Despite workers’ accounts of operational setbacks, Codelco Chairman Maximo Pacheco acknowledged the reported challenges and emphasized the organization’s commitment to learning from past mistakes.
PMCHS forms part of Codelco’s strategic structural projects aimed at prolonging the life of its key mines and compensating for declining ore grades. As global demand for copper surges, driven by the transition to cleaner energy sources, the necessity for efficient copper production becomes increasingly vital.
While the PMCHS overhaul was anticipated to enhance the mine’s longevity by 50 years, delays, collapses, and construction complexities have plagued the underground mine’s progress. The project’s production targets have fallen short, with actual output lagging behind projections.
The initiative to revamp PMCHS was inaugurated in 2019 with an expected production volume of 385,000 metric tons in 2023. However, actual production figures stood at 268,000 metric tons in 2022 and a mere 178,000 metric tons in the first nine months of 2023 due to project rollout delays.
An array of internal reports, financial statements, and regulatory documents reviewed by Reuters shed light on the root causes behind the project’s setbacks. Confidential sources within Codelco raised concerns over the lack of accountability for management teams and top executives amidst financial challenges, worker injuries, and fatal accidents.
Chile’s mining regulator, Sernageomin, disclosed that Codelco has faced sanctions and fatal accidents in recent years, predominantly linked to project construction rather than routine mining operations. The agency emphasized common factors related to control mechanism breaches contributing to safety lapses.
Pacheco attributed maintenance deficiencies at PMCHS partly to supply chain disruptions and staffing issues during the COVID-19 pandemic. He acknowledged a series of delays and equipment failures resulting from inadequate maintenance practices during the pandemic-induced operational challenges.
Looking ahead, Pacheco and other executives expressed optimism for a production rebound in 2024 as additional projects come online and Codelco’s Ministro Hales mine stabilizes operations following a significant landslide in 2022. In a bid to address operational issues, Codelco announced plans to bolster maintenance efforts and implement stringent monitoring mechanisms.
The complexities encountered at PMCHS underscore the intricate nature of executing multiple megaprojects simultaneously within the mining sector. Despite facing setbacks, Codelco remains committed to rectifying operational challenges and optimizing production efficiencies across its key mining ventures.