Officials at BHP Billiton announced plans to sell their Pinto Valley copper mining operation along with the associated San Manuel Arizona Railroad Co. to the Capstone Mining Corp. for $650 million by the end of Q2 2013.
BHP Billiton workers at the 100%-owned Pinto Valley and San Manuel will, in turn, become Capstone employees, as BHP Billiton representatives praised the deal. “It is consistent with our strategy,” said BHP President, Copper, Peter Beaven. “We are pleased—particularly given their commitment to environmental and safety standards.”
Capstone CEO Darren Pylot was also enthusiastic. “Pinto Valley represents a unique opportunity to acquire a mid-sized copper mine with a significant mineral resource,” he said. “This acquisition is consistent with Capstone’s strategy of building an intermediate copper producer focused in the Americas.”
Pinto Valley is an open-pit operation 125 km east of Phoenix in Arizona’s Globe-Miami district. The San Manuel Railroad Co. owns and operates a 47 km railway from San Manuel to Hayden. The project is forecast to produce up to 150 million lb of copper in concentrate and some 10 million lb in copper cathode annually. The asset also contains by-product molybdenum and silver, at a cash cost of $1.80/lb, for the first five years of production.
Capstone Mining is a Canadian base metals miner focused on copper, with two producing copper mines in Zacatecas State, Mexico, and in Yukon, Canada. In addition, Capstone has joint development projects in Chile in partnership and British Columbia, along with exploration properties in Canada, Chile, Mexico and Australia.