The Japan Bank for International Cooperation signed today a loan agreement totaling USD390 million (JBIC portion) with Mitsubishi Corporation (MC). The loan is cofinanced with private financial institutions. This loan is intended to finance MC's acquisition in 2012 of the 18.1 percent interest in Anglo American Quellaveco S.A. (AAQ) in Peru then held by the International Finance Corporation (IFC). AAQ was formerly jointly owned by Anglo American plc, the British mining major, and the IFC. Through this acquisition of shares, MC obtained interests in the Quellaveco Copper Project in Peru owned by AAQ, and plans to take delivery of future copper concentrate produced by AAQ in proportion to its share ownership for supplies to domestic refineries as well as other buyers. Copper is used extensively for various products, including electric cables, electrical and electronic equipment, transport vehicles and construction materials. Thus, it is an indispensable metal for Japanese industry. Its demand is expected to rise globally with growing demand in infrastructure among emerging economies, especially in China and India, and with increasing sales of hybrid and electric vehicles*1. Since Japan relies solely on imports for copper concentrate, raw material for copper ingot, from Chile and other countries, it is an urgent challenge to secure a long-term, stable supply of copper resources through the acquisition of equity interests in copper mining firms by Japanese companies. As Japan's policy-based financial institution, JBIC will continue to actively support the development and interest acquisition of important resources such as minerals by Japanese companies, by drawing on its various financial facilities and schemes for structuring projects, and performing its risk-assuming function.
*1 It is said that hybrid and electric vehicles need copper 2 - 3 times more than in comparison with the same type of conventional engine vehicles.