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Anglo American unveils $3 billion project to bolster Chile copper output

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Anglo American unveils $3 billion project to bolster Chile copper output

Santiago — Anglo American is seeking approval for a $3 billion investment to support production at its Los Bronces copper mine in central Chile, the company said Friday.

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Los Bronces Integrated project will develop two new areas in the existing open pit and develop a new underground operation at the site located high in the Andes Mountains above Santiago, the Chilean capital, according to an environment impact study filed Friday.

Lea la noticia en español.

"The LBI project will replace some of the lower-grade resources currently mined with better-quality ore mineral with the aim of maintaining the deposit's current production levels," Anglo American said in a statement.

Los Bronces produced 369,500 mt of copper in concentrates last year, making it one of the world's largest copper mines.

The mining giant said it had spent six years studying the project and three years consulting with local communities to ensure a design would not affect surrounding glaciers, increase water use, or raise traffic levels on local roads, among other potential impact.

"This process led us to rule out project alternatives that were more economically profitable for the company, but which did not meet the criteria we set for ourselves," said Ruben Fernandes, the company's CEO-Base Metals.

The constraints reflect tougher demands placed on mining companies operating in Chile, where water has grown scarce and environmental regulation tougher.

Legislation currently in Congress would strictly protect the country's glaciers from human activity, like mining.

Anglo American said that the underground mine, which will exploit major mineral discovery made earlier this decade, is partially located hundreds of meters below a local nature sanctuary.

To avoid any impact on the surface, the company will employ a mining technique known as sublevel stopping with backfill in which extracted ore is replaced with waste rock and aggregate materials.

Although new to Chile, it has been successfully used in many countries, including Australia, Canada, Spain, and Sweden.

"By utilizing this method, almost 30% of available ore will not be extracted, making it three times more expensive than other alternatives, such as open pit or underground block caving operations," Anglo said.

Anglo American owns 50.1% of Anglo American Sur, which owns the Los Bronces and El Soldado mine and the Chagres smelter, all located in central Chile.

The rest of the shares are owned by Chile's state copper producer Codelco (20%), Japanese trading house Mitsubishi (20.4%), and Mitsui (9.5%).

-- Tom Azzopardi, newsdesk@spglobal.com

-- Edited by Valarie Jackson, newsdesk@spglobal.com