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Newcrest Mining (ASX: NCM), Australia's largest gold producer, is increasing its stake in the Havieron gold and copper project developed with Greatland Gold (LON: GGP) in Patterson, Western Australia.
The gold giant, the manager of the joint venture, has agreed to take a 70 per cent stake in the project and has the option to get an additional 5 per cent stake from Greatland at an agreed price.
The option exercise price is expected to be determined by mid-February 2022, the companies said.
The proceeds will first be used to repay the outstanding balance under the Newcrest loan arrangement, Greatland said in a statement.
The recent Havieron pre-Feasibility study shows that the operating cost of 2 million tons per year is A $529 million, producing 160000 ounces of gold and 6900 tons of copper over nine years at a sustained cost of US $990 per ounce of (AISC). The processing will be carried out through the Telfer factory near Newcrest.
Newcrest also has a conditional right to an additional 10 per cent stake in the joint venture, which would increase its participation rate to up to 70 per cent. If both options are exercised, the gold giant will own 75 per cent of the shares.
The Melbourne-based company has been actively looking for junior enterprises with attractive assets to develop together.
In 2019, it bought a 70 per cent stake in Canada's Red Chris copper and gold mine from TSX:III.
Last month, it bought all outstanding common shares of Pretium Resources (Toronto Stock Exchange symbol: PVG, New York Stock Exchange symbol: PVG), a deal that valued the Canadian mining company at $2.8 billion.
The Patterson area has several large gold and copper deposits, such as Nifty, Winu and Newcrest's own Telfer.
