The royalty specialist company Royalco Resources Ltd (ASX: RCO) is still pondering an offer deemed as a possible takeover from its major shareholder.
This was being considered after key shareholder Fitzroy River Corporation Ltd (ASX: FZR), with which it shares some directors and accommodation, presented this concept in the previous quarter.
This follows Royalco’s decision earlier this year to try and sell its 1% interest in the Weeks Royalty on oil and gas production in Bass Strait.
The company said a non-binding proposal from Fitzroy River gave a valuation of this royalty of $A6.6 million. This was “materially higher” than other offers under the sale process.
Royalco said its cash balance at the end of June from mineral and petroleum projects in Australia was $A2.06 M, compared to $A2.194 M at the end of March.
Royalco retains a royalty right to South Island gold projects operated by OceanaGold Corporation or originally held by that miner. This includes Blackwater in the Reefton goldfield which OceanaGold has joint ventured to private company Tasman Mining.
Royalco also cited the Sams Creek project which MOD Resources Ltd (ASX: MOD) had earned 80% interest from OceanaGold, but exploration was placed on ice in the tough market times of three years ago.
Royalco said MOD and OceanaGold had assigned Sams Creek to Condamine Resources, but as NZResources reported last week that Perth-based company failed to produce an IPO and the agreement lapsed.