Project Finance for Centinela Copper Mine Expansion Project in Chile
Supporting Japan's Long-term and Stable Procurement of Copper Concentrate

• Region: Latin America and the Caribbean
• Energy and Natural Resources
• Overseas Investment Loans
• Project Finance

1. The Japan Bank for International Cooperation (JBIC, Governor: HAYASHI Nobumitsu) signed on March 16 a loan agreement for project finance^*1 totaling up to USD950 million (JBIC portion) with Chilean corporation Minera Centinela (Centinela) to finance expansion project of the Centinela copper mine. The loan is co-financed by Export Development Canada, Export-Import Bank of Korea, KfW IPEX-Bank, and several private financial institutions (Sumitomo Mitsui Banking Corporation, Crédit Agricole Corporate and Investment Bank, Société Générale S.A., and Natixis S.A.). The total co-financing amount is USD2,500 million.
     
2. Centinela, which is invested in by Antofagasta plc of the UK and Marubeni Corporation, plans to develop a new mining area at the Centinela copper mine located in Antofagasta, the second region of Chile, and then newly construct and operate concentrator plants and related facilities. Japanese companies will offtake part of the increased production of the copper concentrate from the expansion project.
     
3. In the current trend of decarbonization, demand for copper is expected to increase globally as an indispensable metal for electric vehicles as well as renewable energy facilities and equipment. Since Japan relies solely on imports for copper concentrates, it is an urgent challenge to secure a long-term, stable supply of copper resources. The Strategic Energy Plan, which was approved by the Cabinet in October 2021, set the goal of achieving at least 80% self-sufficiency by 2030 for base metals, including copper, and established the policies of strengthening support for Japanese refineries to reduce the procurement risk of ores and establishing resilient supply chains. The project is in line with the Japanese government's policies, as it will support the enhancement of the resilience of the entire copper product supply chain through the additional development of a copper mine in which Japanese companies hold interests and the securing of a long-term, stable supply of copper resources.
     
4. In addition, the Centinela copper mine is dedicated to sustainable copper production, with a strong emphasis on environmental stewardship. This includes utilizing only seawater for operational needs and sourcing 100% renewable energy for electrical power. Centinela was awarded the Copper Mark^*2 certification in July 2021. Marubeni has identified its green strategy as a pivotal policy in boosting corporate value, defining it as a core component of its Mid-Term Management Strategy, GC2024. Within this framework, Marubeni categorizes its copper and related businesses, which are essential to electrification, as a green business. The loan supports Marubeni’s initiative based on its green strategy, thereby assisting Japanese companies’ efforts for energy transformation toward the realization of a decarbonized society.
     
5. As Japan's policy-based financial institution, JBIC will contribute toward securing a stable mineral resource supply to Japan and addressing energy transformation for the realization of a decarbonized society by drawing on its various financial facilities and schemes for structuring projects and performing its risk-assuming function.
     

Note

1. *1 
   Project finance is a financing scheme in which repayments for a loan are made solely from the cash flow generated by the project.
2. *2 
   The Copper Mark, founded by the International Copper Association in 2019, is a framework that demonstrates the copper industry’s responsible production practices and contribution to the Sustainable Development Goals (SDGs). Copper producers seeking recognition need to meet 32 criteria regarding the SDGs, including the assessment of CO2 emissions.