Billionaire Alisher Usmanov's Metalloinvest has won the right to develop Russia's largest untapped copper field and pledged on Wednesday to invest over $3.9 billion to become a top 10 global producer within a decade.

    Metalloinvest, founded and half-owned by Usmanov, said in a statement it would team up with state conglomerate Russian Technologies to develop the Udokan field in eastern Siberia and would consider inviting more partners to the project. "The acquisition of the licence to develop the Udokan copper field turns Metalloinvest into the owner of one of the world's largest copper reserves," the company said in the statement.

    The contest for Udokan, which pitched Metalloinvest against the state railway monopoly after all other bidders withdrew, was unexpectedly brought forward by a week. The field is considered strategic by the Kremlin, thus off-limits to foreign ownership.

    Russian subsoil agency Rosnedra, the division of the Natural Resources Ministry which organised the tender, was unavailable for comment. Norilsk Nickel, which has been mentioned as a possible partner, declined to comment on the result.

    Analysts said the size of the project, which could boost Russian copper output by at least 15 percent, requires major investment, while its strategic nature made it likely that a state-friendly enterprise would emerge as the licence owner.

    Usmanov met Russian President Dmitry Medvedev in a televised meeting on Tuesday to discuss his iron and steel projects, although neither made any reference to the Udokan deposit.

    Russian Technologies, which will own at least 25 percent of the consortium to develop the project, is headed by Sergei Chemezov, a close ally of Prime Minister Vladimir Putin.

    OUTPUT COMMITMENTS

   Metalloinvest said the planned investment in the project would exceed 100 billion roubles ($3.9 billion). The company, which bid through its iron ore-mining subsidiary Mikhailovsky GOK, also agreed several conditions related to the project.

    It plans to start construction of a hydrometallurgical complex at the Udokan field in 2010. The first section, with capacity to produce 150,000 tonnes a year of copper cathode, will be put into operation as soon as 2014.

    Full capacity of 474,000 tonnes a year of copper cathode will be reached by 2016. The plant to process the ore and refine copper cathode, as well as rolling 63,000 tonnes a year of copper wire rod, will be built in the town of Yasnogorsk.

    Metalloinvest must also prepare an assessment of the resource within 18 months of the licence registration, with reserves to be confirmed within 30 months.

    The only other bidder at the tender was the Russkaya Med (Russian Copper) consortium comprising state-owned Russian Railways and Urals Mining and Metals Co, Russia's second-largest copper producer after Norilsk.

    Both consortium members declined to comment.

    Another bidder, the mining division of billionaire Oleg Deripaska's Basic Element company, withdrew from the tender on Tuesday, saying it would be "economically inexpedient".