(Ecofin Agency) - Multinational Lundin has decided to sell its 24% stake in Tenke Fungurume project, in DR Congo, to Chinese firm BHR Partners for $1.44 billion. The transaction is expected to close in the first half of 2017 and is subject to the regulatory approvals.

Under the terms of the deal, if copper price exceeds$3.5/Ib within the 24 months starting January 1, 2018, BHR will also have to pay Lundi a compensation of $25.7 million. However, if in the same period, cobalt’s price exceeds $20/Ib, the Chinese firm will pay an additional $25.7 million.

With this deal, Lundin has thus decided to renounce to its exclusive right to acquire 56% interest in Freeport McMoran, stake which the U.S. firm decided to sell on May 9, 2016, to Chinese company China Molybdenum for $2.65 billion. Lundin said at the time it would announce, latest by Nov. 15, 2016, if it would buy Freeport’s interest, at the same price proposed to China Molybdenum. Instead, the company decided to also exit the project.

“It was a difficult decision, respecting the 20 years of Lundin involvement in Tenke, and the special nature of this world class asset. The sale will enable Lundin to advance its strategy to incrementally grow the company with projects and operations  we control, while maintaining a strong balance sheet,”  said Paul Conibear, CEO of Lundin.

Lundin’s decision to exit the project is the new episode of a series which all eyes have been on for months now, and which seems to be coming to its end. While State-owned firm Gécamines asked international arbitration to contest the transaction between Freeport and China Molybdenum, recent announcements by the Congolese government are in favor of the sale.

Former Prime Minister, Augustin Matata Ponyo Mapon, following his counterpart from the Mining ministry, recently said he fully supported the sale indicating that “it is the best and safest solution for Congolese workers and their families”.

The Tenke Fungurume project is one the world’s largest copper and cobalt deposits, a group of adjacent permits covering an area of more than 1,500km² in Katanga.

Louis-Nino Kansoun