Rio Tinto and CODELCO will develop next generation copper mining and processing technology together.
The Río de Cobre (River of Copper) alliance will work to find ways to achieve more energy efficient, safer and lower production costs from current and next generation open cut and deep underground mines.
It also wants to find ways to reduce environmental impact.
The alliance says it will especially look at technology development in underground mining, surface mining and copper mineral recovery areas.
Rio Tinto chief executive Tom Albanese said the project will merge the company's mine of the future effort with CODELCO's copper technology expertise, allowing both companies keep up with rising copper demand.