Lundin Mining (TSX: LUN) of Canada is purchasing a controlling stake in Chile’s Caserones copper-molybdenum mine for approximately 950 million dollar, adding to a flurry of trades as miners seek to extend their exposure to the commodity critical to the globe’s energy revolution.
The owner of Caserones, Japan’s JX Nippon Mining & Metals Corp., will sell a 51 percent interest in the mining operation to the buyer.
Lundin stated it will pay 800 million dollar up front in cash and an additional 150 million dollar over the course of 6 years following the close of the purchase.
In addition, the deal provides the Toronto-based miner the option to spend 350 million dollar over 5 years to acquire a further interest in the copper-molybdenum mine, up to a maximum of 19 percent.
Our exposure to what we consider to be a developing top-tier copper mining region is increase by the initial controlling position. According to Lundin’s CEO Peter Rockandel. “We still have the possibility to raise our stake over the coming years at a competitive price.
An examination of the company’s asset portfolio. According to JX Nippon Mining & Metals, led to the decision to sell a portion of Lumina Copper, a subsidiary that runs Caserones.
In Nov 2020, the company bought the holdings from its business partners Mitsui & Co & Smelting & Mitsui Mining, becoming the mine’s majority owner.
Since May 2014, there have been many ramp-up delays & price overruns. The mine’s output, which is currently around 100K tonnes annually, is still less than the 150K tonnes a year that were once planned.
According to Lundin. The purchase should be completed by June 2023. Caserones is a town in Chile’s Atacama desert, closer to the Argentine border, at an elevation of 4,200 to 4,600 metres above sea level.