Foran Mining lines up $200M for McIlvenna Bay copper project

Foran Mining (TSX.V: FOM; OTCQX: FMCXF) has inked a preliminary deal for a $200-million investment by the Ontario Teachers’ Pension Plan Board, for the company’s McIlvenna Bay copper project in Saskatchewan.

The agreement locks the parties into an exclusivity period deal, with the goal of signing a definitive agreement in the third quarter.

The proceeds of the proposed $180-million convertible secured instrument will be used for the development of the McIlvenna Bay project, and is contingent on Foran landing a senior secured facility, still in discussion. Another $20-million in investment is contingent on the company reaching a production of 90 million lb. copper-equivalent on a run-rate basis for a 60-day period.

An aerial view of Foran Mining’s McIlvenna Bay polymetallic project in Saskatchewan. Credit: Foran Mining 

The project is said to be the largest undeveloped volcanogenic massive sulphide (VMS) deposit along the prolific Flin Flon Greenstone Belt, which sprawls east-central Saskatchewan and central Manitoba.

According to a feasibility study released earlier this year, a 4,200-tonne-per-day development at McIlvenna Bay would cost $368 million. The projected mine life is 18 years mine life producing 65.4 million lb. of copper equivalent per year at an average all-in sustaining cost (net of credits) of US90¢ per pound. 

Foran is also trying to turn McIlvenna Bay into the world’s first carbon-neutral copper mine by offsetting carbon emissions generated in the exploration phase.

The Ontario Teachers’ Pension Plan, with more than $240 billion in net assets, has investments in natural resources and royalty interests in oil and gas.