Panama, South Korea, copper, mystery and disclosure

Yesterday in IKN61, we ran this below as one part of the 'Regional Politics' section of the letter. Now, I fully expected Inmet Mining (IMN.to) to make an announcement on this today, as an LOI of the multibillion dollar magnitude would need immediate disclosure if true, but here we are long after the bell and not a peep from IMN about this deal.

So is it a deal, or has the ADN news agency been making things up?

Panama: South Korea sends in the big guns and gets results

In Central America, SICA is an important working group of countries. SICA stands for the ‘Central American Integration System’ and the organization comprising of Belize, Costa Rica, El Salvador, Guatemala, Nicaragua, Panama, with The Dominican Republic as an associate member, along with Honduras that was suspended from membership due to the 2009 coup but has been allowed to rejoin as a full member after this meeting.

Last week it was Panama’s turn to host the SICA summit meeting and one of the guests of honour at the conference was South Korea’s President, Lee Myung-bak. He wasn’t there just for protocol photo shoots either, as his country is very keen on participating in the development of large-scale mining in Panama, particularly in the rich copper deposits the country has to offer.

Already he has seemingly met with success on his trip. Spain’s ADN newswire reports (6) that South Korea’s Eximbank, heading up a consortium of financiers, has this weekend signed a Letter of Intent (LOI) with Inmet Mining (IMN.to) to develop its ‘Panama Copper’ project in said country in conjunction with Korea Resources, LS-Nikko Copper and Korea Export Insurance (KEIC). The South Koreans will provide all or part of the financing necessary (details on that are not out yet) and will also have an option to acquire 20% of the project directly.

Inmet’s ‘Panama Copper’ is a very big asset, with resources that allow plans for 51,000 metric tonnes of copper per year over a 30 year mine life. According to the LOI agreement production would be slated to begin in 2015. Meanwhile, it’s already known that South Korea is also interested in Panama’s other big untapped copper deposit called Cerro Colorado.

Mining Executives and The Art of Translation

Here's what they say (from yesterday's Mining Journal)

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Inmet Mining will seek a strategic partner for its Petaquilla copper project in Panama, the Canadian miner's chief executive said on Wednesday.

Inmet took full control of the C$3.5 billion ($2.8 billion) project late last year after buying out the 26% stake held by Petaquilla Copper, and taking over the 26% stake abandoned by Teck Cominco as part of a cost-cutting move.

"It's very early days, but we recognise the fact that a project of this size would benefit from a strategic partner," Inmet chief executive, Richard Ross, said. "So, over the course of the next year or so, we're going to start to evaluate what our options are with respect to that."

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And now here's what it means, put through the special BizEnglish-RealEnglish version of Ottotrans™:

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Inmet Mining will beg for a strategic partner for its Petaquilla copper project in Panama, the Canadian miner's chief executive said on Wednesday.

Inmet got suckered into the C$3.5 billion ($2.8 billion) project right at the top of the market and just before spot copper did its swandive after paying multiples too much for the 26% stake held by Petaquilla Copper, and taking over the 26% stake abandoned by Teck Cominco because Teck knows when to cut its losses and throw its dogs aways.

"It's very early days, but we recognise the fact that we've made a right balls-up and a project of this size is way too much for us to do alone," Inmet chief executive, Richard Ross, didn't say. "So, over the course of the next five years we're going to stall and stall, not move forward in any way and pray to the market gods that either copper goes back over $3/lb or some other sucker takes it off our hands."