The new venture for the centennial open pit mine has 1.03 million tonnes of copper mineral reserves, at 0.82% content, the miner added. These volumes will result in 320,000 tonnes per year of copper production by 2026.

Productivity at the underground Chuquicamata mine, however, is expected at 61 tonnes per person, increasing from 44 tonnes per person in the current open pit phase, Codelco stated.

Chuquicamata is located near Calama city, in the northern region of Antofagasta. The open pit mine has been operating for 104 years and Codelco plans on maintaining it until 2020, when it will move completely to underground output.

The division produced 84,000 tonnes of refined copper during the first quarter of 2019, growing from 70,000 tonnes a year before, while output across all the other units decreased on an annual basis.

Despite the switch from an open pit to an underground mine potentially denting overall production while subterranean Chuquicamata throughput increases, Codelco is confident it will keep its output at 1.68 million tpy in the next decade, compared with 1.69 million tonnes tpy in the previous 10 years.

Chuquicamata faced hard labor negotiations this year amid the switch, resulting in a workers’ strike that cut Chuqui’s production by 50% over half a month.

The Chuquicamata flash smelter was also halted for several months from the end of 2018 into 2019 until it began ramping up output in May, during which time construction works were carried out to comply with new Chilean emissions standards.

The supply disruptions at mines and a lack of sufficient projects that will increase global output in the future have been pressuring treatment and refining charges (TC/RC) this year.

Fastmarkets’ copper concentrates TC/RC index, cif Asia Pacific last stood at $49.80 per tonne/4.98 cents per lb on August 9, the lowest level since its launch in 2013. Comparatively, copper TC/RCs were at $84.30 per tonne/8.43 cents per lb on December 31, 2018.

"With projects [such as the underground mine at Chuquicamata], we are committed to reposition Codelco as one of the most competitive, sustainable and profitable copper producers in the world," the company's chairman, Juan Benavides, said.

The state-owned miner spent $5 billion in total investments for the project and expects to employ up to 2,200 people in the underground operation.