Patagonia goes Canadian « Mining Blog

Patagonia goes Canadian

8. December 2011,

“It has taken about a year, but on Wednesday shares of Patagonia Gold PLC will be listed on the Toronto Stock Exchange” noted Barry Critchley in the Canadian Financial Post (FP).

But despite having a market capitalization of more than $600-million, it is hard to see how this company could deliver “production”, other than by a small test plant in Lomada de Leiva, Santa Cruz (Bill Humphries, chief executive of the gold company, set a target of 200,000 ounces of production by 2015).

Patagonia Gold has been proudly mentioned as a “national” company by the Mining Secretary of Argentina, Jorge Mayoral. It was formed after Brancote Holdings sold the Esquel project to Meridian Gold in 2002. According to FP, “another goal of listing on the TSX is to increase the ownership of Patagonia held by North American investors. Currently it’s about 7% but figures can at least triple that”.

Patagonia Gold is fairly tightly held:

The Miguens family from Argentina has a 38% stake; BlackRock 9.5%; Insiders 6%; Barrick 3.5%; and Van Eck 3.5%.

The company failed to develop the Huemules project near Esquel, Chubut, after the Meridian debacle in 2003.

In response to massive protests, the government passed a ban on mining exploration in the western part of the province (where the Huemules project is located) in 2005.

Patagonia Gold also owns vast concessions in the central part of the province, near Pan American Silver’s Navidad project. In the same area, Lonmin Plc developed the Angela mine (once the third producer of gold in Argentina), closed back in 1992. Sir John Craven, former director of Lonmin Plc, is now on the board of Patagonia Gold.

For the Spanish version of this posting, see:

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