Major mining reduce costs by more than $ 860 million
The increased use of production equipment, the renegotiation of contracts with third parties and internalization of certain functions as well as project leadership with internal teams, are some of the formulas used.
Good results are giving the plans to reduce costs and increase productivity applied by large mining in the country.
A group of them, representing 56% of the 2.8 million tons of fine copper produced in the country during the first half, have saved more than $ 860 million between 2013 and 2014.
The more structured plan and known to the public level is applying by Codelco through its Structural Project Productivity and Costs (PEPC), which already totals efficiencies of $ 663 million, of which $ 181 million were recorded during the first half of this year, according to state company in its delivery of results (see file).
According to Ivan Arriagada vice president for Administration and Finance of the corporation, the advance of this year came from renegotiating 80 contracts at June, a total of 200 annual plan.
In addition, a further $ 100 million is explained by saving supplies and materials, without impacting production. Besides, $ 100 billion less spending by better managing of the tires, a resource that is sensitive to mining operations.
Also, internally, consulting, advisory and support services were reduced, equivalent to a saving of $ 26 million.
These cuts helped lower the direct cost C1, which the second quarter was $ 1.56 per pound of copper, while in the same period in 2013 was US $ 1.72.
The other experiences
Codelco mining is not the only one who is having results. An important step was made by Minera Escondida, operated by BHP Billiton. As reported recently the CFO of the matrix, Graham Kerr, the internalization and optimization activities of some contractors, involved a savings of $ 190 million for this private job.
Such was the impact, which contributed to a 6% reduction in unit costs copper assets operated by the company, he added.
Another experience runs through the group Antofagasta Minerals, which are also developing a program to reduce costs for its operations and projects.-
According to the semi-annual results, in 2013 the mining arm of the Luksic group advanced in the review of its entire supply chain, working practices and contracts, a process that continued in 2014 and resulted in the implementation of some cost reduction initiatives, so that the company can capture that improvement.
An example is Minera Centinela, result of the operations union of Esperanza and El Tesoro. As explained by the company, in the conference held in London last week, this year will capture savings of about $15 million as a result of derived synergies from reduced executive staff and other pursuant actions. In 2015, it is expected to reach about $ 50 million.
In AMSA there is the vision according to the Conference- the supplier market will be less tight, so the price of these services for projects should be less pressured
Source: Diario Financiero
