Operations at the Toromocho openpit copper mine in Peru began on Dec. 10.
The mine, owned by China's state-owned Chinalco Mining Corp. International is expected to give a significant boost to Peru's copper production and give a kick-start to the economy.
President Ollanta Humala officially launched production in a ceremony at the mine site 4,800 m above sea level in Peru's central Andean region, the Wall Street Journal reported.
"Together with Chinese investors we are going to work to increase the value of this region," Humala said.
The mine is unique in that it is owned by a Chinese company, and is the first to be set up from the start by a Chinese company. A number of other mining properties may also be developed by China-based companies in South America, such as the El Galeno and Rio Blanco copper projects in Peru. In Ecuador, Chinese-owned Ecuacorriente plans to start mining copper deposit Mirador by the end of 2015, according to the Wall Street Journal.
Initial costs to bring Toromocho to production were $3.5 billion. The company announced earlier this year that it plans to spend an additional $1.3 billion on an expansion project. The company estimates production of 1 Mt/a (1.1 million stpy) of copper concentrate a year.
Peru's Energy and Mines Ministry says the mine will eventually turn out about 250 kt/a (275,000 stpy) of refined copper. Toromocho will also produce molybdenum and silver.
Peru trails Chile and China in global copper production, but government officials hope various new mines could help double Peru's production by 2016.
Scotiabank forecasts that Toromocho will boost Peru's copper output by 16 percent when it hits expected full production in mid-2014.
Peru's government is counting on the start-up of large mine projects such as Toromocho to help reverse this year's slowdown in economic growth. Peru's economy is expected to grow by about 5% this year, from 6.3 percent in 2012.
Demand for copper remains strong in China to fuel its industrial development. Latin America has become a priority for Chinese resource companies, which can often take a longer view than companies focused on short-term profitability.