DJ China's Chinalco Warns Peru On Lack Of Port For Copper Mine

Minera Chinalco Peru SA, part of Aluminum Corp. of China (ACH), or Chinalco, on Tuesday warned the Peruvian government that its main port isn't adequate to move minerals for export from the Toromocho copper project.

The company expects Toromocho to start operations in 2012, with the minerals moving through the port of Callao, an antiquated port that critics say isn't ready to handle increased amounts of exports.

"We are going to need a port one way or another. There is no other possibility," Minera Chinalco Chief Executive Gerald Wolfe said in a broadcast interview.

He said that the government hasn't give the company any answers when asked when the port of Callao will be improved to standards to be able to handle the ore from the Toromocho project.

After constructing an open-pit mine and a concentrator, estimated average annual production at Toromocho is seen at one million metric tons a year of copper concentrates, with smaller amounts of molybdenum and silver.

"The port improvements (at Callao) are necessary with or without Toromocho. The current conditions aren't reasonable for mineral exports," Wolfe said.

He said that the company estimates that an investment of around $70 million would have to be made to improve the port, including reducing the environmental impact of moving the minerals.

Peru's Minister of Transportation and Communications Enrique Cornejo said Tuesday that there are currently four studies underway aimed at modernizing the port to be able to handle increased mineral exports.

In 2003, the government of Peru awarded the concession to Canada's Peru Copper Inc. for the Toromocho deposit located in the central Andes Mountains. That company later sold the project to Chinalco.

Peru is the world's largest producer of silver and a major producer of copper, gold, zinc, molybdenum, tin and other minerals.

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