BHP Billiton announced go-aheads in mid-February 2012 for two projects at the Escondida copper mine in northern Chile that will require a combined total of $4.5 billion in capital spending and that will underpin higher production at the mine over the next decade.

Escondida, the world’s largest copper mine, is located in the Atacama desert, 170 km southeast of the city of Antofagasta, at an altitude of 3,100 m above sea level. It is owned by BHP Billiton (57.5%), Rio Tinto (30%), JECO Corp. (10%) and JECO 2 Ltd. (2.5%). BHP Billiton is the operator.

The larger of the two projects at Escondida, Organic Growth Project 1 (OGP1), will replace Escondida’s current Los Colorados concentrator with a new 152,000-mt/d plant and allow access to higher-grade ore located underneath the existing facilities. Construction began in February and commissioning is anticipated in the first half of 2015. The project will cost $3.8 billion ($2.2 billion BHP Billiton share) and is expected to create up to 7,000 jobs during the construction phase.

The smaller project, the Oxide Leach Area Project, will add a new dynamic leaching pad and mineral handling system that will include several overland conveyers. The new pad will maintain oxide leaching capacity at current levels following exhaustion of the existing heap leach in 2014. The project is expected to cost $721 million ($414 million BHP Billiton share), with commissioning anticipated in the middle of 2014.

BHP Billiton also announced a 17% increase in mineral resources and a 25% increase in ore reserves at Escondida following successful brownfield exploration and accelerated in-fill development drilling programs. The reserve increase also reflects the approval of OGP1, as most lower-grade sulphide ore is now expected to be treated through the flotation circuit, with an associated increase in process recoveries.

A new resource was also declared at Chimborazo 15 km northwest of the Escondida mine, based on more than 115,000 m of drilling averaging 530 m in depth. The resource is located within the property limits of Minera Escondida Ltda. and is being evaluated as potential feed for Escondida’s sulphide leach processing facilities.

Chimborazo is a porphyry copper-style deposit and a related hydrothermal breccias system that underlies an average thickness of 100 m of leached cap and gravel overburden. The mineral resource is largely contained in a secondary chalcocite enrichment zone and local enargite, forming a sub-horizontal mineralized body with horizontal dimensions of 500 by 1,000 m and thickness of 50 to 200 m.

BHP Billiton Base Metals President Peter Beaven said, “We expect the completion of the current Escondida Ore Access and Laguna Seca debottlenecking projects, and a strong recovery in ore grades, to support a substantial recovery in Escondida copper production to over 1.3 million mt/y in the 2015 financial year.

“Looking ahead, the success of our brownfield exploration program suggests there are sufficient resources at Escondida to sustain production at current levels for more than a century. OGP1 is the first of a series of potential projects that could substantially expand processing capacity at Escondida and help ensure that it remains the world’s leading copper operation for decades to come.”

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