Polish state-owned mining company KGHM expects to begin production at Sierra Gorda copper mine in Chile later this month.
The company plans to produce 110,000t of copper this year and increase it to 217,000t by 2018. The mine will also produce 11,000t of molybdenum a year.
KGHM CEO Herbert Wirth was quoted by Reuters as saying: "Construction is finished. I think that this month we’ll see the first production of copper ore, and maybe we’ll also see the first sales."
The company came to own the unfinished mine in 2012 as part of its acquisition of Canada’s Quadra FNX. The project is 55% owned by KGHM and 45% by Japanese firm Sumitomo.
Located in the Antofagasta Region in northern Chile, Sierra Gorda is considered to be having the world’s fourth largest deposits of copper.
The open pit mine is expected to hire more than 2,000 permanent employees and nearly 7,000 contract workers.
The development of the mine has cost KGHM more than $4bn, exceeding its estimates, at a time when the world copper prices have witnessed a downward trend.
KGHM, Europe’s second largest copper producer, plans to scale up its production by 40% to one million tonnes a year, the news agency reported.
Last week, the company has signed a $2.5bn five-year revolving credit deal to finance its mining projects. A part of it will be used to refinance $700m debt of its overseas arm KGHM International.
KGHM International also owns projects in Germany, Canada and the US.
Image: Sierra Gorda mine in Chile has the fourth largest copper deposits in the world. Photo: courtesy of KGHM International.