TNR Gold Corp (TSX-V:TNR, OTC:TRRXF) has welcomed the latest progress at the Los Azules copper project in Argentina, where McEwen Copper has applied for admission to the country’s Large Investment Incentive Regime (RIGI).
The move could bring significant tax benefits and regulatory stability as the project advances toward a construction decision.
Los Azules, one of the world’s top ten undeveloped copper deposits, is estimated to require an investment of $2.7 billion. Of that, $227 million has already been committed for feasibility studies, exploration, and preliminary construction work.
If approved under the RIGI program, the project would benefit from a reduced corporate tax rate, exemptions from export duties, and financial incentives that could help accelerate development.
TNR Gold holds a 0.4% net smelter returns royalty on the project and sees the latest developments as a positive step toward unlocking long-term value.
Kirill Klip, CEO of TNR Gold, said, "We are pleased that McEwen Copper has reached this major milestone after it secured the environmental permit for the construction and operation of the Los Azules Copper Project.
"We have repaid our investment loan in full and our company has no debt. We believe that the recent market prices of our shares do not properly reflect the underlying value of the shares.
"Our transformation from a project generation junior mining company into a cashflow-generating royalty company may bring the necessary catalyst for improved market valuation of our assets.
"The admission to RIGI could move the Los Azules copper project development closer to the construction decision, which may be made as soon as this year after the release of a feasibility study."
Los Azules has attracted strong backing from major industry players, including miner Rio Tinto and Stellantis, the international car maker.
Klip highlighted the importance of the project in meeting global clean energy goals. "The green energy rEVolution relies on the supply of critical metals like copper; delivering 'green copper' to Argentina and the world will contribute to the clean energy transition and electrification of transportation and energy industries."
McEwen Copper has been advancing Los Azules at a steady pace. The company recently secured environmental approval and expects to complete its feasibility study in early 2025. With construction potentially beginning in early 2026, the project is positioned to become a major driver of economic growth in Argentina’s San Juan province.
TNR Gold remains confident in its business model, which allows it to benefit from projects like Los Azules without needing to contribute development capital.
"The essence of our business model is to have industry leaders like McEwen Mining as operators on the projects that will potentially generate royalty cashflows to contribute significant value for our shareholders," Klip said.