AngloGold Ashanti and Latin Metals have inked a partnership for various mining projects in Argentina. The Vancouver-based miner and the South African gold giant entered into a non-binding letter of intent regarding Latin Metals’ Organullo, Ana Maria and Trigal gold projects in Salta Province, northwestern Argentina.
If the parties sign a definitive agreement, AngloGold will be granted the option to earn an initial 75% interest in the projects by making cash payments to Latin Metals in the aggregate of US $2.55 million. It would also have to spend US $10 million on exploration within five years of the execution and delivery of a final deal
“Securing joint venture partners is a key part of Latin Metals’ prospect generator operating model and we are pleased to have entered into the LOI with AngloGold, as a potential partner for our projects in Salta province,” said CEO Keith Henderson.
“Relatively advanced-stage exploration projects like Organullo require significant expenditures to assess the full potential of the project, which expenditures would otherwise need to be financed through dilutive equity financing,” Henderson noted.
Under the terms of the preliminary agreement, Latin Metals would retain a minority, but key position and will have the opportunity to participate with the multinational in a future joint venture, he said.
AngloGold has been shifting focus from the home country to more profitable mines in Ghana, Australia and Latin America as the industry in South Africa dwindles amid power cuts, soaring costs and the geological challenges of exploiting the world’s deepest deposits.
First production at the mine, which will produce gold and silver as by-products, is not expected until the second half of 2025. Throughput during the estimated 21-year mine life is put at around 6.2 million tonnes of ore per year with an average grade of 1.2% copper. The firm expects annual production of 3 billion pounds (1.36Mt) of copper, 1.5 million ounces of gold and 21 million ounces of silver over the mine life.