The Toronto Stock Exchange experienced a broad trading range during the July 8-14 report period, with the TSE 300 composite index easing off 1% to 7,387.06 points. The metals-and-minerals sub-index sunk 3.6% as it slid to 3,405.24 points, while the gold-and-precious-metals sub-index even fared worse, dropping 4.5% to 5,867.89 points.
During the week, Inmet finally closed a deal to sell its stake in the huge Antamina copper-zinc project in Peru. Under the transaction, which has been green-lit by the Peruvian government, Rio Algom and Noranda will each own 37.5% of the project, while Teck will own the remaining 25%. Noranda and Teck each acquired 25% of the project from Inmet, which received $70 million for its interest, and will receive future payments from Noranda and Teck equivalent to 3.33% of free cash flow from the project. Noranda will acquire an additional 12.5% on an earn-in basis. Noranda and Teck will fund the next US$41.4 million of project expenditures. Following this period, each of the three shareholders will be responsible for its proportional share of the project’s total funding requirement, estimated at US$2.2 billion. The partners must decide whether to go ahead with the project or return the property by Sept. 16, 1998. For the week, Rio Algom was off 15 cents to $20.75, Noranda was down $1.85 to $23.35, Teck was up 65 cents to $15.75 and Inmet Mining was down 20 cents to $4.60.
Inco was down 30 cents to $18.85 as the nickel giant struck a deal to sell off its alloys division to the American firm Special Metals for roughly US$408 million. The sale requires regulatory approval, which is expected in the next two months.
Other base metal majors posted losses for a second consecutive week.
Falconbridge was down 60 cents to $15.90, while Boliden shed 15 cents to close at $7.65.
Gold prices slumped US$1.55 to US$292.80 on the London morning fix of July 15.
The drop dragged down most of Canada’s major gold miners. Barrick slipped $1.20 to $26.90; Placer Dome was down 95 cents to $16.30; Kinross Gold dropped 20 cents to $4.65; TVX Gold shed 47 cents to $4.08; Cambior lost 40 cents to hit $8.40; and Agnico-Eagle Mines plummetted $1 to hit $7.30.
The hottest junior on the eastern markets was Meridian Gold, whose shares soared $2.05 to $6.30 as the company announced plans to go ahead with development of a combined open-pit/underground mine at its El Penon project in northern Chile. Montreal-listed Orleans Resources spent another week hovering about 95 cents, just 10 cents shy of its 2-year low.
Be the first to comment on "MINING MARKETS & INVESTMENT NEWS – EASTERN MARKETS — Base metal majors’ shares slump as Antamina deal closes"