Key Chilean copper mines restart after blackout

Two weeks after an 8.8 -magnitude earthquake most of the country was left without power when a transformer failed in the central electricity grid

SANTIAGO (Reuters) - 

Key mines in Chile resumed operations after energy supply returned on Monday following a massive blackout in the top copper producer two weeks after an earthquake killed hundreds and damaged the main power grid.

Chile state miner Codelco's Andina and El Teniente mines restarted operations after the power disruption late on Sunday. Antofagasta Minerals' (ANTO.L: Quote) Los Pelambres copper mine was also returning to normal, a company official said.

The three mines last year produced about 900,000 tonnes of copper, or 17 percent of the country's annual output. Most of Chile's copper is extracted in the northern region, which is powered by a grid that was not affected by the Feb. 27, magnitude 8.8 quake and continued to function normally on Sunday.

Most of Chile was left without power on Sunday evening after a transformer failed in the central electricity grid.

Shaky energy supply could continue to afflict mines in the central region, lifting copper prices on concerns of supply disruptions in a country that produces around a third of the world's mined copper.

The country's biggest oil refineries have remained down after the earthquake damaged installations last month. The Bio Bio refinery, which has a capacity of 116,000 barrels of oil per day, could remain idle for several months while repairs are made, union officials said.

Sunday's power cut rattled the nerves of Chileans still living with aftershocks following the deadly quake that triggered tsunamis and tore up roads and towns, causing an estimated $20 billion to $30 billion in damage.

The blackout was another test for conservative President Sebastian Pinera, who took office last week and faces the task of rebuilding after the disaster.

The government said late on Sunday that the electricity grid was fragile due to damage from the quake and asked Chileans to use less energy, warning that more outages could hit the South American country.

Codelco's smallest division, Salvador, which produces around 60,000 tonnes of copper per year, had problems resuming operations early on Monday.

The status of operations at Los Bronces and El Soldado mines owned by Anglo American (AAL.L: Quote) was unclear. A company spokesman in Chile was not immediately available for comment.

The Feb. 27 quake briefly halted Anglo American operations and that of other mines in the central region. (Reporting By Alonso Soto and Fabian Cambero; Editing by Hugh Bronstein and Stacey Joyce)

© Thomson Reuters 2010 All rights reserved

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