XSTRATA wins the bid for the concession of the Las Bambas mining project

On August 31st, the Swiss company XSTRATA won the bid for the concession of the Las Bambas mining project, having offered a total of US $ 121 million, that is, more than three times the base price.

Ferrero, Lema , Solari & Asociados (former Ferrero Diez Canseco & Asociados) acted as the local counsel for the operation under the command of Jacques D‘Auriol, Pablo Solari, Armando Lema and Felipe Boisset, while it was internationally supported by Sullivan & Cromwell, being Stewart Robertson the leading lawyer on the transaction, and Juan Donicelli, and Neil O‘Connor as in-house lawyers for XSTRATA.

XSTRATA‘S bid was higher than the bid made by four leading world mining companies such as BHP Billiton, CVRD and Phelps Dodge. The amount paid by XSTRATA includes the right that the company will have to exercise its exploitation option, once the exploration stage is over. As a result of the concession granted, the grantee will hand over, on the date the contract is signed, the amount of US $ 45 million as an initial social contribution, the same which will be managed by a trust whose objective is the sustainable development of the region. The contract to be signed with XSTRATA for the concession of Las Bambas, contemplates the highest royalty ever agreed with the Law in force, given the fact that it stipulates a 3% flat percentage of the sales. According to the government agency PROINVERSION, Las Bambas will increase mineral exports by 30%, as much as an yearly increase of 15 in the GDP, with what Peru would reach an annual production of 1M tons of copper.