Freeport to start $4 billion Peru’s copper mine expansion in 2013
Freeport-McMoRan Copper & Gold (NYSE: FCX) will start its $4 billion mill expansion at the Cerro Verde copper operation in Peru next year, said CEO Richard Adkerson a conference call to discuss second quarter results published Thursday.
The improvements would expand the concentrator facilities from 120,000 metric tons of ore per day to 360,000 metric tons of ore per day. It would also provide incremental annual production of approximately 600 million pounds of copper and 15 million pounds of molybdenum beginning in 2016.
Asked about recent protests in Peru against mining companies, Adkerson said the company has “found a way to have very good relations with the communities and with the local government."
He added that Freeport's experience in working with authorities and communities in Indonesia was helpful when addressing similar issues in the South American country.
"Even before we started out on the expansion we were working more aggressively with the people of Arequipa," Adkerson said.
Cerro Verde, which is 53.56%-owned by Freeport, produced 151 million pounds of copper in the second quarter of this year, down from 170 million pounds in the same period of 2011.
The US-based company operates other three copper mines in South America, all located in Chile: Candelaria, Ojos del Salado and El Abra.
Peru is the world's second biggest producer of copper and silver and a major producer of gold, zinc and lead. The country’s extractive sector accounts for 60% of the economy.