Lundin Mining acquires Freeport-McMoRan copper mine in Chile — report

Lundin Mining acquires Freeport-McMoRan copper mine in Chile — report

Candelaria mine is Freeport's fifth biggest copper mine overall by number of union employees and second biggest in Chile.

Canadian Lundin Mining (TSX:LUN) is said to have bought Freeport-McMoRan Copper & Gold Inc. (NYSE:FCX) Candelaria copper mine in Chile, in a transaction valued in over $2 billion.

According to Chilean newspaper El Mercurio (in Spanish), the mine had been in the market for some time as Freeport is under pressure to reduce its debt from its current level of $20.9 billion.

Candelaria —a joint venture between Freeport (80%) and Sumitomo Corp. (20%)— is Freeport's fifth biggest mine overall by number of union employees and second biggest in Chile. It is one of four mines the company owns in South America.

The open-pit and 6,000 metric ton-per-day (mtd) underground copper mine, located in Chile’s copper-rich north, is adjacent to the Ojos del Salado mine.  Combined production from both operation reached 87 million pounds of copper in the first quarter, roughly 9% of total production of the red metal at Freeport's mines.

Thanks to these and other copper assets, the Arizona-based company surpassed Chile’s state copper producer Codelco in 2013, briefly reaching the status of world’s largest copper producer.

Freeport could become the world’s largest copper miner again, according to El Mercurio, as the firm expects to reach 2.1 million tonnes of copper this year, about 20% more that its estimate for 2014. Codelco, in turn, is only expected to reach 2 million tonnes by 2017.

A spokesman for Freeport, the U.S.'s largest miner, with $2.7 billion in profit on $20.9 billion in revenue in 2013, declined to comment on what he called speculation.