Codelco, the world’s biggest copper producer, is nearing a deal to acquire Lithium Power International Ltd. that could value the Sydney-listed firm at nearly A$315 million ($202 million), according to people familiar with the matter.

The Chilean state-owned firm is in advanced discussions to buy out Lithium Power at about 50 Australian cents per share, representing a 43% premium to its Wednesday closing price, the people said. The companies are working on finalizing a deal, they said.

An announcement could come as soon as next week, one of the people said, who asked not to be identified as the information is private. Negotiations could still be delayed or even fall apart, according to the people.

Shares of Lithium Power surged as much as 25.7% and touched the highest level since February on Thursday before trading was halted. The stock is still down about 6% this year, giving it a market value of about $168 million.

Lithium Power said in a Thursday statement that the potential price of about 50 Australian cents per share is incorrect, without further elaboration. Discussions with Codelco are ongoing and no agreement has been reached, it said. A representative for Codelco declined to comment on Wednesday.

Lithium Power has projects in Chile and Australia, according to its website. Its Maricunga project, located within the so-called lithium triangle in northern Chile, is estimated to contain about 1.9 million tons of lithium carbonate equivalent. The firm’s projects in Western Australia are still in exploration stage.

Acquiring the Australian miner, with its Chilean asset, would bolster the state-owned firm’s position in the country’s lithium industry. Chile has given Codelco a key role in a new public-private model for the sector, under which the state will have a majority stake in areas considered nationally important. Codelco’s chief financial officer is moving to a new job with responsibility for lithium, the firm’s chairman said in an interview this month, a day after the company abruptly announced the finance chief’s resignation.

Codelco has been struggling with copper mine mishaps and project delays while its debt load has been piling up. Moody’s Investors Service earlier this month cut its investment-grade credit rating by one notch and assigned a negative outlook.

Codelco’s production slump has set up a three-way battle for the title of the world’s largest copper miner. Freeport McMoRan Inc. briefly took the top spot from Codelco last year, and BHP Group Ltd. is also challenging it for the mantle after buying Australia’s OZ Minerals Ltd.

(Updates with Lithium Power’s statement in fifth paragraph.)