Mindoro Resources expects to sign 75% deal for copper-gold mines

02-Mar-2009 Intellasia | Dow Jones | 7:01 AM

Mindoro Resources Ltd (MIO.V) expects to sign a joint venture agreement next month allowing Gold Fields Ltd (GFI) acquire up to 75% in three of its mines in the Philippines, helping secure funds to explore and develop these copper-gold projects.

Mindoro will sell stakes in its El Paso, Lobo and Talahib porphyry properties in Batangas province, south of Manila.

The pact may also accelerate exploration and development of these areas given that the acquirer is the world’s fourth-largest producer of gold. The two companies had signed a “non-binding letter agreement” in September last year, allowing the potential buyer conduct due diligence. Gold Fields may have to spend AU$35 million to secure the stake, the company said on its Web site.

“We hope to start working with them within the first quarter of this year,” Mindoro’s President James Anthony Climie told reporters Friday.

“We’ve taken early-stage projects we’ve defined as very interesting copper and gold targets which will require far more exploration funds that we can’t raise ourselves. So it makes sense for us to partner with big companies which can bring the project all throughout development, if warranted.”

Gold Fields had said it anticipates the first drill programme on the Lobo porphyry copper-gold project to begin before the end of the first quarter, Mindoro had said earlier.

Mindoro had earlier obtained from a mining apartment over these properties from the Philippine government, giving the company the right to explore and develop the project.

Details of the reserves in these areas aren’t known because they are still at an exploration stage.

The properties “cover favourable geology and abundant epithermal gold-copper-silver showings and several clusters of porphyry copper-gold prospects,” Mindoro said on its Web site.

Mindoro had also signed in September last year another agreement allowing London-listed Avocet Mining Plc (AVM.LN) to own up to 75% of its Archangel project, also in Batangas province.

Gold Fields is listed in South Africa and Dubai and on the New York Stock Exchange. Mindoro is listed in Toronto and Frankfurt.