Identification of Strategic Supplies for Leading Mining Companies in

Identification of Strategic Supplies for Leading Mining
Companies in order to Direct the Promotion and Attraction of
Investment
Final Report
Prepared by: Universidad Santa María Empresas S.A.
Client: CORFO
Santiago, September 2009
Consultancy for the Identification of Strategic Supplies for Leading Mining Companies
in order to Direct the Promotion and Attraction of Investment
CONTENTS
Executive Summary ................................................................................... 6
1.
2.
Introduction ....................................................................................... 8
Aims................................................................................................... 9
2.1 General aim ..................................................................................... 9
2.2 Specific aims.................................................................................... 9
3.
4.
5
6
Activities .......................................................................................... 10
3.1
Preparation of interview tools ...................................................... 10
3.2
Interviews.................................................................................... 11
3.3
Identification of goods and services ............................................. 13
3.4
Analysis matrix............................................................................ 13
3.5
Identification of current and future projects ................................. 14
3.6
Estimation of amounts ................................................................. 14
3.7
Identification of opportunities for suppliers ................................. 14
Current figures and projections ........................................................ 16
4.1
Chile as a producer...................................................................... 16
4.2
Projected copper-mining investment in Chile ............................... 17
4.3
Main projects .............................................................................. 20
4.4
Mining production in Chile........................................................... 22
4.5
Main copper demanders .............................................................. 26
Identification of main supplies .......................................................... 29
5.1
Identification of main supplies ..................................................... 29
Demand for strategic supplies .......................................................... 34
6.1
Matrix of strategic supply analysis ............................................... 34
6.2
Strategic supplies ........................................................................ 35
b)
Tyres ........................................................................................ 48
c)
Explosives ................................................................................ 49
6.3
Regional market .......................................................................... 50
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Consultancy for the Identification of Strategic Supplies for Leading Mining Companies
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7
Critical supplies for mining ............................................................... 51
9
Strategies for attraction .................................................................... 58
8
Potentially successful cases .............................................................. 55
10 Concluding remarks.......................................................................... 64
Bibliography ........................................................................................... 65
Annexes ................................................................................................. 67
Annex 1. Websites. Suppliers ............................................................... 67
Annex 2. State of mining investment projects....................................... 69
Annex 3. Methodology for estimating amounts for supplies ................. 70
Annex 4. Relevant mining supplies ....................................................... 76
Annex 5. Value chain in the mining industry......................................... 77
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Consultancy for the Identification of Strategic Supplies for Leading Mining Companies
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INDEX OF FIGURES
Figure 1: Impact of the mining industry on the economy ........................... 8
Figure 2: Study methodology................................................................... 10
Figure 3: Major copper-producing countries............................................ 16
Figure 4: Major copper-producing countries............................................ 17
Figure 5: Trend in copper grade in Chile.................................................. 18
Figure 6: Major copper-producing countries............................................ 19
Figure 7: Major mining projects ............................................................... 20
Figure 8: Copper-mine production in Chile.............................................. 23
Figure 9: Breakdown of copper production .............................................. 24
Figure 10: Copper-refining capacity ........................................................ 26
Figure 11: Main consumers of copper ...................................................... 27
Figure 12: Main export destinations ........................................................ 28
Figure 13: Breakdown of supplies by consumption .................................. 29
Figure 14: Main chemical reagents .......................................................... 30
Figure 15: Main chemical reagents .......................................................... 31
Figure 16: Main chemical reagents .......................................................... 32
Figure 17: Main mining inputs ................................................................. 33
Figure 18: Main mining equipment .......................................................... 33
Figure 19: Categorisation of strategic supplies ........................................ 35
Figure 20: Electricity consumption........................................................... 36
Figure 21: Cost of electricity ................................................................... 38
Figure 22: Annual fuel consumption ........................................................ 39
Figure 23: Fuels used in mining .............................................................. 39
Figure 24: Projected energy costs ............................................................ 40
Figure 25: Mineral to be processed.......................................................... 42
Figure 26: Projection of hydrometallurgy reagents ................................... 43
Figure 27: Projected expenditure on reagents for flotation ...................... 44
Figure 28: Projected steel consumption ................................................... 45
Figure 29: Projected material to be removed............................................ 46
Figure 30: Projected mining-truck fleet ................................................... 47
Figure 31: Projected demand for mining equipment ................................ 48
Figure 32: Projected demand for tyres ..................................................... 49
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Consultancy for the Identification of Strategic Supplies for Leading Mining Companies
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Figure 33: Projected consumption of explosives ...................................... 50
Figure 34: Critical supplies for mining ..................................................... 51
Figure 35: Criticality in the haulage of ore and intermediate material ....... 52
Figure 36: Critical supplies in crushing and grinding ............................... 52
Figure 37: Critical supplies in the flotation process.................................. 53
Figure 38: Critical aspects of personnel at sites ....................................... 53
Figure 39: Critical aspects in prospecting and operation .......................... 54
Figure 40: Number of suppliers with a local presence .............................. 54
Figure 41: Representation of the effect of treatment on the material ........ 56
Figure 42: SWOT analysis to attract investment........................................ 58
Figure 43: Aims, targets and monitoring indicators ................................. 60
Figure 44: Methodology for estimating demand ....................................... 70
Figure 45: Main supplies identified preliminarily ...................................... 76
Figure 46: Value chain of the mining industry .......................................... 77
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INDEX OF TABLES
Table 1: List of high-priority contacts ..................................................... 11
Table 2: List of medium-priority contacts ................................................ 12
Table 3: List of back-up contacts ............................................................ 12
Table 4: Breakdown of generation fuel .................................................... 37
Table 5: Unit hydrometallurgy reagent consumption ................................ 42
Table 6: Flotation unit consumption ........................................................ 44
Table 7: Unit consumption of steel balls and steel plate........................... 45
Table 8: Truck performance .................................................................... 47
Table 9: Shovel loader performance......................................................... 48
Table 10: Projected supply market .......................................................... 50
Table 11: Breakdown of mining projects .................................................. 69
Table 12: Projected production ............................................................... 71
Table 13: Copper grade in mining operations in the country .................... 71
Table 14: Mineral and material to be removed ......................................... 72
Table 15: Energy consumption ................................................................ 73
Table 16: Reagent consumption .............................................................. 73
Table 17: Steel consumption ................................................................... 74
Table 18 Demand for mining equipment ................................................. 75
Table 19: Tyre and explosive consumption .............................................. 75
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Executive Summary
Future investment in mining projects amounts to almost US$33 billion. Some
projects seek to further operations with a very low copper grade. This means that
their operating costs do not promote their competitive positions, placing them in
a life or death situation. Other projects seek to strengthen their position in order
to gain a foothold as producers in a country that contributes approximately 35%
of the copper produced worldwide.
For current and future projects, suppliers are necessary to deliver services,
supplies and goods at cost conditions that will ensure the competitiveness of the
mining industry in Chile. This report concludes that supplies, goods and services
are not served locally in the country, including applied robotics, innovations in
mining equipment, innovations in inputs, water management, monitoring of
slopes and inbound logistics services. Others have suppliers that operate in
markets with the characteristics of a monopoly, which does not help when it
comes to operating with competitive costs either.
Critical mining supplies with an impact on various processes were identified; for
example, thermal energy, tyres, maintenance and operational services are relevant
and influential supplies for the transportation of minerals. Likewise, steel balls,
maintenance services and water are crucial for grinding and crushing.
Mining companies have been observed to be vigilant in their search for options to
improve positions, attracting suppliers on their own. It is a condition to build
strategic alliances with very aggressive actions, although these have not yet
yielded the desired results.
The country's name serves to attract investors and to develop mining in
neighbouring countries, thus expanding the market on which suppliers can offer
their goods, inputs and services. However, Chile's political, economic and
administrative stability does not extend consistently beyond its borders, leading
to decisions to postpone local operations.
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One aspect that has been gaining momentum in the mining industry is the focus
on core business, leaving non-strategic aspects to third parties. This means that
mining companies no longer seek a product or a good. They are searching for
comprehensive solutions that can guarantee availability. And they are prepared to
pay for it.
Another important issue pointed out by a representative of one of the companies
interviewed is the intention of breaking the paradigm of working only with big
suppliers. In the future, they may be willing to back small businesses that deliver
solutions and to adopt the model of certain Australian companies that generate
spin-offs operating under the auspices of the mining company until they can run
the operations by themselves.
CORFO is working proactively with specific actions such as the mining forum held
in October 2009. This included the participation of suppliers from various
countries who were shown the projects for mining industry investment over the
coming years. At the same time, the strengthening of existing instruments to
support investment attraction should continue to allow for easier decision-making
with regard to potential suppliers.
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1.
Introduction
Investments add dynamism to a country's economy, generating benefits in all
areas, increasing employment and technological inputs, improving management
and creating the conditions for personal development.
The mining industry is a rich source of national opportunities (Figure 1).
Therefore, in an attempt to maintain the country's favourable competitive position
in international markets, it would be convenient to strengthen access to new
markets, making it essential to further regional potential. It is necessary, then, to
identify the potential commercial and business activities that could strengthen
Chile's current position.
Figure 1: Impact of the mining industry on the economy
Source: Authors.
Hence, this sector emerges as one of the most crucial for the country's
development. Furthermore, the identification of strategic supplies for the sector,
as part of the bid to promote and attract foreign investors, is equally relevant.
As a result, Universidad Santa María Empresas S.A. has undertaken the project set
out in this report using the background information obtained during the study,
indicating the necessary guidelines for this national industry.
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2.
Aims
The aims of the project are formulated within the provisions of the tender and are
as follows.
2.1 General aim
Identify the strategic supplies of leading mining companies for investment
projects and operation purchases, and their current suppliers, in order to devise
strategies to attract potential investment in Chile.
2.2 Specific aims
• Draw up a register of the key inputs and services of the main copper mining
projects in Chile related to mine operation and new investment, the costs of
which are expected to rise and thus pose a threat to the global competitiveness
of this activity.
• Identify the structure and current tender conditions, type of threat faced and
potential areas of mitigation for each critical input and service.
• Select cases in which enhanced competitiveness is associated with the direct
presence in the local market of global manufacturers or suppliers of inputs or
services, including those whose presence in Chile could be improved.
• Propose guidelines for a strategy to promote and attract investment to begin
operations in Chile.
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Consultancy for the Identification of Strategic Supplies for Leading Mining Companies
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3.
Activities
Under the terms of the technical proposal presented to CORFO by Universidad
Santa María Empresas S.A., the following activities were conducted, based on the
methodological line shown in the figure below:
Figure 2: Study methodology
Source: Authors
3.1
Preparation of interview tools
The team identified the key concepts to address and the guidelines for conducting
the semi-structured interviews. A form-type annex was designed, together with a
form for recording more specific information and figures. These documents were
presented to and validated by CORFO before the interviews commenced.
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3.2
Interviews
A list was drawn up for the interviews containing the figures of reference in the
mining industry. The names were classified into three groups based on the impact
of their contribution to the project results.
As above, these lists were checked and validated by CORFO prior to contact.
High priority
The most relevant names to the project and representatives of the country's
leading mining operations were defined as high priority. This list contains 17
people directly linked to mining supplies and constitutes the basis of the
sampling.
Alta Prioridad
Prioridad
Empresa
Codelco
Regic
Sicep
Quadrem
MEL
Cesco
Collahuasi
Anglo American (Santiago)
Barrick
Enap
Soquimich
Altonorte (Xstrata)
BHP Billiton
Codelco Teniente
Esperanza
Mantos de Oro
Anglo American (Los Bronces)
Encuestado
Fernando Marchant
Daniel Barreda
Álvaro Tapia
Iván Braga
Marcelo Ocampo
Juan Carlos Guajardo
José Cifuentes (Santiago)
Juan Alberto Ruiz
Carlos Lobatón
William Montes
Rodrigo Copano
Julio Agurto
Ricardo Reyes
Héctor Soto
Alejandro Treuer
Pablo Villarroel
Eduardo González
Table 1: List of high-priority contacts
Source: Prepared by USM S.A.
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Medium priority
This category corresponds to the group identified as being of medium
importance, comprising individuals with a vast knowledge of the subject from the
companies considered in the above list.
Prioridad Media
Prioridad
Empresa
Codelco
Codelco Norte
Collahuasi
BHP Australia
MEL
Polpaico (Holcim)
Melón (Lafarge)
Encuestado
Alex Caqueo
Nallib Jodor
Giancarlo Bruno
Cristhian Allende
José Bouza
Juan Carlos Agullo
Mauricio Herrera
Table 2: List of medium-priority contacts
Source: Prepared by USM S.A.
Back-up
This was a back-up group of people to be contacted if any of those listed above
were not available.
Back up
Prioridad
Empresa
Encuestado
Quebrada Blanca
Daniel Bolados
Pucobre
Ignacio Ruiz
Consejo Minero
Alejandro Plaza
Independiente
Alfredo Pérez
Transporte Santa Marta
Juan Carlos García
BHP
Pierre Kehrkoffs
BHP
Andrew Callahan
Andina
Ricardo Fernández
BHP
Osvaldo Urzúa
Anglo American (Los Bronces)
Mario López
Anglo American (El Soldado)
Eric Urrutia
Anglo American (Mantos Blancos) Carlos Tolmo
Anglo American (Chagres)
Juan Carlos Olguín
Table 3: List of back-up contacts
Source: Prepared by USM S.A.
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Some stumbling blocks were identified during contact with the companies, which
had an impact on the performance of the project at the information-gathering
stage, as summarised below:
•
When the mining companies were contacted directly, they stated that both
the interviews and the information had to be requested by CORFO.
•
This is because mining companies work internally on these issues,
allocating resources and establishing strategic agreements with suppliers.
As a result, they are not always willing to share information with other
companies, despite the collaborative context of relations between mining
companies.
•
It is necessary to establish a single channel of communication between
CORFO and the mining companies for this type of initiative, in the light of
certain risks such as:
o Submission of incomplete or differing information or information
updated at different times when required from different areas of a
single company.
o Overlapping of CORFO-led initiatives in the mining industry,
resulting in confusion among mining companies.
3.3
Identification of goods and services
By gathering information from public sources (corporate reports of the
companies, COCHILCO, Cesco, IIMCH and websites, among others) and data
obtained through interviews, the team was able to identify a set of goods and
services defined as strategic for national mining companies. In some cases, it was
possible to identify some suppliers, the websites of which are listed in Annex 1.
3.4
Analysis matrix
We determined the basic elements for segmenting the supplies identified as
strategic or high priority for mining companies. Based on these parameters, we
developed a qualitative four-quadrant matrix allowing the different services,
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inputs, goods and services to be grouped into the categories of consumption,
strategic and maintenance, repair and operations.
3.5
Identification of current and future projects
Additionally, based on information from public and private sources, we were able
to identify the main mining projects, both those underway and those which have
been postponed or are at the preliminary study phase. This allowed us to predict
the country's copper production and estimate strategic demand over a 10-year
timeline. Annex 2 contains the list of projects with their investment totals and
likely date of implementation.
3.6
Estimation of amounts
A method based on projected production, unit consumption and price was used to
estimate costs. This used long-term price changes in order to keep the long-term
trend above the cyclical effects experienced by copper consumer economies
around the world.
For somewhat more complex estimates (mining equipment and inputs), an
estimate was made both of the ore to be treated and the material to be removed.
Forecasts of mineral grade, recovery rates and sterile/mineral ratio were thus
used. With this and unit consumptions it was possible to estimate the level of
demand (Annex 3).
3.7
Identification of opportunities for suppliers
Based on the estimates of projected demand, associated costs and the local
presence of competitors in the industry, we identified the relevant items for the
mining industry that have the greatest potential for attracting companies to Chile.
In this case, we identified four supplier company categories, namely those:
a) Without a presence on the national market.
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b) With up to three companies with a local presence.
c) With between 4 and 6 companies.
d) With more than 7 companies.
This breakdown was carried out for both strategic supplies and for support
services and goods.
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4.
Current Figures and Projections
The report will now describe the results of the current dimensioning of the copper
mining industry in Chile and of projected future production, based on the
different projects currently underway and their development phase.
4.1
Chile as a producer
Globally, world copper production has increased by an annual average of 13.4% in
recent years, now standing at 15.5 million tonnes. In this context, Chile, with a
production of 5.3 million tonnes of fine copper, has contributed 34% to global
production, as shown in the figure below.
Producción de Cobre en 2008
kton de cobre fino
6000
5000
4000
3000
2000
1000
0
Figure 3: Major copper-producing countries
Source: Compendio de la minería chilena 2009.
At producer level, five global producers account for 36%, some of which have
operate mines in Chile, namely, Codelco, BHP Billiton and Anglo American. The
breakdown of production for these producers in recent years is provided in the
following figure.
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Principales Productores
2000
kton cobre fino
1500
1000
500
0
2004
2005
2006
2007
2008
Figure 4: Major copper-producing countries
Source: Compendio de la minería chilena 2009.
4.2
Projected copper-mining investment in Chile
Overall, the portfolio of projects underway or about to be implemented amounts
to US$32.7 billion over a likely timeline of the next ten years. While all of the
projects identified have already passed the preliminary assessment stage, the
sharp fall in copper prices produced delays and even the reassessment of some
projects in the portfolio. It is important to note that copper reserves in Chile
amount to 360 million tonnes.
Codelco, with a total investment of US$10.35 billion, is the company with the
biggest investment in projects over the next decade, explained largely by the
progressive deterioration in the mineral grade at some of its sites, which is linked
to the age of the latter. Hence, projects such as the expansion of Andina, the new
level of the El Teniente division and the underground Chuquicamata, in Codelco
Norte, seek only to prolong the useful life of the sites while keeping production
levels up.
Figure 5 illustrates the trend in copper grade in Chile, signalling a downward
course over recent years, from 1.41 in 1999 to 0.99 in 2009. This behaviour is
normal since the operational strategy of mining is to start extraction in the area
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with the best grade so as to optimise results in the shortest time possible. In
order to maintain the production rate, this grade reduction requires an increased
movement of earth, increasing the distances of movements and leading to the use
of slag and other waste with a % of copper.
Porcentaje de Cobre
Ley de Cobre Promedio
1,70
1,60
1,50
1,40
1,30
1,20
1,10
1,00
0,90
0,80
0,70
Concentradora
Lixiviación
Promedio Chile
Figure 5: Trend in copper grade in Chile
Source: Anuario de Estadísticas del Cobre y Otros Minerales 1989-2008, COCHILCO, 2008.
Of the total investment figure, US$5.281 billion have been paid out up until
December 2008, while the investment to be made over the next five years stands
at US$23.319 billion.
These values fall dramatically to US$8.63 billion for the following 5 years, since
the number of confirmed projects is lower, given that there are several projects in
the exploration phase that have not yet undergone a technical-economic
assessment.
This trend in grade translates to increased development costs, production costs
and, ultimately, a decline in competitiveness, as illustrated in the figure below.
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Pérdida de
competitividad
Figure 6: Major copper-producing countries
Source: Compendio de la minería chilena 2009.
Other
aspects
that
competitiveness are:
•
also
have
a
significant
impact
on
the
decline
in
Supply and logistics
•
Stock shortages in the face of peaks in demand (as occurred a few
years ago).
•
High transport costs (associated mainly with Chile's geographical
location).
•
Longer turnaround times (due to the distance from the supply
centres).
•
•
Increased costs (associated, for example, with rising fuel prices).
Lack of resources
•
•
Shortage of water and fuel.
Increasingly distant operations.
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4.3
Main projects
The thirty-one projects in the investment portfolio for the coming years, at
varying stages of completion, amount to US$32.7 billion (2009 to 2018), of which
28% are Codelco initiatives.
The nine most important projects are together worth US$21.054 billion,
representing 68% of the total investment for 2010-2019, as shown in the figure
below.
Inversión Mayores Proyectos
6000
US$ Millones
5000
4000
3000
2000
1000
0
Figure 7: Major mining projects
Source: Compendio de la minería chilena 2009.
 Esperanza
Site located in the Sierra Gorda area, with reserves of 786 million tonnes (0.53%
Cu and 0.2 gpt Au) in sulphides. Estimated production is 195 kt per year of fine
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copper in concentrates, containing 200 thousand ounces of gold. It is expected to
begin operation in 2010.
 Los Bronces expansion
Project that seeks to increase the ore processing capacity by 100 kt per day,
representing a 175 kt increase in fine copper per year. This increased processing
includes the addition of a new crushing and grinding line plus a material transport
system for taking the latter to concentration plants with a greater capacity. The
estimated launch date is 2011.
 Caserones
This site (formerly Regalito) is located south-east of Copiapó 4,200 metres above
sea level. It has reserves of over 600 million tonnes of leachable copper, mainly
sulphides and a small quantity of oxides. Annual production is estimated at 30 kt
of cathodes through electrowinning and 120 kt per year of concentrate. It is set to
begin operation in 2012.
 El Morro
Copper-gold deposit located in the municipality of Alto del Carmen, 84 km from
Vallenar. It has reserves of 487 million tonnes of copper and gold (0.56% and 0.44
gpt, respectively). Estimated production is around 195 kt of fine copper in
concentrate and 353,000 ounces of gold, for a period of over 15 years. It is
expected to begin operation in 2013.
 Escondida Phase V
The aim of this expansion is to maintain production levels in the medium term,
given the impoverished grade of the ore in recent years. It provides for the
construction of a third concentrator plant, which would increase the mineral
processing capacity. It is currently postponed, so will not be launched until at
least 2015. However, in the light of improved copper prices, it could be
reactivated before this date.
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 Sierra Gorda
Deposit located in the Atacama region with a presence of copper, molybdenum
and gold. Its measured resources total 251 million tonnes in oxides, with average
grades of 0.42% copper, 0.03% molybdenum and 0.07 gpt gold. Its useful life is
estimated at 25 years and operations are expected to begin in 2014.
 Andina Expansion Phase II
Project seeking to maximise Andina's productive capacity, ramping it up to an
extraction and processing level of 230 kt of ore a day. To do so, underground
production is to be maintained at current levels, a pit is to be developed and the
processing plants will be relocated. This will increase concentrate production by
320,000 tonnes. It is expected to begin operation in 2015.
 New level of El Teniente mine
Project that seeks to keep the site operating for another 50 years by maintaining
current production levels. The pre-feasibility study has been completed and early
works are at the implementation stage. Operations are expected to begin in 2017.
 Chuquicamata underground mine
Project seeking to exploit the mineral resources located below the current pit,
which is estimated to become unprofitable by the end of the next decade. The
estimated investment is US$2 billion and involves the transformation of the
opencast mine to an underground operation. Production capacity is estimated at
340 kt of fine copper per year for at least 50 years. It is at the pre-feasibility stage
and operations are expected to begin by 2018.
4.4
Mining production in Chile
The country's copper mine production has increased by 21.4% over the past 10
years from 4.4 million tonnes in 1999 to 5.3 million tonnes in 2008.
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This increased production is largely due to the strong demand for commodities
driven by consumption in China, which has led to the study and implementation
of new initiatives and the maintenance or reopening of sites that had not been
profitable in previous scenarios. For the same reason, following the onset of the
contractionary phase in the business cycle in late 2007, production levels fell by
4.1% following mine closures or a reduction in the level of production, with the
aim of adapting rising costs to market prices.
According to estimates, a production of almost 6.1 million tonnes of fine copper
is projected for 2019, which represents an increase of 19% on current levels. The
future trend, based on COCHILCO figures and USM S.A. estimates, can be seen in
the figure below.
Kton de Cobre
Producción de Cobre Fino
5.000
4.500
4.000
3.500
3.000
2.500
2.000
1.500
1.000
1995
2000
2005
2010
2015
Concentrados
Concentrados Proy.
Cátodos Sx-Ew
Cástodos Proy.
2020
Figure 8: Copper-mine production in Chile
Source: Anuario de Estadísticas del Cobre y Otros Minerales 1989-2008, COCHILCO, 2008.
However, a gradual decline in the production levels of current sites is expected in
aggregate terms over the coming years, in line with the aging of certain
emblematic sites (Chuquicamata, El Teniente) and the impoverishment of ore
grades, which will lead to an adjustment in production levels due to rising costs.
Production replacement projects, as is the case of the new level of the El Teniente
mine, the Chuquicamata underground project and the extension of Lomas Bayas,
whose investment aim is based on maintaining current production levels, have
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been given the consideration of new production rather than base production for
the purposes of this report. Thus, following the launch of the thirty-one mining
projects in the pipeline, production is expected to reach 2.63 million tonnes of
fine copper, in addition to the 3.4 million from current sites.
At present, most production is copper concentrate, which accounts for around
40% of annual production. However, its relative weight in production has declined
by 7.9% over the last five years due to increased refined production, especially of
electrowon cathodes, up 20.6%.
Composición de Producción
(Kton Cu)
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
7.000
6.000
5.000
4.000
3.000
2.000
1.000
-
Cátodos Sx-Ew
RAF y Electro Refinados
Concentrados
Figure 9: Breakdown of copper production
Source: Anuario de Estadísticas del Cobre y Otros Minerales 1989-2008, COCHILCO, 2008.
In addition, fire-refined (FR) copper anodes have witnessed a sharp decline in
production over this period, from 150 thousand tonnes/year in 2004 to 99
thousand tonnes in 2008, which represents a fall of 34%. Likewise, electrorefined
cathodes have also experienced a slight decline over the last five years (2.75%),
with production being maintained at around 1 million tonnes.
Despite there being seven foundries and three refineries in Chile, the proportion
of mined copper converted into refined copper products (SX-EW cathodes, ER
cathodes and FR) has declined since its peak of 62% in 2002 to 57% in 2008,
reflecting an increase in concentrate not refined in this country. Briefly, we can
note the following:
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•
•
•
•
Production in 2008: 5.3 million tonnes of copper.
Projected production up until 2019: 6 million tonnes.
Main product: copper concentrate (60%).
SX-EW cathodes account for around 35%.
Some initiatives are now emerging to increase the capacity of Chile's refineries in
order to cope with production increases in the leading mining companies.
Codelco, for example, has made significant technological improvements at its
Codelco Norte refinery, increasing its capacity by 200 thousand tonnes per year. It
is also planning a generation project for a new smelter and refinery in the central
area that will integrate the operations of the Andina, El Teniente and Ventanas
division, which is currently under review given current prices.
In the same vein, Anglo American is conducting pre-feasibility studies for a
similar project to complement the work of its Chagres smelter, which will cut
freight costs for concentrates and allow the production of sulphuric acid to be
stepped up.
Nonetheless, a sharp increase in concentrate production is expected over the next
decade (23%), while cathodes obtained by solvent extraction and electrowinning
will fall 2% from the levels reached in 2008.
In this scenario, refining capacity through electrowinning, fire refining and
electrorefining will stand at 56% for 2019, based on the assumption that all of the
above initiatives will come into operation within the stated period.
The biggest gap between production and refining capacity is projected for 2014
and 2015, deemed to be prior to the start of operations at the smelter and
refinery to reinforce Chagres (Anglo American) and the Codelco refinery project in
the central area. This situation is expected to remedy itself by the end of the
decade.
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Capacidad de Refinamiento de Cobre
kTon de Cobre
2010
2012
2014
2016
2018
5.000
60,0%
59,0%
58,0%
57,0%
56,0%
55,0%
54,0%
53,0%
4.000
3.000
2.000
1.000
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Concentrados
Cátodos Sx-Ew
Cap. RAF+Electroref.
Porcentaje de Refinamiento
Figure 10: Copper-refining capacity
Source: COCHILCO figures and USM S.A. estimates.
4.5
Main copper demanders
Copper is the third most used metal in the world after steel and aluminium. The
main consumers of the metal are the industrialised countries and some emerging
countries, the European Union, China, Japan and the United States being the
leading demanders.
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Principales Consumidores de Cobre
Mexico
2%
Otros
17%
Brasil
2%
Unión Europea
24%
India
2%
Taiwan
4%
Rusia
4%
Corea del Sur
5%
China
21%
Japón
7%
Estados Unidos
12%
Figure 11: Main consumers of copper
Source: Prepared by USM S.A. based on information from COCHILCO, Cesco and various public sources.
Current projections indicate a decline in global demand for 2009 as a result of the
global economic crisis. The situation looks set to rebound in 2010, when demand
will increase by 3.5% to reach 18.37 million tonnes. Despite this forecasted
decline in aggregate demand for 2009, China is expected to resume its level of
consumption and increase by 18.9% this year.
During 2008, the mining companies operating in Chile together exported 5,405 kt
of copper. Its main destinations were China (21%), Japan (12%), South Korea (7%),
Italy (7%) and the US (7%).
Current estimates indicate an annual growth in China's consumption of more than
8.8% over the next 5 years, representing a demand for 2.5 million tonnes of
refined copper and 2.7 million tonnes in concentrate. A slowdown in consumption
growth is expected between 2015-2020 with rates of around 5.5% per annum,
reaching 10.7 million tonnes towards the end of the following decade.
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Principales Destinos Exportaciones
de Cobre
Taiwan
4%
Otros
20%
España
3%
Alemania
3%
Francia
4%
China
21%
Italia
7%
Holanda
6%
Corea del Sur
7%
Japón
12%
Estados Unidos
7%
Brasil
6%
Figure 12: Main export destinations
Source: Anuario de Estadísticas del Cobre y Otros Minerales, COCHILCO.
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5 Identification of main supplies
5.1
Identification of main supplies
To facilitate the analysis, these supplies have been grouped into three main
categories: energy and fuel, mining goods and inputs, and services. In addition,
the items are grouped into categories according to the nature of the supplies.
Thus, there are six categories of goods and inputs and one of services, together
covering 29 types of supply, the breakdown of which is attached in the table in
Annex 4.
Services account for the biggest consumption, with US$2.8 billion, representing
43% of total expenditure, followed by mining goods and inputs (34%) and energy
and fuels (23%).
Composición de suministros
Bienes e
insumos
mineros
33%
Energía y
combustibles
25%
Servicios
42%
Figure 13: Breakdown of supplies by consumption
Source: Prepared by USM S.A. based on figures from COCHILCO and other public sources.
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In the case of energy and fuel, increased production will clearly involve an
increase in energy demand (Figure 14). Although this is very obvious, the crucial
point is that the sources of energy supply in the Norte Grande mining area are
based mainly on primary fossil fuels, resources that are not available in Chile.
Moreover, considering the carbon footprint trend, the issue could become even
more critical, which is why some companies have taken steps towards nonconventional renewable energy (NCRE) such as wind and solar power.
The relevant figures on energy and fuel indicate that:
•
•
•
It represents 25% of mine expenditure.
There will be an average annual increase from 2009-2019: approximately.
Projected average energy and fuel expenditure: US $3.2 billion.
Demanda
de Energía
Costo de
Energía
US$ Millones
3000
2500
2000
1500
1000
500
0
2000
Energía
2005
Combustible
2010
2015
Energía Proyectado
2020
Combustible Proyectado
Figure 14: Main chemical reagents
Source: COCHILCO figures and USM S.A. estimates.
Upon analysis of the main mining goods and inputs, we see that the majority are
chemical reagents (48%), followed by supplies and mining equipment, with 37%
and 15%, respectively. An overview of the relative weight of some inputs relevant
to operations is illustrated below while Figure 15 illustrates the future trend in the
same.
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o
Reagents and chemicals
o
Sulphuric acid: accounts for 70% of hydrometallurgy reagents with
around US$500 million.
o
o
Grinding balls
o
o
48% of flotation inputs with US$220 million.
Plate steel
o
o
Lime: accounts for 40% of flotation reagents.
25% of flotation inputs with US$120 million.
Explosives
o
Will increase from US$250 million in 2008 to US$500 million in
2019, along the lines of the trend that will emerge following start-
o
Tyres
o
up of the projects described above.
An increase of US$125 million is estimated over 2008-2019,
consistent with the growth in the fleet of trucks, as shown below.
Principales
Insumos
de Producción
Principlaes
Insumos
Producción
700
Reactivos
600
MM US$
500
Bolas de Molienda
400
300
Aceros de
Revestimiento
200
Explosivos
100
Neumáticos
0
2004 2006 2008 2010 2012 2014 2016 2018
Figure 15: Main chemical reagents
Source: COCHILCO figures and USM S.A. estimates.
Among the chemical reagents, the biggest consumption is for sulphuric acid
(H2SO4), which represents 69% of total demand in this category, followed by
sodium hydrosulphide (NaSH) with 10%. All other reagents, analysed individually,
have relatively lower shares not exceeding 5%, as shown in the figure below.
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These include cobalt sulphate, foaming agents, flocculating agents, diluents and
extractants, among others.
Reactivos químicos
Espumante
4%
Floculante
3%
Cal
3%
Diluyente
2%
Sulfato cobalto
5%
Colectores
4%
Extractantes
0%
NASH
10%
Ácido sulfúrico
69%
Figure 16: Main chemical reagents
Source: Prepared by USM S.A. based on figures from COCHILCO and other public sources.
Major mining inputs include the share of milling balls, which, with US$220 million,
represent 48% of operating costs in mining, followed by tyres, with a 30% share,
as illustrated in Figure 17. In mining equipment, trucks account for 78% of
consumption, followed by drilling machines (13%) and loaders (9%), the
breakdown of which is also provided below.
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Insumos Mineros
Aceros
Revestimient
o
24%
Neumáticos
30%
Bolas de
Molienda
46%
Figure 17: Main mining inputs
Source: Prepared by USM S.A. based on figures from COCHILCO and other public sources.
Equipos Mineros
Perforadoras
Rajo
13%
Cargadores
Frontales
7% Palas Rajo
Abierto
2%
Camiones
Mineros
78%
Figure 18: Main mining equipment
Source: Prepared by USM S.A. based on figures from COCHILCO and other public sources.
With regard to the future trend in the main mining equipment, there follows an
overview both of trucks (whose existing fleet of 800 will increase by 600 units,
representing an investment of over US$2 billion) and of shovel loaders and
loading equipment, which will represent an annual investment of US$100 million)
with an average annual increase of 7 shovel loaders, 15 loading machines and 9
drilling machines.
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6 Demand for strategic supplies
After gathering background information from public sources, interviews and the
experience of the consultant team, a set of goods and services was identified
which, due to their amount, volume, criticality for the operation and degree of
specialisation, were deemed crucial to the national mining industry.
6.1
Matrix of strategic supply analysis
To categorise the various inputs, goods and services identified initially, a
qualitative analysis matrix was prepared. This consists of four quadrants and
allows supplies to be grouped into services, strategic items, consumer items and
items of maintenance, repair and operations (MRO).
Features of services:
• Mainly labour services.
•
•
•
Handled as per specifications.
Specific contracts used.
Typically with a set duration.
Examples: contracts for miners, engineering and maintenance.
Features of consumer items:
•
•
•
Undifferentiated products.
Choice is determined mainly by price.
Generally handled through tendering tools.
Examples: Safety, office items, travel.
Features of MRO items:
•
•
•
Inputs aimed at maintaining operations.
They are intensive.
Purchasing and payment are automated.
Examples: valves, pumps, bearings.
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Features of strategic items:
•
•
•
•
•
Require detailed negotiations.
Few suppliers.
Require much more detailed cost analyses.
Associated with strategic supply projects.
Tend to generate strategic partnerships with suppliers.
Under this matrix approach, the various supplies are grouped as follows:
Servicios
•
•
•
•
Ítems estratégicos
Mantención y Generales
Transporte
Ingeniería
Construcción
•
•
•
•
•
Ítems consumo
•
•
•
Aseo
Viajes
Artículos de oficina
Energía
Combustibles
Insumos de producción
Equipos mineros
Reactivos químicos
Ítems MRO
•
•
•
Bombas
Válvulas
Automatización y control
Figure 19: Categorisation of strategic supplies
Source: Prepared by USM S.A.
6.2
Strategic supplies
Based on the above, a summary now follows of the main supplies deemed
strategic for mining. A summary of the features of each supply is provided.
a) Electricity
In the 1990s, mining companies overhauled their policy of self-sufficiency in
electricity, progressively turning towards external procurement of the input in
order to cover the total demand of their installed systems. To this end, they
established important contractual agreements, ensuring the continuity of supply
over a number of periods. This was largely possible due to the incorporation of
natural gas into the energy matrix halfway through the past decade, which led to
the development of new plants with relatively low costs.
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In turn, these decreased costs led to the performance of many projects that had
not been sufficiently attractive in earlier scenarios, which resulted in a significant
increase in the demand for electricity.
Between 1995 and 2008, electricity consumption increased by almost 8.4%
annually, above production, which increased at a rate of 7.2%.
This is due not
only to the increasing number of companies demanding supply but also to other
relevant factors, including the aging of deposits, increases in mine size and a
substantial increase in refined copper production, since cathode production
(whether by electrowinning or electrorefining) is a more energy-intensive process.
6.000
5.000
4.000
3.000
2.000
1.000
-
20.000
10.000
GWh
15.000
5.000
-
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
20
08
Kton de Cobre Fino
Consumo de Energía Eléctrica
Producción de Cobre
Energía Eléctrica
Figure 20: Electricity consumption
Source: COCHILCO figures and USM S.A. estimates.
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Similarly, projected annual electricity consumption averages around 18,900 GWh
per year, which translates into a total of US$1.767 billion. For 2019, estimated
consumption stands at 25,540 GWh, representing a 77% increase on the level
observed in 2008.
Due to the trans-Andean natural gas supply being cut off, generation companies
found it necessary to diversify their fuel supply in order to maintain the levels of
service demanded by the mining companies.
Thus, natural gas fell from representing 60% of generating fuel in 2004 to 11.9%
in 2008, while diesel was given a strong push, increasing from values of close to
1% to 27% over the same period. This had a major impact on costs, which
increased by 213% from US$36/MWh in 2006 to US$113/MWh in 2008 in the SING
grid, where 70% of the country's copper is mined.
Combustible
Diesel
Petróleo Combustible
Carbón Bituminoso
Gas Natural
Carbón + Petcoke
Total
2004
1%
0,20%
37,60%
61,20%
100%
2008
27,20%
2,30%
41,50%
11,90%
17,30%
100%
Table 4: Breakdown of generation fuel
Source: Consumo de Energía y Emisiones de Gases de Efecto Invernadero de la minería del Cobre de Chile,
COCHILCO.
To estimate the cost of electricity, the average cost between 2004 and 2006 has
been taken as the unit cost per GWh. This corresponds to the period in which the
gas cuts from Argentina began, with an annual adjustment similar to the periods
before the crisis.
This holds both for the new coal-fired generation projects in the Electroandina,
Codelco and BHP Billiton portfolios and for the construction of the liquefied
natural gas plants of Quinteros and Mejillones, which would cut costs from the
current level to values closer to those prior to the gas crisis.
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Demanda
deEnergía
Energía Eléctrica
Costo de
Eléctrica
US$ Millones
3000
2500
2000
1500
1000
500
0
2000
2005
2010
2015
Energía
Energía Proyectado
2020
Figure 21: Cost of electricity
Source: COCHILCO figures and USM S.A. estimates.
b) Fuel
The energy consumed as fuel in processes associated with copper mine
production witnessed a 36% increase between 2004 and 2008, despite production
falling by 2% over this period. This represents a 38% increase in the unit rates of
fuel consumption over the past 5 years.
If we observe the timeline between 1995 and 2008, the situation is the diametric
opposite, since a progressive decline in unit consumption rates was witnessed
between 1995 and 2004, when they fell by 29%. Therefore, the trend for 19952008 is towards a 3% reduction in the values recorded in the mid-1990s.
This change of direction is due to a range of factors, including decreased mineral
grade, increased haulage distances, change in the portfolio of marketable
products and technological changes that have intensified the use of fuel energy.
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7000
6000
5000
4000
3000
2000
1000
0
60000
40000
20000
Tera Joule
80000
Producción
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
0
2004
Kton de Cobre fino
Consumo de Combustible
Combustible
Figure 22: Annual fuel consumption
Source: COCHILCO figures and USM S.A. estimates.
The main fuel used in the mining industry is diesel oil, with 79.6%, followed by
ENAP 6 (Fuel Oil 6), with 16.7% and, with a much lower percentage, natural gas.
Combustibles Utilizados en la Minería
Gas Natural
2%
Otros
2%
ENAP 6
17%
Petróleo Diesel
79%
Figure 23: Fuels used in mining
Source: Consumo de Energía y Emisiones de Gases de Efecto Invernadero de la minería del Cobre de Chile,
COCHILCO.
For its part, the cost of fuel has witnessed a dramatic rise in recent years, in line
with the international events of the commodities market. This situation drove the
price of oil to record levels in July 2008, representing a 37% increase for the
industry between 2007 and 2008.
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Thus, in 2008, the cost of energy in the mining industry climbed to over US$2
billion, up almost 15% on the previous year.
To estimate fuel costs for the coming years, long-term annual variations (20
years) were used as a price projection, since this maintains the trend and
eliminates any occasional distortions.
Hence, average annual fuel consumption is estimated at 66,000 [terajoules],
representing an expenditure of US$1.562 billion per year over the next decade,
although a peak of 70,228 [terajoules] is observed in 2013 due to increased levels
of production for this year.
Demanda
de Energía
Energía
Costo de
US$ Millones
3000
2500
2000
1500
1000
500
0
2000
Energía
2005
Combustible
2010
2015
Energía Proyectado
2020
Combustible Proyectado
Figure 24: Projected energy costs
Source: COCHILCO figures and USM S.A. estimates.
As a general observation on electricity and fuel, note that demand will increase as
the various projects described begin operation. Nonetheless, although supply can
be guaranteed, we need to bear in mind that the fuels used are fossil fuels and
that the electricity comes mainly from power plants that use these fuels. So, as
explained above, criticality will come into play when the carbon footprint begins
to gain momentum. From this point on, the pro-activeness of the mining
companies in the shift towards NCRE will become relevant in marking the
difference between copper with a "heavy carbon footprint" and one that is "carbon
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neutral" or "low carbon". Given the volumes of energy consumed, this will be no
mean feat.
It is therefore necessary to attract investment with alternative energies to ensure
the competitiveness of Chilean copper.
c) Mining goods and inputs
To determine the level of consumption of the main Mining Goods and Inputs, we
use a methodology based on projected production and mineral grade and on
recovery rate. These will be used to project the amount of ore to be treated in the
concentration processes (via flotation) and hydrometallurgical processes, and
hence, to determine the requirements of the latter.
A
gradual
increase
is
envisaged
in
the
amount
of
ore
to
undergo
hydrometallurgical processing over the next 10 years, which looks set to stand
somewhere around 400 million tonnes by 2019, approximately 24% above the
value of 2010.
For flotation concentration, the situation is intensified further, since it is projected
that by 2019 the amount of ore to be processed will exceed 1 billion tonnes. This
would be due to the impoverishment of the ore grade and the increase in
projected production. As a result, a gap is opened that must be covered by a
significant increase in current production capacity.
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Mineral a Remover
1600
1400
1200
1000
800
600
400
200
0
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2016 2017 2018 2019
Mineral a Remover Flotación
Mineral a Remover Hidrometalurgia
Figure 25: Mineral to be processed
Source: USM S.A. estimates based on COCHILCO data and Brook Hunt database.
d) Reagents for hydrometallurgy
The estimated amount of mineral to be processed for 2010 is 324 million tonnes,
which is projected to increase to 403 million tonnes in 2019. This significant
increase will have an impact on the requirements for inputs and chemical reagents
for the treatment of these new levels of ore. This calculation uses the values in the
Guía de Ingeniería y operaciones Mineras de Chile (Guide to Engineering and
Mining Operations in Chile), published by Portal Minero, as unit consumption
values.
Ácido Sulfúrico [g/ton]
Aditivo Guarfloc [g/ton]
Extractantes [g/ton]
Sulfato de Cobalto [g/ton]
Diluyente [l/ton]
Cons.
US$/ton
Unitario
3,1
60
0,2
5780
0,175
3000
1,02
8100
10,7
670
Table 5: Unit hydrometallurgy reagent consumption
Source: Guía de Ingeniería en Operaciones Mineras, Portal Minero.
The biggest expense is for sulphuric acid, which annually accounts for over
US$300 million. The demand for sulphuric acid increased by 20% between 2004
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and 2009, so companies had to turn to outsourcing, mainly through the Interacid
Trading company. The latter is planning to set up an acid production plant in
Norte Grande that would bridge the gap between demand and local production
over the coming years.
Proyección Reactivos Hidrometalurgia
(Millones de US$)
2004
2009
2014
2019
500,0
400,0
300,0
200,0
100,0
-
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
70,0
60,0
50,0
40,0
30,0
20,0
10,0
-
Aditivo Guarfloc
Extractantes
Diluyente
Ácido Sulfurico
Sulfato de Cobalto
Figure 26: Projection of hydrometallurgy reagents
Source: COCHILCO figures and USM S.A. estimates.
Demand for this input is expected to continue to rise over 2010-2019, with an
annual expenditure of US$370 million and a peak estimated value of US$410
million, which would occur in 2012.
The second biggest expenditure in this period will be for extractants, with an
average cost of US$28.2 million per annum, followed by diluents, with the sum of
US$14.2 million, copper sulphate with US$11.7 and lastly, the additive Guarfloc,
with an average cost of US$1.2 million per year.
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e) Flotation reagents
The unit consumption of the main chemical reagents used in the flotation process
is indicated in the following table:
Floculante [g/ton]
Espumantes [g/ton]
Colectores [g/ton]
Cal [g/ton]
Consumo
US$/ ton
Unitario
20
2500
30
2200
35
2000
1500
100
Table 6: Flotation unit consumption
Source: Guía de Ingeniería en Operaciones Mineras, Portal Minero.
The biggest expense in the flotation concentration process is lime, which
represents 45% of the cost of reagents, with a projected average spending of
US$ Millones
US$61.6 million over the next 10 years and a peak of US$66.1 million in 2016.
Reactivos Flotación
160
140
120
100
80
60
40
20
0
Floculante
Espumantes
Colectores
Cal
Figure 27: Projected expenditure on reagents for flotation
Source: COCHILCO figures and USM S.A. estimates.
The second biggest expenditure after lime is collectors, with an average annual
total of US$28.7 million, followed by foaming agents with US$27.1 million and
lastly flocculating agents, with an average of US$18.5 million per year.
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f) Grinding balls and steel plate
As with reagents, it is possible to determine the levels of future consumption
based on average yields per tonne of copper produced.
Bolas de Molienda
Aceros de Revestimiento
Consumo
US$/ ton
Unitario
775 0,000073
150
0,0002
Table 7: Unit consumption of steel balls and steel plate
Source: Guía de Ingeniería en Operaciones Mineras, Portal Minero.
The largest sum corresponds to grinding balls, with an average cost of US$232
million a year, representing 47% of total input costs for flotation.
Consumo de Aceros
US$ Millones
300,0
250,0
200,0
150,0
100,0
50,0
-
Bolas de Molienda
Aceros de Revestimiento
Figure 28: Projected steel consumption
Source: COCHILCO figures and USM S.A. estimates.
For its part, steel plate totals an annual average of US$123 million over the period
and accounts for 25% of total inputs for concentration by flotation.
g) Material to be removed
To project demand for mining equipment, tyres and explosives, it is essential to
estimate the material to be removed both in opencast mines and in underground
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operations. To do this, we use the average sterile/mineral ratio for each year,
which, combined with the projected production, allow us to quantify the levels of
material removed.
Material a Remover
6.000
Millones de Toneladas
5.000
4.000
3.000
2.000
1.000
-
Material Estéril
Mineral a Remover
Figure 29: Projected material to be removed
Source: COCHILCO figures and USM S.A. estimates.
h) Mining equipment
To estimate mining equipment, we used data considered to be representative of
the industry. Hence, data recorded at Codelco Norte on equipment performance
and operation factors were used.
6.2.a.1
Mining trucks
To determine the haulage requirements of material from opencast mines, the
average yields, availability and costs associated with 330 tc trucks were used, as
this is one of the latest models in Chile.
Rendimiento
Disponibilidad
Uso Disponible
Rendimiento
Costo de Inversión
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Table 8: Truck performance
Source: Guía de Ingeniería en Operaciones Mineras, Portal Minero.
An increase of 596 units is projected in the number of haulage trucks between
2010 and 2019 since, in order to cover the increased requirements, the fleet
would need to increase from the 963 trucks in 2010 to the 1,559 units in 2019.
This would require an investment of approximately US$2.086 billion.
Parque de Camiones
1.800
1.600
Unidades
1.400
1.200
1.000
800
600
400
200
-
Figure 30: Projected mining-truck fleet
Source: COCHILCO figures and USM S.A. estimates.
6.2.a.2
Loading equipment and opencast drilling machines
As above, the increase in material to be removed leads to growth in the demand
for drilling and loading equipment, thus generating an increase in the current
fleet. Upon analysis of the average performance of this equipment, we obtain the
following data.
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Rendimiento Palas
Disponibilidad
88%
Utilización
95%
Factor Operacional
77%
Rendimiento Medio Nominal
6921 t/hr. Efec.
Costo de Inversión
US$ 17 millones
Table 9: Shovel loader performance
Source: Guía de Ingeniería en Operaciones Mineras, Portal Minero.
The increased demand in this mining equipment is expected to occur by the
middle of the next decade due to execution of major mining projects in this
period, including Phase V of Escondida and Expansion Phase II of Andina.
Demanda de Equipos Mineros
80
70
60
50
40
30
20
10
0
200420052006200720082009201020112012201320142016201720182019
Perforadoras
Cargadores Frontales
Palas de Carguío
Figure 31: Projected demand for mining equipment
Source: COCHILCO figures and USM S.A. estimates.
Thus, on average, 31 mining machines will be required each year from 2010 to
2019. Of these, 9 will be drilling machines for opencast mines, 15 will be front
loaders and 7 will be shovel loaders. This represents an annual investment of
around US$58 million in front loaders and US$31 million in shovel loaders.
b)
Tyres
By estimating the trend in the haulage truck fleet used in Chile, with an average
cost per vehicle of US$20,000, it is possible to estimate the demand and sums
incurred by companies for this heading.
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300
14000
250
12000
10000
200
8000
150
6000
100
4000
50
Unidades
US$ Millones
Neumáticos
2000
Costo de Neumáticos
2019
2018
2017
2016
2015
2014
2013
2012
2011
2010
2009
2008
2007
2006
2005
0
2004
0
N° Neumáticos
Figure 32: Projected demand for tyres
Source: COCHILCO figures and USM S.A. estimates.
Hence, a 10% increase can be observed in the number of units over the past 5
years and an annual consumption of 10,407 tyres is expected over the next
decade, requiring a total of US$208 million.
c)
Explosives
The average unit consumption of explosives at an average cost of US$650 per
tonne of input has been used as a load factor for this projection. Thus, an annual
consumption of 648,526 tonnes of explosives is projected, which would require
an investment of around US$422 million per year.
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Explosivos
800.000
600.000
400.000
200.000
Toneladas
1.000.000
-
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
US$ Millones
600
500
400
300
200
100
-
Costo Explosivos
Explosivos
Figure 33: Projected consumption of explosives
Source: COCHILCO figures and USM S.A. estimates.
6.3
Regional market
By way of example and in order to exhibit greater potential of attraction to
possible suppliers wishing to set up operations in Chile, the size of the market is
described for two strategic inputs, taking into account some of the countries of
the Southern Cone. The specific consumption of these inputs per tonne of copper
produced in each country was used as the benchmark to estimate market size.
Suministro
Neumático (MMUS$)
Bolas Molienda (MMUS$)
Chile
282,00
211,68
Perú
63,80
47,93
País
Argentina
95,81
71,89
Brasil
53,23
39,93
Table 10: Projected supply market
Source: Prepared by USM S.A. based on various public sources.
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7 Critical supplies for mining
Drawing on the value chain illustrated in Annex 5, Figure 34 below shows a matrix
with various supplies considered to be critical, based on the results of the
interviews and analysis of the information gathered by the team. They have been
considered critical because a reduction in supply or lack of the latter has a
significant impact on mine operation.
Figure 34: Critical supplies for mining
Source: Authors.
For each of the inputs, aspects were identified that make them critical to
operation of the mine. In each case, a selection of initiatives is put forward to
mitigate the scenario of criticality analysed.
In the case of the transportation of ore and intermediate materials, the critical
supplies are thermal energy (associated with fuel) used for truck movement, tyres,
operational services and maintenance services, as illustrated in Figure 35.
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 Energía térmica (combustible)
o Dependencia energética
o Distancia de los centros de consumo desde los
centros de distribución
o No intercambiabilidad de combustible
o Antigüedad de yacimiento: incremento de
consumo por aumento de material base y
desplazamiento
 Neumáticos
o Pocos productores
o Puntos de fabricación y distribución alejados de
centros de consumo
o Impacto directo en el core del negocio
o Disponibilidad (durabilidad)
o Antigüedad del yacimiento: incremento del
desplazamiento
 Mitigación
o Cambio tecnológico (utilización de cintas
transportadoras)
o Estación de transferencia
 Servicios de operación
o Intensivo en mano de obra (4 - 5 operadores)
 Mitigación
o Manejo remoto / robótica aplicada
 Servicios de mantenimiento
o Impacto en la disponibilidad
o Incremento de la flota: mayor costo directo de
mantenimiento

o
o
o

o
o
o
Mitigación
Mejoramiento de caminos
Monitoreo de presión de aire
Nuevo tipo de neumático (sin aire)
Mitigación
Servicio de mantenimiento especializado
Repuestos in situ
Manejo stock crítico de repuestos
Figure 35: Criticality in the haulage of ore and intermediate material
Source: Authors.
In crushing and grinding mining processes, the most critical inputs are related to
grinding balls, maintenance services and water supply.
Bolas
o Impacto directo en el core del negocio
o Disponibilidad (por durabilidad de bolas)
o Aumento de lucro cesante por cambio de bolas
(equipo)
Mitigación
o Aumento de durabilidad del material
o Cambio de paradigma (llevar el proceso de
chancado al material)
Servicio de mantenimiento
o Impacto en la disponibilidad
Mitigación
o Servicio de mantenimiento especializado
o Repuestos in situ
o Manejo stock crítico de repuestos
Agua
o Baja disponibilidad del recurso
o Impacto ambiental por generación, manejo y
disposición de riles
Mitigación
o Reutilización de agua de procesos
o Reutilización de aguas sanitarias
Figure 36: Critical supplies in crushing and grinding
Source: Authors.
In flotation, the most important supplies are electricity and operational services,
since both are directly linked to the core business of the mining industry.
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Energía eléctrica
o Impacto directo en el core del negocio
Mitigación
o Modificación de la matriz de energéticos
primarios
Servicios operacionales
o Impacto directo en el core del negocio
Mitigación
o Automatización
Figure 37: Critical supplies in the flotation process
Source: Authors.
Another relevant aspect is that associated with human resources. The main
reasons relate to the lack of interest among young professionals in working at
sites. Another important aspect is safety, to which the mining industry allocates
many resources each year in order to try and prevent or at least reduce the
frequency of events, especially those relating to personal safety.
Servicio de campamento
o Hotelería crítico para las personas
o Disponibilidad de agua sanitaria, energía
eléctrica
o Higiene (desagües y residuos “domiciliario”
o Desarme de faenas
Mitigación
o Campamentos mecanos (prearmados)
Selección y capacitación
o Menor disposición de profesionales jóvenes a
trabajar en faena y en turnos
o Formación universitaria: principalmente teórica
y sin carreras orientadas al negocio minero
Mitigación
o Automatización
o Control remoto del proceso/robótica
o Formación especializada y focalizada en el
negocio (formación dual)
o Transferencia tecnológica
Agua
o Baja disponibilidad del recurso
o Crítico para la subsistencia (agua potable)
o Aguas sanitarias (salud e higiene)
Mitigación
o Tratamiento de aguas residuales
o Reutilización de aguas sanitarias
o Separación de aguas fecales
Figure 38: Critical aspects of personnel at sites
Source: Authors.
In the case of prospecting and operation, one relevant fact is that related to the
supply of chemical reagents and explosives in particular, as there are only two
suppliers in the domestic market, a scenario that does not help with the
competitiveness of mining.
The entry of a new player on the market will be no mean feat given the level of
penetration of the existing suppliers and the conditions of distribution of the
market. Another point that will impede the entry of new suppliers is that the
mining industry is seeking solutions, not isolated products or inputs. In the case
of the supply of explosives, what is being supplied on the market are services at
the mine itself.
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Servicios operacionales
o Servicio especializado
Mitigación
o Formación especializada y focalizada en el
negocio (formación dual)
o Transferencia tecnológica
Químicos reactivos y explosivos
o Bajo poder de negociación de mineras
Mitigación
o Atracción de nuevos proveedores
Figure 39: Critical aspects in prospecting and operation
Source: Authors.
The team's research revealed that some supplies are not being served locally, as
shown in the figure below.
Suministros Estratégicos
Bienes y Servicios de Apoyo
• Robótica aplicada
• Innovaciones en equipos mineros
• Innovaciones en insumos
• Gestión de aguas
• Monitoreo de taludes
• Servicios logística de entrada
•
•
•
•
Tribología
Explosivos
Bolas de molienda
Reactivos químicos (extractante,
colectores, sulfato de cobalto, NaSH)
• Energía
•
•
•
•
•
•
•
•
•
Neumáticos
Combustibles
Lubricantes
Reactivos químicos (flotación)
• Sistemas de automatización y control
• Sondajes mineros
• Monitoreo ambiental
•
•
•
•
Equipos mineros
Correas transportadoras
Aceros revestimiento
Geotextiles
•
•
•
•
•
•
Servicios de alimentación
Telecomunicaciones
Estanques
Aseo industrial
Zunchos
Bombas
Válvulas
Construcción
Ingeniería
Transporte de personas
Mantenimiento
Figure 40: Number of suppliers with a local presence
Source: Authors.
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8 Potentially successful cases
There are some cases that could be successful and whose experience could be
adapted to other strategic mining supplies in Chile. Note that the initiatives being
driven by CORFO are on the right track towards attracting new players to supply
the mining industry, by gathering them at a single event with the key producers
on the local market and explaining the near future.
Three notable stories of success now follow:
a) Treatment of grinding bars
In Chile, steel bars are only sold without heat treatment, supplied exclusively by
CAP in ex-works deliveries. In the international market, there is a limited supply
of such bars.
These processes applied to the metals are designed to improve their mechanical
properties, most notably hardness, strength and toughness. The materials that
are heat-treated are basically steel and grey cast iron composed of iron and
carbon.
The mechanical properties of steels reside in the chemical composition of the
alloy and the type of heat treatment applied to them.
The heat treatment used is cementing, which increases the surface hardness of
the bar associated with an increased concentration of carbon in the peripheral
area of the bar. Subsequently, through quenching and tempering, a high surface
hardness is obtained, together with resistance to wear and a tough core.
This opportunity for success is illustrated in the material shown in the figure
below:
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¾” (18mm)
52 Rockwell C
39 Rockwell C
27±4 Rockwell
C
27±4 Rockwell C
Figure 41: Representation of the effect of treatment on the material
Source: Authors.
b) Phosphorus pentasulphide
This is a chemical compound (P4S10) that is yellow in colour. It is an important
compound in the agrochemical and mining industries. It is manufactured as flakes
and used in several areas:
•
•
•
Intermediary in insecticide production.
Mineral flotation agent.
Lube oil additive.
In the case of Codelco, for example, the only supplier of phosphorus
pentasulphide is Fosfoquim S.A. This circumstance has resulted in a strategic
relationship of supply logistics (customer-supplier relationship) that includes the
development of technology for risk prevention and productive efficiency.
Together, they have developed waste plants and special containers for the safe
handling of P4S10.
Other companies have been identified as potential suppliers:
 National suppliers
• Merck S.A (www.merck.cl/es/company/merck_in_chile_sa/merck_sa.html).
• Perez & Jacard (www.portland.cl/).
 Foreign companies:
• Tekchem (Mexico) (www.tekchem.com.mx).
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• Thermphos/Sudamfos S.A (Argentina)
(www.thermphos.com.cn/tianfu/en/index.asp).
• Chemtrade Logistic (Canada) (www.chemtradelogistics.com).
c) Industrial cleaning
The mining companies currently use a Roto Power with brush and shovel. Abroad,
technical mechanisms are used for dust collection, including the aspiration of
dust in underground mines, aspiration of particulate material spills, cleaning of
material build-up underneath operating equipment, cleaning of dust and debris
from smelting and refining.
The suppliers with industrial cleaning technology present in the US market
include:
• Clean Earth Environmental Group
(www.edainc.net/PastSuccess/ceeg/ceeg.aspx).
• MET–PRO CORPORATION (www.met-pro.com/).
• MPW (www.mpwservices.com/).
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9 Strategies for attraction
To generate optimal and attractive conditions for foreign investment in Chile, it is
important to identify aspects that, from the point of view of investors, make the
country a market with security guarantees. Thus, the following SWOT analysis will
help to identify elements that need to be overcome (weaknesses) and that need to
be exploited (strengths). A summary is provided below.
Fortalezas
• Chile, con el mayor índice de potencial
político (PPI)* de Latinoamérica.
• Baja incertidumbre sobre la administración
y aplicación de las regulaciones vigentes.
• Políticas basadas en las “mejores
prácticas”, dando apertura económica.
• Régimen de aprobación ambiental
transparente, da paso a la inversión.
• Red de apoyo a la inversión.
• Estabilidad política
Debilidades
• Potenciales problemas de lenguaje
• Bajos niveles de inversión en
innovación y desarrollo
• Presencia de “carteles”
• Debilidad de ley de protección a la
propiedad intelectual
• Inestabilidad en países vecinos
Oportunidades
• Aumento de producción por alto precio del
cobre
• Chile, país con mayores reservas de cobre
• Crecimiento de negocios en países de la
región
• Búsqueda de soluciones, no de productos
Amenazas
• Alza en los precios de los commodities
por la recuperación de la economía.
• Bajo crecimiento económico
• Rigidez del mercado laboral
• Guerra de precios
• Impacto por cambio de mando
Figure 42: SWOT analysis to attract investment
Source: Based on Survey of Mining Companies 2008/2009 (Fraser Institute Annual) and other public sources.
The view of Chile as reflected in the PPI index that measures the effects of
government policies is important. This should allow the attraction of investors
supplying strategic inputs, given that, from Chile, it is possible to approach the
growing mining market developing in Peru and the initiatives of other countries
like Colombia, which seeks to become a major player in global mining.
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One general aim should be that of generating sustainable optimal conditions to
encourage investment by foreign companies in Chile and to promote both the
regions and the mining cluster.
Based on the above, the specific aims are as follows. The monitoring indicators
and proposed targets are indicated in Figure 44.
1. Promote Chile as a platform for the generation of mining business
throughout the Southern Cone. The various potential foreign suppliers
should be shown the benefits of investing in the country, such as its
political, economic and social stability.
2. Bridge existing technology gaps through technology entrepreneurship and
investment by businesses that supply new technologies applied to mining.
3. Develop public, private and mixed tools and incentives to generate the ideal
conditions for the entry of foreign investment to the country.
4. Define lines of action to encourage progressive improvements in the
national panorama.
CORFO and its various agencies are considered responsible for driving
implementation of the strategy. However, it must be a countrywide strategy in
which all of the public instruments work together to seek the effective attraction
of suppliers.
To this end, besides the review of international initiatives, road shows,
promotional fairs and visits to suppliers, among other events, the actions
currently promoted by CORFO should be continued.
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Figure 43: Aims, targets and monitoring indicators
Source: Authors.
In the light of the above, nine basic aspects must be guaranteed to facilitate
foreign investment in Chile:
a. Guarantee a sufficient volume of current and projected business
o
Promote regional interest while maintaining Chile as the productive
and operational platform.
o
Encourage the creation of specialised clusters that can be developed
in the regional market with a local base.
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o
Send out clear signals regarding the relevant size of the specific
market.
b. Guarantee access to stable and mature financial markets
o
o
o
Guarantee a stable financial market.
Encourage access to credit at preferential rates (IDB, CORFO, etc).
Well-regulated financial system with high and reliable operating
standards.
c. Minimise investor risk through economic, political and social stability
o Promote clarity in the labour market and in wages.
o
o
o
o
Send out signals of a clear regulatory framework.
Facilitate the flow of relevant economic information to investors.
Limit currency risk (controlled exchange rate, hedging instruments).
Reduce social tensions in productive areas.
d. Guarantee stability in the short, medium and, most importantly, long term
o
Send out signals of seriousness, integrity and institutional agility in
economic, financial and legal affairs.
o
o
o
Set up regional agreements to ensure stability.
Promote investor confidence in the country.
Show signs of seriousness, stability and open government.
e. Offer clear conditions of national competitiveness
o
Develop an "Investor's Manual" with practical information for
companies wishing to set up operations in Chile.
o
Provide guarantees of competitiveness and benefits for foreign
investment.
o
o
Provide clear signs of free-market reform.
Generate a plan to privatise inefficient state enterprises.
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f. Improve or at least maintain the conditions that exist in the country of
origin
o
Generate an adequate level of technical education and language
learning.
o
Implement globally accepted accounting practices with control
measures accepted by other duly developed markets.
o
Remove barriers to international trade in business, taxation, etc.
g. Generate guarantees for operation and access to the local mining market
(state and private)
o
Host road shows and thematic fairs that link mining companies to
international
strategic
competitiveness.
o
suppliers,
focusing
on
areas
of
low
Guarantee competitiveness, with limited costs similar to those
available abroad.
o
o
Incentivise remittances sent to parent companies.
Build adequate infrastructure for the implementation and expansion
of productive activities (roads, ports, energy, etc).
o
Promote the incorporation of new suppliers in state enterprises so as
to introduce them gradually to the market.
h. Create clear, competitive national advantages
o
Develop public instruments to attract investment (subsidies,
benefits, etc).
o
tax
Develop institutional partnerships (universities, technology centres,
CORFO, etc).
o
o
o
i.
Create tax holidays - extension of free trade zones.
Promote innovation through subsidies or other mechanisms.
Encourage the association of producers using available synergies.
Consolidate the country's policy on international investment agreements
o
Increase FTAs and agreements to promote and protect investments.
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o
Seek out companies interested in the international projection of their
products.
o
Encourage inter-government agreements on technology exchange
and the mutual development of markets.
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10 Concluding remarks
The figures relating to projects in the industry show no signs of a crisis. The
reasons for this are varied and range from the need to remain in business and not
disappear to taking increasingly stronger and profitable positions in a country
that is still a major player when it comes to copper production.
CORFO's opportunities for attracting new players are clear. Supplies such as
applied robotics, innovations in mining equipment and supplies do not have a
local presence. The same applies to the management of water, a scarce resource,
particularly in the north of the country. The same can also be said of slope
monitoring.
Other supplies have suppliers in the local market but their offers cannot
guarantee the competitiveness of mining.
The need is obvious. The types of supply are obvious. A series of suppliers have
now been identified. Some have already been contacted both by companies and by
CORFO.
Hence, CORFO needs to approach the mining companies with a view to building a
permanent project together, using all of its lines and promotional instruments,
just as it has done with Innova, for example. Mining companies are eager to have
more suppliers competing in a context of economic and political stability such as
that witnessed in Chile.
CORFO must also interact with its counterparts in neighbouring countries in order
to identify and group common needs to offer attractive market sizes to investors.
It must lead this movement to ensure that those interested in reaching the South-
American market set up operations in Chile and from there, supply the mining
market of the region.
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Bibliography
•
•
Antofagasta PLC. “Annual Report 2008”, Antofagasta PLC, 2009.
CESCO, “Desarrollo de la Industria Minera en América Latina”, Centro de
Estudios del Cobre, Chile, 2009.
•
COCHILCO. “Anuario de Estadísticas del Cobre y Otros Metales 19992008”, Comisión Chilena del Cobre, Chile, 2009.
•
COCHILCO. “China: Desarrollo Económico y Consumo de Cobre”, Comisión
Chilena del Cobre, Chile, 2009.
•
COCHILCO. “Coeficientes Unitarios de Consumo de Energía de la Minería
del Cobre 2001-2007”, Comisión Chilena del Cobre, Chile, 2008.
•
COCHILCO.
“Consumo
de
Energía
y
Emisión de
Invernadero”, Comisión Chilena del Cobre, Chile, 2009.
•
Gases
de
Efecto
COCHILCO. “Demanda de Energía Eléctrica y Seguridad de Abastecimiento
en la Minería del Cobre”, Comisión Chilena del Cobre, Chile, 2008.
•
COCHILCO. “El Mercado del Ácido Sulfúrico y su Proyección al 2015”,
Comisión Chilena del Cobre, Chile, 2009.
•
COCHILCO. “Inversión en la Minería del Cobre y del Oro Proyección Período
2009-2013”, Comisión Chilena del Cobre, Chile, 2009.
•
COCHILCO. “Oportunidades de Negocio para Proveedores de Bienes,
Insumos y Servicios Mineros en Chile”, Comisión Chilena del Cobre, Chile,
2008.
•
CODELCO, “Memoria Corporativa 2008”, Corporación Nacional del Cobre,
Chile, 2009.
•
•
•
•
•
COLLAHUASI. “Memoria Anual 2007”, Collahuasi, Chile, 2008
Consejo Minero. “Informe Económico 2007”. Chile, 2007.
EDITEC. “Catastro de Proyectos Mineros”, EDITEC, Chile, 2009.
Minera Escondida. “Memoria Anual 2007”, Minera Escondida, 2008.
Portal Minero S.A., “Guía de Ingeniería en Operaciones Mineras”, Portal
Minero Ediciones, Chile 2007.
•
Valenzuela, A., Arias, M., “Oportunidades de Negocio en la Minería del
Cobre. Potencial Demanda de Bienes e Insumos Mineros”. Comisión Chilena
del Cobre, Chile 2005.
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Websites. Sources of information
•
•
•
http://www.portalminero.com/proyectos/muestra_all_proyecto.php
http://www.abastemin.cl
http://www.aminera.cl/contenido/companias-mineras-y-proveedorespor-una-relacion-consolidada.html
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•
http://www.finning.cl
http://www.aprimin.cl
http://www.iimch.cl
http://www.portalminero.cl
http://www.cesco.cl
http://www.cochilco.cl
http://www.editec.cl
http://www.sonami.cl
http://www.collahuasi.cl
http://www.escondida.cl
http://www.codelco.cl
http://www.enami.cl
http://www.anglochile.cl
http://www.bcentral.cl
http://www.barrick.cl
http://www.exponor.cl
http://www.cbc.cl
http://www.aia.cl
http://www.estrategia.cl
http://www.minmineria.cl
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Annexes
Annex 1. Websites. Suppliers
•
•
•
www.mobiusinstitute.com
www.swannglobal.com
www.amcconsultants.com.au
• www.salveresources.com
•
www.h2oceanpower.com
• www.asa-australia.com
•
www.engen.com.au
• www.crescent-pps.com
• www.apssystemms.com.au
•
www.mpe.com.au
• www.bigtyre.com.au
•
www.itpower.co.uk
• www.itpon.com.au
•
www.klinge.com.au
• www.croctyres.com.au
• www.acfr.usyd.eder.au
•
•
•
•
•
www.acumine.com.au
www.sunemporium.com
www.broons.com
www.mmdsizers.com
www.controlsystems.com.au (already in Chile)
• www.jda.com.au
• www.trensfieldservices.com (with Inser)
•
•
•
www.adaptfms.com
www.maunsell.com
www.smec.com.au
• www.enviroflow.com.au
•
•
www.isipl.com
www.groundwatertech.com
• www.clemente.com.au
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•
•
•
www.grd.com.au (already in Chile)
www.groundprobe.com
www.owencustomproducts.com.au
• www.a-i-t.com.au
• www.birrena.com.au
•
•
•
•
•
•
www.sageautomation.com
www.biocentral-labs.com
www.globedvill.com.au
www.argontechnology.com.au
www.walenex.com
www.metropower.com.au
• www.scananalyse.com.au
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Annex 2. State of mining investment projects
Año Operación
2009
2010
2011
2012
2013
2014
2015
2017
2018
-
Operador
Centenario Copper
Pucobre
Codelco
Codelco
Codelco
Codelco
Antofagasta Minerals
Antofagasta Minerals
Antofagasta Minerals
Collahuasi
Teck
Vale a través de CMLA
Anglo American
Sinocoop, Tongling Group
Cerro Dominador
Xstrata
Pan Pacific Copper
Antofagasta Minerals
Freeport-McMoran - Codelco
Codelco
Codelco
Teck
Xstrata
BHP
Andes Copper
Quadra Mining
Codelco
Codelco
Codelco
Sinocoop, Tongling Group
Sinocoop, Tongling Group
Faena
Franke
Expansión Doña Agi
Pilar Norte (Teniente)
Expansión Gaby Fase II
Expansión Fase I (Andina)
Radomiro Tomic (Sulfuros)
Esperanza
Antucoya
Ampliación Fase II (Los Pelambres)
Ampliación Fase I
Andacollo Hipógeno
Tres Valles
Expansión Los Bronces
Minera Catania Verde (Fase I)
Diego de Almagro
Lomas Bayas II
Caserones
Los Pelambres (Ampliación)
El Abra Sulfolix
Mina Ministro Hales
San Antonio Óxidos (Salvador)
Relincho
El Morro
Escondida Fase V
Vizcachitas
Sierra Gorda
Expansión Fase II (Andina)
Nuevo Nivel Mina (Teniente)
Chuqui Subterránea
Minera Catania Verde (Fase II)
Minera Catania Verde (Fase III)
Inversión (MM US$)
172
6,8
120
202
220
382
1900
200
925
750
336
102
1744
25
120
200
1700
3200
450
900
230
1000
2500
3250
1000
1660
4800
1600
1900
30
300
Estado
Confirmada
Confirmada
Confirmada
Confirmada
Confirmada
Confirmada
Confirmada
Postergada
Confirmada
Confirmada
Confirmada
Confirmada
Postergada
Confirmada
Confirmada
Confirmada
Confirmada
Confirmada
Postergada
Confirmada
Confirmada
Confirmada
Confirmada
Postergada
Confirmada
Confirmada
Confirmada
Confirmada
Confirmada
Confirmada
En evaluación
Table 11: Breakdown of mining projects
Source: Prepared by USM S.A. based on information from Cesco, COCHILCO and various public sources.
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Annex 3. Methodology for estimating amounts for supplies
Proyecciones
de
Producción
Estimación
Energía y
Combustibles
Proyección Sx-Ew
No
Tratamiento por
Flotación?
Si
Proyección de
Concentrados
Proyección de Ley
y % de
Recuperación
Proyección de Ley
y % de
Recuperación
Mineral a
Procesar
Mineral a
Procesasr
Estimación
Reactivos
Mineral Total a
Procesar
Estimación
Reactivos y Bolas
de Molienda
Proyecciones
Relación EstérilMineral
Material a
Remover
Estimación
Equipos Mineros y
Explosivos
Fin
Figure 44: Methodology for estimating demand
Source: Prepared by USM S.A.
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Producto
Concentrados Base
Producción Base
Cátodos Sx-Ew Base
Total Producción Base
Concentrados Nuevos
Producción Nueva
Cátodos Sx-Ew Nuevos
Total Producción Nueva
Concentrados
Producción Proyectada
Cátodos Sx-Ew
Total Producción Proyectada
2004
3.776
1.636
5.413
1.636
5.413
2005
3.736
1.585
5.321
1.585
5.321
2006
3.669
1.692
5.361
1.692
5.361
2007
3.725
1.832
5.557
1.832
5.557
2008
3.357
1.974
5.330
2009
3.309
1.940
5.249
1.974
5.330
35
35
3.309
1.975
5.284
2010
3.389
1.979
5.368
201
154
355
3.590
2.133
5.723
2011
3.267
1.811
5.078
415
196
611
3.682
2.007
5.689
2012
3.155
1.786
4.941
552
423
975
3.707
2.209
5.916
2013
3.178
1.663
4.841
1.114
500
1.614
4.292
2.163
6.455
2014
2.876
1.456
4.332
1.359
505
1.864
4.235
1.961
6.196
2015
2.736
1.401
4.137
1.619
505
2.124
4.355
1.906
6.261
2016
2.727
1.317
4.044
1.677
521
2.198
4.404
1.838
6.241
2017
2.624
1.216
3.840
1.741
525
2.266
4.365
1.741
6.105
2018
2.524
1.119
3.643
1.757
865
2.622
4.281
1.983
6.264
2019
2.420
1.018
3.438
1.722
914
2.635
4.142
1.932
6.073
Table 12: Projected production
Source: Prepared by USM S.A. based on information from Cesco, COCHILCO and various public sources.
Concentración
Lixiviación
Promedio Chile
2004 2005 2006 2007 2008 2009
1,21
1,17
1,19
1,18
1,13
1,10
0,89
0,84
0,83
0,91
0,85
0,81
1,09
1,05
1,06
1,06
1,00 0,99
2010
1,01
0,75
0,91
2011
0,96
2012
0,94
2013
0,90
2014
0,87
2015
0,88
2016
0,79
0,72
0,70
0,67
0,65
0,60
0,62
0,85
0,82
0,79
0,79
0,74
0,88
Table 13: Copper grade in mining operations in the country
Source: Prepared by USM S.A. based on information from Cesco, COCHILCO and various public sources.
2017
0,78
0,64
0,74
2018
2019
0,76
0,75
0,67
0,68
0,73
0,73
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Table 14: Mineral and material to be removed
Source: Prepared by USM S.A. based on information from Cesco, COCHILCO and various public sources.
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Consumo Energ. Elec.
Costo Energía Electrica
Consumo Combustibles
Costo Combustibles
2004
16.178
726
41592
627
2005
16.281
730
40164
605
2006
16.422
737
41998
633
2007
15.429
692
47998
723
2008
14.435
648
58600
883
2009
13.110
588
60624
914
2010
11.784
529
62.649
944
2011
13.034
585
62.145
937
2012
14.451
648
64.498
972
2013
17.002
763
70.222
1.058
2014
18.209
817
67.262
1.014
2016
21.445
962
67.473
1.017
2017
22.766
1.021
65.863
993
2018
24.845
1.115
67.437
1.016
2019
25.545
1.146
65.243
983
Table 15: Energy consumption
Hidrometalurgia Flotación
Source: Prepared by USM S.A. based on information from Cesco, COCHILCO and various public sources.
Reactivos
Floculante
Espumantes
Colectores
Cal
Ácido Sulfurico
Aditivo Guarfloc
Extractantes
Sulfato de Cobalto
Diluyente
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
19
19
18
19
17
17
18
18
19
21
21
22
22
22
21
21
25
25
24
25
22
22
24
24
24
28
28
29
29
29
28
27
26
26
26
26
23
23
25
26
26
30
30
30
31
31
30
29
57
56
55
56
50
50
54
55
56
64
64
65
66
65
64
62
304,4 294,7 314,7 340,8 367,1 367,4 396,7 373,2 410,9 402,2 364,7 354,4 341,8 323,8 368,9 359,3
1,0
1,0
1,0
1,1
1,2
1,2
1,3
1,2
1,3
1,3
1,2
1,1
1,1
1,0
1,2
1,2
23,2
22,5
24,0
26,0
28,0
28,0
30,2
28,4
31,3
30,7
27,8
27,0
26,1
24,7
28,1
27,4
9,6
11,7
9,3
11,4
10,0
12,1
10,8
13,1
11,6
14,1
11,6
14,2
12,6
15,3
11,8
14,4
Table 16: Reagent consumption
13,0
15,8
12,7
15,5
11,6
14,1
11,2
13,7
10,8
13,2
10,3
12,5
Source: Based on data from COCHILCO, Guía de Ingeniería en Operaciones Mineras (Portal Minero) and USM S.A. estimates.
11,7
14,2
11,4
13,8
Consultancy for the Identification of Strategic Supplies for Leading Mining Companies
in order to Direct the Promotion and Attraction of Investment
Bolas de Molienda
Aceros de Revestimiento
2004
213,6
113,29
2005
211,4
112,08
2006
207,6
110,07
2007
210,7
111,75
2008
189,9
100,70
2009
187,2
99,27
2010
203,1
107,69
2011
208,3
110,46
2012
209,7
111,21
2013
242,8
128,77
2014
239,6
127,06
2015
246,4
130,65
2016
249,1
132,11
2017
246,9
130,94
2018
242,2
128,44
2019
234,3
124,25
Table 17: Steel consumption
Source: Based on data from COCHILCO, Guía de Ingeniería en Operaciones Mineras (Portal Minero) and USM S.A. estimates.
74
Consultancy for the Identification of Strategic Supplies for Leading Mining Companies
in order to Direct the Promotion and Attraction of Investment
Table 18 Demand for mining equipment
Source: Based on data from COCHILCO, Guía de Ingeniería en Operaciones Mineras (Portal Minero) and USM S.A. estimates.
Table 19: Tyre and explosive consumption
Source: Based on data from COCHILCO, Guía de Ingeniería en Operaciones Mineras (Portal Minero) and USM S.A. estimates.
Consultancy for the Identification of Strategic Supplies for Leading Mining Companies
in order to Direct the Promotion and Attraction of Investment
Annex 4. Relevant mining supplies
Energía
y Comb.
Clases
Categorías
Energía
Combustibles y
Lubricantes
Insumos
Bienes e Insumos Mineros
Equipos Mineros
Equipos de Apoyo
Servicios
Reactivos Químicos
Servicios
Items
Energía
Proveedores Detectados Preliminarmente
Energía de SING y SIC
Combustibles y Lubricantes Shell, Copec, YPF
Neumáticos
Bolas de Molienda
Aceros Revestimiento
Camiones Mineros
Palas Rajo Abierto
Cargadores Frontales
Perforadoras Rajo
Bombas
Válvulas
Automatización y Control
Floculante
Espumante
Colectores
NaSH
Ácido Sulfúrico
Extractantes
Sulfato de Cobalto
Diluyente
Cal
Mantención y generales
Suministro Explosivos
Transporte
Alimentos
Ingeniería
Construcción
Michelin, Goodyear, Bridgestone, otros
Molycop, Proacer
CAP, Aceros Chile
Finning Chile, Komatsu
Bucyrus, Man Takraf
Bucyrus, Komatsu, Finning, Janssen
Bucyrus,WLS Drilling Products
Vulco, KSB, Larox
Fastpack S.A., KSB Chile
Honeywell Chile
Importados de USA e Irlanda
Prod. Nacional e Importación (Interacid Trading)
Oxiquim, Harting, Cognis, Cytec
Inacal, Soprocal
FFE Minerals Chile, Power Train Tech., MABET
Enaex, Orica
Transporte Tamarugal, Tur Bus, FFCC de AFTA.
Compass Catering, Sodexho
Fluor Daniels, CADE IDEPE, Aker Kvaerner, Guíñez Ing.
Extranjeros y Nacionales (Techint, Parina, Salfa Montajes, etc.)
Figure 45: Main supplies identified preliminarily
Source: Prepared by USM S.A. based on figures from COCHILCO and other public sources.
• Servicios
ingeniería
Exploracióón
Exploraci
Geolóógica
Geol
Santiago ∙ Chile
Teléfono (56) 2 3610426
www.usmsa.cl
• Aceros para
perforación
• Agua
• Explosivos
• Equipos de
perforación y
carga
• Repuestos y
• mantenimiento
Extraccióón
Extracci
Mina
Mina
• Camiones
• Neumáticos
• Mantención de
caminos
• Repuestos
• Mantenimiento
camiones
Transporte
Avda Providencia 2331 ∙ Oficina 802 ∙ Providencia
∙ Fax (56) 2 3610425
Agua
Ácido sulfúrico
Geotextiles
Tuberías
Curado
•Bolas de
molienda
•Aceros de
revestimiento
•Agua
•Cal
•Cintas transportadora
Molienda
•
•
•
•
Lubricantes
Lubricantes
Combustibles
Combustibles
•Reactivos
extractantes
•Reactivos tipo
ácido orgánico
•Reactivos ligantes
•Reactivos
sulfatantes
•Diluyentes
•Modificadores
•Correas transportadoras
•Agua
•Ácido sulfúrico
•Aspersores y
•mangueras
Secado y
Fusióón
Fusi
•Filtros
•Cintas transportadora
•Reactivos
espumantes
•Reactivos
colectores
•Reactivos
depresantes
•Modificadores
de pH
•Agua
•
•
•
•
•Cal
•Oxígeno
•Agua
Curado
•Ácido sulfúrico
•Zunchos
Electro
refinacióón
refinaci
Agua
Ácido sulfúrico
Geotextiles
Tuberías
Conversióón y
Conversi
refinacióón
Piro refinaci
Planta
Planta Flotación
Flotación
Extraccióón por
Extracci
solventes
Lixiviacióón
Lixiviaci
Flotacióón
Flotaci
Construcción
Construcción yy Proyectos
Proyectos
Servicios
Servicios de
de Apoyo
Apoyo
II +
+D
D
Mayor incidencia en el uso
Menor o nula incidencia en el uso
Planta
Planta Extracción
Extracción por
por Solventes
Solventes
Energía Eléctrica
Eléctrica
Energía
• Chancadores
• Cintas transportadoras
Chancado
Planta
Planta
Mapa de Procesos
Consultancy for the Identification of Strategic Supplies for Leading Mining Companies
in order to Direct the Promotion and Attraction of Investment
Annex 5. Value chain in the mining industry
Figure 46: Value chain of the mining industry
Source: Authors.
77