ASX-listed Queensland nickel explorer AusNiCo has announced a proposed merger with Taronga Mines to create a company with an advanced-stage tin project with a suite of complementary nickel sulphide, copper and gold projects. Taronga currently holds a 100% interest in the Taronga tin project in New South Wales plus approximately 360km2 of adjacent exploration licences prospective for tin and other minerals. The deal, subject to shareholder approval, is based on the exchange of five AusNiCo shares for one Taronga one, valuing Taronga at A$6.9 million. As part of the merger Taronga CEO Peter Williams will assume the same role at AusNiCo.
A pre-feasibility study on the Taronga Tin Project large low grade project was completed by Newmont between 1978 and 1983, but no further progress was made after the mid-1980s tin price crash. Extensive metallurgical test work carried out at the time, including pilot plant trials, had demonstrated: the amenability of the ore to pre-concentration, upgrading the ore to a concentrator feed of approximately 0.46% Sn, 0.18% Cu and 11g/t Ag; a predicted tin recovery of 69%; and an average tin concentrate grade of over 55% Sn.
Recent work by Taronga indicates various areas of upside potential, including higher in-situ grades, especially at depth, the potential for high recoveries using modern comminution and gravity separation equipment, by-product copper and silver credits and exploration potential at the other nearby deposits. The company intends to progress the development of its suite of assets in 2013, including a proposed drilling program and the completion of a scoping study at the Taronga tin project.
