Peru Antamina Gets Go Ahead for $1.2 bln Expansion

LIMA, Jan. 6 -- Antamina, a leading copper-zinc mine in Peru, said on Tuesday shareholders have formally approved its $1.2 billion expansion.

Antamina -- a joint venture between BHP Billiton Ltd (BHP.AX: Quote) (BLT.L: Quote), Xstrata (XTA.L: Quote), Teck Cominco Ltd (TCKb.TO: Quote) and Mitsubishi Corp (8058.T: Quote) -- said the expansion would lift the volume of ore moving through its mills by 38 percent.

It produced 358,179 tonnes of copper and 382,842 tonnes of zinc in 2008, according to Peru's mining ministry.

Construction is expected to start in the first half of 2010 and be operational in the second part of 2011. It is expected to extend the life of the mine to at least 2029.

Miners in Peru delayed investments in late 2008 during the depths of the global economic crisis, but lately have decided to move ahead with expansion efforts.

Antamina's new investment was delayed for some months as the mine, the regional government of Ancash, and Peru's government worked out a deal to co-finance infrastructure projects around the mine and reduce payments on a mining tax.

In September, Antamina's President Ian Kilgour said the mine had already ordered new mills for the project.