Canadian authorities have approved the deal between Pan American Silver and a subsidiary of Chinese Zijin Mining Group to sell La Arena mine in Peru.
Since Pan American is a Vancouver-based company, it falls under the terms of the Investment Canada Act. Earlier, Rough&Polished reported that Canadian authorities plan to implement stringent measures governing foreign capital in the critical minerals mining sector to protect its national interests in the face of global competition from such countries as China.
The government said that transactions involving important Canadian mining companies engaged in significant critical minerals would be subject to "net benefit" reviews under the Investment Canada Act. Canada had forced three Chinese investors to sell their stakes in Canadian critical mineral companies in 2022. Some of these companies did not have their mines in Canada.
The deal would involve Pan American entering into an offtake agreement to secure 60% of the future copper concentrate supply from the La Arena project on commercial terms for sale in North American markets, following the commencement of commercial production.
Having obtained all the necessary regulatory approvals, the company said the transaction is expected to close by the end of 2024. Once commercial production from the La Arena project starts, the agreement provides for an additional contingent payment from Zijin of $50 million in cash.
Theodor Lisovoy, Managing Editor, Rough&Polished
