China Yunnan Copper Australia Ltd. (CYU.AU), or CYU, an Australian-listed affiliate of Aluminum Corp. of China Ltd. /quotes/comstock/13*!ach/quotes/nls/ach ACH +0.18% , or Chinalco, will enter an joint venture with Rio Tinto PLC /quotes/comstock/13*!rio/quotes/nls/rio RIO -0.04% covering copper exploration in Chile.
CYU's main shareholder is Yunnnan Copper Industry (Group) Co. Ltd., which is in turn majority-owned by Chinalco. Chinalco is also the largest shareholder in Rio Tinto, holding around 9% of its U.K.-listed shares.
CYU said Wednesday it would explore Palmani and Caramasa, two tenements close to BHP Billiton Ltd.'s /quotes/comstock/13*!bhp/quotes/nls/bhp BHP +0.52% Cerro Colorado mine with good prospects for porphyry, a copper ore which often contains significant quantities of gold, silver and molybdenum. The company could earn a 40% interest in each project if it spends a minimum of US$18 million over five years on the two projects.
Last December, Rio Tinto and Chinalco announced a joint venture to carry out exploration activities in China, although the companies haven't said which commodities they would be looking for.
The companies' largest joint venture, the Simandou iron ore project in the west African country of Guinea, saw progress last week when Rio Tinto signed a deal with Guinea's government that will allow Guinea to raise its eventual stake in the project to 35%.
Chinalco has agreed to pay US$1.35 billion to Rio Tinto to take a 44.65% stake in the project, which is currently 95% owned by Rio Tinto and 5% by the World Bank's International Finance Corp. That stake would diminish as Guinea's ownership of Simandou rises.
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