UPDATE 1-Antofagasta, Duluth in $130 mln Deal on U.S. Mine-Shanghai Metals Market

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UPDATE 1-Antofagasta, Duluth in $130 mln Deal on U.S. Mine

Industry News 09:10:20AM Jan 15, 2010 Source:SMM

LONDON, Jan 14 (Reuters) - Chilean copper miner Antofagasta is to acquire a 40 percent interest in a mine project in the northern United States, expanding its footprint to North America as it seeks to boost growth.

London-listed Antofagasta said on Thursday it would provide $130 million of funding over three years for the Nokomis project in Minnesota, owned by Canadian-listed Duluth Metals (DM.TO), in exchange for the initial stake.

It also has an option to increase the stake to 65 percent.

"This transaction is in line with our stated strategy of seeking and acquiring interests in high quality mining assets in order to further enhance our long-term growth prospects," said Marcelo Awad, chief executive of the Antofagasta's mining unit.

"Nokomis has significant potential as one of the world's largest undeveloped base and precious metal resources."

Antofagasta will also buy 6 million new shares in Duluth in a private placement at C$2.00 per share, giving it a 7 percent stake in the company. Duluth shares closed on Wednesday at C$2.14.

Nokomis -- which contains copper, nickel and platinum group metals -- has an indicated resource of 550 million tonnes and a combined copper equivalent grade of about 1.5 percent.
 

UPDATE 1-Antofagasta, Duluth in $130 mln Deal on U.S. Mine

Industry News 09:10:20AM Jan 15, 2010 Source:SMM

LONDON, Jan 14 (Reuters) - Chilean copper miner Antofagasta is to acquire a 40 percent interest in a mine project in the northern United States, expanding its footprint to North America as it seeks to boost growth.

London-listed Antofagasta said on Thursday it would provide $130 million of funding over three years for the Nokomis project in Minnesota, owned by Canadian-listed Duluth Metals (DM.TO), in exchange for the initial stake.

It also has an option to increase the stake to 65 percent.

"This transaction is in line with our stated strategy of seeking and acquiring interests in high quality mining assets in order to further enhance our long-term growth prospects," said Marcelo Awad, chief executive of the Antofagasta's mining unit.

"Nokomis has significant potential as one of the world's largest undeveloped base and precious metal resources."

Antofagasta will also buy 6 million new shares in Duluth in a private placement at C$2.00 per share, giving it a 7 percent stake in the company. Duluth shares closed on Wednesday at C$2.14.

Nokomis -- which contains copper, nickel and platinum group metals -- has an indicated resource of 550 million tonnes and a combined copper equivalent grade of about 1.5 percent.