Anglo American $3bn copper mine expansion on hold

Anglo American's $3bn proposed expansion of Los Bronces copper mine in Chile has been thrown into doubt after the Environmental Assessment Service of Chile (SEA) rejected the permitting application.

Anglo American said Los Bronces Integrated Project (LBIP) is a mine life extension project which expands the current open pit within Los Bronces’ operating site and replaces future lower grade ore by accessing higher grade ore from a new underground section of the mine.

The project uses the mine’s existing processing facilities, optimises water efficiency, and requires no additional water or tailings storage facilities. LBIP represents a significant investment in the future of one of Chile’s largest copper mines and is an example of modern mining where the full range of sustainability considerations have been consulted on and designed in from the outset.

The SEA has confirmed that LBIP satisfies all relevant environmental regulation but bases its adverse recommendation on "an alleged lack of information during the evaluation process to fully remove any doubts about a potential risk to public health," according to an Anglo American statement, which added that a decision on the LBIP permit application by the SEA is expected within the next week.  

Anglo American maintains all appropriate information has been provided throughout the evaluation process, and that this information has been appropriately socialised at every available opportunity within the regulated permitting process, including through formal meetings and via written submissions.

LBIP has been designed with the benefit of 10 years of scientific studies and a thorough and transparent consultation process with local communities and the relevant authorities. Mitigation measures will compensate for 120% of the emissions created by the project and Los Bronces’ current operations, both during construction and in operation, thereby improving local air quality.

The result is a project that has been configured specifically to protect the local environment, without any impact on biodiversity or on the nearby protected areas or glaciers, the company claims.

In the event of a negative decision from the SEA, the permitting process allows for further review to evaluate the full range of merits of the project alongside the technical permitting considerations.

"Anglo American is committed to following the established process and is working with the Chilean authorities to demonstrate that all potential impacts have been fully mitigated and to secure approval for the project," it stated.

Current copper production guidance in respect of 2022 and 2023 is unchanged. Production guidance remains subject to water availability and the ongoing effects of Covid-19.

Anglo American's Q1 production dropped 10% year-on-year as it was impacted by peak Covid-related absenteeism, high rainfall affecting operations in South Africa and Brazil, and safety and other operational challenges at metallurgical coal and iron ore operations.

Copper dropped 13% to 140kt and iron ore output fell 19%, but diamonds proved to be a noteworthy exception, with production jumping 25% to 8.9Mct (click here).