Chalice on hunt with $100m war chestKate Emery, The West...

Chalice on hunt with $100m war chest
Kate Emery, The West Australian February 7, 2012, 7:51 am


Chalice on hunt with $100m war chest

Chalice Gold Mines has given itself until the end of the year to use a $100 million war chest to acquire a new project. It has Africa, South America and Australia on its radar.

Chairman Tim Goyder said Chalice, which is in the process of selling its stake in the Zara Eritrean gold project to China's SFECO, hoped to have the proceeds in the bank by May and was already on the lookout for likely targets.

"I've got a lot of meetings lined up," Mr Goyder told _WestBusiness _.

Mr Goyder said Chalice's experience lay in Africa and gold but it was keeping an open mind. He did not rule out picking up another project in Eritrea, where Chalice has exploration assets.

"We're not looking at grassroots projects," he said. "We want (a project) close to production or that has some good hits in it. We think there are still opportunities around."

The Chinese have until mid-March to complete due diligence on Zara and Chalice is expected to take the deal to shareholders in May. Mr Goyder said the company would make an acquisition this year.

Consolidation among Africa's gold juniors has been talked about ad nauseam but has yet to materialised on a significant scale.

Most of the bigger African deals have involved other commodities, such as Barrick and Equinox Minerals (copper), Exxaro Resources and African Iron (iron ore) and China Guangdong Nuclear Power Corp and Extract Resources (uranium).

BDO corporate finance partner Sherif Andrawes said he expected to see an increasing number of partnerships based around the need for funding, particularly in the gold sector.

"My feeling is it's going to be a year of consolidation," he said.
Chalice managing director Doug Jones will address the Mining Indaba conference in Cape Town today.