Glencore informed CST on Tuesday that it was unable to reach a satisfactory commercial agreement with Korea Resources Corporation and LS-Nikko Copper, which hold the remaining 30% of the project.
 
The termination comes after Glencore and CST extended the original deadline by eight weeks in order to satisfy the conditions.
 
Glencore had already completed due diligence on the project.
 
Hong Kong-listed CST had planned to use the proceeds to further its Lady Annie mine in Queensland and pursue other projects, as well as possibly returning funds to shareholders.
 
The company said it would continue to explore its options in relation to the project, but said the termination of the sale would not have any material effect on its business or the project.
 
CST acquired the project in the $C244 million takeover of Toronto-listed Chariot Resources last year, which acquired it from Rio Tinto in 2004.
 
Construction on the $US745 million project is set to begin shortly and is slated to deliver 110,000 tonnes per annum of copper concentrate and cathodes over an 11.5-year mine life, starting in 2013.
 
The project contains 6.8 billion pounds of contained copper and has been declared by the Peruvian government as a project of national interest.
 
On Tuesday, CST posted a six-month loss of $81.9 million.