TORONTO, June 18 Aston Bay Holdings Ltd,
a Canadian mineral exploration company, said on Wednesday it has
signed a preliminary deal with Antofagasta Plc for the
two to partner on Aston Bay's promising Canadian Arctic copper
The memorandum of understanding gives Antofagasta a path to
an eventual proposed joint venture and the option to earn up to
a 70 percent interest in the Storm project, which is controlled
by Aston Bay.
In the first part of the deal, Antofagasta will invest a
minimum of $10 million over six years and earn a 50.1 percent
interest in Storm. In the second phase, the miner will invest
another $6 million over three years and take the project through
a feasibility study.
"Our agreement with Antofagasta will advance the Storm
project without significant dilution expected for Aston Bay's
shareholders and will leave Aston Bay with a meaningful interest
in the project," said Aston's Chief Executive Officer Benjamin
Cox, in a statement.
The two sides plan to sign a binding agreement by Dec. 1 to
finalize the deal.
The latest agreement came just a day after First Quantum
Minerals Ltd agreed to buy Lumina Copper Corp
for about C$456 million ($420 million) in a bid to win control
of the Taca Taca copper project in Argentina.
Despite a dearth of takeovers in the mining sector, copper
assets have been at the center of many of the mining deals that
have gone down within the last year.
In April, a Chinese consortium agreed to buy the Las Bambas
copper mine in Peru from Glencore Xstrata Plc for $6
billion. And Canadian miner Hudbay Minerals Inc has
been trying for months to buy rival Augusta Resource Corp
so it can get hold of Augusta's Rosemont copper project
The deals underscore the scarcity of high-quality copper
projects. The widely used industrial metal is expected to be in
short supply over the long term, as the project pipeline has
been significantly shrunken by lower prices and
shareholder-mandated austerity among the world's top miners.
($1 = 1.0853 Canadian dollars)
(Reporting by Euan Rocha; Editing by Jeffrey Benkoe)