With no recovery in sight, lithium prices force miners to reevaluate output
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Among major plans to upgrade its aging mines, Codelco plans to expand the world’s largest underground copper mine, El Teniente (“The Lieutenant”).
Export Development Canada (EDC) said Wednesday it has granted a US$300 million loan to Chile’s owned copper producer Codelco to help it with a much needed massive investment program aimed to guarantee the firm’s status as the world’s biggest copper producer.
As part of the agreement, the Chilean miner will procure goods and services from Canadian companies down the road, particularly small-to-medium sized enterprises.
“Such loans have been very productive in the past, especially with Codelco, where they have helped promote Cdn$888 million worth of purchases from more than 150 Canadian companies in the last five years,” a spokesman for EDC told MINING.om.
Jean Cardyn, EDC’s Regional Vice-President in South America said in a statement that the Canadian trade finance agency has identified Chile as a market that holds tremendous promise and potential for growth.
Late last month President Michelle Bachelet enacted a special law to spur the company’s output, which grants Codelco an extra injection of S$4 billion between 2014 and 2018.
The Santiago-based company, struggling with aging mines and depressed copper prices, is also planning to sell about $8 billion of bonds over the next five years to help finance a nearly $30bn investment program and so maintain its status as the world’s biggest copper producer.
It is estimated that Codelco holds about 9% of the world’s known proven and probable reserves and roughly 11% of the global annual copper output with 1.8 million metric tons of production.
Image courtesy of Codelco.
2 Comments
Mark
Should make the loan contingent on Chile not unduly interfering/harassing Barrick on the Pascua Lama project with invented/fake reasons to stall the project.
Christian Combes
Cecilia Jamasmie, I have a particular and interesting question/observation to make. I myself am very much involved in the Chilean Mining industry – and have been living in Chile for the past decade. The more and more I read “International” News reports regarding Coldelco’s 10+ year Plan to re-structure its aging Mines to maintain production, it comes to my attention that the international media constantly makes erroneous statements regarding the expansion plans for 2 of Codelco’s Main Copper Mine Projects. El Teniente is currently a VERY large underground copper mine project, and the plans are to make it an even LARGER underground mine project with further extraction deeper than currently being tunneled – hence the commonly used term “NNM” (Nuevo Nivel Mina) aka New Mine Level which specifically insinuates the deeper new mine tunnels that are already being worked on to further expand the El Teniente mine tunnels deeper underground. El Teniente is NOT going to become an open-pit Mine Operation (as constantly proclaimed by all international press) where as if you were to read local Mine Press you’d see that there is NO mention of El Teniente becoming an Open Pit Operation.
Likewise for the other LARGE Codelco Mine Project. Chuquicamata (the largest Open Copper Pit Mine in the southern hemisphere, and maybe the world) is experiencing a shortage of Copper resources and if nothing were to be done about it, Chuquicamata would be forced to close within the next 5yrs. As an approach to extend its life-cycle, and part of this multi-billion re-structurement Plan, Codelco will convert Chuquicamata from a World-class Open Pit Mine, to an underground Mining Operation. This inversed mine style of operations will mean many complications for the Chuquicamata mining personnel since they currently have little to no knowledge as to how underground mining operations differ from open-pit mine ops. However, the recently appointed Codelco Gnrl. Mngr./CEO – Nelson Pizarro – has made it quite clear, that if Chile wants (and its needs!!) Chuquicamata to remain operational and equally productive, then this open-pit mine needs to tunnel for more mineral reserves, which there are, but harder to attain via the traditional open-pit mining style.
I sincerely hope this information may help better understand how or why it is that the international Mining Press (and not only Mining.com, but many others as well) are constantly making erroneous assumptions as to how Codelco will proceed with its multi-billion re-structurement plan, which not only includes El Teniente going deeper underground, and Chuquicamata going from Open-pit to soon to be underground, but as well as plans to improve Radomiro Tomic and El Salvador Mine sites.