Ecora Resources has signed a $50 million copper stream agreement with Moxico Resources for the Mimbula mine in Zambia. The deal aims to strengthen Ecora’s copper portfolio and financial performance. Deliveries will occur quarterly, and payments will be based on market prices. The agreement is expected to enhance liquidity and support expansion plans at the Mimbula mine, which has projected increased production capability in coming years.
Ecora Resources, a company specializing in critical minerals, has finalized a $50 million copper stream agreement with Moxico Resources for the Mimbula copper mine located in Zambia. This strategic partnership aims to bolster Ecora’s copper growth profile, ensuring a steady revenue stream in both the near and distant future.
The stream arrangement encompasses Moxico’s existing 11-year mine life based on reserves, with potential for extension. After acquiring 9,150 tonnes of copper, estimated to occur in seven to eight years, Ecora’s entitlement will decline to 1% of the copper cathodes produced throughout the mine’s remaining operational period.
Copper deliveries under this agreement will be made quarterly, with Moxico receiving continuous payments equivalent to 30% of the quarterly average copper price on the London Metal Exchange for all copper supplied. This structure mitigates ramp-up risks and is projected to yield returns within six to seven years.
To finance this transaction, Ecora has invoked $30 million from its $75 million revolving credit facility, thus increasing its total borrowing capacity to $180 million, with approximately $55 million still accessible. Ecora’s CEO Marc Bishop Lafleche expressed enthusiasm over this partnership and highlighted Mimbula’s attributes, including its high-quality ore body with low operating costs and a seasoned management team.
Located in Zambia’s Copperbelt Province, the Mimbula mine commenced copper production in late 2022. Writing a high-margin operation, it produced 14,000 tonnes of copper in 2024 while maintaining operating costs in the lowest global tier. A phase two expansion project aims to elevate annual production capacity to around 56,000 tonnes by mid-2026.
The funds generated from this streaming agreement will bolster liquidity for Mimbula’s expansion endeavors as well as cater to other corporate requirements. The completion of this transaction is anticipated in the near future and marks a significant milestone for all parties involved.
In summary, Ecora Resources has secured a pivotal $50 million copper stream agreement with Moxico Resources for the Mimbula copper mine in Zambia. This collaboration not only positions Ecora favorably within the copper market but also ensures liquidity for future expansion. The anticipated growth at the Mimbula mine highlights the potential of this strategic investment, promising immediate benefits to cash flow and earnings. With the execution of this agreement and planned expansion, both Ecora and Moxico are set to enhance their operational capabilities in a leading copper-producing region.
Original Source: www.mining-technology.com
