https://www.miningweekly.com
Copper|Financial|Mining|Projects
Copper|Financial|Mining|Projects
copper|financial|mining|projects

Codelco to meet obligations as financials deteriorate -JPMorgan

27th September 2023

By: Reuters

  

Font size: - +

SANTIAGO – Chile's Codelco, the world's largest copper producer, will meet its financial obligations despite headwinds from a series of operational problems and from high levels of debt and investments, JPMorgan said on Tuesday.

Codelco's copper production fell in 2022 to its lowest level in 25 years, exacerbated in part by delays to key projects for extending the lives of its mines.

The company cut its production estimate for this year to between 1.31-billion and 1.35-billion metric tons of the red metal.

"We believe Codelco will be able to meet all of its financial obligations despite the elevated capex budget and operational issues it has faced that has led to reduced production and increased unit costs," JPMorgan analyst Ian Snyder said in a note.

JPMorgan estimates that Chile's government will likely provide support to Codelco, which gives all its profits to the state, through direct capital injections or by a continued reduction in upstream dividends so that the company can make investments, if necessary.

"That said, we do expect credit metrics to continue to deteriorate as the company will likely issue additional debt to help fund a portion of the capex budget," the note added.

In August, Chile's Center for Copper and Mining Studies (CESCO) said in a report that Codelco was at risk of insolvency due to rising costs and a growing debt pile stemming from projects that missed output targets.

Earlier this month, Codelco's Chairman Maximo Pacheco told lawmakers that the company was "financially solid" and described CESCO's forecast as "nonsense."

Edited by Reuters

Comments

Showroom

Booyco Electronics
Booyco Electronics

Booyco Electronics, South African pioneer of Proximity Detection Systems, offers safety solutions for underground and surface mining, quarrying,...

VISIT SHOWROOM 
Sandvik Mining and Rock Solutions
Sandvik Mining and Rock Solutions

Sandvik offers a wide range of loaders and trucks for underground hard rock mining, all engineered for safety, productivity and reliability in the...

VISIT SHOWROOM 

Latest Multimedia

sponsored by

Magazine cover image
Magazine round up | 08 December 2023
8th December 2023

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION







sq:0.156 0.194s - 113pq - 2rq
Subscribe Now