Glencore underwrites Mt Isa copper with US $50m off take

11 June 2024 15:57

29Metals Limited (ASX:29M) has formalised a US$50 million copper and zinc concentrates off take finance facility with Glencore International AG. The completion and execution of the full-form documentation align with the binding terms previously announced on April 22, 2024.

Key Terms

The key terms of the funding include a US$50 million facility with a maturity date of October 1, 2028, with availability for drawdown until April 2028. Interest includes a secured overnight financing rate (SOFR) plus a margin, with an additional 2.0% increase if not cash paid.

Repayment will be in equal monthly instalments beginning in April 2028, and the facility is secured and fully subordinated to the company’s senior lenders. The agreement includes a long-term off take for copper and zinc concentrates on market-based terms.

Highlights Mt Isa copper region

The off-take finance facility provides 29Metals with significant additional liquidity following its Capricorn copper operation setbacks due to extreme weather.

Located within the Mt Isa copper belt, the long-term off take deal for copper concentrates with a global company like Glencore only goes to strengthen the value of other projects located in the renowned copper hot spot.


Figure 1: The Capricorn Copper mine is one of Australia’s biggest copper development projects.

29Metals Capricorn Copper mine is a high-grade copper and silver underground mine located 120km north of Mt Isa. Located just next door is Aruma Resources (ASX:AAJ), who recently acquired the Fiery Creek and Bortala Copper Project’s in the same Mt Isa region.

The Bortala Copper Project is located in the northern area of the Mt Isa copper-belt, residing next to the Capricorn Copper mine. Within the project area several magnetic high zones have been identified by previous explorers.


Figure 2: Geology of the Bortala Project area, located next to the Capricorn Copper mine.

Aruma Resources Managing Director Glenn Grayson commented on the acquisition, citing the bullish long term outlook on copper. “The Company views the ability to acquire this [copper] prospective asset portfolio at a time of prevailing strength in these commodity markets as being potentially transformational.”

Aruma plans to initiate focused fieldwork to identify priority targets for first-phase drilling as soon as they receive shareholder approval.

Castillo Copper (ASX:CCZ) has recently ramped up work at the Big One Deposit, which also stands out as a significant asset in the Mt Isa region.


Figure 3: Line locations transversing Big One Deposit near Mt Isa.

The Project’s potential is highlighted by historical data and high-grade results from three drilling campaigns conducted between 2020 and 2021, verifying grades of up to 28.40% Cu from <50m in supergene ore at the Deposit.

As financing continues to flow for copper projects in the Mt Isa region, these companies may reap the rewards of surging copper prices.

29M’s Australian Security Exchange-listed share price is currently trading at $0.507 (2:00 pm UTC+ 8 hours)

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