REG - Antofagasta PLC - ANTOFAGASTA AGREES IN PRINCIPLE TO EXIT REKO DIQ

AntofagastaAnnouncement

21/03/2022 07:00

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RNS Number : 3616F  Antofagasta PLC  21 March 2022

 

 

NEWS RELEASE, 20 MARCH 2022

 

 

ANTOFAGASTA AGREES IN PRINCIPLE TO EXIT REKO DIQ PROJECT IN PAKISTAN

 

Antofagasta plc (the "Company"), Barrick Gold Corporation ("Barrick") and the
Governments of Pakistan and Balochistan have today reached agreement in
principle on a framework that provides for the reconstitution of the Reko Diq
project ("Project"), and a pathway for the Company to exit the Project.

 

The Project was suspended in 2011 due to a dispute over the legality of its
licensing process.  Antofagasta has decided not to participate in the
reconstituted project as the Company's growth strategy is focused on the
production of copper and by-products in the Americas (particularly Chile,
Peru, the USA and Canada) and the Reko Diq project does not support this
strategy.

 

The parties have agreed to work together over the course of this year to
finalise and approve definitive agreements.  If definitive agreements are
executed and the conditions to closing are satisfied:

·    the project will be reconstituted under Tethyan Copper Company Pty
Limited ("TCC"), a joint venture held equally by the Company and Barrick, and
TCC's International Centre for the Settlement of Investment Disputes ("ICSID")
award will be resolved;

·    a consortium comprising various Pakistani state-owned enterprises
will acquire shares in TCC's subsidiary which will hold the Project for
consideration of approximately US$900 million; and

·    proceeds will be distributed to Antofagasta in return for its exit
from the TCC holding structure.

 

If the conditions to closing are satisfied during 2022, the Company would
expect to receive those proceeds during 2023.

 

The Company notes that, although this agreement in principle is an important
step towards its exit from the Reko Diq project and the resolution of the
ICSID litigation announced in July 2019, there can be no certainty that
definitive agreements will be finalised or approved, or that the conditions to
closing will be satisfied.

 

 

 Investors - London                                                                     Media - London

 Andrew Lindsay        alindsay@antofagasta.co.uk (mailto:alindsay@antofagasta.co.uk)   Carole Cable      antofagasta@brunswickgroup.com (mailto:antofagasta@brunswickgroup.com)
 Telephone             +44 20 7808 0983                                                 Telephone         +44 20 7404 5959
 Rosario Orchard       rorchard@antofagasta.co.uk (mailto:avergara@antofagasta.co.uk)
 Telephone             +44 20 7808 0988
 Investors - Santiago                                                                   Media - Santiago

 Rene Aguilar          raguilar@aminerals.cl (mailto:raguilar@aminerals.cl)             Pablo Orozco      porozco@aminerals.cl (mailto:porozco@aminerals.cl)
 Telephone             +56 2 2798 7000                                                  Carolina Pica     cpica@aminerals.cl (mailto:cpica@aminerals.cl)
                                                                                        Telephone         +56 2 2798 7000

 

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