From Mineweb -
EXTORRE ON THE BOARDS
Exeter's gold company split now approved and going live
Canadian gold junior Exeter Resource Corp. has had its proposal to split into two separate companies approved to handle two very different types of gold deposit.
Author: Lawrence Williams
Posted: Saturday , 13 Mar 2010
SYDNEY -
High flying gold exploration junior, Exeter Resource Corp, has had the strategic split of the company into two separate entities approved by its shareholders. Exeter itself will now concentrate on the huge Caspiche gold/silver/copper project in the Maricunga region of the Chilean Andes, virtually halfway between Kinross' Maricunga mine (formerly known as Refugio) and Barrick's Cerro Casale project, while the spin-off company, to be called Extorre, will take on the group's Cerro Moro gold project, and other Argentinian gold exploration properties, with a view to bringing the former to production.
Mineweb first revealed the company's president, Bryce Roxburgh's, ideas to split in two last November - see Exeter's golden choices, and now this has come about with shareholder approval received with 99.83% in favour, with the final order agreeing the split granted by the Supreme Court of British Columbia on March 12th. The agreement should now be closed by March 22nd, with the distribution date for Extorre shares to Exeter's shareholders the day following. The shares have received preliminary approval for listing on the TSX, and while they are not yet to be listed on the NYSE-AMEX register, the new company plans to apply for listing on the OTCQX exchange for its U.S. shareholders and subsequently on the NYSE-AMEX. Listing is subject to Extorre meeting all listing requirements of those exchanges and receiving exchange acceptances of listing applications.
Exeter shares themselves will trade "ex-distribution" on the TSX on March 18, 2010 and on the NYSE-AMEX on March 24, 2010.
On closing, the new company, Extorre, will hold all of Exeter's former interest in the Argentinian Cerro Moro and Don Sixto Projects as well as its other Argentinian Patagonian exploration projects and an initial $25 million in capital from Exeter. Initial focus will be on development of the Cerro Moro Project, while exploration drilling will continue to test for new high grade vein targets. Exeter itself will continue to hold and focus on advancing its Caspiche Project.
Part of the reason for the split relates to the huge differences in project parameters between Caspiche and Cerro Moro and will enable two separate management teams to concentrate on two very different projects. Caspiche looks to be rivalling Barrick's Cerro Casale in size and grade, and so far has an inferred mineral resource estimate of 1,117 million tonnes at a grade of 0.55 grams per tonne gold and 1.12 grams per tonne silver including 1,017 tonnes at a grade of 0.22% copper. This equates to in-situ inferred resources of 19.6 million ounces of gold, 40 million ounces of silver and 4.84 billion pounds of copper (a total of 32.4 million gold equivalent ounces). The size of this deposit suggests a multi-billion dollar development to bring a large open pit to production and is therefore markedly different to the skills and financing necessary for the smaller Cerro Moro project.
The Cerro Moro project, as it is much smaller in scope and less costly to bring into production could be mined with a series of relatively small narrow open pits and by underground methods, being similar to AngloGold's Cerro Vanguardia which is relatively nearby in Argentina's Patagonia area. A mine here can be brought on stream relatively quickly by new company, Extorre, without necessarily having to bring in a jv partner. The current resource at Cerro Moro stands at 646,000 ounces gold equivalent at a grade of 18 grammes per tonne gold equivalent. This is almost entirely on the high grade Escondida vein, and with a number of other significant vein structures already delineated, the eventual resource will be very much larger. A new resource statement, which will still be primarily based on the Escondida vein drilling, is due next month.
The company split will enable two separate management teams to concentrate wholly on two very different types of projects, and is a move which Exeter management feels will strongly enhance shareholder value.
