Valle de Elqui iron ore mine

Valle de Elqui is a mining complex owned by the Chilean steel producer Compañía de Acero del Pacífico (CAP) with operations around to the city of La Serena, approximately 470 kilometres north of Santiago. The area is comprised of the operating El Romeral mine, the recently-developed Pleito (Tofo Norte) deposit and the undeveloped Cristales one. The complex produces a mix of fines, lump and concentrate products which are entirely sold into the seaborne export market. Valle de Elqui's production reached an eight-year high in 2020 as CAP increased output at the location to offset lower volumes from Valle de Huasco. We expect output to drop 20% in 2023, after the full resumption of the operations at Valle de Huasco. On the cost front, Valle de Elqui's C1 direct cash cost is set to increase by 11% in 2022, as a result of mounting inflation and higher diesel prices.