Canadian mining company First Quantum Minerals recently held discussions with Chinese government officials to explore funding opportunities and business collaborations involving major investor Jiangxi Copper Co. The talks in Jiangxi province revolved around potential investments by state-run Jiangxi Copper, including the possibility of influencing board decisions at First Quantum. Additionally, discussions encompassed the future of First Quantum’s Zambian assets and the potential acquisition of disputed copper concentrates inventory from Panama by Jiangxi.
Despite Jiangxi’s significant investments in First Quantum since November, which amount to approximately $745 million, the Chinese entity currently lacks decision-making authority on the board due to a standstill agreement limiting its equity stake to 20%. Amidst speculation about further investments post-meeting, First Quantum and Jiangxi Copper refrained from providing official comments on the matter. The relationship between the two entities has seen fluctuations since 2019, with Jiangxi initially viewed as a potential hostile takeover threat but evolving into a supportive partner during recent operational challenges faced by First Quantum.
The closure of the Cobre Panama mine, representing a substantial portion of First Quantum’s revenue, following local protests has prompted strategic measures by the company, including equity offerings and a copper pre-payment agreement with Jiangxi. As negotiations continue with the Panama government to resolve the mine dispute, discussions have also emerged regarding potential stake acquisitions in First Quantum’s Kansanshi mine in Zambia. With Jiangxi Copper playing a significant role in China’s copper production landscape, its engagement with First Quantum holds implications for the global copper market and strategic partnerships within the mining industry.