Antipa Minerals stock jumps 14% following A$17m sale of Citadel stake to Rio Tinto

Antipa Minerals Limited’s share price surged by 14% following its announcement of a A$17 million cash sale of its 32% non-controlling stake in the Citadel Joint Venture Project to its joint venture partner, Rio Tinto Exploration Pty Ltd. The deal is expected to strengthen Antipa’s cash reserves significantly, allowing the company to redirect resources into its 100%-owned Minyari Dome Gold-Copper Project, located in the highly prospective Paterson Province of Western Australia. This strategic move has boosted market sentiment, driving up Antipa Minerals’ stock on the Australian Securities Exchange (ASX).

The Citadel Joint Venture, which covers 1,200 square kilometres in Western Australia, contains an extensive mineral resource estimate, including 2.84 million ounces of gold, 173,000 tonnes of copper, and 2.1 million ounces of silver. Rio Tinto’s investment in the project has exceeded A$47 million, resulting in its current 68% stake. Antipa’s decision to sell its share not only provides immediate liquidity but also positions the company to focus more intensively on developing its Minyari Dome Project, which is seen as its flagship asset.

Cash Windfall to Propel Minyari Dome Project Forward

With the sale set to be finalised by November 2024, Antipa Minerals expects to have approximately A$23 million in cash reserves. Managing Director Roger Mason stated that the transaction provides “an extremely solid financial foundation from which to accelerate the development” of the Minyari Dome Project. The newly acquired funds will support ongoing exploration and drilling efforts at Minyari Dome, which is believed to hold significant gold and copper potential.

The Minyari Dome Project hosts an estimated 2.2 million ounces of gold, and the company has announced an aggressive drilling programme aimed at resource expansion. This phase is expected to commence in Q4 2024, coinciding with an updated scoping study for Minyari Dome, due to be completed later in September 2024. These advancements could further elevate the project’s value and attract more investor interest.

Strategic Focus on Core Assets Drives Positive Market Sentiment

The divestment from the Citadel Project reflects a strategic decision by Antipa Minerals to concentrate on its core assets. The A$17 million cash infusion from Rio Tinto allows the company to channel resources into the Minyari Dome Project, which is wholly owned and has substantial growth potential. According to Mason, Rio Tinto was the most logical buyer for the Citadel stake, given its existing majority position and significant investment in the project.

By capitalising on carried forward tax losses, Antipa Minerals expects to avoid any tax liabilities from the transaction, effectively maximising its cash reserves. This financial strategy underlines the company’s commitment to fiscal prudence while pursuing growth opportunities.

Expert Opinion: A Calculated Move for Long-Term Gain

Industry analysts have praised Antipa’s decision to sell its non-core asset to focus on the high-potential Minyari Dome Project. By divesting from Citadel, Antipa can allocate more resources and attention to a project where it holds 100% ownership, allowing for greater control and upside potential. One mining analyst remarked, “This move aligns with market trends favouring companies that streamline operations and concentrate on core assets. Antipa is making a calculated bet on the Minyari Dome Project’s potential to deliver substantial returns.”

Antipa Minerals Shares See Significant Uptick

The market has responded positively to the news, with Antipa Minerals’ stock price rising 14.29% to $0.016 following the announcement. The stock has shown a consistent upward trend over the past month, gaining 45.45%, and a one-year increase of 28%, outperforming both its sector and the ASX 200 index. Despite a year-to-date decline of 5.88%, the recent developments have revitalised investor confidence.

As Antipa Minerals advances its plans for the Minyari Dome Project and leverages the financial benefits of the Citadel sale, it stands poised for potential growth in one of Australia’s most promising mining regions.