JOHANNESBURG (miningweekly.com) – Canadian miner Teck Resources has sold its 76.56% interest in the Stonepark zinc project, in Ireland, to base metals explorer Group Eleven Resources (G11), according to joint venture (JV) partner Connemara Mining.
Connemara chairperson John Teeling previously said the explorer was keen to have a partner with “deeper pockets” and on Wednesday welcomed the news of G11 as its new partner.
“This is very good news for shareholders. Stonepark is an advanced asset, which we believe has great potential, a view shared by our new partner G11."
Dublin-based G11 recently also bought Teck’s 60% interest in the Ballinalack zinc project, in Westmeath and Longford. Teck and fellow Canadian miner MAG Silver hold 6.3% and 22%, respectively, of the equity of G11 on a fully diluted basis.
G11, which is preparing to publically list in Canada later in 2017, paid C$2.15-million in cash and a 4.5% net smelter return (NSR) royalty with buyback provisions for Teck’s interest in the Stonepark exploration project. Assuming all the buyback provisions are exercised, Teck will have a 1% NSR.
Connemara had an option to also sell its stake on the same terms as Teck, but opted to retain its 23.44% shareholding in the six prospecting licences, near Limerick. Assuming NSR buybacks, Connemara would have received C$2.80-million and a NSR of 1%, which represents about 75% of its current market capitalisation.
“Rather than accept a cash and royalty offer from G11, we have decided that the best interest of shareholders lies in keeping the 23.44% interest in Stonepark . . .. We look forward to a resumption of active exploration on the block," Teeling said.
The Stonepark project is a few metres away from Glencore’s Pallas Green project, which is Ireland’s largest zinc/lead resource.
The Ballinack project is the second-largest undeveloped zinc/lead resource in the country and about 50 km west of Boliden’s Tara zinc operation – Europe’s largest zinc mine.