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Chile’s Codelco reports Q1 pre-tax profit down 29%

Chile’s Codelco, the world’s largest copper producer, on Friday posted a 29% drop in its pre-tax profit for the first three months of this year, landing at $849 million amid setbacks and delays in launching key projects.

The state-owned miner said output totaled 295,000 metric tons, down 10% from the same period last year. Including production from its stakes in Freeport’s El Abra and Anglo American Sur, it said, production amounted to 319,000 tons.

Codelco has been battling to boost its production, which has fallen for two straight years to reach a quarter-century low, despite delays, cost overruns and accidents.

The company said a rock burst at its flagship El Teniente mine last year had “translated into a smaller area to mine,” also attributing the decline to a temporary stoppage due to fatal accident at its Radomiro Tomic, geological limitations at its Minister Hales site and start-up delays at Rajo Inca.

Production costs, however, shrunk 5% to $1.939 per pound, the company said, as it benefited from lower energy and fuel prices, a more favorable exchange rate, lower operational costs and a build-up of inventories.

Codelco had provided an estimate for its production figures earlier this month, with Chairman Maximo Pacheco saying recovery was underway.

Last month, the company forecast that it will at least match the prior year’s production for 2024, with output between 1.325 and 1.390 million tons.

Mining Minister Aurora Williams said in an interview this month that April numbers are expected to be lower than expected after a worker died in an accident at the Radomiro Tomic mine, shuttering production for a few days.
The company’s output of the red metal key to industrial use, especially for electrical wiring and electric vehicles, fell 8% last year compared to 2022 production.

Along with its focus on copper, President Gabriel Boric has tasked Codelco with spearheading the state’s role in mining lithium, a battery metal also key to the energy transition, via majority stakes in projects in two of Chile’s most lithium-rich salt flats.
Source: Reuters (Reporting by Fabian Cambero and Daina Beth Solomon; Writing by Sarah Morland; Editing by Kylie Madry and Aurora Ellis)

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