Oz sells off Cambodian assets

By: Esmarie Swanepoel
20th February 2012

PERTH (miningweekly.com) - ASX-listed Oz Minerals on Monday offloaded its Cambodian gold assets to fellow listed Renaissance Minerals for A$17.8-million in cash, shares and options in Renaissance.

The Cambodian gold projects cover some 1 100 km2 within the eastern region of the country and have a Joint Ore Reserves Committee indicated and inferred resource estimate of 12.6-million tons, at 1.8 g/t gold for 729 000 oz of gold.

Oz Minerals MD and CEO Terry Burgess said on Monday that the company had sought to develop and operate a midtier gold mine in Cambodia, and to this end took its Cambodian interests from a grassroots project to an identified gold resource.

“However, after review, we have concluded that this project does not fit within Oz Mineral’s strategy and regard to scale in relation to the commodity and our overall preference for mid-ier copper projects,” said Burgess.

He noted that the company was pleased to be selling the assets to a firm with strong ambitions to see the project developed.

Under the terms of the transaction, Renaissance would pay A$1-million in cash upon the execution of a sale and purchase agreement and a further A$6.8-million in cash upon the completion of the agreement.

The company would also issue 26.4-million shares to Oz Minerals, on shareholder approval. A further three-million options would also be issued, along with A$5-million in cash on the 12-month anniversary of the agreement.

A further A$10-million would be payable in cash upon either a 1.25-million ounce gold resource being defined, or the decision to mine. A$12.5-million in cash would also be paid six months after the first gold pour.

“This is a company-making acquisition for Renaissance. It is a unique opportunity to be able to secure a project with a 720 000 oz gold resource defined within a single deposit, along with multiple drill-ready prospects that offer exceptional exploration potential in an emerging new gold district,” said Renaissance MD Justin Tremain.

“Through this deal, Renaissance will attract another supportive, and highly regarded corporate cornerstone shareholder in Oz Minerals, which we believe will be beneficial to Renaissance in achieving its growth objectives,” Tremain said.