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OZ Minerals Limited (ASX:OZL) is into the metals and mining sector. It is a modern mining company with a focus on copper. The principal activities of the company include mining of copper-gold and silver, exploration activities and development of mining projects. The company has several segments including Prominent Hill, Carrapateena, Exploration & Development and Corporate Development.
On 30 January 2019, the Board of Red Metal Limited announced the execution of a significant, multi-project option and joint venture agreement with OZ Minerals Limited. This JV is primarily aimed to enhance the search for greenfield discoveries on the companyâs highly sought-after Australian base metal exploration portfolio.Â
OZ Minerals has shown a strong commitment to regional exploration in Australia. It is one of Australiaâs premier mining companies and is an owner of the Prominent Hill copper and gold mine in South Australia coupled with developing the nearby Carrapateena copper and gold deposit.
The new Greenfields Discovery Alliance agreement will allow OZ Minerals to have a two-year option to fund a series of mutually agreed, proof-of-concept work programs. These programs include six of Red Metalâs exciting early-stage projects namely Yarrie, Nullarbor, Gulf, Three Ways, Lawn Hill, and Mount Skipper. Under the agreement, OZ Minerals commits to expend a minimum amount on each project within the two-year span. Their total commitment is for $8.05 million.
After the completion of the minimum expenditure commitment on a project, OZ Minerals can opt to form a joint venture over that project and can earn 51.0% by spending the designated Earn-In Amount on exploration within the designated Earn-In Period.
The head of Exploration and Growth of OZ Minerals, Richard Holmes said that the alliance between the two companies has been carried out based out of their experience gained by working together on the Punt Hill project near the Carrapateena copper project, which is currently under construction.
Red Metal has strong technical ability, a collaborative approach to ventures and external stakeholders, with an entrepreneurial spirit. The projects under the alliance provide a rare opportunity to gain access to large land holdings in terranes with significant mineral endowment and frontier terranes with low-cost programs to test new concepts.
Now let us quickly have a look at the OZ Minerals Limitedâs stock performance and the return it has posted over the last few months. PZLâs share traded at $9.50 with the market capitalization of ~$3.11 billion. The stock opened at $9.650 with its day low of $9.50; however, the dayâs high price touched $9.885. The stock has generated a YTD return of 11.12% and posted returns of 1.27%, 9.60% and 8.98% over the last six months, three months and one-month period respectively. It has a 52-week high price of $10.700 and a 52-week low of $8.08, with an average volume of 1.38 million approximately. The stock is trading at a PE multiple of 10.30x, with an EPS of AUD 0.931. It has an annual dividend yield of 2.29 percent.
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