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Toronto, Ontario, 1 September 2011
Xstrata Copper, Goldcorp Inc. (“Goldcorp”) and Yamana Gold Inc. (“Yamana”) announced today that they have reached a definitive agreement providing Minera Alumbrera Limited Sucursal Argentina (“Minera Alumbrera”) the exclusive option to acquire Yamana’s 100% interest in the Agua Rica project. Agua Rica is a feasibility stage project in the province of Catamarca, Argentina, located approximately 35 kilometres from the currently operating Alumbrera mine.
Minera Alumbrera is a joint venture operation between Xstrata Copper (manager and 50% owner), Goldcorp (37.5% owner) and Yamana (12.5% owner) that currently operates the Alumbrera mine. Under the terms of the agreement, Minera Alumbrera holds an exclusive four-year option to acquire Yamana’s interest in the Agua Rica project for cumulative payments made by Goldcorp and Xstrata Copper of $110 million. During the option period Minera Alumbrera will manage the Agua Rica project and fund a feasibility study and all development costs. The respective ownership interests in Minera Alumbrera would remain unchanged and apply to the Agua Rica project.
The formal documentation includes the Feasibility Services Agreement under which Minera Alumbrera took control of Agua Rica as of August 31, 2011. In addition, the shareholder and management agreements for Minera Alumbrera were amended to facilitate the potential integration of the combined projects. As required, Goldcorp and Xstrata Copper have made a payment of $20 million to Yamana on execution of the definitive agreements, in addition to the $10 million paid previously.
Minera Alumbrera can elect to exercise the option at any time during the four-year period. Upon approval to proceed, Yamana would receive $150 million and a further $50 million on commencement of commercial production in addition to the remaining option payments of $80 million, all as previously disclosed. 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.
An independent feasibility study has now commenced under the direction of Xstrata Copper, as the manager of Minera Alumbrera. Fluor Canada Ltd. (“Fluor”) has been retained to conduct the study which is expected to be complete in early 2013. At the same time, Minera Alumbrera will work with stakeholders, including Yacimientos Mineros de Agua de Dionisio to assess the optimum potential development of Agua Rica and complete Environmental Impact Studies. Subject to a positive feasibility study, the option being exercised, and all necessary corporate and government approvals, a construction decision is expected to follow with construction potentially starting in 2013.
FOR FURTHER INFORMATION PLEASE CONTACT:
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Lisa Doddridge
Vice President, Corporate Communications and Investor Relations
Yamana Gold Inc.
(416) 945-7362
1-888-809-0925
Email: lisa.doddridge@yamana.com |
Emily Russell
Manager Global Communications
Xstrata Copper
Telephone +562 478 2204
Mobile + 569 9443 3571
Email: erussell@xstratacopper.com
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Jeff Wilhoit
Vice President, Investor Relations
Goldcorp Inc.
Telephone: (604) 696-3074
Fax: (604) 696-3001
E-mail: info@goldcorp.com |
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Notes to editors
About Minera Alumbrera
Minera Alumbrera is a joint venture operation between Xstrata Copper (manager and 50% owner), Goldcorp (37.5% owner) and Yamana (12.5% owner). Minera Alumbrera has the right to mine the Bajo de la Alumbrera copper-gold deposit, located 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. In 2010, Minera Alumbrera produced 140,000 tonnes of copper in concentrate and 405,000 ounces of gold in concentrate and gold dore.
About Agua Rica
Agua Rica is a large-scale copper and gold deposit located approximately 35 kilometres from Alumbrera mine in north-west Argentina’s Catamarca province. The optimum production profile will be confirmed through the feasibility study but Minera Alumbrera’s analysis to date indicate that Agua Rica has the potential to produce approximately 250,000 tonnes of copper and 140,000 ounces of gold per annum for the first five years and an annual average of 150,000 tonnes of copper and 130,000 ounces of gold, together with associated molybdenum production, over a 26-year mine life.
About Xstrata Copper
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
About Goldcorp
Goldcorp is one of the world’s fastest growing senior gold producers. Its low-cost gold production is located in safe jurisdictions in the Americas and remains 100% unhedged.
About Yamana
Yamana is a Canadian-based gold producer with significant gold production, gold development stage properties, exploration properties, and land positions in Brazil, Argentina, Chile, Mexico and Colombia. Yamana plans to continue to build on this base through existing operating mine expansions, throughput increases, development of new mines, advancement of its exploration properties and by targeting other gold consolidation opportunities with a primary focus in the Americas.