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PANAUST (ASX:PNA) is set to acquire Glencore’s stake in the Frieda River Copper-Gold project in Papua New Guinea, after clearing a final hurdle.
Located on the border of the Sandaun and East Sepik provinces, the site is one of the largest undeveloped copper and gold deposits in the world.
The Brisbane-based mining company satisfied a condition precedent under the share sale and purchase agreement to secure 80 per cent interest in the project.
Highlands Pacific Limited will hold the remaining 20 per cent, while the PNG government has the right to claim a 30 per cent – potentially reducing PanAust’s stake to 55 per cent.
PNA will pay $26.9 million once the transaction is finalised and reimburse Glencore for its expenditure on the site dated since November 2013.
The next payment of $53.9 million is scheduled for 31 December 2015.
PNA says the acquisition is a strategy to access sufficient mineral resources for sustainable growth beyond its Phu Kham operation in Laos.
The deal is expected to be finalised on August 25.
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