Lundin Mining Corporation has successfully completed the acquisition of an additional 19 per cent interest in the Caserones copper-molybdenum mine in Chile, increasing its ownership to 70 per cent.
The transaction, which closed on July 2, 2024, was executed through the purchase of equity in SCM Minera Lumina Copper Chile, the mine’s operating company.
The Canadian-based mining company paid $350 million in cash to JX Advanced Metals Corporation for the additional stake.
This move follows Lundin Mining’s initial acquisition of a 51 per cent interest in Caserones in March 2023, demonstrating the company’s commitment to expanding its copper production profile.
Jack Lundin, President and CEO of Lundin Mining, commented on the strategic importance of the transaction: “We are pleased to expand our ownership in a long-life operation characterised by robust cash flow generation, further enhancing Lundin Mining’s presence in the region and strengthening our overall copper-dominant portfolio of high-quality base metal mines.”
The deal is expected to have immediate financial benefits for Lundin Mining. Upon closing, Lumina Copper declared a cash dividend of $150 million, of which Lundin Mining will receive 70 per cent, or $105 million.
This distribution aligns with the amended shareholders’ agreement, which grants Lundin Mining rights to 70 per cent of distributions retroactively from January 1, 2024.
The Caserones mine is a significant asset in Chile’s copper industry. For 2024, the mine is projected to produce between 120,000 and 130,000 tonnes of copper and 2,500 to 3,000 tonnes of molybdenum on a 100 per cent basis.
The cash cost for copper production is estimated at $2.60 to $2.80 per pound, factoring in byproduct credits and assuming an average molybdenum price of $20 per pound.
This acquisition solidifies Lundin Mining’s position as a major player in the global copper market and underscores the company’s strategy of disciplined growth in the copper sector.
The transaction also highlights the ongoing consolidation and strategic positioning within the mining industry, particularly in Chile, a key copper-producing region.
