TOKYO, June 22, 2023 - (JCN Newswire) - Mitsubishi Corporation ("MC") is pleased to announce that it has entered into a share subscription agreement with Marimaca Copper Corp. ("Marimaca" or the "Company"). Marimaca is a publicly-listed Canadian company focused on the development of the Marimaca Copper Project (the "Project") located in Chile. MC will invest CAD20 million by way of a non-brokered private placement to subscribe for an aggregate 4.64 million units in the Company, with each such unit comprised of one common share and one common share purchase warrant at a price of CAD4.31 per unit (the "Strategic Investment"). Upon completion of the Strategic Investment, MC will own approximately 5% of the issued and outstanding common shares of the Company on a non-diluted basis.
The Project is located in the Antofagasta region of northern Chile. Since its discovery in 2016, the Company has continued to conduct exploration activities and as a result its resources have steadily increased, as disclosed in the Company's updated mineral resource estimate for the Marimaca Oxide Deposit published on May 18, 2023. The Company plans to prepare a feasibility study with respect to the Project, which may include a 50 kt per annum copper cathode production case over a not less than a 15 year life of mine.
There are multiple reasons for this Strategic Investment. Due to its location at a lower altitude of approximately 1,000m above sea level and its proximity to infrastructure such as ports, roads, water and power, the development cost is expected to be competitive. Given the advantage that the Project's copper resources exist in relatively shallow areas, and that copper cathode will be produced at the mine site via leaching process, it would potentially provide relatively low carbon emissions, particularly in respect to mining and transportation. The Project also intends to source 100% of its external power supply from renewable energy, aiming to minimize environmental impact. In addition, since Marimaca owns other exploration concessions surrounding the main mining area, future drilling programs have the potential to unveil further possible resources.
The proceeds from the Strategic Investment will be primarily used to complete the feasibility study of the Project and to prepare for obtaining the environmental permits required prior to the commencement of construction.
MC will contribute to the development of the Project through its extensive knowledge and expertise in the copper mining business that have been accumulated over the past decades, with an aim to commence production by around 2030.
Copper is essential for electrification and de-carbonization, as it plays a crucial role in developing electric vehicles and renewable energy infrastructures, such as wind and solar farms. Although mid-to-long-term demand for copper is expected to keep rising, the decline of ore grades and increasing difficulty in securing environmental permits are growing hurdles to developing new mines, making stable supply a significant concern.
In the "Midterm Corporate Strategy 2024 - Creating MC Shared Value" released in May 2022, MC outlined its growth strategy of accelerating energy transformation, including investment in copper mines. Following the commencement of production at Quellaveco, MC's equity attributable copper production is expected to increase to around 400,000 tonnes per annum. Beyond this Strategic Investment, MC remains committed to further securing a stable and sustainable supply of copper resources.
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Mitsubishi Corporation
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Source: Mitsubishi Corporation
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