"Chile has been a pioneer in the electric market, and due to the accessibility to renewable resources, the cost of energy is low in comparison to other jurisdictions."

Jose Rodriguez Monje

GENERAL MANAGER, AGGREKO CHILE

May 17, 2024

How were Aggreko’s results during 2023?

In mining, Aggreko achieved 7% better results than projected. Concerning technology, we are starting to work hard on accompanying customers in decarbonization. We identified four clients for whom we can start providing storage technology, change solutions to hybrid ones, and change thermic operations to solar ones. We have a strong service contract with Pelambres and are actively working with SQM.

What distinguishes Chile from the rest of the world?

Chile has been a pioneer in the electric market, and due to the accessibility to renewable resources, the cost of energy is low in comparison to other jurisdictions. 

With the right initiatives, Chile has the potential to transform itself into a world reference in the production of lithium, although currently, Chile still lags behind Argentina. The state will be fundamental to the development of lithium projects.

In society, mining is a highly questioned industry for the impact it has on the natural world. However, Chile is fundamentally a mining country. The economy is supported and maintained by the activities of the sector. Unlike jurisdictions like Peru, where social problems can get in the way of mining activities, Chile has a regulatory framework that allows for control. 

Aggreko is looking to expand into the lithium market in Catamarca, Salta, and Jujuy. Can you discuss these plans?

In 2022 we decided to open a yard in Salta to go along with the growth of northwest Argentina with lithium. From this strategic location we serve our businesses in the three provinces. Today we can say that it was a good decision. We currently have more than 30 MW of generation and we operate with all mining companies that are in different stages of development of their projects.

What technologies is Aggreko investing in to help clients reach sustainability goals?

We want to change the technology of air compressors so that diesel is replaced by electric compressors. This will lead to no emissions. Nearly all the large mining companies in Chile are committed to reducing emissions by 30% by 2030. 

What is the process of changing energy sources from diesel to renewable?

The process is not difficult. Large mining companies have such large energy demands, that they mainly acquire this energy through large Power Purchase Agreements (PPA). However, the backup plants of their critical processes can easily and quickly be changed to renewable energy sources. This is our expertise, and we see a great opportunity for this. 

What factors are impeding the growth of the Chilean mining sector?

On average, in Chile, it takes 10 years to approve a project, which discourages investors from coming to the country. In Peru, on the other hand, you can get a project running in 2.5 years, but social issues can affect the development of new projects. In Peru, there is great potential to install our technologies. As a country, they are agile and receptive. 

Chile lacks big projects to propel itself forward. Looking at big mining projects, Quebrada Blanca underwent expansion, which has ended, Pelambres made a small expansion and Codelco has abstained from making investments. This led to a stall in the market. The problem is not that companies do not want to invest. The interest is there. The state is not approving the projects. 

What is Aggreko’s competitive advantage and how will this be used to reach the company’s goals?

We are flexible and agile, and we offer energy solutions that are efficient, reliable and sustainable. We have the economic power to support what we do. We are quick and do not leave our clients without energy. We are the biggest company in the world with this type of solution. We have 10 GW of installed capacity. We have control of all the strategic ports in the world. This gives us speed.

Our goal is economic growth, which will be based on medium and long-term contracts. Long-term contracts will also allow clients to reach their sustainability goals more easily. We want to support our clients in the shift towards decarbonization. In 2025, we hope 20% of our revenue will come from alternative solutions. As a company, our decarbonization goals align with those of the state. Our goal is also to reach 25% female inclusion by 2025.

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