Rio Tinto Selling Stake in Peru’s La Granja Copper Mining Project


Rio Tinto Group recently agreed to sell a 55% majority stake in its La Granja copper project in Peru to First Quantum Minerals Ltd. The deal involves the First Quantum paying U.S. $105 million. The hope is that the sale will allow the project to progress even faster. It should also allow the Rio team to concentrate more on their flagship copper mining developments in Mongolia and the United States.

Rio Tinto has described the La Granja project as one of the world’s largest untapped copper veins, with significant potential for development. Aside from the initial purchase price, First Quantum will invest an initial U.S. $546 million into the site as part of the agreement. According to a joint statement released by the companies on Friday, this will allow First Quantum to access and progress the site’s potential development via a feasibility study.


La Granja is a challenging ore body situated in the high-altitude region of Cajamarca in Northern Peru. Moreover, despite its complex nature, the site boasts an indicated and inferred mineral resource of 4.32 billion tons at 0.51% copper. This represents a tempting deposit for any copper mining firm. With Rio Tinto and First Quantum Minerals now joining forces to develop the site, the project should expand quickly. Indeed, given their combined development capabilities, the world could have a major new source of copper very soon.

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Benefits of La Granja Copper Mining Stake

It was 2006 when Rio Tinto acquired the La Granja Project from the Government of Peru. The company carried out an extensive drilling program in the intervening years, significantly expanding the declared resource and information regarding the ore body. Rio Tinto also partnered with host communities and national and regional governments during that time. Further developing the La Granja will significantly strengthen Rio Tinto’s copper portfolio.

Copper Mining Ramps Up Amidst Fears of Future Shortages

Copper is essential to the global shift toward clean energy. The metal has a range of applications for everything from electric vehicles to wind turbines. Moreover, S&P Global expects copper demand to increase significantly over the next decade, potentially doubling from current levels.


However, the growing demand for copper in the clean energy sector, supply chain disruptions, and under-investment in copper mining has led to concerns about a looming shortage. Many analysts continue to warn of the potential for severe scarcity in the future.

The La Granja announcement comes on the heels of the commencement of underground mining at Oyu Tolgoi in Mongolia in March 2023. Analysts forecast that Oyu Tolgoi will become the fourth-largest copper mining operation in the world by 2030. Open pit mining at Oyu Tolgoi has been operational since 2011. Currently, it’s producing ore from 1.3 kilometers below the surface of the Gobi Desert.

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Rio Tinto Optimistic About Copper Demand


Last year, Rio Tinto finished acquiring the remaining 49% stake in Turquoise Hill Resources, which owned part of the Mongolian mine. Furthermore, the move had given the mining company a 66% stake in the world’s largest known copper and gold deposit. As of this writing, the Mongolian government holds the remaining 34%. Altogether, Rio Tinto expects to spend about U.S. $7 billion on the underground project. However, analysts expect the mine to produce around 500,000 tons of copper per year.

Meanwhile, Rio Tinto’s top honchos believe that the short-term outlook for copper is “healthy.’ This is despite global stockpiles trending down and mine disruptions eroding supply from Latin America.

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