Chile blackout affects miners, copper production impact seen limited

SANTIAGO, July 3 Thu Jul 3, 2014 11:48am EDT

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SANTIAGO, July 3 (Reuters) - Operations at some of Chile's largest copper mines were affected to some extent for a few hours by a power outage in the country's mineral-rich north, industry sources said on Thursday, though the actual impact on production could not be quantified.

The blackout, which started on Wednesday, affected the regions of Arica y Parinacota, Tarapaca and Antofagasta, home to some of the largest copper mines in Chile, the world's top producer of the red metal.

These include state-owned Codelco's Chuquicamata, Gabriela Mistral, Ministro Hales and Radomiro Tomic mines, the massive Escondida mine, run by global miner BHP Billiton , and the Collahuasi mine, a partnership between Glencore Plc and Anglo American Plc.

"Operations at all of Codelco's north divisions were affected, but it was for a relatively short period of time ... for around two to three hours," said a source close to the state-run miner and the world's largest copper producer.

"The impact on production has not been quantified," the source said.

According to the latest available information, by midnight power was re-established for all of the area's urban areas and to 65 percent of its industrial clients, which includes miners, a regulatory official said.

A new estimate of how much power has been turned back on is expected by midday.

"After the power outage that affected three of the country's regions ... backup generators started operating immediately at Collahuasi, allowing us to continue operating some of the mine's basic processes and basic services at the camp site," said a spokeswoman for Collahuasi.

"Yesterday evening power supply was completely turned back on and normal operations were re-established at the company," the spokeswoman added.

The power cuts also briefly impacted operations at Antofagasta's northern Chile operations, including Minera Centinela and Michilla, though backup generators kept critical parts of the operation online.

"The lull (in operations) during the blackout are totally recoverable, so the production of Minera Centinela and Michilla will not be impacted," the company said.

A nebulous regulatory framework and drawn-out legal battles have left several major power generation projects in limbo, at the same time that public opposition to large coal-fired plants and hydropower projects has grown.

The crunch has left major copper mines short of power and is putting at risk billions of dollars in mining investment over the coming years.

"I am not sure how the various companies have reacted (to the power outage) but one thing is certain: power availability is a problem in Chile," a source at a mining company operating in Chile said. (Reporting by Anthony Esposito and Fabian Cambero in Santiago, Silvia Antonioli in London; Writing by Anthony Esposito; editing by Matthew Lewis)

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