The Sierra Gorda copper-molybdenum-gold-silver operation in Chile has approved a fourth grinding line that will expand processing capacity from approximately 48 million tonnes to 60 million tonnes a year. The brownfield project carries estimated growth capital expenditure of US$725 million across the 2027–2030 financial years. The expansion will add grinding, crushing and flotation equipment together with related process infrastructure.
Expansion targets higher annual metal production
KGHM Polska Miedź holds a 55% interest in Sierra Gorda, while South32 owns 45%. The joint venture expects to finance the development through operating cash flow and joint-venture debt rather than direct equity contributions from the shareholders. The new line is scheduled to begin production in the middle of South32’s 2030 financial year, with full production rates targeted during 2031. At full operation, Sierra Gorda expects average annual payable production of approximately 195,000 tonnes of copper, 6,000 tonnes of molybdenum, 58,000 ounces of gold and 1.7 million ounces of silver.
Higher throughput to increase copper-equivalent output
The expanded operation is expected to produce approximately 250,000 tonnes of copper equivalent annually, representing an increase of about 30% from current levels. Higher mill throughput is also projected to lower average operating unit costs by approximately 10%. The feasibility study estimates an internal rate of return of about 20% at a long-term copper price of US$5 per pound, increasing to approximately 23% at US$6 per pound.
Existing infrastructure supports brownfield development
The project will use existing power, water, tailings and mine infrastructure, resulting in disclosed capital intensity of approximately US$21,000 per annual tonne of copper-equivalent capacity. The expansion will require integration of the additional processing equipment with the existing operation, including coordination of shutdowns and flotation performance as throughput increases. Ore characteristics and their effect on recoveries will also form part of the expanded operation’s production requirements.
