PERTH (miningweekly.com) – Junior Comet Resources has struck a deal with diversified major Glencore to acquire the Mt Margaret copper project, in Queensland, and has announced plans to raise A$50-million.

Under the terms of the agreement, third-party company Minerals Mining and Metallurgy (MMM) will pay Glencore subsidiary Mount Isa Mines (MIM) A$5-million as a non-refundable payment, while Comet will issue 25-million shares in the company to MIM or its nominee, at an aggregated deemed issue price of 20c a share.

Additionally, Comet has entered into a share sale agreement with MMM to acquire all the shares in the company, in exchange for 73.55-million shares in Comet and 36.77-million options.

The Mt Margaret project successfully produced from an openpit mine from 2012 until 2014, when operations were suspended owing to the copper price environment and outlook at the time. The project has a Joint Ore Reserves Committee-compliant resource of 13-million tonnes, at 0.78 g/t copper and 0.24 g/t gold.

“Acquisition of the Mt Margaret copper project is a truly transformational event for Comet. Mt Margaret is a substantial past-producing copper mine that we’ve been able to acquire due to portfolio rationalisation of a global tier one mining company,” MD Matthew O’Kane commented.

“It contains existing mineral resources of 13-million tonnes at approximately 1% copper equivalent, with over 95% of this resource in the measured and indicated categories. The majority of Mt Margaret’s resource sits in two already pre-stripped openpits providing reduced capex pathways to production.”

To fund the acquisition and to assist the company in re-complying with the ASX listing rules, Comet will undertake a public offer, subject to shareholder approval. The company has appointed Euroz Hartleys as lead manager, but the offer will not be underwritten.

The company is hoping to raise A$50-million under the public offer, which will be priced at 20c a share.