Oz Pulls Out of Jv With Legend
OZ pulls out of JV with Legend
LEGEND Mining announced today that OZ Minerals has decided not to proceed further with the Mt Gibson zinc-copper-gold joint venture.
In May 2007, Legend announced it had signed a farm-in and joint venture agreement with OZ (then Oxiana), giving OZ the right to earn 75% interest in the project by spending $10 million on exploration over seven years.
OZ met the first phase of the agreement by spending the minimum expenditure requirement of $1.2 million in the first 18 months, after which it had the option to withdraw.
Legend managing director Mark Wilson said the company understood the reasoning for OZ's decision to withdraw from the JV.
'Both parties to the joint venture contemplated the possibility of this outcome when drafting the joint venture agreement,' he said.
'The drilling completed by OZ Minerals has provided valuable information in defining the prospective 'zinc horizon' which can be used in planning any future activities.'
The Mt Gibson Project comprises 215 square kilometres of exploration and mining tenements, and a gold mine with associated plant and infrastructure that is on care and maintenance.
Legend will regain 100% ownership of the project, 290 kilometres northeast of Perth.
Wilson told MiningNews.net that the company will assess its priorities before deciding on the next course of action.
'I suppose, to be perfectly frank, it's more of a thinking time until we can work out what our expenditure commitments really are and where we would choose best to spend that money,' he said.
The company currently has $12 million in cash.
'We can handle what we've got in front of us in any circumstance,' Wilson said.
OZ recently announced it was conducting a strategic review of its portfolio and expenditure. The company will now reassess its database and aim to define additional resources.
In September OZ pulled out of the Wilcherry Hill lead-zinc-silver JV with Trafford Resources.
Last month, the company withdrew from the Menninnie Dam JV with Terramin Australia, as well as a JV with Drake Resources covering properties in Sweden and Queensland.
Shares in Legend Mining were unchanged at 7c this morning, while OZ Minerals were down 6% or 5.5c to 83c.
