LONDON, Dec 06, 2011 (Dow Jones) -- Xstrata Copper, the world's fourth-largest copper producer, expects to benefit from global copper supply constraints as it continues to deliver its projects on time and on budget and continues to expand its mineral resource base.

"It has been pretty challenging...on the supply side," said Charles Sartain, the chief executive of Xstrata Copper, a division of Anglo-Swiss miner Xstrata PLC(XTA.LN).

Copper producers have suffered production setbacks over the past few years and into 2011, due to declining ore grades as well as weather disruptions, labor issues and technical operational disruptions at several large mines around the world.

Freeport-McMoRan Copper & Gold Inc. (FCX) continues to deal with ongoing strikes at Indonesia's Grasberg mine while Chile's Collahuasi mine, which is controlled by Anglo American PLC (AAL.LN) and Xstrata, also faced a strike as recently as last week.

The global copper industry has seen "very anemic supply growth--almost zero growth--in 2011," Sartain said. He noted that Xstrata's strategy in the current market environment would be to expand its "market share as we move into a very strong position" with regard to copper production.

Xstrata plans to increase its copper production more than 50% to 1.5 million tons year by 2015. It is also evaluating an additional 2 million tons of annual copper production to add growth beyond 2015.

The company has been able to increase its production base by growing its mineral resources base. On Tuesday, Xstrata Copper announced that it had increased its total contained copper in total mineral resources by 10% to 97 billion tons in 2011.

A significant portion of its mineral resource base has come from its South American operations. Xstrata highlighted Argentina as one of the regions where the company has potential for significant production growth as it continues to develop its Agua Rica and El Pachon projects.

When asked if Xstrata has developed an edge over its competitors in terms of developing projects, Sartain said, "I think we do have an edge." He said the company has benefited from working in such countries as Argentina despite political difficulty. It has also accrued a large portfolio of assets that allows it to select the winners out of a group of projects.

Xstrata's Thras Moraitis, executive general manager of group strategy, said Xstrata has benefited from the fact that it invested in mining projects during the 2008-09 downturn when other companies suspended their investments, thereby allowing it to jump ahead of the queue in terms of securing equipment with long lead times.

On the demand side, Sartain said that China and developing countries continue to drive copper demand growth over the medium to long term. China and developing Asian countries are forecast to account for 62% of copper demand by 2020 and will account for 90% of demand growth between 2011 and 2020, according to Xstrata.

Moraitis said that Chinese copper demand is already starting to return as small to medium fabricators are able to once more secure credit to restock their depleted inventories. He said he expects demand to pick up even more following the end of the Chinese New Year in January.