Sep 2 - 8, 1996 Volume 82 Number 27 - 0 comments

Barrick buys into Arequipa

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Shareholders of Arequipa Resources (AQP-T) have tendered 93% of the outstanding shares of the company under the terms of the offer from Barrick Gold (ABX-T). Most Arequipa shareholders opted for the share exchange option; of the 33.7 million shares tendered before the offer's deadline, 70% were submitted for the share trade. Since Barrick's bid limited the number of new Barrick shares that would be issued in exchange, the shareholders who chose the trade option will receive 0.79 of a Barrick share and 50 cents cash per share for 72% of their shares, and $30 per share for the remainder.
The whole deal will cost Barrick $512 million in cash and 13.4 million shares. Barrick will be buying up the remaining shares in Arequipa through compulsory acquisition provisions in the securities laws.

Oct 14 - 20, 1996 Volume 82 Number 33 - 0 comments

Barrick looks to boost its gold production

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The assets of North America's biggest gold producer, Barrick Gold (ABX-T), continue to grow. Additional reserves at the Pascua mine, in Chile, and the Pierina project, in Peru, will boost Barrick's production figures significantly over the next few years, senior executives told an audience at the Denver Gold Show.
Gold reserves at the Pascua mine, in the northern portion of the company's Indio property, have increased by 18% (or 1.2 million oz.) to 7.7 million oz.
With this latest increase, reserves have more than doubled since the end of 1995, when they stood at 3.4 million oz. Initial production is projected at 400,000 oz. per year.
The deposit is open at depth, as well as to the east and south, said Alan Hill, executive vice-president of development. "Drilling will resume in October [springtime in Chile], and we fully expect to see Pascua's reserves rise substantially as a result."
Turning to the Peruvian project, Hill said Barrick is "more confident than ever that the decision to purchase [former Pierina owner] Arequipa Resources was well-justified.
"We based our acquisition on a minimum 4.5 million oz. gold at Pierina, but recent drill results make this number look conservative. By year-end, we plan to include Pierina in reserves and elevate the property to the development stage."
Initial production at Pierina is estimated at 500,000 oz. gold per year, beginning in 1999. Costs are projected to remain below $100 per oz., due in part to a substantial silver byproduct credit.
Hill also stressed the importance of the more than 50 Peruvian properties included in the acquisition of Arequipa, adding: "We expect these properties have the potential to host other Pierinas."

Jan 6 - 12, 1997 Volume 82 Number 45 - 0 comments

1996: A LOOK BACK -- Inco, Barrick swallow juniors, line investors' pockets

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By: Lawrence Kootnikoff

Huge mineral discoveries fueled a wave of mergers, takeovers and deals in the mining industry in 1996. The year's biggest story was Inco's (N-T) Aug. 21 swallowing up of Diamond Fields Resources (DFR), the Vancouver-based junior that went to Labrador looking for diamonds, only to find one of the largest nickel deposits in the world.
Falconbridge (FL-T) was the jilted suitor in the affair. After a prolonged courting dance, Inco and Diamond Fields settled on a merger worth about $4.5 billion, or $43.50 per DFR share.
The massive deposit at Voisey's Bay is estimated at 150 million tonnes, including a preliminary figure of 50 million tonnes grading 1.36% nickel, 0.6% copper and 0.09% cobalt in the Eastern Deeps zone. The reserve at the Ovoid zone, where the initial open-pit mine will be located, is 31.7 million tonnes grading 2.83% nickel, 1.68% copper and 0.12% cobalt.
Inco plans to build a US$1-billion smelting and refining complex to process nickel-cobalt concentrate. The complex will be near the town of Placentia, 130 km west of St. John's, on the island of Newfoundland.
Moving from the coast of Labrador to the mountains of Peru, one of the world's biggest gold companies grew larger when Barrick Gold (ABX-T) scooped up Arequipa Resources.
Barrick spent $512 million in cash and 13.4 million shares to get Arequipa's main asset, the Pierina gold property in northern Peru. The Toronto-based major snapped up the company on the basis of nine drill holes; no reserve has been established for the property.
Barrick is believed to also be on the verge of a deal with Bre-X Minerals (BXM-T), a junior that controls the massive Busang gold find on the island of Kalimantan. The deposit contains up to 57 million oz. gold, or a measured and indicated resource of 316 million tonnes grading 2.3 grams per tonne.