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Mining industry

Vengold Inc. Completes Acquisition of 10% Interest in Lihir Gold Project

Strategic Insights

— 2 min read

Vengold Inc. has successfully completed the acquisition of a 10% interest in the Lihir Gold Project from a subsidiary of RTZ Corporation Plc. The acquisition was made in exchange for $50,000,000, raised through a public offering of 28,863,000 units at $1.75 per unit. The Lihir Gold Project is a major undeveloped gold deposit located on Lihir Island, 700 kilometers northeast of the Papua New Guinea mainland, with a total geologic resource exceeding 40 million ounces of gold. The feasibility study for the project is based on a mineable reserve of 14.6 million ounces of gold, and construction is expected to commence immediately, with production slated to begin in late 1997 at an initial rate of 620,000 ounces of gold per year.

Key Takeaways:

  • Vengold Inc. has completed the acquisition of a 10% interest in the Lihir Gold Project from RTZ Corporation Plc. for $50,000,000.
  • The acquisition was made possible through a public offering of 28,863,000 units at $1.75 per unit.
  • The Lihir Gold Project is a major undeveloped gold deposit with a total geologic resource exceeding 40 million ounces of gold.
  • The feasibility study for the project is based on a mineable reserve of 14.6 million ounces of gold.
  • Construction is expected to commence immediately, with production slated to begin in late 1997 at an initial rate of 620,000 ounces of gold per year.
  • The estimated capital costs for the project are approximately $680,000,000, which will be financed entirely by bank loans and an international public offering of shares in Lihir Gold Company.
  • Vengold is continuing its exploration program on its properties in the Kilometre 88 region of Venezuela, with diamond drilling planned for the Oro Uno, Bizkaitarra, and Nueva Alaska properties.

Statistics:

  • $50,000,000: the amount Vengold Inc. paid for a 10% interest in the Lihir Gold Project.
  • 28,863,000: the number of units sold in the public offering.
  • $1.75: the price per unit in the public offering.
  • 40 million: the number of ounces of gold in the total geologic resource of the Lihir Gold Project.
  • 14.6 million: the number of ounces of gold in the mineable reserve.
  • 620,000: the initial rate of production in late 1997.
  • $680,000,000: the estimated capital costs for the project.
  • 1997: the year production is expected to commence.

Sources:

  • Business Wire, June 13, 1995
  • Vengold Inc. press release, June 13, 1995
  • RTZ Corporation Plc. press release, June 13, 1995
  • Lihir Gold Project feasibility study, 1995
  • Vengold Inc. press releases and reports, 1995.

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