Los Andes Copper Ltd is to indirectly acquire non-consumptive water rights for the Rocin River, which currently runs through the company’s mining claims in Chile, together with studies for the development of a 29MW run-of-river hydroelectric project.
Los Andes has agreed to issue Turnbrook Mining Ltd. (TBML) a total of 37,500,000 shares in the capital of the company at a deemed price of $14,450,000 or $0.39 per share in exchange for all of the issued and outstanding shares of DK Corporation, which owns all of the issued and outstanding shares of Rocin SpA, the registered and beneficial owner of the hydropower project.
Los Andes management believes that the acquisition of the hydro project will bring a number of important benefits to the company. Securing power at reasonable costs has become one of the key challenges for the mining industry in Chile, and the project will not only ultimately provide a portion of the power requirements for the company’s mine at a very low cost, but will also provide Los Andes with a regular source of cash flow until the power is required by the Company. These funds will help fund the mine’s pre-construction development and other ongoing costs, and reduce the need for future dilution of the Company’s shares.
