Melbourne-based firm EMR Capital has agreed to buy the Cerro Colorado copper mine in Chile from BHP for a base price of $310 million.
In a deal announced on June 19, EMR will acquire the mine for US$230 million from BHP, and will pay a further US$40 million to the mining giant after it sells some existing copper inventory at the mine.
The deal also includes additional payments to BHP of up to US$50 million, depending on the performance of the copper price.
EMR Capital co-founder Jason Chang told AFR he would be happy to pay BHP every cent of that US$50 million, if it means the copper price has improved to that extent.
“I think it’s a bit of a win-win for the vendor and the buyer,” Chang was quoted as saying. “We’d be very happy making that payment.”
The sale is said by BHP to be subject to financing and customary closing conditions, and is expected to take place in the fourth quarter of the 2018 calendar year.
Cerro Colorado is located in northern Chile’s Atacama Desert. It produced 65,000 tonnes of copper cathode in FY17.