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Chile : US$4bn funding gained by Codelco

August 2, 2014

Chile's government is backing state copper producer Codelco with up to US$4bn for the 2014-18 period.

The funding comprises US$3bn from government debt issues and US$1bn from the company's pre-tax profit, Chile's finance minister Alberto Arenas was quoted as saying in a government release.

The funds will be distributed yearly and linked to production and efficiency goals set in the company's 2014-18 business and development plan.

President Michelle Bachelet will set up the capitalization in a bill that will be sent to congress this month.

Chile's copper workers federation FTC, Codelco's main union, has appreciated the decision as "it gives clear support to the ambitious and unprecedented investment plan that will support Codelco Chile for the next 50 years."

Codelco is spending approximately US$23bn in five structural projects that will assist the company maintain present production levels. The projects are the new Ministro Hales division, the underground transformation of Chuquicamata, a new mine level for El Teniente, and the Andina 244 and RT Sulfuros expansion projects of its Andina and Radomiro Tomic divisions, in that order.

The union in addition admired the end of the uncertainty surrounding Codelco's leadership after the board appointed Nelson Pizarro as new CEO.

Codelco is the world's biggest copper producer.

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Source: TendersInfo (India)

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