Canada’s Taseko Mines (TSX: TKO) (NYSE: TGB) confirmed on Friday it is engaged in negotiations with Sojitz Corp regarding a potential deal to increase its stake in its Gibraltar copper mine in British Columbia.
The company said confidential discussions have focused on the potential acquisition of Sojitz’s 12.5% interest in the vast mine, which the Japanese firm acquired in 2010.
Taseko owns 75% cent of the joint venture that operates Gibraltar, while Cariboo Copper Corp. has the other 25%. Sojitz Corp. owns half of Cariboo.
The Vancouver-based miner said the prospective agreement contemplates a modest upfront payment upon closing and additional annual payments over a five-year period, dependent on Gibraltar’s copper revenues.
Definitive agreements haven’t been finalized and a transaction remains subject to various board, regulatory and other approvals, Taseko said.
Sojitz said on Thursdays the main reasons for considering selling its interest in the British Columbia-based mine, were unstable operations, declining grades and increased risk of environmental liabilities.
Taseko’s other Japanese partners, Furukawa and DOWA Holdings, which hold 6.25% stake each in Gibraltar, separately said they had made no decisions on the future of their stakes.
The Canadian copper mine churned out last year 97 million pounds of copper, down 14% from the 112.3 million pounds it mined in 2021.
Production in December was impacted by unplanned mill downtime, including a site-wide power outage late in the month.