A Canadian mining company that plans to develop a huge open pit mine south of Tucson has sold nearly half the silver from the mine upfront to fund the project.
Augusta Resource Corp. plans to begin producing copper, molybdenum, silver and gold from the site by 2011. The project still needs environmental approvals and faces opposition from environmentalists, residents living near the site and the Pima County Board of Supervisors.
Augusta announced Wednesday that it had sold 45 percent of the silver production from the mine for a one-time upfront payment of $165 million from Silver Wheaton Corp., a publicly traded mining company exclusively focused on silver. Both companies are based in Vancouver.
Augusta would use the proceeds to develop the mine.
A statement issued by Wheaton said a definitive agreement is expected to be completed by July 1. The transaction is subject to Augusta receiving needed permits and arranging additional development financing.
The Rosemont mine is projected to produce a yearly average of 220 million pounds of copper, 4.5 million pounds of molybdenum, 2.7 million ounces of silver and 15,000 ounces of gold over the mine's 18-year production.
Rosemont Mining Co., an Augusta subsidiary, plans the mine on 995 acres it owns in the Santa Rita Mountains. The mine would spill over onto 3,670 acres of the Coronado National Forest, 15 acres managed by the federal Bureau of Land Management and 75 acres of Arizona State Trust land.
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