Catalpa Resources (ASX:CAH) and Conquest Mining (ASX:CQT) will merge to form a new company, called Evolution Mining, as well as purchase Newcrest Mining’s (ASX:NCM) interests in the Cracow and Mt Rawdon gold projects in Queensland after shareholders showed their overwhelming support for the deals today.
Evolution Mining will be a growth-focused, asset diversified Australian gold company.
Catalpa and Conquest have high hopes for the new company, with expectations that Evolution will be a top five Australian gold producer with the scale, diversified asset base and management team to be a real force in Australia’s gold sector
Conquest shareholders overwhelmingly supported the merger of the two companies, with 99% of votes cast at the Conquest scheme meeting being in favour of the merger.
Meanwhile Catalpa shareholders overwhelmingly supported the purchase of Newcrest’s assets, with 99% of votes cast at the Catalpa extraordinary general meeting being in favour of the issue of new shares to Newcrest as consideration for the purchase.
A hearing in the Federal Court of Australia to approve the scheme of arrangement is scheduled for next Monday.
The assets - Cracow
Newcrest’s 70%-owned Cracow gold project (30% Catalpa) is located in central Queensland, Australia, about 4 kilometres from the township of Cracow and about 500 kilometres north-west of the city of Brisbane.
In 2002, the joint venture partners approved development of the underground mine and refurbishment and upgrading of the existing treatment plant.
Mine development began in December 2003 with first gold production kicking off in November 2004. Ore throughput capacity was successfully increased from 400,000 tonnes per annum to 550,000 tonnes per annum in March 2011.
Cracow has a total measured, indicated and inferred resource of 3.1 million tonnes at 6.3 grams per tonne (g/t) for 600,000 ounces of gold.
Newcrest’s 100%-owned Mt Rawdon operation is an open pit gold and silver mine and process plant located in south-east Queensland, about 80 kilometres south-west of Bundaberg. Gold production during 2009 was 107,780 ounces.
Indicated and inferred resources at Mt Rawdon total 37 million tonnes at 0.87g/t for 1 million ounces of gold.
Mt Rawdon has an estimated mine life of about 10 years at 100,000 ounces per annum, with the operation scheduled to continue until 2017 at current estimates.