North Korea Times
20 Jun 2015, 15:05 GMT+10
MELBOURNE - Australia's class leading nickel producer, Western Areas Ltd through its fully owned subsidiary Australian Nickel Investments Pty Ltd, is acquiring the Cosmos Nickel Complex in Western Australia from Xstrata Nickel Australasia Operations Pty Ltd, a subsidiary of Glencore plc, for A$24.5 million ($19 million).
Global mining and commodity trader Glencore had acquired the Cosmos Nickel Complex through its takeover of Xstrata. Earlier this month Glencore also sold its 23.9 percent stake in platinum producer Lonmin, another asset it inherited from Xstrata.
The binding acquisition deal, announced Friday, by Western Areas is a fraction of the A$3.1 billion ($2.7 billion) Xstrata spent in 2008 to acquire the Cosmos and Sinclair mines as part of its takeover of Jubilee Mines.
Xstrata had stopped operations at Cosmos in 2012 and Sinclair in 2013 in the wake of prolonged weak nickel prices.
Western Areas expects the new acquisition will provide it with substantial additional exploration upside and a potential second mining operation alongside its premium mines and exploration activities at the company's existing Forrestania Nickel Operation.
Citing an industry source, Reuters reported that Cosmos is expensive to mine and its economic reserves are largely exhausted given the weaker nickel price, down about 60 percent from its 2008 peak.
Highlighting the attractiveness of the acquisition, Western Areas however stated that there are substantial exploration opportunities in areas which remain largely untested. It is proposing a 24 month programme once the transaction is completed.
According to Western Areas there is a "third potential underground mine with the undeveloped Odysseus high grade deposit hosting a total mineral resource of 7.3 million tonnes @ 2.4 percent nickel containing 174,000 tonnes of nickel."
Historical production from Cosmos is around 127,000 tonnes of nickel at an average grade of 5 percent, Western Areas said
The project is located approximately 28km north-west of the BHPB Leinster nickel operations and 370km north-west of Kalgoorlie in Western Australia. The project covers 88 square km in the Agnew Wiluna Nickel Belt, one of the world's premier nickel belts with endowment in excess of 9 million nickel tonnes.
Western Areas considers the acquisition metrics to be very favourable at an enterprise value to resource multiple of A$0.06/lb on the Odysseus deposit and A$0.02/lb on all contained nickel resources acquired.
The Australian mining company also sees additional project value in the extensive exploration upside on the tenements, operation-ready site infrastructure and significant spares inventory
Get a daily dose of North Korea Times news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to North Korea Times.
More InformationWASHINGTON D.C.: After several high-profile near collision incidents, the US Federal Aviation Administration (FAA) has issued a safety alerts to ...
PHNOM PENH, Cambodia: Two Cambodian opposition figures--- Yim Sinorn and Hun Kosal--- have been charged under the country's rarely used ...
WASHINGTON D.C.: The US Supreme Court has ruled that a deaf student in Michigan can sue his public school district, ...
MANILA, Philippines: Under a defense agreement with the U.S., four new military bases will be located in various parts of ...
WASHINGTON D.C.: The US Centers for Disease Control and Prevention (CDC) has reported that infections by the potentially deadly fungus ...
WASHINGTON D.C.: The US Supreme Court will hear a trademark dispute over a dog toy shaped like a Jack Daniel's ...
BENTON, Arkansas: Reuters reported that due to a reduction or elimination in evening and weekend shifts, Walmart will lay off ...
MOSCOW, Russia: As western automakers have left Russia since the start of the Ukraine war, the Chinese have rushed in ...
LONDON, England: Reuters has reported that struggling Virgin Orbit, owned by billionaire Richard Branson, is nearing a $200-million investment deal ...
NEW YORK CITY, New York: To comply with the requirements of the "Made in America" laws, a $7.5 billion federal ...
LONDON, England: During a Bloomberg conference held in London this week, Luke Ellis, CEO of hedge fund Man Group, said ...
NEW YORK, New York - Wall Street jumped on Friday, although gains were modest after bank shares in Europe came ...