BLM wrote:

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By Ichiro Suzuki and Masumi Suga

Oct. 1 (Bloomberg) -- Sojitz Corp., a Japanese trading company, and Nittetsu Mining Co. gained approval from Laos to explore for copper as demand for the metal increases.

The companies will explore the Moune district near the Thai border, about 100 kilometers (62 miles) west of the capital Vientiane, Tokyo-based Sojitz said today in a statement. Sojitz and Nittetsu Mining are the first Japanese companies to gain the right to explore for the metal in Laos, the statement said.

Japanese companies are vying with overseas rivals to secure resources and diversify supplies on speculation global demand for raw materials will increase, fueled by growth in China. Gold and copper account for more than half of Laos’ exports, which make up about a third of the country’s economy.

“Copper is an indispensable metal used in infrastructure, cars and consumer durable goods and a high growth rate for demand is expected, mainly from emerging markets,” Sojitz said. Bloomberg reported earlier today that Sojitz and Nittetsu Mining would win the exploration approval, according to four people involved in talks.

Sojitz gained 2.3 percent to 175 yen in Tokyo trading and Nittetsu Mining advanced 2.5 percent to 494 yen. The Nikkei 225 Stock Average fell 1.5 percent.

Japan imports 1.3 million metric tons of copper in ore a year, the world’s second-largest importer after China, and relies on South American production for 60 percent of its overseas purchases, according to the statement. Laos has more than 6 million tons of ore reserves, Sojitz said.

Price Doubles

Copper for delivery in three months on the London Metal Exchange has doubled this year fueled by China’s buying and speculation that a recovery in the global economy will increase consumption of raw materials. The metal traded at $6,156 a ton as of 3:31 p.m. Tokyo time.

Global copper demand is forecast to surpass 20 million tons in 2012, up from about 18 million tons currently, Sojitz said.

Pan Pacific Copper Co., Japan’s biggest smelter of the metal, plans to spend $1.86 billion on the development of a mine in Chile, the company said Sept 9.

To contact the reporters on this story: Masumi Suga in Tokyo at msuga@bloomberg.net; Ichiro Suzuki in Tokyo at isuzuki@bloomberg.net.

Last Updated: October 1, 2009 02:34 EDT

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