McEwen (TSX:MUX) subsidiary McEwen Copper has closed a US$240 million ($333.6 million) senior secured four-year term loan to advance the Los Azules Copper Project in Argentina towards a final investment decision (FID).
The loan facility was provided by a syndicate of lenders, with Sprott Natural Resource Investment Partners contributing US$112 million, Chairman Rob McEwen providing US$85 million, and other lenders contributing US$43 million.
Proceeds will fund continued engineering and early works at Los Azules in San Juan, Argentina, and general corporate purposes. McEwen expects an FID and full project financing in mid-2027 and is targeting commercial copper cathode production for 2030, subject to project financing and customary approvals.
Under the terms, the loan bears interest at 12% per annum, payable monthly, with principal due at maturity. Early repayment requires paying the remaining principal and accrued interest plus a 5% fee.
Lenders received 15,000 five-year McEwen Copper common share purchase warrants per US$1 million of principal at an exercise price of US$40 per share.
Managing Director Michael Meding says this financing reflects lenders’ confidence in Los Azules and in the progress Argentina has made over the past 2.5 years.
“The initiatives of President Javier Milei have helped make Argentina an increasingly attractive destination for large-scale foreign investment,” Meding notes.
The financing provides funding while McEwen Copper advances broader project debt financing for Los Azules, for which Societe Generale was appointed sole financial advisor in May 2026.
Preparations for a potential initial public offering of McEwen Copper also continue in parallel.
McEwen says engineering for the FID is ahead of plan, with key process equipment packages awarded to Metso, a mining fleet tender under final evaluation, and EPCM (engineering, procurement, and construction management) contractor selection expected by Q4 2026.
The company owns a 46.3% interest in McEwen Copper and holds a 1.25% net smelter return royalty on Los Azules, projected to generate approximately US$1.4 billion in combined undiscounted pre-tax royalty cash flow.
McEwen is a gold and silver producer with exploration and development assets across Argentina, the US, Canada, and Mexico.
Write to Paula Fabe at Mining.com.au
Images: McEwen
