Engineering & Mining Journal

JUN 2016

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REGIONAL NEWS - LATIN AMERICA 14 E&MJ; • JUNE 2016 www.e-mj.com Anglo American Sells Brazil Niobium and Phosphates Businesses Anglo American announced in late April that it has agreed to sell its Brazil-based niobium and phosphates businesses to China Molybdenum for $1.5 billion in cash, payable at closing. The wholly owned businesses are located in the Bra- zilian states of Goiás and São Paulo. The transaction is expected to close in the second half of 2016. Anglo American's niobium business includes the Boa Vista open-pit mine and processing plants in Goiás, two addition- al mineral deposits, and sales and mar- keting operations in the United Kingdom and Singapore. The business produces ferroniobium for export to steel mills. The phosphate business includes the Chapadão mine, Ouvidor benefciation plant and two chemical complexes in São Paulo that produce a range of phosphate products. Together, the businesses generated EBITDA of $146 million in 2015. China Molybdenum Chairman and Ex- ecutive Director Li Chaochun said, "This transaction adds long life, cost-competi- tive production to our portfolio and gives our company a foothold in three leading international mining jurisdictions: China, Australia and Brazil." Anglo American CEO Mark Cutifani said, "The proceeds from this transac- tion, together with the ongoing productiv- ity and cost improvements we are driving through the business, will enable us to continue to reduce our net debt toward our targeted level of less than $10 billion at the end of 2016." The transaction is subject to regula- tory approvals from the government of the People's Republic of China and approval by China Molybdenum share- holders. Cathay Fortune Corp. and Luoy- ang Mining Group, the two major share- holders of the company, who in aggregate hold approximately 63% equity interest in the company, have undertaken to vote in favor of resolutions to approve the transaction. The transaction is expected to close in the second half of 2016. Endeavour Silver Acquires El Compas Project in Mexico Endeavour Silver has entered into a de- fnitive agreement with Canarc Resource Corp. to acquire a 100% interest in Oro Silver Resources, a wholly owned sub- sidiary of Canarc. Oro Silver owns the El Compas gold-silver development prop - erty and has a fve-year renewable lease on the 500-metric-ton-per-day (mt/d) La Plata ore processing plant in Zacatecas, Mexico. Consideration for the transaction is C$10.5 million in Endeavour shares. En- deavour will assume Canarc's obligation to pay an aggregate of 165 troy oz of gold from production to Marlin Gold Mining. The transaction was expected to close no later than June 30. Canarc completed a prelimi- nary economic assessment of de- velopment of a 450 mt/d under- ground mine at El Compas in January. Indicated resources are estimated at 552,000 mt grading 6.55 g/mt gold and 66.2 g/mt silver for 116,000 oz of con- tained gold and 1.2 million oz of con- tained silver. Inferred resources are es- timated at 421,000 mt grading 4.18 g/ mt gold and 59.9 oz/mt gold for 57,000 oz of contained gold and 812,000 oz of contained silver. The bulk of the resources are located within 200 m of the surface. The mine would be accessed via a 900-m ramp. The orebody would be mined using a longhole sublevel mining method. The La Plata processing plant was constructed by the Zacatecas state gov- ernment in September 2013 to process minerals available from local small min- ers. It last operated in October 2014; was leased to Oro Silver in January 2016; has fully permitted crushing, grinding, fota- tion, and tailings circuits; and is located within 20 km on mostly paved roads from the proposed El Compas mine. Total production over a mine life of 7.25 years is estimated at 114,600 oz of gold and 885,900 oz of silver. Capital costs to develop the El Com- pas project are estimated at less than $10 million, and the time frame to de- velop the mine and refurbish the plant is estimated at less than one year. The 3,990-ha El Compas property has good exploration potential, including 10 regional vein targets. Endeavour Silver is a Mexico-fo- cused Canadian company headquartered in Vancouver, British Colombia. It has three operating mines: Guanaceví in Durango state, and Bolañitos and El Cubo in Guanajuato state. Combined production from the mines in 2015 to- taled 7.2 million oz of silver and 60,000 oz of gold. Anglo American's niobium business includes the Boa Vista mine and processing facilities, pictured here, in Goiás, Brazil, plus additional mineral deposits and sales/marketing offces. (Photo: Anglo American)

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