King & Wood Mallesons (KWM) has advised Glencore plc on the establishment of a long-term economic agreement with Evolution Mining Limited in relation to delivery of gold and copper production at the Ernest Henry Mine (EHM) in Queensland.

Under the deal, Evolution Mining will pay A$880m to Glencore for a 30 per cent economic stake in the EHM operation and will be entitled to 100 per cent of the mine’s gold, and 30 per cent of its copper and silver production subject to an agreed life of mine and block model. Glencore will purchase the copper and silver payable delivered to Evolution for cash at market value.

Evolution will also commit to ongoing monthly cash contributions equal to 30 per cent of production and capital costs associated with copper concentrates. 

Glencore will continue to own 100% of the world-class copper-gold-silver mining operation and will continue to manage the day to operations at EHM.

KWM developed all aspects of the complex transaction structure. The team was led by Partner Nicholas Pappas with support from Senior Associates Kate Lindner and Anthony Boogert. Partner Tim Sherman provided tax advice.

“We are pleased to have supported long-term client Glencore on designing this unique agreement.” said Pappas.