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Energy, water issues weigh on Chile’s mining industry

Keywords: Tags  Chile mining, mining investments, aluminum, copper, Cochilco, Maria Cristina Betancour, Rene Muga, Codelco BHP Billiron

SÃO PAULO — Chile is expected to receive about $104 billion in mining project investment over the next 10 years, of which about $80 billion will go toward copper projects, the Chilean Copper Commission (Cochilco) said.

The new projects will lift annual copper output capacity by about 50 percent to 8.4 million tonnes per year.

As new projects are developed, energy demand will increase. Chile’s energy needs for the mining sector are expected to rise by 68 percent over the next decade.

"The main problem is the cost that companies will have to bear for thermic electricity generation, a scenario in which Chile is affected by international prices for fuels, as they are mainly imported," Cochilco director of studies María Cristina Betancour told AMM sister publication Metal Bulletin.

"I don’t believe Chile will be without energy for its projects, but the costs for obtaining it will certainly rise," René Muga, general manager of Chile’s energy producers’ association, said.

Other problems relate to the scarcity of water for mining in the northern part of the country, where large projects such as Corporacion Nacional del Cobre de Chile’s (Codelco’s) Chuquicamata and BHP Billiton Plc’s Escondida are located.

"Besides sea water, which is already used in some projects, other methods of water supply are being evaluated," including transporting water from Chile’s south-central zone to the north, where resources are scarce, Betancour said.

A version of this article was first published by AMM sister publication Metal Bulletin.

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