McEwen Copper has officially named Societe Generale as the sole financial advisor for the project debt financing of its Los Azules copper project in Argentina, putting a name to the international institution that had been the subject of speculation earlier in the week.
The mandate tasks the French bank with structuring and arranging a senior debt package to fund construction at one of the world’s largest undeveloped copper deposits. Societe Generale’s scope covers the full lift, from shaping the financing strategy and coordinating lender due diligence to assembling the information package and supporting negotiations.
The debt itself is expected to be pieced together from a mix of export credit agency facilities, commercial bank debt, multilateral and development finance institution lending, and a potential project bond. It’s a familiar template for large scale resource projects in emerging markets, where blending official sector capital with commercial paper tends to lower the all in cost of borrowing.
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“Bringing Societe Generale on board marks a significant step in advancing Los Azules toward construction,” said Michael Meding, Managing Director of McEwen Copper, who pointed to the bank’s project finance platform and its relationships across the export credit agency, multilateral, and commercial banking world.
READ: McEwen Copper Targets $4 Billion Financing for Massive Los Azules Copper Mine
McEwen Copper did not put a dollar figure on the debt package in Thursday’s announcement. However, comments from Meding earlier in the week, reported by Reuters, pegged the company’s overall capital need at roughly $4 billion and outlined a 40-60 equity-to-debt split. That math implies a debt tranche of around $2.4 billion and an equity raise of about $1.6 billion, the latter to be sourced from a mix of strategic investors and a planned initial public offering.
Discussions on the equity side are reportedly ongoing with Rio Tinto, parent McEwen Mining, and a range of industrial groups in North America, Europe, and Asia. Rio Tinto already owns a 17.2% stake in Los Azules through its copper-leaching subsidiary Nuton, which has contributed $100 million to date.
First production at Los Azules is currently slated for 2030, with the feasibility study modelling average output of more than 200,000 tonnes of copper cathode annually over the project’s first five years. Locking in a lead debt arranger is one of the larger boxes to tick before that timeline starts to firm up.
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