Escondida Mine

Copper is a metal long familiar to mankind. As it has high electrical conductivity at a relatively affordable cost, it is used extensively, from electric wiring to electric appliances and to the most unexpected applications, such as antimicrobial socks, carpets and mats.

Japan used to be a major copper producer in the Edo and Meiji periods. Today, however, there is no copper mine of any significance, and almost all copper ore is imported. During the high growth period, as Japanese trading companies and other firms were roaming around the globe for acquiring interests in overseas copper mines to secure its long-term and stable supply, their attention was drawn to Chile.

Today Chile makes up over one-third of the world copper production and reserves, and Japan depends on Chile for about 50% of its total imports of copper concentrate. In particular, Minera Escondida, the world's largest copper mine, is the largest supply source to Japan.

In 1988 when the development of this copper mine started with Japanese companies acquiring interests in part of this development project, JBIC provided a loan in project financing to the locally incorporated project company, while assuming project risk and country risk, thereby supporting the supply of copper to Japan. Since then, JBIC has continued to provide a series of loans for the expansion of production. As recently as 2004, a US$300 million loan was offered in co-financing with private financial institutions to support the Japanese-participated copper mine development project.

Amazon Aluminum Project

JBIC is also deeply involved in the supply of aluminium, a metal widely used for automobiles, aircraft, other transport equipment, beverage cans, building materials, and IT products. Since extraction of aluminium from bauxite ore through electrolysis consumes a lot of electric energy, aluminium is also known as "canned electricity."

Although almost all aluminium was smelted in Japan until the 1970s, when increased costs of electricity in the wake of the two oil shocks made domestic production unprofitable. Japanese aluminium manufacturers thus moved their smelting plants overseas. Today Japan imports nearly all aluminium ingots from abroad.

It was against this background that the Japanese government has promoted overseas alumina refinement and aluminium smelting as the national policy. In this context, JBIC played a major role as an official financial institution.

A case in point is the Amazon Aluminium Project in Brazil. Since the establishment of Alumina Do Norte Do Brasil S/A (Alunorte), a Brazilian corporation, in the late 1970s, JBIC has provided several loans for this project. In 2005, JBIC extended a loan totaling US$300 million in co-financing with private financial institutions to finance its capacity expansion.

The alumina produced by Alunorte will be supplied to Alumínio Brasileiro S.A. (Albras), a Japan-Brazil joint venture operating an aluminium smelting plant, and the aluminium ingots thus produced will be supplied to Japan. The project has successfully increased output, growing into one of the most important supply sources of aluminium ingots to Japan.