Why Navaho Gold is Moving to Acquire Argentine Coal Project
With the right location and right price, the acquisition of Excarb is an offer Navaho Gold can’t refuse
Navaho Gold is inching closer to acquiring Argentine firm Excarb, which owns the rights to several lucrative coal projects in Argentina.
The purchase would be a win-win situation for the Australian-based company as it would receive the rights to numerous coal projects in Argentina, including thermal and coking coal projects. The company would also gain access to developing markets for local Argentinean power generation, steel making, mineral processing, and export application, not to mention putting Navaho Gold in close proximity to existing rail networks with links to industrial areas and ports.
The coal projects have been identified for significant tonnages of thermal and coking coal in San Juan and Rio Negro provinces
Another motive for the deal is the price. According to sources, Navaho would purchase Excarb through the issue of more than 17.8-millon shares (with shareholder approval), allowing the company to retain its existing cash reverses. The transaction would also include an additional 140-million shares, over five tranches, on the completion of certain milestones.
The company informed shareholders it would conduct its own studies before the acquisition is made, including, mapping, sampling, drilling, and ore quality testing as well as prefeasibility studies over the next two years.
The depths and dips of the coals seams are ideal as it could be mined by open-cut methods, leading to lower-than-expected operating costs. This makes sense for any mining company but especially for Navaho Gold.
Incorporated in April 1995, Navaho Gold is partially-owned subsidiary of ASX listed DGR Global (DGR) and is primarily focused on the discovery of world-class gold deposits in New Mexico and Nevada, USA.
The acquisition of Excarb is an offer Navaho Gold can’t refuse. With no money out of pocket, low operating costs, potential for high coal reserves, and access to major markets, Navaho Gold is putting itself in the right position to expand.
Gerald Group resolves iron ore dispute with Sierra Leone
Gerald Group, the US commodity trader, will pay Sierra Leone $20mn and cede a 10% stake in an iron ore project as part of the resolution to a nearly two-year dispute that led to the shutdown of production, the two sides revealed.
Gerald's wholly-owned subsidiary SL Mining filed for arbitration in August 2019 over a royalty payment dispute and suspended the Marampa mine the following month. Sierra Leone's government responded by cancelling its mining licence.
As part of the agreement signed on Friday, Sierra Leone will take a non-dilutable 10% stake in a new company that will replace SL Mining and resume operations at Marampa by June 1, Gerald said in a statement.
Gerald will make two $10mn payments this year and will have the immediate right to ship its current stockpile of about 707,000 tonnes of iron ore, it said.
Both sides will withdraw their legal claims before the International Chamber of Commerce (ICC) and International Centre for Settlement of Investment Disputes (ICSID), the statement added.
Gerald’s chairman and CEO Craig Dean commented: "I am delighted that we have been able to resolve our differences and have a fresh start and new beginning with the government of Sierra Leone."
Sierra Leone's Mines Minister Timothy Kabba told a news conference on Tuesday that the agreement was a milestone for the country.
"Whatever the pain we may have borne or dreaded throughout these two years ... this outcome justifies our action," he said.
Gerald estimates that Marampa holds about 1 billion tonnes of iron ore with a potential lifespan of 30 years.
Back in 2019, Dean spoke with Mining about the development of Marampa and commented: "SL Mining offers a substantial opportunity for Gerald Group as our Marampa mine in Sierra Leone is producing two million tonnes per annum of high grade iron ore in the first phase of development, with expansion possibilities of greater than six million tonnes per annum of high-grade iron ore during its operational life. If you analyse the iron ore market it has transformed, even from a couple of years ago when prices were very low. Now prices have stabilised we’re in a favourable position with our first shipments leaving for China.
"Our goal is to make ‘Marampa Blue’ an internationally recognised premium grade iron ore brand. We intend to expand the delivery of high-grade 65% iron ore concentrate to markets in Europe and Africa.”