Xstrata Sees Strong Copper Fundamentals Despite Global Concerns

AREQUIPA, Peru, Sep 14, 2011 (Dow Jones) -- Xstrata Copper, a unit of Anglo-Swiss miner Xstrata PLC (XTA.LN), said Wednesday that it continues to see strong fundamentals in the copper market, even as it noted concerns about the global economy.

"We believe that there are still important fundamentals for copper supply and demand," Xstrata Copper's vice president, Jose Marun, told reporters on the sidelines of the Perumin mining conference.

"Nevertheless, we are in front of a potential crisis. There are problems in Europe and the United States and that will surely impact the market as well," he added.

Earlier this week, officials from Chilean state copper company Corporacion Nacional del Cobre, or Codelco, were reported saying that some clients had asked to cancel orders on concerns about the health of the global economy.

Codelco is the world's top copper-mining company and produces about 1.7 million metric tons of copper, which accounts for about 11% of global copper output.

Marun said that Xstrata has not faced similar requests from clients.

In Peru, Xstrata has the Tintaya mine in southern Cuzco region. Marun said Tintaya is forecast to produce 97,000 metric tons of copper in 2011.

The company also is developing the $1.47 billion Antapaccay project, also in Cuzco, and the $4.2 billion Las Bambas project located in Apurimac region.

Antapaccay is scheduled to start production in the middle of 2012, while Las Bambas is expected to start in 2014.