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Minera Alumbrera shareholders enter letter of intent for an option to acquire the Agua Rica copper gold project in Argentina

Xstrata Copper and Goldcorp Inc. have entered into a Letter of Intent (“LOI”) with Yamana Gold Inc. that grants Minera Alumbrera an exclusive option with respect to Yamana’s 100% interest in the Agua Rica copper gold project in Catamarca province in northwest Argentina. The transaction remains subject to the parties agreeing binding transaction documents.

Minera Alumbrera is a joint venture company between Xstrata Copper (Manager and 50% shareholder), Goldcorp (37.5%) and Yamana (12.5%). The Agua Rica deposit is located 35 kilometres southeast of Minera Alumbrera’s Bajo de la Alumbrera copper gold mine.

The LOI outlines an agreement in which Minera Alumbrera will be granted an exclusive four-year option to acquire Yamana’s interest in the Agua Rica project for progressive option payments of up to US$110 million. Xstrata Copper and Goldcorp will finance all payments related to the option on a 57.14% and 42.86% basis respectively.

Xstrata Copper and Goldcorp can collectively elect to exercise the option at any time during the four-year period through an approval to proceed decision for construction of the Agua Rica project. On approval to proceed, Yamana would receive US$150 million and on commissioning an additional US$50 million. Yamana would also retain the right to a deferred payment related to 65% of the payable gold production from Agua Rica to a maximum of 2.3 million ounces.

Minera Alumbrera will manage the Agua Rica project and fund the completion of a final feasibility study and all development costs. The respective ownership interests in Minera Alumbrera would remain unchanged and apply to the Agua Rica project.

Xstrata Copper Chief Executive, Charlie Sartain said the option would enable Minera Alumbrera to further evaluate the potential of the Agua Rica project as part of that company’s long term growth strategy.

“The option in the Agua Rica project presents Minera Alumbrera with an attractive low-risk opportunity to expand its current operations and extend its current mine life by more than 25 years. On completion of the binding transaction documents, we look forward to working with our joint venture partners, relevant authorities and other key stakeholders, including Yacimientos Mineros de Agua de Dionisio1, to assess the potential development of Agua Rica.”


Xstrata contacts:

Xstrata Copper
Emily Russell
Telephone: +562 478 2204
Mobile: + 569 9443 3571
Email: [email protected]

Alison Flynn
Telephone +44 20 7968 2838
Mobile +44 7769 314374
Email [email protected]

Neither the content of the company’s website nor the content of any other website accessible from hyperlinks on the company’s website is incorporated into, or forms part of, this announcement

Xstrata is a global diversified mining group, listed on the London and Swiss Stock Exchanges. Headquartered in Zug, Switzerland, Xstrata maintains a meaningful position in seven major international commodity markets: copper, coking coal, thermal coal, ferrochrome, nickel, vanadium and zinc with additional exposure to gold, cobalt, lead and silver. The Xstrata Group also comprises a growing platinum group metals business, iron ore projects, recycling facilities and a suite of global technology products, many of which are industry leaders. The Group’s operations and projects span 20 countries.

Xstrata Copper is the fourth largest global copper producer with attributable mined production in 2010 of 913,500 tonnes of copper in cathodes and concentrates. The company is also one of the world’s largest producers of smelter and refined copper, including from third party materials.

Headquartered in Brisbane, Xstrata Copper is one of the commodity business units within the major global diversified mining group Xstrata plc. Its mining and metallurgical operations and development projects span eight countries: Argentina, Australia, Canada, Chile, Peru, the Philippines, Papua New Guinea and the USA. Its operations and projects are administered through a regional divisional management structure, which ensures that critical decisions are taken close to the related businesses. It also has a recycling business (Xstrata Recycling) with plants in the United States and offices in Canada and Asia.

Xstrata Copper manages and has a 50% controlling interest in Minera Alumbrera with Canadian companies Goldcorp and Yamana Gold owning the remaining 50%. Minera Alumbrera has the right to mine the Bajo de la Alumbrera copper-gold deposit, located in the in Catamarca province in northwest Argentina, by agreement with Yacimientos Mineros de Agua de Dionisio (YMAD) which has the title to the deposit. YMAD is formed by the government of Catamarca province and the National Tucuman University and is entitled to 20% of Minera Alumbrera’s net proceeds.

Minera Alumbrera has an annual production capacity of 150,000 tonnes of copper in concentrate, 400,000 ounces of gold in concentrate, 50,000 ounces of gold dore and 1,600 tonnes of molybdenum concentrate. Its facilities include the open pit mine and processing plant situated in Catamarca; 317 km slurry pipeline extending from Catamarca to Tucumán; 202 km 220 kV powerline from El Bracho power station in Tucumán; filter plant and rail loading facilities situated in Cruz del Norte (Tucumán); and port facilities situated in Puerto General San Martín, near Rosario (Santa Fe).

Pierre Perrin-Monlouis
Pierre Perrin-Monlouis
Fondateur de Rente et Patrimoine (cabinet de gestion de patrimoine), Pierre Perrin-Monlouis est un analyste et trader pour compte propre. Il vous fait profiter de son expérience en trading grâce à ses analyses financières et décrypte pour vous les actualités des marchés. Son approche globale des marchés combine à la fois l'analyse technique et l'analyse fondamentale sur l'ensemble des marchés : crypto, forex, actions et matières premières.