BANGALORE— Canada’s Candente Copper Corp, which owns one of the largestundeveloped copper deposits in Peru, is ready to sell itself but only atdouble its current value, its chief executive said.
With copperprices rising, Canadian miners HudBay Minerals Inc and First QuantumMinerals have recently bought small Peru-focused miners, putting thespotlight on Candente’s Canariaco Norte copper project in the SouthAmerican country.
"There are many companies interested in buyingour project, but we would not sell at anything near our current marketcap ... we are working very hard to get a better valuation on our sharesright now," Candente’s co-founder and CEO Joanne Freeze told Reuters bytelephone.
The Canariaco project has a current resource base of10.3-billion pounds of copper equivalent, nearly a quarter of estimatedglobal copper demand this year. It is Candente’s primary project.
Canariaco is valued at nearly 2.5 cents a pound, Freeze said, or $250-million.
"It’sa robust project and copper is an attractive commodity right now," saidFreeze, who lived and worked in Peru in the mid-1990s and has headedthe mineral explorer for nearly 14 years.
She said many groups were interested in partnering with Candente on the project, but declined to give details.
Freezewants at least 5 cents a pound for the project, which is moving fromthe pre-feasibility stage, with commercial production targeted by 2015.
Theaverage price for such projects in Peru is about 3.8 cents a pound,said Stonecap Securities analyst Gary Hon, who values Canariaco at about2.4 cents a pound.
The Better Mine
InDecember, First Quantum completed the acquisition of Antares Minerals,which owns the Haquira project, and last month, HudBay agreed to buyNorsemont Mining Inc to get access to the Constancia copper project.
Canariaco stacks up well versus Constancia and Haquira, Wellington West analyst Steve Parsons wrote in a recent note.
Candente may spark interest from Chinese companies, given the increasing demand for copper and gold.
"Some of the obvious ones could be the Chinese as they’re quite interested in the region," said Hon at Stonecap Securities.
ZijinMining Group Co Ltd was cited as a potential partner for Candente in2006 to develop the Canariaco project, Hon wrote in a client note.
The cost of developing the mine is estimated at more than $1.4-billion, which raises funding issues, analysts said.
"I don’t see any funding restraints," said Freeze.
Candenterecently raised about $30-million, she said, and believes that PeruvianPension Funds — which has $22-billion to deploy — are a likely sourceof funds.
Candente’s shares were trading flat at $2.13 onWednesday afternoon on the Toronto Stock Exchange. The stock has risennearly five-fold in the past year.