Austral Gold Acquires 51 Percent Stake in Chilean Mining Service
Austral Gold, a growing precious metals mining and exploration company, has acquired the controlling stake in Humberto Reyes Arriendo de Maquinarias, an underground mining contract. Humberto Reyes owns mining equipment and associated vehicles with a company value of around $4 million.
The acquisition – done through Austral Gold’s subsidy Guanaco – cost Austral Gold around $2.7 million; $450,000 was paid up front, the remaining balance will be paid in monthly installments over time.
Humberto Reyes has been working on underground contract mining at the site since 2011. There are several benefits for Austral Gold in this acquisition, including important annualised savings for Guanaco.
With many mining companies looking for footing in the South American mining landscape, Chile is a great foot in the door. Some believe that Latin America and Australia are natural partners for innovation in the industry.
A spokesperson for Austral Gold has said that the acquisition “is a strategic investment for [Austral], since it provides flexibility to accelerate mining of the Guanaco mine resource; allows greater control over safety and production practice at the mine; ensures competitive costs for underground development; and gives management greater overall control over the mine’s operations.”
Austral Gold director Stabro Kasaneva further went on to say that “[t]his transaction is a pleasing development for Austral Gold and represents key strategic investment in the further development of our flagship Guanaco project.”
Austral Gold now owns 51 percent in the company. With the current deal also comes the option to acquire the remaining 49 percent of company in two and a half years. A price would be agreed upon at a later date.
Vale invests $150mn to extend life of Manitoba operations
Vale has announced a $150mn CAD investment to extend current mining activities in Thompson, Manitoba by 10 years while aggressive exploration drilling of known orebodies holds the promise of mining well past 2040.
Global energy transition is boosting the market for nickel
The Thompson Mine Expansion is a two-phase project. The announcement represents Phase 1 and includes critical infrastructure such as new ventilation raises and fans, increased backfill capacity and additional power distribution. The changes are forecast to improve current production by 30%.
“This is the largest single investment we have made in our Thompson operations in the past two decades,” said Mark Travers, Executive Vice-President for Base Metals with Vale. “It is significant news for our employees, for the Thompson community and for the Province of Manitoba.
“The global movement to electric vehicles, renewable energies and carbon reduction has shone a welcome spotlight on nickel – positioning the metal we mine as a key contributor to a greener future and boosting world demand. We are proud that Thompson can be part of that future and part of the low carbon solution.”
Vale continues drilling program at Manitoba
Coupled with today’s announcement, Vale is continuing an extensive drilling program to further define known orebodies and search for new mineralization.
“This $150mn investment is just one part of our ambitious Thompson turnaround story. It is an indicator of our confidence in a long future for the Thompson operations,” added Dino Otranto, Chief Operating Officer for Vale’s North Atlantic Base Metals operations.
“Active collaboration between our design team, technical services, USW Local 6166, and our entire Thompson workforce has delivered a safe, efficient and fit-for-purpose plan that will enable us to extract the Thompson nickel resources for many years to come.”
The Thompson orebody was first discovered in 1956 by Vale (then known as Inco) following the adoption of new exploration technology and the largest exploration program to-date in the company’s history. Mining of the Thompson orebody began in 1961.
“We see the lighting of a path forward to a sustainable and prosperous future for Vale Base Metals in Manitoba,” said Gary Annett, General Manager of Vale’s Manitoba Operations.