Newcrest gains majority stake in Red Chris
NEWCREST Mining has agreed to purchase a 70 per cent joint venture interest in Imperial Metals’ Red Chris mine in Canada for $US806.5 million.
The Red Chris project is an operational open-pit mine with a mineral resource of 20 million ounces of gold, and 13 billion pounds of copper in the prospective ‘Golden Triangle’ of British Columbia, Canada.
Newcrest said the acquisition of the mine was “a measured entry into North America” and aligned with its values of building a portfolio of tier 1 orebodies.
“We are delighted to add this asset into the Newcrest portfolio,” Newcrest managing director and chief executive Sandeep Biswas said.
“The geology of Red Chris is similar to our Cadia orebodies in Australia and we will be applying our considerable experience in exploration, open pit mining, caving and processing to maximise the value of Red Chris and the opportunities in the surrounding region.
“We look at this opportunity in the same way as we do with Cadia, where we have proven we can create significant value from deep underground porphyry orebodies.
“We are pleased to be establishing a joint venture with Imperial and look forward to building a collaborative relationship with the Tahltan Nation and the Government of British Columbia.”
The company said it had a two-stage plan to unlock value from the project; applying a transformation approach to the open pit and processing plant, including debottlenecking the plant, improving concentrate quality, mine optimisation and supply chain cost reduction; and applying new technologies it had successfully deployed at other operations.
Technologies included block caving whereby necessary drilling and studies would be completed; coarse ore flotation; mass sensing and sorting; and deep underground brownfield and greenfields exploration.
The Red Chris property spanned 23,142 hectares, and comprised 77 mineral tenures of which five included mining leases.
Canadian company Imperial Metals president Brian Kynoch said selling a 70 per cent interest in the project to Newcrest, would enable it to strengthen its balance sheet and further develop the resource.
“We believe that this joint venture partnership will enable Imperial to unlock significant value at Red Chris by leveraging Newcrest’s unique technical expertise in block caving operations,” Mr Kynoch said.
“With a stronger financial position and highly actionable path to exploiting the underground mining potential of Red Chris, Imperial will be in a much stronger position to create value and opportunities.”
The sale was expected to be finalised by August 2019.