Citic Resources may bid for Glencore’s Las Bambas copper mine project

3 September 2013 (Last Updated September 3rd, 2013 18:30)

Citic Resources may consider bidding for Glencore Xstrata’s $5.2bn Las Bambas copper mine project in Peru.

Copper

Citic Resources may consider bidding for Glencore Xstrata's $5.2bn Las Bambas copper mine project in Peru.

Bloomberg reported the information based on four sources who wish to remain anonymous.

China-based Chinalco Mining, a subsidiary of China's state-run aluminum group, and Hong Kong-listed MMG are also eyeing to bid for the copper project.

Located near Cusco, the Las Bambas project has more than 10.5 million tonnes of copper resources.

The project, which is currently in an advanced phase of construction, is expected to begin production in 2015.

Las Bambas is expected to produce around 400,000t of copper per year during its first five years of operation, roughly comprising 2% of the total world's supply.

In July 2013, Glencore Xstrata appointed BMO Capital Markets and Credit Suisse Securities (Europe) to act as financial advisors for the sale process.

The sale agreement is due to be signed by the end of the third quarter of 2014 and must be concluded by the first half of 2015.

The company is required to sell Las Bambas as a condition of approval from Chinese regulatory authorities for the merger of Glencore and Xstrata.

China is concerned that the merged entity would dominate the world's copper market with more than a 7% share.

Apart from Citic Resources, Chinalco Mining and MMG, several other international mining firms and potential investors have also expressed interest in the Las Bambas project.


Image: Las Bambas mine has around 10.5 million tonnes of copper resources. Photo: Courtesy of Jonathan Zander.

Mining