http://business.financialpost.com/
Vancouver’s Teck Resources is buying out a minority partner in a major copper project in Chile at a cost that could reach as high as $262.5 million.
The total price tag, however, will depend on copper prices — often considered a barometer for global macroeconomic growth because it is used in so many products — and which at the moment are sliding as the U.S. and China slap tariffs on one another, and fears of a trade war escalate.
“A company’s decision to build or not build (a mine) — these are long term forward-looking decisions,” said Alex Terentiew, an analyst at BMO Capital Markets who monitors Teck.
Terentiew said copper prices, which stood around US$3.06 per pound on Thursday, are not dropping off in a worrying way. In a note, he forecast a “skew of risk to the upside” for copper prices, based on a growing need in China for concentrates.
Under the deal announced on Wednesday, Teck increases its stake in Quebrada Blanca Phase 2: an open pit copper mine in northern Chile’s high desert expected to produce 300,000 tons of copper per year for its first five years.
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