World’s second largest gold producer Newmont Mining (NYSE:NEM) has acquired 19.9% of Canadian gold junior Orosur Mining (TSX, AIM:OMI), which recently closed operations in Uruguay and Chile to focus on Colombia.
Through a placement worth $2 million, Newmont has acquired 29.2 million commons shares at a price of C9.1c (6.9 cents) each. The exploration and option agreement includes a three-phase earn-in structure that allows Newmont to earn up to a 75% ownership interest in Orosur’s Anzá project, located in Colombia’s Department of Antioquia.
To secure a majority stake in the project, however, the US miner would have to spend $30-million over 12 years, complet a National Instrument 43-101-compliant feasibility study and make $4 million in cash payments, Orosur said in a statement.
Once Newmont completes the last phase, Orosur may elect it to fund all expenditures until commercial production starts at Anzá. Should the company pursue this option, Newmont’s ownership in the project will increase to 80%.
Orosur’s London-listed shares responded positively to the news, trading 300% higher to 7.28p on Monday morning and jumped 160% in Toronto to 9 Canadian cents by 9:30 am ET.
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