Copper producer Austral Resources Australia Ltd (ASX:AR1) has entered into a binding offtake and prepayment facility with one of the world’s largest mining companies, Glencore.
Under the Offtake Agreement, Glencore will have the offtake rights for up to 40,000t of copper cathode production from Austral’s Anthill Mine in Queensland, with offtake scheduled to commence in the second half of 2022.
Glencore will also provide Austral with a A$21m prepayment facility. The A$21m prepayment allows Austral to immediately expedite exploration and development activities through 2022, after which exploration will be internally funded from Anthill cashflow.
Austral’s CEO, Steve Tambanis, said the Offtake Agreement with Glencore follows negotiations held with several parties eager to secure the rights to Austral’s 40,000t of Anthill copper production and obtain an option to participate in the company’s future growth potential.
“We are delighted to have Glencore marketing 40,000t of Austral’s Anthill copper production. Together with this offtake agreement, a A$21m prepayment facility enables us to accelerate our planned exploration programme and importantly, provides a solid financial buffer for Anthill’s start-up phase over the next five months.
“Glencore underwent a lengthy due diligence process to assess our production capabilities and is pleased with the high quality of Austral’s copper cathode. Going forward, there is potential to review other copper development opportunities in the region.
“Austral is on track to achieve a planned copper production rate of 10,000tpa from mid2022 for a four year period. Exploration and development activities are being significantly expanded with the intention of fast-tracking discoveries.
“We have engaged a first-class team of explorationists to undertake this work, have a detailed exploration strategy in place and have funding to enable these programmes. We look forward to further updating shareholders as we prepare to commence maiden production at Anthill and commence exploration and development activities.”
For further information please visit: https://www.australres.com/
