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OZ Minerals Says It May Halt Work on $2.8 Billion Copper Project

May 27 (Bloomberg) -- OZ Minerals Ltd., Australia’s third-biggest copper producer, may halt work on its Carrapateena project if it’s unable to attract a development partner.

The Melbourne-based producer has offered tours and presentations to as many as 12 groups potentially interested in taking a stake in the South Australia deposit, which has a planned development cost of A$3 billion ($2.8 billion), it said last month. Those contacts haven’t yet become a formal sale process, Chairman Neil Hamilton said today at an annual meeting in Melbourne.

“We are open to all options, which might include placing the project effectively on care and maintenance and not incurring any material expenditure until we find the right outcome that fully benefits our shareholders,” Hamilton said.

OZ Minerals can’t fund the project alone, according to Hamilton. The producer’s cash balance, which according to data compiled by Bloomberg fell to A$364 million at the end of December from A$1.3 billion in December 2010, will further drop when the company reports earnings to the end of June, he said.

Carrapateena, acquired in 2011 for $250 million, may contain as much as 6.3 million tons of copper and 8.4 million ounces of gold, according to a November filing. OZ Minerals last year delayed exploration work amid rising costs.

To contact the reporter on this story: David Stringer in Melbourne at dstringer3@bloomberg.net

To contact the editors responsible for this story: Jason Rogers at jrogers73@bloomberg.net Indranil Ghosh, Iain Wilson

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