Cobre Limited (CBE.AX) Third-Party Ore to Boost Copper Output and Cash Flow

Sydney, Sep 9, 2026 AEST (ABN Newswire) - Cobre Limited (ASX:CBE) announced that its wholly owned subsidiary, Sierra Atacama SpA, has executed ore purchase agreements with two third-party copper oxide miners in the Antofagasta region. As the deliveries ramp up from Q4 2026, they are expected to deliver 50-75 kt per month of 1.0-1.5% CuT ore to the Sierra Atacama SX-EW plant, adding c300t of monthly copper cathode production. This production is additional to the Company's previously announced production targets (6 July 2026), which remain unchanged.

HIGHLIGHTS

- Two supply agreements executed with regional copper oxide mines in the Antofagasta region, with further agreements under negotiation and expected in the near term, further lifting SX-EW utilisation and cash flow.

- As the contracts ramp up from Q4 2026, we expect them to deliver 50-75 kt per month of 1.0-1.5% CuT oxide ore, well above the current underground head grade and expected to add approximately 300t of copper cathode per month. Sierra Atacama SX-EW plant to run at materially higher utilisation from Q4 2026, delivering stepchange growth in cathode production and operating cash flow. The incremental cathode carries no mining or development cost and uses existing, under-utilised SX-EW capacity with fixed plant costs spread over a larger tonnage base lower unit cost across the operation.

- Consolidates Sierra Atacama's position as the natural processing hub for high-grade oxide ore in the Antofagasta region.

- Bridges seamlessly into the 2027 production growth phase, when the current underground operation transitions to open-pit, whilst substantially improving unit economics for own-ore processing.

- Incremental to guidance: underground production continues to be stabilised to the 400-500t/m target announced in July 2026. No change to any previously provided production estimates or guidance.

A regional copper processing hub

The Sierra Atacama SX-EW plant sits in the heart of Chile's Antofagasta copper region, surrounded by small-to-midscale copper oxide mines that lack direct access to their own processing capacity. By providing a reliable, well-located and competitively-priced offtake route, Sierra Atacama has become the natural counterparty for these operators. Regional mines benefit from shorter haul distances, faster payment terms and a long-term commercial partnership; Cobre benefits from securing high-grade feed that lifts overall plant grade and utilisation. It is a mutually reinforcing structure that positions Sierra Atacama as the processing hub of the region.

The agreements

Sierra Atacama SpA has executed ore purchase agreements with two copper oxide mines located within trucking distance of the Sierra Atacama plant. These operators have high-grade oxide ore but no processing capacity of their own; Sierra Atacama has 20,000 tonnes per annum of installed SX-EW cathode capacity and is operating below nameplate.

Under the agreements, ore is delivered to the plant, with the purchase price referenced to contained copper and the prevailing copper price. Deliveries are scheduled to ramp-up in Q4 2026.

Step change in near-term margin and cash flow

Purchased ore bypasses the mining and development cost that sits behind every tonne of underground production, and is processed through crushing, leach and SX-EW capacity that is already built, staffed and largely fixed in cost. The incremental cost of the additional cathode is therefore limited to the ore purchase price and variable processing costs, principally acid, power and reagents. Higher throughput also spreads fixed plant costs across a materially larger tonnage base, lowering the unit cost of the Company's own underground production, providing further potential upside to cash generation.

Consolidating the transition to 2027 open-pit production

As outlined in the 6 July 2026 announcement, Cobre's production trajectory involves a progressive transition from the current underground operation to a substantially expanded open-pit operation from 2027. The third-party ore agreements consolidate this transition in three ways:

(1) Full plant utilisation - the SX-EW plant continues to operate at a materially higher throughput through the transition, spreading fixed costs across a higher tonnage base and improving unit economics for own-ore processing as the open-pit ramps up.

(2) Commercial infrastructure - the regional supply contracts establish the commercial, logistical and qualityassurance frameworks that scale as the Company's own production grows. When the open-pit reaches nameplate capacity, Cobre will have proven and tested systems in place.

(3) Metallurgical experience - processing a range of regional oxide ore sources through the SX-EW plant builds operational knowledge that strengthens plant performance and de-risks the ramp; the plant is being proven across the full range of feedstock that will characterise the 2027 operation.

The third-party ore does not form part of, and does not alter, the production targets provided to the market in July 2026. What this agreement does is achieve maximum theoretical production (20kt pa or c1,600t pm) on the existing operating much faster (see chart below). FY2027 guidance, incorporating the underground operation, the third-party ore contribution and the planned commencement of open-pit mining, will be provided in Q1 2027.

Further agreements expected

Negotiations with additional regional ore suppliers are well advanced and the Company expects to execute further agreements in the near term. Each additional source lifts SX-EW utilisation toward nameplate, adds to cash flow and further reduces unit costs. Sierra Atacama's processing capacity, location and payment terms position it as the processing hub for high-grade oxide ore in the district.

Management commentary

Cobre Chief Executive Officer Adam Wooldridge commented:

"We are approaching a defining period for Sierra Atacama. The current underground operation will progressively transition through 2027 into a substantially larger open-pit operation, and third-party ore fills that gap - keeping the SX-EW plant at materially higher utilisation throughout the transition rather than allowing throughput to drop between the two production sources. These agreements are the direct product of the operational credibility we have built with regional counterparties, and they demonstrate the strategic advantage of Sierra Atacama's location and processing capacity in the heart of Chile's premier copper region. Sierra Atacama is being positioned as the regional processing hub, and the market is now recognising that."

Cobre Chief Financial Officer, Kaveen Bachoo, added:

"Financially, these arrangements deliver on three fronts. They generate incremental cash flow through 2027 that would not otherwise be available during the transition period. They spread the plant's fixed cost base across a materially higher tonnage throughput, which improves unit economics for our own ore. And they establish the commercial framework - pricing, logistics, quality assurance - that scales seamlessly as our own production grows. These are not a substitute for our organic strategy; they accelerate it and provide meaningful optionality as Cobre moves into the 2027 growth phase."

*To view tables and figures included in this announcement, please visit:
https://abnnewswire.net/lnk/RF1INO59

About Cobre Limited

Cobre Limited (ASX:CBE) is a global copper company focused on high-margin production and tier-1 exploration across two of the world's premier mining jurisdictions: the Atacama region in Chile and the Kalahari Copper Belt (KCB) in Botswana. By combining an operating asset at the Sierra Atacama Mine with a dominant, belt-scale landholding in the KCB, Cobre offers a unique, de-risked investment case that spans the entire copper value chain—from near-term cathode production to world-class discovery potential. Cobre's strategic portfolio includes the newly acquired Sierra Atacama Mine in Chile, located in the heart of the world's most prolific copper-producing district, alongside a massive 5,348km2 landholding in Botswana.

   

Related Companies

Legal Disclaimer:

EIN Presswire provides this news content "as is" without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the author above.