Chile Faces Risk That Quake May Hit Copper-Rich North (Update2)

March 9 (Bloomberg) -- Chile, struck last month by an 8.8- magnitude earthquake that killed hundreds and damaged the country's main road, may be hit by another "large" temblor in the copper-rich North, a national earthquake specialist said.

An earthquake as strong as magnitude 8.5 may strike along a 670-kilometer (416-mile) stretch of northern Chile that runs from Mejillones to Arica, said Jaime Campos, director of the International Center to Investigate Earthquakes Montessus de Ballore. The forecast, which doesn't include a specific timeframe, is based on the Santiago-based group's studies of seismic measurements and previous quakes in the area.

"The most likely thing is for there to be a big earthquake there," Campos said yesterday in a telephone interview from Santiago. "There is enough energy to produce an 8.5, very similar to what happened in central Chile."

The Feb. 27 quake off the coast of southern Chile destroyed homes and triggered a tsunami that washed some homes out to sea. Copper mines owned by state-run Codelco, Anglo American Plc and Antofagasta Plc temporarily halted output because of power cuts, fueling a 4.1 percent gain in copper futures last week in New York. Chile is the world's biggest supplier of copper.

Campos said prior studies at the University of Chile, where the group is based, showed the area of southern Chile was vulnerable to a large temblor. Most of the nation's copper production is in northern Chile, where mines weren't damaged.

Drills

The quake has prompted the Dona Ines de Collahuasi copper mine in northern Chile to plan earthquake drills to train employees, Bernardita Fernandez, a spokeswoman for Collahuasi, said yesterday in an e-mail. The mine also is updating emergency systems, she said.

A magnitude 7.7 quake that rocked northern Chile in 2007 knocked out power to mines including Collahuasi, controlled by Xstrata Plc and Anglo American. The North division at Codelco, the largest copper producer, and BHP Billiton Ltd.'s Escondida copper mine, the world's biggest, also were temporarily halted.

Copper futures for May delivery were little changed to close at $3.410 a pound on the New York Mercantile Exchange's Comex division.

Chile is prone to quakes because its coastline, which stretches about half the length of the South American continent, lies near the boundaries of two tectonic plates that make up the earth's crust.

The movement of one plate sliding under the other caused the world's largest-ever measured quake in 1960, which had a magnitude of 9.5. That event led to a tsunami that swamped the southern Chilean city of Valdivia and reached Hawaii and Japan, according to the U.S. Geological Survey.