Los Andes Copper Ltd has received conditional approval from the TSX Venture Exchange (TSXV) to indirectly acquire non-consumptive water rights for the Rocin River, which currently runs through the Company's mining claims, together with studies for the development of a 29MW run of river hydroelectric project.
Los Andes has agreed - in a share deal with Turnbrook Mining Ltd - to acquire DK Corporation, which owns Rocin Spa, the registered owner of the hydro 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 hydro power project not only has the potential to provide a portion of the power requirements for the company's mine, but could also provide Los Andes with cash flow until the power is required by the company. Funds generated by the project could also help fund the mine's pre-construction development and other ongoing costs, and potentially reduce the need for future dilution of the Company's shares.
Completion of the deal is subject to agreement on and completion of formal documentation, due diligence, and the approval of all governmental and regulatory authorities, shareholders and third parties, including the approval of disinterested Los Andes shareholders.