Lundin Mining to amass Josemaria Sources for $483 million

“In our view this venture is a singular and scarce alternative,” Lundin Mining CEO Peter Rockandel mentioned throughout a convention name with analysts and buyers on December 20.     

“Lundin Mining has been following Josemaria’s developments right into a world-class ore physique for a substantial time period.”   

The acquisition would enhance Lundin Mining’s copper and gold manufacturing by 50% and 140% respectively, in comparison with its 2022 manufacturing steerage of 258,000 to 282,000 tonnes of copper and 153,000 to 163,000 oz. of gold.  

The Josemaria venture is among the many top-ten open-pit copper tasks within the Americas, when it comes to whole mineral reserves, in response to Rockandel. As soon as in manufacturing, it’s anticipated to churn out over 130,000 tonnes of copper, practically 225,000 oz. of gold and 1 million oz. of silver a yr over a 19-year mine life, based mostly on a November 2020 feasibility research. The venture is predicted to start out business manufacturing in 2026.     

The feasibility research estimated the venture would generate a post-tax web current worth of $1.53 billion and a post-tax inside charge of return of 15%.   

The venture has confirmed and possible mineral reserves of 1.01 billion tonnes grading 0.22 gram gold per tonne,  0.94 gram silver per tonne and 0.30% copper, for 7.02 million oz. of contained gold, 30.72 million oz. of contained silver and 6.71 billion lb. of copper.   

Josemaria Sources submitted its Environmental and Social Affect Evaluation (ESIA) earlier this yr and expects it will likely be authorized in 2022. 

Adam Lundin, Josemaria’s CEO, mentioned he expects the deal will ship an “instant uplift” to the entire firm’s shareholders.     

“We’ve got been exploring completely different financing choices for the development and growth of the Josemaria venture and we imagine that is the perfect alternative to develop the venture with out direct dilution or financing danger for Josemaria shareholders,” he mentioned in a press launch.   

In response to a question in regards to the dangers of constructing such an enormous funding in Argentina, Rockandel mentioned that it was the “excellent time” to spend money on the nation, earlier than the panorama turned “aggressive.”    

“In case you are looking for a world class ore physique, you need to step out in areas unexplored,” Rockandel mentioned.” I suppose Argentina is a spot that’s going to begin to see much more mining funding as we transfer ahead.”    

On December 16, Argentina’s Chubut province authorized a legislative invoice that changed a 19-year-old regulation in opposition to open pit mining. The transfer was met with protests by environmentalists within the province’s capital.   

(This text first appeared in The Northern Miner)

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