Troilus in talks on German funding for Quebec gold-copper mine

The German government is in talks with Canadian firm Troilus Mining Corp. to fund investment in a large mining project, helping secure copper supplies that are key to the energy transition.

The money will come from Germany’s new raw materials fund, which allows a capital injection of as much as €150 million ($176 million) per project, according to people familiar with the matter who asked not to be named as the matter is private. 

Copper demand has been soaring on broader optimism around the global energy transition and concerns about future supply disruptions due to mining outages. The metal has benefited from governments worldwide pushing for more green infrastructure, since it’s a key input for electric vehicles, grid upgrades and renewable power.

Montreal-based Troilus plans to revive a gold mine in north-central Quebec, which will also produce copper as a by-product. 

Germany’s raw materials fund is a key tool to secure supplies of such critical inputs and is administered by development bank KfW. It can tap as much as €1 billion of budget resources. Earlier this month, the fund provided part of the financing for Vulcan Energy Resources Ltd.’s lithium project that will use geothermal power. It’s also planning to support another project in Australia. 

The German Economy Ministry didn’t comment on the talks with Troilus. However, a spokesperson said via email that beyond Vulcan, two other projects were currently undergoing in-depth reviews. Troilus did not immediately respond to an email seeking comment.

Troilus had closed an offtake agreement with Germany’s Aurubis AG for copper concentrate in August. The Canadian company has a market value of about C$850 million ($617 million). It counts Quebec’s pension fund manager Caisse de Depot et Placement du Quebec among its top shareholders, according to data compiled by Bloomberg.

Aurubis didn’t comment on the funding talks. 

Troilus has also secured as much as $700 million in financing to restart the mine from KfW, Societe Generale SA and Export Development Canada.

(By Petra Sorge and Mathieu Dion)