Tongling, China Railway to invest $3b in Ecuador copper mine

(Agencies)
Updated: 2010-08-13 16:53

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Tongling Nonferrous Metals Group Holdings Co and China Railway Construction Corp may invest as much as $3 billion in a copper project in Ecuador, as China seeks to control more commodity assets to feed its economy.

Production at the Corriente Copper Belt may start in 2013, Hu Guobin, vice-president of a venture set up by the two Chinese companies for the project, said in an interview. Annual copper in concentrate output would start at 30,000 tons and double a year later, he said.

Chinese companies spent more than $30 billion last year buying oilfields and mines as two decades of economic growth averaging 10.1 percent made China the world's biggest metal and energy consumer. Copper prices have doubled in the past five years, driven by demand in the third-largest economy.

"The investment will significantly lift Tongling's copper ore self-sufficiency and investors expect the assets to be injected into the listed unit later," Heng Kun, an analyst at Essence Securities, said by phone.

Tongling Nonferrous Metals Group Co rose 2.4 percent to close at 16.20 yuan at the 3 pm close in Shenzhen. China Railway rose 0.4 percent to HK$10.08 ($1.3) at the 4 pm close in Hong Kong.

Tongling, China's second-biggest copper producer, and China Railway Construction, the nation's biggest railroad builder, in December agreed to buy Canada's Corriente Resources Inc for C$679 million ($652 million) for the copper resources. The deal was completed and Corriente was delisted this month, according to a statement on Corriente's website.

Go KRY.

Good luck to all.