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| Image courtesy of Coppermoly. |
The three projects are all on PNG’s New Britain Island and include the Nakru project in exploration licence 1043, the Talelumas project (EL1445) and the Simuku project (EL1077).
Coppermoly put on a brave face in its announcement on the matter.
“In light of the significant copper intersections at the Nakru project over the past few years, we believe these projects have considerable value and potential to progress through to feasibility with additional drilling,” Coppermoly managing director Peter Swiridiuk said.
“Although these projects may not presently represent the size for development by the world’s largest gold producer, the significant grades of copper, gold and zinc and current commodity prices put them in good standing for further development.”
Barrick only completed its $A20 million farm-in agreement to earn a 72% stake in each of the three projects by early January.
Any successful buyer must take on Barrick’s obligations under the JV with Coppermoly. This includes the costs of scheduled drilling on the Nakru and Simuku tenements in the second half of 2012 plus other expenditure and work commitments.
Coppermoly can also trigger a right of refusal which allows it to acquire Barrick’s stakes in the projects if it can match the terms proposed by a potential third party purchaser.
Under the JV, Barrick carried Coppermoly’s 28% share of exploration and development costs up to the completion of a feasibility study, with repayments to be delayed until production starts up on the tenements.
Coppermoly said it will consider its options once Barrick has received any proposals.
Barrick’s board recently ousted its president and chief executive officer Aaron Regent, but many believe this outcome stemmed from the miner’s $C7.3 billion ($A7.17 billion) acquisition of African copper producer Equinox Minerals last year.
Barrick’s major Porgera mine in PNG has faced difficulties in 2012 so far due to site disruptions and a significant power outage which forced it to turn to diesel-fired electricity for several weeks.
