Codelco announced the closure of a US$600 million climate financing provided by HSBC and Banco Santander, guaranteed by the World Bank's MIGA, to fully decarbonize its energy matrix by 2030. This deal adds to a similar US$532 million financing secured in 2024. The funds will support the renewal of electricity supply contracts with renewable sources.
Codelco, Chile's state-owned mining company, finalized a US$600 million climate financing from The Hongkong and Shanghai Banking Corporation Limited (HSBC) and Banco Santander, guaranteed by the Multilateral Investment Guarantee Agency (MIGA) of the World Bank Group. This financial tool is aimed at fully decarbonizing its energy matrix by 2030.
The deal builds on Codelco's first such financing in 2024 for US$532 million, provided by Crédit Agricole and also backed by MIGA. Specifically, the funds will renew electricity supply contracts with renewable energy sources, as stated by the company.
The decarbonization plan has been in place since 2018, featuring key milestones such as the signing and renegotiation of contracts with Engie, Colbún, and AES Andes. Additionally, new public tenders for renewable energy totaling 1.8 TWh per year were awarded, enabling 85% renewable electricity in the matrix by 2026. A recent achievement is the decarbonization of the last Engie contract at Chuquicamata, ensuring the complete phase-out of fossil fuel-based contracts before 2030.
Codelco accounts for nearly 9% of the country's electricity consumption, making this progress a major contributor to reducing greenhouse gas emissions and meeting Chile's climate commitments. “The completion of this second transaction reflects Codelco's commitment to innovation, environmental responsibility, and long-term value creation for the country, as part of our purpose to be the pillar of sustainable development for Chile and the world,” said Rubén Alvarado, Codelco's executive president.
Alejandro Sanhueza, vice president of finance, added: “This financing consolidates the use of innovative and multilateral instruments in our financial strategy, strengthens the diversification of funding sources, reduces risks, and decisively supports our sustainability agenda.”
