Significant contract with Glencore International AG

Thursday, 20 March, 2008
Report no. 18/2008

The Management Board of KGHM Polska Miedź S.A. announces that on 19 March 2008 a contract was entered into between KGHM Polska Miedź S.A. and Glencore International AG for the sale of copper cathodes in years 2008 – 2009. 

The estimated value of this contract is from USD 413 201.1 thousand to USD 557 417.1 thousand, i.e. from PLN 927 223.2 thousand to PLN 1 250 843.9 thousand, depending on the amount of tonnage under option. 

This amount was estimated based on the forecast copper price (using a forward curve) and the National Bank of Poland exchange rate from 18 March 2008. 

This contract foresees contractual penalties for failure to execute payments on time. 

The total estimated value of contracts entered into between KGHM Polska Miedź S.A. and Glencore International AG over the last 12 months is from PLN 991 186.6 thousand to PLN 1 314 807.3 thousand. 

The highest-value contract signed during this period is the above-mentioned contract. 

The criteria used for describing the contract as significant is that the estimated value of the contract exceeds 10% of the equity of KGHM Polska Miedź S.A.

Legal basis: § 5 sec. 1 point 3 of the Decree of the Minister of Finance dated 19 October 2005 regarding current and periodic information published by issuers of securities (Journal of Laws from 2005 No. 209, item 1744)