UPDATE 1-Anglo American says wins license for slurry pipe at Brazil mine

miércoles 24 de septiembre de 2014 11:58 GYT

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RIO DE JANEIRO, Sept 24 (Reuters) - Miner Anglo American said on Wednesday it won environmental regulatory approval to operate the slurry pipe at its Brazilian iron ore project Minas Rio, a crucial step in meeting a deadline to enter production by the end of the year.

The slurry pipe, used to transport iron ore to the coast for export, has been a major headache for Anglo American. The licenses required to lay and run it have contributed to putting the project years behind schedule and way over budget.

"The receiving of the operating licence for the slurry pipe is a very important step towards first production of iron ore at Minas Rio," said Pedro Borrego, Anglo American's director of corporate affairs for iron ore in Brazil.

The slurry pipe approval came from Ibama, Brazil's environmental agency.

Anglo American said it was still waiting on the operating license for the mine and processing plant.

The miner reiterated that production will start by the end of the year, saying 95 percent of the work needed to begin production was already done. The mine will have a capacity of 26.5 million tonnes per year which should be reached within 18-20 months of starting.

Production for next year is forecast at between 11 and 15 million tonnes.

Anglo is investing around $2.2 billion in 2014 on the project, with a further $1 billion marked for next year, which will take the total cost to about $8.8 billion.

When the company first bought into the project seven years ago it predicted the mine would be in production by the end of 2009, with a total cost of $2.35 billion.

(Reporting by Stephen Eisenhammer; Editing by Jeffrey Benkoe and W Simon)