Minmetals deals with Chile

State-owned Chinese mining group Minmetals signed an agreement Tuesday with Corporación Nacional del Cobre de Chile (Codelco), the world’s largest copper producer, to develop copper mines in Chile.

The deal gives financial aid to Codelco to expand its operations while giving China access to more copper at a time when the Asian nation is becoming more dependent on foreign sources for raw materials.

Minmetals will put US$550 million into Codelco in the first phase of a reported US$2 billion commitment to developing copper projects and making supply deals with the Chilean company.

As part of the deal, Minmetals was given the option of acquiring a stake in Codelco’s Gaby copper mine at some time in the future. Minmetals is also reportedly trying to put together a partnership with Canadian base metals producer Noranda in order to ensure another source of supply for metals.

Minmetals is not the only Chinese metals group to be looking for deals in the Americas. Baosteel, China’s largest steel maker, has an agreement with Companhia Vale do Rio Doce to build a plant in Brazil that will produce 4.1 million tonnes of steel per year.

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