Collahuasi’s executive team comes together to discuss the company’s extensive contribution to Chilean mining and mineral production – particularly as resources such as copper become increasingly critical within the global energy transition – while emphasizing its role in supporting local communities and economies.
THE HOUSE OF THE MINER
Chile, the distinctive ribbon of land that runs along the west coast of South America, is a curiously shaped country abundant with vast natural landscapes – from the rolling sands of the Atacama Desert, the driest non-polar desert in the world, to the peaks of the Torres del Paine National Park.
The vibrant capital of Santiago, meanwhile, is a bustling urban metropolis that perfectly juxtaposes against this tranquility.
Among its beautiful landscapes, Chile is also the world’s largest producer of copper, responsible for around a quarter of global production.
Bordering Peru and Bolivia, the Tarapacá region in the north of the country demonstrates Chile’s long-standing tradition as an epicenter for mining and mineral production.
In fact, many abandoned mining towns can still be found in the area, offering an insight into the region’s historical economic significance and the ways in which vital mineral resources were fought over in the War of the Pacific.
Today, Tarapacá remains home to numerous significant mining operations and some of the world’s most desired resources, including copper and naturally occurring sources of sodium and potassium nitrate.
Chilean mining company, Collahuasi, meaning ‘the house of the miner’ in the local Aymara language, boasts an extensive operation located in Tarapacá.
As one of the world’s primary copper producers and the second largest in Chile, Collahuasi is renowned for the extraction and production of copper and molybdenum concentrate.
Diligently mining its two major deposits, Rosario and Ujina, the company contributes significantly to the country’s gross domestic product (GDP) each year.
A BRIEF HISTORY
Collahuasi’s origins date back to the second half of the 19th century, when commercial exploitation of high-grade copper-silver veins began in Tarapacá.
However, mining activities in the area were interrupted in 1930 with the arrival of the Great Depression, only recommencing in Collahuasi’s current area of operation in 1978 after key features of the Rosario deposit’s exceptional copper grades were identified.
13 years later, the adjacent Ujina deposit was discovered, with the feasibility and environmental impact studies for its exploitation approved in 1995 and commercial operation commencing in 1999.
“In 2003, we more than doubled our sulfide ore treatment capacity, increasing our output from the initial project’s 60 thousand tons per day (ktpd) to around 130ktpd,” introduces Jorge Gómez, CEO.
Since then, various process optimizations have delivered an increase in capacity, equating to around 155ktpd in 2023.
Two years prior, the company also obtained the environmental permits required to extend the operation for 20 years and increase its ore treatment capacity up to 210ktpd.
Today, Collahuasi has an installed capacity of 170ktpd, with other debottlenecking projects in the process of implementation or under review to increase this capacity further in the coming years.
In terms of production and distribution, a 203-kilometer (km)-long system of slurry pipelines transports copper concentrate from the company’s concentration plant in Ujina to the Collahuasi Maritime Terminal in Punta Patache, 65km south of the city of Iquique.
From this facility, where the company’s molybdenum and concentrate filtering plants are also located, products are shipped to international markets – primarily China and other parts of Asia.
2023 saw Collahuasi record C1 costs of $1.27 per pound of copper, positioning the company in the first quartile of the industry.
Its direct and indirect economic contribution to the Chilean economy during the same year was equivalent to 1.34 percent of national GDP and 56.31 percent of GDP in the Tarapacá region. In addition, Collahuasi generated a significant contribution to the country through tax payments of $809 million.
“Collahuasi’s founding principles are focused on the responsible and efficient development of resources – first and foremost, the safety of our workers, respect for the environment, and the support of our local communities,” Gómez prides.
AN EVOLVING INDUSTRY
An industry stalwart, Collahuasi has noted major transformation in South America’s copper mining industry since its inception.
“Not only has the scale of the industry grown in line with global demand, but we have also seen dramatic changes in the landscape in terms of innovation and automation, while the sector has embraced and made significant progress toward sustainability alongside inclusion and diversity goals,” Gómez surmises.
Globally, demand for copper has grown due to the emergence of the resource as a critical mineral within the green energy transition – a trend that will continue to have a great impact on the future of the planet.
South America, and Chile in particular, therefore remain key for the global supply of copper.
However, the sector also faces challenges such as access to water and increasing regulatory pressures, while fluctuating commodity prices are expected to remain a feature of a rapidly changing world.
“Collahuasi’s founding principles are focused on the responsible and efficient development of resources – first and foremost, the safety of our workers, respect for the environment, and the support of our local communities”
Jorge Gómez, CEO, Collahuasi
“While accessing and developing the human capital needed for the future is a challenge, it is also an opportunity to accelerate the transformation of our workforce to be more inclusive and diverse,” he notes.
Mining, particularly copper mining, is a key pillar of development for Chile and plays a key role in attracting investment, driving economic growth, and contributing significant fiscal resources to the nation.
Chile and Peru dominate copper production in South America, accounting for more than 35 percent of global production combined, while other countries in the region such as Argentina, Brazil, and Ecuador play a smaller but steadily increasing role.
South America as a whole, meanwhile, has a significant 40 to 45 percent share of world copper production as it is home to some of the world’s largest and highest-yielding copper mines.
CONTRIBUTING TO LOCAL DEVELOPMENT
In 2023, Chile’s mining sector accounted for 11.9 percent of the country’s GDP, while its exports accounted for 56 percent, with a total value of $53 billion.
In the same year, Collahuasi was the third-largest copper producer in the world, responsible for the direct employment of around 2,000 workers and 3,000 contractors, with a strong focus on the development of local suppliers.
“We are committed to regional growth and being a positive contributor to neighboring local communities,” informs Trevor Dyer, CFO.
“Our focus is on generating shared value, ensuring that Collahuasi’s economic progress also translates into tangible benefits for our local communities.”
Indeed, Collahuasi has implemented various initiatives through the Collahuasi Foundation which is focused on entrepreneurship, socioeconomic development, capacity building, and education. Through the Collahuasi Foundation, high-quality educational establishments are co-managed and teach technical careers related to mining.
The foundation is critical in this regard, as the company actively invests in the education and co-management of two municipal technical high schools, raising the overall quality of education in the Tarapacá region.
Currently, more than 300 graduates from these schools work at Collahuasi or its contractor companies.
The contribution of mining in terms of direct employment in Chile last year reached 278,000 workers, a figure that rises to 986,000 if indirect employment is included – equivalent to 10.9 percent of national employment.
Policies implemented in Chile also ensure that mining royalties paid by companies in the sector are distributed to regional governments and municipalities throughout the country to fund community-centered initiatives.
“For example, some of these resources are allocated to national funds. These include the Territorial Equity Fund, which seeks to reduce the gaps that exist between municipalities’ incomes, the Mining Communities Fund, which focuses on the impacts of mining activity, and a fund for citizen security,” Dyer explains.
A STAND-OUT OPERATION
Differentiated by its management model, Collahuasi applies a risk management cycle framework throughout the entire value chain.
This has been the foundation for the company’s ongoing history of operational excellence, ensuring that learnings and opportunities are captured in a way that generate value for the business and the environment.
“Today, we stand out as one of the safest, most efficient, productive, and sustainable mining operations worldwide,” Gómez shares.
This is despite the fact Collahuasi’s main mine is located in the highlands of the Atacama Desert at an altitude of over 4,400 meters above sea level, close to the border between Chile and Bolivia, which has historically presented unique challenges in terms of operations and logistics.
As a result, the mine faces climatic conditions that vary widely from other mining operations in the country.
“For this reason, we have implemented advanced technologies to both protect the health and safety of our employees while ensuring operational continuity and productivity,” he outlines.
Collahuasi is one of the world’s true Tier 1 copper resources, both in terms of its absolute size but also because of its exceptional quality.
The asset’s copper reserves alone stand at over four billion tons with an average grade of 0.8 percent – a key factor that will help to maintain the exceptionally strong competitive position of Collahuasi in the long term.
“To realize the full potential of our asset, there are a number of projects that are either in the execution or development stages,” Gómez asserts.
A PLETHORA OF PROJECTS
One key focus is the growth project at the Ujina plant, which incorporates a number of initiatives required to increase the treatment capacity of the concentrator to the environmentally approved maximum capacity of 210ktpd.
“The various elements of this project will allow us to reach a production of over 600kt of copper per year, positioning Collahuasi as one of the leading copper producers in the world,” he adds.
At the same time, the company is also executing the construction of the C20+ project, which will provide the operation with a desalinated water supply.
The project, which will have an initial capacity of 1,050 liters per second, includes the construction of the desalination plant and water impulsion system, which will see water transported 194km from sea to mine.
This will ensure the supply of desalinated water for current operations and future growth projects, reducing pressure on local water resources, thus achieving a very significant milestone in line with enhancing the sustainability of Collahuasi’s processes.
“This is a crucial step to ensure operational continuity in an environment where water is a limited resource,” Gómez outlines.
While the project is still in its construction phase, it is expected to be fully operational during the first half of 2026.
Collahuasi is also moving forward at pace with studies to prepare for the future growth of the company, with the intention of significantly increasing its ore processing capacity.
Finally, the company is investing in the modernization of its mining facilities and processes by incorporating automation technology in mineral transport and processing, which will allow it to operate more efficiently and with lower emissions.
These include the operation of autonomous trucks, the use of a trolley system for its trucks in dumps, and the robotization of maintenance activities at the Ujina plant.
“All our projects are key to achieving Collahuasi’s objective to realize the full potential of our asset in the context of a growing global demand for copper.
“Further, these projects will enable the delivery of a more resilient, competitive, and sustainable operation, which will benefit all our stakeholders,” he asserts.
SUSTAINING PEOPLE AND PLANET
The Chilean mining industry has adopted more sustainable practices, such as the use of renewable energy sources and desalinated water and the optimization of processes through digitalization and automation, promoting the longevity of the country’s copper mining industry and long-term employment.
Collahuasi is a pioneer of sustainability in the country due to its use of renewable energy, with 100 percent of the company’s energy coming from clean sources such as solar and wind power.
Sustainability is therefore a core guiding framework for Collahuasi and applies to all levels of the organization, spanning people, projects, operations, facilities, and products.
“For this reason, we have a sustainability policy applicable to all our activities, which seeks to harmonize four key dimensions – business, environment, communities, and people,” clarifies Mario Quiñones, Vice President of Development and Sustainability.
Since 2021, the company has been implementing an environmental, social, and governance (ESG) management strategy, which includes specific medium and long-term commitments.
This entire policy is framed within the ambition to deliver sustainable development – harmonizing the company’s economic growth with the construction of a transparent and ethical relationship with stakeholders, alongside the consideration of the ESG needs and expectations of communities.
“Sustainability considerations are an integral part of our business planning and decision-making processes.
“They contribute to responsible resource management and allow us to better manage risks while achieving improved outcomes for all,” Quiñones explains.
Alongside the environment, Collahuasi recognizes the importance of sustaining people as its most valuable asset. Therefore, it promotes a company-wide culture of safety, inclusion, and personal development.
“Our continuous training programs ensure that employees and contractor partners can improve their skills and grow within the organization,” Gómez tells us.
The company also fosters an inclusive environment where diversity is seen as a strength and recognizes talent through incentive and recognition programs that value both individual and team contributions.
“The goal is not only to offer employment but create opportunities for professional growth,” he adds.
“We have a sustainability policy applicable to all our activities, which seeks to harmonize four key dimensions – business, environment, communities, and people”
Mario Quiñones, Vice President of Development and Sustainability, Collahuasi
DEVELOPMENT PROGRAMS
In line with the aforementioned, Collahuasi has developed a range of employee development programs.
Among them, the Professionals in Training initiative seeks to strengthen and diversify its portfolio of emerging professionals, encouraging their participation in and contribution to various strategic and functional areas of the company.
Alongside its employee development programs, Collahuasi’s local supplier development programs encourage the hiring of regional companies, generating employment and economic growth in the Tarapacá region.
During 2023, 47 percent of supplier spending was made with local or mixed companies, reaching $1.398 million across 853 companies.
“We seek to be much more than just a copper mining company – our purpose is to contribute to a better society,” asserts Dyer.
Collahuasi’s local supplier development programs are part a series of initiatives and measures that go beyond the business.
“We also maintain commitments with different indigenous and local organizations which, among other things, consist of carrying out participatory environmental monitoring that considers flora, fauna, and water resources,” adds Quiñones.
By joining community organizations in this work, the company ensures complete traceability regarding its work methodologies, measurements, and reporting.
“In this way, we have made progress in achieving greater transparency and strengthening trust in our management,” he points out.
LOOKING AHEAD
Going forward, in the short term, Collahuasi’s priorities include expanding production capacity in a sustainable manner, implementing new technologies to optimize operations, and completing the construction of the C20+ project.
“We are also advancing our strategy of reducing carbon emissions and the digitalization of our processes,” Quiñones divulges.
In addition, the company is deepening its commitment to local communities by expanding regional development programs.
Collahuasi is also working to deliver its medium and long-term growth agenda through the implementation of various ongoing projects.
“Given the aforementioned potential of Collahuasi´s resources, this includes the advancement of studies, which will allow us to continue on the pathway of growth for our company,” he adds.
As Collahuasi’s purpose and values state, it seeks to challenge the present to contribute to a better society for the future.
“Through this goal, we seek to create a positive legacy for our employees and local communities, as well as for the country,” prides Gómez.
Equally, it seeks to be a facilitator of development – socially, economically, and environmentally.
COLLAHUASI PARTNERS
