Chile’s state mining company Codelco has purchased a 10% stake in Quebrada Blanca mine from fellow state firm Enami for $520 million.
The project is located in northern Chile and is operated by Teck Resources. According to Bloomberg, the deal will contribute 25,000 to 30 000 tons of copper to Codelco's annual output, and entitle the state miner to preferential dividends, protection from share dilution in future capital increases and the ability to appoint two of 11 board members.
The deal comes as Codelco, the world's top copper miner, is struggling to boost declining production levels. The sale would also help reduce Enami’s debt after years of losses from processing mineral for small miners in Chile, while minimizing the amount of fresh capital needed from public funds.
Quebrada Blanca last year inaugurated an expansion which cost $8 billion, allowing it to produce 320 000 tons of copper annually during the first five years of operation.
Codelco Chairman Maximo Pacheco in a statement said the deal highlights the company's efforts to ensure "enhanced access to large-scale assets, reduced risk and diversified opportunities."
Theodor Lisovoy, Managing Editor, Rough&Polished
