First Quantum acquires new Peruvian mine

Marion Dakers
FIRST Quantum Minerals said it has paid C$460m (£285m) for Antares Minerals yesterday, in a move to diversify following the confiscation of its copper mine in the Democratic Republic of Congo.

Antares’ principal asset is the Haquira copper project in southern Peru, which contains around 3.7m tonnes of copper equivalent. It also lies next to Xstrata’s Las Bambas copper-gold project, and First Quantum chairman Clive Newall said the two companies could work together.

“There are some potential synergies in the region with Xstrata. The infrastructure in the area is relatively undeveloped,” he said yesterday. “It’s unlikely that we would be sharing a pipeline, but we could share power supplies.”

First Quantum paid investors in Canada-based Antares a 41 per cent premium on Friday’s closing share price. The Peruvian mine will not be ready for mining for around 18 months, Newall said, but engineers will be on the site soon after the sale.

The mine can produce 230,000 tonnes of copper concentrate a year in the first 10 years, and will account for just less than a third of First’s total copper production by 2015, Newall said.

The purchase was not just a result of the loss of the company’s Congolese assets after the government seized its Kolwezi mine, Newall said, adding: “It has been part of our strategy to look for the right project in Latin America.”

First Quantum is in arbitration with FTSE 100-listed miner ENRC, after the Congolese government cancelled First’s licence at the Kolwezi mine and later sold it to ENRC.

ENRC has said it carried out extensive due diligence and it would vigorously challenge First Quantum’s legal claim to the $750m project.