Chile’s Bachelet likely to name new Codelco chief next week

Chile's Bachelet likely to name new Codelco chief next week

Two names are being considered to replace current CEO Thomas Keller.

Chilean President Michelle Bachelet is said to be evaluating who the next leader of state-owned copper giant Codelco will be, and the announcement could come as early as next week, sources related to the matter told Thursday.

Bachelet, who is getting ready to take the podium on May 21, in a yearly speech traditionally used as a state of the nation address, is reportedly considering the nominations of Nelson Pizarro and Sergio Jarpa, both former Codelco executives, to replace current CEO Thomas Keller.

Chile's Bachelet likely to name new Codelco chief next week

Nelson Pizarro.

Pizarro (73), ex-member of the board of London-listed Antofagasta (LON:ANTO), is a mining engineer and has held various senior executive positions in the mining sector in Chile, both in project and operational roles.

He is, according to’s sources, the most likely candidate to assume the helm, but the bone of contention is his current position as CEO of Minera Lumina Copper Chile, which is constructing the polemic and delayed $4.2 billion Caserones copper mine, in the country’s north.

Caserones, one of the few new mining projects coming online in the South American country this year, has faced labour and environmental issues, some of which still have to be settled in court. Opponents believe Caserones, which went from a $3bn investment to a $4.2bn project under Pizarro, is a bad precedent if what Chile wants is to curb Codelco’s costs.

The other executive, Jarpa, has been linked to the mining industry for over 40 years. He has worked for companies such as Barrick, Chevron Mining and Phelps Dodge, and —in recent years—  he was the executive vice president of Codelco Norte, position he held until 2010. While he is frequently cited as an expert in copper, his nomination may prove problematic, as he is a major business partner of the rich Luksic family, which controls a sprawling collection of mines in the country.

Chile's Bachelet likely to name new Codelco chief next week

Sergio Jarpa.

The news comes on the heels of a major board shake-up, announced Monday (in Spanish), which saw Bachelet naming two economists and a lawyer to the board of directors.

Oscar Landerretche, a Massachusetts Institute of Technology-educated economist who was one of the main architects of Bachelet’s emblematic tax reform project, became the chairman of the board.

Economist Dante Contreras, who holds a doctorate from the University of California, Los Angeles, and lawyer Laura Albornoz, who received a doctorate from the University of Sevilla, were also tapped to join the nine-person board.

The names have been criticized for their lack of knowledge and involvement in the mining sector, reported (in Spanish). However, analysts recognize that the new directors will bring a close working relationship with the government, which could be key to Codelco’s plans, as it looks to secure funds for an overhaul of its ageing mines and for expansion projects.

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