Ecora Resources Secures $50 Million Copper Stream Agreement with Moxico

Ecora Resources has entered a $50 million copper stream agreement with Moxico Resources for the Mimbula copper mine in Zambia, which spans an 11-year reserve life. The arrangement is designed to mitigate ramp-up risks and improve cash flow. Ecora’s CEO, Marc Bishop Lafleche, underscores the strategic value of Mimbula, which includes low operating costs and expansion potential.

Ecora Resources, a royalty and streaming company centered on critical minerals, has announced a significant copper stream agreement valued at $50 million with Moxico Resources. This agreement pertains to copper production at the Mimbula mine located in Zambia and is strategically aligned with Ecora’s goal to bolster its copper growth profile while enhancing earnings over both the short and long term.

The stream encompasses the current reserve-based life of mine (LOM) at Mimbula, which spans 11 years, including options for future extensions. After Ecora acquires 9,150 tonnes of copper—projected to occur within approximately seven to eight years—its entitlement will be reduced to 1% of the copper cathode output for the mine’s operational lifespan. Copper will be delivered quarterly, with Moxico receiving payments equating to 30% of the average quarterly copper price on the London Metal Exchange for all copper under the stream.

This structured stream arrangement aims to reduce ramp-up risk, with a payback period expected within six to seven years. To fund this transaction, Ecora has drawn $30 million from a $75 million revolving credit facility, elevating its total lending facility to $180 million, with approximately $55 million still available for future use.

Marc Bishop Lafleche, Chief Executive Officer of Ecora, expressed optimism over this new partnership with Moxico, indicating it will fortify copper’s significance within their commodity portfolio and contribute positively to earnings as well as free cash flow. Lafleche emphasized that Mimbula comprises the key attributes sought in an investment, including a quality ore body, cost efficiency, and an accomplished management team overseeing the transition from concept to a profitable operation, currently undergoing brownfield expansion.

Housed in the Zambian Copperbelt Province, the Mimbula mine commenced copper production in late 2022 and boasts impressive margins with low operating costs. In 2024, production totaled 14,000 tonnes at operational costs that rank within the lowest global tiers. A second-phase expansion is currently in progress, forecasted to elevate copper cathode output to approximately 56,000 tonnes annually by mid-2026.

The financial inflow generated from this stream is intended to bolster liquidity for Mimbula’s expansion endeavors and other corporate needs. The transaction’s completion is projected to occur shortly. Furthermore, Atlantic Metals, a subsidiary of Moxico Resources, recently entered into an agreement with Latin Metals to acquire a 75% stake in two copper exploration projects situated in Argentina.

In summary, Ecora Resources has secured a $50 million copper stream agreement with Moxico Resources to support operations at the Mimbula mine in Zambia. The deal is strategically aligned with Ecora’s ambitions to enhance its copper portfolio, promising immediate benefits to earnings and liquidity during the mine’s operational life. The ongoing developments at Mimbula indicate a robust future for copper production in the region.

Original Source: www.mining-technology.com