Chinese companies to acquire Canada's Corriente Resources for $651 million

China Railway Construction Corporation (CRCC) and Tongling Nonferrous Metals Group Holdings Co have proposed to acquire Canada's copper and copper-gold explorer and developer Corriente Resources Inc for C$679 million ($651 million) with the aim of securing copper resources in South America.

Vancouver-based Corriente is a copper and copper and gold development and exploration company, which holds a 100 per cent interest in 17 deposits in the four main mining regions of the approximately 62,000 hectares in the Corriente Copper Belt southeast of Ecuador.

The Belt currently contains four copper and copper-gold porphyry deposits of Mirador, Mirador Norte, Panantza and San Carlos, which collectively have proven copper ore reserves of 11.54 million tonnes.

The Mirador Norte deposit alone has indicated resources of 171 tonnes of 0.51 per cent copper and 0.09g/tonne gold, and was advanced to the feasibility stage in April last year. The deposit will produce around 30,000 tonnes of copper per day while the Panantza resource holds an estimated 463 tonnes of inferred resources 0.66 per cent grading copper.

In October 1999 and April 2000, Corriente entered into two option agreements with Australian mining giant BHP Billiton, where Corriente acquired the option to acquire a 70 per cent interest in the mineral exploration properties in the Rio Zamora valley in southeast Ecuador.

China's biggest railroad builder CRCC and the country's second-largest copper producer Tongling have agreed to acquire all of Corriente's outstanding shares for C$8.60 per share in cash, representing a 27 per cent premium to Corriente's 30 trading days' average to 24 December 2009.