King-king miner eyes intro listing at PSE

MANILA, Philippines - Canadian miner St. Augustine Gold and Copper Ltd., is pursuing a secondary listing in the local bourse by way of introduction in the second half of 2014 to raise funds for its King-king copper-gold project in Compostella Valley.

The company is the partner of local firm Nationwide Development Corp. (Nadecor) in the pre-development of the $2 billion mining project.

St. Augustine is listed on the Toronto Stock Exchange.

“We see the completion of a cross listing in the second half of next year,” St. Augustine country director Clyde Gillespie told reporters yesterday.

Company officials declined for the moment to disclose further details on the listing plans such as the capital amount to be raised.

In preparation for the listing, Nadecor and St. Augustine inked an agreement for the restructuring  of their respective interests in the King-king project.

Once the transaction is closed, St. Augustine would have full ownership of the milling company which would be responsible for the milling and processing of all ore produced from the project.

In compliance with Philippine investment law, the mining company would be 60 percent owned by Nadecor and 40 percent owned by St. Augustine.

The mining company would sell ore to the milling company which would process the ore and sell it to interested parties.

Under the agreement, St. Augustine assumes full responsibility for organizing the financing for the project.

Nadecor president Conrado Calalang said the boards of the company and St. Augustine both approved the restructuring.

He said St. Augustine’s “strategic” Philippine partner Queensberry Mining and Development Corp. has also signed the restructuring documents as a sign of support.

Queensberry, controlled by the Villar family, owns 18 percent of St. Augustine.

“This is a significant development because it moves toward consolidation...We are looking forward to listing in the PSE,” said Calalang.

The closing of the transaction is subject to approval from the Toronto Stock Exchange. St. Augustine shareholders would also be entitled to vote on the proposed transaction during the annual general meeting of shareholders tentatively slated for Dec. 16, 2013.

Company officials believe the restructuring would attract more Asian investors into the project because of the significant Filipino shareholding.

“From a strategic perspective, we believe the new structure increases the attractiveness of the project to potential strategic partners supportive of bringing King-king into production as as soon as possible,” said St. Augustine CEO Andrew Russell.

The King-king copper-gold project is expected to produce 3.1 billion pounds of copper and 5.43 million ounces of gold over its 22 year mine life.

Results of the preliminary feasibility study released by the company last month showed that the porject has a pre-tax net present value of $2 billion with an estimated pre-tax internal rate of return of 24.8 percent.

The mineral reserve amounts to 617.9 million tons at 0.300 percent copper and 0.395 gram per ton of gold.

The project is seen to begin operations between 2015 to 2016.