Xstrata Says Chile's Collahuasi Prefeasibility Study Approved

LONDON, Jun 23, 2011 (Dow Jones Commodities News Select via Comtex) -- Anglo-Swiss diversified miner Xstrata PLC (XTA.LN) Thursday said the prefeasibility study for the expansion of Chile's third-largest copper mine, Collahuasi, has been approved.

Global diversified miners Xstrata and Anglo American PLC (AAL.LN) each own a 44% stake in the mine while a Japanese Consortium headed by Mitsui & Co. (8031.TO) holds the remaining 12%.

Main Facts:
- The Board of Directors of Compania Minera Dona Ines de Collahuasi SCM has given its approval for the company's technical teams to commence a prefeasibility study into Collahuasi Phase III.

- The project envisages the construction of one or two new grinding lines, allowing Collahuasi to process between 270,000 and 380,000 metric tons of ore a day.

- This increases production from the current annual average of approximately 500,000 tons of copper to 800,000 tons with a single line expansion, and to more than 1 million tons with both lines.

- The project is expected to be commissioned in 2017.

- The prefeasibility study is scheduled for completion in the first half of 2012.

- Collahuasi has recently announced approval to increase the processing capacity of its existing concentrator plant to 160,000 tons of ore a day by mid-2013.

- Xstrata's shares closed Wednesday up 0.4%, or 4.5 pence, at 1,89.50 pence a share.