MercoPress. South Atlantic News Agency

BHP Billiton reactivates mining projects in Chile

The Chilean subsidiary of Australian mining giant BHP Billiton plans to reactivate projects worth 6.75 billion US dollars that were frozen last year amid the global recession.

The news was announced by executives of Minera Escondida in a statement published Monday in the newspaper Diario Financiero, which said the decision was in line with the drop in costs for inputs such as steel and reinforced concrete and with the improved outlook for mining in general.

The projects involved include the building of a 3.5 billion USD water-desalinization plant serving the Escondida mine, located some 180 kilometres southeast of the northern city of Antofagasta, and 3.25 billion expansion of mining operations at the site.

Carlos Mesquita, president of Escondida, said that the more positive context for the sector means the company is “seriously” reconsidering when these projects can be reactivated, before the end of the 18 month suspension that the company originally announced.

“The desalinization plant and Phase 5 were stopped...but we’re seeing that inputs are coming down in price and I firmly believe we’re going to restart those projects sooner,” the executive said.

Mesquita said that this year Escondida’s copper production estimates are in the range of 1.05 million to 1.2 million tons. Chile is the world’s No. 1 producer and exporter of copper.

Investment in domestic copper and gold projects through 2013 is expected to total roughly 30.28 billion US dollards the Chilean Copper Commission said earlier this month, forecasting that domestic production of the red metal would rise to 6.3 million metric tons per year by 2015, 18.8% more than last year’s 5.3 million metric ton.