Freeport-McMoRan Poised to Become World's Biggest Copper Producer
Codelco's reign as the number one copper producer appears to be coming to an end.
U.S. based mining company Freeport-McMoRan, which currently owns the largest gold mine in the world, is forging ahead with plans to ramp up production with a $4.6 billion expansion at the Cerro Verde mine in Peru next year.
According to Bloomberg, the move will solidify Freeport in closing the gap with current world number one Codelco as well as place the company in a position for future dominance.
“They are making the right bet,” said Christopher LaFemina, an analyst at Jefferies LLC, who recommends buying Freeport stock. “If you are going to be leveraged to a commodity price, this is the right one. If you compare to iron ore or coal, copper is better.”
The timing of the expansion is rather surprising.
Anglo American and Teck Resources have postponed future investments as prices for copper continue to decline and Codelco is in the midst of executing its own expansion project, a $25 billion investment to expand its aging mines and search for new high-grade deposits.
The timing for the Chilean company may be a little too late. Freeport is expected to sell roughly 1.95 million tons of copper next year, compared to Codelco’s output of about 1.85 million. Even with Codelco’s record planned investment, the company’s production will only rise 10 percent as most of the spending will replace lost output, reports Bloomberg.
Freeport shares have lost 40 percent in the past six months and the company is one of the worst performing global mining companies tracked by Bloomberg.
Unmanned train to allow Vale to reopen iron ore plant
Brazilian miner Vale SA will be able to resume operations at its Timbopeba iron ore dry processing plant in up to two months thanks to the use of an unmanned train, the company said in a statement this week.
Vale - Timbopeba iro ore plant
With the train, Timbopeba will be able to operate at least at 80% of its capacity of 33,000 tonnes of iron ore “fines” per day, reports Reuters.
Vale was forced to shut down the plant in the Alegria mine complex recently after labor authorities in Minas Gerais state banned activities close to the Xingu dam due to concerns of a risk of collapse.
Vale said access by workers and vehicles continues to be suspended in the flood zone of the dam due to the ban even though it remains at emergency level 2, which means there no imminent risk of rupture.
But some workers are allowed entry under strict security precautions and they will get the unmanned train going once it has been tested, which would take between one and two months, the company said.
The unmanned train will travel automatically along 16 kilometers (10 miles) of track operated by a system that can control the speed and activate the brakes, Vale said.
Vale announces first ore at Voisey’s Bay mine extension
Vale has reached the milestone of first ore production at the Reid Brook deposit at the Voisey’s Bay mine expansion project in Northern Labrador, Canada - recognised as the safest mine in Canada.