By Arnika Thakur
BANGALORE |Thu Feb 3, 2011 6:56pm EST
Reuters) - Canada's Candente Copper Corp (DNT.TO), which owns one of the largest undeveloped copper deposits in Peru, is ready to sell itself but only at double its current value, its chief executive said.
With copper prices rising, Canadian miners HudBay Minerals Inc (HBM.TO) and First Quantum Minerals (FM.TO)have recently bought small Peru-focused miners, putting the spotlighton Candente's Canariaco Norte copper project in the South Americancountry.
"There are many companiesinterested in buying our project, but we would not sell at anything nearour current market cap ... we are working very hard to get a bettervaluation on our shares right now," Candente's co-founder and CEO JoanneFreeze told Reuters by telephone.
TheCanariaco project has a current resource base of 10.3 billion pounds ofcopper equivalent, nearly a quarter of estimated global copper demandthis year. It is Candente's primary project.
Canariaco is valued at nearly 2.5 cents a pound, Freeze said, or $250 million.
"It'sa robust project and copper is an attractive commodity right now," saidFreeze, who lived and worked in Peru in the mid-1990s and has headedthe mineral explorer for nearly 14 years.
She said many groups were interested in partnering with Candente on the project, but declined to give details.
Freezewants at least 5 cents a pound for the project, which is moving fromthe pre-feasibility stage, with commercial production targeted by 2015.
Theaverage price for such projects in Peru is about 3.8 cents a pound,said Stonecap Securities analyst Gary Hon, who values Canariaco at about2.4 cents a pound.
THE BETTER MINE
InDecember, First Quantum completed the acquisition of Antares MineralsANM.V, which owns the Haquira project, and last month, HudBay agreed tobuy Norsemont Mining Inc NOM.TO to get access to the Constancia copperproject.
Canariaco stacks up well versus Constancia and Haquira, Wellington West analyst Steve Parsons wrote in a recent note.
Candente may spark interest from Chinese companies, given the increasing demand for copper and gold.
"Some of the obvious ones could be the Chinese as they're quite interested in the region," said Hon at Stonecap Securities.
Zijin Mining Group Co Ltd (601899.SS) was cited as a potential partner for Candente in 2006 to develop the Canariaco project, Hon wrote in a client note.
The cost of developing the mine is estimated at more than $1.4 billion, which raises funding issues, analysts said.
"I don't see any funding restraints," said Freeze.
Candenterecently raised about $30 million, she said, and believes that PeruvianPension Funds -- which has $22 billion to deploy -- are a likely sourceof funds.
Candente's shares weretrading flat at C$2.13 on Wednesday afternoon on the Toronto StockExchange. The stock has risen nearly five-fold in the past year.
($1=.9919 Canadian Dollar)
(Reporting by Arnika Thakur in Bangalore; Editing by Unnikrishnan Nair)