Asarco’s Yamarna stake up for grabs

Major US copper producer Asarco Incorporated has put its stake in the Yamarna gold joint venture near Laverton on the market as it continues its exit from Australia and other non producing assets around the world.

Last month the company failed in a bid to privately sell its 80 per cent stake in the joint venture to local junior exploration company Aquila Resources for a total of $15 million.

Aquila walked away from the project following drilling, which was part of its due diligence process.

Arsaco Exploration Company Australia regional manager Russell Davis said the company had decided to enter into a more competitive sales process, retaining merchant bank Rothschild to handle the deal.

An information memorandum went out last week inviting about 25 mining companies to bid for the project.

Mr Davis said while an asking price had not been divulged, the company had advised Rothschild of an acceptable price range.  

He said Rothschild had received “plenty” of interest in the project since the IM was issued.

A number of local gold companies with low reserves are understood to have been targeted.

Patersons Securities analyst Alex Passmore said Kalgoorlie-based gold miner Croesus Mining could to be a possible contender for the stake.

Mr Passmore said despite growing reserves at Norseman its other two operations had limited mine lives.

“Croesus could have up to $25 million in the bank at the end of September depending on capital requirements at Norseman,” he said.

Submission of offers close at the end of the month with submission of final offers expected to close at the end of November.

Arsaco is in joint venture in the project with Melbourne-based explorer Yamarna Goldfields, which owns the remaining 20 per cent of the venture.

As part of the Aquila deal, Asarco was to sell its 80 per cent stake, with Aquila taking a 70 per cent interest and Yamarna increasing its stake to 30 per cent. Yamarna also had an option to acquire a further 10 per cent from Aquila.

The project’s resource base calculated in 2002 was 12.59 million tonnes at an average grade of 1.82gpt gold for 738,000 oz contained gold.

Recent drilling results released by Yamarna included intercepts of two metres grading 27.5 grams per tonne gold from 73m and 3m at 17.9gpt gold from 79m.

Asarco Incorporated is a subsidiary giant Mexican copper producer, Grupo Mexico.

Mr Davis said Asarco was in the process of divesting its non-producing assets around the world to focus on three large copper mines in Arizona, US.

In Australia, as well as the Yamarna project, Asarco also shares an interest with zinc miner Perilya in the Dee Range base metals project near Mount Morgan in Queensland. It also holds 100 per cent interests in base and precious metals tenements in WA and in Queensland.