Morocco: Aterian seeks joint-venture partner to exploit copper holdings

By David Whitehouse
Posted on Wednesday, 9 November 2022 16:07

Aterian's Agdz exploration area in Morocco. Photo supplied.

London-listed Aterian is seeking a joint-venture partner to help it develop a range of copper assets in Morocco, chairman Charles Bray tells The Africa Report.

The company’s biggest project at Agdz in the Anti-Atlas mountains is “large enough to get the attention of the majors,” and contacts with potential partners are already taking place, he says.

The company is preparing a drilling programme at Agdz. Bray estimates that copper production in Morocco is probably about five to seven years away, and says the scale of the assets means that a partner will be needed to develop them.

The company, formerly known as Eastinco Mining and Exploration, was admitted to the main market of the London Stock Exchange in October.

Metal projects

At the same time as its listing, Aterian completed the purchase of a portfolio of 15 Moroccan copper-silver and base metal projects spread over an area of 762 km2 from Elemental Altus Royalties, which trades on Canada’s TSX Venture Exchange.

Elemental Altus is now the company’s largest shareholder with a 25% stake, and has appointed a representative to the board.

Mining accounts for 35% of Morocco’s foreign trade and 6% of its GDP. But, Bray says, the country’s potential as a copper producer remains underexplored, partly due to the ease with which copper has been mined in Latin America.

That neglect will be hard to sustain as the world faces the prospect of a long-term copper shortage.

Copper is needed for electric vehicles, wind and solar power, as well as for traditional uses in construction, infrastructure, machinery and transport. S&P Global has forecast that copper demand may nearly double by 2035.

Energy transition targets

John Mothersole, director of nonferrous metals economics & country risk for Market Intelligence, says meeting energy transition targets would mean the amount of copper used between now and 2050 would exceed the world’s entire cumulative copper consumption since 1900.

  • Aterian, which this week appointed Luke Rogers as the chief operating officer, at the start of November reported that high-grade copper and silver had been discovered at Azrar, another of its Moroccan projects.
  • Azrar is close to the existing road, rail and power infrastructure, while Agdz is in the “tens of kilometres” of distance from a power source, Bray says.

Metals Trading

In Rwanda, the company has a stake in three projects which have tantalum, niobium and tin resources. Tantalum and niobium are used in the production of electric vehicles and mobile devices, while tin is needed for lithium-ion batteries.

The company is hoping to fund the development of its Moroccan projects through metals trading in Rwanda. Talks with potential off-takers for the Rwandan minerals have already been taking place.

It’s “not unrealistic” that the trading could avoid the need to raise funding for exploration, says Bray, who will be in Rwanda next week to meet regulators. Still, currently, favourable margins on metals trading may not last forever, he says, and he’s not ruling out needing to raise equity capital in the future.

Though it has the right to trade tin in Rwanda straight away, Aterian is waiting until it joins the International Tin Supply Chain Initiative (ITSCI) before starting. Bray hopes to secure ITSCI membership by the end of this year and to start trading early in 2023.

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