Canadian miners Teck Resources and Agnico Eagle have closed the joint venture transaction to advance the development of the San Nicolas copper/zinc project in Mexico.
As per the deal, which was signed in September 2022, Agnico has subscribed for shares in Teck Resources’ fully-owned subsidiary Minas de San Nicolás (MSN), which owns the San Nicolás project.
Teck said in a statement: “For governance purposes, Agnico Eagle is deemed to be a 50% shareholder of MSN from closing, regardless of the number of shares that have been issued to Agnico Eagle or its subsidiary.”
In September 2022, Agnico also agreed to contribute 50% of the project’s initial estimated cost of $580m.
Located in Zacatecas, a major mining state in Mexico, the San Nicolás project holds significant geological potential and several poly-metallic and precious metals opportunities.
Based on current cost environment and estimate accuracy, Teck and Agnico Eagle expect the project to cost $1-$1.1bn for development.
Teck and Agnico Eagle own 50% stake each in the JV, which will submit an environmental impact assessment and permit application for San Nicolás project in the first half of this year.
The joint venture partners are planning to complete a feasibility study on the project in early 2024, with production scheduled to start in 2026.
With an estimated mine life of 15 years, the project holds the possibility of its operational life being extended, Teck earlier said.
The mine is expected to produce 63,000 tonnes per annum (tpa) of copper and 147,000tpa of zinc in concentrate during its first five years of operation.