Mitsubishi acquires 30% of Mantoverde copper mine

Japanese powerhouse Mitsubishi Materials Corporation (MMC) has acquired a 30% stake in Mantos Copper’s Mantoverde mine and associated projects in Chile for US$263 million.

MMC has been seeking to participate in high-quality copper projects to secure concentrate for its copper smelters, as demand for the industrial metal is expected to soar in the coming years because of its use in electric vehicles (EVs) and renewable technologies.

Mantos Copper, owned by a consortium led by British investment company Audley Capital Advisors and Orion Mine Finance Group, acquired the Mantoverde and Mantos Blancos mines from Anglo American (LSE: AAL) in 2015.

The Mantoverde open-pit mine, in the arid Atacama Desert, holds an estimated 2.1 million tonnes of copper reserves. Mantos Copper has unveiled plans to build a concentrator and expand facilities, something that may now come faster than expected with Mitsubishi’s involvement.

Last year, the company secured US$250 million to fund the expansion of the sulphides concentrator at its Mantos Blancos operation, which will extend the life of the open-pit mine until 2035 and reduce costs.

The figure included a US$150 million-loan from Glencore’s subsidiary Altonorte. Another $50 million will come from a copper royalty agreement with Anglo Pacific (TSX: APY; LSE: APY).

In the past four years, Japanese trading companies have been grabbing assets and increasing stakes on a few of them thanks to higher commodities prices, which have boosted their profits.

In 2018, Mitsui & Co. increased its interest in Chile’s Collahuasi copper mine to 11.03%. A few weeks later, Mitsubishi Corp. upped its interest in Anglo American’s Quellaveco copper project in Peru by 21.9% for US$600 million, taking its holding to 40%.

Sumitomo followed suit, buying a 30% interest in Teck Resources’ (TSX: TECK.A, TECK.B; NYSE: TCK) Quebrada Blanca Phase 2 project copper project, in northern Chile, for US$1.2 billion.

Chile is the world’s largest copper producer, meeting more than 30% of global demand. The metal accounts for up to 15% of the country’s gross domestic product (GDP).

— This article first appeared in our sister publication, MINING.com.