A four-year senior secured facility bearing 12.0% annual interest has been closed by McEwen Copper Inc., with the proceeds earmarked for engineering and early works at the Los Azules copper, gold and silver project in San Juan, Argentina, the company said. The $240 million loan funds the asset through to a final investment decision expected in mid-2027.
Interest is payable monthly, with principal due at maturity after four years, according to the McEwen Inc. release dated Aug. 27. Lenders received 15,000 five-year McEwen Copper common share purchase warrants for each $1 million of principal, exercisable at $40 per share. The loan can be repaid early at remaining principal plus accrued interest and a 5% fee on the outstanding balance.
"This financing reflects our lenders' confidence in Los Azules and in the progress Argentina has made over the past two and a half years," Michael Meding, Managing Director of McEwen Copper, said. "Economic stabilization, stronger credit ratings, lower country risk and the RIGI are bringing long-term capital back to the country."
Sprott Natural Resource Investment Partners provided $112 million, Rob McEwen, Chairman and Chief Owner of McEwen Inc., contributed $85 million, and other lenders supplied $43 million. McEwen Inc. owns 46.3% of McEwen Copper, which is not publicly listed. Société Générale was appointed sole financial adviser in May 2026 for the broader project debt package, and preparations for a potential McEwen Copper initial public offering continue in parallel.
TNR's 0.4% royalty carries no capital obligation
TNR Gold Corp. (TSX-V: TNR, FRA: TNW, OTC: TRRXF) holds a 0.4% net smelter returns royalty on Los Azules, of which 0.04% is held on behalf of a shareholder. The royalty applies to metal production, and TNR states it is not required to contribute any capital to project development.
The structure gives TNR exposure to a project whose value has risen on three fronts since McEwen Copper's October 2024 financing: copper prices are 50% higher, a feasibility study was completed using a $4.35 per pound copper price, and Los Azules received approval under Argentina's Large Investment Regime, or RIGI. McEwen Inc.'s 46.3% interest carried an implied value of $456 million at that October 2024 financing.
McEwen Inc. separately holds a 1.25% NSR on Los Azules. Based on the 2025 feasibility study and a copper spot price of $6.50 per pound, that royalty is projected to generate approximately $584 million from the initial case and $860 million from the potential Nuton extension, for combined undiscounted pre-tax cash flow of about $1.4 billion. TNR's 0.4% stake is roughly a third of McEwen's royalty rate, giving a scale anchor for the smaller holder's eventual cash flow.
TNR's portfolio also includes a 1.5% NSR on the Mariana Lithium project in Argentina, where Ganfeng Lithium's subsidiary Litio Minera Argentina has the right to repurchase 1.0%, and a 7% net profits royalty on the Batidero I and II properties at the Josemaria project, held by a Lundin Mining and BHP joint venture. The company reports a 775% total shareholder return over five years, against 161% for the equal-weighted royalty peer group and 252% for the market-cap-weighted peer group.
5,600 metres drilled as engineering runs ahead of plan
The 2025-2026 field campaign at Los Azules was completed with more than 5,600 metres of drilling. Geotechnical results came in better than expected and will feed into open pit design, while condemnation drilling confirmed the planned location for the North-East rock storage facility. Engineering for the final investment decision is ahead of the company's internal plan.
Metso has been awarded the key process equipment packages covering the solvent extraction and electrowinning circuit, sulfuric acid facilities and crushing. The mining fleet tender is in final evaluation, and selection of the engineering, procurement and construction management contractor is expected in the fourth quarter of 2026. At peak, the past field season employed more than 500 people, nearly 90% hired from San Juan, and community surveys near the project show trust and acceptance levels above 90%.
Commercial copper cathode production is targeted for 2030, subject to securing project financing and customary approvals. The term loan does not constitute a final investment decision. McEwen Copper is also working with Rio Tinto's Venture Nuton on leaching technology intended to cut energy, water and capital use, which could extend the project's output profile beyond the initial case.
For TNR, the practical effect is that the funding overhang on its royalty asset has narrowed without any dilution or cash call on its side. The next hard checkpoint is the mid-2027 final investment decision, followed by the EPCM contractor award in the fourth quarter of 2026.
This article is for informational purposes only and does not constitute investment advice.
