First Quantum acquires BHP's Australian nickel mine for $340 million

The world's biggest mining company, BHP Billiton agreed to sell its shuttered Ravensthorpe Nickel Operation to Canadian copper miner First Quantum Minerals Ltd (First Quantum) for $340 million.

First Quantum Minerals Ltd., a growing mining and metals company, is engaged in mineral exploration, development and mining in Africa. It produces LME grade "A" copper cathode, copper in concentrate, gold and sulphuric acid. First Quantum's shares trade on the Toronto and London stock exchanges and the company is a mmeber of the S&P / TSX 60 index.

Within a year of starting the Ravensthorpe Nickel Operation in Western Australia, BHP had closed the mine in January 2009, as it was just not profitable with nickel prices having dropped to a historic low at $4.85 a pound or $8,810.00 per tonne in late 2008.

The Anglo Australian miner had then incurred a whopping writedown of $3.7-billion on the project, where it had spent $2.2 billion in building it.

First Quantum, listed on the Toronto Stock Exchange and the London Stock Exchange said that it intends to undertake further review work with a view to recommencing operations at Ravensthorpe.

In addition to the purchase price, BHP said that the Vancouver, British Columbia-based First Quantum's proposal was compelling having regard to their financial and operational capability, and their offer's minimal conditionality and immediate acceptability.