Japan-based Sumitomo Metal Mining (SMM) and Sumitomo Corporation have approved a $4.6bn Cerro Verde copper mine expansion plan in Peru.
Cerro Verde is an open pit copper and molybdenum mining complex located approximately 20 miles south-west of Arequipa, Peru.
SMM and SC hold a 21% equity interest in the Freeport-McMoRan copper and gold operated mine.
The company noted that it is willing to expand the annual copper production of the mine from 300,000t to 500,000t, following the completion of the on-going study.
The expansion plans for the project have been officially finalised and are slated for start-up in the first quarter of 2016
Following this, SMM will expand the project's concentrator capacity from the current 120,000t per day to 360,000t per day of ore, pushing annual production up by about 272,155t (600Mlb) of copper and 15Mlb of molybdenum.
Upon completion of due diligence, the company decided to approve the implementation of the project due to its high level of profitability.
Sumitomo stated that the mine will continue to be one of its main sources of copper production for a long time yet.
According to the energy and mines ministry, Cerro Verde is Peru's third largest copper mine and it produced 269,649t of copper and 3,982t of molybdenum in 2012.
The mine expansion plan is said to be part of Sumitomo's strategy to build-up its quality, non-ferrous metal assets.
Peruvian metals miner, Buenaventura, owns a 19.6% stake in the mine, while minority shareholders hold 5.9% and Freeport holds the remaining stake.
Image: Cerro Verde copper mine location. Photo: courtesy of Sumitomo Corporation.