SANTIAGO, Chile Copper
mining projects are facing increased delays due to cost
overruns, among other factors, according to Jay K. Grewal,
Capstone Mining Corp.s senior vice president of strategy
and stakeholder affairs.
Only 11 of the 22 projects in
the "highly probable" category in 2007 have actually made it
into production, she said at London-based CRU Groups 12th
World Copper Conference in Santiago. "The remaining 11 were
pushed out by between six and 11 years."
The postponements are often due
to estimates of the projects capital expenditures running
about 40 to 50 percent over the original figures, she said, but
the market also is facing a talent vacuum, with engineering,
procurement and construction companies stretched, and long lead
times for certain items contributing to construction
Columbia-based Capstone is a base metals mining company focused
mainly on copper, with operations in Yukon and Mexico and
development projects in British Columbia and Chile.
Like other mid-tier companies,
Capstone is looking for strategic partners to strengthen its
balance sheet and the markets for its products, Grewal said.
"Our focus is on the Americas, but (target markets) could be
Eastern Europe for other companies, for instance. We dont
have the ability to absorb a $2-billion hit."
Midsize companies such as
Capstone also are adopting a more multifaceted approach to
their social licenses to operate, becoming more integrated into
project development planning and engaging with communities at
Major mining companies
divestment of scale-producing assets opens up an "opportunity
to acquire de-risked, cash-flow-producing assets and an
improved capacity to absorb project development," Grewal