• Seen as miners with the biggest exposure to crude oil
  • WTI at two-week highs on expectations refinery demand is up

Freeport-McMoRan Inc. and Teck Resources Ltd., punished in the stock market for expanding into oil before prices tumbled, rallied on Tuesday as crude jumped to a two-week high.

Shares in Freeport surged 6.9 percent to $12.64 at 11:51 a.m. in New York while Teck, Canada’s biggest diversified miner, rose 9.4 percent to C$8.27 in Toronto. They were the best performers in the Bloomberg Americas Mining Index. Both shares are down 54 percent in the past year, compared with the index’s 31 percent decline.

Copper miner Freeport invested heavily in oil and gas in 2013 with the acquisitions of McMoRan Exploration Co. and Plains Exploration & Production Co., swelling its debt just ahead of a downturn in energy prices. Teck has energy exposure through the proposed Frontier oil sands mine, and via a 20 percent ownership in the Fort Hills oil sands project, both in Northern Alberta. It’s shouldering 20 percent of costs in the latter project, estimated at C$13.5 billion in total.

“Among the miners, they have the most exposure to oil,” Daniel Rohr, an analyst with Morningstar Inc. in Chicago, said in a telephone interview. “Given the extent to which that’s leveraged on their balance sheets, that’s magnified.”

Oil climbed to the highest since Oct. 19 in New York, ahead of a report Wednesday which is expected to show higher refinery utilization rates.

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