June 30, 2010 / 6:19 AM / in 7 years

UPDATE 1-China MCC: Afghan copper mine to start output in 2013

* Afghan copper project to start production in 2013

* Second phase expansion has set to 500kt from 200kt

* Seeking extension of a copper mine lease in Pakistan

By Polly Yam

CHENGDU, China, June 30 (Reuters) - An Afghanistan copper mine joint venture between Metallurgical Corp of China (MCC) (1618.HK) and Jiangxi Copper (0358.HK) is expected to start production of copper concentrates in 2013, an MCC executive said on Wednesday.

This is two year’s later than the end-2011 startup date stated in September by MCC president Shen Heting, but in line with a timetable given in March by Jiangxi.

The first phase of the Aynak copper mining project would have a designed annual capacity of 200,000 tonnes of copper in concentrate, said Zeng Tao, sales manager at MCC Tongsin Resources Ltd, the copper and zinc unit of the listed MCC.

“(Production) would take two to three years to reach the designed capacity,” Zeng told reporters on the sidelines of a lead and zinc trade summit in Chengdu city in the western province of Sichuan.

He said the annual capacity would be expanded to 500,000 tonnes of copper in the second phase, higher than previous capacity stated at 320,000 tonnes, but did not provide a timeframe for completion.

MCC (601618.SS) was also considering building a smelter at the site, he said, adding the firm was negotiating with the local government on details, including the size.

The sale of concentrate production from the Aynak project would be handled by the unit, Zeng said.

The Aynak mine, regarded as one of the major copper ore bodies in the world with proven reserves of 9 million tonnes of copper, is 75 percent owned by MCC and 25 percent by Jiangxi Copper (600362.SS), the top copper producer in China, the world’s biggest consumer of the metal.

PAKISTAN

A MCC majority-owned lead and zinc mine in Pakistan produced about 13,000 tonnes of zinc concentrates in the first half of the year and the material was sold to China, Zeng said, adding the firm had not sold lead concentrates due to small amounts.

The mine started production at the end of last year and has a designed capacity of about 70,000 tonnes of zinc in concentrate a year, he said.

MCC also operates a copper mine in Pakistan with annual production of 18,000 tonnes of copper, 2 tonnes of gold and 3 tonnes of silver, Zeng said.

A 10-year lease for the operation of the mine will expire in 2012 and MCC is in talks with the local government for an extension, he said.

Zeng said the lead and zinc unit was seeking to invest and develop overseas metals mining projects for MCC.

“We focus on the development of projects, not exploration as that takes 10 to 20 years and we don’t have the time,” he said, adding Beijing encouraged the firm to invest in overseas projects. (Editing by Michael Urquhart)

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