Mining giant GlencoreXstrata is preparing to sign an agreement with a Chinese consortium, led by Minmetals, for the sale of its $5.2bn Las Bambas Peruvian copper project in Peru.
Glencore and China Minmetals will hold discussions regarding the signing of the agreement, reports The Wall Street Journal.
In May 2013, GlencoreXstrata launched the sale process for its Las Bambas copper mine, which is located about 70km south-west of Cusco. The sale process was initially delayed by bidder requests and later by disagreements.
The project is said to have more than 10.5 million tonnes of copper resources, and is in an advanced phase of construction with operations scheduled to commence in 2015.
The project is expected to produce around 400,000t of copper annually during its first five years of operation, roughly comprising 2% of the world's supply.
The sale of Las Bambas is claimed to be one of largest acquisitions of a mining asset by China, which accounts for nearly 40% of the global copper demand.
The Las Bambas acquisition is expected to give China greater control of the global copper market.
Also, the deal would give affiliates of Minmetals and Australia's MMG a controlling stake in the consortium.
The remaining interest will be shared between Citic Group and China Reform, an investment company under government authority.
The Anglo-Swiss multi-national mining company has appointed BMO Capital Markets and Credit Suisse Securities (Europe) as financial advisors for the sale process.
Chinese firms Chinalco Mining and Hong Kong-listed MMG are two of the numerous firms and investors that have expressed a bidding interest in the project.
Image: Las Bambas mine has around 10.5 million tonnes of copper resources. Photo: courtesy of Jonathan Zander.