The small Zalvídar copper mine will be powered by a mix of hydro, solar and wind power over a ten-year period starting in 2020.
The Zalvídar mine is set to become the first mine in Chile to be powered by 100-percent renewable energy.
In a release last week, the operator of the mine, Antofagasta (LSE:ANTO) said that the Zalvídar Mine would by 2020 be “supplied with clean energy, removing emissions equivalent to 350,000 tonnes of greenhouse gases per year.”
As a result of the agreement signed in the city of Antofagasta with local energy supplier Colbún, the mine will be powered by a mix of hydro, solar and wind power generation.
“This agreement continues our move to become a more sustainable mining operation, with clean energy reducing the emissions of gases that cause climate change,” CEO of Antofagasta Iván Arriagada said.
“In addition, as a result of a competitive tender process, we have managed to reduce Zaldívar’s future energy costs.”
The Zalvídar mine was reported by Antofagasta to have produced 103,000 tonnes of copper cathodes in 2017.
The agreement will come into effect in July 2020 and will last for ten years.
According to Antofagasta, the 350,000 tonnes of greenhouse gas emissions avoided annually is the equivalent of taking 87,000 cars off the road.
Colbún, the energy provider, is described as having 3,893 megawatts (MW) of installed capacity in Chile and Peru, and a diversified portfolio of renewable energy projects.
As part of the contract, Colbún will be required to certify that the energy used by Zaldívar comes from renewable sources that do not generate emissions, and this must be verified by an external body.
“The signing of this contract crystallises Colbún’s vision of contributing safe, competitive and sustainable energy to the productive development of the country, and allows us to advance the development of a value offer for our clients that is consistent with our strategy of increasing our renewable energy portfolio,” CEO of Colbún Thomas Keller said.
Zaldívar is a 50-50 joint venture between Antofagasta and Barrick Gold (NYSE:ABX), with Antofagasta acting as operator.
The mine is one of four copper mines operated by Antofagasta across Chile. Zaldívar is the smallest of its operating mines, with its largest — the Los Pelambres mine— producing 343,800 tonnes of copper in 2017.
On Thursday (July 12), shares of Antofagasta closed up 0.64 percent on the London Stock Exchange at GBX 945.05.
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Securities Disclosure: I, Scott Tibballs, hold no direct investment interest in any company mentioned in this article.