Analysts said that Antofagasta’s $1 billion purchase was based on a higher copper price or operational improvements at the open-pit mine, which produced 100,000 tonnes of copper past year.
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Antofagasta – which may be your owner of one’s Zaldivar copper mineral mine – will spend a full of $1 dollar, 005m in hard cash being made of US$980m with finishing, theme to traditional treatments, and five annually installments of US$5m each year, initiating in 2016.
Toronto-based Barrick also said it was “actively exploring” a number of other joint venture and sales opportunities.
“Antofagasta will help to realize that potential by leveraging its deep operating expertise in Chile, including potential synergies with its existing portfolio”.
Barrick and Antofagasta will create a board to oversee Zaldivar, with each company contributing three directors.
Antofagasta “will act as the operator of the mine” and appoint the first chairman of Zaldivar’s board, although the right to appoint the chairman will rotate between the two partners on an annual basis.
The deal is expected to be completed in late 2015. Kelvin Dushnisky, Co-President of Barrick, commented: “We are pleased to reach an agreement with the ideal partner for Zaldivar”.
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Both companies said the agreement was a first step in a partnership. Barrick has said it wants to reduce its debt by at least $3 billion this year.
