Miner Augusta warns on possible Arizona permit delay

Thu May 22, 2014 6:36pm EDT

Related Topics

May 22 (Reuters) - Augusta Resource Corp, the target of a hostile takeover bid by HudBay Minerals Inc , warned on Thursday of another delay in getting a permitting decision on whether it can develop its Rosemont copper project in Arizona.

Augusta said the decision may be delayed until the third quarter after the U.S. Forest Service commented informally that it may not be in a position to make a final decision by the end of the second quarter.

The delay comes as the forest agency weighs whether further consultation is necessary in part following the recent sighting of an ocelot near the proposed mine development area. Ocelots, also known as dwarf leopards, are listed as endangered by the U.S. Fish & Wildlife Service.

"While we are disappointed with any delay, our expectation is that these final issues will be handled in a timely, expeditious manner," Gil Clausen, Augusta's chief executive, said in a statement.

Canadian miner HudBay, which already owns 16 percent of Augusta, in February launched a bid for the U.S.-based mining company to gain control of the Rosemont project. Augusta has rejected the approach.

The Rosemont project, southeast of Tucson, is widely thought to be one of the most promising copper projects in the United States, but it has been hit by numerous permitting delays.

Separately Augusta said financier Red Kite has agreed to allow the miner to draw down another $6 million on its loan facility, waiving a condition that the company first obtain a permit from the U.S. Forest Service. (Reporting by Nicole Mordant in Vancouver; Editing by Steve Orlofsky)

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.