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Chilean drought forces Antofagasta to lower copper production target
2022-05-04

Chilean miner Antofagasta (LSE: ANTO ) said on Thursday that due to climate change exacerbating a decade-long drought, Chile’s water shortage has forced it to cut its copper production target for this year.


The miner now expects to produce 710,000 to 740,000 tons of copper this year , which is lower than the previous forecast of 730,000 to 760,000 tons.


Antofagasta is building a desalination plant, will be 2 022 start operations in the second half year is expected to reduce the risk of water shortage.


The public Division said its flagship Los Pelambres desalination plant mine redesign may also be affected, the mine planned for 2022 second half began operations, the delay will allow 50,000 at risk of tons of copper production.


Los Pelambres, located in the Coquimbo region of Chile , 240 kilometers northeast of Santiago , is one of the company's drought-affected businesses. In the past 20 years, only the central region of the country, where most people live and where the main copper mines are located, has reduced rainfall by nearly 30% .


Despite the weather-related challenges, Antofagasta (Antofagast A) six months earnings jumped to a record 24- billion, due to strong copper prices boosted its bottom line. The soaring metal prices also allowed the company to declare an interim dividend of 23.6 cents per share , more than three times the dividend a year ago.


Although the first half of this year the average copper prices, but due to a stronger dollar weighed on investor sentiment, the metal Zhou Si since hitting a low of more than four months on the London Metal Exchange.


LME three-month copper fell 0.4 percent to a tonne 9,009 dollars for 4 Yue 14 lowest level since May, then rebounded to a tonne 9,045 dollars almost flat.


CEO Ivan · Arriagada said in a statement that the first half of central Chile unprecedented weather dry, almost no drop of rain. We have now experienced 12 years of drought. The precipitation in 2021 has so far been less than in 2019 , and 2019 itself is one of the driest years on record.


However, Antofagasta key growth projects are on track, Arriaga said the company remains focused on operational discipline law and cost control.