(Yicai) June 26 -- China's CMOC Group, the world's top cobalt producer, has bought Lumina Gold, securing full ownership of the Cangrejos Gold-Copper project in Ecuador and entering the gold resources market.

The transaction, worth around CAD581 million (USD419 million) according to an April announcement, was closed on June 24, CMOC said in a statement released on the official Wechat today. The Cangrejos project is the 26th biggest primary gold asset globally and the largest in Ecuador.

Earlier today, Ecuadorian President Daniel Noboa met with CMOC Chairman and Chief Investment Officer Liu Jianfeng in Beijing, highlighting the deal's importance for bilateral economic ties.

"South America is rich in gold, copper, and other resources, with relatively stable geopolitics, making it one of the key destinations for Chinese enterprises' strategic layout," Liu noted. CMOC's extensive operational experience on the continent would enable synergies, with plans to develop "a large-scale, low-cost world-class gold mine" while implementing the firm's environmental, social, and governance management framework to benefit local communities, he added.

The Cangrejos project in southwestern El Oro province is a significant addition to CMOC's global portfolio. According to a 2023 pre-feasibility study, its deposit contains an indicated resource of 1.38 billion tonnes grading 0.46 grams per ton of gold, equivalent to 638 tonnes of gold. Proven and probable reserves stand at 659 million tonnes at 0.55 g/t gold, or 359 tonnes of gold, with a projected mine life of 26 years.

The large-scale porphyry deposit offers favorable economics, low stripping ratios, and optimal open-pit mining conditions. Existing infrastructure access to power, water, transportation networks, and ports provides additional operational advantages, with exploration continuing within current concessions and at depth.

The latest acquisition continues the trend of Chinese investment in Ecuador's extractive sector. China Railway Group, PowerChina, PetroChina, Tongling Nonferrous, and other state-owned companies have established operations spanning infrastructure, oil and gas, and copper mining since the 2000s.

CMOC was established as a non-ferrous metal processor in 1969. The Cangrejos is its second major South American investment following the 2016 purchase of Brazilian niobium and phosphate operations.

Luoyang-based CMOC ranks among the world's leading producers of copper, cobalt, molybdenum, tungsten, and niobium while maintaining significant phosphate fertilizer operations in Brazil.

Shares of CMOC [SHA: 603993] closed 2.8 percent higher at CNY8.15 (USD1.14) apiece today. The broader Shanghai Composite Index fell 0.2 percent.

Editor: Martin Kadiev