UPDATE 2-Southern Copper says 3rd-qtr profit fell 25 pct

* Net sales fall 20 pct on lower metals prices

* Quarter production up, costs down

* Company says expects to have enough cash for projects (Adds quotes, project details, investments)

LIMA, Oct 22 (Reuters) - Southern Copper Corp (PCU.N) (SPC.LM) said on Thursday its third-quarter net profit fell 25 percent to $312.5 million from $417.8 million in the year-ago period as prices for metals fell.

Net sales in the quarter were down 20 percent to $1.15 billion, from $1.44 billion a year ago.

The company, one of the world's largest copper producers, said sales were lower because of lower prices, but that production was up and costs were down.

Copper production rose 1.3 percent in the quarter to 120,240 tonnes, while molybdenum output climbed 14.3 percent and zinc production was up 3.5 percent in the same period.

The company, a unit of Grupo Mexico (GMEXICOB.MX), said total costs in the quarter fell 15.8 percent to $643 million.

"We believe the forecast for the copper market is strengthening for the next few years and we expect more improvement in our results," German Larrea, president of Southern Copper's board, said in a statement.

Among the projects the company said are progressing are its Toquepala expansion and the Tia Maria development in southern Peru.

The company has approved a $934 million investment program, and has spent about $250 million on it so far.

Toquepala and Tia Maria are expected to add 40,000 tonnes and 120,000 tonnes of copper respectively, once operational.

Tia Maria is scheduled to start production in the second quarter of 2011, while construction at Toquepala is set to begin in the middle of next year.

"We've revised our cash flows for the next few years and, under current conditions, we expect to have sufficient cash flows generated internally to continue with the projects," said Larrea. (Reporting by Patricia Velez and Dana Ford; Editing by Marguerita Choy, Gary Hill)