UPDATE 1-Quadra Mining in Talks to Sell Part of Project

TORONTO, March 2 (Reuters) - Quadra Mining (QUA.TO) is in talks to sell half of its Sierra Gorda copper project in Chile, and aims to have a deal in place by mid-2010, the company's chief executive said on Tuesday.

The news helped drive Quadra's shares up by 7.2 percent.

Speaking at the BMO Capital Markets Metals and Mining conference in Florida, Paul Blythe said the company was talking to two or three potential partners on a deal that would help relieve the funding burden of the $2 billion-$2.5 billion project.

Quadra started the search for a partner after copper prices plunged in late 2008.

The company released a scoping study last July that forecast a 25-year mine that would produce between 250 million and 400 million pounds of copper per year, along with 33 million pounds of molybdenum over its first eight years.

Quadra is seeking a deal even though it has yet to release a feasibility study, which would provide more data on the viability of the deposit and likely drive up the asking price.

"We've taken the view that we really need to seriously look at a partner now rather than later," Blythe said.

He said a deal would likely involved only one partner and would likely be for about half of the project.

Quadra's talks have involved "a number of entities including the major (mining companies) and different Asian trading houses, state enterprises," he said, adding that a deal could be done in the first half of the year.

Quadra runs three mines in the United States and Chile, and also owns the Malmbjerg molybdenum project in Greenland. Quadra expects to produce 250 million pounds of copper this year.

Its Toronto-listed shares were up C$1.07 at C$15.87.

($1=$1.03 Canadian)