Metals And Mining
Arc Minerals said that Anglo American would become the majority stakeholder of its Zambia copper-cobalt exploration licenses.
The deal marks the first new investment by Anglo American in Zambia in 20 years.
Under the deal, Anglo American will take 70% of a joint venture with Arc Minerals that will own licenses to explore the African country’s copper-rich North-Western province, which was previously studied in the late 1990s by Anglo American.
Major mining firms are searching for new mines for the much sought-after battery metals cobalt and copper, especially in the wake of the war in Ukraine and sanctions on Moscow, which have sent metal prices soaring.
According to the terms of the deal, Anglo American will pay $3.5 million into the joint venture upon signing. It will retain its stake by spending $74 million on exploration within seven years of signing and making cash payments of $11 million into the joint venture.
Africa’s second-largest copper producer, Zambia, has become a more attractive investment proposition for mining firms since the election last August of business-friendly President Hakainde Hichilema and a subsequent mining tax reform.
The African nation aims to triple its annual copper output within the next decade to 3 million tons a year.