Lundin Mining to acquire majority interest in Caserones Copper Mine

press release

March 29, 2023

Lundin Mining has entered into a binding purchase agreement with JX Nippon Mining & Metals Corp. and certain of its subsidiaries (collectively, “JX”), to acquire 51 percent of the issued and outstanding equity of SCM Minera Lumina Copper Chile (“Lumina Copper”), a wholly owned subsidiary of JX which operates the Caserones copper-molybdenum mine (“Caserones”) located in Chile.

Lundin Mining is a diversified Canadian base metals mining company with operations and projects in Argentina, Brazil, Chile, Portugal, Sweden and the United States, primarily producing copper, zinc, gold and nickel.

JX will receive upfront cash consideration from Lundin Mining of $800 million, and in addition, $150 million in deferred cash consideration will be payable by Lundin Mining in installments over a six-year period following the closing date.

Lundin Mining will also have the right to acquire up to an additional 19 percent interest in Caserones for $350 million over a five-year period commencing on the first anniversary of the date of closing.

Lundin reports reasons for the purchase include:

• Aligned with strategic goals – delivers a large-scale, long-life copper operation with favorable cash flow generation, complementing Lundin Mining’s existing operations and overall copper-dominant portfolio of high-quality base metal mines.

• Enhances copper production profile – increases exposure to a highly desired base metal and on a pro forma basis would have increased Lundin Mining’s 2022 copper production by 50 percent. This will further solidify Lundin Mining’s position as a meaningful copper producer globally.

• Chile is a well-established Tier-1 mining jurisdiction – Lundin Mining has made a significant investment in the region and the country, and can leverage its operating experience, as well as local regulatory and community relationships.

• Strengthening partnerships – JX has extensive operational knowledge, which will help Lundin Mining to realize the full potential of the Caserones mining operation.

Peter Rockandel, chief executive officer, Lundin said, “Upon closing of the acquisition of Caserones, we add another long-life copper mine of material size and with significant growth potential to our portfolio, in a region in which we have considerable knowledge and experience. The Caserones team has achieved meaningful operational improvements in recent years, and we will work to unlock additional upside through our strong technical resources and existing presence in the region. The initial controlling interest increases our exposure to what we believe is a growing top-tier copper mining district. We retain the option to further increase our ownership over the next few years at an attractive price. The acquisition further solidifies Lundin Mining’s position as a growing global producer of copper as the world shifts to a lower carbon future.”

Caserones is a significant porphyry copper-molybdenum deposit in the Atacama Region (Region III) of the northern Chilean Andean Cordillera, situated between the Maricunga and El Indio belts and is part of the emerging Vicuña copper district. It is located approximately 160 km southeast of Copiapó, 9 km from the border with Argentina, and at an altitude of approximately 4,500 meters above sea level. The operation produces copper and molybdenum concentrates from a traditional open-pit mine and conventional sulphide flotation plant, as well as copper cathode from a dump leach, solvent extraction and electrowinning plant. First copper cathode was produced in 2013, followed by copper and molybdenum concentrates in 2014. Climatic conditions and the physiology of the high-cordillera of the Chilean Andes support mining operations throughout the year.

You can read more about the purchase here

Photo is of the Caserones copper mine and courtesy of Lundin Mining.


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