Antofagasta gets $1bn financing for Esperanza

18th May 2009 07:39

Miner Antofagasta has arranged a $1.05bn, 12-year financing facility for its Esperanza copper-gold project in Chile.Definitive agreements were signed by Minera Esperanza in which Antofagasta has a 70% stake. Marubeni Corporation owns the rest. Lenders include Japan Bank for International Cooperation and a consortium of banks, which are putting up $400m each. Export Development Canada has agreed $200m and KfW IPEX-Bank $50m.The company expects to get its hands on the first of the cash in the middle of 2009.The balance of the project's $2.3bn total estimated capital cost, from the start of construction in the third quarter of last year, is being funded by Antofagasta and Marubeni pro-rata to their ownership interests. Esperanza, close to Antofagasta's El Tesoro mine, has a 16-year mine life based on proven and probable ore reserves of 583 million tonnes of copper, 0.223 g/tonnes gold and 0.010% molybdenum.Initial production of the commercial concentrate is due at the end of 2010, with about 714,000 tonnes of concentrates containing 191,000 tonnes of payable copper, 215,000 ounces of payable gold and 1,132,000 ounces of payable silver expected in the first ten years of operations.Including Esperanza, Marcelo Awad, head of Antofagasta's mining division, predicts Antofagasta's total copper production should reach nearly 700,000 tonnes per annum in 2011.