The $14bn Australian mining group South32 is believed to be exploring offshore acquisitions collectively worth about $US3bn ($3.9bn) in Spain and Latin America.
Thought to be on its shopping list is the flagship operation of Trafigura Mining in Spain, Matsa, for which a sales process is understood to be about to start, and a stake in the Sierra Gorda copper mine in Chile.
Meanwhile, speculation is mounting that other Australian groups such as Oz Minerals and potentially Sandfire Resources or IGO could also be lining up to take a look at the assets.
While South32 declined to comment, sources say that the former BHP spin-off is set to be in the mix for the mines at least in the early stages of the sales processes as it positions itself to capitalise on the clean energy boom.
Sumitomo announced in October that it was reviewing its options for Sierra Gorda, and sources suggest that the stake up for sale is worth close to $1bn, with a sales process underway.
The copper mine is owned by Sumitomo and Poland’s KGHM, which has a 55 per cent interest, and working on the sale has been RBC Capital Marks and law firm Sullivan & Cromwell.
On average, it produces 110,000 tonnes of ore daily.
Matsa, or Minas– de Aguas Tendias, is believed to be worth at least $US2bn and a sales process for that asset is expected to get underway shortly.
It consists of the Aguas Tenidas, Sotiel and Magdalena mines in southern Spain which produce up to 4.6m tonnes annually of copper, zinc and lead concentrates with silver by-products.
It is owned by Abu Dhabi wealth fund Mubadala as well as commodities trader Trafigura.
Copper prices have soared amid a major commodity boom fuelled by demand from China and at a time more mining groups look to secure a larger supply of the metal used for manufacturing electric vehicles.
One market expert told DataRoom that Matsa produced good quality copper and the mines still had a long life and had been well run by their owners.
Acquiring an interest in that part of the world would be considered highly strategic for a number of groups and the process was expected to be competitive.
While Sierra Gorda was not of the same quality, it was a technically strong performer and would attract strong interest from traders hoping to get more of a foothold in the country that produces 30 per cent of the world’s copper.
South32 made its intentions clear to distance itself from less environmentally friendly commodities this week as its boss Graham Kerr announced carbon reduction targets, in what was a signal it will steer clear of any sales processes for coal mines.
It will also transfer ownership of its South Africa thermal coal operations next month.
It comes as BHP looks to sell or demerge its coal operations as investors become more concerned about the fossil fuel related to environmental, social and governance matters for companies.
Sources say that first round bids were due last week for the BHP sales process of the assets that last year were valued at about $7bn.
These include its Mount Arthur thermal coalmine operation in NSW, the stake it owns in its Cerrejon thermal coal mine in Colombia and two metallurgical coal mines in Queensland held as part of an alliance agreement with Mitsui Coal known as BMC.
DataRoom understands an Indonesian party has shown interest in some of the assets.
Possible candidates could include Indonesia’s Golden Energy that controls Stanmore Coal or thermal coal exporter Adaro Energy.
Black funds dedicated to buying out-of-favour assets and offering a clean energy solution that sees them wound down over time are also said to be showing an interest.
Among the groups said to be setting up such funds is the commodity trader Trafigura and global investor Blackrock.
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