Xstrata Increases Investments in Peruvian Copper Projects to $5.1 Billion

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Researched by Industrial Info Resources (Sugar Land, Texas)--Giant miner Xstrata plc (LON:XTA) (Zug, Switzerland) (LSE: XTA.L) announced major investments in the company's Peruvian copper mine projects, Las Bambas and Antapaccay, at the 29th Perumin - Convencion Minera, one of the most important mining conventions in Latin America, last month in Arequipa, Peru. Las Bambas is now expected to be worth $3.8 billion and Antapaccay is expected to be worth $1.3 billion, totaling $5.1 billion; previously, the two were thought to be worth $2.2 billion.

The Las Bambas project entails the construction of an open-pit mine and a 140,000-ton-per-day concentrator plant with two grinding lines. Mining operations are expected to produce 324,000 tons per year of copper, and 4,600 tons of molybdenum during a mine's life of 18 years. Las Bambas is in the city of Cotabambas, in the Apurimac region, some 150 kilometers from the Xstrata's fully owned and operational Tintaya mine. The company expects to complete a feasibility study in December and to present the environmental impact assessment to the Peruvian Authorities in mid-2010. Construction is expected to start at the end of 2011, with project completion set for the second quarter of 2014.

The Antapaccay project entails a smaller mining operation, with an open-pit mine and a 70,000-ton-per-year concentrator plant with one grinding line, designed to produce 160,000 tons per year of copper over 22 years. Antapaccay is just 12 kilometers from the Tintaya mine and is also known as the Tintaya mine expansion project. Tintaya is expected to close operations during 2013, when Antapaccay mine will be operational. The economic evaluation stage is being completed in the next few weeks and the construction is planned to start at the end of 2010. Bechtel Chile Limited (Santiago, Chile) is in charge of the feasibility studies for both projects.

Xstrata operates both projects though subsidiary Xstrata Peru S.A. (Arequipa, Peru). Also in Peru, Xstrata owns 33.75% interest in the joint-venture Compania Minera Antamina S. A., which operates the open-pit Antamina copper-zinc mine.

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