(Corrects headline and first paragraph, adds line to 4th paragraph, to show Antofagasta is set to clinch, not “has clinched”; company corrects its statement)
SANTIAGO, Nov 5 (Reuters) - Chilean miner Antofagasta Plc is poised to sign a deal for $650 million in loans from a group of international banks to help finance its pricey, recently reactivated Antucoya copper project, the company said on Tuesday.
“The end of the financing process ... allows us to make this project viable,” Alfredo Atucha, the company’s vice-president for finance, said in a statement.
The resumption of one of the industry’s most capital- intensive projects has pushed up Antofagasta’s expected 2013 investment to roughly $1.5 billion, Chief Executive Diego Hernandez told Reuters in April. He said the miner was seeking between $400 million and $500 million this year for Antucoya, located in northern Chile.
Financing will be provided by institutions including the Japan Bank for International Cooperation, Export Development Canada, KfW IPEX-Bank GMBH, Mizuho Bank, Sumitomo Mitsui Banking Corp, Natixis, ING Capital LLC and Chilean banks Corpbanca and Banco del Estado , the company said on Tuesday. The deal will be firmed up later on Tuesday, it said.
With an annual production cost of around $22,000 per tonne, Antucoya has sparked investor and analyst concern about its profitability and its potential effect on the London-listed miner’s coffers.
Antofagasta, controlled by Chile’s affluent Luksic family, approved the project in 2011, selling a 30 percent stake to Japanese trading house Marubeni Corp to help with costs.
Antucoya will produce 80,000 tonnes of copper cathodes per year. It is slated to start production in 2015. (Reporting by Alexandra Ulmer; Editing by John Wallace)