Global miner Rio Tinto Ltd is ready to commit funds for an exploration drive in Central Asia that it hopes could unearth the world's next giant copper deposit, a company official told Reuters.
The company hopes to start drilling in Uzbekistan this year and is ready to proceed with a joint venture in Kazakhstan to explore multiple copper targets, Rio Tinto's general manager for exploration in Central Asia Chris Welton said.
"We are looking for an Oyu Tolgoi," Mr Welton said in an interview, referring to the Mongolian deposit set to become one of the world's biggest copper mines outside Chile.
Kazakhstan, a former Soviet republic five times the size of France, holds three per cent of the world's recoverable oil reserves as well as large deposits of copper and other industrial metals.
But the geologists who mapped the region in Soviet times were not counting on copper prices that set record highs above $10,000 a tonne this year.
Mr Welton said Central Asia could hold much greater, deeper reserves than those already mapped.
"Ideas have moved on. Technology has moved on. We are looking to apply that here in Kazakhstan," he said.
With regions such as South America, the United States and the Pacific rim well explored, Welton said relatively unmapped regions such as Central Asia were the next big frontier.
"The big new discoveries that are going to make a big difference for a company like Rio, and also for copper supply, are beginning to come out of frontier terrains," he said.
"We look at Kazakhstan and say: 'The geology's right. It's got great potential and there's been very little modern exploration done'.
Rio Tinto is awaiting the approval of state-owned miner Tau-Ken Samruk to begin work on a 50-50 joint venture to explore a region of Kazakhstan, within which it plans to identify target areas for drilling.
The two companies signed a memorandum of understanding last year, but delays to the final agreement have meant Rio Tinto has reallocated its $US3.5 million (A3.29 billion) Kazakh exploration budget for 2010.
"Quite rightly, Kazakhstan is taking its time on this agreement. This will be a precedent agreement, the first one that Tau-Ken signs, so they want to get it right," Mr Welton said.
"We also want to get it right, but we also want to start spending," he said.
"If we get a deal signed this year, we will put the licence applications in immediately."
Rio will fund exploration until resources and reserves are registered with the state, at which point the joint venture partners would fund development of any mine on a pro rata basis.
"If we get a decent-sized, high-quality set of targets, I would've thought we would be looking at a minimum spend of somewhere around $10 million next year," Mr Welton said.
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