COMMERCIAL Poseidon sets up joint venture

Press, Volume CXI, Issue 32706, 8 September 1971, Page 20

COMMERCIAL

Poseidon sets up joint venture

(N.Z. Press Association—Copyright)

SYDNEY, September 7.

Poseidon, Ltd, announced today that it had signed an agreement to enter a joint venture with the Union Oil Development Corporation, the Homestake Iron Ore Company of Australia, Ltd, and Australian Hanna, Ltd, at Mount Windarra, Western Australia.

The agreement is subject to the approval of the Govern ment of Western Australia. Poseidon will have a 50 per cent interest in the venture, Union 25 per cent, and Homestock and Hanna 12.5 per cent each.

Poseidon says it is unanimously agreed that it will be the operator of the joint venture, under a joint manageiment committee.

i The four parties strongly i believe that the most economic development of the two nickel suphide ore bodies known to date will be by joint venture, with a resultant sharing of the substantial supporting infrastructure facilities and combining of the financial and technical resources of the parties. Plans modified All mining tenements held by the parties within a defined 50-mile radius of Mount Windarra will be the subject area of the joint venture. Any new ore discoveries in tenements now held by the parties other than the two at present known will be subjected to a three per cent overriding royality from the joint venture to the present

title-holders, Poseidon on one -hand and Union-Hanna-Home-stake on the other. Adequate adjustment allowance has been credited to Poseidon by the other parties for the expenditure tacurred, by way of their own

or recent loan resources, the directors say. It will be necessary to modify earlier production plans to include the exploitation of the

Union - Hanna - Homestake South Windarra ore body, and the directors say that these modifications will be announced in due course. In the meantime, they say, underground development of the Mount Windarra ore body will be continued at present rates.

Discussions will be actively continued on the establishment of a nickel smelter to convert the joint venture nickel concentrates to matte. Hanna already owns and runs a nickel smelter at Riddle, Oregon, United States and its technical competence in this field will be available to the Joint venture, Poseidon says. The directors say that their policy has been to maintain maximum equity and Australian content in their explora-

tion of the Mount Windarra ore body. In view of the agreement, discussions with Australian Anglo-American, Ltd, referred to in the last quarterly report, have been suspended. Under the terms of the agreement with Anglo the amount owed to that company is not due for repayment until November 30.