Lundin Cuts Copper Target After Another Storm Hits Chile

Lundin Mining (TSX:LUN,OTCPL:LUNMF) lowered its full-year copper production guidance after a second winter storm in Chile's Atacama region damaged infrastructure and disrupted operations at the Caserones mine.

Severe weather re-damaged a transmission tower serving Caserones that repair crews had recently fixed following a late July storm. The facility lost power again on August 14, forcing the site onto backup generators while crews work to restore full grid power by the end of the week ahead of a gradual ramp-up.

"Following the first storm, we expected the impact on production to remain within the lower end of our original guidance range,” President and CEO Jack Lundin said in an update. “Unfortunately, a second severe storm disrupted recovery efforts and delayed our planned return to full operations, leading to additional unplanned downtime. As a result, we have revised our guidance to reflect the extended recovery period."

The extended outage forced the Vancouver-based miner to reduce its 2026 copper production forecast for Caserones to between 120,000 and 130,000 tons, down from the previous range of 130,000 to 140,000 tons.

Cash cost guidance for the mine rose to between US$2.15 and US$2.35 per pound of copper, up from US$2.05 to US$2.25 per pound.

Consequently, the company cut its consolidated annual copper production target to between 300,000 and 325,000 tons, while raising company-wide cash cost expectations to between US$1.95 and US$2.15 per pound.

Operations at the nearby Candelaria mine remain unaffected by the second storm, with full-year production still projected at 135,000 to 145,000 tons of copper.

During the initial storm in July, Candelaria maintained continuous mill operations using ore stockpiles while open-pit mining briefly paused.

The weather disruptions follow a second quarter in which Lundin Mining generated US$1.2 billion in revenue, driven by total output of 76,877 tons of copper and 33,427 ounces of gold.

Strong operational cash flow enabled the company to maintain a net cash position of US$79.0 million at the end of June, despite spending US$215 million in April to acquire an additional 5 percent interest in Caserones and 30.9 percent interest in the Los Helados project.

Concurrently, the miner is advancing its long-term growth pipeline in South America.

In Argentina, its Vicuña project secured Long-Term Strategic Export Project status under the country's Incentive Regime for Large Investments as the company targets a Stage 1 sanction decision by year-end.

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Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article