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4 Copper Mine Expansions in Chile Facing Delays

Mining News - Published on Tue, 26 May 2020

Image Source: Copper Mining Chile
BNAmericas reported that the expansions of Antofagasta Minerals Los Pelambres, Teck Resources Quebrada Blanca phase II and Codelco’s Inca Pit and Andina concentrate is facing delays

LOS PELAMBRES - Construction started in February 2019 with an original capex of USD 1.5 billion and was advancing according to schedule. To avoid infections, the miner suspended agreements with contractors for up to four months, affecting 55 companies from Los Vilos and Salamanca towns in Coquimbo region. So far, about 2,000 of 4,922 subcontractors are receiving a monthly salary of at least 500,000 pesos, avoiding layoffs. According to Antofagasta Minerals, the expansion would generate around 9,000 indirect jobs in the region. After the suspension, the company reduced capex by USD 200,000 and has yet to announce a restart date.

QUEBRADA BLANCA PHASE II - Teck’s USD 5.2 billionn Quebrada Blanca phase II in Tarapacá region, was suspended after having reached 29% of progress. Expected cost impact will be USD 75-125 million during the first four weeks. Any additional suspension will cost USD 25-50 million per month with a four-week delay over the original plans. Production start-up was planned for 4Q21, but the eight weeks of suspension, with 15,000 workers demobilized, will affect the date. In March, the company upped capex by USD 500 million due to contingencies such as the exchange rate, permitting issues and Chile’s social unrest.

ANDINA - This is one of the structural projects state copper miner Codelco aims to complete within the next 10 years. Capex fell from USD 1.48 billion to USD 1.3 billion due to design simplifications. When works were suspended in mid-March, they had reached 83% progress and start-up was planned for end-2020. The project includes a new crushing line and ore transportation system.

INCA PIT - Originally planned to be ready during 1H20, the US$1bn project in Atacama region is also part of Codelco’s structural works. It will extend the Salvador division’s operations and received the Atacama environmental commission’s approval in February. It will create 2,000 jobs during the construction stage and 400 once production starts. Contracts with around 15,000 subcontractors where suspended in April due to the pandemic.

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Posted By : Yogender Pancholi on Tue, 26 May 2020
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