REG - Antofagasta PLC - TRANSFER OF CENTINELA WATER SUPPLY INFRASTRUCTURE

AntofagastaAnnouncement

05/06/2024 17:15

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RNS Number : 2872R  Antofagasta PLC  05 June 2024

NEWS RELEASE, 5 JUNE 2024

 

Completion of process to transfer centinela's water supply Infrastructure

Antofagasta plc ("Antofagasta" or the "Company") is pleased to announce that,
following the Company's earlier announcement dated 19 March 2024, the process
to enter into a water transportation agreement by Minera Centinela
("Centinela"), involving its existing water supply and future water supply to
the Centinela Second Concentrator Project, has now been completed.

Under the terms of the agreement, Centinela's existing water transportation
assets and rights have been transferred to an international consortium formed
of experienced partners, Transelec and Almar Water Solutions ("Almar"), with
Centinela set to receive cash proceeds of $600 million during 2024. In
addition, the planned expansion of the water transportation system will now be
undertaken by the acquiring consortium, resulting in a reduction in the
overall capital cost of the Centinela Second Concentrator Project by
approximately $380 million, with this reduction to be realised over the course
of the project's construction period. Following completion, the acquiring
consortium will operate Centinela's existing water infrastructure.

The Company has assessed that the terms of the agreement are value accretive,
as previously referenced in the Company's announcement in March. The acquiring
consortium has a track record of building and operating infrastructure in
Latin America, the Middle East and Asia, including existing projects in Chile.

Antofagasta's CEO, Iván Arriagada said: "Following today's news and the
recently announced Centinela Second Concentrator Financing, we are in a good
position to advance our growth ambitions in producing responsible copper for
the global energy transition at a time when the global supply of copper has a
limited ability to meet the expected medium-term rise in demand."

Antofagasta's CFO, Mauricio Ortiz said: "The agreement announced today is
underpinned by our long-life resource base at Centinela and our capital
allocation framework. By entering into this value accretive agreement, we have
been able to reduce the capital intensity of the Centinela Second Concentrator
Project, whilst protecting Centinela's competitiveness."

 

Centinela Second Concentrator Project

The Centinela Second Concentrator Project will add 170,000 tonnes of annual
copper-equivalent production, comprising 144,000 tonnes of copper production
and associated gold and molybdenum by-products. 1  (#_ftn1) Through this
expansion, it is expected that Centinela will improve its cost competitiveness
through an increased focus on concentrator capacity that incorporates modern
technologies, increased by-products and greater economies of scale. First
copper production from the project is expected in 2027.

Antofagasta is focused on responsible water use as part of its purpose of
delivering mining for a better future. The Second Concentrator Project is an
opportunity to provide additional copper from the Company's existing resource
base using 100% renewable electricity and raw sea water.

About Transelec

Transelec (Transelec Group) is the leading provider of high voltage systems in
Chile, with over 11,000 kilometres of transmission lines and more than 80
substations in Chile, powering 98% of Chile's population. Transelec is also
present in Peru, through its fully owned subsidiary Conelsur, and in the water
infrastructure industry, through its 40% stake in Aguas Horizonte.

About Almar Water Solutions

Almar Water Solutions, part of Jameel Environmental Services, is a leading
company in the development of unconventional water infrastructure and
production, distribution, and treatment services for both the municipal and
industrial sectors. The company specializes in the development, design,
management, financing, and operation of infrastructure, covering a wide range
of solutions such as purification, desalination, treatment, and reuse. For
more information, visit www.almarwater.com (http://www.almarwater.com) .

 

 

 Investors - London                                                                   Media - London
 Rosario Orchard      rorchard@antofagasta.co.uk (mailto:rorchard@antofagasta.co.uk)  Carole Cable   antofagasta@brunswickgroup.com (mailto:antofagasta@brunswickgroup.com)
 Robert Simmons       rsimmons@antofagasta.co.uk (mailto:rsimmons@antofagasta.co.uk)  Telephone      +44 20 7404 5959
 Telephone            +44 20 7808 0988

                                                                                      Media - Santiago
                                                                                      Pablo Orozco   porozco@aminerals.cl (mailto:porozco@aminerals.cl)
                                                                                      Carolina Pica  cpica@aminerals.cl (mailto:cpica@aminerals.cl)
                                                                                      Telephone      +56 2 2798 7000

 

 

 

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_____________________________________________________________________________________________

Cautionary Statement

This announcement contains certain forward-looking statements. All statements
other than historical facts are forward-looking statements. Examples of
forward-looking statements include, without limitation, those regarding the
Group's strategy, plans, objectives or future operating or financial
performance, reserve and resource estimates, commodity demand and trends in
commodity prices, growth opportunities, and any assumptions underlying or
relating to any of the foregoing. Words such as "intend", "aim", "project",
"anticipate", "estimate", "plan", "believe", "expect", "may", "should",
"will", "continue" and similar expressions identify forward-looking
statements.

 

Forward-looking statements involve known and unknown risks, uncertainties,
assumptions and other factors that are beyond the Group's control. Given these
risks, uncertainties and assumptions, actual results, performance or
achievements could differ materially from any future results, performance or
achievements expressed or implied by these forward-looking statements, which
apply only as at the date of this report. These forward-looking statements are
based on numerous assumptions regarding the Group's present and future
business strategies and the environment in which the Group will operate in the
future. Important factors that could cause actual results, performance or
achievements to differ from those in the forward-looking statements include,
but are not limited to: natural events, global economic and financial
conditions (which may affect our business, results of operations or financial
condition); various political, economic, legal, regulatory, social and other
risks and uncertainties across jurisdictions in which the Group operates;
changes to mining concessions or the imposition of new mining royalties, or
changes to existing mining royalties in the jurisdictions in which the Group
operates; the Group's ability to comply with the extensive body of regulations
governing the mining industry, as well as the need to manage relationships
with local communities; the ongoing effects of the global COVID-19 pandemic;
demand, supply and prices for copper and other long-term commodity price
assumptions (as they materially affect the timing and feasibility of future
projects and developments); trends in the copper mining industry and
conditions of the international copper markets; the effect of currency
exchange rates on commodity prices and operating costs; the availability and
costs associated with mining inputs and labour; operating or technical
difficulties in connection with mining or development activities; risks,
hazards and/or events and conditions inherent to the mining industry, which
may affect our operations or facilities; employee relations; climate change as
well as the effects of extreme weather conditions; the outcome of any
litigation arbitration, regulatory or administrative proceedings to which the
Group is and may be subject in the future; and actions and activities of
governmental authorities, including changes to laws, regulations or taxation.

 

Except as required by applicable law, rule or regulation, the Group does not
undertake any obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or
otherwise. Past performance cannot be relied on as a guide to future
performance.

 

No statement in this announcement is intended as a profit forecast or estimate
for any period. No statement in this announcement should be interpreted to
indicate a particular level of profit and, as a consequence, it should not be
possible to derive a profit figure for any future period from this report.

 

 1  (#_ftnref1) Production averages over an initial 10-year period.

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