Codelco updates investment plan

Chilean state copper giant Codelco redefined the total investment for its two main projects, Chuquicamata Underground and El Teniente New Mine Level.

Codelco confirmed to BNamericas that it presented an updated investment plan to Chilean copper commission Cochilco. The new plan includes US$5.5bn for Chuquicamata Underground, up from the US$3.5bn expected in 2014, and US$5bn for El Teniente New Mine Level, up from the US$3bn approved in 2011.

Total required investments for both projects rose therefore by 62%.

The New Mine Level project is six to seven years behind schedule, due to the rock bursting methodology, while Chuquicamata Underground is two to three months behind schedule, said Codelco's CEO Nelson Pizarro during a presentation, local newspaper Pulso reported.

Asked by BNamericas about the investment portfolio for the next five years, Codelco said it estimates a capex of US$21.3bn from 2018 to 2022, including US$7.3bn (34%) for structural projects.

For 2018, the company forecasts a capex of about US$4bn.

FORMOSA BOND

Codelco broke ground in Taiwan's Formosa market as it placed a US$600mn bond.

The rate on the coupon is 4.85% with a 30-year maturity, Codelco said in a press release.

This is the first bond a Chilean corporate entity emitted in the Formosa market and the first Codelco bond that can be repurchased at the same original value from the fifth year of issuance until the end of its life.

"This operation will allow reducing the short-term and medium-term financial burden, optimizing the debt maturity profile, making it more consistent with the generation of expected cash flows from the investment plan", said Codelco.