TOKYO (Reuters) - Japanese copper miners JX Nippon Mining & Metals and Sumitomo Metal Mining plan to increase output from their mines in Chile this year, but are facing challenges in bringing them to full capacity and meeting profit targets. JXTG Holdings Inc said on Friday that Caserones copper mine which is 51.5 percent owned by its metal unit JX Nippon Mining is expected to produce about 110,000 tonnes of copper concentrate in the year to end-March 2019, up from 91,000 tonnes a year earlier.
The projected annual output still falls short of the 150,000 tonnes target planned when the company started construction of the mine.
Output at the Caserones mine, located in the arid mountains of northern Chile, has fallen behind schedule since it started producing in May 2014, plagued by a series of technical problems in its ramp-up stage.
JXTG posted 125 billion yen ($1.14 billion) in impairment losses for the mine in the year ended March 31, bringing its total impairment loss on the mine to 273.3 billion yen.
Mitsui Mining and Smelting Co Ltd which owns 25.87 percent stake in the mine has booked an impairment loss of 79.7 billion yen in total. Mitsui & Co which holds 22.63 percent stake in the mine has taken a total impairment loss of 95.7 billion yen.
But JX expects the mine to turn profitable in the second half of the current financial year, Senior Vice President Katsuyuki Ota said.
Caserones is not the only Chilean mine that is running behind schedule.
Japan’s Sumitomo Metal Mining (SMM), which reported its earnings on Thursday, said it plans to increase copper concentrate production to 101,000 tonnes in calendar 2018, up from 97,000 tonnes in 2017, at its Sierra Gorda mine in Chile which has encountered a series of technical challenges.
SMM, which owns 31.5 percent in the mine, has posted a total impairment loss of 147.3 billion yen by end-March 2017 and still expects 14 billion yen loss from the mine in the current financial year, the miner’s Executive Officer Masahiro Morimoto said.
Sierra Gorda is 55 percent owned by Polish miner KGHM and 13.5 percent by Japanese trading house Sumitomo Corp.
The problems at the mines highlight the challenges faced by miners in the country as they sift through far-flung locations as more accessible deposits have largely been tapped out.
Reporting by Yuka Obayashi and Osamu Tsukimori; Editing by Vyas Mohan