China’s Zijin Mining to acquire $550 million stake in smaller copper firm

China’s Zijin Mining Group Co said on Sunday it would pay US$548 million to acquire a majority stake fellow Chinese mining group Tibet Julong Copper Co Ltd.

Zijin will take a 50.1% stake in Tibet Julong, which owns rights to two copper deposits in Tibet: The Qulong mine – one of China’s biggest copper deposits – and the Zhibula mine.

The Qulong mine can produce 30 million tonnes of ore annually, while the smaller Zhibula mine can produce 1.2 million tonnes a year, according to a Zijin filing on the Shanghai Stock Exchange. Both mines also contain molybdenum and silver.

In the announcement, the company declared that the acquisition is aimed at boosting its resource base and achieving sustainable development.

Zijin, which is best known as a gold miner and one of China’s major smelters, is taking over these domestic mines as concerns grow amongst copper smelters over raw material supply due to COVID-19 related mine closures around the world.