March 17, 2011 / 1:40 PM / 7 years ago

UPDATE 1-Minera Andes to spin out Argentina copper project

(In U.S. dollars)

TORONTO, March 17 (Reuters) - Minera Andes MAI.TO said on Thursday it plans to spin out its Los Azules copper project in Argentina into a new publicly traded company.

The Toronto-based exploration company said the move will let it unlock value from Los Azules and allow it to focus on developing its San Jose gold-copper project, which is located in the vicinity of Goldcorp’s (G.TO) recently acquired Cerro Negro project in Argentina.

Minera Andes is headed by Rob McEwen, who was the founder and former chairman of Goldcorp, the world’s second largest gold miner by market capitalization. McEwen, who also heads other junior mining companies, owns about 31 percent of Minera Andes.

The company said that based on its preliminary assessment, the Los Azules project could produce about 375 million pounds of copper annually over a 25-year mine life. The project is expected to cost roughly $2.9 billion to build.

Under the terms of the spin-out offer, shareholders of Minera Andes will retain their common shares in Minera Andes and will be entitled to receive one common share of the new company for every share of Minera Andes held. (Reporting by Euan Rocha; editing by Peter Galloway)

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