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Copper|Gold|Mining|PROJECT
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Canada approves Pan American’s Peru asset sale to Zijin

The La Arena mine in Peru

The La Arena mine in Peru

6th November 2024

By: Creamer Media Reporter

     

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The government of Canada has approved Pan American Silver’s sale of its La Arena mine and project in Peru to a subsidiary of China’s Zijin Mining Group.

The approval, which was granted under the Investment Canada Act, is subject to a joint undertaking from Pan American and Zijin to enter into an offtake agreement in respect of the La Arena II project, which will enable Pan American to secure 60% of the future copper concentrate supply from the La Arena II project on commercial terms for sale in North American markets, following the commencement of commercial production.

The transaction now has all the necessary regulatory approvals and is expected to close by the end of the fourth quarter of 2024.

Under the terms of the agreement for the La Arena sale, upon closing, Zijin will pay $245-million in cash and grant to Pan American a life-of-mine gold net smelter return royalty of 1.5% for the La Arena II project.

Once commercial production from the La Arena II project starts, the agreement provides for an additional contingent payment from Zijin of $50-million in cash.

Pan American Silver produces silver and gold in the Americas, operating mines in Canada, Mexico, Peru, Brazil, Bolivia, Chile and Argentina. It also owns the Escobal mine in Guatemala that is currently not operating.

Edited by Creamer Media Reporter

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