Exclusive-Miners seek partners for copper assets as M&A heats up
By Clara Denina, Divya Rajagopal and Julian Luk
LONDON (Reuters) — A flurry of copper mining deals are being lined up for the next six to 12 months, industry sources said, as producers seek to spread the soaring cost of new projects for the metal key to the energy transition.
The capital needed to develop new mines has shot up some 50% to between $3 billion-$4 billion on average in recent years, fuelled by declining ore grades, stricter environmental requirements and rising labour costs.
Copper producers increasingly want to share the risk and costs of projects, and the sector has already seen a jump in M&A activity, which more than doubled year-on-year to $14.24 billion in 2022.
But big-ticket M&A is not the only solution to rising costs, and partnership deals are also being mooted, five sources familiar with the matter said.
For investors interested in the green transition, that would allow them to own a portion of existing assets and revenues at a time when large reserves of top-grade material are hard to find.
Miner and trader Glencore (OTC:GLNCY) has been approached by potential investors in its Argentine copper projects Minera Agua Rica Alumbrera (Mara) and El Pachon, two sources said.
Japan's Sumitomo Metal Mining is among interested parties, one said. According to Argentine government data, the projects could produce a combined 435,000 tonnes of copper a year.
Glencore declined to comment, while Sumitomo did not respond to a request for comment for this story. Both sources declined to be named because the information is not public.
Canada's Lundin Mining (OTC:LUNMF) is also in talks with Japanese trading houses and large miners to offer a 40% to 50% stake in Argentina's Josemaria mine, incoming CEO Jack
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