Chilean miner Antofagasta has reported a 2% increase in annual copper production last year to 660,600 tonnes thanks to strong performances by its largest mines Los Pelambres and Centinela.
The company, which operates four copper mines in Chile, said output at Los Pelambres increased after overcoming water supply issues at the operation, which is in the midst of a multi-billion expansion.
Water is needed in copper smelting, and in the concentrator, which breaks down raw ore and processes it into usable material.
Chief executive Iván Arriagada said the company is finalizing the delivery of the first phase expansion project at Los Pelambres, which will help to maintain the asset’s future production.
Arriagada highlighted the recent approval of a second concentrator at Centinela, which will provide an additional 170,000 copper-equivalent tonnes of production.
He also mentioned the acquisition of a 19% interest in Peruvian copper producer Buenaventura, which has seven mines in the home country. The precious and base metals producer also holds a 19.58% interest in Cerro Verde, one of the world’s largest copper mines, in a partnership with Freeport-McMoRan and Sumitomo.
Antofagasta, majority-owned by Chile’s Luksic family, one of the country’s wealthiest, kept its full year production forecast for 2024 unchanged. It expects to produce 670,000-710,000 tonnes of copper and 195,000-210,000 gold ounces this year. That compares to 660,000 tonnes of copper in 2023, reflecting a successful planned increase in production.
Copper prices continued to show stability last year and Antofagasta expects that given the metal’s fundamental role in the energy transition and electrification, prices will remain solid in the long-term.
Analysts at BMO Capital Markets concur. “We believe that improving copper markets over the next few years and the highest production growth in our coverage will allow for EBITDA to double,” they wrote in a note this week.
Estimates predict a shortage of the metal starting this year as some factors have reduced the available supply. Panama shut down First Quantum Minerals‘ mine, which produces 350,000 tonnes of copper, and two major producers, Anglo American and Vale’s base metals unit cut their output estimates for 2024 and 2025.
