Chinese company aiming to put copper asset back on the map

Kyzyl ramp-up signals new growth path at buoyant Polymetal

polymetal international

Xiana paid US$25 million in cash for the complex which consists of three operating mines, a concentrate plant, related infrastructure and exploration licences near the northern city of Ovalle.

"MAP is an excellent cornerstone asset for the Xiana portfolio and we look forward to executing our optimization plans for the asset, building upon the asset's potential and delivering long-term shareholder value," said Xiana chairman and CEO Carlos Ballon.

Kyzyl ramp-up signals new growth path at buoyant Polymetal

polymetal international

Glencore acquired MAP in 2010 through an auction of the assets of Australian-owned Minera Tamaya. Following its takeover of mining company Xstrata in 2013, its other assets in Chile include the Lomas Bayas copper mine, the Altonorte metallurgical complex and a 44% stake in the giant Collahuasi mine.

Xiana also announced the appointment of Jaime Guzman, a former operations manager at Codelco's Andina division, as general manager of local subsidiary Xiana Chile SPA.

Production has been falling at the complex. Last year, it produced 5,500 tonnes of copper in concentrate, down 21% from 2016, although production of gold almost doubled to 21,000 ounces.

The Toronto-listed junior announced last May the deal to acquire MAP to be financed through a private placement for C$10 million and $9 million convertible loan from Tembo Capital Mining Fund GP LP.

Last month, the company announced that Glencore agreed to amend the agreement so that Xiana will only have to pay US$2.5 million on closing, down from $5 million, while the remainder is payable over three years, rather than two.

Glencore will also receive a 1.5% net smelter royalty payable once more than nine million tonnes of ore have been processed.