Reuters: Regulatory News: Inmet outlines $6.2 bln development plan for Cobre Panama

Reuters: Regulatory News Reuters.com is your source for breaking news, business, financial and investing news, including personal finance and stocks. Reuters is the leading global provider of news, financial information and technology solutions to the world's media, financial institutions, businesses and individuals. // via fulltextrssfeed.com

Inmet outlines $6.2 bln development plan for Cobre Panama May 7th 2012, 12:10 TORONTO | Mon May 7, 2012 8:10am EDT TORONTO May 7 (Reuters) - Inmet Mining Corp completed a long awaited engineering study on its Cobre Panama copper-molybdenum project in Central America that pegged development costs for the asset at $6.2 billion. The base metal miner plans to fund the project using cash on hand, debt and other options. Toronto-based Inmet, which is developing the Panamanian project in partnership with a South Korean consortium, said in a statement late on Sunday that it intends to retain an 80 percent stake in the asset for now, but it did not firmly close the door on potentially selling a stake in Cobre Panama down the road. Inmet announced a $1 billion senior unsecured note offering to help finance the project that is expected to produce 266,000 tonnes of copper, on average, over a roughly 31-year mine life. The company is also mulling a precious metals stream financing deal to help fund a part of the construction costs. "We are currently engaged in discussions with interested parties to sell a portion of future gold and silver production attributable to our 80 percent interest in Cobre Panama," the company said in its statement. The mine is expected to annually produce about 87,000 ounces of gold and 1.5 million ounces of silver, on average, over its mine life. Inmet plans to raise roughly $1 billion through the stream financing deal. It also plans to utilize $1.7 billion of cash on hand, $1.5 billion of cash flow from its existing mines, and $1.4 billion from its partners LS-Nikko Copper Inc and Korea Resources Corp to help fund the development of the asset. Inmet said it plans to raise a further $1 billion via the sale of additional equity in the project, project debt financing or other options. As widely expected, the latest capital cost projection for Cobre Panama rose significantly to $6.18 billion from an earlier estimate of $4.32 billion. The latest estimate includes roughly $650 million in costs for a power plant that was not part of the prior study done in 2010. The new study also forecast a roughly $400 million increase in process plant capital costs and about $800 million in other cost increases. Link this Share this Digg this Email Reprints

You are receiving this email because you subscribed to this feed at blogtrottr.com. If you no longer wish to receive these emails, you can unsubscribe from this feed, or manage all your subscriptions