Gold Fields eyes Mankayan for $70M
Gold Fields Ltd., one of the world’s top gold producers, is exploring the possibility of acquiring the Mankayan copper-gold project in Benguet for $70 million.
This would expand the South African mining giant’s investment in the province’s Mankayan-Lepanto gold district.
The Mankayan project is adjacent to the Far Southeast (FSE) project of Lepanto Consolidated Mining Corp., where Gold Fields can also take a 60-percent stake. If Gold Fields exercises its option on both projects, it will have consolidated a big chunk of the so-called Mankayan-Lepato gold district. Lepanto’s ongoing Victoria gold project has one of the three known ore bodies in the same gold district.
“Because of this deal, Crescent Mining and Development Corp. (the operating company for the Mankayan project) has just filed a renewal of its mineral production sharing agreement or MPSA to complete exploration of the project,” Mines and Geosciences Bureau director Leo L. Jasareno said in an interview.
Gold Fields, through subsidiary Gold Fields Netherlands Services BV, has signed a deal with Perth-based Bezant Resources Plc. Bezant said in a disclosure that it is selling its subsidiary—Asean Copper Investments Limited—to Gold Fields Netherlands under an option agreement signed on Oct. 4, 2011.
Asean has a 40-percent stake in the 534-hectare Mankayan project, through operating company Crescent Mining, and holds an option with Bezant to acquire or assign the remaining 60 percent of Crescent’s issued share capital.
The option agreement delivered a non-refundable upfront cash
payment of $7 million to Bezant and a potential further cash sum of $63 million, which Gold Fields will pay when it exercises the option to
acquire the entire issued share capital of Asean.
Gold Fields has about a year to conduct due diligence in Mankayan and may exercise its option in the project any time until Jan. 31, 2013. As for the adjacent FSE deposit, Gold Fields has until March 2012 to
exercise its option to take a majority stake.
Bezant chairman Gerry Nealon said in a statement posted on the company website that since Gold Fields already holds an option over Lepanto’s FSE project, the Johannesburg-based miner’s ongoing exploration activities are “expected to identify synergistic benefits.”
