May 17, 2020

Tax Issues Halt Sale of Freeport-McMoRan's Candelaria Copper Mine in Chile

Freeport-McMoRan Copper & Gold
2 min
Tax Issues Halt Sale of Freeport-McMoRan's Candelaria Copper Mine in Chile
The sale ofFreeport-McMoRan Copper & Gold(NYSE:FCX)s Candelaria copper mine in Chile has been sidetracked as major changes to the South American cou...

The sale of Freeport-McMoRan Copper & Gold (NYSE:FCX)’s Candelaria copper mine in Chile has been sidetracked as major changes to the South American country’s tax regime take effect.

The US based company, which is currently in negotiations to sell the mine to Canadian miner Lundin Mining (TSE:LUN) for $2 billion, is awaiting clarity on Chile’s new tax reform before the sale can be completed.

According to the Wall Street Journal, Chile’s tax reform, which was approved by the Senate in July, was sent back to the country’s lower house of congress for approval. The legislation is required before the sale can be approved.

Freeport McMoRan, which has a working partnership with Lundin for the Tenke Fungurume copper mine in the Democratic Republic of the Congo, has been working to diversify into the oil and gas market to alleviate its $20.90 billion debt. The mining giant announced in May a deal to sell its Eagle Ford Shale assets for $3.1 billion.

"This might not be the best time to sell a copper asset but they promised to reduce their debt," says Charles Bradford, an analyst with Bradford Research Inc.

"And Candelaria's a good property that can generate some cash, and there are people out right now with money to spend."

Candelaria – a joint venture between Freeport-McMoRan (80 percent) and Japanese trading company Sumitomo Corp. (20 percent) is company’s fifth biggest mine overall by number of employees and second largest in Chile.

The mine, which consists of an open-pit copper mine and underground copper mine, produced 370 million pounds of copper and 87,000 ounces of gold last year.

The US miner operates four copper mines in South America – Cerro Verde in Peru, the El Abra, Ojos del Salado and Candelaria in Chile.

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Jun 29, 2021

Vale invests $150mn to extend life of Manitoba operations

battery metals
2 min
Vale’s $150mn investment in operations at Thompson, Manitoba will extend mine life by 10 years

Vale has announced a $150mn CAD investment to extend current mining activities in Thompson, Manitoba by 10 years while aggressive exploration drilling of known orebodies holds the promise of mining well past 2040.

Global energy transition is boosting the market for nickel

The Thompson Mine Expansion is a two-phase project. The announcement represents Phase 1 and includes critical infrastructure such as new ventilation raises and fans, increased backfill capacity and additional power distribution. The changes are forecast to improve current production by 30%.

“This is the largest single investment we have made in our Thompson operations in the past two decades,” said Mark Travers, Executive Vice-President for Base Metals with Vale. “It is significant news for our employees, for the Thompson community and for the Province of Manitoba.

“The global movement to electric vehicles, renewable energies and carbon reduction has shone a welcome spotlight on nickel – positioning the metal we mine as a key contributor to a greener future and boosting world demand. We are proud that Thompson can be part of that future and part of the low carbon solution.”

Vale continues drilling program at Manitoba

Coupled with today’s announcement, Vale is continuing an extensive drilling program to further define known orebodies and search for new mineralization.

“This $150mn investment is just one part of our ambitious Thompson turnaround story. It is an indicator of our confidence in a long future for the Thompson operations,” added Dino Otranto, Chief Operating Officer for Vale’s North Atlantic Base Metals operations.

“Active collaboration between our design team, technical services, USW Local 6166, and our entire Thompson workforce has delivered a safe, efficient and fit-for-purpose plan that will enable us to extract the Thompson nickel resources for many years to come.”

The Thompson orebody was first discovered in 1956 by Vale (then known as Inco) following the adoption of new exploration technology and the largest exploration program to-date in the company’s history.  Mining of the Thompson orebody began in 1961.

“We see the lighting of a path forward to a sustainable and prosperous future for Vale Base Metals in Manitoba,” said Gary Annett, General Manager of Vale’s Manitoba Operations.

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