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TheStreet Open House

Chile's Huge Open-pit Copper Mine Goes Underground

LUIS ANDRES HENAO

CHUQUICAMATA, Chile (AP) â¿¿ From above, it looks like a colossal amphitheater carved from rock, or the vast crater from a meteorite that crashed into Chile's Atacama desert ages ago.

Inside the world's largest open-pit copper mine, dump trucks as big as two-story houses work around the clock to haul hundreds of tons of rock and minerals 2,790 feet (850 meters) to the surface of this elliptical, seemingly endless, man-made hole.

But the open pit has run its course at Chuquicamata â¿¿ the storied mine that awoke the political awareness of a young Ernesto "Che" Guevara in the 1950s, inspired Marxist President Salvador Allende to nationalize the copper industry in 1971 and generated decades of prosperity for Chile.

After a century of exploitation, Chuquicamata has become too big, too deep and too old to continue digging in the open-pit method. The giant trucks that carry copper ore each guzzle 819 gallons (3,100 liters) of fuel a day driving 7 miles (11 kilometers) to the surface with ever-poorer loads as ore grades decline and copper yields fall.

Chuquicamata produced 443,000 tons of copper last year, but experts say that by 2019 it will be unprofitable.

So state-owned mining company Codelco is trying to head off closure by taking the daring step of converting the open pit into the world's largest underground mine.

Codelco believes the mine still has much more to give, with reserves equal to about 60 percent of all the copper exploited in the mine's history still buried deep beneath the crater. It has started digging more than 620 miles (1,000 kilometers) of tunnels underneath the pit in a $3.8 billion project to revive the mine.

"The technological challenges are enormous. We're talking about changing the biggest open pit copper mine in the world to the biggest underground mine in the world. This type of project is unique," said Juan Carlos Guajardo, head of CESCO, a Santiago-based mining think tank.

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