Reuters reported that global miner Anglo American Plc and world No 1 copper producer Codelco have asked a local court to extend their negotiation window to July 17th 2012 from June 22nd 2012.
The mining titans requested the extension to allow talks to continue suggesting they may be close to a deal to end a bitter dispute over coveted copper assets.
Anglo American and Codelco have agreed to extend the period for exploring the possibility of negotiating an agreement in relation to Anglo American Sur.
A source who is close to Codelco's legal team said that the companies requested a July 17 conciliation session. Reuters had exclusively reported that the companies would seek more time to talk. Investors have been watching to see if Chile's state owned copper giant Codelco and Anglo will hash out a deal or whether they return to a courtroom for a showdown that could drag on for years.
Mr Juan Ignacio Guzman mining professor at the Universidad Catolica said that "This means they're well on their way to a deal. The contract conflict between Codelco and Anglo centers on an option agreement dating to 1978.”
Codelco said in October that it would exercise the option to buy 49% stake in Anglo American Sur when the option window opened in January. But weeks later, Anglo surprised everyone with the pre emptive sale of a 24.5% stake in AAS to Mitsubishi Corporation in USD 5.4 billion deal that dented Codelco's ambitions but which it says secured better value for investors.
Since then, the firms have been tussling for the properties which include the promising Los Bronces mine that used to be called La Disputada, the disputed one in Spanish.
Mr Guzman said that Mitsubishi and Mitsui are also at the table negotiating. They also have to give their opinion. Any deal affects them.
Codelco said in October it had secured USD 6.75 billion bridging loan from Japan's Mitsui & Company to allow it to exercise its option. Los Bronces, which could at its peak be the world's fifth biggest copper mine, stands out in a red metal market defined by its lack of new deposits.
Anglo expects its ramped up mine to more than double annual copper output from 2010 levels in its first 3 years of full production before ebbing on dwindling ore grades. It could produce a peak of 490,000 tonnes of copper annually.
A slice of the prized properties would be a major boost for Codelco, which is battling stubbornly dwindling ore grades in its tired deposits as it seeks to boost its annual output to 2.1 million tonnes by 2020.
Source - Reuters
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