Codelco confirms Minmetals option on Gaby closed for good

Monday, September 29, 2008

Chile's state-owned copper company Codelco confirmed to BNamericas that Chinese company Minmetals does not intend to exercise its option to acquire 25% of the Gaby mine in region II, following reports that Minmetals had not entirely ruled out exercising the option.

A company representative said there is no change to Codelco's stance on the option following official comments by the miner's executive president José Pablo Arellano last week that Minmetals had agreed to drop the option.

Codelco offered Minmetals the option on Gaby during its previous administration led by former executive president Juan Villarzú.

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Earlier this year, Codelco started talks with Minmetals to dissuade it from exercising the option following pressure from political and union circles on grounds it was no longer a good idea considering today's higher copper prices.

Commissioned in May, Gaby is slated to produce 80,000t of copper cathode this year, 150,000t in 2009 and 165,000t/y after an expansion. Codelco produced a total 675,000t of red metal in this year's first half.