Marimaca Copper Marches Towards First Production in Chile's Copper Heartland

• Marimaca Copper is developing the Marimaca project in Chile and has appointed Ausenco to lead the permitting and definitive feasibility study.
• The DFS will determine capital and operating costs to reach construction decisions and production. It will assess technical factors like mining, processing, and recoveries.
• The project appears financially robust with low capital intensity and competitive operating costs, which should attract debt financing.
• Giancarlo Bruno Lagomarsino, an experienced Chilean mining executive, was hired to aid permitting and development. His relationships will be invaluable.
• Permitting is expected to take 12 months starting mid-2024. Construction could begin 2025-2026 with production starting late 2026 or 2027.

About Marimaca Copper

Chilean copper developer Marimaca Copper has set its sights on becoming one of the few new copper mines to enter production within the next 5-years. With permitting underway and a definitive feasibility study commencing, the company is swiftly advancing its Marimaca project to take advantage of soaring copper demand.

Located in the Antofagasta region of northern Chile, Marimaca will benefit from its prime position within the world’s leading copper-producing nation. Chile is renowned for its copper endowment and mining-friendly jurisdiction. Major miners like BHP and Anglo-American have operated there for decades. This bodes well for Marimaca as it navigates the country’s rigorous but established permitting process.

Interview with President & CEO, Hayden Locke

Appointing an Accomplished Partner

In a key step forward, Marimaca has appointed Chilean engineering firm Ausenco to manage permitting and the definitive feasibility study (DFS) for the Marimaca project. Ausenco recently oversaw the construction of the Mina Justa copper mine, providing invaluable hands-on experience.

The DFS will assess all technical and financial aspects of the project in detail, providing certainty around capital and operating costs. With Ausenco’s assistance, Marimaca will optimize its mine plan and processing design to ensure smooth, low-cost operations.

Attractive Economics Should Ease Financing

Preliminary studies indicate Marimaca Copper will be a financially robust project, thanks to modest upfront capital requirements and competitive operating costs. This should make debt financing relatively straightforward.

With capital costs in the bottom quartile for comparable copper projects, Marimaca can limit its equity dilution. Meanwhile, its projected all-in sustaining costs in the $1.75/lb - $2.15/lb range will provide healthy margins at current and anticipated copper prices.

Marimaca’s economics are underpinned by simple open-pit mining and conventional processing techniques. Capital intensity has been minimized by focusing only on the highest-grade zones of mineralization. This selectivity avoids mining and processing excessive waste material.

Permitting Already Underway

Keen to expedite project development, Marimaca has elected to front-load its permitting activities. The company plans to submit permits in mid-2024, well in advance of completing its DFS.

Marimaca Copper will apply through Chile’s less onerous Environmental Impact Assessment (EIA) process, which typically takes 12 months or less. There is a risk of delay if further assessment is required under the more rigorous Environmental Impact Study process, which could extend the timeline by up to one year.

Either way, Marimaca remains on track to commence construction between mid-2025 and mid-2026. This would see first copper production occur in late 2026 or 2027 based on the current schedule.

New Chilean Leadership to Propel Development

Supporting its ambitious development timeline, Marimaca has recruited extensively experienced Chilean mining executive, Giancarlo Bruno Lagomarsino, to oversee permitting and construction.

As former CEO of Mantos Copper, Lagomarsino led the phenomenal growth of that company before its merger into Capstone Copper. His connections in Chilean mining and government circles will prove invaluable during permitting and beyond.

Giancarlo also recently oversaw the development of the Monteverde copper project for Capstone, providing vital hands-on experience in taking a Chilean copper project into production. This expertise will be indispensable as Marimaca transitions to a construction-ready footing over the next two years.

Financing Secured Through Construction

Marimaca Copper currently has sufficient capital to fund its activities for the next 18 months, including permits, DFS, early engineering and adding to its owner’s team. This ensures the company can maintain momentum without financial constraints.

Strategic partner Mitsubishi Corporation has committed additional capital to take its ownership stake to nearly 10% in Marimaca. Mitsubishi’s strong backing demonstrates confidence in the project’s prospects.

Looking ahead, Marimaca anticipates starting detailed engineering and design in 2024 after completing its DFS. Combined with a green light on permitting, this would pave the way for a final investment decision and the commencement of full-scale construction around 2025-2026.

Industry Conditions Aligning

The timing for Marimaca’s anticipated production start could hardly be better, with the project coming online just as analysts foresee looming copper shortfalls. There is a distinct lack of new copper projects ready to fill this supply gap.

Demand for the metal continues to accelerate, fueled by renewable energy, electric vehicles and electrification. Yet analyst Wood Mackenzie has warned that new mine supply will struggle to keep pace with consumption growth after 2025.

This sets the scene for further gains in the copper price, which remains well below its 2011 peak despite recent strength. Marimaca’s low-cost planned production should reap the full benefit of higher prices just as shortfalls emerge.

Marimaca offers investors a rare chance to gain exposure to a near-term construction-ready copper developer, just as the outlook for copper turns decidedly bullish. With permitting progressing smoothly, the final investment decision potentially only two years away and development partners in place, the company is positioned for successful delivery of its maiden copper mine in the heart of Chile’s copper belt.

The Investment Thesis for Marimaca Copper

• Near-term construction-ready copper project in mining-friendly Chile
• Modest capital intensity and low operating costs ensure robust economics
• Experienced partner appointed to de-risk development and permitting
• Development timeline positions first production to benefit from the looming copper supply gap
• Demand growth from EVs, and renewable energy supports a bullish copper price outlook
• Mitsubishi partnership provides a strong stamp of approval and financial backing
• Current funding sufficient to progress through permitting and DFS
• Final investment decision potentially as soon as 2025 for construction start
• Opportunity to gain leverage to copper price upside with near-term producer
• Marimaca Copper offers scarcity value as one of few new copper projects globally