LOTA COAL MINING I

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The Lota Coal Mine Modernization Project will provide a loan to the Compania Carbonifera e Industrial de Lota, which owns and operates the largest coal mine in Chile. The project involves the development of a new shaft mine, and the modernization of the haulage and surface installations. The project is soundly conceived from an engineering point of view. The main effect should be to reduce costs of production. It should also result in some increase in annual output capacity. Output could eventually be increased further by about 25 percent if conditions justified it. The proved reserves are adequate to support the planned rate of output until 1970, by which time further reserves will have been proved. The Company is well managed, but its technical staff needs strengthening and some reorganization. Labor relations are good, and the supply of labor is adequate. However there is a need of more supervisors underground.