Southern Hemisphere nabs Canadian heavyweight for Chile copper project

Junior copper explorer Southern Hemisphere Mining has nabbed itself some muscle to help bring its Llahuin project in Chile into production.

Major Canadian copper producer Hudbay Minerals has taken a liking to the project and wants to stump up $5.8 million in cash over five years for a 70 per cent stake.

The Llahuin project already has a defined resource and the main target is a porphyry zone. Porphyry — a crystal-like orebody formed from molten rock — is the world’s main source of copper.

“This is an exceptional deal for the company,” said Southern Hemisphere (ASX:SUH) chairman David Lenigas, who also chairs Pilbara gold explorer Artemis.

“To have a major copper producer of Hudbay’s global standing farm in to Llahuin is a big achievement for Southern Hemisphere Mining.”

The two companies have inked an option agreement that paves the way for Hudbay to spend at the very least $3.5 million on exploration in the first three years.

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Southern Hemisphere previously had the help of another Canadian producer — Lundin Mining, which pulled out of the partnership after spending over $7 million on exploration.

Improving global copper markets as a result of new demand generated by the energy storage and electric vehicle sectors prompted the company to step up its efforts to find a new partner.

The shares were unchanged on Thursday.