By Rob Delaney and Mark Herlihy

July 3 (Bloomberg) -- Teck Resources Ltd. Canada's largestdiversified mining company sold a 17 percent stake to China's$200 billion fund sovereign wealth fund for C$1.74 billion ($1.5billion) to reduce debt.

China Investment Corp. also known as CIC will buy 101.3million Class B subordinate voting shares for C$17.21 eachVancouver-based Teck Resources said today in a statement. Tecksaid the deal will give CIC a 6.7 percent voting interest.

Teck has sold assets to reduce debt after adding $9.8billion of loans last year to buy Fording Canadian Coal Trust aproducer of coal used in steelmaking. Teck last year sold morethan half of its coking coal production to Japan and Korea andrecently started selling to China the world's largeststeelmaker.

``For CIC it represents the opportunity to participate inthe inevitable upswing in commodities and for Teck CICrepresents a long-term patient investor that can also provideassistance in its largest market'' Scotia Capital a unit ofBank of Nova Scotia said in an e-mailed statement. Thetransaction is CIC's ``first major investment'' in a Canadiancompany.

Teck rose C$2.51 or 14 percent to C$21.01 at 12:46 p.m.in Toronto Stock Exchange trading. A close at that price wouldbe the biggest daily gain since April 21. The shares have morethan tripled this year.

Scotia Capital advised CIC on the transaction.

Coal Demand

Teck is betting that a ``strategic partnership'' with Chinamay help the company win a larger share of the country's cokingcoal imports which may rise to more than 20 million tons thisyear from 3.2 million tons last year Chief Executive OfficerDonald Lindsay said in a telephone interview.

``That's going to grow significantly in the coming yearsbecause they're building very large blast furnaces on theircoast'' Lindsay said. ``This could help us with ourmetallurgical coal sales in the long term.''

China is seeking access to raw materials for metalsproduction such as iron ore and coal. Wuhan Iron & Steel Groupoffered $400 million for part of Brazil iron-ore miner MMXMineracao e metalicos SA last month. Rio Tinto Group last monthscrapped a $19.5 billion investment plan from its biggestshareholder Aluminum Corp. of China.

Teck said May 27 it was in talks to sell coking coal assetsto Chinese companies to help it reduce debt and sold $4.2billion of bonds on May 5 to refinance short-term obligations.

Teck in April said it sold about 5.6 million shares ofKinross Gold Corp. for proceeds of about $101 million and agreedto sell its stake in the gold production from Cia. Minera Carmende Andacollo to raise about $270 million.

To contact the reporters on this story:Mark Herlihy in London atmherlihy1@bloomberg.net.Rob Delaney in Toronto atrobdelaney@bloomberg.net;