Mercuria Inks Major Chile Copper Deal, Fueling Energy Transition Push

GENEVA and SANTIAGO, Chile – December 29, 2025 – Global commodity trading powerhouse Mercuria Energy Trading has executed a landmark deal in Chile's mining sector, securing a significant future supply of copper and gold while cementing its role as a key financier in the race for critical minerals. The Geneva-based group announced a long-term offtake agreement with El Espino SpA, a subsidiary of Chilean miner Sociedad Punta del Cobre (Pucobre), for its developing El Espino project.

The agreement gives Mercuria the right to purchase up to 100% of the copper and gold concentrates produced during the initial years of the mine's operation, which is slated to commence in 2027. Paired with the offtake rights is a substantial financial commitment: a facility of up to US$375 million. This capital is designated to refinance the project's existing debt, providing Pucobre with enhanced financial stability as it moves toward production.

This multi-faceted deal highlights a strategic pivot by the world's largest commodity traders, who are moving beyond their traditional roles to become integral financing and development partners for the mines that will supply the global energy transition.

A Strategic Play for Critical Metals

For Mercuria, a group with annual revenues exceeding $140 billion, the El Espino agreement is a calculated move in its aggressive expansion into metals. The company has publicly stated its ambition to grow its metals division to rival the scale of its formidable oil trading operations, with a strategic focus on acquiring assets and offtakes for minerals essential to decarbonization, such as copper, lithium, and cobalt.

"We are proud to support Pucobre and the El Espino project, which aligns perfectly with Mercuria's strategy to grow our metals business and deepen our footprint in Chile," said Kostas Bintas, Global Head of Metals and Minerals at Mercuria. "This agreement underscores our commitment to long-term partnerships and to providing innovative financial solutions that enable sustainable resource development."

The timing of the deal is critical. It comes amidst a widely bullish long-term outlook for copper, often called "the metal of electrification." Forecasts from institutions like S&P Global project that demand for copper could nearly double by 2035, driven by the explosive growth of electric vehicles, renewable energy infrastructure, and grid upgrades. With new mine development notoriously slow and existing ore grades declining, analysts predict a widening supply deficit in the coming years. Some banking forecasts, such as those from Bank of America, project copper prices could surge past $13,000 per tonne by 2027, making guaranteed supply a paramount strategic advantage.

This Chilean venture is the latest in a series of moves by Mercuria to secure its copper supply chain. It follows recent partnerships to access Zambian copper, a renewed deal for supply from the Democratic Republic of Congo, and strategic investments in other mining ventures through its affiliate TechMet.

Beyond Trading: Reshaping Project Finance

The structure of the El Espino agreement, combining a purchase guarantee with project financing, exemplifies a powerful trend in the resources sector. Commodity traders are increasingly leveraging their deep pockets and market insight to supplant or complement traditional bank lending for capital-intensive mining projects.

Mercuria's US$375 million facility is not entirely new capital for the project but will be used to refinance a senior-secured project finance loan of the same amount that El Espino secured in February 2025. That earlier facility, arranged by Natixis Corporate & Investment Banking, was instrumental in getting the approximately US$700 million project fully funded for construction. By stepping in to refinance this debt, Mercuria solidifies its position as the project's central commercial and financial partner, intertwining its success with the mine's output.

For Pucobre, this integrated model is a significant de-risking event. It provides a guaranteed buyer for its product at the outset of operations, mitigating market price volatility, and offers a stable, long-term financial backbone.

Sebastián Ríos, CEO of Pucobre, highlighted the deal's importance. "This agreement represents a significant milestone for El Espino and for Pucobre," he stated. "Partnering with Mercuria as a reliable and long-term offtaker, together with the availability of a financing solution, allows El Espino to strengthen the project's positioning as it moves toward production and reinforces our long-term growth strategy in Chile."

A Vote of Confidence in Chile's Mining Future

The substantial, long-term commitment from a global giant like Mercuria is also being interpreted as a strong vote of confidence in Chile's investment climate and its enduring dominance in the copper world. The El Espino project, located in the country's Coquimbo Region, is a joint venture between Pucobre, which holds a 76.3% stake, and the private equity group Resource Capital Funds (RCF), which holds the remaining 23.7%.

Once operational, the mid-sized open-pit mine is expected to produce approximately 100,000 tons of copper and gold concentrates annually. This translates to an average output of 26,000 tons of copper and 13,000 ounces of gold per year over its projected 18-year mine life. The project is already a source of local economic activity, with construction advancing and major equipment, including mills and flotation cells, being supplied by the Finnish company Metso.

Pucobre itself has demonstrated strong operational and financial health leading up to this deal. In recent financial reporting, the company nearly doubled its EBITDA, driven by higher sales volumes and improved ore grades that significantly lowered its cash production costs. This operational efficiency makes it an attractive partner for an offtaker like Mercuria, which is seeking reliable, low-cost sources of supply.

The deal locks in a vital stream of future metals for Mercuria as it navigates a market defined by scarcity and rising geopolitical competition for resources. Simultaneously, it provides the financial certainty and market access for Pucobre to bring a major new Chilean asset online, ensuring its output will help power the next generation of green technology.