Australian junior sets foot in Chile’s copper sector
Australian junior explorer Mining Group (ASX: MNE) signed Wednesday a production agreement that allows the miner to be part El Roble copper project in Chile, and grants it access to the historic Panga mine.
Mining Group will start by extracting 5,000 tonnes of ore per month, subject to more than a few of conditions, including a monthly payment of $2,000.
The first $200,000 of revenue generated from the operation would also be subject to a 10% royalty, and every subsequent dollar of revenue over the $200,000/m limit would be subject to a 5% royalty, the company said.
Royalty payments would be made in lieu of the minimum monthly payment when royalty payments exceed $2 000/m, with Mining Group being held liable for the minimum monthly payments from January next year.
Initial engineering assessment of the Panga Mine indicates the ground conditions are favourable for underground mining.
Mining Group said it will conduct more detailed geology and engineering studies at the site and hopes to make a decision early next year.
Chile, the world's largest copper producer, is expecting an output of about 5.7 million tonnes of copper this year, an increase of almost 5% on last year and a historic high, thanks mostly to better output forecasts from key mines including Escondida, the world's biggest.