Glencore is planning to sell its option in a gold mine owned by Falco Resources, two sources familiar with the situation said on Thursday, as the mining group and commodities trader presses ahead with asset sales.
London-listed Glencore has appointed BofA Merrill Lynch to sell the 65 percent option in the Horne 5 gold project in Quebec, the sources said, and potential buyers have been contacted.
Falco has calculated that the undeveloped Horne 5 deposit could have a net present value (NPV) of about $667 million, assuming a gold price of $1,250 an ounce and certain currency exchange conditions, according to its website. Spot gold was up 1 percent at $1,303.91 an ounce at 1148 GMT on Thursday.
Situated close to Canada’s Val d’Or, the asset is likely to appeal to Canadian miners already familiar with the region. Barrick Gold, Alamos Gold and Agnico Eagle Mines are among those who could be interested, one of the people said, cautioning that no deal was certain.
Falco is the full owner of the project. However Glencore, which originally inherited the mine when it bought Xstrata, has a right to buy back a 65 percent stake.
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