AngloGold sells Amapari to Eike Batista (June 02, 2003)

AngloGold (AU-N) will sell its Amapari project in northeastern Brazil’s Amapa state to Eike Batista’s Mineracao Pedra Branca do Amapari for US$18.2 million.

AngloGold acquired Amapari in 1998 as part of its combination with Anglo American subsidiary Minorco, and then went on to delineate reserves of 9.8 million tonnes grading 2.29 grams gold per tonne, or 721,000 contained ounces gold.

“Although it has been a difficult decision to dispose of the property, AngloGold has realized a fair price for it, and I am pleased the project will be completed,” says Roberto Carvalho Silva, regional head for AngloGold South America.

Batista has a reputation as a fast-living Brazilian millionaire but is best known to North Americans as the founder of TVX Gold, which was formed out of Inco’s gold assets in the late 1980s. TVX was recently acquired by Kinross Gold.

AngloGold still operates two profitable gold mines in Brazil: Morro Velho, in the Belo Horizonte region; and Serra Grande, near the city of Crixas.

Morro Velho, a wholly owned underground mine, produced 53,000 oz. gold in the first quarter at a total cash cost of US$127 per oz., for an operating profit of US$11 million.

Ownership in Serra Grande is split equally between operator AngloGold and Kinross (the latter stake acquired through the TVX purchase). The 2-mine complex yielded 48,000 oz. gold in the first quarter at a total cash cost of only US$93 per oz., for an operating profit of US$5 million.

Meanwhile, AngloGold continues to explore its Lamego project, near Cuiaba, where drilling has intersected 10-metre-thick mineralization grading 5-10 grams gold at depths of 250-350 metres below surface. Mineralization appears to be open to the south.

At the Corrego do Sitio gold project, AngloGold is developing a ramp to gain access to sulphide mineralization. Drilling there has intercepted 6 metres grading 38.9 grams per tonne.