Codelco
The Corporación Nacional del Cobre de Chile, better known as Codelco, is a Chilean state-owned company dedicated to copper mining, an area in which it is one of the largest companies of the planet. Codelco operates eight work centers, located between the Antofagasta region and the Libertador General Bernardo O'Higgins region. The Headquarters is located in Santiago.
Codelco is the world's largest copper producer and the company that contributes the most to the Chilean economy. During 2021, its production totaled 1,727,355 mtf of fine copper (including its interests in El Abra and Anglo American South), which corresponds to 8% of world production and 31% of national production. Currently, this company has a total of 15,267 employees.
Codelco concentrates 7% of global copper reserves, contained in world-class deposits and, with a 10% share, is the second largest producer of molybdenum.
The company has seven mining divisions: Radomiro Tomic, Chuquicamata, Gabriela Mistral, Ministro Hales, Salvador, Andina and El Teniente. Added to these operations is the Ventanas division, equipped with smelting and refining facilities.
In addition, the Corporation has a 49% interest in Sociedad Contractual Minera El Abra and, since 2012, owns 20% of Anglo American Sur. In addition, Codelco participates in various companies focused on exploration and technological research and development, both in Chile and abroad.
Key to the development of Chile, since the nationalization of copper in 1971, until 2019, Codelco's deposits and operations have contributed US$ 115 billion to fiscal coffers.
The history of Codelco goes back to the process of nationalization of the Greater copper mining that during a great part of the XX century It was carried out by US capital. In 1967, the State became the majority shareholder of the main copper mines in the country, until in 1971, during the government of Salvador Allende, the companies were totally expropriated and nationalized. Each one administered as a separate company in charge of the Copper Corporation, these would finally be unified into a single company, Codelco Chile, in charge of the exploitation of the deposits and the commercialization of their products, with the promulgation of Decree Law No. 1,350. on April 1, 1976.
Codelco is headed by a board of directors with nine members appointed in accordance with the regulations established in Law No. 20,392 promulgated on November 4, 2009. The board of directors is made up of four directors appointed from a five selected by the Board of the Senior Public Management; one director chosen from a panel submitted by the Federation of Copper Workers (FTC), and one director selected from a panel submitted jointly by the Federation of Copper Supervisors (FESUC) and the National Association of Copper Supervisors (ANSCO). The president of the board of directors is appointed by the president of the Republic, from among the directors.
The executive president is appointed by the company's Board of Directors and is in charge of the Corporation's administration, a position currently held by Octavio Araneda.
US$ 2,078 million of surpluses were generated by Codelco in 2020, 55% more than in 2019. A substantial part of the better figure is explained by the company's management. Little more than 46% is only good administration and the rest is price and exchange rate. The state mining company improved its production by 1.9%, lowered its direct costs by close to 9% and increased sales of copper and its by-products, to meet all the commitments acquired with the State
Operations
Codelco owns 7 mining divisions, in addition to the Ventanas division and the Headquarters in Santiago. They are detailed below in geographical order:
| Division | Location | Home | Description | Production(2021) | Photo |
|---|---|---|---|---|---|
| Chuquicamata | Calama, Antofagasta Region | 1915 | Open and underground mine Production of electro-refined and electro-obtained and copper concentrate tubes Self-doing: 3,935 people (2021) | 319.280 tmf |  |
| Radomiro Tomic | Calama, Antofagasta Region | 1997 | Open range Production of electro-obtained cathodes Self-doing: 1,251 people (2021) | 326.456 tmf |  |
| Minister Hales | Calama, Antofagasta Region | 2010 | Open and underground mine Production of copper, copper and silver limestone Self-doing: 771 persons (2021) | 181.704 tmf | |
| Gabriela Mistral | Sierra Gorda, Antofagasta Region | 2008 | Open range Production of electro-refined cathodes Self-doing: 457 people (2021) | 100.908 tmf | |
| Salvador | Diego de Almagro, Atacama Region | 1959 | Underground and open rail mine Production of electro-refined and electro-obtained cathodes Self-doing: 1,501 persons (2021) | 52.885 tmf | |
| Andean | The Andes, Valparaiso Region | 1970 | Underground and open rail mine Production of copper concentrate Self-doing: 1,424 persons (2021) | 177.216 tmf | .jpg) |
| Windows | Puchuncaví, Region of Valparaíso | 1964 | Funding and refinery Self-doing: 774 people (2021) | - |  |
| Matriz House | Santiago, Metropolitan Region | 1976 | Administrative functions | - | |
| Lieutenant | Rancagua, General Liberator Region Bernardo O'Higgins | 1905 | Underground and open rail mine Production of copper anodes Self-doing: 3,845 (2021) | 459.817 tmf |  |
Production
The following is the annual production of fine copper (in thousands of metric tons) and molybdenum (in metric tons) since the year Codelco was founded, according to statistical data from Cochilco:
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The following graph shows Codelco's copper production distributed by division:
The following graph shows Codelco's molybdenum production distributed by division:
Mining Associations
By Law No. 19,137, of May 12, 1992, CODELCO may associate with third parties to carry out its mining activities. The main association has been the SCM El Abra, for the copper deposit of the same name, located in Region II. Formed in 1994, CODELCO holds a 49% stake, while the remaining 51% is controlled by Cyprus El Abra Corporation, a subsidiary of Freeport-McMoRan Copper. In addition, CODELCO also participates in the contractual mining company Purén, where it owns 35% of the property (the rest belongs to Compañía Minera Mantos de Oro, controlled by Goldcorp Inc. and Kinross).
History of Codelco
The indigenous cultures that inhabited what is now Chile in pre-Columbian times used copper to make different tools. They developed elemental metallurgies that allowed them to exploit and work this metal, even to produce alloys. From then until today, copper has remained a fundamental product of the Chilean economy.
The exploitation of the red metal remained a small industry during the colony. In 1810, the year of Independence, Chile produced 19,000 tons of mineral. Between 1820 and 1900, the country produced 4 million tons of copper and was, for a time, the world's leading producer and exporter.
At the end of the 19th century, a period of decline began, due to the great impact of saltpeter, which monopolized interest and investment, and the depletion of high-grade deposits. In 1897 barely 21,000 tons of copper were produced.
At the beginning of the XX century, investments began in El Teniente and Chuquicamata by North American companies. Chile had in those years a reduced participation in the great copper mining.
In 1951 the Washington Agreement was signed, which allowed Chile to dispose of 20% of the copper production, enabling the Chilean Government to increase the income from the copper activity.
In 1955, the Senate enacted a series of laws whose objective was to guarantee a minimum income for the Chilean State and encourage investment by large mining companies.
On May 5 of the same year, the Copper Department was created, a state body whose tasks consisted of supervising and participating in the red metal market internationally.
Chileanization
In 1966, Law No. 16,425 was enacted, which authorized the creation of joint ventures between the State of Chile and foreign copper-producing companies. In said joint ventures, the Chilean State had to have at least 75% ownership of the deposits in the hands of foreign companies.
In 1967, the El Teniente, Chuquicamata and Salvador mines became mixed companies, for which the then National Copper Corporation acquired 51% ownership of them. The remaining 49% remained in the hands of the former owners: Braden Copper Company, a subsidiary of the Kennecott Corporation, in the case of El Teniente; and Anaconda Copper Company, in the case of Chuquicamata and Salvador.
Regarding Andina and Exótica, in 1967 they became 25% owned by the National Copper Corporation, leaving the rest in the hands of Cerro Corporation and Anaconda, respectively.
Nationalization
In 1971, through the modification of Article 10 of the Constitution, the possibility of nationalizing large-scale copper mining was introduced. The same constitutional reform added a transitory provision that established that: "for the national interest and in exercise of the sovereign and inalienable interest of the State to freely dispose of its wealth and natural resources, they are nationalized and therefore declared incorporated into the full and exclusive domain of the Nation foreign companies, which constitute the great copper mining”.
Through this constitutional modification, all the assets of the aforementioned companies became national domain and five State collective societies were created to manage said wealth.
In 1976 it was decided to dissolve these collective societies. For this reason, the existing companies were grouped into a single company, mining, industrial and commercial, with legal personality and its own assets, of indefinite duration, which is related to the Government through the Ministry of Mining. Through Decree Law No. 1,350 published on February 28, 1976, the National Copper Corporation of Chile was created, which can be called CODELCO or for short. b>CODELCO-CHILE, which assumed the administration of the nationalized deposits.
In 1997, Radomiro Tomić was inaugurated, the first deposit put into operation entirely by Codelco. In 2002, the then Radomiro Tomić and Chuquicamata divisions were integrated to form the Codelco Norte Division. In 2003, the Corporation achieved the highest production in its history, with 1.84 million metric tons of fine copper. In May 2008, the Gaby Project was successfully completed, becoming the second mining operation developed by Codelco from its engineering and construction to its commissioning and production.
Investments 2015*
- Development Projects: USD 899 million
- Equipment replacement and installation refurbishment: USD 102 million
- Environment, occupational safety and well-being: USD 114 million
- Pre-investment research and studies: USD 180 million
- Geological explorations: USD 45 million
- Mine development and deferred expenses: USD 389 million
- Other*: USD 233 million
- Total: USD 1.962 million
* In nominal currency.
** Includes contributions to businesses or participations.
Research and technological innovation
Research, technology development and its incorporation into industrial processes are part of Codelco's strategy to increase productivity, reduce accident risks, benefit the health of its workers and contribute to the protection of the environment.
During 2008, Codelco invested USD 52.4 million in this area: USD 25 million in studies and corporate technological research and innovation programs; USD 7.5 million as contributions to technology companies; 3.1 million as a contribution to other companies and institutions, and USD 16.8 million for technological development through Codelco subsidiaries.
On the other hand, from the point of view of knowledge management, progress was made in the corporate guidelines for the protection of intellectual property, which seek to safeguard the knowledge developed by Codelco in technological innovations. In this sense, a registry of all patent applications submitted to the Department of Industrial Property of the Ministry of Economy from 1991 to 2007 was carried out; as well as the patents granted, rejected or abandoned in the period.
CodelcoTech
In June 2016, the Chairman of the Board, Óscar Landerretche, announced the creation of "Codelco Tecnologías" (CodelcoTech), as a new subsidiary, with the mission of consolidating the efforts made by its subsidiaries that make technological innovation under a single umbrella, under an "open innovation" model, a model that other large mining companies such as BHP Billiton and Anglo American have already experimented with promising results. Its implementation has been the result of the merger of the large subsidiaries with a technological focus of the Corporation, such as IM2 and Biosigma.
Corporate technology programs
These projects seek solutions for Codelco's specific challenges when there are no alternatives on the market. Some of them are:
Underground mining
Seeks to increase the productivity of underground mining with the identification, investigation of mining processes and equipment, prototyping and industrial validation of continuous mining technologies.
Considers the development of a conditioning process for the rock mass and extraction with continuous material handling. These investigations and their industrial validation are carried out in the mines of the Salvador, Andina and El Teniente divisions, with the participation of various research centers, the industry of mining suppliers and services, and Codelco professionals.
Open Pit Mining
The goal of the program is to achieve fully automated, low-cost, high-performance, and environmentally friendly continuous mining by 2012. In the medium term, it seeks to develop theoretical blasting models; slope engineering; new ways to boot; and development and industrial evaluation of autonomous transport initiatives, of great capacity and high energy efficiency.
Bioleaching of sulfide minerals
The application of bioleaching technologies, developed by BioSigma, has been validated in Codelco's low-grade sulphide resources.
In situ leaching
Its objective is to define and standardize the characterization of resources for the application of in situ leaching.
Robotization
2008 marked the beginning of the mining operations robotization program. Together with the company MIRS (linked to Codelco), they worked on the conceptualization of seven robotic solutions for the mining industry.
Partnerships to accelerate mining innovation
Codelco has developed a partnership scheme, through alliances with companies and research and development organizations, leaders in the world. In several cases, these alliances have evolved into partnerships, managing to speed up the integration of innovations into mining processes.
Support for national scientific research
Since 1994, Codelco has acted as an industrial counterpart in 42 Fondef projects in a permanent plan to support scientific research that makes it possible to generate new advances for the mining industry.
Contribution to technology companies
BioSigma
Codelco and the Japanese company JX Nippon Mining & Metals Co. Ltd. created BioSigma S.A. in 2002. BioSigma is a company that develops, implements and adapts comprehensive biotechnological solutions for the mining industry through sustainable processes. To date, BioSigma has a leaching biomass production plant located in the Radomiro Tomic Division of CODELCO, and the bioleaching technologies developed by BioSigma are being applied on an industrial scale for the recovery of copper from low-grade primary sulphide ores. BioSigma currently has more than 90 invention patents granted in 14 countries and continues to incorporate biotechnology advances into mining to increase the economic benefits available from the vast resources of low-grade and other secondary materials. As of December 2016, Biosigma merges with the other Codelco technology subsidiaries, to give way to the creation of CodelcoTec.
Institute for Innovation in Mining and Metallurgy (IM2 S.A.)
Codelco created IM2 in 1998, as a knowledge generation subsidiary dedicated to the development of technology-based innovation in mining and metallurgy. His management focused on technological programs for underground mining, mineral processing, open pit mining, and high-temperature processes. As of December 2016, IM2 merges with the other Codelco technology subsidiaries, to give way to the creation of CodelcoTec.
EcoMetals
This subsidiary aims to treat products with high impurities. EcoMorales Limited is a subsidiary of Codelco Technologies Ltd (Bermuda), which offers environmental solutions to mining and metal recovery processes. The company was founded in 2001 to contribute to solving the problems generated by the disposal of mining waste, taking advantage of recovering the valuable components present in said residues. EcoMetales develops industrial processes based on applied research and generates innovative and environmentally sustainable solutions. Its facilities are located 35 kilometers northeast of Calama, in southern Chile, where it operates a plant with high occupational health and safety standards. It has an experienced team of engineering, processes and projects. Its strategic location, added to its infrastructure and industrial experience in handling large volumes of waste, allow it to offer adaptability to the requirements of its clients, guaranteeing compliance with all standards. environmental and safety and a very competitive cost-quality ratio. EcoMetales currently processes waste from the Chuquicamata, Ventanas and El Salvador Divisions. In addition to Codelco, he actively seeks opportunities to collaborate with other mining companies.
Mike
Codelco and the Japanese Nippon Telegraph and Telephone Co. Ltd. (NTT) created Micomo (Mining, Information, Communication and Monitoring S.A.) in 2006. Its objective is to design, supply, install and maintain communication and information technology products, for which it takes advantage of NTT developments applied in other industrial fields. Since its operation, Micomo has implemented technological services that generate greater efficiency and security for Codelco.
Kairos Mining
Codelco and Honeywell (a leading company in automation and process control systems) joined forces to incorporate state-of-the-art automation to the concentrator plants. In this way, they can increase productivity and sustain Codelco's business in the long term.
Mining Industry Robotic Solutions (MIRS)
MIRS is a closed joint stock company, formed by Industrial Support Company Ltda. (HighService), Codelco, Nippon Mining & Metals Co Ltd. and KUKA Roboter GmbH. The scope of action of this company ranges from research, design, creation, manufacturing and installation, to the supply, maintenance and marketing of robotic solutions for mining. Since its creation, with the support of Innova-Chile, MIRS has focused on the Chilean and Peruvian markets, carrying out an intense commercial campaign. As a result, exploratory studies to identify opportunities were obtained and two robotic solutions were commercialized.
Codelco technology transfer
In the framework of the transfer and commercialization of technologies, Codelco carried out the conceptual engineering to incorporate the Teniente technology for the smelting of concentrates and cleaning of slag in the smelter of Mednogorsk, Russia. Another project was the training of personnel from the Ust-Kamenogorsk smelter in Kazakhstan, in the slag cleaning operation in an electric furnace, carried out in the Ventanas Division.
In addition, Codelco established in China, during 2008, six collaboration agreements with non-ferrous mining companies, engineering companies and research institutes to jointly explore or validate technologies and business opportunities.