Trevali Mining’s (TSX:TV) shareholders approved Thursday a planned acquisition of Glencore’s two African zinc mines, in a transaction that makes of the Canadian miner one of the few multi-asset, low-cost global zinc producers.
The acquisition of about 80% of Rosh Pinah mine in Namibia and a 90% stake in in the Perkoa mine in Burkina Faso, will help the Vancouver-based firm’s total production double to about 410 million pounds per year.
The deal also includes gives Trevali an effective 39.24% interest in the Gergarub project in Namibia, an option to acquire the Heath Steele property in Canada, and certain related exploration properties and assets, it said in the statement.
Rosh Pinah opened in 1969 and is expected to have a further 14 years of operating life, while Perkoa is set to produce for another six years.
Trevali, with operations in Canada and Peru, said the acquisitions will propel it to top-10 global zinc producer status, creating a premier pure-play zinc miner with sector-leading leverage to the commodity.
Zinc was one of the best performing commodities last year, climbing up 60% as a few top mines, such as Lisheen in Ireland and Century in Australia, closed down and miner including Glencore and Nyrstar suspended some production.
In contrast, this year prices have been under pressure partly due to weaker demand from China, the world’s top consumer of the metal, and growing geopolitical tension, which have spoiled investors’ appetite for risky commodities.
Analysts, however, remain positive on the metal’s outlook as the market remains undersupplied and LME inventories continue to shrink.