Financial Daily from THE HINDU group of publications
Tuesday, Nov 23, 2004
Financial Daily from THE HINDU group of publications Tuesday, Nov 23, 2004 |
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Corporate
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Alliances & Joint Ventures Deccan Gold signs exploration pact with De Beers Our Bureau
Bangalore , Nov. 22 DECCAN Gold Mines of Australian origin and De Beers India of South African parentage have mutually granted exploration rights in each other's licensed areas across the country. They also propose to form a new joint venture with 5 per cent share to the other if their exploration in the other's area reaches the mining stage. The five-year joint venture agreement enables Deccan Gold to explore for gold in De Beers areas, while De Beers can look for diamonds on the other's areas, Mr Sandeep Lakhwara, Managing Director, Deccan Gold Mines, said here on Monday. Each company is entitled to get from the other 1.5 per cent gross revenue royalty from any production derived from the areas, which have been relinquished and over which the data has been supplied, capped at $10 million (about Rs 47 crore). There are no restrictions on the marketing of gold or other minerals produced by the joint venture. But all diamonds produced must be marketed through De Beers. Deccan Gold has also been conditionally offered the right of first refusal over diamond deposits. "The joint venture partners can earn a 95 per cent interest in their commodities of interest on each other's ground by meeting expenditure targets proportional to the size of individual permit areas covered by the agreement. Exploration data will also be exchanged between the companies on areas that have been relinquished by the other," according to DGML. The BSE-listed Deccan Gold is the country's first listed gold exploration company and arm of Australian Indian Resources Co. It is exploring in the Dharwad-Shimoga belt, Hutti, Mangalur and in the Ramagiri block of Andhra Pradesh. De Beers India is a subsidiary of the world's largest diamond mining company and holds prospecting licences for some 30,000 sq km in various States. Australian major AIR holds 81.20 per cent stake in DGM through its Mauritius-based subsidiary, Rama Mines (Mauritius) Ltd. The Indian public holds the remaining 18.80 per cent shares.
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