Pan Pacific Copper Continues Chilean Copper Project Despite Cost Change

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Researched by Industrial Info Resources East Asia (Kofu-shi, Japan)--In February 2010, Pan Pacific Copper Company Limited (PPC) (Tokyo, Japan), a joint venture between Nippon Mining and Metals Company Limited (TYO:5016) (Tokyo) and Mitsui Mining and Smelting Company Limited (TYO:5706) (Tokyo), announced plans to begin development of a grassroot copper mine in northern Chile. Originally intended to simply be an open pit copper mining operation in 2004, the project was placed on indefinite hold until it was purchased by PPC in 2006.

Once PPC began development of the Caserones project through its subsidiary SCM Minera Lumina Copper Chile (Santiago, Chile), the original $200 million in investment costs flared to nearly $2 billion as the company planned to add an extraction plant to the open pit mine. PPC received a $52.7 million loan from the administrative institution Japan Oil, Gas and Metals National Corporation (Tokyo, Japan) to aid in development efforts.

Site preparation began last April and construction officially began the following September with Fluor Chile SA (Santiago) heading engineering and construction. The mine is expected to produce approximately 1 billion tons of primary and secondary copper sulfide each year, which will go on to be used for the production of copper and molybdenum concentrates.

Copper oxide from the project, which will produce a total of approximately 300 million tons per year when the project is completed, will be used to produce approximately 30,000 tons of copper cathode per year. Copper cathode applications are extensive, including rechargeable batteries, semiconductors and solar panels, and the project is expected to begin production by the beginning of 2013.

Recently, PPC's parent companies, JX and Mitsui, announced that the investment value of the Caserones project is expected to climb. The Chilean peso has gained strength against the United States' dollar, pushing the project's investment value from $2 billion to $3 billion. PPC is continuing with the project and remains on schedule for completion in 2013.

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