Global mining and research company SNL Metals & Mining says that 2014 saw a “welcome” improvement in mining asset transactions, with the company recording 73 acquisitions that were individually valued at over $10-million.

In a recent report, entitled ‘Base Metals and Gold Acquisitions Activity, 2005–14’, SNL calculates that prices paid in these deals totalled $21.56-billion, compared with $11.88-billion in 2013. SNL, nonetheless, notes that, despite the near-doubled year-on-year increase, 2014’s total was the third-lowest in the past ten years, with only 2013 and 2009 (at $14.88-billion) being lower.

For the past few years, mining companies have been cautious with regard to acquisitions, and since 2012 have bought fewer assets that require large capital investment. Instead, SNL says, companies have opted to ensure they receive the maximum value through their existing assets and entered into joint ventures (JVs) that reduced costs, while ensuring these operations maintained production volumes.

“Last year’s jump in total takeover value came entirely from the acquisition of base metals assets, such as copper, nickel and zinc, which rose from 24 deals priced at only $3.11-billion in 2013 to 29 deals priced at $13.08-billion in 2014.” The company points out that the total amount paid for gold acquisitions was “essentially the same” year-on-year at $8.48-billion in 44 deals, compared with 2013’s $8.78-billion in 61 deals.

Further, SNL states that the $13.08-billion spent on base metals acquisitions last year was more than three times the amount spent in 2013. “The average cost of these base metals acquisitions in 2014 was $451-million, compared with $210-million in 2013 and $1.17-billion in 2012.

This increase was almost entirely as a result of copper, with the spending on nickel increasing by only 4% and zinc acquisitions tumbling by 73%,” the company says. SNL highlights that copper deals accounted for 23 of the 29 base metals deals and about 97% of the price paid, which equated to $12.67-billion for 68.5-million tons of copper in reserves and resources.

Additionally, four nickel deals totalled $381-million for 2.5-million tons of nickel, and two primary zinc deals were priced at a total of $26.2-million for 2.1-millions tons of contained zinc metal. “The total price paid in these base metals was 2.2% of the value of the contained metals in the assets acquired, which was higher than the 1.2% recorded in 2013,” SNL noted.

The company also points out that, of the combined 73 base metals and gold acquisitions in 2014, over a third of (26) were by Canada-based companies.

These deals were valued at over $9.02-billion, representing 42% of the total value of acquisitions. “Another 13 deals totalling $7.52-billion were made by Australian companies and seven deals totalling $41.32-billion were undertaken by companies headquartered in China,” SNL concludes.