Vancouver-based Vengold (TSE) is acquiring an indirect 10% interest in the large Lihir gold project in Papua New Guinea (PNG).
The junior has signed an agreement with project manager RTZ (NYSE) to acquire the interest for US$50 million.
The transaction is scheduled to close during the second quarter. Project ownership will be split RTZ, 40% (i.e. RTZ 75% and Vengold 25%); Niugini Mining, 30%; and the PNG government, 30%.
The estimated capital cost of Lihir is US$670 million. A new public company, Lihir Gold, will be created this year. RTZ expects the project will be financed entirely by bank loans and from the proceeds of the initial public offering of Lihir Gold shares.
Reserves at Lihir total 98.4 million tons averaging 0.139 oz. per ton.
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