Ecora Resources has signed a $50 million streaming deal for Moxico’s Mimbula copper mine in Zambia, enhancing its copper assets. The deal covers the mine’s full operational life and strengthens Ecora’s market position. With ongoing expansions, Mimbula aims to boost copper production significantly, contributing to Ecora’s earnings and growth.
Ecora Resources, a critical minerals royalty company, has recently finalized a $50 million streaming deal with Moxico Resources for their Mimbula copper mine located in Zambia. This all-cash agreement spans the mine’s entire 11-year operational life based on current reserves, with a possibility for future extensions. Ecora’s CEO, Marc Bishop Lafleche, expressed that this acquisition strengthens Ecora’s commitments to copper while benefiting earnings and free cash flow.
The Mimbula project, situated 10 kilometers southeast of Chingola in the Zambian Copperbelt Province, began production in late 2022 and is currently in Phase 1, producing high-purity copper cathodes (99.999%). The operation utilizes a heap leaching and solvent extraction/electrowinning (SX/EW) process, targeting an annual production capacity of 10,000 tonnes. Plans for a Phase 2 expansion are in progress, aiming to increase capacity to 56,000 tonnes per annum.
Lafleche highlighted that the Mimbula investment meets Ecora’s strategic criteria due to its high-quality ore, low operating costs, and strong management team. The first phase of the Phase 2 expansion was completed and operational in early 2024, boosting cathode output to 20,000 tonnes per annum. Moxico, which controls a 93% stake in Mimbula, anticipates concluding the expansion by early next year, reaching full capacity by mid-2026.
Further expansion plans include the potential Phase 3 to construct a processing plant for cobalt extraction, as Mimbula currently holds a resource of 38.6 million tonnes with a cobalt grade of 0.037%. Lafleche stated that this acquisition will significantly elevate Ecora’s copper growth trajectory both in the short and long term.
Following the completion of this transaction, it is expected that copper and base metal exposure could reach approximately 45% and 75% of Ecora’s net asset value (NAV), respectively. Other copper assets in Ecora’s portfolio comprise the Mantos Blancos mine in Chile and the Carlota mine in Arizona owned by KGHM.
To facilitate this deal, Ecora plans to utilize a combination of reserves and debt, including $30 million through their revolving credit facility. Lafleche noted that the transaction aims to frontload copper entitlements in the initial years, fostering a growth in earnings while also assisting in expected debt reduction over the next one to two years.
Ecora Resources has successfully secured a $50 million streaming deal for the Mimbula copper mine in Zambia, enhancing its copper-focused portfolio and driving potential earnings growth. The project, which will significantly increase production capacity, aligns with Ecora’s strategic objectives to solidify its position in the critical minerals market. The planned expansions and existing projects within the company are poised to enhance its financial stability and growth.
Original Source: www.mining.com
