Home Commodities Codelco in talks for new copper smelter, chairman says | Hotter Commodities

Codelco in talks for new copper smelter, chairman says | Hotter Commodities

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According to Máximo Pacheco, the talks are part of an ongoing series of discussions with interested parties toward the company’s aim to replace its Ventanas smelter, which was closed last year.

“We have had several meetings with different investors located in different parts of the world who are very interested in securing concentrate supply for their operations. We have concentrates, and we have them here in Chile, so interested parties have contacted us to see how we can support the project of building some new smelting capacity in Chile,” Pacheco said.

“We have assured them that, as Codelco, we are prepared to supply concentrates in Chile for that project. This week will be a good opportunity to make some progress in this conversation,” he added during an interview in the annual CESCO industry week.

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Commissioned in the 1950s, Ventanas was suspended several times during its history for alleged emissions of sulfur dioxide and arsenic. An agreement was eventually reached with workers on retirement and relocation terms, leading to its closure in June 2023.

A year ago, Fastmarkets reported that Chinese metals giant Minmetals and South Korean copper producer LS MnM had each shown interest in constructing and operating a new smelter in Chile.

The last smelter constructed was Xstrata Copper’s Altonorte plant in 1993, which is now owned by Glencore. Pacheco said that Codelco was very aware of the requirements for a new smelting project, based on its 52-year history of producing copper in Chile.

“We know the country and the landscape very well. We know where you could develop a smelter, considering factors such as concentrate availability, infrastructure, ports, labor, weather conditions, while ensuring a positive impact on the environment and communities,” he said.

“Finally, a big project like this would require a lot of permits, and we have also an expertise on this. Considering all these factors, we can help a smelter to happen,” he added.

The tightness in the spot concentrate market has left many copper smelters, particularly in China, scrambling to source units. Typically, tighter spot supply leads to a drop in spot treatment and refining charges (TCs/RCs), which are the fees mining companies pay smelters to have their semi-processed ore – or concentrate – turned into finished metal.

Spot TCs have plummeted in recent months following a series of supply disruptions and lower-than-expected production.

Fastmarkets calculated the weekly copper concentrates TC index, cif Asia Pacific at $0.10 per tonne on Friday April 12, a record low, down by 95.65% week on week from $2.30 per tonne.

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