Australian mining company Altona has executed an offtake agreement with Glencore for the sale of copper/gold concentrates to be produced at its Cloncurry project.
Altona, which is being bought out by Canada’s Copper Mountain, reported the news to the ASX on Thursday, Glencore would take all the mine’s production for a five-year term, with delivery set at the project’s mine gate.
The Cloncurry copper project is situated between MMG’s Dugald River zinc mine and Glencore’s Ernest Henry copper mine, about 60km north of the town of Cloncurry and about 180km from Glencore’s copper smelter in Mount Isa.
Altona said the terms of the deal with Glencore were “commercial in confidence” but noted that they were competitive.
Altona managing director Alistair Cowden said the execution of an offtake agreement for Altona was a milestone, which would allow Altona and Copper Mountain to fast-track the Cloncurry project.
“We recently announced the acquisition of Altona by Canada’s Copper Mountain Corporation through a Scheme of Arrangement,” Mr Cowden said.
“The parties are collaborating on fast tracking the Cloncurry Project and the announcement of the offtake agreement with Glencore is one of the milestones we are looking to achieve such that the Cloncurry Project can hit the ground running once the Scheme is completed.”
Cloncurry is envisaged as a seven-million-tonne-a-year openpit copper/gold mine and concentrator, producing 39,000 tonnes of copper and 17,200 ounces of gold for a minimum of 14 years.
The project has a mineral resource containing 1.67 million tonnes of copper and 0.43 million ounces of gold.
Altona announced on November 20 that Copper Mountain would buy it out in a deal worth $93 million.
Together they would have a production profile of about 73 000 tonnes a year of copper.
Copper Mountain’s principal asset is a 75%-owned large open pit near Vancouver with Mitsubishi owning the other quarter.