Teck Agrees to Sell Pogo Interest

Teck Resources plans to sell its 40% interest in the Pogo gold mine in Alaska for $245 million. The mine produced
347,000 oz of gold in 2008. (Photo courtesy of Teck Resources).
Teck Resources announced on April 30 that it had entered into a non-binding memorandum of understanding (MoU) with Sumitomo Metal Mining regarding the proposed sale of Teck’s 40% interest in the underground Pogo gold mine in Alaska for $245 million subject to adjustment for working capital. Sumitomo Metal Mining holds an indirect 51% interest in Pogo, and an affiliate of Sumitomo Corp. holds a 9% interest.

Teck reported that the MoU with Sumitomo Metal Mining followed receipt by Teck of a third-party offer to acquire Teck’s interest in Pogo on comparable terms. Completion of the transaction remained subject to the negotiation and settlement of a definitive agreement and other conditions. Teck expects the transaction to close by the end of the second quarter.

The Pogo mine is located 145 km southeast of Fairbanks. Production totaled 347,000 oz of gold in 2008 (139,000 oz attributable to Teck). Current proven and probable reserves provide sufficient ore to maintain current production rates through 2016. Near-mine targets are being explored for possible additions to reserves.

The mining methods at Pogo are cutand- fill and drift-and-fill. The mill utilizes conventional milling, gravity and carbon-inpulp technology. Gold from both the gravity and carbon-in-pulp circuits is produced as doré bullion. Mine-site facilities include the mill, a permanent camp for 200 people, a water treatment plant and a paste backfill plant/dry-stack tailings facility.

As featured in Womp 2009 Vol 05 - www.womp-int.com