Kazakhstan's Eurasian Resources Group put Bamin up for sale last year, attracting interest from a consortium led by mining giant Vale. The consortium also includes local mining company Cedro Mineração and development bank BNDES.

"At this moment, I would say the most critical factor in advancing this transaction is Vale's decision. As the consortium leader and a large publicly traded company, Vale has a somewhat slower decision-making process. That said, it is indeed possible that a decision on the acquisition will be made in the coming months, in the first half of this year," the source said.

If the negotiations succeed, Vale would take a controlling stake in Bamin, holding between 50% and 60%. Cedro Mineração would own up to 30%, with the remaining share held by BNDES.

The acquisition would be valued at approximately US$1.2bn.

"The Brazilian government has expressed support for the negotiations, which facilitates BNDES's participation," the source added.

The government also wields some influence over Vale, particularly as the Luiz Inácio Lula da Silva administration wants to see Vale investing more in Brazilian assets and projects.

This week, representatives from the companies involved in the negotiations met with Brazilian government officials, including mines and energy minister Alexandre Silveira, during the Future Minerals Forum in Saudi Arabia.

BNDES's involvement in the discussions and the consortium is particularly important as the bank can provide financing for Bamin's logistics projects.

In 2022, Bamin announced plans to invest 20bn reais (approximately US$3.3bn) to develop the Pedra de Ferro mine and the supporting logistics network, including FIOL (the east-west integration railroad) and Porto Sul.

Faced with rising project costs and challenges in securing funding, Bamin's current shareholder began considering selling the asset.

When contacted by BNamericas for comments, Vale and Bamin did not immediately respond.

• [Editor:Alakay]