North-West Queensland copper producer Austral Resources Australia has locked in the third pillar of its revitalisation strategy with the settlement of its Lady Loretta acquisition from Glencore.
Acquisition of the now mothballed zinc mine boosts Austral’s tenure position surrounding its Lady Annie mine, delivering a near-term ore source in the form of a planned pit wall cutback planned to begin this quarter as well as longer-term opportunities.
“Lady Loretta is the third and final pillar in our revitalised strategy,” Austral Resources (ASX:AR1) chairman David Newling said.
“Six months ago we were suspended from ASX with very little money in the bank. Fast forward to today, and we’ve acquired two assets, raised over $100 million in fresh equity from investors, and are debt free.
“We’re on our way to becoming the next mid-tier copper powerhouse and consolidating the NW Queensland region.”
The three pillars include bolstering feed and extending the life of Austral’s Mount Kelly SX-EW operations, acquiring the Rocklands processing plant, and acquiring Lady Loretta.
The Lady Loretta transaction terms saw Austral receive $55.94 million from Glencore, with about $14.4 million applied to cash-back the estimated rehabilitation bond.
Austral assumes progressive rehabilitation obligations and will pay Glencore a 2.5 per cent net smelter return royalty on all copper oxide and sulphide production from the Lady Loretta tenements.
It will enter into an offtake agreement with Glencore for all copper products derived from the tenements.
