Mantos Copper has secured a financing package of $847m to fully fund the development of the Mantoverde sulphide project in northern Chile.

The financing package includes project development debt of $571.6m provided by certain banks and export credit agencies. The development debt is made up of a 12-year senior secured amortising project debt facility of $520m, and a 10-year senior secured closure bonding facility of $51.6m.

For the senior secured amortising project debt facility, Mantos Copper has signed definitive documentation with Banco de Crédito e Inversiones, Export Finance Australia, BNP Paribas, MUFG Bank, ING Capital, Natixis, and Societe Generale.

Finnish export credit agency Finnvera has given a raw material guarantee for the project, that covers $250m of the senior debt. The guarantee is linked to a 10-year offtake agreement for 75,000 tonnes per annum (tpa) of copper concentrate with Boliden Commercial.

Last year, around this time, Mantos Copper signed a deal worth $275m with Japan-based Mitsubishi Materials (MMC) to divest a 30% stake in the Mantoverde sulphide project. The deal, which was subject to arrangement of the project financing and other closing conditions, has now been closed.

Mitsubishi Materials will also provide a cost overrun facility of $60m for buying an additional quantity of copper concentrate from the open pit mine. The Japanese firm expects to be entitled to nearly 42% of the total copper concentrate produced from the Mantoverde sulphide project.

Mantos Copper said that with all the preceding conditions to financial close being satisfied, the company has commenced the construction. Under a turnkey EPC contract, Australian engineering company Ausenco will carry out the construction on the $783.6m Mantoverde sulphide project.

Mantos Copper executive chairman John MacKenzie said: “The project will expand Mantoverde into a world class copper mine, and bring material benefit to all of its stakeholders, including employees, contractors, suppliers, customers and local communities.

“Together with our fully financed Mantos Blancos Concentrator Debottlenecking Project, the construction of which is now 70% complete and which will extend Mantos Blancos’ life to 2035 by increasing and streamlining production from its sulphide deposit that features an average grade of 0.85% in the next ten years, Mantos Copper is well advanced in realising our strategy in becoming a world class sustainable copper business with total copper production approaching 200 kt per annum.”

The brownfield copper project calls for the construction of a copper concentrator, a tailings dam, and other related facilities to process ore from the Mantoverde sulphide deposit.

It will extend the life of the Mantoverde mine to at least 2041. After its completion, Mantoverde will produce 110,000 tonnes of copper and 33,000 ounces of gold per year, on an average, from 2023 to 2030.

Located in the Atacama region, Mantoverde copper mine is estimated to have 2.1 million tonnes (Mt) of copper reserves and 5.7Mt of copper resources.