Gold Fields exercised its 40% option in the gold-copper Far Southeast project in the Philippines after making a $110-million payment recently. During September 2010, Gold Fields entered into two option agreements with Lepanto Consolidated Mining Co., 60% owner of Far Southeast, and Liberty Express Assets, 40% owner of Far Southeast, granting Gold Fields an option to acquire a 60% interest in Far Southeast for a total consideration of $340-million.
After making two down-payments of $44-million and $66-million in September 2010 and September 2011 respectively, Gold Fields has decided to bring forward half of the remaining $220-million payment to acquire Liberty’s 40% interest in Far Southeast.
Gold Fields continues to hold its option to acquire an additional 20% stake in Far Southeast from Lepanto for a further $110-million, which, if exercised, would increase its total interest in Far Southeast to 60%.
Nick Holland, Gold Fields CEO, said: “We are extremely pleased that we now own a 40% interest in Far Southeast, not just an option. The positive drilling results have given us the confidence to show our commitment to the project and the Philippines.”
Far Southeast is located in the northern part of Luzon, the largest island in the Philippines. The project is situated in an existing mining camp in close proximity to two other mines historically operated by Lepanto, one of which is currently in production. Far Southeast has ready access to established infrastructure, including roads, tailings facilities, power and water. The existing workforce on the doorstep of Far Southeast is part of a community established around mining over the past 70 years.
Gold Fields also expects to have a maiden Resource statement for Far Southeast and commence a pre-feasibility study later this year.