TOKYO, July 27, 2018 - (JCN Newswire) - Mitsubishi Corporation (MC) is pleased to announce that it has reached a final investment decision with Anglo American plc (AA) for the development of the Quellaveco copper mine project in Peru (Quellaveco).
Quellaveco is being developed by Anglo American Quellaveco S.A. (AAQSA), a joint venture owned by MC and AA. MC has agreed with AA to acquire an additional 21.9% equity interest in AAQSA, thereby increasing the proportion of its total interest in AAQSA to 40%(1).
Development of the project will commence once the transaction closes in August 2018, with the start of copper production slated for 2022. Development is expected to carry a capital cost of US$5.0 to 5.3 billion and MC will fund its equity pro-rata portion of 40%.
Given its current level of involvement in world-class copper mining assets that have high resource volumes and quality as well as potential for expansion, copper constitutes one of the core areas of MC's resources business. Quellaveco, one of the world's largest undeveloped copper deposits, contains approximately 7.5 million tonnes (content metal basis) of copper in Ore Reserves and is highly cost competitive.
This transaction is expected to increase MC's attributable copper production by approximately 120 thousand tonnes per year, which is equivalent to 50% of MC's existing attributable copper production, and will contribute to strengthening the company's copper investment portfolio.
Growth in global copper demand is expected to remain steady, fueled by the development of power networks and other infrastructure in emerging countries and by growth in the global electric vehicle market centered around China and Europe. Through the successful development of Quellaveco, MC aims to continue providing a stable supply of copper over the long-term and in keeping with the needs of society. MC remains committed to fulfilling the expectations of its stakeholders and the pursuit of sustainable growth while at the same simultaneously generating economic, social, and environmental value.
(1) MC will acquire an additional 21.9% equity interest for a consideration of US$500 million. An additional contingent consideration shall be made upon the successful achievement of two ore treatment expansions, for a total of US$100 million. MC will increase its total interest in AAQSA to 40% by way of a primary share subscription. Please refer to our press release dated on June 15, 2018 for further detail.
About Mitsubishi Corporation
Mitsubishi Corporation, headquartered in Tokyo, is a global integrated business enterprise that develops and operates business across virtually every industry including industrial finance, energy, metals, machinery, chemicals, foods, and environmental business. Mitsubishi Corporation's current activities are expanding far beyond its traditional trading operations as its diverse business ranges from natural resources development to investment in retail business, infrastructure, financial products and manufacturing of industrial goods. For more information on Mitsubishi Corporation, please visit the company's website at https://www.mitsubishicorp.com/jp/en/.
Telephone: +81 3 3210 2171
Facsimile: +81 3 5252 7705
July 27, 2018 10:50 HKT/SGT
Source: Mitsubishi Corporation
Mitsubishi Corporation (TSE: 8058)
Topic: Press release summary
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