PERTH (miningweekly.com) – Copper developer Metallum is seeking a buyer for its Chilean assets, including the El Roble project, as the company shifts its focus to advancing the Teutonic gold and base metals project, in Western Australia.

Metallum halted mining operations at El Roble in September, owing to falling commodity prices, a dramatic decrease of the Enami tariff for delivered ore and the anticipated removal of the copper price support mechanism by the Chilean government.

The company's board believed it would not be economically beneficial for the company to restart operations in Chile in the short to medium term, owing to the continued depressed copper price environment.

Following consultation with external advisers, the board also determined that the company was unlikely to be successful in raising the capital required to improve the project economics, such that restarting mining operations would become viable, in the existing climate.

As a result, Metallum would seek to dispose of its remaining Chilean assets.

The Chilean companies and the operations currently have liabilities of some A$295 000.

Metallum noted that, to quarantine the company from those and any future liabilities as a restructure and recapitalising was sought, the company’s former board, which included current chairperson Winton Wilesee and former directors Zeffron Reeves and Cobb Johnstone, would acquire Metallum’s Australian subsidiary, which holds the interest in the Chilean assets, for a nominal consideration.

The acquisition was conditional upon there being no superior bids from other parties, as well as shareholder approval.

Interested parties have been invited to make competing bids for the Chilean assets, in the interest of a transparent and fair disposal process.

Meanwhile, Metallum also announced the raising of up to A$2-million to assist the company in meeting its existing creditor obligations, to advance the Teutonic project and to review the best options for the Comval assets, in the Philippines.

The capital would be raised through the issue of 40-million new Metallum shares at a price of A$0.0005 a share and would be offered to existing shareholders on a 47-for-1 basis.

Following the completion of the capital raise, Metallum would proceed with a consolidation of its existing shares and options on a 400-for-1 basis.