Latham Advises on Major Acquisition, Construction, and Project Financing of Dual Seawater Impulsion Systems for the Minera Centinela and Minera Antucoya Mining Operations in Chile

This landmark transaction is part of Minera Centinela’s recent US$4.4 billion mine site expansion and seeks to provide the existing and additional seawater required for mining operations once the expansion is completed. Minera Centinela and Minera Antucoya are subsidiaries of Antofagasta Minerals and Marubeni.

Latham’s multi-disciplinary team advised on the:

1. acquisition from Minera Centinela and Minera Antucoya, and the refurbishment, operation, and maintenance, of a fully operational 144-kilometer seawater impulsion system;
2. engineering, procurement, construction, operation, and maintenance of a new seawater impulsion system, to be constructed parallel to existing pipeline;
3. offtake arrangements for the supply of seawater to the mine sites; and
4. approximately US$1.35 billion multi-source project financing, which is subject to the green loan and green bond principles and includes:
   1. senior term loan facility provided by Banco Santander, BBVA, CA-CIB, Intesa, KfW, and Natixis;
   2. senior letter of credit facility provided by Banco Santander, BBVA, CA-CIB, Intesa, KfW, and Natixis;
   3. senior US private placement facility provided by accounts managed by Allianz, Carlyle, Denham Capital, and Hanwha;
   4. currency and interest rate hedges for the senior facilities provided by Banco Santander, CA-CIB, Intesa, KfW, and Natixis;
   5. subordinated equity bridge loan facility provided by Scotiabank;
   6. an interest rate hedge for the equity bridge loan facility provided by Scotiabank; and
   7. subordinated performance bond facility provided by Banco Santander.

The transaction required some innovative financing techniques to address project-on-project risk and ensure that the seawater impulsion system financing and the mine expansion financing interface appropriately.

The Latham cross-practice team was led by partner Guido Liniado, with associates Francisco Lascurain and Andres Chester,* and with assistance from Jaime Salinas Muller** and Yasmin Tayar.*** Partner Christopher Peponis advised on EPC and O&M arrangements, with associate Andrew Evans. Partner Carlos Alvarez advised on derivatives matters, with associate Jackie Rugart. Partner Elena Romanova advised on tax matters. Partner Matthew Salerno and counsel Andrew Galdes advised on sanctions, anti-corruption, and anti-money laundering matters. Counsel Aryeh Zuber advised on ERISA matters. Counsel Joel Cavanaugh advised on investment company matters. Associate Austin Pierce advised on environmental and social matters.

*Not admitted to practice in New York. Admitted in Argentina.

** Admitted to practice in Chile only.

***Admitted to practice in Brazil only.