We have the great news from McEwen Mining, you can Google for the whole news release. Before the value for Los Azules was based on the acquisition price paid by US Gold for Minera Andes. After the collapse in Gold prices and Argentina troubled couple of years this accounting value has became the wishful history. Now based on the valuations of Taca Taca in First Quantum Minerals takeover of Lumina Copper McEwen Mining will make the conservative accounting valuation of Los Azules. Normally the selling price for the assets is above such an assessment. You will have to make your own numbers or contact Jim Mustard at PI Financial, who is acting on behalf of TNR Gold.
"We are conducting an impairment test of our Los Azules project in
Argentinaas a result of the recently announced acquisition of Lumina Copper Corp.by First Quantum Minerals Ltd., for approximately C$470 million. Lumina's only significant asset is the Taca Taca copper project located in Salta, Argentina. While there are some notable differences between Taca Taca and Los Azules, we believe the similarities in project scale and location within Argentinawarrant consideration for the Lumina transaction to be a triggering event for impairment analysis. Our preliminary analysis, which places a substantial weighting on the announcement day value of the Lumina transaction to value Los Azules, indicates a pre-tax asset impairment charge in the range of approximately $90-135 million(1). The actual amount, when we have completed the final impairment assessment, will be reported in our quarterly 10-Q which is due to be filed on August 7, 2014.
"With First Quantum acquiring
Lumina Copperand their Taca Taca project, Los Azules moves to the forefront in terms of world-class, undeveloped, high-grade copper assets not owned by a major mining company. As we have said in the past, Taca Taca serves as a good proxy for the value of Los Azules and we believe this transaction demonstrates value in projects located in Argentina", said Rob McEwen, Chief Owner, Chairman and CEO.
"Chile, Indonesia, USA, Australia and Canada together account for 80% of the world’s copper supply, and with the revived interest in the metal, many national companies are now making headlines with plans of acting to relieve demand pressures and ease supply shortfalls, signalling the potential turnaround and the major bottom in this mining cycle anticipated in the copper market. Read more."
All slides in this part of the post are from McEwen Mining presentations.
End of slides from McEwen Mining presentations.
As we have discussed before, we have really Hot Winter In Argentina for mining M&A. Now Frik Els confirms "China's Top Gold Firm Talking to Barrick Gold, Has Friedland "hotline":
Investments in "politically stable" countries in Latin America and Africa are also being considered Song said. Mining.com"
"Frik Els provides a very good insight into the Chinese deal culture and mining M&A particularly. Las Bambas deal is not only the very good indicator of the turning mining cycle, but also provides guidance for the smaller companies in China to go on The Hunt For Copper and other commodities. You can witness this approach in our particular case of Strategic Commodities with International Lithium and Ganfeng Lithium as well. Read more."