{"id":96431,"date":"2025-10-31T11:16:19","date_gmt":"2025-10-31T14:16:19","guid":{"rendered":"https:\/\/murray.adv.br\/?p=96431"},"modified":"2025-10-31T11:16:19","modified_gmt":"2025-10-31T14:16:19","slug":"codemig-cbmm-renew-niobium-deal-until-2070-2","status":"publish","type":"post","link":"https:\/\/murray.adv.br\/en\/codemig-cbmm-renew-niobium-deal-until-2070-2\/","title":{"rendered":"Codemig, CBMM renew niobium deal until 2070"},"content":{"rendered":"
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New agreement replaces contract set to expire in 2032 and increases Codemig\u2019s share in CBMM\u2019s results<\/em><\/strong><\/h6>\n<\/div>\n<\/div>\n
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10\/31\/2025\u00a0<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/section>\n

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The Minas Gerais Development Company (Codemig<\/strong>) and the Brazilian Metallurgy and Mining Company (CBMM<\/strong>), controlled by the\u00a0Moreira Salles<\/strong>\u00a0family, have signed a new agreement ensuring the continued extraction of niobium from the Arax\u00e1 mines in Minas Gerais for another 30 years, with the possibility of a 15-year extension\u2014keeping operations running until 2070.<\/p>\n<\/div>\n

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The new contract replaces the previous one, which was due to expire in 2032, and increases Codemig\u2019s share in CBMM\u2019s profits to include 25% of the earnings from the sale of materials other than niobium, such as rare-earth elements, without requiring any additional investment from the state-owned company.<\/p>\n<\/div>\n

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Lu\u00edsa Barreto<\/strong>, CEO of both Codemge and Codemig, told Valor the decision to renew the partnership ahead of schedule followed economic analyses that showed it was the best option to boost revenue and enhance the company\u2019s value, at a time when the state government is debating the federalization of its assets.<\/p>\n<\/div>\n

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\u201cThis partnership brings the greatest value to Codemig. Beyond extending the collaboration, we secured better terms that generate more returns for both the company and the state of Minas Gerais, including participation in CBMM\u2019s future investments,\u201d Ms. Barreto said.<\/p>\n<\/div>\n

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Updated market valuations for Codemig are expected to be released in the coming weeks, as they will now include potential revenue from other minerals. According to Ms. Barreto, the new structure also strengthens oversight mechanisms and ensures greater predictability for public finances and legal certainty, securing dividend payments for decades.<\/p>\n<\/div>\n

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Among the alternatives evaluated by the state-owned company were launching a new bidding process, direct mining of niobium, or renewing the existing partnership with CBMM. The renewal was deemed the most viable option. \u201cOther partners would hardly be able to achieve the same sales volume or market share we currently have,\u201d she noted.<\/p>\n<\/div>\n

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Codemig is compensated through a silent partnership (SCP), which grants the state-owned company 25% of CBMM\u2019s net profit. In 2024, the partnership generated R$1.73 billion for the Minas Gerais-based company.<\/p>\n<\/div>\n

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Since 1972, Codemig and CBMM have jointly operated neighboring mines in Arax\u00e1 through the Companhia Mineradora do Pirocloro de Arax\u00e1 (Comipa), in which Codemig holds 51% and CBMM 49%. Comipa extracts the ore and sells it exclusively to CBMM, which processes and markets the final product.<\/p>\n<\/div>\n

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Current estimates indicate that Codemig\u2019s mine will be depleted in the early 2060s, while CBMM\u2019s deposits could last until 2070 if production continues at the current pace. Until the new deal, Codemig was entitled to 25% of profits only from niobium and was required to invest 25% in other projects to earn proportional returns, as with barite and magnetite.<\/p>\n<\/div>\n

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\u201cWe had already participated in those investments, but we had to contribute 25% to be entitled to the profits. Now, when CBMM explores other minerals,\u00a0including rare earths,<\/a>\u00a0which we know are present in our deposits, we will earn profits without any additional investment,\u201d Ms. Barreto explained.<\/p>\n<\/div>\n

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Rare-earth elements are not yet economically viable for extraction, but if conditions change, Codemig\u2019s stake will already be guaranteed<\/strong>. The new contract also ensures Codemig 25% of profits from the potential sale of mining tailings until 2085, even after the partnership ends.<\/p>\n<\/div>\n

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The extended term also resolves long-standing questions about the contractual balance between the two companies. Codemig\u2019s mine contains a higher niobium grade, while CBMM\u2019s has larger reserves and a longer lifespan\u2014an issue that had raised concerns among regulatory bodies about the fairness of the arrangement. With the new timeframe, projections show that by the end of the contract, CBMM\u2019s extracted volume will surpass Codemig\u2019s, balancing the deal.<\/p>\n<\/div>\n

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\u201cStudies show that, considering the contract through 2070, the total volume of niobium extracted from CBMM\u2019s mine will exceed that from Codemig\u2019s, even after accounting for ore grade differences,\u201d Ms. Barreto said.<\/p>\n<\/div>\n

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This is the third major agreement Ms. Barreto has led on behalf of Minas Gerais<\/strong>. She was also responsible for renegotiating the Mariana and Brumadinho settlement agreements following catastrophic damn breaches around iron mines.<\/p>\n<\/div>\n

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Today, the global ferroniobium market is estimated at fewer than 128,000 tonnes, still limited compared to other minerals critical to the energy transition, such as lithium, with CBMM maintaining global leadership.<\/p>\n<\/div>\n

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The company strategically operates below full capacity, helping set the market\u2019s space, but has been expanding into new markets for niobium, which remains primarily used in the steel industry.<\/p>\n

*By\u00a0Robson Rodrigues, Valor\u00a0\u2014 S\u00e3o Paulo<\/p>\n

Source: Valor International<\/p>\n

https:\/\/valorinternational.globo.com\/<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<\/article>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

New agreement replaces contract set to expire in 2032 and increases Codemig\u2019s share in CBMM\u2019s results     10\/31\/2025\u00a0 The Minas Gerais Development Company (Codemig) and the Brazilian Metallurgy and Mining Company (CBMM), controlled by the\u00a0Moreira Salles\u00a0family, have signed a new agreement ensuring the continued extraction of niobium from the Arax\u00e1 mines in Minas Gerais […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8106],"tags":[26560,26559,26561],"class_list":["post-96431","post","type-post","status-publish","format-standard","hentry","category-murray-news","tag-cbmm","tag-codemig","tag-renew-niobium-deal-until-2070"],"yoast_head":"\nCodemig, CBMM renew niobium deal until 2070 - Murray Advogados<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/murray.adv.br\/en\/codemig-cbmm-renew-niobium-deal-until-2070-2\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Codemig, CBMM renew niobium deal until 2070 - 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