Codelco announced on Thursday that it has bought Enami’s 10% stake in Teck’s (TSX: TECK.A, TECK.B; NYSE: TECK) Quebrada Blanca mine in northern Chile for $520 million.
According to the Chilean state-run miner, the deal will contribute 25,000 to 30,000 tonnes of copper to Codelco’s annual output.
Codelco said it will maintain the share rights previously held by Enami, which is also a state-run mining company. These rights include preferential dividends, protection from dilution in future capital increases, and the ability to appoint two of the eleven board members.
“Our strategy of developing and strengthening the company through partnerships will enhance our position in the copper and lithium markets and, in turn, increase the value that Codelco contributes to the country. In this same line, it is very positive that an asset of this value remains in the hands of the state,” Codelco chairman Máximo Pacheco said in a news release.
Enami valued its stake in the mine at $323.8 million last year. In a statement regarding the sale to Codelco, it said the deal will help reduce Enami’s debt from $740 million to $250 million.
Quebrada Blanca is located in northern Chile at an elevation of 4,400 metres, about 240 km southeast of the city of Iquique and 1,500 km from the capital, Santiago.
It began production in 1994 as an open pit copper operation with Teck, Canada’s largest diversified miner and current majority owner, entering in 2007.
Quebrada Blanca has a resource base of 10 billion tonnes at a grade of 0.38% copper.
Once second phase is fully operational, the mine will rank among the 20 highest copper-producing operations in the world and will be the sixth-largest producer in Chile, following Escondida, Collahuasi, El Teniente, Radomiro Tomic and Los Pelambres, based on 2023 production levels.
