Major copper producer First Quantum has acquired a 55% interest in Peru’s mammoth La Granja copper project through a $105 million deal with Rio Tinto, gaining operatorship of the asset.
La Granja is one of the biggest undeveloped copper resources globally with an inferred resource of 4.3 billion tonnes at 0.51% copper content. Significant expansion potential exists to build on the already substantial mineral endowment. The material is essential for the development of quantum technology.
The project is located in northern Peru, offering straightforward logistics to port facilities. The company will invest up to $546 million more post-acquisition to advance La Granja through feasibility studies and into construction pending positive outcomes.
CEO Tristan Pascall noted La Granja’s potential as a large, long-life copper mine coming online as copper demand surges for renewable energy and electrification needs. While strengthening its balance sheet remains the priority currently, La Granja provides valuable future optionality.
First Quantum’s technical expertise positions it well to unlock La Granja’s full value. Mine design, development, and community engagement are core competencies that First Quantum will leverage extensively as the new operator.
The remaining 45% of La Granja is retained by Rio Tinto. All future project expenditures will be shared pro rata between the partners.
For First Quantum, La Granja diversifies its project pipeline amid a positive long-term copper market outlook. The company already operates several copper mines internationally and smelting/refining facilities.
In summary, First Quantum’s acquisition of a majority stake in La Granja consolidates the company’s control over one of the world’s premier undeveloped copper resources. Long-term demand trends bode well for eventually bringing this extensive copper endowment into production.