Aluminum and Copper

Expecting an increase in the production cost of the Escondida copper mine in the current fiscal year

Expecting an increase in the production cost of the Escondida copper mine in the current fiscal year
Mining News Pro - New labor contracts signed by the union and Escondida mining administration in recent days will increase copper production costs in the world`s largest copper producer, but the managers say they are looking for a solution to reduce costs.

According to Mining News Pro - Peter Bivan, managing director of BHP Billton, owner of Escondida, said: "Given the agreement reached between the trade union and mine management over the wage rate and taking into account the reduction of more than 15% of the level of ore, it is expected that the production costs of each unit in the fiscal year The current price will increase by $ 0.04 per pound ($ 88.2 per tonne). "BHPBillton`s fiscal year starts on July 1st.

However, due to an increase in the use of desalted water, more pressure has been put on production. According to the company, improving labor productivity and optimization strategies for maintenance operations will compensate part of the increase in costs.

The financial director of BHP Billton also announced that after publishing 2018 financial results, the company will maintain the production costs of Escandida at $ 1.15 per pound of copper ($2535.2 / t).

On the other hand, the statistics show that the cost of producing each unit in the Escondida mine during the 12 months ended June 30 was $ 1.07 per pound of copper content ($ 2359 / t), due to the adverse effects of the exchange rate and general inflation, The previous forecast of $ 1 per pound of copper ($ 2204.6 per tonne) has been rising.

"A new contract has been signed with the union on wages," said Bloomberg CEO Andrew McKean. However, it is possible to make some changes to the agreement, which means that the company will be able to reduce its production costs. In addition, the change in working practices will allow the company to continue to increase its production efficiency in the Escondida mine, and thus ensure that, despite the reduction in the level of ore deposits, the mine is a good place to invest. "

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