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Canadian mining entrepreneur Rob McEwen landed a big fish for his new copper unit, with a Rio Tinto Group venture set to take an almost 10% stake for $25 million as major producers line up new deposits to meet demand growth.
Rio’s copper leaching technology venture, Nuton, snapped up most of the McEwen Copper Inc. shares in the final tranche of a private placement. Parent McEwen Mining Inc. rose after the announcement Wednesday but had given back most of the gains by 10 a.m. in New York on Thursday. The copper unit is set to go public next year.
The focus for Rio is McEwen’s Los Azules property in Argentina’s San Juan province, near the border with Chile. In connection with the offering, McEwen will look into using Nuton’s heap leach technology at Los Azules. Leaching can be cleaner and cheaper than conventional milling, and may help speed up development.
Los Azules is billed as one of the bigger undeveloped copper assets in the world at a time when the industry’s project pipeline is starting to run dry and demand for copper is about to expand in the move away from fossil fuels.
“I understand that Rio is using Nuton as a way of gaining property interest,” Rob McEwen said in an interview after the announcement. “They’re trying to use their technology to gain equity interest in properties that they find interesting.”
To be sure, the Argentine government’s protectionist bent and politically volatile past mean it’s still a tricky place to do business. But the government is now making efforts to develop more of its vast deposits of lithium and copper that are critical to the clean-energy transition.
Argentina’s tax system and capital and foreign exchange controls are “not optimal but they are talking like they want to move” in the direction of making changes, McEwen said.
(By James Attwood)
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