Anglo American formally seals copper pact with Codelco in Chile

Anglo American PLC said on Tuesday it has concluded a copper tie-up with the Chilean state-owned mining company Codelco.

This comes after the two companies back in February this year signed a memorandum of understanding for a framework to implement a joint mine plan for their adjacent copper mines of Los Bronces and Andina in Chile.

The new operating company of the joint mine is jointly owned and controlled by Anglo American’s 50.1%-owned Anglo American Sur SA and Codelco.

On Tuesday, Anglo American said Anglo American Sur and Codelco have entered into a definitive agreement to implement a joint mine plan for their adjacent copper operations.

This transaction is subject to competition and regulatory approvals, and the joint mine plan is subject to securing the relevant environmental permits.

The joint mine plan has been developed to unlock an additional 2.7 million tonnes of copper production over a 21-year period once relevant permits are in place, currently expected in 2030, Anglo American said.

The expected additional copper production of 120,000 tonnes per year is to be shared equally, with 15% lower unit costs relative to standalone operations and with minimal incremental capital expenditure.

The transaction is expected to generate a pretax net present value uplift of at least $5 billion, to be shared equally between Anglo American Sur and Codelco.

The combined production from Los Bronces and Andina in 2024 would rank in the top 10 copper mines globally. Once adjusted for the incremental 120.000 tonnes per year expected under the joint mine plan, it would rank within the top five, Anglo American said.

Shares in Anglo American were 0.9% higher at 2,583.00 pence each on Tuesday morning in London. They were up 0.6% at R 609.52 each in Johannesburg.

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