Troilus Gold advances project financing with additional LOIs for $500m
In May, the company produced a feasibility study that demonstrated the potential for Troilus to be amongst the largest gold producers in Canada.
Reuters reports Anglo American on Wednesday sold a 24.5% stake in its southern Chilean properties to Japan’s Mitsubishi Corp. for $5.39 billion, undermining plans by Chile’s state-owned Codelco to exercise an option to buy half of it.
Chile decided at the end of October, barely a week after Anglo American announced that the $2.8 billion they splashed on expanding their flagship Los Bronces mine will start to bear fruit before year end, to exercise the 33-year old option that has lapsed before, blindsiding Anglo. Anglo said the transaction values its Chile properties at $22 billion. Codelco was offering $6 billion for 50%.
Chile’s finance minister warned Anglo at the time that it must honour the deal that dates back to 1978. Codelco has put together $6 billion but analyst say that short changes Anglo by billions. What must have really galled Anglo is that they would have had to pay around $1 billion in taxes on the transaction.
Dow Jones explains some of the history: The option was previously held by smaller state mining company, Empresa Nacional de la Minera, or Enami, which sold it to Codelco for $175 million. Anglo acquired the Sur complex in 2002 from then-owner Exxon Mobil which had bought Sur from Enami in 1978, and the transaction included the option.
3 Comments
sally liu
Chile, known as “copper country” copper mining and related industry accounts for the important position of the national economy. Government should manage, so as to play an active role in all mining industry. more views and info at http://www.millsforsale.net/
Alonso Rodriguez
While there is much to be said about the mismanagement of assets by governements the question is why should Anglo act unilateraly when they have a standing agreement. I wonder what would be the position of Anglo should the Chilean government had sold their option to the Chinese?
I work in the financial industry and there is no free lunch nor mining companies have ground to play victims. While Anglo is not worst than other companies it is not the first time they enter into agreements that contradict national interest and policy.
AR
This of course duly forgets that the original mine was sold in a dubious transaction from ENAMI to Exxon at ridiculous price, then being exploited for over 23 years without profit. Please, let the finance wizards that duly praise the private initiative VALUE CREATION superiority of private companies explain this. Anglo continued with the tradition of grossly distorting PL.
Chile is also the place with lowest royalty of mining in the whole world, so this piece of journalism that tries to twist the situation to the complete opposite, is just sickening.
Anglo is going to lose this dispute. Everyone knows that.