Partners to expand Cerro Verde

The period ended Oct. 12 was another one of sideways chopping in the broad markets, with the Dow Jones Industrial Index falling 110.50 points to 10,077.18 and the S&P 500 index slipping 12.64 points to 1,121.84.

The most momentous mining decision was made by the second-largest copper producer, Phelps Dodge, which approved an US$850-million expansion at its 82.5%-owned Cerro Verde copper mine, near Arequipa in Peru. Through the expansion, some 1 billion tons of sulphide reserves averaging 0.51% copper will be processed through a new concentrator, and mine output will triple to 300,000 tonnes copper annually. Compania de Minas Buenaventura owns 9.2% of the mine, while the remainder is publicly traded in Lima. Buenaventura has agreed to boost its ownership in Cerro Verde up to a maximum of 20%, while Sumitomo Metal Mining Co. and Sumitomo Corp. have agreed to buy a joint equity position in Cerro Verde of 21-25%. In all, Cerro Verde expects to take in proceeds of US$400-500 million from the above transactions, with Phelps Dodge retaining a majority stake. For the period, Phelps Dodge fell US28 to US$91.74 while Minas Buenaventura fell US96 to US$23.99.

BHP Billiton will return up to US$2 billion to its shareholders, including an off-market stock buyback for Australian shareholders worth between US$700,000 and US$1.1 billion. Following the buyback, BHP will consider ways to return the balance of the US$2 billion to shareholders within 12 months. Options include more stock buybacks and higher dividends. BHP slipped US19 to US$21.44 on the week.

Print

Be the first to comment on "Partners to expand Cerro Verde"

Leave a comment

Your email address will not be published.


*


By continuing to browse you agree to our use of cookies. To learn more, click more information

Dear user, please be aware that we use cookies to help users navigate our website content and to help us understand how we can improve the user experience. If you have ideas for how we can improve our services, we’d love to hear from you. Click here to email us. By continuing to browse you agree to our use of cookies. Please see our Privacy & Cookie Usage Policy to learn more.

Close