Spotlight: Chuquicamata transformation

As part of the transformation process that Codelco's Chuquicamata division is undergoing, current installed infrastructure should allow an increase in productivity and a drop in costs, said CEO Nelson Pizarro during the Chilean state copper giant's 2017 results presentation.

The Chuquicamata underground project is 51.3% complete, including the main access tunnel and the construction of 96km of a total of 140km tunnels. Capex is estimated at US$4.2bn and the project is due to be completed before end-2019.

However, Chuquicamata should implement significant changes in its business model to increase productivity and reduce costs, Pizarro said.

The mine, in northern Antofagasta region, produced 311,000t of copper in 2017.

"We need to develop management plans, rather than investment plans to maximize the technical limits of our concentrator, smelting and refinery units ... This should be simultaneous with the billions of dollars that are being invested to develop an underground mine. They are inseparable," the CEO said.

The plan is to increase productivity from 44t/y to 61t/y of fine copper per worker. C1 costs should be reduced from US$1.29/lb to less than US$1/lb per pound, situating the mine in the first quartile, he said.

The concentrator should move from processing 176,000t/d to 210,000t/d, Pizarro said. "Our task is to stabilize and increase this daily processing and maintain our costs at US$7.3/t of processed mineral."

The smelting unit should comply with Chilean law D.S 28 on reductions of arsenic and sulfur emission, he added. "This is a law, there is nothing to do but comply with it, capturing 95% of sulfur and 95% of arsenic from 2019 onwards." Smelting costs will still be high but can be reduced from US$350/t processed to less than US$200.

A million tonnes a year of concentrates are currently processed at the smelter and the plan is to get to 1.4Mt/y, while the refinery's capacity should rise to 500,000t/y of cathodes from 350,000t, Pizarro said.