Both parties have also signed an offtake contract for 81% of the copper cathode produced at the project during the initial years of production
Mitsui, Taseko sign offtake contract for 81% of copper cathode produced at the Florence copper project. (Credit: MITSUI & CO., LTD.)
Taseko Mines has signed agreements with Mitsui to form a partnership to develop its Florence copper project in Arizona, US.
As a part of the partnership, Mitsui will make an initial investment of $50m in the form of a copper stream agreement on 2.67% of the copper produced at the project.
The proceeds from the investment are expected to be used for the construction of the commercial production facility.
Besides, both parties have signed an offtake contract for 81% of the copper cathode produced at the Florence copper project during the initial years of production.
Furthermore, Mitsui has the option to invest an additional $50m for a 10% stake in the copper project.
Mitsui is eligible to exercise the equity option within three years after the completion of constructing the commercial production plant.
The copper stream will be terminated if Mitsui chooses to exercise its equity option, stated Taseko Mines.
Mitsui & Co. (U.S.A.) president and CEO Sayu Ueno said: “We are excited to partner with Taseko and its unique, low-carbon and low-impact Florence Copper project.
“When in production, Florence Copper will significantly expand our US cathode trading business, while providing an environmentally sound, domestically produced product that can be marketed on the basis of its low-carbon advantages.
“We believe Florence Copper will be a preferred source of ‘made-in-the-US’ copper for many end users in North America.”
The Florence copper project is expected to use in-situ recovery (ISR) to produce copper by extracting the metal from underground deposits.
The construction of the copper project is anticipated to begin once it receives the US Environmental Protection Agency’s final environmental permit, which is expected to take 18 months.
Following the completion of the construction, production is expected to commence at the Florence copper project.
Taseko Mines president and CEO Stuart McDonald said: “This agreement with Mitsui establishes a strategic partnership with a leading international company. Mitsui’s investment will complement Taseko’s financing requirements and construction timeline and advance our goal of ensuring the copper produced at Florence is recognised for its unique low-carbon profile that will advantage US manufacturers and consumers.
“In the future, Taseko and Mitsui will collectively evaluate additional investments toward establishing Florence Copper as a zero-carbon copper producer (Scope 1 and 2).”