Mining Energy price recorded its lowest level since 2008
The increase in coal-fired generation and the fall in the price of this fuel explain the low of this item for mining companies
One of the major concerns that mining companies have is the high energy prices that have been paid for the past three years.
However, this restlessness has slowly been dissipating for companies located in the Northern Interconnected System (SING), ranging from Antofagasta to Arica.
According to the latest report issued by the Association of Generators in December, the average market price for large companies of the SING-averaging all contracts between generators and free customers-reached $ 92.9 per MWh, recording its lowest level since January 2008.
Even in September this year the price of energy was able to fall below $ 100 per MWh, after nearly five years on that figure.
According to Maria Isabel Gonzalez, former executive secretary of the National Energy Commission (CNE), the decline in prices is directly related to the increase in coal-fired generation in the SING.
During December the plants based on this fuel surpassed 80% of the total energy produced in the great north.-
“What is happening in the SING is that both supply and demand are fully shod with efficient electricity generation. This does not happen in the rest of the country, where they are paying high prices and some of the requirements are being stocked with inefficient plants, such as diesel, “says Maria Isabel Gonzalez.
In addition, from industry they explain that the large availability of gas in the United States-after the discovery of huge reserves of shale gas – has caused a drop in coal prices.
The latter has resulted in the arrival of U.S. shipments of coal to Chile, which are being used by the plants in the north.
Also, from the Association of Generators ensure that this drop in energy values for large companies is a demonstration that this market is highly competitive, despite the fact that 80% of electricity is produced by three companies (E-CL, Gener and Gasatacama).
Mining Costs
Despite the drop in energy prices for companies in the north of the country, from the Mining Council say it is still difficult to envision a brighter outlook on costs.
Among the guild they added that companies are still working on several fronts to contain and reduce costs during 2014.
“In terms of labor productivity, all companies from the Mining Council have assumed that they must work together to deliver better information to the world of training, and to make available better tools for the development of their work, what they are doing to through the Council of Mining Skills. Also, are developing energy projects to introduce more competitiveness to the generation sector and thus contribute to the reduction of energy costs, which account for almost 20% of total production costs, “said CEO of the guild, Joaquín Villarino.
Source: El Mercurio
