|Papua New Guinea copper mine cost rises, GRAM says
A Chinese conglomerate planning to develop the Frieda River copper project in Papua New Guinea has more than doubled the estimated construction cost for the mine to $3.6 billion after boosting its potential production capacity.
State-owned Guangdong Rising Assets Management Co (GRAM) bought into Frieda River in 2015, in line with moves by Chinese companies to pursue offshore copper mines to feed demand in the world's biggest user.
The project has still to gain formal financing and no date has been set for construction, said Joe Walsh, corporate development officer at GRAM subsidiary PanAust.
The capital cost for Frieda River is more than double the $1.7 billion estimate made in September 2014 by PanAust, before it was acquired by GRAM for around $950 million.
The increase reflects a larger annual production capacity, as well as extra spending on waste management and rising construction costs, according to a document released by Highlands Pacific Ltd, which has a 20 percent stake in the project.
An additional $2.3 billion will also be spent over the life of the mine, the document said.
Copper has been earmarked as one of the few growth markets for mining companies stung by a slowdown in metals directly related to steelmaking, such as iron ore and nickel.
China Molybdenum paid $2.65 billion for Freeport McMoran's majority stake on the Tenke copper project in Democratic Republic of Congo this month.