Ecora Resources Enters $50 Million Copper Stream Agreement for Mimbula Mine
Ecora Resources has signed a $50 million copper stream agreement with Moxico Resources for the Mimbula copper mine in Zambia. The deal aligns with Ecora’s strategy to expand its copper portfolio while ensuring short- and long-term earnings growth. Copper deliveries and payments will be structured to mitigate risks, with repayment forecasted within six to seven years. An expansion at Mimbula is also underway, aiming to boost production significantly.
Ecora Resources, a company focused on critical minerals, has announced a $50 million copper stream agreement with Moxico Resources pertaining to the Mimbula copper mine in Zambia. This agreement is part of Ecora’s broader strategy to boost its copper growth profile and enhance earnings over the coming years.
The agreement encompasses the existing reserve-based life of mine (LOM) of 11 years for the Mimbula mine, with potential for extension. Ecora’s entitlement will adjust after accumulating 9,150 tonnes of copper, transitioning to a 1% share of copper cathode production for the mine’s operational duration.
Copper deliveries to Ecora will occur quarterly, with payments to Moxico set at 30% of the average quarterly copper price on the London Metal Exchange. This structure aims to mitigate ramp-up risks, and the investment is projected to repay within six to seven years.
To finance this transaction, Ecora has drawn $30 million from its $75 million revolving credit facility, increasing its total borrowing capacity to $180 million, leaving around $55 million available post-transaction.
Marc Bishop Lafleche, CEO of Ecora, expressed enthusiasm for the partnership stating, “We are excited to start 2025 with the announcement of a new partnership with Moxico in relation to the Mimbula copper mine, which will cement copper at the core of our commodity exposure and be immediately accretive to earnings and free cash flow.”
The Mimbula mine, situated in Zambia’s Copperbelt Province, commenced copper production in late 2022. It is known for its high margins and low operating costs, producing Grade A London Metal Exchange cathodes. In 2024, it achieved a production output of 14,000 tonnes of copper with competitive operating costs.
Currently, a phase two expansion is underway, which aims to boost annual copper cathode production to approximately 56,000 tonnes by mid-2026. The funds generated from the stream will not only support the expansion of Mimbula but also cater to other corporate needs. The completion of this transaction is expected imminently.
In related activities, Atlantic Metals, a subsidiary of Moxico Resources, has secured an agreement with Latin Metals for a 75% interest in two copper exploration projects in Argentina, as announced in October 2024.
Ecora Resources has strategically entered into a $50 million copper stream agreement with Moxico Resources to enhance its presence in the copper mining sector. This partnership is anticipated to yield immediate financial benefits, tapping into the productive capacity of the Mimbula copper mine. The transaction reflects Ecora’s commitment to expanding its commodity exposure while supporting Mimbula’s future growth and operational efficiency.
Original Source: www.mining-technology.com
