Heathgate buys out Alliance in Four Mile project
One of Australia's most prospective low-cost uranium resources is now set to be wholly-owned by its partner and neighbour Heathgate Resources, which is part of US-based General Atomics.
Alliance Resources announced today that it had accepted a revised offer from Quasar Resources Pty to purchase all of Alliance Craton Explorer Pty's (ACE's) interest in the Four Mile uranium project, in South Australia, including ACE's share of uranium oxide concentrates already mined, for a total consideration of AUD 73.975 million ($54.97 million). Alliance made the announcement, signed by its managing director Steve Johnston, via the Australian Stock Exchange today.
Four Mile was originally owned by Alliance, but Heathgate (through Quasar, a subsidiary) farmed in to own 75% and control the project. As exploration has proceeded, that share is now greater, since Alliance's liquidity was constrained by Heathgate's decision to stockpile product rather than sell in the present market. Uranium from Four Mile in situ leach liquor is recovered in a satellite plant, and the loaded resin is trucked to Heathgate's central plant 10 km away.
Four Mile has confirmed resources of 27,000 tonnes of uranium, and for a further deposit close by an exploration target of 27,000 to 31,000 tU. If confirmed, this makes it one of Australia's prime resources.
The sale is subject to shareholder approval, the consent of the South Australia Minister to the transfer of the tenements and the Commonwealth Treasurer having no objection to the acquisition of ACE's interest in the project by Quasar.
Alliance said its board unanimously considers the transaction to be in the best interests of Alliance shareholders and recommends that shareholders approve it. A notice of meeting is being prepared and will be forwarded to shareholders as soon as reasonably possible. It is expected that the meeting will take place in late August.
In February, Alliance rejected a AUD 57.6 million ($44.7 million) offer from Quasar for its 25% interest in the Four Mile project, ahead of announcing an updated exploration target for the prospective Four Mile North East project. Alliance said that its board considered Quasar's offer to be "significantly below fair value". Alliance said that, based on a spot market price of US$38.38 per pound U3O8, ACE's own share of uranium concentrates mined at Four Mile to the end of 2014 has a market value of about AUD 20 million ($15.5 million).
Researched and written
by World Nuclear News
