- Divestment of non-core assets advances the
Company's portfolio optimization strategy
- Total cash proceeds of US$593 million
strengthen the balance sheet
- Reduces 2023 and future care and
maintenance costs
Pan American Silver Corp. (NYSE: PAAS) (TSX: PAAS) ("Pan
American" or the "Company") is pleased to announce the status of
our divestment of certain non-core assets, including the sale of
our interest in the MARA project in Argentina, the Morococha mine
in Peru, and the Agua de la Falda project in Chile.
"The sale of these non-core assets is aligned with our stated
aim of optimizing our portfolio following the Yamana acquisition.
These transactions not only reaffirm our commitment to our core
business but also yield substantial and immediate value to our
shareholders, while maintaining future upside through the retention
of copper and gold royalties with strong counterparties," said
Michael Steinmann, President and Chief Executive Officer of Pan
American. "The consideration for the sale of MARA, coupled with the
other sales, will yield total cash proceeds of US$593 million. The
cash proceeds will allow us to both fully repay the amount drawn on
our credit facility and increase our cash position, further
enhancing the resilience of our balance sheet. These transactions
will also allow Pan American to reduce its annual project
development, reclamation and care and maintenance costs, which for
MARA and Morococha amounted to US$15.7 million in Q2 2023. This
improved balance sheet strength creates enhanced opportunities for
the Company, providing increased capital to advance key strategic
projects, including the La Colorada Skarn Project."
MARA
Pan American has entered into a binding agreement to sell its
56.25% interest in the MARA Project ("MARA" or the "Project"),
located in the Catamarca province of Argentina, to Glencore
International AG ("Glencore"). Pan American acquired its 56.25%
interest in MARA through its acquisition of Yamana Gold Inc.
("Yamana"), which closed on March 31, 2023. At present, Glencore
holds a 43.75% interest in MARA, and upon the completion of the
transaction, Glencore will assume 100% ownership of the
Project.
MARA was initially established as a joint venture in December
2020 amongst Yamana, Glencore and Newmont Corporation ("Newmont"),
following the integration of the Minera Alumbrera plant and mining
infrastructure and the Agua Rica project. On September 23, 2022,
Glencore announced that it had acquired Newmont’s 18.75% interest
in MARA, thereby increasing its ownership in the Project to 43.75%,
at that time.
Under the terms of the agreement, at closing Glencore will pay
US$475 million, in cash, and will grant Pan American a life-of-mine
copper net smelter return ("NSR") royalty of 0.75%, with the right
for Pan American to freely transfer the royalty.
MARA feasibility studies, reclamation and care and maintenance
("C&M") costs for the Project for the three-month period ending
June 30, 2023, amounted to US$11.5 million for Pan American's
portion. Future C&M costs will be eliminated upon closing of
the transaction. Pan American estimated MARA feasibility studies,
reclamation and C&M costs for the Project of US$60 million to
US$65 million on a 100% ownership basis for 2023, as per the
Company’s guidance provided on May 10, 2023.
The closing of the transaction is subject to customary
conditions and regulatory filings. Pan American expects the
transaction to be completed in the third quarter of 2023.
Morococha
Pan American placed the Morococha mine on C&M in early 2022,
while it evaluated alternative strategic opportunities for the
asset following the closure of the Amistad processing plant,
pursuant to an agreement with Aluminum Corporation of China
("Chinalco"). As previously disclosed, in June 2010, the Company
finalized a framework agreement with Chinalco that entailed the
relocation of core Morococha facilities, including the Amistad
processing plant, in stages, to facilitate the incremental
expansion of Chinalco’s Toromocho open pit copper mine.
On June 19, 2023, Pan American entered into a binding agreement
to sell its 92.3% interest in Compañia Minera Argentum S.A.
(“CMA”), its Peruvian subsidiary that owns the Morococha mine, to
Alpayana S.A. ("Alpayana"), also a Peruvian mining company.
Alpayana owns a number of operating mines in the region.
Under the terms of the agreement, Alpayana will acquire the
shares of CMA in exchange for a cash consideration of US$25
million, payable upon closing of the transaction. The completion of
the transaction is subject to customary conditions and regulatory
approval from the Peruvian National Institute for the Defense of
Competition and Protection of Intellectual Property. Pan American
expects the transaction to be completed in the third quarter of
2023.
C&M costs for the Morococha mine for the six-month period
ending June 30, 2023 amounted to US$13.2 million. Future C&M
costs will be eliminated upon closing of the transaction.
As a result of this executed agreement, the net assets of CMA,
including the Morococha mine, will be classified as "held for
sale", and accordingly will be presented separately under current
assets and liabilities in the Company’s second quarter 2023
unaudited interim consolidated financial statements. Further, a net
of tax impairment charge of US$33.3 million (US$42.4 million pre
tax) will be taken to the CMA net assets.
Agua de la Falda
Pan American has entered into a binding agreement with Rio Tinto
Mining & Exploration Ltd. Agencia en Chile SPA ("Rio Tinto"), a
subsidiary of Rio Tinto Limited, to sell its 57.75% interest in
Agua de la Falda S.A. ("ADLF"), a Chilean company that holds the
historical Jeronimo project, located in the Atacama region of
northern Chile, as well as several adjoining concessions, that are
indirectly wholly owned by Pan American. Pan American acquired its
interest in ADLF through its acquisition of Yamana. The remaining
42.25% interest is held by Corporación Nacional del Cobre de Chile
("CODELCO").
Under the terms of the agreement, Rio Tinto will pay US$45.55
million, in cash, upon closing and will grant Pan American a NSR
royalty of 1.25% on all precious metals and a NSR royalty of 0.2%
on all base metals, on a pro rata basis in accordance with the
interest acquired by Rio Tinto, on production from certain mineral
concessions.
The closing of the transaction is subject to the execution of
definitive documentation and customary conditions. No regulatory
approvals or filings are required. Pan American expects the
transaction to be completed in the third quarter of 2023.
Equity Interests
During the second quarter of 2023, Pan American divested of a
number of non-controlling equity investments for a total
consideration of US$47.1 million.
About Pan American Silver
Pan American Silver is a leading producer of precious metals in
the Americas, operating silver and gold mines in Canada, Mexico,
Peru, Bolivia, Argentina, Chile and Brazil. We also own the Escobal
mine in Guatemala that is currently not operating, and we hold
interests in exploration and development projects. We have been
operating in the Americas for nearly three decades, earning an
industry-leading reputation for sustainability performance,
operational excellence and prudent financial management. We are
headquartered in Vancouver, B.C. and our shares trade on the New
York Stock Exchange and the Toronto Stock Exchange under the symbol
"PAAS".
Learn more at panamericansilver.com.
Cautionary Note Regarding Forward-Looking Statements and
Information
Certain of the statements and information in this news release
constitute "forward-looking statements" within the meaning of the
United States Private Securities Litigation Reform Act of 1995 and
"forward-looking information" within the meaning of applicable
Canadian provincial securities laws. All statements, other than
statements of historical fact, are forward-looking statements or
information. Forward-looking statements or information in this news
release relate to, among other things: the receipt of any necessary
regulatory approvals and successful completion of the proposed
transactions in respect of MARA, Morococha and Agua de la Falda
(the "non-core assets"), as well as the anticipated terms and
timing for the completion thereof; the anticipated use of proceeds,
including to fully repay the amount drawn on our credit facility;
the anticipated benefits from the completion of the sale of the
non-core assets; and the impact of such transactions on Pan
American’s future financial or operational performance.
These forward-looking statements and information reflect Pan
American’s current views with respect to future events and are
necessarily based upon a number of assumptions that, while
considered reasonable by Pan American, are inherently subject to
significant operational, business, economic and regulatory
uncertainties and contingencies. These assumptions include: the
ability to satisfy the closing conditions and, where necessary,
receive regulatory approval, to complete the sale of the non-core
assets; the impact of inflation and disruptions to the global,
regional and local supply chains; tonnage of ore to be mined and
processed; future anticipated prices for gold, silver and other
metals and assumed foreign exchange rates; the timing and impact of
planned capital expenditure projects, including anticipated
sustaining, project, and exploration expenditures; the ongoing
impact and timing of the court-mandated ILO 169 consultation
process in Guatemala; ore grades and recoveries; capital,
decommissioning and reclamation estimates; our mineral reserve and
mineral resource estimates and the assumptions upon which they are
based; prices for energy inputs, labour, materials, supplies and
services (including transportation); no labour-related disruptions
at any of our operations; no unplanned delays or interruptions in
scheduled production; all necessary permits, licenses and
regulatory approvals for our operations are received in a timely
manner; our ability to secure and maintain title and ownership to
mineral properties and the surface rights necessary for our
operations; whether Pan American is able to maintain a strong
financial condition and have sufficient capital, or have access to
capital through our corporate sustainability-linked credit facility
or otherwise, to sustain our business and operations; and our
ability to comply with environmental, health and safety laws. The
foregoing list of assumptions is not exhaustive.
Pan American cautions the reader that forward-looking statements
and information involve known and unknown risks, uncertainties and
other factors that may cause actual results and developments to
differ materially from those expressed or implied by such
forward-looking statements or information contained in this news
release and Pan American has made assumptions and estimates based
on or related to many of these factors. Such factors include,
without limitation: the duration and effect of local and world-wide
inflationary pressures and the potential for economic recessions;
fluctuations in silver, gold and base metal prices; fluctuations in
prices for energy inputs, labour, materials, supplies and services
(including transportation); fluctuations in currency markets (such
as the PEN, MXN, ARS, BOB, GTQ, CAD, CLP and BRL versus the USD);
the duration and effects of COVID-19, and any other pandemics on
our operations and workforce, and the effects on global economies
and society; operational risks and hazards inherent with the
business of mining (including environmental accidents and hazards,
industrial accidents, equipment breakdown, unusual or unexpected
geological or structural formations, cave-ins, flooding and severe
weather); risks relating to the credit worthiness or financial
condition of suppliers, refiners and other parties with whom Pan
American does business; inadequate insurance, or inability to
obtain insurance, to cover these risks and hazards; employee
relations; relationships with, and claims by, local communities and
indigenous populations; our ability to obtain all necessary
permits, licenses and regulatory approvals in a timely manner;
changes in laws, regulations and government practices in the
jurisdictions where we operate, including environmental, export and
import laws and regulations; changes in national and local
government, legislation, taxation, controls or regulations and
political, legal or economic developments in Canada, the United
States, Mexico, Peru, Argentina, Bolivia, Guatemala, Chile, Brazil
or other countries where Pan American may carry on business,
including legal restrictions relating to mining, including in
Chubut, Argentina, risks relating to expropriation and risks
relating to the constitutional court-mandated ILO 169 consultation
process in Guatemala; diminishing quantities or grades of mineral
reserves as properties are mined; increased competition in the
mining industry for equipment and qualified personnel; those
factors identified under the caption "Risks Related to Pan
American's Business" in Pan American's most recent form 40-F and
Annual Information Form filed with the United States Securities and
Exchange Commission and Canadian provincial securities regulatory
authorities, respectively; and those factors identified under the
caption "Risks of the Business" in Yamana's most recent form 40-F
and Annual Information Form filed with the United States Securities
and Exchange Commission and Canadian provincial securities
regulatory authorities, respectively. Although Pan American has
attempted to identify important factors that could cause actual
results to differ materially, there may be other factors that cause
results not to be as anticipated, estimated, described or intended.
Investors are cautioned against undue reliance on forward-looking
statements or information. Forward-looking statements and
information are designed to help readers understand management's
current views of our near- and longer term prospects and may not be
appropriate for other purposes. Pan American does not intend, nor
does it assume any obligation to update or revise forward-looking
statements or information, whether as a result of new information,
changes in assumptions, future events or otherwise, except to the
extent required by applicable law.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230731543821/en/
For more information: Siren Fisekci VP, Investor Relations &
Corporate Communications Ph: 604-806-3191 Email:
ir@panamericansilver.com
Pan American Silver (NYSE:PAAS)
Gráfica de Acción Histórica
De Nov 2024 a Dic 2024
Pan American Silver (NYSE:PAAS)
Gráfica de Acción Histórica
De Dic 2023 a Dic 2024
