KEY POINTS
- Codelco’s chairman says private partners are the only way to sustain output.
- Output fell to about 1.2 million metric tons despite $32 billion in investment.
- The new target is an average of about 1.3 million metric tons a year.
Chile’s state-owned Codelco will keep losing copper output unless it teams up with private miners to develop new projects, board chairman Bernardo Fontaine said Monday, Reuters reported.
Speaking to local station Radio Duna, Fontaine said the company holds about 1 million hectares of unexploited mining concessions but lacks the capital and management capacity to develop them. “That is the only way it can grow, or even maintain, its production levels,” he said of partnerships.
Codelco chairman flags legal hurdles
However, laws that limit state-owned companies have made such deals hard to strike, Fontaine said, adding that the long, complex approval process scares off most potential partners. Even so, Codelco has already partnered with Rio Tinto and BHP.
The push comes after years of heavy spending. Codelco invested $32 billion over eight years, yet annual output fell from 1.7 million metric tons to about 1.2 million, Fontaine said, according to The Northern Miner. He also said company reports show its costs running 78% above comparable operations, Mining.com reported.
Lower targets after inflated figures
Meanwhile, Fontaine said new management has stripped out the excessive optimism behind previously inflated production figures. The company now aims for average annual output of around 1.3 million metric tons.
Preliminary findings showed irregularities inflated reported output by 42,100 metric tons across 2024 and 2025, and Codelco is weighing an inventory adjustment of $120 million to $140 million, The Northern Miner reported.
Also, Fontaine said Codelco cannot fund its investment pipeline, estimated at $34 billion, entirely from its own resources and would rather not take on more debt, according to Mining.com.
