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To increase the production capability of the Escondida copper mine in Chile, Rio Tinto has approved US$1.4 billion for two projects supporting this move.
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In a statement, Rio Tinto said the board has approved the so-called Organic Growth 1 Project (OGP 1), which replaces the Los Colorados concentrator with a new 152,000 tonne-per-day plant. It also allows access to the high-grade ore located underneath the existing facilities. Construction of the new plant will be complete within three years.
With the total project cost approximated at US$3.8 billion, Rio Tinto will invest about US$1.2 billion.
Moreover, more financing from Rio Tinto will be allocated for the Escondida Oxide Leach Area Project (OLAP), which involves the construction of a new dynamic leaching pad and a mineral handling system. The project will maintain processing capacity at current levels following the completion of the current heap leach in 2014. OLAP will cost US$721 million (Rio Tinto share US$216 million) with construction expected to commence in July 2014.
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Rio Tinto's investment is expected to be funded through the company's share of Escondida's cash flows.
Rio Tinto is a leading international mining group headquartered in the UK, combining Rio Tinto plc, a London and New York Stock Exchange-listed company, and Rio Tinto Limited, which is listed on the Australian Securities Exchange.
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Rio Tinto's business is finding, mining, and processing mineral resources. Major products are aluminium, copper, diamonds, thermal and metallurgical coal, uranium, gold, industrial minerals (borax, titanium dioxide and salt) and iron ore. Activities span the world and are strongly represented in Australia and North America with significant businesses in Asia, Europe, Africa and South America.
