First Quantum Minerals FM-T is in talks with potential partners for its Zambian assets, the Canadian miner said on Wednesday, without disclosing names of the firms.
Last week, Reuters reported that Saudi Arabia’s Manara Minerals is closing in on a deal to buy a minority stake in First Quantum’s Zambian copper and nickel assets, citing three people familiar with the details.
“We’re more open to partnerships, and that includes in Zambia, but only if it’s in the interest of our Zambian business, the Zambian government and all the stakeholders involved,” First Quantum CEO Tristan Pascall said on a conference call with analysts.
Shares of the company were up 3 per cent at C$18.93 in morning trading.
The potential Manara Minerals deal, which could be worth between $1.5-billion and $2-billion, is in the spotlight as copper is a much sought-after element for the clean energy transition due to its uses in manufacturing electric cars and supplying power to data centers for artificial intelligence.
For First Quantum, a stake sale in the Zambian mine would help reduce debt that has ballooned after its flagship Cobre Panama mine was ordered shut last December by the Panama government due to public protests. The company is waiting for a decision on the mine’s future and also for approval from Panama’s new government to ship 121,000 metric tons of copper concentrate that is stuck inside the mine.
Approval to sell that copper would provide working capital to maintain the mine.
The Canadian miner is spending between $11-million and $13-million per month to maintain the mine. Pascall warned that in a few months the company would have to cut costs, including reducing the workforce.