Rio Tinto joins race for Teck's copper project stake: sources

LONDON (Reuters) - Rio Tinto is among parties making a final offer for a minority stake in Teck Resources Ltd’s Quebrada Blanca copper mine expansion in northern Chile, a development worth $4.8 billion, two sources close to the matter said.

FILE PHOTO: A sign adorns the building where mining company Rio Tinto has their office in Perth, Western Australia, November 19, 2015. REUTERS/David Gray/File Photo

The world’s second largest mining company is eager to boost its copper assets, with the metal viewed in the industry as having one of strongest outlooks. Existing reserves are dwindling and increased electrification means demand is likely to be strong.

Canada's Teck TECKb.TOTECK.N has said a development partner could contribute $2 billion for a 30 percent to 40 percent stake in the copper project, an investment deal it expects to close in the fourth quarter.

Rio Tinto declined to comment and Teck Resources did not respond to a request for comment.

Final offers are also expected from Japanese trading houses Mitsubishi Corp 8058.T and Sumitomo Corp 8053.T, which are scouting for mining assets to buy with growing profit, driven by higher commodities prices, the sources said.

Mitsubishi, which recently agreed to raise its stake in the Quellaveco copper project in Peru it shares with Anglo American Plc AAL.L, and Sumitomo were not immediately available to comment.

China's state-owned Aluminum Corp of China (Chinalco) and Canadian base metals miner Lundin Mining Corp LUN.TO are also likely to put in offers, while the interest from Canada's Freeport [FCXFM.UL] waned, one of the sources said.

There are not many copper assets currently available on the market and big mining companies, restored to health following the 2015-16 crash, are still seeking to rationalise their portfolios and only look for best quality mines.

The world's biggest listed miner BHP BHP.AXBLT.L has managed to buy a stake in SolGold's SOLG.L promising copper-gold discovery in Ecuador, having earlier agreed to sell the Cerro Colorado mine in Chile to Australian private equity fund EMR Capital.

Rio Tinto has agreed to sell its stake in Indonesia’s Grasberg, the world’s second biggest copper mine, as part of a series of complex deals drawn up in response to the country’s pursuit of greater control over its natural resources.

Reporting by Clara Denina; additional reporting by Barbara Lewis; Editing by Jan Harvey