LONDON – Chilean miner Antofagasta has approved the development of its $1.3-billion Antucoya copper project, and sold a 30% stake to Japanese trading house and long-time partner Marubeni to help shoulder the burden of rising costs.

Marubeni, one of several Japanese trading houses vying for supplies of physical copper in Chile, will pay $350-million for its stake and commit to funding its pro rata share of construction and development costs as the project evolves.

The trader is Antofagasta's partner on other operations such as its main Los Pelambres mine and flagship greenfield mine Esperanza.

Antucoya, a copper oxide deposit 45 km east of Antofagasta's Michilla mine, is expected to produce an average of 80 000 t of copper cathodes a year, and is part of a project pipeline that totals some $20-billion to the end of the decade.

"Antucoya represents another important step in the growth of the group, and should lift total group production to around 800 000 t of copper by 2015," Antofagasta Minerals CEO Marcelo Awad said in a statement.

"Despite recent volatility in commodity markets, we remain confident about the long-term fundamentals of copper."

Already set to cost more than expected, Antucoya has been cited by the company as an example of the escalating costs, from labour to power, that have plagued the mining industry across commodities and geographies.

It is the same size and uses the same technology as Antofagasta's producing El Tesoro mine - constructed a decade ago - and is also in the Atacama region, but will cost more than a billion dollars extra to build.

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