Shareholders in both companies interviewed by Bloomberg said there was still likely to be some room for a sweetened offer before a May 22 cut-off.

The Indian mines ministry is also encouraging other state-owned companies to scout for critical minerals overseas.

Special licence is part of a wider deal that will see state-owned holding MIND ID become PT Vale’s largest shareholder, with 34% ownership.

Minas Gerais and Espirito Santo states have asked a court to order Vale and BHP to pay a total 100 billion reais.

The Resolution Copper project, a partnership between Rio and BHP, would supply more than a quarter of US copper.

Copper is the main driver of the company's profitability after it sold its steel-making coal business.

The mine, located in the state of Goias, is the company's first Brazilian operation.

The state-run copper miner is pushing to boost production up from its lowest in 25 years.