Vedanta to sell Mt Lyell Copper Mine in Australia to New Century Resources
Vedanta Limited said that its fully-owned subsidiary — Monte Cello BV (MCBV) has agreed to sell Copper Mines of Tasmania (CMT), the owner of the Mt Lyell Copper Mine in Australia, through an option agreement with New Century Resources.
The Mt Lyell Copper Mine is a small copper asset, which has been placed on care and maintenance for the past five years and is not considered to be strategic for Vedanta due to its size and country presence.
After an internal strategic review, Vedanta took a decision last year to sell Copper Mines of Tasmania through a global sale process in order to get a capable operator and potential owner for assessing and eventually restarting operations at the Mt Lyell Copper Mine.
The Mt Lyell mine has been operation since the 1890’s and was acquired in 1999 by Monte Cello BV. Under the ownership of Vedanta, the Mt Lyell Copper Mine operated for more than 15 years. However, the copper mine in Tasmania was put into care and maintenance in 2015 after a couple of safety incidents as well as a depression in the copper market.
The option agreement’s terms include a minimum expenditure commitment of $10 million over the two-year period by New Century Resources. The capital will be spent on development and exploration along with reimbursement of existing care and maintenance activities, with an option of the right to scrap the agreement after 12 months.
The deal is conditional on full-form documentation, which is anticipated to be signed by the end of this month.