Lundin Mining closes acquisition of Josemaria Resources
Published by Jessica Casey,
Global Mining Review,
Lundin Mining Corp. has completed the previously announced plan of arrangement (the arrangement) to acquire all of the issued and outstanding shares of Josemaria Resources Inc.
“The addition of the Josemaria Project to Lundin Mining’s portfolio solidifies our position as a leading base metals producer with high-quality copper exposure and significant growth. We look forward to building upon the excellent reputation of Josemaria Resources in San Juan and Argentina,” said Peter Rockandel, Lundin Mining President and CEO. “We are excited to lead the project through the remaining stages of development and into production to create significant value for all stakeholders.”
Under the terms of the arrangement, Josemaria Resources shareholders were provided the right to elect to receive 0.1487 of a common share of Lundin Mining per Josemaria Resources common share, plus CAN$0.11 for each whole Lundin Mining share issued to such shareholder or CAN$1.60 in cash for each Josemaria share or any combination thereof, subject to pro-ration of a total maximum cash consideration of approximately CAN$184.5 million and a total maximum of approximately 40 million Lundin Mining shares.
Josemaria Resources shares will be delisted from the TSX Exchange and Nasdaq Stockholm. An application will also be made for Josemaria Resources to cease to be a reporting issuer in the applicable jurisdictions.
Josemaria Project update
As announced by Josemaria Resources on 11 April 2022, the Mining Authority of San Juan, Argentina, has approved the environmental social impact assessment for the Josemaria Project, marking a significant milestone in the project’s permitting process. Lundin Mining and the Josemaria Project team are working with the national and provincial authorities to progress the project through the next stages of development. Discussions regarding commercial agreements and securing of additional sectoral permits are ongoing and anticipated later this year prior to a definitive construction decision.
The Josemaria Project is progressing through basic engineering with procurement of long-lead equipment, including securing key items of crushing and processing. Study work is ongoing, including updating of cost estimates to be reflective of current conditions and evaluation of potential scope changes compared to plans envisaged in the Josemaria Resources 2020 feasibility study. Lundin Mining aims to complete an updated technical report for the project in 4Q22. While this work has not yet concluded, the company expects the initial capital expenditure estimate of the project to be greater than CAN$4 billion. Effective post-closing, the company intends to spend up to CAN$300 million to advance the project ahead of a construction decision in 2H22, including engineering, commitments for long lead items, preconstruction activities and drilling.
As part of the updated technical report, Lundin Mining plans to complete new mineral reserve and resource estimates. Approximately 20 600 m of drilling have been completed on the project since the most recent 2020 Josemaria Resources mineral estimates and 35 000 m of additional drilling are planned to be completed ahead of the new estimates.
Read the article online at: https://www.globalminingreview.com/finance-business/06052022/lundin-mining-closes-acquisition-of-josemaria-resources/
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