SANTIAGO, Jun 10, 2010 (Dow Jones Commodities News via Comtex) -- Diversified global mining company Xstrata PLC's (XTA.LN) copper division plans to invest $1.5 billion through 2012 on its operations in Chile, Valor Futuro newswire reported Thursday, citing company executives.
In Chile, Xstrata Copper owns a 44% stake in the Collahuasi copper mine, one of the country's largest, and also owns the Lomas Bayas copper mine, the El Pachon project and energy subsidiary Energia Austral.
"Every year we invest millions of dollars and we have plans with Collahuasi management to invest even more and further investigate expansions there," Valor Futuro quoted Xstrata Copper Chief Executive Charlie Sartain as saying.
The company is looking at a $300 million capital expenditure to extend production at Lomas Bayas for another 10 years, Sartain said, according to the newswire.
Regarding the government's proposal to modify copper mining royalties in 2010 and 2011 to help finance earthquake reconstruction efforts, Sartain said the expected increase won't put a damper on the company's plans in Chile.
"We understand perfectly the difficulties that have arisen following the quake...we accept that the government wants to change its policies in the short-term," the newswire quoted Sartain as saying.
The fifth-strongest quake on record hit Chile in late February, killing 521 people, leaving a million injured or homeless and causing damages estimated at $30 billion.
To finance its share of the post-quake reconstruction, the government aims to temporarily increase some corporate and property taxes, permanently hike taxes on tobacco and modify the royalty large-scale copper miners currently pay.
The reconstruction financing bill is currently in Congress and could be voted on next week.