Codelco has fired an executive and disciplined several others after an internal audit found the world’s biggest copper miner overstated part of its 2025 output by classifying material requiring further processing as finished product.
Chile’s state-owned miner said seven current executives and one former executive were responsible for the improper reporting and that it had referred the matter to public prosecutors to determine whether criminal conduct occurred.
The audit followed a March complaint over the reporting of 20,000 tonnes from its Chuquicamata division and 6,875 tonnes from its Ministro Hales. The material, equal to about 2% of Codelco’s 2025 production, should have been recorded as work-in-process inventory rather than finished output, the company said.
Codelco said the investigation identified improper use of exception rules, failures in mandatory approvals and distortions in the calculation of corporate targets and incentive payments. The company said the findings won’t require changes to its audited 2025 financial statements, though it will revise production disclosures and recalculate bonuses tied to those metrics.
Trust questioned
“This is a serious issue because it reveals weaknesses in control, traceability and operational validation,” Juan Carlos Guajardo, executive director of Plusmining consultancy, told MINING.COM.
The controversy is significant because the additional tonnes helped Codelco meet its December production target, delivering the company’s strongest monthly output this decade and far exceeding the January-to-November average of 105,600 tonnes, Guajardo said.
“For a state-owned company as important as Codelco, trust in operational information is almost as important as financial information,” he said.
Chile economy and mining minister Daniel Mas sharply criticized the company’s management. “Codelco is out of control,” Mas said, adding that President Jose Antonio Kast’s government had a duty to restore transparency and accountability.
Leadership shift
The audit fallout comes days before economist Bernardo Fontaine, a longtime critic of Codelco’s governance and efficiency, is due to become chairman.
It also follows reports of an ambitious plan to integrate the Chuquicamata, Radomiro Tomic and Ministro Hales mines in northern Chile. The proposal aims to generate a combined $2 billion in savings and additional revenue as part of a broader four-year production strategy Codelco plans to present to the government in coming months.
