Chile 2012 Copper Output Seen Gaining 10% On Year-Minister

SANTIAGO, Apr 16, 2012 (Dow Jones) -- Chile's copper production this year will likely be 10% higher than ned in 2011, Mining Minister Hernan de Solminihac said Monday.

Chile produces a third of the world's copper, but 2011 output retreated due to strikes, bad weather and falling ore grades, or the amount of copper in mined materials.

Last year, the official said, Chile produced 5.2 million metric tons of copper; for 2012, production is seen growing to 5.7 million tons.

"We expect output to grow with regards to last year, when there was a drop in production," De Solminihac told reporters on the sidelines of an exploration seminar hosted by the CESCO copper studies think-tank.

He added the government sees copper holding at around $3.80 a pound this year as demand will continue to outpace supply.

The Chilean government keeps close tabs on copper prices as the revenues from its own copper sales and private mining-companies' income and royalty taxes are a significant source of fiscal revenue.