Anglo American has advised Highlands Pacific that it intends to withdraw from the Star Mountains exploration joint venture in Papua New Guinea.
Following a review of its global exploration portfolio, Anglo American has given notice that it will withdraw from the project in 30 days, and in accordance with the terms of the joint venture, will relinquish its vested 15% holding in the project, leaving Highlands with a 100% interest.
Highlands Managing Director Craig Lennon said that, while he was disappointed that Anglo American would not be continuing with the joint venture, its involvement over the past three years had greatly enhanced the understanding of the geology of the tenements and substantially increased the value of the project.
"We will now be free to introduce a new partner to continue exploration efforts," he said. "Drilling to date has confirmed extensive mineralisation through the various prospects that have been tested to date, and we remain confident that further exploration will identify the source and structure of the mineralisation sufficiently to support a significant development project."
Anglo American and Highlands established the joint venture in February 2015 and since then Anglo American has funded an extensive exploration program including two diamond drilling campaigns.
Anglo American has spent a total of US$38 million on the project including a US$10 million payment to Highlands Pacific for its initial entry into the project. This comes on top of significant funding by various project participants since the initial discovery by Kennecott in the late 1960s when they found Ok Tedi's Mt Fubilan deposit.
The Star Mountains exploration tenements, which include Nong River EL1312, Tifalmin EL1392, Mt Scorpion EL1781, Benstead EL2001, Mt Abemh EL2467, Ilam River EL2478 and Lake Louise EL2517 cover 1049 sq kms and are located approximately 20km north east of the Ok Tedi mine and 25kms from the support town of Tabubil, in the West Sepik Province of PNG.