SANTIAGO Dec 1 (Reuters) – Chile’s government will give state-owned copper miner Codelco $975 million in capitalization so the cash-strapped firm can finance its ambitious investment plans, Finance Minister Rodrigo Valdes said on Thursday.
World no.1 copper producer Codelco returns all its profits to the state and is funded by a mix of capitalization and debt.
“This year the government has decided to capitalize Codelco with $975 million … this money will allow the company to continue developing its investment program,” Valdes said at a news conference. Last year, the government handed Codelco $600 million.
Codelco wants to invest $18 billion through 2020 to revamp and expand its existing mines in order to keep copper output flowing. It had previously planned to invest upwards of $25 billion, but was forced to slash that because of a falling copper price.
Codelco Chief Executive Officer Nelson Pizarro said the capitalization would allow the company to make progress with its projects, which include the transformation of Chuquicamata, the century old biggest open pit copper mine in the world, into an underground mine.
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