By David Winning

Owen Hegarty has swallowed the disappointment of watching Glencore International walk away from a US$475 million deal to buy a majority interest in a flagship Peruvian copper project—by lining up another suitor willing to pay a higher price.

CST Mining, where Mr. Hegarty is executive vice-chairman, has struck a US$505 million deal to sell its 70% stake in the Mina Justa copper project to Peru-listed Minsur following a sales process run by Morgan Stanley since the start of the year.

Selling the asset, which contains over 400 million tons of copper, means CST Mining will now concentrate fully on its Lady Annie operation in the Mount Isa region of Queensland state in the near term. The mine aims to produce up to 30,000 tons of copper in  the 2012 financial year.

The deal will help renew faith in Mr. Hegarty’s ability to find cheaply priced resources assets in overlooked regions of the world that can then be sold later at a premium.

He famously built Oxiana from a mining hopeful in 1995 to a multi-billion company on the ASX, starting out with the copper and gold Sepon mine in Laos, a previously unknown mining destination. Oxiana combined with Zinifex in a $12 billion deal to create OZ Minerals in mid-2008, just before the financial crisis gathered pace and triggered a cash crunch among many ASX-listed miners.

CST Mining, listed on the Hong Kong Stock Exchange, acquired the interest in the Mina Justa project when it took over Chariot Resources for 244.6 million Canadian dollars (US$246 million) in 2010, meaning it has roughly doubled its investment since then before accounting for capital expenditure on site.

However, Mr. Hegarty’s recent track record has been patchy. Russia-focused Tigers Realms Coal raised 37.5 million Australian dollars when it was spun out of Mr. Hegarty’s Tigers Realm Minerals and listed on the ASX in August last year, but its shares have lost nearly half the value and have never traded above the original offer price.

Mr. Hegarty told Deal Journal Australia the subdued performance by Tigers Realm Coal stock mirrors that of many mining peers, adding the company has ticked off successfully many of the plans outlined in its original listing prospectus, including increasing the resource base and additional drilling.

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