First Quantum Minerals has agreed to acquire LS-Nikko Copper’s 10% ownership interest and shareholder loans in Minera Panama (MPSA) project for around $635m.
Minera Panama has concession for the Cobre Panama project, which is an open-pit copper development project in Panama.
The acquired stake will allow Quantum Minerals to increase its ownership interest to 90% in the project. The company will pay the amount in six installments over a five-year period.
Cobre Panama project is situated around 120km west of Panama City and 20km from the Caribbean Sea coast in the district of Donoso, Colon province.
The concession is comprised of four zones with around 13,600 hectares.
First Quantum will purchase LS-Nikko Copper's 50% stake in Korea Panama Mining (KPMC), which is a 50/50 joint venture (JV) firm with Korea Resources (KORES) that holds 20% interest in MPSA.
The deal, which is subject to the approval of the board of directors of KORES, is expected to be completed by the end of this month.
First Quantum Minerals chairman Philip Pascall said: "This acquisition underlines our confidence in this world class project and the strong fundamentals for copper.
“The Cobre Panama project is now over 60% complete and progressing well towards its commissioning next year, and on track to be one of the major, low-cost copper producers when in operation.
“We are very pleased that this compelling opportunity became available and that we have been able to reach agreement with LS-Nikko Copper on terms that match the development and commissioning timetable for Cobre Panama."