Placer Dome wins bid for Africa gold mining company

Gary Park, Petroleum News Calgary correspondent

Vancouver-based Placer Dome recently beat out two rivals in a friendly $255 million takeover of Australia’s East African Gold Mines, a deal that gives the firm access to “one of the fastest growing areas for gold exploration and investment,” said Placer CEO Jay Taylor.

East African owns the North Mara open-pit gold mine in northern Tanzania that is expected to produce 220,000 ounces a year at cash costs of $200 an ounce and total costs of $252 an ounce.

Placer plans to spend $25 million upgrading a nearby mill and $3 million a year on exploration to boost annual output to 300,000 ounces for more than 10 years.

AngloGold and Gold Fields were competing bidders for East African, losing out to Placer’s offer of $3.015 a share in cash.