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Polymetals sells White Dam interest to JV partner for A$1.44m

28th May 2013

By: Esmarie Iannucci

Creamer Media Senior Deputy Editor: Australasia

  

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PERTH (miningweekly.com) – ASX-listed Polymetals Mining has agreed to sell off its 50% holding in the White Dam gold mine and the associated Drew Hill exploration tenements to its joint venture (JV) partner Exco Resources.

In consideration for the assets, Polymetals would receive A$1.44-million in cash, as well as full ownership of the White Dam camp asset, which was subject to a parallel divestment process.

“The White Dam project is symbolic of how the traditional Polymetals approach has consistently produced outcomes that exceed expectations,” said MD Frank Terranova.

“The approach is best described as a blend of simple pragmatic project methodologies, a disciplined cost focus and an innovative operational culture.”

From initial gold production in April 2010, the White Dam project has delivered some 144 011 oz of gold, compared with the 102 000 oz forecast in the bankable feasibility study.

The project had also recorded recovery rates of 80%, compared with the projected 60% and had operated at a cash cost of below A$500/oz.

Terranova said the divestment of the 50% stake in White Dam was consistent with a strategic review undertaken in early 2013, which concluded that value for shareholders was best achieved by changing the mix of assets within the current portfolio.

He added that the company was continuing to evaluate its asset portfolio in line with this assessment.

In April, Polymetals and fellow-listed gold miner Southern Cross Goldfields announced their intention to merge to create a diversified Australian gold company.

Under the merger agreement, Southern Cross was offering 11 of its own shares for every one Polymetals share held, with Southern Cross shareholders collectively holding a 47% interest in the merged company and Polymetals shareholders collectively holding the balance.

Edited by Chanel de Bruyn
Creamer Media Online Managing Editor

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