NEW YORK/TORONTO Teck Resources Ltd (TCKb.TO), Newmont Mining Corp (NEM.N), private equity firm Blackstone Group LP (BX.N) and a firm led by the former head of Barrick Gold (ABX.TO) are working together on a bid for Glencore Xstrata's (GLEN.L) Las Bambas copper mine in Peru, according to several people familiar with the matter.
China's Minmetals has so far been seen as the front runner for the $5.9 billion project after Chinalco (3668.HK), the largest aluminum producer in China, dropped out of the race.
The next round of bids for Las Bambas is due next month, according to several sources.
The sources did not want to be named because the process is private and ongoing.
Teck, Newmont, Blackstone and Magris Resources, a firm led by former Barrick CEO Aaron Regent, have already reached out to financing banks for the potential bid, one of the sources said, suggesting the consortium sees itself a serious contender.
Commodities trader Glencore agreed this year to sell Las Bambas to secure approval from China's competition authorities for its takeover of miner Xstrata because Beijing feared the merged group would have too much power over the copper market.
A Chinese buyer has been considered a virtual certainty since Las Bambas was put on the block, given the deep pockets of the country's state-owned enterprises and China's hunger for copper - it is already the world's top consumer of the metal.
Teck, Magris and Blackstone declined to comment. A spokesman for Newmont was not immediately reachable for comment.
MMG (1208.HK) - the Hong Kong-listed offshore arm of China Minmetals Corp - is bidding alongside CITIC group and other smaller partners, though the final lineup is still unclear.
Initial bids for Las Bambas came in around $6 billion last month, including the sum invested in construction so far - close to analysts' estimates of the mine's value. In a research note published in May, Nomura analysts put the end-2014 value at about $6.2 billion.
By the time a sale is agreed, Glencore Xstrata estimates that it will have spent $3.3 billion on Las Bambas. It has estimated the total construction cost will be $5.9 billion.
Las Bambas, one of the largest mines in Xstrata's project portfolio, is due to begin production in 2015. It is expected to produce more than 450,000 tons of copper a year in its first five years and 300,000 tons a year thereafter.
(Reporting by Greg Roumeliotis and Michael Erman in New York and Euan Rocha in Toronto; Editing by Gary Hill and Phil Berlowitz)