Southern Copper Corporation is one of the largest integrated copper producers
in the world. Our major production includes copper, molybdenum, zinc and silver.
All of our mining, smelting and refining facilities are located in Peru and
Mexico and we conduct exploration activities in those countries and in Argentina,
Chile and Ecuador. Our operations make us one of the largest mining companies
in Peru and Mexico. We believe we have the largest copper reserves in the world.
We were incorporated in Delaware in 1952 and have conducted copper mining operations
since 1960. Since 1996, our common stock has been listed on both the New York
and Lima Stock Exchanges.
Our Peruvian copper operations involve mining, milling and flotation of copper
ore to produce copper concentrates and molybdenum concentrates; the smelting
of copper concentrates to produce blister and anode copper; and the refining
of anode copper to produce copper cathodes. As part of this production process,
we also produce significant amounts of molybdenum concentrate and sulfuric acid.
Our precious metals plant at the Ilo refinery produces refined silver, gold,
and other materials. Additionally, we produce refined copper using solvent extraction/electrowinning
technology ("SX-EW"). We operate the Toquepala and Cuajone open-pit
mines high in the Andes Mountains, approximately 860 kilometers southeast of
the city of Lima, Peru. We also operate a smelter and refinery west of the Toquepala
and Cuajone mines in the coastal city of Ilo, Peru.
Our Mexican operations are conducted through our subsidiary, Minera Mexico
S.A. de C.V. ("Minera Mexico"), which we acquired in 2005. Minera
Mexico engages primarily in the mining and processing of copper, molybdenum,
zinc, silver, gold and lead. Minera Mexico operates through subsidiaries that
are grouped into three separate units. Mexicana de Cobre S.A. de C.V. (together
with its subsidiaries, the "La Caridad" unit) operates La Caridad,
an open-pit copper mine, a copper ore concentrator, a SX-EW plant, a smelter,
refinery and a rod plant. The La Caridad refinery has a precious metals plant
which produces refined silver, gold and other materials. Operadora de Minas
e Instalaciones Mineras S.A de C.V. (the "Buenavista unit") operates
Buenavista, an open-pit copper mine, which is located at the site of one of
the worlds largest copper ore deposits, two copper concentrators and three
SX-EW plants. Industrial Minera Mexico, S.A. de C.V. (together with its subsidiaries,
the "IMMSA unit") operates five underground mines that produce zinc,
lead, copper, silver and gold, a coal mine and a zinc refinery.
We utilize modern, state of the art mining and processing methods, including
global positioning systems and computerized mining processes. Our operations
have a high level of vertical integration that allows us to manage the entire
production process, from the mining of the ore to the production of refined
copper rod and other products and most related transport and logistics functions,
using our own facilities, employees and equipment.
We conduct our operations in Peru through a registered branch (the "SPCC
Peru Branch", "Branch" or "Peruvian Branch"). The SPCC
Peru Branch comprises substantially all of our assets and liabilities associated
with our copper operations in Peru. The SPCC Peru Branch is not a corporation
separate from us and, therefore, obligations of SPCC Peru Branch are direct
obligations of SCC and vice-versa. It is, however, an establishment, registered
pursuant to Peruvian law, through which we hold assets, incur liabilities and
conduct operations in Peru.
Copper is an important component in the worlds infrastructure. It is the
third most widely used metal, after to iron and aluminum. Copper has unique
chemical and physical properties, including high ductility, malleability, thermal
and electrical conductivity, and resistance to corrosion that has made it a
superior material for use in electrical and electronic products, including power
transmission and generation, which accounts for about three quarters of copper
global use, telecommunications, building construction, transportation and industrial
machinery. Copper is also an important metal in non-electrical applications
such as plumbing and roofing and, when alloyed with zinc to form brass, in many
industrial and consumer applications.
Copper is an internationally traded commodity with prices principally determined
by the major metal exchanges, the Commodities Exchange, or "COMEX",
in New York and the London Metal Exchange or "LME." Copper is usually
found in nature in association with sulfur. Pure copper metal is generally produced
from a multistage process, beginning with the mining and concentrating of low-grade
ores containing copper sulfide minerals, and followed by smelting and electrolytic
refining to produce a pure copper cathode. An increasing share of copper is
produced from acid leaching of oxidized ores. Copper is one of the oldest metals
ever used and has been one of the most important materials in the development
of civilization.
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