(Adds details from regulator on mine plan)
By Eric Onstad and Rosalba O'Brien
LONDON/SANTIAGO Feb 21 Anglo American
said on Tuesday it will walk away from its El Soldado copper
mine in Chile if it cannot agree with local regulators on a
permit for a redesign of the operation.
The company's initial application for the redesign was
rejected due to the potential for a collapse where the project
crossed former underground operations, according to a regulatory
document seen by Reuters on Tuesday.
Anglo said last week it had temporarily suspended operations
at the mine, which produced around 36,000 tonnes of copper in
2015, after failing to get the regulatory approval. It did not
give reasons for the project's rejection.
The company is still hopeful it will secure approval in
three to four weeks, but if a satisfactory permit cannot be
agreed, "we won't continue going forward with the operation",
Chief Executive Mark Cutifani told a presentation following the
group's earnings announcement in London.
In a report dated Jan. 30 that set out why it was rejecting
the permit, Chilean mining regulator Sernageomin said the
project interacted with an underground mine that closed in 2010
"which generates high potential risks for uncontrolled
The company had not considered the structure or geology
sufficiently, it said. But it left a window open for Anglo to
redesign the project.
"The mining company can register a new project that gives
greater security to people and installations, according to the
terrain," it said.
Anglo has said it believes its plan was safe.
"El Soldado is geotechnically complex, but we are confident
that our plan for the mine is safe, a view that has been
validated by internal and external experts in this field," the
El Soldado is part of the Anglo American Sur complex, in
which Chile's state-run Codelco and Japan's Mitsui
and Mitsubishi also hold stakes.
The mine has lost money in recent years and management has
been following an aggressive savings plan against the backdrop
of falling copper prices.
(Reporting by Eric Onstad in London and Rosalba O'Brien in
Santiago; Editing by Jason Neely and Paul Simao)