Antofagasta has finalised definitive agreements with a consortium of international lenders on the $2.5bn project financing for a second concentrator at its Centinela copper mine in Chile.

This loan facility has a term of around 12 years and a four-year drawdown period.

The lenders’ group comprises the Japan Bank for International Cooperation, Export Development Canada, the Export-Import Bank of Korea and several commercial banks.

The Centinela Second Concentrator Project is set to enhance the company’s copper-equivalent production by 170,000 tonnes (t), which includes 144,000t of annual copper production along with gold and molybdenum byproducts.

The project aims to elevate Centinela’s cost competitiveness by leveraging modern technologies, increasing byproducts and achieving greater economies of scale. The first copper production from this expansion is anticipated in 2027.

In a separate development, Centinela secured an option to receive water for its operations from an international consortium.

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This agreement involves the consortium acquiring Centinela’s existing water supply system and constructing an expansion to support the new concentrator project. The consortium’s financing closure is expected within the year.

As part of the water supply agreement, Centinela will transfer its water transportation assets and rights for an estimated $600m, which is expected to be received in 2024.

Furthermore, the consortium will handle the construction and capital expenditure of nearly $380m for the water transportation system’s expansion.

Antofagasta owns 70% of the Centinela mine, while Japan’s Marubeni Corporation owns the remainder.

The mining operation is noted for exclusively using seawater and 100% renewable energy for its electrical power needs.

Antofagasta CEO Iván Arriagada said: “We have agreed competitive financing terms with strong international lenders, which is testament to the high-quality nature of this project.

“The Centinela Second Concentrator Project is a prime example of how Antofagasta can unlock value from its portfolio, and our dedication to sustainable and responsible copper production.

“The company remains focused on delivering growth and returns, while maintaining a strong balance sheet.”