TORONTO (miningweekly.com) – Toronto-based Inmet Mining and Panama-focused miner Petaquilla Minerals on Monday reached a $150-million commercial agreement for the companies’ projects in Panama.
Under a binding term sheet, the two companies have resolved a number of issues related to aggregate procurement, land access and use, settlement of certain claims, waiving of royalties to be received by Inmet, and camp site procurement for the mutual benefit of Inmet subsidiary Minera Panama’s (MPSA's) and Petaquilla's mining operations, in the district of Donoso, Panama.
The agreement, which requires a definitive agreement to be concluded, provided for MPSA buying between $75-million and $100-million of aggregates over a three-year period for use in construction of the $6.2-billion Cobre Panama project.
MPSA would also lease from Petaquilla certain lands that would be used for temporary and permanent camp space for the Cobre Panama project at a yearly rental of $1.3-million.
Inmet had also agreed to drop certain claims against Petaquilla.
Petaquilla and Inmet, former joint venture partners, have successfully negotiated other arrangements in the past, namely the 2005 Molejon gold project agreement, which led to Petaquilla's gold mining operations at its Molejon gold deposit.
The two companies’ deal came as Vancouver-based First Quantum attempts to acquire Inmet through a $5.1-billion hostile takeover bid that expires on Wednesday.
Inmet Mining in December said it had increased the proven and probable reserves at its 80%-owned Cobre Panama project by 27%.
The additional mineral reserves from the Balboa, Brazo and Botija Abajo deposits increased Cobre Panama's total estimated contained copper to about 26-billion pounds.
The estimated contained gold had also increased by 41%, to about 7.3-million ounces.
Inmet’s shares closed down 2.8% at C$65.52 apiece, and those of Petaquilla rose 4% to 52 Canadian cents apiece.