Ecora Secures $50 Million Streaming Agreement for Zambian Copper Mine

Ecora Resources has signed a $50 million streaming deal for the Mimbula copper mine in Zambia, ensuring copper remains a central focus of its investment portfolio. The agreement covers an 11-year mine lifespan and is expected to significantly boost earnings and cash flow. The Mimbula project is currently expanding its production capacity, making it a high-margin operation with substantial growth potential.

Ecora Resources, a company specializing in critical minerals royalties, announced a $50 million streaming transaction for Moxico Resources’ Mimbula copper mine in Zambia. This all-cash deal encompasses the entire 11-year lifespan of the mine based on its current reserves, with an option for extension. According to CEO Marc Bishop Lafleche, the acquisition will enhance their engagement with copper, positively impacting earnings and free cash flow.

The Mimbula project, situated in Zambia’s Copperbelt Province, commenced production in late 2022 and is currently in Phase 1, producing high-quality copper cathodes with a consistent copper purity of 99.999%. The ongoing Phase 2 expansion will increase production capacity significantly, from an initial 10,000 tonnes per annum to 56,000 tonnes per annum. Lafleche emphasized the project’s high-quality ore body, low operating costs, and excellent management as significant factors driving investment interest.

Moxico Resources, which possesses a 93% stake in the Mimbula project, anticipates the final stages of expansion will conclude by early next year, achieving full capacity by mid-2026. There are also plans for a future Phase 3, which will involve building an additional processing facility to extract cobalt, given the project’s estimated resource of 38.6 million tonnes grading 0.037% cobalt.

Once completed, the Mimbula copper stream acquisition is set to bolster Ecora’s immediate and long-term copper growth profile. Following this transaction, copper and base metal exposure in Ecora’s net asset value is expected to reach approximately 45% and 75%, respectively, while most of their royalty and streaming assets will be from lower-cost mines and projects.

To finance the $50 million streaming deal, Ecora will utilize available cash and debt, including $30 million from its revolving credit facility. Lafleche stated that the transaction is structured to prioritize early copper earnings, driving revenue growth and aiding in the anticipated debt reduction within the next 12 to 24 months.

Ecora Resources has made a strategic investment by securing a $50 million streaming deal for the Mimbula copper mine in Zambia, signaling a robust commitment to enhancing its copper portfolio. The ongoing expansions at Mimbula position Ecora for significant production increases, contributing favorably to its financial outlook. This transaction exemplifies Ecora’s strategic approach to optimizing its asset base in the critical minerals sector, particularly in copper.

Original Source: www.mining.com