Codelco will turn to banks to cover financing gap -newspaper

LIMA Aug 10 (Reuters) - Chile's state-owned Codelco, the world's top copper producer, plans to ask banks to help finance its investments this year after being promised less capital from the government than it expected, a local newspaper reported, citing its chief financial officer. Codelco CFO Ivan Arriagada told El Mercurio that the company now has only about $2.7 billion of the $4.5 billion in capital it originally forecast for this year."We'll cover the balance for financing the investment plan this year with other sources of local and foreign bank financing," Arriagada was quoted as saying in a report on Saturday.The Chilean government, which receives all of the firm's profits, has said it will give back $1 billion of its 2012 proceeds to help the miner meet financing needs. Codelco said it needs more.The company's battle for capital comes as it struggles to rein in costs while global copper prices tumble.Arriagada said the firm will cut back on capital expenditures while striving to move forward with important projects to help offset declining ore grades at its ageing deposits.Codelco has said it wants to spend about $27 billion through 2016 to boost annual output from roughly 1.7 million tonnes of copper to more than 2 million tonnes.But some initiatives will take longer to roll out, Arriagada said, such as the expansion of the Andina mine, which the company hopes to turn into its main operation in coming years.

This article is taken from Reuters.com