Rapid development and growth of revenue of the Sierra Gorda mine - KGHM recognises the value of the investment in Chile at USD 504 million

The accounting recognition of the investment in Sierra Gorda at the level of USD 504 million is a landmark moment in the history of KGHM's Chilean mine. Thanks to significant improvements in operational and cost efficiency, Sierra Gorda has not only covered its historical losses, but also continues to repay its liabilities to KGHM. Between 2021 and 2025, Sierra Gorda returned nearly USD 1 billion to KGHM. 

“The optimisation measures implemented over a period of several quarters have contributed to a systematic increase in the importance of the foreign assets in the financial results of the KGHM Group. The valuation of the Group's share in the Sierra Gorda mine confirms its good business standing and allows us to be optimistic about the further development not only of our Chilean mine, but also of our other international assets,” said Remigiusz Paszkiewicz, President of the Management Board of KGHM Polska Miedź S.A. “The international assets are an important element of the revenue structure of the KGHM Group, and their further development will strengthen the Group's resilience to market turbulence, while creating additional value for the shareholders,” added President Paszkiewicz. 

Ambitious development plans

“The current momentum in the operational and financial performance of our key international asset provides a solid foundation for its further development. Together with our partners, we are taking a very ambitious approach to the future of Sierra Gorda, focusing on both further increases in operational efficiency and revenue-generating capacity, and the extension of the life of the mine,” said Anna Sobieraj-Kozakiewicz, Vice President of the Management Board (International Assets) at KGHM Polska Miedź S.A. ‘We have a high level of competence and experience in managing complex mining projects, which strengthens our position in the global non-ferrous metals market,” she added.  

Sierra Gorda is one of the leaders of the mining sector in South America in terms of safety, new technologies and cost efficiency. The mine’s management is working closely with the owners, focusing on analysing investment projects intended to significantly increase its production capacity and extend the life of the facility. After the first three quarters of 2025, Sierra Gorda achieved revenues of USD 1.48 billion and a net profit of USD 291 million. KGHM owns a 55% stake in Sierra Gorda S.C.M. 

The road to profitability

The Sierra Gorda mine became part of the KGHM Group in 2012 following the acquisition of the Canadian company Quadra FNX. The project was then in the construction phase. In 2015, following the commencement of commercial operations, declining metal prices and the production results achieved in the initial phase provided KGHM with the rationale to recognise significant impairment losses on its investments. KGHM has been working to improve the operational efficiency, increase the production volumes and optimise the costs at the Chilean mine. Since 2021, Sierra Gorda S.C.M. has been generating a net profit, which enabled it in 2025 to cover the losses incurred during the first years of operation. In addition, in 2021, Sierra Gorda began the process of repaying its liabilities to its shareholders. In 2021-2025, KGHM received close to USD 1 billion in this regard.  

Valuation of the investment in Sierra Gorda

By the end of 2025, Sierra Gorda had covered all of its past losses and there are indications of a significant improvement in projected future cash flows. This allowed a new valuation of the investment to be prepared. The fair value determined provided the basis for recognising the value of the investment in Sierra Gorda at USD 504 million.