Gold Fields, the world's fourth largest gold miner, said on Wednesday it had made a non-refundable down payment of $66 million for an option to acquire a 60 percent interest in an undeveloped gold-copper deposit in the Philippines.
The company said in a statement that if it decided to take the option a final payment of $220 million was expected to be paid during the first half of 2012. It had already paid $54 million prior to the $66 million payment.
As the down payments are non-refundable the company is taking a risk with capital that could be put to use in a range of other ways.
But chief executive Nick Hollands said drilling results showed promise.
We are pleased with the results to date and excited at the prospect of establishing a long-standing mutually beneficial relationship in a promising region in the Philippines, he said.
The project is in the northern part of Luzon, the largest island in the southeast Asian archipelago, and Gold Fields said it has ready access to established infrastructure, including roads, tailings facilities, power and water.
Gold Fields aims to get 60 percent of its global output from outside South Africa by 2015, up from 50 percent now.
South African gold miners are keen to reduce their exposure to their home base because of growing mine depths, rising costs and political risk, including talk of nationalisation espoused by radical elements of the ruling African National Congress.
Bullion's record run is also driving renewed exploration and project development, while gold miners are keen on copper resources due to the metal's long-term bullish outlook based on strong Asian demand.