Chile Congress OKs bill to free USD 1 billion for Codelco
Sunday, 11 Oct 2009
Reuters reported that Chile's Congress approved a bill that unlocks USD 1 billion in government financing to state miner Codelco to boost its investment in a year marked by price volatility.
As per report, the fresh financing will likely delay any plans to issue debt this year and help the state miner speed up projects to lift its dwindling output as copper prices recover. The bill, which was linked to a government USD 4 billion stimulus plan launched in January to battle the global crisis, overhauls Codelco's corporate governance in an effort to improve the efficiency of Chile's largest state company.
Mr Juan Carlos Guajarado head of Chile's copper industry think tank CESCO said that "This will not solve all of Codelco's problems but it's a crucial opportunity. It's a good chance for Codelco to turn more competitive and play as an equal with other big companies in the mining landscape."
Company sources said that the law languished for months in Congress, prompting Codelco executives to ponder a debt sale to finance investments in 2009. In June, Codelco registered a local debt shelf for around USD 400 million worth of bonds.
