Southern Copper to resume Tia Maria project in Peru as permit imminent
Southern Copper Corp (NYSE:SCCO), the world's fifth largest producer of the red metal in terms of output, said Friday it hopes to soon resume work at its $1.4 billion Tia Maria project in Peru, as its expects the government to give it a long-awaited construction permit in the first quarter of 2018.
Reporting results for the three months to September, the Arizona-based company said net profit doubled in the period to $401.8 million compared to the same quarter a year earlier.
Earnings before interest, tax, depreciation and amortization increased 58% to $863.1 million, when compared to the same three months last year.
The miner, a subsidiary of Grupo Mexico, attributed the positive results to higher copper prices, which offset a decline in output.
Southern Copper produced 675,759 tonnes in the first nine months of 2017, down 2.1% from the same period last year.
But the company is betting on the imminent completion of its $1.2 billion Toquepala mine expansion, also in Peru, to boost production. Southern said the project would add 100,000 tonnes of copper to its annual production to reach 1 million tonnes of copper production capacity per year.
It also has high hopes for its Tia Maria mine, which is forecast to produce 120,000 tonnes of copper a year, for an estimated 20-year lifespan.
The project run into fierce community opposition as locals worried about its environmental impacts, so the company had to halt construction in 2015. Support for the project in the southern region of Arequipa has since grown, Southern said, adding that it's working with authorities to obtain the final licence.
Once it receives such permit, Southern said it would take two years to build the mine.