Copper Mountain Mining Corporation (TSX: CMMC) (ASX: C6C) is pleased to announce it has entered into a definitive agreement with Harmony Gold Mining Company Limited (JSE: HAR) (NYSE: HMY) to sell its wholly-owned Eva Copper Project and its 2,100km² exploration land package in Queensland, Australia for total consideration of up to US$230 million.

Under the terms of the Transaction, Copper Mountain will receive the following consideration:

1. US$170,000,000 in cash payable on closing of the Transaction;
2. Up to US$30,000,000 in cash, based on a contingent payment arrangement where Harmony will pay Copper Mountain 10% of the incremental revenue generated from the Eva Copper Project and the Australian exploration land package above the revenue assuming a US$3.80/lb copper price; and
3. Up to US$30,000,000 in cash, based on a contingent payment arrangement where Harmony will pay Copper Mountain US$0.03 per pound of contained copper for any SAMREC copper resource discovered and declared on a new deposit within the Eva Copper Project and the Australian exploration land package after the closing of the Transaction.

Gil Clausen, Copper Mountain’s President and CEO, stated, “We are pleased with this transaction as it demonstrates the value the Company has developed in the Eva Copper Project since our acquisition of Altona Mining Limited in 2018. It also recognizes the exploration upside that exists on the surrounding prospective land package.”  

Letitia Wong, Copper Mountain’s CFO, added, “This transaction strengthens our balance sheet and allows the Company to evaluate options with respect to our long-term capital structure. Further, as our recently announced Life of Mine plan demonstrates, the Copper Mountain Mine is expected to generate healthy free cash flow starting in 2023 and we expect mine operations and the 65,000 tonnes per day expansion to be self-funded going forward.” 

The closing of the Transaction is subject to certain customary conditions, including approval from the Foreign Investment Review Board (FIRB) in Australia and Copper Mountain bondholder approval. The Transaction has received approval from the South African Reserve Bank (SARB) and is not subject to any financing conditions. The Transaction is expected to close in the first quarter of 2023.

Advisors and Counsel

Macquarie Capital is acting as financial advisor to Copper Mountain. Davies Ward Phillips & Vineberg LLP and Corrs Chambers Westgarth are acting as Canadian and Australian legal counsel, respectively, to Copper Mountain.

About Copper Mountain Mining Corporation

Copper Mountain’s flagship asset is the 75% owned Copper Mountain Mine located in southern British Columbia near the town of Princeton. The Copper Mountain Mine currently produces approximately 100 million pounds of copper equivalent per year.  Copper Mountain also has the 100% owned development-stage Eva Copper Project and an extensive 2,100 km² highly prospective land package in in Queensland, Australia.