Antofagasta is betting on copper, gold and steel-essential metal molybdenum this year, as the mining giant swallows spiralling costs of its latest Chilean project.
A review of the Los Pelambres expansion project, which is now more than 70 per cent complete, has spiralled from $1.7bn (£1.3bn) to $2.2bn (£1.6bn), as the miner shoulders Covid-19 costs and battles with inflation.
The London-listed miner reported that copper production was in line with expectations, but gold mining fell by more than a third, with molybdenum also trailing behind last year’s figure, in its first quarter.
However, CEO Ivan Arriagada said the markets have been strong throughout the quarter, “and we expect this to continue as structural supply and demand dynamics support a tight physical market.”
Copper mining is anticipated to be at its lowest in the first quarter, but is expected to ramp up by each quarter, the company said in a statement.
The Chilean miner expects to dish out around $1.9bn (£1.4bn) in expenditure in 2022, at the top end of the previously forecast $1.7bn to $1.9bn range.
The London-headquartered firm exited its contentious project in Pakistan in a $900m (£684m) deal earlier this month, after the site was suspended in 2011 due to a dispute over the legality of the licensing process.
Antofagasta said it has agreed a deal with Canadian partner Barrick Gold Corp and authorities in Pakistan to end its involvement in the Reko Diq copper and gold mine project.