Codelco, Adani Sign MOU to Explore Copper Projects

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Written by Amir Richani for Industrial Info Resources (Sugar Land, Texas)

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Summary

The Indian and Chilean companies signed an agreement to explore three projects in Antofagasta and Atacama. The agreement follows a recent Indian government report outlining the nation's policies to increase its influence in the copper sector.

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The Codelco-Adani Agreement

Codelco (Santiago, Chile), the state mining company of Chile, signed a memorandum of understanding (MOU) with Kutch Copper, a subsidiary of the Adani Group (Gujarat, India), to jointly explore three copper projects in the Antofagasta and Atacama regions.

The agreement includes the exchange of technical and legal information on the projects, while Kutch will also conduct the due diligence required to evaluate the partnership.

"Together, we intend to leverage our combined expertise to sustainably meet the growing global demand for copper," said Máximo Pacheco, chairman of the board of Codelco.

India is Extending its Copper Influence

This agreement takes place a few months after the Indian government published its vision document for the copper sector, which outlined policy recommendations to increase copper production, mitigate the Asian country's exposure to supply chain bottlenecks, and increase its influence in the sector.

India relies heavily on copper imports to meet its demand, with roughly 90% of its copper concentrate needs met by imports. Last year, India was the sixth-largest importer of Chilean copper, with 209,000 tons, a 106% increase from 2023 volumes, according to Cochilco, the Chilean mining authority.

India's vision document proposed acquiring and investing in copper projects in copper-rich countries such as Chile, Peru, Australia and others, as well as developing offtake agreements with such nations to ensure supply. The plan also encouraged partnerships with companies like Codelco "to establish their smelters, refineries, and other downstream industries in India."

Codelco as a Copper Powerhouse

Codelco, the world's largest copper producer, has seen its copper production decline in recent years from a high of 1.79 million metric tons in 2011, due to delays in its structural projects aimed at increasing production, and operational setbacks. Yet, based on Cochilco's numbers, the company was able to arrest its production declines last year, producing 1.42 million tons of copper.

Through September this year, the company is averaging volumes 2.7% higher than last year despite the July accident at its El Teniente mine, which shut down the asset for days.

Key Takeaways

• Codelco and Adani Group agree to explore copper projects in Chile.
• The agreement follows the Indian government's efforts to increase its influence in the sector.
• Codelco is the world's largest copper producer, with an output of 1.4 million tons last year

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