BHP, Rio commit to Escondida

Miners each invest over $1bn to construction of second desalination facility.

BHP Billiton Ltd and Rio Tinto Ltd have committed over $1 billion each to sustain operations at their Escondida project in Chile through the construction of a second desalination facility.

In a statement, BHP said it had approved an investment of $US1.972 billion ($2.136 billion) to the project which would be used to construct a new 2,500 litre per second sea-water desalination facility.

"The project will ensure continued water supply to Escondida, as water use increases upon completion of the 152,000 tonne per day OGP1 copper concentrator," BHP said.

In a separate announcement Rio Tinto said it would also invest $US1.03 billion in the construction of the second seawater desalination facility.

Rio said it will fund its share of the investment through the company’s share of Escondida’s cash (see Tim Treadgold's Re-examining Rio).

Construction of the new facility is slated to commence this month, and will include the development of two pipelines, four high pressure pump stations, a reservoir at the mine site and high voltage infrastructure to support the system.

BHP said the new facility will be commissioned in 2017.

The mining giant's copper president Peter Beaven said securing sustainable water supply was a major priority for Chilean copper producers.

"The new desalination facility will minimise our reliance on the region’s aquifers, which will help us to meet our environmental commitments and enable us to achieve our long-term business strategy," he said.

BHP Billiton owns 57.5% of Escondida, while Rio Tinto owns 30%.

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