Over a decade of successful OM collaboration

FLSmidth O&M Operations meeting in Los Pelambres

FLSmidth has provided maintenance service to Los Pelambres, an Antofagasta Minerals Project in Salamanca, Chile, for the past 13 years and recently renewed and expanded the contract.

The evolution of FLSmidth—from being primarily an equipment supplier to becoming one source for equipment, engineering and maintenance—is evident at Los Pelambres.

As one of the leading producers of copper and molybdenum in Chile, the Los Pelambres mine, owned by Antofagasta Minerals, produces 210 KTPD of primary and secondary ore per day.

Since the turn of the century, FLSmidth has played a significant role in the mine’s growth and success.

FLSmidth has been with the company since the beginning of operations at Los Pelambres and has supplied all the major process equipment in the plant. Simply providing equipment, though, is just scratching the surface of what FLSmidth has to offer.

“Operating and maintenance costs over the life of any mine far outweigh the purchase price,” says Shahid Abdullah, FLSmidth Global Director of O&M. “As a well-acknowledged OEM supplier with more than 130 years of know-how, a pool of 15,800 qualified employees and specialists all over the world, a rigorous R&D and training setup, smart systems and spares services, FLSmidth—through its Operation & Maintenance services—brings a unique One Source solution-based partnership to clients throughout the lifetime of their investments.”

With this approach, FLSmidth has provided maintenance service to the mine for 13 years, and the two companies recently renewed and expanded the contract for another five years. The contract initially involved specialty mechanical, electrical and instrumentation maintenance and has developed to encompass maintenance planning.

The O&M team from FLSmidth is responsible for the realization of major maintenance programs and overhauls, as well as the administration of the client’s maintenance budgets.

“Each of the contract renewals brings with it new aspects,” says Luis Avalos, FLSmidth O&M Manager, Chile. “The last renewal considers the incorporation of an organization capable of being self-sufficient in the resolution of problems. Proposals for maintenance improvement have also given priority to enhancing the competence of operations personnel, guaranteeing a skilled staff and a climate of excellence.”

More than a decade of focused cooperation has fostered a unique bond between FLSmidth and Antofagasta Minerals. The two companies have developed a partnership that is the first of its kind in Chile, and the evolution of FLSmidth—from being primarily an equipment supplier to becoming One Source for equipment, engineering and maintenance—is evident at Los Pelambres.

“The involvement in the customer's business is key,” Avalos says. “We have a staff that’s committed to the values of the customer. FLSmidth’s O&M team has also worked together with the client to improve methods and facilities in search of increased safety and health, maintainability and asset protection.”

The integrated partnership has delivered excellent results in the areas of improved safety, availability, reliability and return on investment. The operation is now among the industry leaders in plant availability.

The various expansions and contract renewals have also opened up a significant amount of new job opportunities, with the number of positions increasing from 100 at the onset, to 350 currently.

The ongoing success of the partnership requires a high level of understanding between the two companies.

“To the extent that each of the parties mutually engages and recognizes the partner’s commitment, they can demand and safeguard the conditions that each requires to maintain adequate performance,” Avalos says.

A commitment to maintain a long-term and sustainable relationship, based on a "win-win" culture, is the key to this success. In this regard, Los Pelambres has been a pioneer in establishing and developing such relationships.

That relationship, though, didn’t just happen—it developed over years of continuously meeting the expectations of clients, even as those expectations increase.

The integrated maintenance service has produced:

  • An increase in plant availability from 93% in the first year to 96% today, generating approximately $50 million of additional income per year
  • Quality work procedures
  • Process and equipment improvements
  • Major shutdown planning involving more than 700 personnel, 6,000 parts and over 2,000 discrete activities

“It is difficult to think of renewing a contract or negotiating directly with the client when operational, financial or safety results have been of high variability,” Avalos says. “The guarantee to continue in this project was built during each day of the agreement that preceded it, based on the fulfillment of the objectives in quality, safety and health and performance of our operations in a climate of high trust and transparency.”

To this end, FLSmidth’s work at Los Pelambres provides a stepping stone to greater involvement not only at that site, but in other projects both in Chile and around the world.

“There is the possibility of increasing the scope in other areas of the Los Pelambres project, but I think that the more relevant challenge is to grow in Antofagasta Minerals,” Avalos says. “Because then we can replicate the high performance of these services to other companies.”

CONTACT: Shahid Abdullah