Atlas eyes polymetallic producers in Bolivia

In hopes of regaining its producer status, Atlas (AZ-N) plans to buy four mines in Bolivia.

The company signed a letter of intent to acquire Arisur, a joint venture company owned by Arimetco International (ARX-T) and privately held Suramco, at a cost of US$3.2 million. Arisur owns the Andacaba and Don Francisco mines, and holds options to acquire an 80% interest in the San Matias and Capillani mines.

The Andacaba, a silver-lead-zinc producer south of the city of Potosi, operates at the daily rate of 220 tonnes. Ore is processed at the Don Roy mill, which is undergoing expansion to 460 tonnes per day. A second mill, operating at the daily rate of 200 tonnes, could process ore from Andacaba, as well as additional material from the Don Francisco mine.

The San Matias and Capillani mines, which also host silver-lead-zinc mineralization in the Potosi area, are scheduled to enter production in 1997.

Included in the San Matias purchase option is another mill, capable of yielding 900 tonnes per day.

According to Gary Davis, president of Atlas, restoration of the company’s status as an operator is an important step in the development of its gold assets.

Connected with the proposed deal is a US$1.8-million loan (to be applied against the purchase price) advanced by Atlas to Arimetco. If the transaction falls through, however, the loan is repayable within 180 days. Atlas has 90 days to complete due diligence on the deal.