Mining: Yamana bids for embattled Extorre
Yamana Gold Inc. (TSX: YRI) announced it is seeking to acquire Vancouver-based Extorre Gold Mines Ltd. (TSX: XG) in a friendly takeover valued at $414 million. The bid is valued at $4.26 per share – a 54% premium on the 20-day volume weighted average price – which is a far cry from Extorre’s 52-week high of $14.84 or even its trading above $6 throughout the first quarter. In a research note, David West, Salman Partners analyst, says it’s the best of a bad-case scenario: “There is a high probability for other offers given the price paid for Cerro Moro.”
Gas: Fort Nelson First Nation signs
Two agreements between the province and the Fort Nelson First Nation aim to strengthen land-use certainty and spur development in northeastern British Columbia, especially natural gas activities in the Horn River Basin. The first, the Economic Benefits Agreement, provides the Fort Nelson First Nation with a share of the revenue generated from resource development in its treaty territory. The second, the Oil and Gas Consultation Agreement, establishes a clearer process and timelines for consultation and management of lands and resources.
Forestry: Catalyst secures second vote
Catalyst Paper announced on June 18 that it has received court approval to hold a vote on its revised plan of arrangement. Catalyst will try to gain necessary support among secured and unsecured creditors at a June 25 meeting to be held at Delta Vancouver Airport Hotel. The amended plan includes $7 million more in additional annual savings. Creditors rejected the previous plan May 23 by a 3% margin. Catalyst said certain holders of unsecured notes who previously voted against the plan, or abstained, have indicated that they will support the new arrangement.
Gas: Apache big on B.C. discovery
It has to be big for a producer to tout an exploration discovery, and Apache Corp.’s (NYSE, Nasdaq:APA) Liard Basin property in northern B.C. certainly fits. In a recent investor presentation, Apache’s John Bedingfield said a six-stage frack returned a 30-day, initial production of 21 million cubic feet per day of gas, which he believes to be the “most prolific shale gas resource test in the world.”
He added that the Liard Basin could also be the highest quality shale reservoir, with an estimated 48 trillion cubic feet of marketable gas.
“Staggering numbers,” he said.
Mining: Baja facing court action over timing of disclosure
A Baja Mining Corp. (TSX: BAJ) shareholder is alleging the company delayed disclosing cost overruns of its Boleo copper project. Paris-based shareholder Louis Dreyfus Commodities Metals Suisse S.A., which owns 5.2% of Baja, is suing the company and demanding an independent investigation into cost overruns. Louis Dreyfus alleges the $246 million in estimated cost overruns were intentionally disclosed only after management narrowly defeated a group of dissidents. Baja said in a news release it intends to defend this action vigorously.
