(Updates with comments from Hernandez on Anglo American dispute in ninth, 10th paragraphs.)
Nov. 25 (Bloomberg) -- Codelco, the world’s largest copper producer, reported a 3.5 percent increase in production at its Chilean mines through September.
Output in the first nine months of the year rose to 1.25 million metric tons from 1.21 million tons in the same period last year, according to a statement distributed today at the state-owned company’s headquarters in Santiago.
Increases at the Andina and Radomiro Tomic mines offset more than 22,000 tons in lost production caused by strikes including stoppages by contractors at its El Teniente mine, Chief Executive Officer Diego Hernandez told reporters. Annual output will be “a little more” than 1.7 million tons, he said.
Including its share of the El Abra mine, owned by Freeport McMoRan Copper & Gold Inc., Codelco produced 1.29 million tons in the first nine months compared with 1.26 million tons a year earlier. Codelco didn’t give separate third-quarter results.
Andina and Radomiro Tomic’s nine-month output rose 31 percent and 26 percent, respectively.
While the copper market will be volatile this year, China continues to grow at a “strong” pace and the company’s negotiations with clients have “gone well,” Hernandez said.
The longer term demand outlook continues to be “promising,” while suppliers are facing a challenging environment to increase output, the company said in a statement posted on the Chilean securities regulator’s website today.
Codelco has budgeted about $20 billion this decade to boost annual production to more than 2 million tons.
Codelco is fighting a legal battle with Anglo American Plc in its bid to exercise an option to acquire up to 49 percent of the London-based company’s Sur assets.
Hernandez said any talks with Anglo would involve Codelco buying a stake in the unit. Negotiations would have to “respect” Codelco’s option, the exercising of which would create $3.7 billion in value, he said today. Anglo hasn’t contacted Codelco to begin talks, he said.
--With assistance from Philip Sanders in London and James Attwood in Santiago. Editors: James Attwood, Dale Crofts
To contact the reporters on this story: Sebastian Boyd in Santiago at firstname.lastname@example.org; Matthew Craze in Santiago at email@example.com
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