When China’s Ministry of Commerce approved the merger of Glencore and Xstrata it was done with the condition that the new company sell its Las Bambas copper project in Peru so that the new company would not control too much of the global copper market.

Now, it seems, China could be in the running to own the Peruvian mine. On Aug. 21 China's largest copper producer by output, Jiangxi Copper Co. Ltd., said it plans to bid for the Peruvian copper mine, raising the prospect of a Chinese consortium’s pursuing the $5 billion project, the Wall Street Journal reported.

“We are currently considering plans to make the purchase, but haven’t talked about a specific price,” Jiangxi Copper Board Secretary Pan Qifang said.

Glencore has said the mine will cost $5.2 billion to develop.

This is the second reported interest in the mine from China. The Wall Street Journal reported that China's Chinalco Mining Corp. International was close to appointing investment banks Goldman Sachs Group Inc. and Morgan Stanley to advise it on buying the Peruvian property, according to people with knowledge of the matter.

Chinalco Mining is the Hong Kong-listed copper unit of Aluminum Corp. of China, the country’s largest aluminum and alumina producer by output.
Pan did not say whether Hong Kong- and Shanghai-listed Jiangxi Copper would partner with Chinalco in its bid.

Chinalco’s advantage is that it already operates the Toromocho copper mine in central Peru, giving it familiarity on the ground. Toromocho is expected to start producing copper in the fourth quarter of 2013 and reach full production capacity in the third quarter of 2014, according to the company.

Tang said the last joint bid by Chinese state-owned enterprises came in 2007, when Jiangxi worked with Zijin Mining Group Co. Ltd. and China Metallurgical Group Corp. in pursuit of the Aynak copper deposit south of Kabul in Afghanistan.

Conscious of the need to protect China's access to imported copper to feed industry, China's Ministry of Commerce required Glencore to divest itself of Las Bambas even though the company does not operate any copper-mining or processing facilities in China. Jiangxi Copper consumes more than 30 percent of global copper production, and it has sought to shore up overseas copper reserves as it has also pursued foreign supplies of oil and natural gas.

Glencore said the mine is scheduled to produce 400 kt/a of copper from 2015. China currently imports about 3.4 Mt/a of refined copper.

Glencore said the sale price should be the fair value of the project as determined by two independent investment banks it selected, or cover all the project costs incurred before a deal is agreed upon. The parties must agree to a sale by the end of the third quarter of 2014 and must close by the end of the first half of 2015 to meet China’s conditions.

If Glencore fails to enter a binding agreement on the project sale or transfer the asset in time, it said it would then have to execute a rapid sale of one of four other copper projects: Tampakan in the Philippines, Alumbrera or El Pachon in Argentina, or Frieda River in Papua New Guinea.