Canada’s Ivanhoe Mines (TSX: IVN) has inked deals with China’s Zijin Mining’s subsidiary and trader Citic Metal to sell each 50% of the copper production from the recently-launched first phase of its Kamoa-Kakula mine in the Democratic Republic of Congo (DRC).
The copper concentrate and blister copper off-take agreements will see wholly-owned Zijin unit Gold Mountains (H.K.) International Mining Co Ltd and Citic Metal split the initial offtake from Kakula, Ivanhoe’s first of the two mines at the concession.
The mining firm affirmed that it will hold its end of the bargain, having been given full authorization from DRC government to export blister copper and concentrate to international markets. The permit came as Ivanhoe inked a 10-year agreement with the Lualaba Copper Smelter, located outside the town of Kolwezi, for the processing of a portion of Kamoa’s copper concentrate production.
First copper concentrates
The miner delivered its first copper concentrates to Lualaba on June 1, and will receive first blister copper ingots within 30 days of delivery. Citic Metal and the Zijin unit will each provide an advance payment of up to US $150 million, which can be drawn on by Kamoa Copper tomorrow 10th of June until May 31, 2023.
“The facility will bear an annual interest rate of 8% and will be offset against provisional payments due to Kamoa Copper from product deliveries,” said Ivanhoe’s co-chairperson Robert Friedland.
Ivanhoe anticipates Kamoa-Kakula’s first-phase output to be about 200,000 tonnes of copper per year. Operations at Kamoa-Kakula are set to ramp up this year to reach between 80,000 and 95,000 tonnes of copper in concentrate. After several phases of expansion, the mine’s peak annual copper production will be more than 800,000 tonnes.