Glencore Canada has formed a new company through a joint venture (JV) limited partnership with Ontario Teachers’ Pension Plan to focus on base metals streams and royalties.
Glencore has contributed a portfolio of selected royalties in the JV called BaseCore Metals, while Ontario Teachers acquired its interest for cash.
The initial value of the royalty portfolio of the new partnership is expected to be around $300m.
Glencore CEO Ivan Glasenberg said: “The creation of BaseCore Metals is unique in the sector and will enable us to secure further offtakes for our marketing business.
“We are pleased to be partnering with Ontario Teachers’ to take advantage of the significant opportunities that are expected to emerge across the sector in the coming years.”
Ontario Teachers’ Pension Plan Infrastructure and Natural Resources senior managing director Andrew Claerhout added: “This investment in BaseCore Metals and base metal streams and royalties reflects an important component of Ontario Teachers’ Natural Resources mandate to ensure attractive relative returns through exposure to commodities that are well-positioned to benefit as the world transitions to a low-carbon economy.”
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The portfolio includes certain existing royalties on properties at various stages of producing and development in North and South America, including the Antamina and Highland Valley mines, as well as the Horne 5 and El Pilar projects.
According to Glencore, the objective of BaseCore Metals will be to explore investment opportunities, focusing primarily on base metals streams and royalties.
Through BaseCore Metals, Glencore intends to provide future transaction partners with deep sector expertise, operations and technical skills, in addition to capital funding.
BaseCore Metals will operate as an independent entity.