Elemental Royalty Corporation (NASDAQ: ELE) has noted the announcement by Quilla Resources Inc. on the successful production of first copper cathode from the Chapi Copper Project in southern Peru. Elemental holds a 2.0% Net Smelter Return royalty on the project.
Highlights
- First production of copper cathode at the Chapi Copper Project following Quilla’s acquisition in December 2024
- Ramp-up underway toward plant nameplate capacity of approximately 10,000 tonnes per annum of copper cathode
- Elemental expects first royalty payment from Chapi in Q1 2026
Chief Executive Officer and Director of Elemental Royalty, David M. Cole, commented: “Quilla has made phenomenal progress at Chapi with first copper cathode produced, and ramp-up underway toward nameplate capacity. This rapid progression through key de-risking milestones underscores the project’s meaningful value and significant upside potential.”
Details
Quilla has announced first production of copper cathode at Chapi following the acquisition of the brownfield asset in December 2024. Quilla undertook a comprehensive technical review, engineering evaluation, and operational planning before commencing refurbishment at the mine and solvent extraction and electrowinning (SX-EW) plant facilities. The restart was achieved within the originally stated schedule and budget, reflecting management’s strong execution, operational discipline, and reaffirming Elemental’s confidence in Quilla, and in-country subsidiary Minera Pampa de Cobre S.A.C., as operators.
Following the successful commissioning of the SX-EW the plant, Quilla have stated their intention to progressively increase operating rates toward an initial 10,000 tonnes of copper cathodes per year, while completing remaining capital projects and site optimization initiatives to support stable, long-term operations.
Elemental Royalty on Chapi
Acquired in January 2025, the royalty comprises a 2% NSR on minerals produced from the approximately 26,000-hectare property, as well as a 2% NSR royalty on any minerals produced from properties acquired by Quilla within a two-kilometer area of interest. In addition, the agreement includes an additional 2% NSR royalty from any minerals that are produced from outside the Property Royalty area, but that are processed at the Chapi Solvent Extraction Electro-Winning plant.
Background on the Chapi Mine
The Chapi Mine is located in southern Peru’s Moquegua and Arequipa Departments at an elevation of approximately 2,750 meters, and has ready access approximately 50 kilometers south-southeast from the city of Arequipa. Historical, small-scale copper production, which is poorly documented, occurred intermittently from the 1930s through the early 1980s. Subsequently, between 2006 and 2012 the Chapi Mine produced approximately 5,000 to 8,500 tonnes per annum, initially of copper sulphates from open-pit and underground mining and heap leaching, and later copper cathodes from open-pit mining, heap leaching, and SX-EW (solvent extraction-electrowinning) processing. The grades mined during 2006-2012 were reported as 0.59% – 1.04% copper. The operations were halted in 2012 due to declining copper prices and operational challenges that were mainly related to insufficient ore control on materials delivered to the leach pads.
The historical Chapi Mine is comprised of two principal open pits, underground workings, a crushing and agglomeration circuit, heap leach pads, a solvent extraction plant, an electrowinning copper cathode plant, and related infrastructure including mine camp, office facilities, water supply, and power. Since 2012, Chapi has been under care and maintenance with the principal permits for mining operations remaining in place under a temporary suspension.
