Glencore International AG and Pan American Silver Corp have reached an agreement for Glencore to acquire the 56.25% stake in the MARA project from Pan American. Under the terms of the agreement, Glencore will pay $475 million in cash upon closing and grant Pan American a copper Net Smelter Return (NSR) royalty of 0.75%.
The project was first formed through the integration of the Minera Alumbrera plant and mining infrastructure and Agua Rica project in a joint venture between Yamana Gold, Glencore and Newmont in December 2020. Glencore acquired Newmont’s 18.75% stake in October 2022, bringing its shareholding to 43.75%. Pan American acquired Yamana Gold’s 56.25% stake as part of its acquisition of Yamana Gold Inc in March 2023.
MARA, located in the Catamarca province of Argentina, has proven and probable mineral reserves of 5.4 Mt of copper and 7.4 Moz of gold contained in 1.105 billion tonnes of ore. It has a 27-year mine life based on mineral reserves supported by more than 86 km of drilling.
The brownfield MARA project ranks as one of the lowest capital-intensive copper projects in the world today, owing to the existing well maintained Alumbrera processing plant and associated infrastructure. MARA is expected to be in the top 25 global copper producers when operational, with an expected average copper production over the first 10 full years exceeding 200,000 t per annum (with further material by-product credits).
Glencore says it has extensive institutional knowledge of the asset and the jurisdiction, based on its successful history of running the Alumbrera operations prior to the integration with Agua Rica in 2020. The closing of the transaction is subject to customary conditions and regulatory filings. Glencore expects the transaction to be completed in Q3 2023. Upon completion of the transaction, Glencore will become the sole owner and operator of MARA.
Glencore’s other main copper play in Argentina is El Pachon, currently undergoing a full feasibility study. It is a copper and molybdenum project located in the province of San Juan, in Argentina. Located between 3,600 and 4,200 m above sea level, it is approximately 5 km from the international border with Chile. El Pachon is 100% owned and is expected to have a 25-year mine life, producing about 350,000 t of copper per annum.