Ecuador-focused SolGold (LON, TSX: SOLG) has named former BHP executive Darryl Cuzzubbo as the company’s new boss, as the junior works to improve relations between the board and its largest shareholder.
Cuzzubbo, who will take over on December 1, previously served as chief manufacturing supply officer at explosives maker Orica, where he moved in 2015 after a 24-year career at BHP.
He is replacing Keith Marshall, who served as interim CEO when co-founder Nick Mather stepped down from the post earlier this year after some 45% of shareholders opposed his re-election. He continues to sit on the company’s board.
The rebellion was led by Cornerstone Capital Resources (TSX-V: CGP), its joint venture partner in the company’s flagship Cascabel copper-gold project in Ecuador.
The parties made peace in June, ending a two-year standoff with an agreement to jointly develop the touted asset, located on the northern section of the Andean Copper Belt, which accounts for nearly half of the world’s copper production.
BHP owns 13.5% of the company, and the prospects of a takeover are likely to increase once SolGold’s long-delayed pre-feasibility study is complete, experts say.
Ecuador’s Energy Ministry said in 2019 that it “could become the largest underground silver mine, third-largest gold and sixth-largest copper in the world.”
Once developed, Cascabel is expected to produce an average of 150,000 tonnes of copper, 245,000 ounces of gold and 913,000 ounces of silver in concentrate per year during its 55-year life-of-mine.
Over the first 25 years of mining, the average annual production is expected to be 207,000 tonnes of copper, 438,000 ounces of gold and 1.4 million ounces of silver.
BHP has reportedly been pushing to put SolGold’s entire board up for re-election at the AGM, which is scheduled in December.
Chairman Liam Twigger recently proposed that in order to maintain stability at the company, only three of the directors who did not stand for re-election last year, and the company’s new CEO, would face a vote at the shareholder meeting. The six other board members, including Mather, who were re-elected last year would not.
Ecuador has gained ground as a mining investment destination over the past two years, but opposition to the extraction of the country’s resources could thwart the government’s plan to attract $3.7 billion in mining investments by next year.
Last year, mining in Ecuador generated $810 million in exports, $430 million in taxes and $374 million in foreign direct investment.