Anglo-Australian miner Rio Tinto (LSE: RIO) is looking to take advantage of the recent market turmoil and the deepening credit squeeze to acquire projects from distressed juniors, according to mining analyst John Meyer with investment bank Fairfax.
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"They are looking for mines with more than a 20-year mine life and the potential for over 200,000t/y," Meyer told BNamericas during a phone interview.
"They haven't named any names because that is not what they want to do if they are looking to buy a company. I think they'll be looking at a few things in Peru and other parts of Latin America," Meyer added.
"We always keep our options open in terms of expansion and growth opportunities, whether they are exploration properties or existing operations. But whether we would be more likely to do so now than at any other time, I couldn't really comment," Rio Tinto spokesperson Nick Cobban told BNamericas.
According to Meyer, it is going to be very difficult for companies without significant balance sheets to borrow, and already the costs of borrowing funds from banks are rising substantially.
This will leave the door open for mining companies with deep pockets to come in and pursue acquisitions.
In Latin America, Rio Tinto is currently developing its La Granja copper deposit in Peru, with an eye to be in production in 2014.
Rio Tinto also has iron ore assets in Brazil and 30% of the world's largest copper mine, Escondida in northern Chile.
