Following the fatal collapse at El Teniente, Codelco’s chairman, Máximo Pacheco, announced the commissioning of an international audit after facing the worst tragedy to hit the state-owned company in 35 years.
By Ignacia Munita
Following the fatal collapse at El Teniente, Codelco Chairman Máximo Pacheco announced the commissioning of an international audit, as the company confronts the most serious tragedy it has faced in 35 years. While the investigation is underway, experts warn that the incident has already “exposed vulnerabilities in one of Codelco’s most emblematic operations.”
The collapse occurred last Thursday at the Andesita sector—one of the deepest levels of El Teniente, the world’s largest underground mine operated by Codelco—triggering an urgent rescue operation to locate the miners trapped underground.
Specialists who previously participated in the 2010 rescue of the 33 miners at the San José mine were also involved in the response effort.
On the day of the accident, the death of Paulo Marín, a 48-year-old electrician working for the contractor Salfa Montajes, was confirmed. Yesterday, after an intense search effort, the death of the last of the five trapped miners—contractors for the company Gardilcic—was also confirmed. They were found approximately 1,200 meters underground.
Following these events, Chairman Máximo Pacheco held a press conference in which Codelco shared its position regarding the tragic outcome. At that time, he announced that the company would launch an international audit to assess what has become the most severe incident to impact Codelco in 35 years. The previous event of similar magnitude occurred in 1990, when a rock burst in the same underground mine (Level 6) resulted in six fatalities.
The Cost of the Tragedy for Codelco
According to Juan Carlos Guajardo, Executive Director of Plusmining, the incident “has exposed vulnerabilities in one of Codelco’s most emblematic operations, directly affecting its reputation both domestically and internationally. While many voices—including workers and social organizations—have raised concerns about safety protocols, it is essential to proceed with caution and await the results of a thorough investigation.”
Guajardo further stated to The Clinic: “Codelco enjoys strong recognition in Chile, largely due to its status as a state owned mining company. It remains to be seen whether this incident will undermine that perception in the eyes of the Chilean public. These deeper reputational impacts will only become clear time and will also depend on how Codelco manages the situation going forward.”
In terms of the potential financial implications, Guajardo notes that El Teniente accounts for approximately 25% of Codelco’s fine copper output. “The temporary shutdown translates into a direct revenue loss due to reduced sales volume—particularly if the stoppage lasts for weeks or months while the investigation continues.”
He also added: “If the suspension results in long-term impacts on projected production, Codelco may be forced to reassess its accounting provisions or make adjustments to the economic value of assets associated with the Andesita project or the affected zones, which would in turn impact the company’s financial results.”
A former senior Codelco executive, speaking on condition of anonymity, emphasized that beyond reputational damage, the incident highlights the significant geomechanical challenges faced by the El Teniente project. “This is not an indication that Codelco is mismanaging operations. Despite the tragic nature of the event, the market knows that Codelco operates under very high standards. What we are seeing is that El Teniente is now venturing into geomechanically complex zones, which also presents an opportunity for learning,” he said.
Nicolás Román, professor at the Faculty of Economics and Business at Universidad de los Andes, commented on the potential financial impact of the operational suspension. He noted that:
“First, production is typically measured based on refined copper, and revenues are recognized once the product is processed. Currently, copper processing continues, as smelting is considered an essential activity. What has been halted are non-essential operations, such as access to the orebody, worker transport, and of course, extraction activities.”
He added that although extraction is suspended, smelting operations can continue temporarily
due to existing stock. However, if the investigation extends and inventories are depleted, then
the impact on Codelco’s financial results will become evident.
Román concluded: “El Teniente accounts for just under 20% of Codelco’s revenues. Its shutdown implies an estimated daily loss of around US$10 million.”
Source: The Clinic