First Quantum receives interest in Zambia copper mines

First Quantum Minerals has received interest from multiple parties hoping to buy a minority stake in its Zambian copper operations as the Canadian miner looks to offset financial damage caused by the closure of its flagship mine in Panama.

According to Bloomberg, First Quantum’s chairman, Robert Harding, said the company had signed non-disclosure agreements with several groups interested in a stake in the African mines and expects to soon allow access to data for due diligence. No timeline or details about the parties were specified.

Harding told Bloomberg in an interview on Monday: “We are busy getting the data room available for people to be able to look at the data, but there isn’t a specific time frame. It will take whatever it takes for those other organisations to go through the data room and make decisions, and come back to us with potential proposals.”

Since the enforced closure of its Cobre Panamá mine last year, First Quantum has experienced financial difficulty as the mine was responsible for around 40% of its revenue. Its net debt increased to $6.42bn at the end of December and almost 121,000 dry tonnes of copper at the closed mine remain unsold.

To sure up its balance sheet, it received a $500m (C$672.83m) injection from Chinese state-owned Jiangxi Copper, the company’s largest shareholder, last month. It also sold around $1.15bn in stock and raised $1.6bn from a notes offering last month, and it is considering the sale of smaller mining assets.

First Quantum’s Zambian copper assets are the Sentinel and Kansanshi mines. Last year, Zambia accounted for around half the company’s copper output and revenue, delivering more than $450m in operating profit.

Harding is looking for partners in Zambia that could “take interest in that asset but also be interested in working with us on a future project”.