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US$1 Billion Loan Agreements For Sierra Gorda Signed
= To finance the copper/molybdenum mine in Chile =
Sumitomo Metal Mining Co., Ltd. and Sumitomo Corporation jointly announced on March 9 that the two companies and Quadra FNX Mining Ltd. a Canadian company signed loan agreements of US$1.0 billion with 5 Japanese financial institutions to finance the Sierra Gorda Project (estimated capital expenditure is approximately US$3.0 billion).

The one billion U.S. Dollar loan agreements were signed with the Japan Bank for International Cooperation (JBIC), and four Japanese private banks (Mizuho Corporate Bank, Ltd., Sumitomo Mitsui Banking Corporation, The Bank of Tokyo-Mitsubishi UFJ, Ltd. and The Sumitomo Trust & Banking Co., Ltd.) for financing the project. Nippon Export and Investment Insurance (NEXI) will provide insurance to the 4 private banks. Sumitomo Mitsui Banking Corporation serves as a financial adviser.

The two companies are planning a separate long-term loan of approximately US$300 million from several private banks, on which Japan Oil, Gas and Metals National Corporation (JOGMEC) is to provide a guarantee.

The project is for developing Sierra Gorda copper and molybdenum mine in Chile, where the two companies hold a 45% interest in total, and are to import 50% of the copper concentrates (approx. 110,000 tons per year of copper in the concentrates) produced at the mine. Commercial production start-up is scheduled in 2014.

Quadra FNX holds a 55% interest in Sierra Gorda, Sumitomo Metal Mining holds 31.5%, and Sumitomo Corporation has 13.5%.
last modified : Thu 15 Mar, 2012 [10:15]
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