TORONTO (miningweekly.com) – The acrimonious relationship between Panama-focused gold miner Petaquilla Minerals and project developer Inmet Mining had deepened with the two companies at loggerheads about land-use rights adjacent to Inmet’s giant Cobre Panama copper/gold mine.
Inmet on Thursday issued a statement in which it conceded for the first time that it needed access to the Rio San Juan and La Esperanza concessions to build a significant portion of its tailings facility for the Cobre Panama project.
Inmet affirmed that in terms of Law No 9 of February 26, 1997, passed by the National Assembly of Panama, which established the regime under which Inmet subsidiary Minera Panama was to develop and operate the Cobre Panama project, it was eligible to use lands that were not located on its concession. It held that Annex IV of Law 9 provided that Minera Panama was entitled to receive access to the surface and subsoil of “adjacent concessions".
However, Petaquilla on Friday pointed out that the decision of the National Authority of Land Administration of Panama dated October 18, found that some of the land of the more than 7 500 ha adjacent to Minera Panama’s concession it had applied for, fell within the Rio San Juan and La Esperanza concessions, for which Petaquilla had already applied for, or had been granted to Petaquilla.
Further, Inmet said Petaquilla had previously granted it surface and related rights on areas comprising the "adjacent concessions", in order to build Cobre Panama infrastructure, provided that Minera Panama confirmed that such areas did not contain economically extractable mineralisation.
To that effect, Minera Panama in April 2010 provided drill results to Petaquilla. However, Petaquilla on Friday said it believed the drilling was inadequate to prove whether there was an economically feasible resource present on the contested lands, owing to too few holes having been drilled and that they were drilled too shallow and spaced too far apart.
Petaquilla, which operates the Molejon gold mine near to the Cobre Panama project, maintained it continued to believe that Minera Panama would not be able to locate the tailings facility for its Cobre Panama project in the proposed locations without its agreement.
Meanwhile, Petaquilla was forced to waive the shareholders rights plan with regard to the $140-million hostile takeover offer by Inmet, following a ruling by the British Columbia Securities Commission on Wednesday, ordering it to do so.
INMET LIFTS Q3 RESULTS
Inmet had lifted earnings in the third quarter, ended September 30, by 19% to $116.5-million or $1.68 a share. Revenue was up by 29% year-on-year at $327-million, the result of increased copper production from its mines in Spain, Finland and Turkey. During the quarter, copper production increased by 37% to 29 700 t, zinc production was down 31% at 15 800 t and pyrite production was up 16% at 234 300 t.
The company reported a 13% increase in the cash cost to produce copper at 78c/lb.
Inmet stocks were up 6.77% at C$56.17 apiece and that of Petaquilla also rose 6.67% to 64 Canadian cents apiece in afternoon trading on the Toronto bourse.