Codelco and Anglo American Plc are exploring options to coordinate mining activities at their adjoining copper operations in Chile in a bid to boost output and productivity, people familiar with the matter said.

Talks are focused on enabling Codelco’s Andina mine and Anglo’s Los Bronces to tap rich ore grades sitting between the two operations, as well as processing Andina ore at Los Bronces plants, according to the people, who asked not to be identified discussing private information.

Any agreement would be limited to operational collaboration rather than ownership changes. State-owned Codelco and London-based Anglo declined to comment.

The two neighboring mines high up in the Andes mountains above Santiago have long discussed sharing infrastructure as well as site access and have already signed some easement and sustainability agreements. Those discussions were halted during a protracted permitting process to add underground operations at Los Bronces, which has now been resolved.

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Mining companies around the world are forging partnerships to bring down costs and boost output as mines and projects get trickier and pricier at a time of lingering supply chain disruptions, inflation and construction bottlenecks. In March 2023, Glencore Plc boss Gary Nagle spoke about the benefits of combining mines that are located next to each other but owned by different companies.

Motivation for Andina and Los Bronces to reach an agreement may be high amid declining ore quality, water restrictions and greater scrutiny of environmental and social issues. For Codelco, it could also offer some production upside after the company’s output slumped and costs surged.

Codelco already owns an indirect stake in Los Bronces. In a 2012 deal, Anglo reduced its holding in its Sur unit that owns Los Bronces to 50.1%, while a venture between Codelco and Mitsui bought 29.5%.