July 29 (Bloomberg) -- OZ Minerals Ltd., which operates the A$1.2 billion ($1.07 billion) Prominent Hill mine in Australia, wants to add copper assets to give it a second source of production.
"We have a business development team who are working around the clock to identify these opportunities," Chief Executive Officer Terry Burgess said today at a briefing in Sydney. Melbourne-based OZ has looked at three or four projects in great detail, Burgess said, without identifying them.
Demand for copper is increasing, with the three-month London Metal Exchange price trading 32 percent higher than a year ago. OZ Minerals, which this month used part of the A$1.1 billion cash on its balance sheet at the end of 2009 to buy a 19 percent stake in Sandfire Resources NL for A$100 million, on July 15 approved a A$135 million underground development at Prominent Hill.
OZ is "content" with the size of its stake in Sandfire, which gives it a slice of the De Grussa project in Western Australia's Mid-West region, Burgess said.
"We have been asked why we didn't take over the whole company," Burgess said. "While there are always strategic reasons that are difficult to go into, I liken our approach here to a marathon or a half marathon, not a 200-meter sprint."
OZ shares gained 2.5 percent to A$1.22 cents at 2:33 p.m. in Sydney.
Demand for copper may decline as China, the world's biggest user, shows signs of slowing down, Burgess said, citing a recent visit to the country.
"For the first time since I have been visiting China, I came back with a view that there may be a slowing of the economy there which could affect demand," he said, according to a transcript of his speech filed to the Australian stock exchange.