South32 ups stake in Arizona Mining

PERTH (miningweekly.com) – Diversified miner South32 will acquire an additional 15-million shares in TSX-listed Arizona Mining, taking its share in the Canadian company to 19.9%.

South32 in May this year acquired an initial 45-million shares, or a 15% interest in Arizona Mining, for an investment of C$110.3-million.

The company said on Friday that the new shares would be acquired by a third-party financial institution over the next 12 months, with final costs of the transaction to be determined at completion, and would be based on the daily volume-weighted average price of Arizona Mining shares over the period.

“Our continued support of Arizona Mining is aligned with our strategy to invest in high-quality mining projects where we can add value,” said South32 CEO Graham Kerr.

“This incremental investment increases our interest in the highly prospective Hermosa project, and demonstrates our commitment to work with Arizona Mining to unlock its full potential.”

Prefeasibility studies at the Hermosa-Taylor project, 80 km southeast of Tucson, show that the project will have a net present value of some $1.26-billion and an after-tax internal rate of return of 42%. The project currently has an 8.6-million-tonne measured resource, grading 4.2% zinc, 4% lead and 1.6 opt silver, as well as 63.8-million tonnes of indicated resource and 38.6-million tonnes of inferred resource.