Chile’s Codelco is fine-tuning details of a new plan to tackle the almost yearlong delay in a project to turn its century-old Chuquicamata open pit mine into an underground operation.
Chief Executive Officer, Nelson Pizarro, told El Mercurio (in Spanish) it would present the so-called “46/49 joint initiative” to the company’s board of directors during a meeting scheduled for later in the month.
In December, Codelco’s board of directors approved $3.3 billion in investments on top of the $900 million it has already spent in the underground project, a record-high for the state-owned company, which is the world’s largest copper producer.
The move is expected to open the way to the exploitation of nearly 1.7 billion tonnes of mineral of copper and molybdenum for an additional 40 years period starting from 2019.
Chuquicamata is Codelco’s main division, accounting for over 40% of the miner’s total production in 2014. Just three years earlier, though, the division situated in Calama, north Chile, accounted for nearly 51% of Codelco’s total copper output.
The company is in the midst of executing a $25 billion investment plan aimed to expand its decades-old flagship mines and search for new high-grade deposits.
Copper, which accounts for 60% of Chile’s exports and 15% of gross domestic product, has lost 11% of its value during the past year. Only yesterday it traded at three-week lows Wednesday after data showed China’s economy grew at the slowest pace in six years.
The industrial metal will avoid following oil and iron ore into a more dramatic drop as an anticipated surplus is erased by mine setbacks, mining executives including Antofagasta’s (LON:ANTO) CEO Diego Hernandez and Teck CEO Don Lindsay told the World Copper Conference in Santiago.