The Minister of Mining, Aurora Williams, explained that the sale of 10% responds to the need to generate resources in the short term and ensure the continuity of the promotion of small and medium-sized mining.
In an operation valued at US$520 million, the National Mining Company (Enami) completed the sale of its most important asset to Codelco this week: 10% of the stake in “Quebrada Blanca” owned by the Canadian company Teck, located in the Tarapacá Region.
Codelco will benefit from the dividends it will receive from the project's operations, the maintenance of its percentage of participation in the event of capital increases, and the appointment of two of the company's eleven directors.
For Enami, the sale is a financial relief, and the company's executive vice president, Iván Mlynarz, said that "it allows us to get out of the debt overhang and become a company with manageable debt," detailing that its debt load would go from US$740 million to US$250 million.
However, this has generated criticism from mining unions and the political world, arguing that this business does not guarantee that state-owned companies will emerge from their respective crises.
For Codelco, the operation would make sense to expand its copper operations and increase its production, and on the other hand, to partner with another major global mining player such as Teck, which controls 60% of Quebrada Blanca.
This was stated by the Chairman of the Board of Codelco, Máximo Pacheco, who said that “our strategy of development and strengthening of the company through partnerships will allow us to strengthen our position in the copper and lithium markets and, thereby, increase the value contribution that Codelco makes to the country.”
The Minister of Mining, Aurora Williams, who also chairs the board of directors of Enami, explained that the sale of 10% of Quebrada Blanca responds to the need to generate resources in the short term and ensure the continuity of the promotion of small and medium-sized mining.
"We believe that our responsibility as a government is to promote Enami, and from that point of view, the transaction aims at the viability of the sector, at the small and medium-sized miners of our country," said the minister.
In the private sector, this agreement has been questioned for a number of reasons. On the one hand, there is the lack of a public tender that would ensure greater competitiveness and thus have the best possible offer.
On the other hand, there was criticism that the process was held behind closed doors, in secret sessions, and was not analyzed by the board of directors of the copper corporation. This was commented by the president of the National Mining Society (Sonami), Jorge Riesco.
The president of Sonami added: “What we are going to ask is that this be thoroughly reviewed by all the State control bodies, to ensure that this is done at a fair price.”
A “repeated story”
Another argument put forward by the business community is that the sale of Enami assets to Codelco would be a “repeated story”. In 2005, the transfer of the Ventanas Smelter to the state copper company was completed for US$393 million.
Later, in 2008, Enami gave Codelco its preferential option to purchase 49% of Los Bronces from Anglo American.
According to the president of the Chilean Mining Chamber, Manuel Viera, this type of business is an attempt to hide "the poor management of state-owned companies under different governments, which generate more debt than profits."
"It is a management and governance problem. Therefore, Enami definitely needs to be restructured so that it becomes an efficient company again, worthy of all Chileans," said Viera.
Rejection also in Congress
In Congress, in the Mining Committees, there is widespread rejection of this transaction.
Within the ruling party, the deputy of the Green Social Regionalist Federation, Jaime Mulet, said that with the closure of Paipote, the dismissal of workers, and the sale of this valuable asset, the current administration of Enami has been one of the worst in its history.
Meanwhile, the senator of the National Renewal Party, Rafael Prohens, said that it is a profitable business for Codelco, but a disgrace for the National Mining Company.
The income that Codelco will receive from its recent acquisition of 10% of Quebrada Blanca will only be recorded from 2031 in dividends that will extend for two decades, which on average will amount to about US$100 million annually.
