Sumitomo Metal Mining to Buy Additional 40% Share in Pogo Gold Mine

Sumitomo Metal Mining announced on Thursday the firm purchases Teck Resources’ 40% interests in Pogo gold mine in Alaska, of which Sumitomo Metal Mining controls 51%, under the basic agreement with Teck Resources. The transaction values US$ 245 million. They expect the transaction will complete by end of June. The gold mine is owned 100% by Japanese companies when Sumitomo Corporation already has 9% share in the mine.

Pogo mine is around 145 kilometers southeast of Fairbanks. The mine is the first majority holding offshore mining project for Sumitomo Metal Mining. The mine is partly owned by SC Minerals America, which is Sumitomo Corp.’s subsidiary, and Teck Resources. They developed the mine fir around US$ 378 million starting operation in February 2006. The mine produces annual 11-12 tonnes of gold. The mine has 109 tonnes of reserve as of end of 2008.

The mined ore is treated in cyaniding leaching and electrolytic metallurgy processes to make dore with around 94% gold and 6% silver.

Teck Resources operated the mine. With the acquisition, Sumitomo Metal Mining will manage and operate the mine. The mine will become the first mine with majority share and own operation for the firm.