Compañía Minera Antamina announces expansion of its operations
- Investment will increase processing capacity by 38%, increase reserves processed by 77% and increase mine life by 6 years
- Investment will positively impact income taxes over the medium and long term, as well as generate construction and permanent jobs and increase local purchasing.
- The investment represents the single largest private investment project to be implemented in Peru in 2010.
Compañía Minera Antamina SA today announced an investment of US$ 1288 million to expand the mining and processing facilities at its mine site located in the San Marcos District, Province of Huari, Ancash Region. In 2008 the firm announced a 77% increase of its mineral ore reserves at the mine site; the new mineral reserves were incorporated into a feasibility study completed in 2009, which enabled them to study options for the expansion announced today.
The expansion of reserves will include increases to mineral ore processing capacity, which will rise by 38% to 130,000 metric tons per day, increase the reserves processed by 77% to 1.1 billion tonnes and increase the mine life until the year 2029. This extension of the mine’s useful lifespan adds significant value to the project, and represents a significant achievement for the company which has been making improvements to the efficiency of its operations by way of different project initiatives in recent years. The mine expansion means that the company will acquire new mining equipment, enlarge its truck workshop, expand its concentrator plant, build a new 55 km electric power transmission line, and enhance its current water management and tailings storage systems.
Within the context of a post economic-crisis, this expansion represents the largest private investment to be executed in Peru in 2010, demonstrating Antamina’s confidence in the country and its commitment to long term development, through the decision of Antamina´s shareholders to approve this very significant investment in Peru. Ian Kilgour, President and General Manager of Antamina, pointed out that higher levels of mineral production will generate more revenues which will therefore bring about the payment of more income taxes over the medium to long term to the federal government, half of which is returned to the Ancash region as mining canon royalties to be used for local and regional public infrastructure construction projects. Over the life of the project it is projected that taxes paid would increase by US$ 1800 million, and mining canon to the region would increase by US$ 900 million. “In addition, it will generate other benefits such as 2,726 jobs in the construction stage, and over 500 additional permanent positions, mainly for local area residents, and would increase local purchases and service contracts in the country by 37%» he said. «Without a doubt, the mine’s expansion will bring greater benefits to stakeholders and to the mine’s surrounding communities; and it is a sign of investor confidence both in the company and in Peru,» he commented.
Compañía Minera Antamina SA is a corporation formed in Peru, governed by Peruvian law, which started operating in 2001 and represents the largest single private investment in the history of mining in Peru. It produces copper and zinc concentrates with lesser quantities of molybdenum and lead / bismuth concentrates. Its shareholders are four leading companies in the international mining industry: Xstrata (33.75%), BHP Billiton (33.75%), Teck Resources (22.5%) and Mitsubishi Corporation (10%). The company is recognized for implementing a Social Responsibility policy as an integral component of managing its business. Between 2005 until 2008, Antamina has paid US$ 2 billion in taxes; of this amount, 50% has returned to the region and local municipalities as mining canon royalties. In 2007, with voluntary contributions, the company established the Antamina Mining Fund which now holds resources of US$ 163.9 million that are being invested in projects in the areas of health and nutrition, economic development, infrastructure, education and institutional capacity building.
Lima, January 5th, 2010
Corporate Affairs Department
Compañía Minera Antamina S.A.
For further information, please contact: Gonzalo Quijandría, Corporate Affairs manager Telephone: (511)217-3092 E-mail: email@example.com