In a sign of a healthy mining industry, Rio Tinto has indicated that it is searching for copper acquisitions as it tries to position for what it will believe is strong demand for the metal.

Reuters reported that company and banking sources have said Rio Tinto is prepared to pay premium prices for quality copper projects. Rio Tinto, and others believe copper demand will be high, driven by the growing electric vehicle and renewable energy industries, the sources said.

The approach under CEO Jean-Sebastien Jacques marks a shift for Rio Tinto, known for its cautious strategy since it was badly burned in the commodity price crash earlier this decade after a series of damaging acquisitions.

“Growth is back on the agenda,” Jacques told a mining dinner in London, but he said Rio would be selective.

Kevin Fox, managing director of Rio Tinto Ventures, a division set up to hunt for established mining projects to acquire, told Reuters it was tough to find quality assets.

“The exploration space is not full of wonderful opportunities,” he said. “What are we looking at? It’s trite to say the battery minerals sector is attracting a lot of interest and we are obviously looking at that. We include in that copper.”

He declined to say how much Rio would pay or to specify any projects.

More than a year after the division was set up, it has yet to make an acquisition.

Banking sources say pressure is mounting for a copper deal.

Iron ore, which accounts for most of Rio’s profit, has provided healthy margins for years but the outlook is uncertain as major buyer China is expected increasingly to rely on recycling rather than importing fresh ore.

Copper, by contrast, is regarded as a futureproof metal because of its widespread industrial use.

Among bigger options for Rio Tinto is Canada’s First Quantum Minerals, according to the banking sources. The $10 billion miner’s copper assets account for around 80 percent of its revenue.

Vancouver-based Nevsun Resources could also prove attractive, said bankers and analysts. Nevsun rejected a $1.16 billion joint offer from Lundin Mining and Euro Sun Mining Inc in May.

Quantum Minerals and Nevsun did not respond to requests for comment.

Rio Tinto could also look to increase its 51 percent stake in Mongolia’s giant Oyu Tolgoi mine, the bankers said. It would much prefer to increase its 30 percent stake in Chile’s Escondida, the world’s biggest copper mine which is operated by BHP, the sources added, though the chances of a deal are remote.

Compared with BHP - its closest rival and the world’s biggest listed miner - Rio Tinto has a heavier reliance on iron ore and lags on copper. BHP derives 44 percent of its core profit from iron ore, against Rio’s 60 percent, and has more than twice as much copper output.
Rio does not break out its copper profits separately, but its copper and diamonds division generated about 10 percent of its core profit. BHP’s copper accounted for around 17 percent.

Rio Tinto’s shares have outperformed BHP’s for more than a year, but bankers and analysts say the differences in their portfolios could cost Rio investors in coming years.