Petaquilla plans reorganization

Vancouver — A proposed reorganization of Petaquilla Minerals (PTQ-T) will sever the company’s gold projects and exploration lands from its porphyry copper deposits in north-central Panama. A new corporate entity would then hold the gold and exploration assets.

The plan will be submitted for approval to shareholders at an extraordinary meeting, likely to be held in September.

Petaquilla Minerals says spinning off the gold assets and exploration lands will allow it to focus on developing its large porphyry copper deposits in Panama. This could involve a potential sale, or a joint development agreement with another company.

The precious metals and exploration lands will be transferred to a new corporation in return for shares intended for distribution to shareholders of Petaquilla Minerals. The share-ratio for the distribution has not yet been determined.

The reorganization plan is subject to the new company’s being accepted for listing on a stock exchange, and to the approval of shareholders.

Petaquilla’s main gold asset is the Molejon epithermal deposit, on the company’s large land package in Panama. An independent consultant has been retained to upgrade a 1995 resource estimate.

In early June, Teck Cominco (TEK-T) and Inmet Mining (IMN-T) agreed to transfer their interests in Molejon (and other gold deposits) to Petaquilla Minerals, subject to a royalty.

If Petaquilla receives a third-party offer for the copper deposits, proceeds will be shared 29% by the company, 23% by Teck Cominco, and 48% by Inmet.

Petaquilla recently set up an advisory board of industry professionals to guide the company’s efforts. The board consists of John Purkis, Michael Beley, Octavio Choy and Robert Baxter.