Canada Approved Sale of Pan American’s Gold Mine
With this approval, the transaction now has received all of the necessary regulatory approvals and is expected to close by the end of Q4 this year.
SEATTLE (Scrap Monster): Pan American Silver Corp., based in Vancouver, British Columbia, announced that the Government of Canada has approved the sale of its 100% stake in the La Arena open-pit mine and project in Peru Jinteng (Singapore) Mining Pte. Ltd., a subsidiary of Zijin Mining Group Co., Ltd., in accordance with the Investment Canada Act.
Pan American and Zijin must jointly commit to establishing an offtake agreement for the La Arena II project in order for Pan American to obtain 60% of the future copper concentrate produced from La Arena II on commercial terms after commercial production begins.
With this approval, the transaction now has received all of the necessary regulatory approvals and is expected to close by the end of Q4 this year. At closing, Zijin will give Pan American a 1.5% life-of-mine gold net smelter return royalty and pay US$245 million in cash for the La Arena II project. Zijin will also make an additional contingent cash payment of $50 million when commercial production begins.
In 2019, Pan American purchased the mine from Tahoe Resources. Through exploration, it has since added almost half a million ounces of gold. Additionally, the mine life has been extended from 2021 to 2026, with the possibility of further extension.
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