Wheaton eyes $150m private placement

Wheaton River Minerals (WRM-T) will privately place US$150 million worth of shares and warrants to help cover the cost of buying the Peak gold mine in Australia and a quarter-interest in the Bajo de la Alumbrera mine in Argentina.

The junior miner must pay Rio Tinto (RTP-N) US$140 million before the titles are transfered and another US$70 million over the following two years. A tentative closing date has been set for late February (T.N.M., Jan. 20-26/03).

Between 2003 and 2005, the mines are expected to contribute a combined 269,500 oz. to Wheaton’s annual production and thus propel it to eighth spot among Canadian gold producers. The company currently produces 100,000 oz. gold and 6 million oz. silver per year from three Mexican mines it acquired last June for US$75 million and 9 million shares.

In the meantime, Wheaton’s cash costs fall to US$124 per oz. gold-equivalent, and its proven and probable reserves jump to roughly 3.3 million oz. gold-equivalent.

Based on current metal prices, Wheaton believes it will be cash-flow positive by 2005.

Wheaton has 189 million shares outstanding, or 262 million fully diluted.

At Sept. 30, 2002, it had US$19 million in cash and was debt-free.