Wheaton River Minerals (WRM-T) plans to raise US$150 million via a private placement of shares and warrants to help cover the US$210 million price tag on two Rio Tinto (RTP-N) gold assets.
Wheaton recently agreed to buy Rio’s Peak gold mine in Australia along with the major’s 25% stake in Argentina’s Bajo de la Alumbrera gold-copper operation.
The deal propels Wheaton River into the number-eight slot among Canadian gold producers, increasing output to 458,000 oz. gold-equivalent up from the 190,000 oz. originally slated for 2003.
In 2001, the Peak gold mine in New South Wales produced 100,800 oz. of gold at a cash cost of US$189 per oz. The operation is expected to average 110,000 oz. gold annually at a cash cost of US$189 per oz. until the end of the current mine life in 2007.
The US$1.2-billion Bajo de la Alumbrera gold-copper mine in Catamarca province, produced 759,360 oz. gold and 199,550 tonnes copper at a cash cost (including copper credits) of minus US$18 per oz. gold during the year ended June 30, 2002.
Over the next five years, the operation is expected to crank out 540,000 oz. gold and 180,000 tonnes copper annually. Wheaton River’s annual share would be 135,000 oz. gold and 45,000 tonnes copper.
Wheaton River can defer up to US$70 million of the US$210-million total purchase price for 24 months.
The deal, which is subject to the signing of a definitive agreement, is slated to close by the end of February.
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