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PERTH (miningweekly.com) – ASX-listed Alliance Resources on Monday rejected a A$57.6-million offer from its joint venture partner Quasar Resources to gain full control of the Four Mile uranium project, in South Australia.
The offer was made for Alliance’s 25% share of the project and for its share of the uranium oxide (U3O8) concentrate already produced at the mine.
However, Alliance said on Monday that internal and external valuations had estimated the value of its share of U3O8 concentrate mined to the end of December at about $20-million, meaning that Quasar’s offer was significantly below fair market value.
Quasar has indicated that it was not prepared to increase its offer price.
Alliance said that the company remained open to selling its interest in the project, should an appropriate offer be made.
In November last year, Alliance made the decision not to contribute to the 2015 capital expenditure planned for the Four Mile project, after the budget was passed without its support, and after Quasar refused to sell Alliance’s share of the Four Mile product, depriving the company of funds it would have used to defray its share of expenses.
As a result of the decision, Alliance would have no outgoing association with the Four Mile project until January 2016, and the company’s interest in the Four Mile project would be reduced from 25% to about 15% by the end of December 2015.