SANTIAGO – Chile’s Corporacion del Cobre, or Codelco, the world’s largest copper mining firm, said it planned to cut investment by up to $4 billion.
“We envision investment, taking into account the drop in the peso against the U.S. dollar, that will be below the $25 billion level. The final figure could be between $21 (billion) and $25 billion,” Codelco CEO Nelson Pizarro said in a press conference on Monday.
The press conference was held after a special Codelco board of directors meeting that included government officials.
“We have asked for some additional information from the company before making a decision on capital investment in the next few days. Codelco is the state’s most important company and we will always support it,” Finance Minister Rodrigo Valdes told reporters.
“We want to capitalize Codelco so it maintains a healthy balance sheet,” Valdes said.
Mining Minister Aurora Williams, for her part, noted that Codelco “accounts for 10 percent of global production (of copper) and has 8 percent of the world’s copper reserves.”
Codelco’s management said the investment cuts were a response to the drop in copper prices, which have fallen 17.7 percent since January.
Codelco is the world’s largest copper mining company, producing 1.84 million tons of fine copper, or 10 percent of total world output, in 2014
Revenues from copper sales are crucial for the economy of this South American country of 17.6 million people.