CODELCO: CORPORACION NACIONAL DEL COBRE DE CHILE 2020-12-10 T-13:07

Corporación Nacional del Cobre de Chile

Casa Matriz

Huérfanos 1270

Santiago
CODELCO Región Metropolitana, Santiago

www.codelco.com

PE-152/2020
Santiago, 10 de diciembre de 2020.

Señor

Joaquín Cortez Huerta

Presidente

Comisión para el Mercado Financiero

Santiago

Ref.: HECHO ESENCIAL. Codelco Chile,
Inscripción Registro de Valores N* 785.

De nuestra consideración:

De conformidad a lo establecido en la Ley N*18.045 y en la Norma de Carácter General N*30 y
Circular N* 1072 de esa Comisión, adjunto acompaño “Formulario Hecho Esencial. Colocación
de Bonos en el Extranjero”, el cual complementa nuestra nota PE-151/2020 enviada con fecha
07 de diciembre de 2020.

Saluda atentamente a Ud.,

La

CAI

UA
Oc aioranpa os és
P esidemta | écutivo

Casa Matriz | Chuquicamata | Radomiro Tomic | Gabriela Mistral | Ministro Hales | Salvador | Ventanas | Andina | ElTeniente | VP
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FORMULARIO HECHO ESENCIAL

COLOCACIÓN DE BONOS EN EL EXTRANJERO

1.0 IDENTIFICACIÓN DEL EMISOR

1.1

1.2

1.3

1.4

1.5

1.6

1.7

Razón Social

Nombre fantasía

R.U.T.

NO Inscripción Reg. Valores
Dirección

Teléfono

Actividades y negocios

Corporación Nacional del Cobre de Chile
CODELCO-CHILE

61.704.000-K

785

Huérfanos 1270, Comuna de Santiago, Santiago
22 690 3000

Ver Anexo 1.

2.0 ESTA COMUNICACIÓN SE HACE EN VIRTUD DE LO ESTABLECIDO EN EL ARTÍCULO 9” E
INCISO SEGUNDO DEL ARTICULO 10* DE LA LEY N”* 18.045, Y SE TRATA DE UN HECHO
ESENCIAL RESPECTO DE LA SOCIEDAD, SUS NEGOCIOS, SUS VALORES DE OFERTA
PÚBLICA Y/O DE LA OFERTA DE ELLOS, SEGÚN CORRESPONDA.

3.0 CARACTERÍSTICAS EMISIÓN

3.1

3.2

3.3

3.4

3.4.1

3.4.2

3.4.3

3.4.4

3.4.5

3.4.6

3.4.7

Moneda de denominación
Moneda total emisión

Portador / a la orden

Series
Monto de la serie
N* de bonos

Valor nominal bono

Tipo reajuste
Tasa de interés

Fecha de emisión

[ Dólares de los Estados Unidos de América (US$). |

[US$ 500.000.000 |]

Bonos registrados a nombre de los tenedores en los
libros de DTC

Bonos 2051

US$ 500.000.000

Ver 3.4.3

US$200.000 mínimo. En caso de sumas superiores,
serán por múltiplos de US$1,000.

N/A

3,150%

07/12/2020

Para cada serie llenar la siguiente tabla de desarrollo:

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Bonos 2051:

El capital de los bonos será pagadero en su integridad a su vencimiento, el día 15 de enero
de 2051.

Los bonos devengarán un interés de 3,150% anual, calculado en base de un año de 360
días, el cual será pagadero en 60 cuotas los días 15 de enero y 15 de julio de cada año, a
partir del 15 de julio de 2021.

N* Cuota | N* Cuota Fecha Intereses Amortización Total Cuota | Saldo Capital
Interés | Amortiz.
1 – 15-jul-2021 9.231.250 – 9.231.250 500.000.000
2 – 15-ene-2022 7.875.000 – 7.875.000 500.000.000
3 – 15-jul-2022 7.875.000 – 7.875.000 500.000.000
4 – 15-ene-2023 7.875.000 – 7.875.000 500.000.000
5 – 15-jul-2023 7.875.000 – 7.875.000 500.000.000
6 – 15-ene-2024 7.875.000 – 7.875.000 500.000.000
7 – 15-jul-2024 7.875.000 – 7.875.000 500.000.000
8 – 15-ene-2025 7.875.000 – 7.875.000 500.000.000
9 – 15-jul-2025 7.875.000 – 7.875.000 500.000.000
10 – 15-ene-2026 7.875.000 – 7.875.000 500.000.000
11 – 15-jul-2026 7.875.000 – 7.875.000 500.000.000
12 – 15-ene-2027 7.875.000 – 7.875.000 500.000.000
13 – 15-jul-2027 7.875.000 – 7.875.000 500.000.000
14 – 15-ene-2028 7.875.000 – 7.875.000 500.000.000
15 – 15-jul-2028 7.875.000 – 7.875.000 500.000.000
16 – 15-ene-2029 7.875.000 – 7.875.000 500.000.000
17 – 15-jul-2029 7.875.000 – 7.875.000 500.000.000
18 – 15-ene-2030 7.875.000 – 7.875.000 500.000.000
19 – 15-jul-2030 7.875.000 – 7.875.000 500.000.000
20 – 15-ene-2031 7.875.000 – 7.875.000 500.000.000
21 – 15-jul-2031 7.875.000 – 7.875.000 500.000.000
22 – 15-ene-2032 7.875.000 – 7.875.000 500.000.000
23 – 15-jul-2032 7.875.000 – 7.875.000 500.000.000
24 – 15-ene-2033 7.875.000 – 7.875.000 500.000.000
25 – 15-jul-2033 7.875.000 – 7.875.000 500.000.000
26 – 15-ene-2034 7.875.000 – 7.875.000 500.000.000
27 – 15-jul-2034 7.875.000 – 7.875.000 500.000.000
28 – 15-ene-2035 7.875.000 – 7.875.000 500.000.000
29 – 15-jul-2035 7.875.000 – 7.875.000 500.000.000
30 – 15-ene-2036 7.875.000 – 7.875.000 500.000.000
31 – 15-jul-2036 7.875.000 – 7.875.000 500.000.000
32 – 15-ene-2037 7.875.000 – 7.875.000 500.000.000
33 – 15-jul-2037 7.875.000 – 7.875.000 500.000.000
34 – 15-ene-2038 7.875.000 – 7.875.000 500.000.000
35 – 15-jul-2038 7.875.000 – 7.875.000 500.000.000
36 – 15-ene-2039 7.875.000 – 7.875.000 500.000.000
37 – 15-jul-2039 7.875.000 – 7.875.000 500.000.000
38 – 15-ene-2040 7.875.000 – 7.875.000 500.000.000
39 – 15-jul-2040 7.875.000 – 7.875.000 500.000.000
40 – 15-ene-2041 7.875.000 – 7.875.000 500.000.000
41 – 15-jul-2041 7.875.000 – 7.875.000 500.000.000
42 – 15-ene-2042 7.875.000 – 7.875.000 500.000.000
43 – 15-jul-2042 7.875.000 – 7.875.000 500.000.000
44 – 15-ene-2043 7.875.000 – 7.875.000 500.000.000
45 – 15-jul-2043 7.875.000 – 7.875.000 500.000.000
46 – 15-ene-2044 7.875.000 – 7.875.000 500.000.000
47 – 15-jul-2044 7.875.000 – 7.875.000 500.000.000
48 – 15-ene-2045 7.875.000 – 7.875.000 500.000.000

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49 – 15-jul-2045 7.875.000 – 7.875.000 500.000.000
50 – 15-ene-2046 7.875.000 – 7.875.000 500.000.000
51 – 15-jul-2046 7.875.000 – 7.875.000 500.000.000
52 – 15-ene-2047 7.875.000 – 7.875.000 500.000.000
53 – 15-jul-2047 7.875.000 – 7.875.000 500.000.000
54 – 15-ene-2048 7.875.000 – 7.875.000 500.000.000
55 – 15-jul-2048 7.875.000 – 7.875.000 500.000.000
56 – 15-ene-2049 7.875.000 – 7.875.000 500.000.000
57 – 15-jul-2049 7.875.000 – 7.875.000 500.000.000
58 – 15-ene-2050 7.875.000 – 7.875.000 500.000.000
59 – 15-jul-2050 7.875.000 – 7.875.000 500.000.000
60 – 15-ene-2051 7.875.000 500.000.000 507.875.000 0
35 Garantías
3.5.1 Tipo y montos de las garantías
No aplica.
3.6 Amortización Extraordinaria:
3.6.1 Procedimientos y fechas:
No aplica.
40 OFERTA: ca 1×7]
5.0 PAÍS DE COLOCACIÓN
5.1 Nombre Bonos vendidos a los Compradores Iniciales (“Initial
Purchasers”) domiciliados en los Estados Unidos de América.
5.2 Normas para obtener autorización de transar
Rule 144 A y Regulation S de la US
Securities Act de 1933 de los
Estados Unidos de América.
6.0 INFORMACIÓN QUE PROPORCIONARÁ
6.1 A futuros tenedores de bonos
Prospecto informativo (“Offering Memorandum”) de fecha 7 de Diciembre de
2020. Ver Anexo 2.
6.2 A futuros representantes de tenedores de bonos
Mismo documento mencionado en el punto 6.1 precedente.
7.0 CONTRATO DE EMISION
7.1 Características generales

Contrato de Compraventa (“Purchase
Agreement”) celebrado el día 7 de

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Diciembre de 2020 entre (A) Corporación
Nacional del Cobre de Chile, como emisor
de los bonos, y (B) BofA Securities Inc.; J.P.
Morgan Securities LLC; Mizuho Securities
USA LLC y Scotia Capital (USA) Inc. como
Compradores Iniciales (Initial
Purchasers”). Ver Anexo 3.

El objeto del Purchase Agreement fue la
adquisición, por los Compradores Iniciales
(“Initial Purchasers”), de la totalidad de los
bonos emitidos por Corporación Nacional
del Cobre de Chile, bajo los términos y
condiciones que se expresan en dicho
contrato.

7.2 Derechos y obligaciones de los tenedores de bonos

Los bonos emitidos por Corporación Nacional del Cobre de Chile constituyen
obligaciones directas, no garantizadas y no subordinadas de la compañía
emisora. Los tenedores de bonos pueden declarar exigible anticipadamente
la totalidad del capital más intereses en ciertos casos de incumplimiento por
parte de Corporación Nacional del Cobre de Chile.

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8.0 OTROS ANTECEDENTES IMPORTANTES
Los bonos no han sido registrados en los Estados Unidos de América bajo la U.S.
Securities Act de 1933 y, por lo tanto, solamente podrán ser vendidos a ciertos
compradores institucionales calificados de acuerdo a lo dispuesto en la Rule 144 A de la
mencionada ley y/o fuera de los Estados Unidos de América, de acuerdo con lo señalado
en la Regulation S de la misma norma.

9.0 DECLARACION DE RESPONSABILIDAD

El suscrito, en su calidad de Presidente Ejecutivo de la Corporación Nacional del Cobre
de Chile (la “Sociedad”), ambos domiciliados en calle Huérfanos 1270, Santiago, a fin
de dar debido cumplimiento a lo dispuesto en la Circular N*1072 de la Superintendencia
de Valores y Seguros (hoy CMP), declara y da fe, bajo juramento, en este acto y bajo su
correspondiente responsabilidad legal, respecto de la plena y absoluta veracidad y
autenticidad de toda la información presentada y adjuntada por la Sociedad a la CMF en
el presente “Formulario de Hecho Esencial Colocación de Bonos en el Extranjero”, con
fecha 7 de Diciembre de 2020.

NOMBRE CARGO C.N.l. FIRMA
LA
Octavio Presidente 8088228-9 Mu _
Araneda Ejecutivo

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ANEXO 1

MEMORIA ANUAL

https://www.codelco.com/prontus_codelco/site/artic/20200328/asocfile/20200328104056/memori2019 codelco.pdf

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ANEXO 2

OFFERING MEMORANDUM

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ANEXO 3

PURCHASE AGREEMENT

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EXECUTION VERSION

CORPORACIÓN NACIONAL DEL COBRE DE CHILE

BofA Securities, Inc.
One Bryant Park
New York, New York 10036

and

J.P. Morgan Securities LLC
383 Madison Avenue
New York, New York 10179

and
Mizuho Securities USA LLC

1271 Avenue of the Americas
New York, New York 10020

and

Scotia Capital (USA) Inc.
250 Vesey Street
New York, New York 10281

U.S.$500,000,000
3.150% Notes Due 2051

Purchase Agreement

As Representatives of the Initial Purchasers

Ladies and Gentlemen:

New York, New York
December 7, 2020

Corporación Nacional del Cobre de Chile, a state-owned enterprise organized
under the laws of Chile (the “Company”), proposes to issue and sell to the several purchasers
named in SCHEDULE 1 hereto (the “Initial Purchasers”), for which you (the
“Representatives”) are acting as representatives, U.S.$500,000,000 principal amount of its
3.150% Notes Due 2051 (the “Securities”) to be issued pursuant to the indenture (the “Original
Indenture”), dated February 5, 2019, among the Company, The Bank of New York Mellon, as
trustee, paying agent, transfer agent and registrar (the “Trustee”), and The Bank of New York
Mellon (Luxembourg) S.A., as Luxembourg paying agent (the “Luxembourg Agent”), as
supplemented by the ninth supplemental indenture to be dated as of December 14, 2020, between
the Company and the Trustee (the “Ninth Supplemental Indenture” and, together with the
Original Indenture, the “Indenture”). Unless otherwise specified, defined terms used herein
shall have the meanings set forth in Section 21 hereof.

The sale of the Securities to the Initial Purchasers will be made without
registration of the Securities under the Act in reliance upon exemptions from the registration
requirements of the Act.

In connection with the sale of the Securities, the Company has prepared a
preliminary offering memorandum, dated December 7, 2020 (including any and all exhibits
thereto, the “Preliminary Memorandum”), and a final offering memorandum, dated December
7,2020 (as amended or supplemented at the Execution Time, including any and all exhibits
thereto, the “Final Memorandum”). For the purposes of this purchase agreement (this
“Agreement”), “Additional Written Offering Communication” means any written
communication (as defined in Rule 405 under the Act) that constitutes an offer to sell or a
solicitation of an offer to buy the Securities other than the Preliminary Memorandum or the Final
Memorandum, and “Time of Sale Memorandum” means the Preliminary Memorandum
together with the pricing term sheet prepared by the Company substantially in the form of
Exhibit B hereto and any Additional Written Offering Communications identified in
SCHEDULE II hereto. Each of the Preliminary Memorandum, the Time of Sale Memorandum
and the Final Memorandum sets forth certain information concerning the Company and the
Securities. The Company hereby confirms that it has authorized the use of the Preliminary
Memorandum, the Time of Sale Memorandum, the Final Memorandum and any Additional
Written Offering Communications identified in SCHEDULE II hereto, and any amendment or
supplement thereto, in connection with the offer and sale of the Securities by the Initial
Purchasers.

1. Representations and Warranties. The Company represents and warrants to each
Initial Purchaser as set forth below in this Section 1.

(a) The Time of Sale Memorandum, at the Execution Time, does not and, on
the Closing Date, will not contain any untrue statement of a material fact or omit to state
a material fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading. The Preliminary Memorandum, at the date
thereof, did not, and the Final Memorandum, at the date thereof, did not and, on the
Closing Date, will not (and any amendment or supplement thereto, at the date thereof,
and at the Closing Date, will not), contain any untrue statement of a material fact or omit
to state any material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, however, that the
Company makes no representation or warranty as to any information contained in the
Preliminary Memorandum, the Time of Sale Memorandum or the Final Memorandum, or
any amendment or supplement thereto, in reliance upon and in conformity with
information furnished in writing to the Company by or on behalf of the Initial Purchasers
through the Representatives specifically for inclusion therein, it being understood that the
only such information is set forth in Section 7(b) hereof.

(b) Except for the Additional Written Offering Communications, if any,
identified in SCHEDULE II hereto, and electronic road shows, if any, furnished to you
before first use, the Company has not prepared, used or referred to, and will not, without
your prior consent, prepare, use or refer to, any Additional Written Offering
Communication.

(c) Neither the Company, nor any of its Affiliates, nor any person acting on its
or their behalf has, directly or indirectly, made offers or sales of any “security” (as
defined in the Act), or solicited offers to buy or otherwise negotiated in respect of any
security, which is or will be integrated with the sale of the Securities in a manner that
would require the registration of the Securities under the Act.

(d) Neither the Company, nor any of its Affiliates, nor any person acting on its
or their behalf, has, directly or indirectly, offered or sold the Securities in Chile or to any
resident of Chile, except as permitted by applicable Chilean law.

(e) Neither the Company, nor any of its Affiliates, nor any person acting on its
or their behalf has, directly or indirectly, offered, solicited offers to buy or sell any of the
Securities by any form of general solicitation or general advertising (within the meaning
of Regulation D) or in any manner involving a public offering (within the meaning of
Section 4(a)(2) of the Act).

(f) The Securities satisfy the eligibility requirements of Rule 144A(d13) under
the Act.

(g) The Company is a “foreign issuer” (as defined in Regulation S), and neither
the Company, nor any of its Affiliates, nor any person acting on its or their behalf has
engaged in any “directed selling efforts” (as defined in Regulation S) with respect to the
Securities, except no such representation, warranty or agreement is made by the
Company with respect to the Initial Purchasers.

(h) Itis not necessary in connection with the offer, sale and delivery of the
Securities to the Initial Purchasers in the manner contemplated by this Agreement to
register the Securities under the Act or to qualify the Indenture under the Trust Indenture
Act.

(i) Each of the Company and its Affiliates, and any person acting on its or their
behalf, has complied with the offering restrictions requirement of Regulation S.

(¡) The Company is not, and after giving effect to the offering and sale of the
Securities and the application of the proceeds thereof as described in each of the Time of
Sale Memorandum and the Final Memorandum will not be, required to register as an
“investment company” within the meaning of the Investment Company Act.
(k) The Company has not paid or agreed to pay to any person any compensation
for soliciting another to purchase any securities of the Company (except as contemplated
by this Agreement).

(1) The Company has not taken, directly or indirectly, any action designed to
cause or result in, or that has constituted or which might reasonably be expected to
constitute or cause or result in, under the Exchange Act or otherwise, the stabilization or
manipulation of the price of any security of the Company to facilitate the sale or resale of
the Securities.

(m) Except as disclosed in each of the Time of Sale Memorandum and the Final
Memorandum, there are no transaction, stamp or other issuance or transfer taxes or duties
or other similar fees or withholdings or charges required to be paid in connection with the
execution and delivery of this Agreement, the Indenture, the issuance or sale by the
Company of the Securities or the enforcement of the Securities, other than (1) a 0.8%
stamp tax on the incurrence of the indebtedness evidenced by the Securities, which will
be paid by the Company upon the issuance of the Securities, and (11) a 4% withholding
tax on interest payments, and all other payments deemed to be interest payments, with
respect to the Securities to the extent paid to a person domiciled or residing outside of
Chile. Tf thin capitalization rules apply, as described in the Time of Sale Memorandum
and the Final Memorandum, such interest payments would be subject to a 35% penalty
tax that would be payable by the Company. The withholding tax applicable to the interest
payments made by the Company can be credited against such 35% penalty tax. Payments
of fees, compensations and reimbursement of costs contemplated in this Agreement or in
the Indenture, made to persons domiciled or residing outside of Chile are (or may be, in
the case of reimbursement of costs) subject to a withholding tax at a rate of up to 35%;
provided, however, that any such payment (A) is exempted from withholding tax if it is
deemed a “comisión mercantil” pursuant to the Commercial Code of Chile and the
interpretation of the Chilean Internal Revenue Service (Servicio de Impuestos Internos, or
the “SIP” or (B) subject to a 15% withholding tax if 1t is deemed payment for a
professional or technical assistance service, provided that the payment is not made to a
party organized, domiciled or resident in one of the countries which falls under the scope
of article 41H of the Chilean Income Tax Law. The withholding tax rate applicable to
payments of fees, compensation, services and reimbursement of costs to a person not
domiciled in, or resident of, Chile may be reduced or may be exempted if there is a
double taxation treaty in force between Chile and the country of such person”s residency
that contemplates a reduced or exempt regime applicable to such payments.

(n) Any information provided by the Company pursuant to Section 5(j) hereof
will not, at the date thereof, contain any untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.

(o) The Company has been duly created and is validly existing as a state-owned
enterprise under the laws of Chile with corporate power and authority to issue and sell the
Securities as contemplated hereby. Each of the Company”s subsidiaries has been duly
organized and is validly existing and in good standing under the laws of their respective
jurisdictions of organization and, together with the Company, have the corporate power
to own or lease, as the case may be, and to operate their properties and conduct their
business as described in the Time of Sale Memorandum and the Final Memorandum, and
are duly qualified to transact business in each jurisdiction which requires such
qualification, except to the extent that the failure to be so qualified to transact business
would not have a current or prospective material adverse effect on the condition
(financial or otherwise), earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions in the ordinary
course of business.

(p) The Company has no “significant subsidiary” as defined in Rule 1-02 of
Regulation S-X pursuant to the Act.

(q) This Agreement has been duly authorized, executed and delivered by the
Company; the Indenture has been duly authorized, executed and delivered by the
Company and, assuming due authorization, execution and delivery thereof by the Trustee,
constitutes a valid and binding instrument enforceable against the Company in
accordance with its terms (subject, as to the enforcement of remedies, to applicable
bankruptey, liquidation, reorganization, insolvency, moratorium or other laws affecting
creditors” rights generally and general principles of equity, including, without limitation,
concepts of materiality, reasonableness, good faith and fair dealing (regardless of whether
considered in a proceeding in equity or at law); and the Securities have been duly
authorized and, when executed and authenticated in accordance with the provisions of the
Indenture and delivered to and paid for by the Initial Purchasers under this Agreement,
will have been duly executed and delivered by the Company and will constitute valid and
binding obligations of the Company enforceable against the Company in accordance with
their terms and entitled to the benefits of the Indenture (subject, as to the enforcement of
remedies, to applicable bankruptcy, liquidation, reorganization, insolvency, moratorium
or other laws affecting creditors” rights generally and general principles of equity,
including, without limitation, concepts of materiality, reasonableness, good faith and fair
dealing (regardless of whether considered in a proceeding in equity or at law).

(r) The Securities and the Indenture will conform in all material respects to the
descriptions thereof in the Final Memorandum.

(s) No consent, approval, authorization, filing with or order of any court or
governmental agency or body is required in connection with the transactions
contemplated herein, in the Indenture or in the Securities, except (i) such as may be
required under the blue sky or securities laws of any jurisdiction in connection with the
purchase and distribution of the Securities by the Initial Purchasers in the manner
contemplated herein and in each of the Time of Sale Memorandum and the Final
Memorandum; and (ii) the following authorizations and registrations required by Chilean
law, which have been obtained and remain in full force and effect: (A) authorization
granted by the President of Chile and by Decree of the Minister of Finance, whether
general or specific, pursuant to Article 4 of Decree Law No. 2,349 of 1978 and pursuant
to Decree No. 1,009 issued by the Ministry of Finance, published in the Official Gazette
on December 23, 1978, as renewed by Decree No. 1,554 dated October 28, 2019 and
published in the Official Gazette on December 18, 2019; (B) authorization granted by the
Minister of Finance to the Company to enter into negotiations relating to the issue of the
Securities, pursuant to Decree Law No. 1,350 of 1976, as amended and pursuant to
Ordinary Resolution No. 2741 issued by the Ministry of Finance on November 26, 2020;
(C) authorization granted by the Minister of Finance to the Company to issue the
Securities, pursuant to Decree Law No. 1,350 of 1976, as amended and pursuant to
Ordinary Resolution No. 2796 issued by the Ministry of Finance on December 4, 2020;
and (D) the delivery to the Ministry of Finance and the Ministry of Mining for approval
and possible review of the proposed annual budget and a debt amortization budget
pursuant to Decree Law No. 1,350 of 1976, as amended.

(t) Neither the execution and delivery of the Indenture or this Agreement, the
issue and sale of the Securities, nor the consummation of any other of the transactions
herein or therein contemplated, nor the fulfillment of the terms hereof, thereof or of the
Securities has conflicted or will conflict with, or has resulted or will result in, a default,
breach or violation of or imposition of any lien, charge or encumbrance upon, any
property or assets of the Company or any of its subsidiaries (except, in the case of (1), (11)
or (iv) below, for any such conflict, default, breach, violation or imposition as would not
have a current or prospective material adverse effect on (x) the consummation of the
transactions contemplated hereby or the rights of the holders of the Securities or (y) the
condition (financial or otherwise), earnings, business or properties of the Company and
its subsidiaries, taken as a whole) pursuant to (i) any provision of applicable law; (ii)
Decree Law No. 1,350 of 1976, as amended from time to time, and the Company”s by-
laws, as restated in Decree No. 3 of January 13, 2012 and published in the Official
Gazette on July 4, 2012, or the Estatutos of the Company; (iii) the terms of any indenture,
contract, lease, mortgage, deed of trust, note agreement, loan agreement or other
agreement, obligation, condition, covenant or instrument to which the Company or any of
its subsidiaries is a party or bound or to which its respective property is subject; or (iv)
any statute, law, rule, regulation, judgment, order or decree applicable to the Company or
any of its subsidiaries of any court, regulatory body, administrative agency, governmental
body, arbitrator or other authority having jurisdiction over the Company, any of its
subsidiaries or their respective properties.

(u) The consolidated historical financial statements and schedules of the
Company and its consolidated subsidiaries included in each of the Time of Sale
Memorandum and the Final Memorandum present fairly in all material respects the
financial condition, results of operations and cash flows of the Company as of the dates
and for the periods indicated and have been prepared in conformity with International
Financial Reporting Standards as adopted by the International Accounting Standards
Board (“IERS”,) in respect of full year periods for 2017, 2018 and 2019 and interim
periods, in each case applied on a consistent basis throughout the periods involved
(except as otherwise noted therein); the selected financial data set forth under the
captions “Summary Consolidated Financial Data” and “Selected Consolidated Financial
Data” in each of the Time of Sale Memorandum and the Final Memorandum fairly
present, on the basis stated in each of the Time of Sale Memorandum and the Final
Memorandum, the information included therein and have been prepared in conformity
with IFRS in respect of full year periods for 2017, 2018 and 2019 and interim periods, in
each case applied on a consistent basis throughout the periods involved (except as
otherwise noted therein).

(v) There is no pending or threatened action, suit or proceeding by or before
any court or governmental agency, authority or body or any arbitrator involving the
Company or any of its subsidiaries or its or their property that is not described in each of
the Time of Sale Memorandum and the Final Memorandum (exclusive of any amendment
or supplement thereto), except for such proceedings that, if the subject of an unfavorable
decision, ruling or finding would not, singly or in the aggregate, have a current or
prospective material adverse effect (1) on the condition (financial or otherwise), earnings,
business or properties of the Company and its subsidiaries, taken as a whole, whether or
not arising from transactions in the ordinary course of business, or (ii) on the power or
ability of the Company to perform its obligations under this Agreement, the Indenture or
the Securities or to consummate the transactions contemplated in each of the Time of
Sale Memorandum and the Final Memorandum.

(w) No circumstance or other event has arisen that has caused or, with the
giving of notice or the lapse of time, or both, would cause the Company to be in violation
or default of: (i) any provision of Decree Law No. 1,350 of 1976, as amended, or its
Estatutos, (ii) the terms of any agreement or other instrument binding upon the Company
or any of its subsidiaries that is material to the Company and its subsidiaries, taken as a
whole; or (iii) any judgment, order or decree of any governmental body, agency or court
having jurisdiction over the Company or any subsidiary, except for such contraventions
as would not have a current or prospective material adverse effect on the Company or its
subsidiaries, taken as a whole.

(x) The Company and its subsidiaries possess all concessions, licenses,
certificates, permits and other authorizations issued by the appropriate government and
other regulatory authorities necessary to conduct their respective businesses, as described
in each of the Time of Sale Memorandum and the Final Memorandum, and neither the
Company nor any such subsidiary has received any notice of proceedings relating to the
revocation or modification of any such concession, certificate, authorization or permit
which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would have a current or prospective material adverse effect on the condition
(financial or otherwise), earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions in the ordinary
course of business.

(y) The Company and each of its subsidiaries maintain a system of internal
accounting controls sufficient to provide reasonable assurance that: (i) transactions are
executed in accordance with management’s general or specific authorizations; (ii)
transactions are recorded as necessary to permit preparation of financial statements in
conformity with IFRS and to maintain asset accountability; (111) access to assets is
permitted only in accordance with management’s general or specific authorization; and
(iv) the recorded accountability for assets is compared to existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.
(z) The Company and its subsidiaries have good and marketable title to all real
property owned by them and good title to all other properties owned by them, including
the Company”s mining concessions, mining rights and water rights, in each case, free and
clear of all mortgages, pledges, liens, security interests, claims, restrictions or
encumbrances of any kind except (i) such as are set forth in or contemplated by each of
the Time of Sale Memorandum and the Final Memorandum (exclusive of any amendment
or supplement thereto) or (1i) where the failure to have good title would not have a
current or prospective material adverse effect on the condition (financial or otherwise),
earnings business or properties of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of business; all of the
leases and subleases material to the business of the Company and its subsidiaries, taken
as a whole, and under which the Company or any of its subsidiaries holds properties
described in each of the Time of Sale Memorandum and the Final Memorandum, are in
full force and effect, except (i) where the failure to be in full force and effect would not
have a current or prospective material adverse effect on the condition (financial or
otherwise), earnings, business or properties of the Company and its subsidiaries, taken as
a whole, whether or not arising from transactions in the ordinary course of business, or
(ii) such as are set forth in or contemplated by each of the Time of Sale Memorandum
and the Final Memorandum (exclusive of any amendment or supplement thereto); and
none of the Company or its subsidiaries has any notice of any material claim of any sort
that has been asserted by anyone adverse to the rights of the Company or any of its
subsidiaries under any of the leases or subleases mentioned above, or affecting or
questioning the rights of the Company or any of its subsidiaries to the continued
possession of the leased or subleased premises under any such lease or sublease, except
(1) claims which are being contested by the Company or its subsidiaries in good faith and
which would not have a current or prospective material adverse effect on the condition
(financial or otherwise), earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions in the ordinary
course of business, or (ii) such as are set forth in or contemplated by each of the Time of
Sale Memorandum and the Final Memorandum (exclusive of any amendment or
supplement thereto).

(aa) Deloitte Auditores y Consultores Ltda., who have audited the full-year
2017, 2018 and 2019 financial statements of the Company included in each of the Time
of Sale Memorandum and the Final Memorandum and conducted a limited review of the
interim unaudited financial statements of the Company as of September 30, 2020 and for
the nine-month periods ended September 30, 2019 and 2020 included in each of the Time
of Sale Memorandum and the Final Memorandum, are an independent audit firm with
respect to the Company.

(bb) The Company and its subsidiaries (i) are in compliance with any and all
applicable laws, regulations and approvals relating to the protection of human health and
safety, the environment or hazardous or toxic substances or wastes, pollutants or
contaminants (“Environmental Laws”); (11) have received and are in compliance with all
permits, licenses or other approvals required of them under applicable Environmental
Laws to conduct their respective businesses; and (iii) have not received notice of any
actual or potential liability for the investigation or remediation of any disposal or release
of hazardous or toxic substances or wastes, pollutants or contaminants, except (x) where
such non-compliance with Environmental Laws, failure to receive required permits,
licenses or other approvals, or liability would not, individually or in the aggregate, have a
current or prospective material adverse effect on the condition (financial or otherwise),
earnings, business or properties of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of business, and (y) as
described in each of the Time of Sale Memorandum and the Final Memorandum
(exclusive of any amendment or supplement thereto).

(cc) In the ordinary course of its business, the Company periodically reviews the
effect of Environmental Laws on the business, operations and properties of the Company
and its subsidiaries, in the course of which it identifies and evaluates associated costs and
liabilities (including, without limitation, any capital or operating expenditures required
for clean-up, closure of properties or compliance with Environmental Laws, or any
permit, license or approval, any related constraints on operating activities and any
potential liabilities to third parties); on the basis of such review, the Company has
reasonably concluded that such associated costs and liabilities would not, singly or in the
aggregate, have a current or prospective material adverse effect on the condition
(financial or otherwise), earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions in the ordinary
course of business, except as set forth in or contemplated in each of the Time of Sale
Memorandum and the Final Memorandum (exclusive of any amendment or supplement
thereto).

(dd) Since the respective dates as of which information is given in each of the
Time of Sale Memorandum and the Final Memorandum, nothing has occurred giving rise
to a current or prospective material adverse change in the condition (financial or
otherwise), earnings, business or properties of the Company and its subsidiaries, taken as
a whole, whether or not arising from transactions in the ordinary course of business,
except as set forth in or contemplated in each of the Time of Sale Memorandum and the
Final Memorandum (exclusive of any amendment or supplement thereto).

(ee) Pursuant to Article 52 of the Organic Law of the Central Bank of Chile and
Decree Law No. 1,350 of 1976, as amended, the Company is exempt from the Central
Bank of Chile”s exchange regulations in connection with the issuance, placement and
payments upon the Securities. The Company is entitled to make payments under the
Securities with its own available foreign currency obtained from its export operations and
deposited with the Central Bank of Chile.

(ff) The Company has validly and irrevocably submitted to the non-exclusive
jurisdiction of any state or federal court located in the City of New York, New York, has
validly and irrevocably waived, to the extent permitted by law, any objection to the venue
of a proceeding in any such court and has validly and irrevocably appointed Cogency
Global Inc. in New York, New York as its authorized agent for service of process.

(gg) The Company has validly and irrevocably waived, pursuant to Section 17
hereof, and will have validly and irrevocably waived pursuant to the Indenture and the
Securities, for itself and its revenues and assets, to the extent permitted by applicable law,
any immunity from suit, jurisdiction, attachment in aid or execution of a judgment or
prior to a judgment, execution of a judgment or any other legal process with respect to its
obligations, respectively, under this Agreement, the Indenture and the Securities to which
it may be entitled or become entitled whether or not claimed, including sovereign
immunity, except that (i) for the attachment and judicial sale of mining concessions and
installations and other goods permanently dedicated to exploration or extraction of
minerals relating to such mining concessions, except with respect to mortgages, the
consent of the Company will be required and shall be given in the same judicial
proceeding in which the attachment and sale is sought (as set forth in article 226 of the
Mining Code of Chile); and (ii) pursuant to the Chilean Constitution, the mining
concessions corresponding to mining deposits exploited by the Company upon its
creation in 1976 cannot be subject to attachment nor to any act of disposition by the
Company. Each such waiver is binding under Chilean law and remains in full force and
effect.

(hh) The Company has an authorized capitalization as set forth in each of the
Time of Sale Memorandum and the Final Memorandum under the heading
“Capitalization”; and all the outstanding shares of capital stock or other equity interests
of each subsidiary of the Company have been duly and validly authorized and issued, are
fully paid and non-assessable and are owned directly or indirectly by the Company, free
and clear of any lien, charge, encumbrance, security interest, restriction on voting or
transfer or any other claim of any third party.

(ii) Neither the Company nor any of its subsidiaries nor, to the best knowledge
of the Company, any director, officer, agent, employee or other person associated with or
acting on behalf of the Company or any of its subsidiaries has: (i) used any corporate
funds for any unlawful contribution, gift, entertainment or other unlawful expense
relating to political activity; (1i) made any direct or indirect unlawful payment to any
foreign or domestic government official or employee from corporate funds; (iii) taken
any action, directly or indirectly, that violated or is in violation of any provision of any
applicable anti-bribery or anti-corruption law or regulation enacted in any jurisdiction,
including, without limitation, the Foreign Corrupt Practices Act of 1977, as amended, or
any applicable law or regulation implementing the OECD Convention on Combating
Bribery of Foreign Public Officials in International Business Transactions, or under the
Bribery Act of 2010 of the United Kingdom, or any other applicable anti-bribery or anti-
corruption laws; or (iv) made any unlawful bribe, influence payment, kickback or other
unlawful payment or gift of money or anything of value prohibited under any applicable
law or regulation in connection with the Company. The Company has instituted, and
maintains and enforces, policies and procedures designed to promote and achieve the
Company and its subsidiaries? compliance with all applicable anti-bribery and anti-
corruption laws.

(3j) The operations of the Company and its subsidiaries are and have been
conducted at all times in compliance with applicable financial recordkeeping and
reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970,
as amended, and applicable money laundering statutes of all jurisdictions, rules and

10
regulations thereunder and related or similar rules, regulations or guidelines, issued,
administered or enforced by any governmental agency (collectively, the “Money
Laundering Laws”) and no action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the Company or any
of its subsidiaries with respect to the Money Laundering Laws is pending or, to the best
knowledge of the Company, threatened or contemplated.

(kk) Neither the Company, any of its subsidiaries, nor any director or officer of
the Company or any of its subsidiaries, nor to the knowledge of the Company, any agent,
employee or affiliate (other than the Republic of Chile) of the Company or any of its
subsidiaries (1) is currently an individual or entity that is, or is owned or controlled or is
acting on behalf of, one or more individuals or entities (other than the Republic of Chile)
that are currently the subject of any sanctions administered or enforced by the United
States (including administered or enforced by the Office of Foreign Assets Control of the
U.S. Department of the Treasury (“OFAC”) or the U.S. Department of State), the
European Union, Her Majesty”s Treasury or the United Nations Security Council
(collectively, the “Sanctions”), (ii) organized, located or a resident in a country or
territory that is currently the subject of territorial Sanctions broadly prohibiting dealing
with such country or territory (each such country, a “Sanctioned Country,” currently the
Crimea region, Cuba, Iran, North Korea or Syria, and such persons, “Sanctioned
Persons” and each such person, a “Sanctioned Person”), or (iii) will, directly or
indirectly, use the proceeds of the offering of the Securities hereunder, or lend, contribute
or otherwise make available such proceeds to any subsidiary, joint venture partner or
other person or entity in any manner that would result in a violation of any Sanctions by,
or would reasonably be expected to result in the imposition of Sanctions against, any
individual or entity participating in the offering, whether as underwriter, advisor, investor
or otherwise. Neither the Company nor any of its subsidiaries has, to the knowledge of
the Company, engaged in any dealings or transactions with or for the benefit of a
Sanctioned Person, or with or in a Sanctioned Country, in the preceding 3 years, that have
resulted in a violation of Sanctions by, or the imposition of Sanctions against, the
Company or the Initial Purchasers, nor does the Company or any of its subsidiaries have
any plans to engage in dealings or transactions with or for the benefit of a Sanctioned
Person, or with or in a Sanctioned Country that would result in a violation of Sanctions
by, or the imposition of Sanctions against, the Company or the Initial Purchasers.

(1) No labor disturbance by or dispute with employees of the Company or any
of its subsidiaries exists or, to the best knowledge of the Company, is contemplated or
threatened, and the Company is not aware of any existing or imminent labor disturbance
by, or dispute with, the employees of any of the Company”s subsidiaries” principal
suppliers, contractors or customers, except (x) as would not have a material adverse
effect on the condition (financial or otherwise), earnings, business or properties of the
Company and its subsidiaries, taken as a whole, whether or not arising from transactions
in the ordinary course of business and (y) as set forth in or contemplated in each of the
Time of Sale Memorandum and the Final Memorandum (exclusive of any amendment or
supplement thereto).

11
(mm) The Company and its subsidiaries have insurance covering their respective
properties, operations, personnel and businesses, which insurance is in amounts and
insures against such losses and risks as are adequate to protect the Company and its
subsidiaries and their respective businesses, except where any failure to have such
insurance would not result in a material adverse effect on the condition (financial or
otherwise), earnings, business or properties of the Company and its subsidiaries, taken as
a whole, whether or not arising from transactions in the ordinary course of business; and
neither the Company nor any of its subsidiaries has (i) received notice from any insurer
or agent of such insurer that capital improvements or other expenditures are required or
necessary to be made in order to continue such insurance or (ii) any reason to believe that
it will not be able to renew its existing insurance coverage as and when such coverage
expires or to obtain similar coverage at reasonable cost from similar insurers as may be
necessary to continue its business at a cost that would not result in a material adverse
effect on the condition (financial or otherwise), earnings, business or properties of the
Company and its subsidiaries, taken as a whole, whether or not arising from transactions
in the ordinary course of business.

Any certificate signed by any officer of the Company and delivered to the
Representatives or counsel for the Initial Purchasers in connection with the offering of the
Securities shall be deemed a representation and warranty by the Company, as to matters covered
thereby, to each Initial Purchaser.

2. Purchase and Sale. (a) Subject to the terms and conditions and in reliance upon the
representations and warranties herein set forth, the Company agrees to sell to each Initial
Purchaser, and each Initial Purchaser agrees, severally and not jointly, to purchase from the
Company, at a purchase price of 99.429% of the principal amount of the Securities, plus accrued
interest, if any, from December 14, 2020 to the Closing Date (as defined below) (0.045% of the
principal amount of the Securities to be used by the Initial Purchasers out of the spread over the
offering price set forth in the Final Memorandum to pay for expenses payable by the Initial
Purchasers pursuant to Section 5(p) of this Agreement, with any remaining balance of such
0.045% to be refunded to the Company), the principal amount of Securities set forth opposite
such Initial Purchaser?s name in SCHEDULE lI hereto.

(b) The Company acknowledges and agrees that the Initial Purchasers are
acting solely in the capacity of an arm”s length contractual counterparty to the Company
with respect to the offering of Securities contemplated hereby (including in connection
with determining the terms of the offering) and not as a financial advisor or a fiduciary
to, or an agent of, the Company or any other person. Additionally, no Initial Purchaser is
advising the Company or any other person as to any legal, tax, investment, accounting or
regulatory matters in any jurisdiction. The Company shall consult with its own advisors
concerning such matters and shall be responsible for making its own independent
investigation and appraisal of the transactions contemplated hereby, and the Initial
Purchasers shall have no responsibility or liability to the Company with respect thereto.
Any review by the Initial Purchasers of the Company, the transactions contemplated
hereby or other matters relating to such transactions will be performed solely for the
benefit of the Initial Purchasers and shall not be on behalf of the Company.

12
3. Delivery and Payment. Delivery of and payment for the Securities shall be made at
10:00 A.M., New York City time, on December 14, 2020 or at such time on such later date as the
Representatives shall designate, which date and time may be postponed by agreement between
the Representatives and the Company or as provided in Section 8 hereof (such date and time of
delivery and payment for the Securities, including as so postponed, being herein called the
“Closing Date”). Delivery of the Securities shall be made to the Representatives for the
respective accounts of the several Initial Purchasers against payment by the several Initial
Purchasers through the Representatives of the purchase price thereof to or upon the order of the
Company by wire transfer payable in same-day funds to the account specified by the Company.
Delivery of the Securities shall be made through the facilities of The Depository Trust Company
(“DTC”) unless the Representatives shall otherwise instruct.

4. Offering by the Initial Purchasers. Each Initial Purchaser, severally and not jointly,
represents and warrants to and agrees with the Company that:

(a) It has not offered or sold, and will not offer or sell, any Securities except
(i) to persons it reasonably believes to be qualified institutional buyers (as defined in Rule
144A under the Act) and that, in connection with each such sale, it has taken or will take
reasonable steps to ensure that the purchaser of such Securities is aware that such sale is
being made in reliance on Rule 144A; or (ii) in accordance with the restrictions set forth
in Exhibit A hereto.

(b) Neither it nor any person acting on its behalf has made or will make offers
or sales of the Securities in the United States by means of any form of general solicitation
or general advertising (within the meaning of Regulation D) in the United States or in any
manner involving a public offering within the meaning of Section 4(a)(2) of the Act.

(c) Unless it has obtained or will obtain the prior written consent of the
Company, it has not used, and will not use, or authorize use of, any written
communication that constitutes an offer to sell or the solicitation of an offer to buy the
Securities other than: (i) the Preliminary Memorandum, (ii) the Time of Sale
Memorandum, (iii) the Final Memorandum; (iv) any Additional Written Offering
Communications identified in SCHEDULE II hereto; and (v) any Bloomberg or other
customary electronic communications providing certain ratings or proposed terms of the
Securities or relating to marketing, administrative or procedural matters in connection
with the offering of the Securities.

5. Covenants of the Company. The Company agrees with each Initial Purchaser that:

(a) The Company will furnish to each Initial Purchaser and to counsel for the
Initial Purchasers, without charge, during the period referred to in paragraph (d) below,
electronic copies of the materials contained in the Time of Sale Memorandum, the Final
Memorandum and any amendments and supplements thereto as they may reasonably
request.

(b) Before amending or supplementing the Preliminary Memorandum, the Time
of Sale Memorandum or the Final Memorandum, the Company will furnish to the Initial

13
Purchasers a copy of each such proposed amendment or supplement and will not use any
such proposed amendment or supplement to which the Initial Purchasers reasonably
object.

(c) The Company will furnish to each Initial Purchaser a copy of each proposed
Additional Written Offering Communication to be prepared by or on behalf of, used by,
or referred to by the Company and agrees not to use or refer to any proposed Additional
Written Offering Communication to which the Initial Purchasers reasonably object.

(d) If at any time prior to the completion of the sale of the Securities by the
Initial Purchasers (as determined by the Representatives), any event occurs as a result of
which the Time of Sale Memorandum or the Final Memorandum, as then amended or
supplemented, would include any untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading, or if it should be necessary to amend or
supplement the Time of Sale Memorandum or the Final Memorandum to comply with
applicable law, the Company promptly: (i) will notify the Representatives of any such
event; (ii) subject to the requirements of paragraph (b) of this Section 5, will prepare an
amendment or supplement that will correct such statement or omission or effect such
compliance; and (iii) will supply any supplemented or amended Time of Sale
Memorandum or the Final Memorandum to the several Initial Purchasers and counsel for
the Initial Purchasers without charge in such quantities as they may reasonably request.

(e) The Company will arrange, if necessary, for the qualification of the
Securities for sale by the Initial Purchasers under the laws of such jurisdictions as the
Initial Purchasers may reasonably designate and will maintain such qualifications in
effect so long as required for the sale of the Securities; provided that in no event shall the
Company be obligated to qualify to do business in any jurisdiction where it is not now so
qualified or to take any action that would subject it to service of process in suits, other
than those arising out of the offering or sale of the Securities, in any jurisdiction where it
is not now so subject. The Company will promptly advise the Representatives of the
receipt by the Company of any notification with respect to the suspension of the
qualification of the Securities for sale in any jurisdiction or the initiation or threatening of
any proceeding for such purpose.

(1) During the period of one year after the Closing Date, the Company will not
resell, and will not permit any person that is an affiliate (as defined in Rule 144 under the
Act) at the time of any contemplated resale or that has been an affiliate within the three
months preceding such time to resell, any of the Securities that have been reacquired by
any of them, except for Securities purchased by the Company or any of its affiliates and
resold in a transaction registered under the Act or in reliance of Regulation S.

(2) Neither the Company, nor any of its Affiliates, nor any person acting on its
or their behalf will, directly or indirectly, make offers or sales of any security, or solicit
offers to buy any security, under circumstances that would require the registration of the
Securities under the Act.

14
(h) Neither the Company, nor any of its Affiliates, nor any person acting on its
or their behalf will, directly or indirectly, make offers or sales of the Securities in Chile or
to any resident of Chile, except as permitted by applicable Chilean law.

(i) Neither the Company, nor any of its Affiliates, nor any person acting on its
or their behalf will engage in any form of general solicitation or general advertising
(within the meaning of Regulation D) in connection with any offer or sale of the
Securities in the United States or in any manner involving a public offering within the
meaning of Section 4(a)(2) of the Act.

(1) Solong as any of the Securities are “restricted securities” within the
meaning of Rule 144(a)(3) under the Act, the Company will, unless it becomes subject to
and complies with Section 13 or 15(d) of the Exchange Act, or becomes exempt from
such reporting requirements pursuant to, and complies with, Rule 12g3-2(b) under the
Exchange Act, provide to each holder of such restricted securities and to each prospective
purchaser (as designated by such holder) of such restricted securities, upon the request of
such holder or prospective purchaser, any information required to be provided by Rule
144A(d)(4) under the Act. This covenant is intended to be for the benefit of the holders,
and the prospective purchasers designated by such holders, from time to time of such
restricted securities.

(k) Neither the Company, nor any of its Affiliates, nor any person acting on its
or their behalf will engage in any directed selling efforts (as defined in Regulation S)
with respect to the Securities.

(1) The Company will cooperate with the Representatives and use its best
efforts to permit the Securities to be eligible for clearance and settlement through DTC,
including its indirect participants, Euroclear Bank S.A./N.V. (“Euroclear”) and
Clearstream Banking, S.A., Luxembourg (““Clearstream”).

(m) The Company will use its best efforts to effect the listing of the Securities
on the Euro MTF market of the Luxembourg Stock Exchange and for so long as the
Securities are outstanding, will file with the Euro MTF market of the Luxembourg Stock
Exchange and any other governmental agency, authority or instrumentality in
Luxembourg as may be required, such reports, documents, agreements and other
information which may, from time to time, be required to be so filed; provided that the
Company may, in its reasonable discretion, de-list the Securities in the event that any
European or national legislation becomes effective in Luxembourg in a manner that
would require the Company to publish or produce financial statements according to
accounting principles or standards that are different from IFRS or that would otherwise
impose requirements that the Company determines, in its reasonable discretion, are not
reasonable.

(n) The Company will not for a period of 30 days following the Execution
Time, without the prior written consent of the Representatives, offer, sell or contract to
sell, or otherwise dispose of (or enter into any transaction which is designed to, or might
reasonably be expected to, result in the disposition (whether by actual disposition or

15
effective economic disposition due to cash settlement or otherwise) by the Company or
any Affiliate of the Company or any person in privity with the Company or any Affiliate
of the Company), directly or indirectly, or announce any public or broadly marketed
offering of, any U.S. dollar-denominated debt securities issued or guaranteed by the
Company in the international capital markets (other than the Securities).

(o) The Company will not take, directly or indirectly, any action designed to
cause or result in, or that has constituted or which might reasonably be expected to
constitute or cause or result in, under the Exchange Act or otherwise, the stabilization or
manipulation of the price of any security of the Company to facilitate the sale or resale of
the Securities.

(p) The Company agrees either to pay directly or to reimburse the Initial
Purchasers, as the case may be, for the reasonable and documented expenses relating to
the following matters: (i) the issuance of the Securities and the fees and expenses of the
Trustee (including, without limitation, the fees of counsel for such trustee); (ii) the
preparation, printing and reproduction of each of the Preliminary Memorandum and Final
Memorandum and each amendment or supplement to either of them, including the
pricing term sheet prepared by the Company and any Additional Written Offering
Communications identified in SCHEDULE IT hereto; (iii) the printing (and reproduction)
and delivery (including postage, air freight charges and charges for counting and
packaging) of such copies of each of the Preliminary Memorandum and Final
Memorandum, and all amendments or supplements to either of them, as may, in each
case, be reasonably requested for use in connection with the offering and sale of the
Securities; (iv) the preparation, printing, authentication, issuance and delivery of
certificates for the Securities, including any stamp or transfer taxes in connection with the
original issuance and sale of the Securities; (v) the printing (and reproduction) and
delivery of this Agreement, any blue sky memorandum and all other agreements or
documents printed (or reproduced) and delivered in connection with the offering of the
Securities; (vi) any registration or qualification of the Securities for offer and sale under
the securities or blue sky laws of the several states (including filing fees and the
reasonable fees and expenses of counsel for the Initial Purchasers relating to such
registration and qualification); (vii) the listing of the Securities with the Euro MTF
market of the Luxembourg Stock Exchange (including the fees of the agent retained in
connection with such listing); (viii) the approval of the Securities for book-entry transfer
by DTC, Euroclear and Clearstream,; (ix) the rating of the Securities by rating agencies;
(x) the expenses incurred by the Company or the Initial Purchasers in connection with
presentations to prospective purchasers of the Securities; (xi) the fees and expenses of the
Company”s accountants; (xii) the fees and expenses of counsel (including local and
special United States and Chilean counsels) for the Company; (xiii) all other reasonable
and documented expenses incurred by the Initial Purchasers in connection with the
offering and sale of the Securities; and (xiv) all other fees and expenses incident to the
performance by the Company and the Initial Purchasers of their obligations hereunder;
provided that, if the offering of the Securities (A) is not completed within twelve months
because any condition to the obligations of the Initial Purchasers set forth in Section 6
hereof is not satisfied, because of any termination pursuant to Section 9 hereof or because
of any refusal, inability or failure on the part of the Company to perform any agreement

16
herein or comply with any provision hereof other than by reason of a default by any of
the Initial Purchasers, the Company shall pay directly all costs and expenses
contemplated by this Section 5(p) or, to the extent the Initial Purchasers have borne such
costs and expenses, shall reimburse the Initial Purchasers severally through the
Representatives; and (B) is completed, the Initial Purchasers shall pay for all such costs
and expenses of this Section S(p) pro rata in proportion to each Initial Purchaser”s
commitment to purchase Securities as listed in SCHEDULE TI hereto in accordance with
Section 2(a) and this Section 5(p) (except for the costs and expenses contemplated by
SP)Gx), S(p)xiyand S(p)(xii), which shall be paid directly by the Company whether or
not the offering of the Securities is completed), and the Company shall cover such costs
and expenses of this Section S(p) pursuant to Section 2(a).

(q) The Company will apply the net proceeds from the sale of the Securities
substantially in accordance with the description set forth under the heading “Use of
Proceeds” in each of the Time of Sale Memorandum and the Final Memorandum.

(r) The Company will not take any action or omit to take any action (such as
issuing any press release relating to any Securities without an appropriate legend) which
may result in the loss by any of the Initial Purchasers of the ability to rely on any
stabilization safe harbor provided by the Financial Conduct Authority under the U.K.
Financial Services and Markets Act 2000 (the “FSMA”).

6. Conditions to the Obligations of the Initial Purchasers. The obligations of the
Initial Purchasers to purchase the Securities on the Closing Date shall be subject to the accuracy
of the representations and warranties of the Company contained herein at the Execution Time
and the Closing Date, to the accuracy of the statements of the Company made in any certificates
pursuant to the provisions hereof, to the performance by the Company of its obligations
hereunder and to the following additional conditions:

(a) The Company shall have requested and caused Cleary Gottlieb Steen 82
Hamilton LLP, U.S. counsel for the Company, to furnish to the Representatives its
opinion, dated the Closing Date and addressed to the Representatives, substantially to the
effect that:

(i) the Indenture has been duly executed and delivered by the Company
under the laws of the State of New York and is a valid, binding and enforceable
agreement of the Company; the Securities, when delivered to and paid for by the
Initial Purchasers in accordance with this Agreement, will be the valid, binding
and enforceable obligations of the Company, entitled to the benefits of the
Indenture pursuant to which such Securities are to be issued; the statements set
forth under the headings “Description of Notes” and “Transfer Restrictions” in the
Time of Sale Memorandum and the Final Memorandum, insofar as such
statements purport to summarize certain provisions of the Securities and the
Indenture, provide a fair summary of such provisions; and the statements in Final
Memorandum under the heading “Plan of Distribution,” insofar as such
statements purport to summarize certain provisions of this Agreement, provide a
fair summary of such provisions;

17
(ii) this Agreement has been duly executed and delivered by the
Company under the law of the State of New York;

(111) the statements made in each of the Time of Sale Memorandum and
the Final Memorandum under the heading “Taxation—United States Taxation”,
insofar as such statements purport to summarize certain federal income tax laws
of the United States, constitute a fair summary of the principal U.S. federal
income tax consequences of an investment in the Securities by a U.S. Holder (as
defined in each of the Time of Sale Memorandum and the Final Memorandum);

(iv) the issuance and the sale of the Securities to the Initial Purchasers
pursuant to this Agreement and the execution and delivery of this Agreement and
the Indenture do not, and the performance by the Company of its obligations
under this Agreement, the Indenture and the Securities will not, (A) require any
consent, approval, authorization, registration or qualification of or with any
governmental authority of the United States or the State of New York that in such
counsel”s experience normally would be applicable to general business entities
with respect to such issuance, sale or performance (but such counsel need express
no opinion relating to United States federal securities laws or any state securities
or blue sky laws other than as set forth in (v) below); or (B) result in a violation of
any United States federal or New York State law or published rule or regulation
that in such counsel”s experience normally would be applicable to general
business entities with respect to such issuance, sale or performance (but such
counsel need not express any opinion relating to the United States federal
securities laws or any state securities or blue sky laws, except as set forth in (v)
below) or (based solely on inquiry of the General Counsel and Head of Finance of
the Company) any judgment, decree or order applicable to the Company of any
New York state or federal court or other governmental authority;

(v) noregistration of the Securities under the Act, and no qualification
of the Indenture under the Trust Indenture Act, are required for the offer and sale
of the Securities by the Company to the Initial Purchasers pursuant to and in the
manner contemplated by this Agreement or by the Initial Purchasers as
contemplated by this Agreement, the Time of Sale Memorandum and the Final
Memorandum;

(vi) no registration of the Company under the Investment Company Act
is required for the offer and sale of the Securities by the Company in the manner
contemplated herein and by each of the Time of Sale Memorandum and the Final
Memorandum; and

(vii) under the laws of the State of New York relating to submission to
jurisdiction, the Company, pursuant to Section 14 of this Agreement, Section 1.12
of the Indenture and the provisions of the Securities, has (a) validly and
irrevocably submitted to the non-exclusive personal jurisdiction of any New York
state or U.S. federal court located in the Borough of Manhattan, the City of New
York, in any action arising out of or related to this Agreement that is brought by

18
an Initial Purchaser or by any person who controls any Initial Purchaser, or in any
action arising out of or related to the Indenture or the Securities that is brought by
the holder of any Securities; (b) to the fullest extent permitted by law, validly and
irrevocably waived any objection to the venue of a proceeding in any such court
and (c) validly appointed Cogency Global Inc., as its authorized representative in
the United States, and as its authorized agent for the purpose described in Section
14 hereof, the Indenture and the Securities; and service of process upon such
agent in a manner permitted by applicable law will be effective to confer valid
personal jurisdiction over the Company in any action arising under this
Agreement, the Indenture or the Securities.

(b) The Company shall have requested and caused Cleary Gottlieb Steen $2
Hamilton LLP, U.S. counsel for the Company, to furnish to the Representatives its letter,
dated the Closing Date and addressed to the Representatives, substantially to the effect
that no information has come to such counsel’s attention that causes it to believe that:

(i) the Time of Sale Memorandum (except the financial statements and
schedules and other financial and statistical data included therein, the information
therein relating to the Company”s ore reserves, as to which such counsel
expresses no view), as of the Execution Time, contained any untrue statement of a
material fact or omitted to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were made,
not misleading, and

(ii) the Final Memorandum (except the financial statements and
schedules and other financial and statistical data included therein, the information
therein relating to the Company”s ore reserves, as to which such counsel
expresses no view), as of the Closing Date and the Execution Time, contained or
contains an untrue statement of a material fact or omitted or omits to state a
material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.

In rendering its opinion under Section 6(a) hereof and furnishing its letter under
Section 6(b) hereof, such counsel may rely (A) as to matters involving the application of laws of
any jurisdiction other than the State of New York or federal laws of the United States, to the
extent they deem proper and specified in such opinion, upon the opinion of other counsel of good
standing whom they believe to be reliable and who are satisfactory to counsel for the Initial
Purchasers; and (B) as to matters of fact, to the extent they deem proper, on certificates of
responsible officers of the Company and public officials. References to the Final Memorandum
in Section 6(a) and Section 6(b) include any amendment or supplement thereto at the Closing
Date.

(c) The Company shall have requested and caused Carey y Cía. Ltda., Chilean
counsel for the Company, to furnish to the Representatives its opinion, dated the Closing
Date and addressed to the Representatives, substantially to the effect that:

(i) the Company has been duly created and is validly existing as a state-
owned company under the laws of Chile, with full corporate power and authority

19
to own or lease, as the case may be, and to operate its properties, exercise its
mining concessions, mining rights and water rights, and conduct its business as
described in each of the Time of Sale Memorandum and the Final Memorandum,
and is duly qualified to do business under the laws of each jurisdiction which
requires such qualification;

(ii) the Indenture has been duly authorized, executed and delivered, and
constitutes a legal, valid and binding instrument enforceable against the Company
in accordance with its terms (subject, as to the enforcement of remedies, to
applicable bankruptcy, liquidation, reorganization, insolvency, moratorium or
other laws affecting creditors” rights generally and general principles of equity,
including, without limitation, concepts of materiality, reasonableness, good faith
and fair dealing (regardless of whether considered in a proceeding in equity or at
law); and the Securities have been duly and validly authorized and, when
executed and authenticated in accordance with the provisions of the Indenture and
delivered to and paid for by the Initial Purchasers under this Agreement, will have
been duly executed and delivered by the Company and will constitute legal, valid,
binding and enforceable obligations of the Company entitled to the benefits of the
Indenture (subject, as to the enforcement of remedies, to applicable bankruptcy,
liquidation, reorganization, insolvency, moratorium or other laws affecting
creditors” rights generally and general principles of equity, including, without
limitation, concepts of materiality, reasonableness, good faith and fair dealing
(regardless of whether considered in a proceeding in equity or at law);

(111) the statements in each of the Time of Sale Memorandum and the
Final Memorandum under the captions “Presentation of Financial and Statistical
Information”, “Enforceability of Civil Liabilities”, “Exchange Rates”, “Risk
Factors—Risks Relating to CODELCO”s Operations—CODELCO”s compliance
with environmental, health and safety laws may require increased costs, including
capital commitments, and non-compliance may subject it to significant penalties”,
“Risk Factors—Risks Relating to CODELCO”s Operations —Future compliance
with a changing and complex regulation scheme may require changes in
CODELCOS*s business”, “Risk Factors—Risks Relating to CODELCO”s
Operations—Labor disruptions involving CODELCO”s employees or the
employees of its independent contractors could affect CODELCO”s production
levels and costs”, “Risk Factors—Risks Relating to CODELCO”s Operations—
CODELCO is subject to an extensive labor reform law promulgated by the
Government of Chile that could affect its business and operating results in the
future”, “Risk Factors—Risks Relating to CODELCO”s Relationship with the
Government of Chile”, “Management’s Discussion and Analysis of Financial
Condition and Results of Operations—Results of Operations for the Nine Months
Ended September 30, 2019 and 2020—Other expenses”, “Management’s
Discussion and Analysis of Financial Condition and Results of Operations—
Results of Operations for the Nine Months Ended September 30, 2019 and
2020 —Foreign exchange differences”, “Management’s Discussion and Analysis
of Financial Condition and Results of Operations—Results of Operations for the
Nine Months Ended September 30, 2019 and 2020—Income tax expense”,

20
“Management”s Discussion and Analysis of Financial Condition and Results of
Operations—Results of Operations for the Three Years Ended December 31,
2019—Other expenses”, “Management’s Discussion and Analysis of Financial
Condition and Results of Operations—Results of Operations for the Three Years
Ended December 31, 2019 —Income tax expense”, “Management’s Discussion
and Analysis of Financial Condition and Results of Operations—Liquidity and
Capital Resources—Distributions to the Chilean Treasury”, “Regulatory
Framework”, “Management”, “Related Party Transactions”, “Foreign Investment
and Exchange Controls in Chile” and “Taxation—Chilean Taxation”, insofar as
such statements constitute summaries of Chilean legal matters, documents or
proceedings referred to therein, fairly summarize the matters therein;

(iv) such counsel has no reason to believe that (A) at the Execution
Time, the Time of Sale Memorandum contained any untrue statement of a
material fact or omitted to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were made,
not misleading or (B) at the Execution Time and on the Closing Date, the Final
Memorandum contained or contains any untrue statement of a material fact or
omitted or omits to state any material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading (in each case, other than the financial statements and other financial
information contained therein, as to which such counsel need express no opinion);

(v) this Agreement has been duly authorized, executed and delivered by
the Company;

(vi) the Company has all requisite corporate power and authority, has
taken all requisite corporate action and has received and is in compliance with all
governmental, judicial and other authorizations, approvals and orders necessary to
enter into and perform its obligations under this Agreement and the Indenture and
to issue and perform its obligations under the Securities, and no consent,
approval, authorization, filing with or order of any Chilean court or governmental
agency or body is required in connection with the transactions contemplated
herein, in the Indenture or in the Securities, except (i) such as may be required
under the blue sky or securities laws of any jurisdiction in connection with the
purchase and sale of the Securities by the Initial Purchasers in the manner
contemplated in this Agreement, the Time of Sale Memorandum and the Final
Memorandum, and (ii) the following authorizations and registrations required by
Chilean law, which have been obtained and remain in full force and effect:

(A) authorization granted by the President of Chile and by Decree of the Minister
of Finance, whether general or specific, pursuant to Article 4 of Decree Law

No. 2,349 of 1978 and pursuant to Decree No. 1,009 issued by the Ministry of
Finance, published in the Official Gazette on December 23, 1978, as renewed by
Decree No. 1,554 dated October 28, 2019 and published in the Official Gazette on
December 18, 2019; (B) authorization granted by the Minister of Finance to the
Company to enter into negotiations relating to the issue of the Securities, pursuant
to Decree Law No. 1,350 of 1976, as amended and pursuant to Ordinary

21
Resolution No. 2741 issued by the Ministry of Finance on November 26, 2020;
(C) authorization granted by the Minister of Finance to the Company to issue the
Securities, pursuant to Decree Law No. 1,350 of 1976, as amended and pursuant
to Ordinary Resolution No. 2796 issued by the Ministry of Finance on December
4, 2020; and (D) the delivery to the Ministry of Finance and the Ministry of
Mining for approval and possible review of the proposed annual budget and a
debt amortization budget pursuant to Decree Law No. 1,350 of 1976, as amended;

(vii) neither the execution and delivery of the Indenture or this
Agreement, the issue and sale of the Securities, nor the consummation of any
other of the transactions herein or therein contemplated, nor the fulfillment of the
terms hereof, thereof or of the Securities will conflict with, or result in, a default,
breach or violation of, or imposition of any lien, charge or encumbrance upon any
property or asset of the Company or its subsidiaries pursuant to, (i) any provision
of applicable Chilean law; (11) Decree Law No. 1,350 of 1976, as amended from
time to time, and the Company”s by-laws, as restated in Decree No. 3 of January
13, 2012 and published in the Official Gazette on July 4, 2012, or the Estatutos of
the Company; or (iii) any statute, law, rule, regulation, judgment, order or decree
applicable to the Company or any of its subsidiaries of any Chilean court,
regulatory body, administrative agency, governmental body, arbitrator or other
authority having jurisdiction over the Company, any of its subsidiaries or any of
their respective properties;

(viii) pursuant to Article 52 of the Organic Law of the Central Bank of
Chile and Decree Law No. 1,350 of 1976, as amended, the Company is exempt
from the Central Bank of Chile”s regulations in connection with the issuance,
placement and payments upon the Securities. The Company is entitled to make
payments under the Securities with its own available foreign currency obtained
from its export operations and deposited with the Central Bank of Chile;

(ix) except as disclosed in each of the Time of Sale Memorandum and
the Final Memorandunm, there are no transaction, stamp or other issuance or
transfer taxes or duties or other similar fees or withholdings or charges required to
be paid in connection with the execution and delivery of this Agreement, the
Indenture, the issuance or sale by the Company of the Securities or the
enforcement of the Securities, other than (1) a 0.8% stamp tax on the incurrence of
the indebtedness evidenced by the Securities, which will be paid by the Company
upon the issuance of the Securities, and (ii) a 4% withholding tax on interest
payments, and all other payments deemed to be interest payments, with respect to
the Securities to the extent paid to a person domiciled or residing outside of Chile.
Tf thin capitalization rules apply, as described in the Time of Sale Memorandum
and the Final Memorandum, such interest payments would be subject to a 35%
penalty tax that would be payable by the Company. The withholding tax
applicable to the interest payments made by the Company can be credited against
such 35% penalty tax. Payments of fees, compensations and reimbursement of
costs contemplated in this Agreement or in the Indenture, made to persons
domiciled or residing outside of Chile are (or may be, in the case of

22
reimbursement of costs) subject to a withholding tax at a rate of up to 35%;
provided, however, that any such payment (A) is exempted from withholding tax
if 1t is deemed a “comisión mercantil” pursuant to the Commercial Code of Chile
and the interpretation of the Chilean Internal Revenue Service (Servicio de
Impuestos Internos, or the “SIT”) or (B) subject to a 15% withholding tax if it is
deemed payment for a professional or technical assistance service, provided that
the payment is not made to a party organized, domiciled or resident in one of the
countries which falls under the scope of article 41H of the Chilean Income Tax
Law. The withholding tax rate applicable to payments of fees, compensation,
services and reimbursement of costs to a person not domiciled in, or resident of,
Chile may be reduced or may be exempted if there is a double taxation treaty in
force between Chile and the country of such person’s residency that contemplates
a reduced or exempt regime applicable to such payments;

(x) none of the holders of the Securities, the Initial Purchasers or the
Trustee will be deemed resident, domiciled, carrying on business or subject to any
tax liability in Chile solely by reason of the holding of the Securities or the
execution, delivery, performance or enforcement of this Agreement, the Indenture
or the Securities, assuming that none of such persons is domiciled or is a resident
of Chile or has a permanent establishment in Chile;

(xi) the choice of law provisions set forth in Section 15 hereof, in the
Indenture and in the Securities are legal, valid and binding under the laws of Chile
and such counsel knows of no reason why the courts of Chile would not give
effect to the choice of New York law as the proper law of this Agreement, of the
Indenture and of the Securities; the Company has the legal capacity to sue and be
sued in its own name under the laws of Chile; the Company has been empowered
by Decree No. 1,009 issued by the Ministry of Finance, published in the Official
Gazette on December 23, 1978, as renewed by Decree No. 1,554 dated October
28, 2019 and published in the Official Gazette on December 18, 2019, to submit,
and has irrevocably submitted, to the non-exclusive jurisdiction of the New York
courts and has validly and irrevocably appointed Cogency Global Inc. as its
authorized agent for the purpose described in Section 14 hereof, in the Indenture
and in the Securities under the laws of Chile; the irrevocable submission of the
Company to the non-exclusive jurisdiction of the New York courts and the
waivers by the Company of any objection to the venue of the proceeding in a New
York court herein, in the Indenture and in the Securities are legal, valid and
binding under the laws of Chile and such counsel knows of no reason why the
courts of Chile would not give effect to such submission and waivers; service of
process in the manner set forth in Section 14 hereof, in the Indenture and in the
Securities will be effective to confer valid personal jurisdiction over the Company
under the laws of Chile; and the courts in Chile will recognize as valid and final,
and will enforce, any final and conclusive judgment against the Company
obtained in a New York court arising out of or in relation to the obligations of the
Company under this Agreement, the Indenture or the Securities, subject only to
the conditions and qualifications described in each of the Time of Sale

23
Memorandum and the Final Memorandum under the caption “Enforceability of
Civil Liabilities”;

(xii) the Company has validly and irrevocably waived, pursuant to
Section 17 hereof and to the provisions of the Indenture and the Securities for
itself and its revenues and assets, to the full extent permitted by Chilean law, any
immunity from suit, jurisdiction, attachment in aid or execution of a judgment or
prior to a judgment, execution of a judgment or any other legal process with
respect to its obligations, respectively, under this Agreement, the Indenture and
the Securities to which it may be entitled or become entitled whether or not
claimed, including sovereign immunity, except that (1) for the attachment and
judicial sale of mining concessions and installations and other goods permanently
dedicated to exploration or extraction of minerals relating to such mining
concessions, except with respect to mortgages, the consent of the Company will
be required and shall be given in the same judicial proceeding in which the
attachment and sale is sought (as set forth in article 226 of the Mining Code of
Chile); and (ii) pursuant to the Chilean Constitution, the mining concessions
corresponding to mining deposits exploited by the Company upon its creation in
1976 cannot be subject to attachment nor to any act of disposition by the
Company. Each such waiver is binding under Chilean law and remains in full
force and effect; and

(xiii) this Agreement, the Indenture and the Securities are in proper legal
form under the laws of Chile for the enforcement thereof against the Company in
Chile without the need to obtain any other consent, approval or authorization, to
file any notification or to take any further action on the part of the Initial
Purchasers or the Trustee and to ensure the legality, validity, enforceability or
admissibility in evidence of any of this Agreement, the Indenture and the
Securities, and except for their translation into Spanish for their presentation to a
Chilean court and subject to the payment of the applicable stamp tax, if any (and
applicable readjustments and penalties, if any), it is not necessary that any other
document be filed or recorded with any court or other authority in Chile or that
any stamp or similar tax be paid on or in respect of any such document or the
Securities.

In rendering such opinion, such counsel may rely (A) as to matters involving the
application of laws of any jurisdiction other than Chile, to the extent they deem proper and
specified in such opinion, upon the opinion of other counsel of good standing whom they believe
to be reliable and who are satisfactory to counsel for the Initial Purchasers; and (B) as to matters
of fact, to the extent they deem proper, on certificates of responsible officers of the Company and
public officials. References to the Final Memorandum in this Section 6(c) include any
amendment or supplement thereto at the Closing Date.

(d) The Company shall have requested and caused Lorena Ferreiro Vidal,
General Counsel of the Company, to furnish to the Representatives her opinion, dated the
Closing Date and addressed to the Representatives, substantially to the effect that:

24
(i) the Company has been duly created and is validly existing as a state-
owned company under the laws of Chile, with full corporate power and authority
to own or lease, as the case may be, and to operate its properties, exercise its
mining concessions, mining rights and water rights, and conduct its business as
described in each of the Time of Sale Memorandum and the Final Memorandum,
and is duly qualified to do business under the laws of each jurisdiction which
requires such qualification;

(ii) the Indenture has been duly authorized, executed and delivered, and
constitutes a legal, valid and binding instrument enforceable against the Company
in accordance with its terms (subject, as to the enforcement of remedies, to
applicable bankruptcy, liquidation, reorganization, insolvency, moratorium or
other laws affecting creditors” rights generally and general principles of equity,
including, without limitation, concepts of materiality, reasonableness, good faith
and fair dealing (regardless of whether considered in a proceeding in equity or at
law); and the Securities have been duly and validly authorized and, when
executed and authenticated in accordance with the provisions of the Indenture and
delivered to and paid for by the Initial Purchasers under this Agreement, will have
been duly executed and delivered by the Company and will constitute legal, valid,
binding and enforceable obligations of the Company entitled to the benefits of the
Indenture (subject, as to the enforcement of remedies, to applicable bankruptcy,
liquidation, reorganization, insolvency, moratorium or other laws affecting
creditors” rights generally and general principles of equity, including, without
limitation, concepts of materiality, reasonableness, good faith and fair dealing
(regardless of whether considered in a proceeding in equity or at law);

(iii) to the knowledge of such counsel, there is no pending or threatened
action, suit or proceeding by or before any court or governmental agency,
authority or body or any arbitrator involving the Company or any of its
subsidiaries or its or their property that is not set forth in or contemplated by each
of the Time of Sale Memorandum and the Final Memorandum (exclusive of any
amendment or supplement thereto), except for such proceedings that, if the
subject of an unfavorable decision, ruling or finding, would not, singly or in the
aggregate, have a current or prospective material adverse effect (1) on the
condition (financial or otherwise), earnings, business or properties of the
Company and its subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, or (ii) on the power or ability of
the Company to perform its obligations under this Agreement, the Indenture or
the Securities or to consummate the transactions contemplated in each of the Time
of Sale Memorandum and the Final Memorandum;

(iv) the Company has an authorized capitalization as set forth in each of
the Time of Sale Memorandum and the Final Memorandum under the heading
“Capitalization”; and all the outstanding shares of capital stock or other equity
interests of each subsidiary of the Company have been duly and validly
authorized and issued, are fully paid and non-assessable and are owned directly or
indirectly by the Company, free and clear of any lien, charge, encumbrance,

25
security interest, restriction on voting or transfer or any other claim of any third
party;

(v) such counsel has no reason to believe that (1) at the Execution Time,
the Time of Sale Memorandum contained any untrue statement of a material fact
or omitted to state any material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not misleading; or (ii)
at the Execution Time and on the Closing Date, the Final Memorandum contained
or contains any untrue statement of a material fact or omitted or omits to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading (in each case, other
than the financial statements and other financial information contained therein, as
to which such counsel need express no opinion);

(vi) this Agreement has been duly authorized, executed and delivered by
the Company;

(vii) the Company has all requisite corporate power and authority, has
taken all requisite corporate action and has received and is in compliance with all
governmental, judicial and other authorizations, approvals and orders necessary to
enter into and perform its obligations under this Agreement and the Indenture and
to issue and perform its obligations under the Securities, and no consent,
approval, authorization, filing with or order of any Chilean court or governmental
agency or body is required in connection with the transactions contemplated
herein, in the Indenture or in the Securities, except (1) such as may be required
under the blue sky or securities laws of any jurisdiction in connection with the
purchase and sale of the Securities by the Initial Purchasers in the manner
contemplated in this Agreement, the Time of Sale Memorandum and the Final
Memorandum, and (ii) the following authorizations and registrations required by
Chilean law, which have been obtained and remain in full force and effect:

(A) authorization granted by the President of Chile and by Decree of the Minister
of Finance, whether general or specific, pursuant to Article 4 of Decree Law

No. 2,349 of 1978, and pursuant to Decree No. 1,009 issued by the Ministry of
Finance, published in the Official Gazette on December 23, 1978, as renewed by
Decree No. 1,554 dated October 28, 2019 and published in the Official Gazette on
December 18, 2019; (B) authorization granted by the Minister of Finance to the
Company to enter into negotiations relating to the issue of the Securities, pursuant
to Decree Law No. 1,350 of 1976, as amended and pursuant to Ordinary
Resolution No. 2741 issued by the Ministry of Finance on November 26, 2020;
(C) authorization granted by the Minister of Finance to the Company to issue the
Securities, pursuant to Decree Law No. 1,350 of 1976, as amended and pursuant
to Ordinary Resolution No. 2796 issued by the Ministry of Finance on December
4, 2020; and (D) the delivery to the Ministry of Finance and the Ministry of
Mining for approval and possible review of the proposed annual budget and a
debt amortization budget pursuant to Decree Law No. 1,350 of 1976, as amended;

26
(viii) pursuant to Article 52 of the Organic Law of the Central Bank of
Chile and Decree Law No. 1,350 of 1976, as amended, the Company is exempt
from the Central Bank of Chile”s regulations in connection with the issuance,
placement and payments upon the Securities. The Company is entitled to make
payments under the Securities with its own available foreign currency obtained
from its export operations and deposited with the Central Bank of Chile;

(ix) neither the execution and delivery of the Indenture or this
Agreement, the issue and sale of the Securities, nor the consummation of any
other of the transactions herein or therein contemplated, nor the fulfillment of the
terms hereof or thereof will conflict with, result in a breach or violation of, or
imposition of any lien, charge or encumbrance upon any property or asset of the
Company or any of its subsidiaries pursuant to: (i) any provision of applicable
law; (ii) Decree Law No. 1,350 of 1976, as amended from time to time, and the
Company”s by-laws, as restated in Decree No. 3 of January 13, 2012, or the
Estatutos of the Company, (iii) the terms of any indenture, contract, lease,
mortgage, deed of trust, note agreement, loan agreement or other agreement,
obligation, condition, covenant or instrument to which the Company or any of its
subsidiaries is a party or bound or to which its respective property is subject; or
(iv) any statute, law, rule, regulation, judgment, order or decree applicable to the
Company or any of its subsidiaries of any court, regulatory body, administrative
agency, governmental body, arbitrator or other authority having jurisdiction over
the Company, any of its subsidiaries or any of their respective properties;

(x) the statements in each of the Time of Sale Memorandum and the
Final Memorandum under the captions “Presentation of Financial and Statistical
Information”, “Enforceability of Civil Liabilities”, “Exchange Rates”, “Risk
Factors—Risks Relating to CODELCO”s Operations—CODELCO”s compliance
with environmental, health and safety laws may require increased costs, including
capital commitments, and non-compliance may subject it to significant penalties”,
“Risk Factors—Risks Relating to CODELCO”s Operations —Future compliance
with a changing and complex regulation scheme may require changes in
CODELCOS*s business”, “Risk Factors—Risks Relating to CODELCO”s
Operations—Labor disruptions involving CODELCO”s employees or the
employees of its independent contractors could affect CODELCO”s production
levels and costs”, “Risk Factors—Risks Relating to CODELCO”s Operations—
CODELCO is subject to an extensive labor reform law promulgated by the
Government of Chile that could affect its business and operating results in the
future”, “Risk Factors—Risks Relating to CODELCO”s Relationship with the
Government of Chile”, “Management’s Discussion and Analysis of Financial
Condition and Results of Operations—Results of Operations for the Nine Months
Ended September 30, 2019 and 2020—Other expenses”, “Management’s
Discussion and Analysis of Financial Condition and Results of Operations—
Results of Operations for the Nine Months Ended September 30, 2019 and
2020 —Foreign exchange differences”, “Management’s Discussion and Analysis
of Financial Condition and Results of Operations—Results of Operations for the
Nine Months Ended September 30, 2019 and 2020—Income tax expense”,

27
“Management”s Discussion and Analysis of Financial Condition and Results of
Operations—Results of Operations for the Three Years Ended December 31,
2019—Other expenses”, “Management’s Discussion and Analysis of Financial
Condition and Results of Operations—Results of Operations for the Three Years
Ended December 31, 2019 —Income tax expense”, “Management’s Discussion
and Analysis of Financial Condition and Results of Operations—Liquidity and
Capital Resources—Distributions to the Chilean Treasury”, “Regulatory
Framework”, “Management”, “Related Party Transactions”, “Foreign Investment
and Exchange Controls in Chile” and “Taxation—Chilean Taxation”, insofar as
such statements constitute summaries of Chilean legal matters, documents or
proceedings referred to therein, fairly summarized the matters therein;

(xi) no subsidiary of the Company is currently prohibited, directly or
indirectly, from paying any dividends to the Company, from making any other
distribution on such subsidiary”s capital stock, from repaying to the Company any
loans or advances to such subsidiary from the Company or from transferring any
of such subsidiary”s property or assets to the Company or any other subsidiary of
the Company, except as described in or contemplated by each of the Time of Sale
Memorandum and the Final Memorandum (exclusive of any amendment or
supplement thereto);

(xii) the Company and its subsidiaries possess all concessions, licenses,
certificates, permits and other authorizations issued by the appropriate
government and other regulatory authorities necessary to conduct their respective
businesses, and neither the Company nor any such subsidiary has received any
notice of proceedings relating to the revocation or modification of any such
concession, certificate, authorization or permit which, singly or in the aggregate,
if the subject of an unfavorable decision, ruling or finding, would have a current
or prospective material adverse effect on the condition (financial or otherwise),
earnings, business or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary course of business;

(xiii) the Company and its subsidiaries have good and marketable title to
all real property owned by them and good title to all other properties owned by
them, including the Company”s mining concessions, mining rights and water
rights, in each case, free and clear of all mortgages, pledges, liens, security
interests, claims, restrictions or encumbrances of any kind except (i) such as are
set forth in or contemplated by each of the Time of Sale Memorandum and the
Final Memorandum (exclusive of any amendment or supplement thereto) or (ii)
where the failure to have good title would not have a current or prospective
material adverse effect on the condition (financial or otherwise), earnings,
business or properties of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of business; all of
the leases and subleases material to the business of the Company and its
subsidiaries, taken as a whole, and under which the Company or any of its
subsidiaries holds properties described in each of the Time of Sale Memorandum
and the Final Memorandum, are in full force and effect, except (1) where the

28
failure to be in full force and effect would not have a current or prospective
material adverse effect on the condition (financial or otherwise), earnings,
business or properties of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of business, or (ii)
such as are set forth in or contemplated by each of the Time of Sale Memorandum
and the Final Memorandum (exclusive of any amendment or supplement thereto);
and none of the Company or its subsidiaries has any notice of any material claim
of any sort that has been asserted by anyone adverse to the rights of the Company
or any of its subsidiaries under any of the leases or subleases mentioned above, or
affecting or questioning the rights of the Company or any of its subsidiaries to the
continued possession of the leased or subleased premises under any such lease or
sublease, except (1) claims which are being contested by the Company or its
subsidiaries in good faith and which would not have a current or prospective
material adverse effect on the condition (financial or otherwise), earnings,
business or properties of the Company and its subsidiaries, taken as a whole,
whether or not arising from transactions in the ordinary course of business, or (ii)
such as are set forth in or contemplated by each of the Time of Sale Memorandum
and the Final Memorandum (exclusive of any amendment or supplement thereto);

(xiv) the choice of law provisions set forth in Section 15 hereof, in the
Indenture and in the Securities are legal, valid and binding under the laws of Chile
and such counsel knows of no reason why the courts of Chile would not give
effect to the choice of New York law as the proper law of this Agreement, of the
Indenture and of the Securities; the Company has the legal capacity to sue and be
sued in its own name under the laws of Chile; the Company has been empowered
by Decree No. 1,009 issued by the Ministry of Finance, published in the Official
Gazette on December 23, 1978, as renewed by Decree No. 1,554 dated October
28, 2019 and published in the Official Gazette on December 18, 2019, to submit,
and has irrevocably submitted, to the non-exclusive jurisdiction of the New York
courts and has validly and irrevocably appointed Cogency Global Inc. as its
authorized agent for the purpose described in Section 14 hereof, in the Indenture
and in the Securities under the laws of Chile; the irrevocable submission of the
Company to the non-exclusive jurisdiction of the New York courts and the
waivers by the Company of any objection to the venue of the proceeding in a New
York court herein, in the Indenture and in the Securities are legal, valid and
binding under the laws of Chile and such counsel knows of no reason why the
courts of Chile would not give effect to such submission and waivers; service of
process in the manner set forth in Section 14 hereof, in the Indenture and in the
Securities will be effective to confer valid personal jurisdiction over the Company
under the laws of Chile; and the courts in Chile will recognize as valid and final,
and will enforce, any final and conclusive judgment against the Company
obtained in a New York court arising out of or in relation to the obligations of the
Company under this Agreement, the Indenture or the Securities, subject only to
the conditions and qualifications described in each of the Time of Sale
Memorandum and the Final Memorandum under the caption “Enforceability of
Civil Liabilities”;

29
(xv) to the knowledge of such counsel, the Company and its subsidiaries
(i) are in compliance with any and all Environmental Laws, (ii) have received all
permits, licenses or other approvals required of them under applicable
Environmental Laws to conduct their respective businesses and (iii) are in
compliance with all terms and conditions of any such permit, license or approval,
except where such noncompliance with Environmental Laws, failure to receive
required permits, licenses or other approvals or failure to comply with the terms
and conditions of such permits, licenses or approvals would not, singly or in the
aggregate, have a material adverse effect on the condition (financial or otherwise),
earnings, business or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary course of business;

(xvi) except as disclosed in each of the Time of Sale Memorandum and
the Final Memorandunm, there are no transaction, stamp or other issuance or
transfer taxes or duties or other similar fees or withholdings or charges required to
be paid in connection with the execution and delivery of this Agreement, the
Indenture, the issuance or sale by the Company of the Securities or the
enforcement of the Securities, other than (i) a 0.8% stamp tax on the incurrence of
the indebtedness evidenced by the Securities, which willbe paid by the Company
upon the issuance of the Securities, and (ii) a 4% withholding tax on interest
payments, and all other payments deemed to be interest payments, with respect to
the Securities to the extent paid to a person domiciled or residing outside of Chile.
Tf thin capitalization rules apply, as described in the Time of Sale Memorandum
and the Final Memorandum, such interest payments would be subject to a 35%
penalty tax that would be payable by the Company. The withholding tax
applicable to the interest payments made by the Company can be credited against
such 35% penalty tax. Payments of fees, compensations and reimbursement of
costs contemplated in this Agreement or in the Indenture, made to persons
domiciled or residing outside of Chile are (or may be, in the case of
reimbursement of costs) subject to a withholding tax at a rate of up to 35%;
provided, however, that any such payment (A) is exempted from withholding tax
if 1t is deemed a “comisión mercantil” pursuant to the Commercial Code of Chile
and the interpretation of the SII or (B) subject to a 15% withholding tax if it is
deemed payment for a professional or technical assistance service, provided that
the payment is not made to a party organized, domiciled or resident in one of the
countries which falls under the scope of article 41H of the Chilean Income Tax
Law. The withholding tax rate applicable to payments of fees, compensation,
services and reimbursement of costs to a person not domiciled in, or resident of,
Chile may be reduced or may be exempted if there is a double taxation treaty in
force between Chile and the country of such person”s residency that contemplates
a reduced or exempt regime applicable to such payments;

(xvii) none of the holders of the Securities, the Initial Purchasers or the
Trustee will be deemed resident, domiciled, carrying on business or subject to any
tax liability in Chile solely by reason of the holding of the Securities or the
execution, delivery, performance or enforcement of this Agreement, the Indenture

30
or the Securities, assuming that none of such persons is domiciled or is a resident
of Chile or has a permanent establishment in Chile;

(xviii) the Company has validly and irrevocably waived pursuant to
Section 17 hereof and to the provisions of the Indenture and the Securities for
itself and its revenues and assets, to the full extent permitted by Chilean law, any
immunity from suit, jurisdiction, attachment in aid or execution of a judgment or
prior to a judgment, execution of a judgment or any other legal process with
respect to its obligations, respectively, under this Agreement, the Indenture and
the Securities that it may be entitled or become entitled whether or not claimed,
including sovereign immunity, except that (i) for the attachment and judicial sale
of mining concessions and installations and other goods permanently dedicated to
exploration or extraction of minerals relating to such mining concessions, except
with respect to mortgages, the consent of the Company will be required and shall
be given in the same judicial proceeding in which the attachment and sale is
sought (as set forth in article 226 of the Mining Code of Chile); and (ii) pursuant
to the Chilean Constitution, the mining concessions corresponding to mining
deposits exploited by the Company upon its creation in 1976 cannot be subject to
attachment nor to any act of disposition by the Company. Each such waiver is
binding under Chilean law and remains in full force and effect; and

(xix) this Agreement, the Indenture and the Securities are in proper legal
form under the laws of Chile for the enforcement thereof against the Company in
Chile without the need to obtain any other consent, approval or authorization, to
file any notification or to take any further action on the part of the Initial
Purchasers or the Trustee and to ensure the legality, validity, enforceability or
admissibility in evidence of any of this Agreement, the Indenture and the
Securities, and except for their translation into Spanish for their presentation to a
Chilean court and subject to the payment of the applicable stamp tax, if any (and
applicable readjustments and penalties, if any), it is not necessary that any other
document be filed or recorded with any court or other authority in Chile or that
any stamp or similar tax be paid on or in respect of any such document or the
Securities.

In rendering such opinion, such counsel may rely (A) as to matters involving the
application of laws of any jurisdiction other than Chile, to the extent they deem proper and
specified in such opinion, upon the opinion of other counsel of good standing whom they believe
to be reliable and who are satisfactory to counsel for the Initial Purchasers; and (B) as to matters
of fact, to the extent they deem proper, on certificates of responsible officers of the Company and
public officials. References to the Final Memorandum in this Section 6(d) include any
amendment or supplement thereto at the Closing Date.

(e) The Representatives shall have received from Davis Polk € Wardwell LLP,
U.S. counsel for the Representatives, such opinion or opinions, dated the Closing Date
and addressed to the Representatives, with respect to the issuance and sale of the
Securities, the Indenture, the Time of Sale Memorandum and the Final Memorandum (as
amended or supplemented at the Closing Date) and other related matters as the

31
Representatives may reasonably require, and the Company shall have furnished to such
counsel such documents as they request for the purpose of enabling them to pass upon
such matters.

(f) The Representatives shall have received from Philippi, Prietocarrizosa
Ferrero DU áz Uría, Chilean counsel for the Representatives, such opinion or opinions,
dated the Closing Date and addressed to the Representatives, with respect to the issuance
and sale of the Securities, the Indenture, the Time of Sale Memorandum, the Final
Memorandum (as amended or supplemented at the Closing Date) and other related
matters as the Representatives may reasonably require, and the Company shall have
furnished to such counsel such documents as they request for the purpose of enabling
them to pass upon such matters.

(2) The Company shall have furnished to the Representatives a certificate of the
Company, signed by the Head of Finance of the Company, dated the Closing Date, to the
effect that the signatory of such certificate has carefully examined each of the Time of
Sale Memorandum, the Final Memorandum, any amendment or supplement to the Final
Memorandum and this Agreement and that:

(i) the representations and warranties of the Company in this
Agreement are true and correct in all material respects on and as of the Closing
Date with the same effect as if made on the Closing Date, and the Company has
complied with all the agreements and satisfied all the conditions on its part to be
performed or satisfied hereunder at or prior to the Closing Date; and

(11) since the date of the most recent financial statements included in
each of the Time of Sale Memorandum and the Final Memorandum (exclusive of
any amendment or supplement thereto), there has been no development giving
rise to a current or prospective material adverse change in the condition (financial
or otherwise), earnings, business or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from transactions in the
ordinary course of business, except as set forth in or contemplated by each of the
Time of Sale Memorandum and the Final Memorandum (exclusive of any
amendment or supplement thereto).

(h) At the Execution Time and at the Closing Date, the Company shall have
requested and caused Deloitte Auditores y Consultores Ltda., independent audit firm with
respect to the Company, to furnish to the Representatives letters, dated respectively as of
the Execution Time and as of the Closing Date, in form and substance satisfactory to the
Representatives, containing statements and information of the type ordinarily included in
accountants” “comfort letters” to underwriters with respect to the full-year 2017, 2018
and 2019 financial statements, the interim unaudited consolidated financial statements as
of and for the nine months ended September 30, 2019 and September 30, 2020, and
certain financial and other information contained in each of the Preliminary
Memorandum and the Final Memorandum; provided that the letter delivered on the
Closing Date shall use a “cut-off date” not earlier than three business days prior to the
date thereof.

32
References to the Final Memorandum in this Section Error! Reference source
not found. include any amendment or supplement thereto at the date of the applicable letter.

(i) Subsequent to the Execution Time or, if earlier, the dates as of which
information is given in each of the Time of Sale Memorandum and the Final
Memorandum (exclusive of any amendment or supplement thereto), there shall not have
been (i) any change or decrease specified in the letter or letters referred to in
paragraph Error! Reference source not found. of this Section 6; or (ii) any change, or
any development involving a prospective change, in or affecting the condition (financial
or otherwise), business or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the ordinary course of business, except
as set forth or contemplated in the Time of Sale Memorandum and the Final
Memorandum (exclusive of any amendment or supplement thereto) the effect of which,
in any case referred to in clause (1) or (ii) above, is, in the reasonable judgment of the
Representatives, so material and adverse as to make it impractical or inadvisable to
proceed with the offering, sale or delivery of the Securities as contemplated by the Time
of Sale Memorandum and the Final Memorandum (exclusive of any amendment or
supplement thereto).

() Subsequent to the Execution Time, there shall not have been any decrease in
the rating accorded the Company or any of the Company”s foreign-currency denominated
debt securities by any “nationally recognized statistical rating organization” (as such term
is defined in Section 3(a)(62) of the Exchange Act) or any notice given of any intended or
potential decrease in any such rating or of a possible change in any such rating that does
not indicate the direction of the possible change.

(k) At the Execution Time and on the Closing Date, the Representatives shall
have received a written certificate executed by the Chief Financial Officer of the
Company, in form and substance reasonably satisfactory to the Representatives, with
respect to certain financial information contained in the Offering Memorandum.

(1) Prior to the Closing Date, the Company shall have furnished to the
Representatives such further information, certificates and documents as the
Representatives may reasonably request.

Tf any of the conditions specified in this Section 6 shall not have been fulfilled in
all material respects when and as provided in this Agreement, or if any of the opinions and
certificates mentioned above or elsewhere in this Agreement shall not have been delivered in
form and substance reasonably satisfactory to the Representatives and counsel for the Initial
Purchasers, this Agreement and all obligations of the Initial Purchasers hereunder may be
canceled at, or at any time prior to, the Closing Date by the Representatives. Notice of such
cancellation shall be given to the Company in writing or by telephone or facsimile confirmed in
writing.

The documents required to be delivered by this Section 6 will be delivered at the
office of counsel for the Initial Purchasers, Davis Polk 8 Wardwell LLP, at 450 Lexington
Avenue, New York, New York 10017, on the Closing Date.

33
7. Indemnification and Contribution. (a) The Company agrees to indemnify and hold
harmless each Initial Purchaser, the directors, officers, employees, affiliates and agents of each
Initial Purchaser and each person who controls any Initial Purchaser within the meaning of either
the Act or the Exchange Act against any and all losses, claims, damages or liabilities, joint or
several, to which they or any of them may become subject under the Act, the Exchange Act or
any other federal or state statutory law or regulation, at common law or otherwise, insofar as
such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of a material fact contained in the Time of
Sale Memorandum, any Additional Written Offering Communication prepared by or on behalf
of, used by, or referred to by the Company, any “road show” as defined in Rule 433(h) under the
Act (a “road show”), or the Final Memorandum or any information provided by the Company to
any holder or prospective purchaser of Securities pursuant to Section 5(j), or in any amendment
thereof or supplement thereto, or arise out of or are based upon the omission or alleged omission
to state therein a material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not misleading, and
agrees to reimburse each such indemnified party, for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such loss, claim, damage,
liability or action, as such expenses are incurred; provided, however, that the Company will not
be liable in any such case to the extent that any such loss, claim, damage or liability arises out of
or is based upon any such untrue statement or alleged untrue statement or omission or alleged
omission made in the Time of Sale Memorandum or the Final Memorandum, or in any
amendment thereof or supplement thereto, or in any Additional Written Offering
Communication, in reliance upon and in conformity with written information furnished to the
Company by or on behalf of any Initial Purchasers through the Representatives specifically for
inclusion therein.

(b) Each Initial Purchaser severally and not jointly agrees to indemnify and
hold harmless the Company, each of its directors, each of its officers, and each person
who controls the Company within the meaning of either the Act or the Exchange Act, to
the same extent as the foregoing indemnity from the Company to each Initial Purchaser,
but only with reference to information relating to such Initial Purchaser furnished to the
Company in writing by or on behalf of such Initial Purchaser through the Representatives
specifically for inclusion in the Time of Sale Memorandum, road show or the Final
Memorandum (or in any amendment or supplement thereto). The indemnity agreement
under this Section 7 will be in addition to any liability which any Initial Purchaser may
otherwise have. The Company acknowledges that (1) the names of the Representatives
set forth on the cover page, (ii) the statements set forth in the last paragraph of the cover
page regarding delivery of the Securities and (111) under the heading “Plan of
Distribution”: (A) the names of the Representatives and the amounts in the table, (B) the
single sentence following the second full paragraph regarding the purchase price, (C) the
fifth sentence of the eighth paragraph regarding market making activities, (D) the ninth
paragraph related to stabilization and syndicate covering transactions and (E) the third
sentence of the eleventh paragraph regarding hedging activity, constitute the only
information furnished in writing by or on behalf of the Initial Purchasers for inclusion in
the Time of Sale Memorandum or the Final Memorandum (or in any amendment or
supplement thereto).

34
(c) Promptly after receipt by an indemnified party under this Section 7 of notice
of the commencement of any action, such indemnified party will, if a claim in respect
thereof is to be made against the indemnifying party under this Section 7, notify the
indemnifying party in writing of the commencement thereof; but the failure so to notify
the indemnifying party (1) will not relieve it from liability under paragraphs (a) or (b)
above unless and to the extent it did not otherwise learn of such action and such failure
results in the forfeiture by the indemnifying party of substantive rights and defenses; and
(ii) will not, in any event, relieve the indemnifying party from any obligations to any
indemnified party other than the indemnification obligation provided in paragraphs (a) or
(b) above. The indemnifying party shall be entitled to appoint counsel of the
indemnifying party”s choice at the indemnifying party”s expense to represent the
indemnified party in any action for which indemnification is sought (in which case the
indemnifying party shall not thereafter be responsible for the fees and expenses of any
separate counsel (including local counsel) retained by the indemnified party or parties
except as set forth below); provided, however, that such counsel shall be satisfactory to
the indemnified party. Notwithstanding the indemnifying party”s election to appoint
counsel to represent the indemnified party in an action, the indemnified party shall have
the right to employ separate counsel (including local counsel), and the indemnifying
party shall bear the reasonable fees, costs and expenses of such separate counsel if (1) the
use of counsel chosen by the indemnifying party to represent the indemnified party would
present such counsel with a conflict of interest; (ii) the actual or potential defendants in,
or targets of, any such action include both the indemnified party and the indemnifying
party and the indemnified party shall have reasonably concluded that there may be legal
defenses available to it and/or other indemnified parties which are different from or
additional to those available to the indemnifying party; (111) the indemnifying party shall
not have employed counsel satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of the institution of such action;
or (iv) the indemnifying party shall authorize the indemnified party to employ separate
counsel at the expense of the indemnifying party. It is understood, however, that the
indemnifying party shall, in connection with any one such action or separate but
substantially similar or related actions in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the reasonable fees and expenses of
only one such separate firm of attorneys (in addition to any local counsel) at any time for
all such indemnified parties and controlling persons, which firm shall be designated in
writing by the indemnified parties. An indemnifying party will not, without the prior
written consent of the indemnified parties, settle or compromise or consent to the entry of
any judgment with respect to any pending or threatened claim, action, suit or proceeding
in respect of which indemnification or contribution may be sought hereunder (whether or
not the indemnified parties are actual or potential parties to such claim or action) unless
such settlement, compromise or consent (i) includes an unconditional release of each
indemnified party from all liability arising out of such claim, action, suit or proceeding;
and (ii) does not include any statement as to or any admission of fault, culpability or a
failure to act by or on behalf of an indemnified party.

(d) In the event that the indemnity provided in paragraphs (a) or (b) of this

Section 7 is unavailable to or insufficient to hold harmless an indemnified party for any
reason, the Company and the Initial Purchasers agree to contribute to the aggregate

35
losses, claims, damages and liabilities (including legal or other expenses reasonably
incurred in connection with investigating or defending same) (collectively “Losses”) to
which the Company and one or more of the Initial Purchasers may be subject in such
proportion as is appropriate to reflect the relative benefits received by the Company on
the one hand and by the Initial Purchasers on the other from the offering of the Securities;
provided, however, that in no case shall any Initial Purchaser (except as may be provided
in any agreement among the Initial Purchasers relating to the offering of the Securities)
be responsible for any amount in excess of the purchase discount or commission
applicable to the Securities purchased by such Initial Purchaser hereunder. If the
allocation provided by the immediately preceding sentence is unavailable for any reason,
the Company and the Initial Purchasers shall contribute in such proportion as is
appropriate to reflect not only such relative benefits but also the relative fault of the
Company on the one hand and of the Initial Purchasers on the other in connection with
the statements or omissions that resulted in such Losses, as well as any other relevant
equitable considerations. Benefits received by the Company shall be deemed to be equal
to the total net proceeds from the offering (before deducting expenses) received by it, and
benefits received by the Initial Purchasers shall be deemed to be equal to the total
purchase discounts and commissions in each case set forth on the cover of the Final
Memorandum. Relative fault shall be determined by reference to, among other things, (1)
whether any untrue or any alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information provided by the Company
on the one hand or the Initial Purchasers on the other, (ii) the intent of the parties and (iii)
their relative knowledge, access to information and opportunity to correct or prevent such
untrue statement or omission. The Company and the Initial Purchasers agree that it
would not be just and equitable if contribution were determined by pro rata allocation or
any other method of allocation which does not take account of the equitable
considerations referred to above. Notwithstanding the provisions of this paragraph (d),
no person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Act) shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 7, each person who controls
an Initial Purchaser within the meaning of either the Act or the Exchange Act and each
director, officer, employee, affiliate and agent of an Initial Purchaser shall have the same
rights to contribution as such Initial Purchaser, and each person who controls the
Company within the meaning of either the Act or the Exchange Act and each officer and
director of the Company shall have the same rights to contribution as the Company,
subject in each case to the applicable terms and conditions of this paragraph (d).
Notwithstanding the provisions of this Section 7, no Initial Purchaser shall be required to
contribute any amount in excess of the discounts received by such Initial Purchaser in
connection with the Securities distributed by it. The Initial Purchasers” obligations to
contribute pursuant to this Section 7 are several, and not joint, in proportion to their
respective commitments as set forth opposite their names in SCHEDULE L

8. Default by an Initial Purchaser. If any one or more Initial Purchasers shall fail to

purchase and pay for any of the Securities agreed to be purchased by such Initial Purchaser
hereunder and such failure to purchase shall constitute a default in the performance of its or their
obligations under this Agreement, the remaining Initial Purchasers shall be obligated severally to
take up and pay for (in the respective proportions which the principal amount of Securities set

36
forth opposite their names in SCHEDULE TI hereto bears to the aggregate principal amount of
Securities set forth opposite the names of all the remaining Initial Purchasers) the Securities
which the defaulting Initial Purchaser or Initial Purchasers agreed but failed to purchase;
provided, however, that in the event that the aggregate principal amount of Securities which the
defaulting Initial Purchaser or Initial Purchasers agreed but failed to purchase shall exceed 10%
of the aggregate principal amount of Securities set forth in SCHEDULE TI hereto, the remaining
Initial Purchasers shall have the right to purchase all, but shall not be under any obligation to
purchase any, of the Securities, and if such nondefaulting Initial Purchasers do not purchase all
the Securities, this Agreement will terminate without liability to any nondefaulting Initial
Purchaser or the Company. In the event of a default by any Initial Purchaser as set forth in this
Section 8, the Closing Date shall be postponed for such period, not exceeding five Business
Days, as the Representatives shall determine in order that the required changes in the Final
Memorandum or in any other documents or arrangements may be effected. Nothing contained in
this Agreement shall relieve any defaulting Initial Purchaser of its liability, if any, to the
Company or any nondefaulting Initial Purchaser for damages occasioned by its default
hereunder.

9. Termination. This Agreement shall be subject to termination in the absolute
discretion of the Representatives, by notice given to the Company prior to delivery of and
payment for the Securities, if at any time prior to such time (i) trading in securities generally on
the Santiago Stock Exchange, the New York Stock Exchange or the Nasdaq National Market
shall have been suspended or limited or minimum prices shall have been established on either
such exchange or the Nasdaq National Market; (ii) trading of any securities issued or guaranteed
by the Company shall have been suspended on any exchange or in any over-the-counter market;
(iii) a banking moratorium shall have been declared in New York either by federal or New York
state authorities or in Chile by the Chilean Central Bank or other competent government
regulator; or (iv) there shall have occurred any outbreak or escalation of hostilities, declaration
by the United States of a national emergency or war or other calamity or crisis the effect of
which on financial markets is such as to make it, in the reasonable judgment of the
Representatives, impracticable or inadvisable to proceed with the offering, sale or delivery of the
Securities as contemplated by this Agreement, the Time of Sale Memorandum and the Final
Memorandum (exclusive of any amendment or supplement thereto).

10. Representations, Covenants and Indemnities to Survive. The respective
agreements, representations, warranties, indemnities and other statements of the Company or its
officers and of the Initial Purchasers set forth in or made pursuant to this Agreement will remain
in full force and effect, regardless of any investigation made by or on behalf of the Initial
Purchasers or the Company or any of the officers, directors or controlling persons referred to in
Section 7 hereof, and will survive delivery of and payment for the Securities. The provisions of
Sections 5(p) and 7 hereof shall survive the termination or cancellation of this Agreement.

11. Recognition of the U.S. Special Resolution Regimes.

(a) In the event that any Initial Purchaser that is a Covered Entity becomes subject to
a proceeding under a U.S. Special Resolution Regime, the transfer from such Initial
Purchaser of this Agreement, and any interest and obligation in or under this Agreement,
will be effective to the same extent as the transfer would be effective under the U.S.

37
Special Resolution Regime if this Agreement, and any such interest and obligation, were
governed by the laws of the United States or a state of the United States.

(b) In the event that any Initial Purchaser that is a Covered Entity or a BHC Act
Affiliate of such Initial Purchaser becomes subject to a proceeding under a U.S. Special
Resolution Regime, Default Rights under this Agreement that may be exercised against
such Initial Purchaser are permitted to be exercised to no greater extent than such Default
Rights could be exercised under the U.S. Special Resolution Regime if this Agreement
were governed by the laws of the United States or a state of the United States.

12. Notices. All communications hereunder will be in writing and effective only upon
receipt, and, if sent to the Representatives, will be mailed, delivered or telefaxed to BofA
Securities, Inc., 1540 Broadway, NY8-540-26-02, New York, NY 10036, Facsimile: (646) 855-
5958, Attention: High Grade Transaction Management/Legal, dg.hg_ua_noticesObofa.com; J.P.
Morgan Securities LLC (fax no.: 212-834-6326), 383 Madison Avenue, New York, New York
10179, Attention: Latin America Debt Capital Markets; Mizuho Securities USA LLC, 1271
Avenue of the Americas, New York, New York 10020 (fax no.: 212-205-7812), Attention: Debt
Capital Markets; and Scotia Capital (USA) Inc. (email: us.legal Escotiabank.com), 250 Vesey
Street, New York, New York 10281, Attention: Debt Capital Markets, or, if sent to the
Company, will be mailed, delivered or telefaxed to the Corporación Nacional del Cobre de Chile,
c/o Lorena Ferreiro Vidal, General Counsel (fax no.: 562-2690-3021) Huérfanos 1270, Santiago,
Chile, Attention: Legal Department.

13. Successors. This Agreement will inure to the benefit of and be binding upon the
parties hereto and their respective successors and the officers and directors and controlling
persons referred to in Section 7 hereof, and, except as expressly set forth in Section 5(¡) hereof,
no other person will have any right or obligation hereunder.

14. Jurisdiction. The Company agrees that any suit, action or proceeding against the
Company brought by any Initial Purchaser, the directors, officers, employees, affiliates and
agents of any Initial Purchaser, or by any person who controls any Initial Purchaser, arising out
of or based upon this Agreement or the transactions contemplated hereby may be instituted in
any New York state or U.S. federal court located in the Borough of Manhattan, the City of New
York, New York, and waives, to the extent legally permitted, any objection which it may now or
hereafter have to the laying of venue of any such proceeding, and irrevocably submits to the non-
exclusive jurisdiction of such courts in any suit, action or proceeding. The Company has
appointed Cogency Global Inc. as its authorized agent (the “Authorized Agent”) upon whom
process may be served in any suit, action or proceeding arising out of or based upon this
Agreement or the transactions contemplated herein which may be instituted in any state or
federal court in the City of New York, New York, by any Initial Purchaser, the directors,
officers, employees, affiliates and agents of any Initial Purchaser, or by any person who controls
any Initial Purchaser, and expressly accepts the non-exclusive jurisdiction of any such court in
respect of any such suit, action or proceeding. The Company hereby represents and warrants that
the Authorized Agent has accepted such appointment and has agreed to act as said agent for
service of process, and the Company agrees to take any and all action, including the filing of any
and all documents that may be necessary to continue such appointment in full force and effect as
aforesaid. Service of process upon the Authorized Agent shall be deemed, in every respect,

38
effective service of process upon the Company. Notwithstanding the foregoing, any action
arising out of or based upon this Agreement may be instituted by any Initial Purchaser, the
directors, officers, employees, affiliates and agents of any Initial Purchaser, or by any person
who controls any Initial Purchaser, in any court of competent jurisdiction in Chile. The
Company hereby irrevocably waives trial by jury in any legal action or proceeding relating to
this Agreement and for any counterclaim relating thereto. The Company acknowledges that each
Initial Purchaser is entering into this Agreement in reliance upon such waiver.

15. Applicable Law. This Agreement and any claim, controversy or dispute arising
under or related to this Agreement will be governed by and construed in accordance with the
laws of the State of New York applicable to contracts made and to be performed within the State
of New York.

16. Currency. Each reference in this Agreement to U.S. dollars (the “relevant
currency”) is of the essence. To the fullest extent permitted by law, the obligation of the
Company in respect of any amount due under this Agreement will, notwithstanding any payment
in any other currency (whether pursuant to a judgment or otherwise), be discharged only to the
extent of the amount in the relevant currency that the party entitled to receive such payment may,
in accordance with its normal procedures, purchase with the sum paid in such other currency
(after any premium and costs of exchange) on the Business Day immediately following the day
on which such party receives such payment. If the amount in the relevant currency that may be
so purchased for any reason falls short of the amount originally due, the Company will pay such
additional amounts, in the relevant currency, as may be necessary to compensate for the shortfall.
Any obligation of the Company not discharged by such payment will, to the fullest extent
permitted by applicable law, be due as a separate and independent obligation and, until
discharged as provided herein, will continue in full force and effect.

17. Waiver of Immunity. To the extent that the Company may be entitled in any
jurisdiction in which judicial proceedings may at any time be commenced hereunder, to claim for
itself or its revenues or assets any immunity, including sovereign immunity, from suit,
jurisdiction, attachment in aid of execution of a judgment or prior to a judgment, execution of a
judgment or any other legal process with respect to its obligations hereunder, and to the extent
that in any such jurisdiction there may be attributed to the Company such an immunity (whether
or not claimed), the Company hereby irrevocably agrees not to claim and irrevocably waives
such immunity to the maximum extent permitted by law, except that (1) for the attachment and
judicial sale of mining concessions and installations and other goods permanently dedicated to
exploration or extraction of minerals relating to such mining concessions, except with respect to
mortgages, the consent of the Company will be required and shall be given in the same judicial
proceeding in which the attachment and sale is sought (as set forth in article 226 of the Mining
Code of Chile); and (ii) pursuant to the Chilean Constitution, the mining concessions
corresponding to mining deposits exploited by the Company upon its creation in 1976 cannot be
subject to attachment nor to any act of disposition by the Company. Each such waiver is binding
under Chilean law and remains in full force and effect. Notwithstanding the foregoing, any
action based on this Agreement may be instituted by the Initial Purchasers in any competent
court in Chile.

39
18. Payment Free and Clear. All payments to be made by the Company under this
Agreement shall be paid free and clear of, and without deduction or withholding for or on
account of, any present or future taxes, levies, imposts, duties, fees, assessments or other charges
of whatever nature (including any amounts that result from the payment of fees, compensation or
reimbursement of costs contemplated in this Agreement or in the Indenture), imposed by Chile,
or by any department, agency or other political subdivision or taxing authority thereof, and all
interest, penalties or similar liabilities with respect thereto (collectively, “Chilean Taxes”). If
any Chilean Taxes are required by law to be deducted or withheld in connection with such
payments, the Company will pay such additional amounts as may be necessary so that the full
amount of such payment is received by the Initial Purchasers, except that no additional amounts
shall be paid with respect to any such taxes, levies, imposts, duties, fees, assessments or charges
(1) imposed by reason of an Initial Purchaser having some connection with the jurisdiction
imposing the tax other than solely as a result of its participation as an Initial Purchaser hereunder
or (ii) imposed by virtue of an Initial Purchaser”s failure to comply with any certification,
identification or other reporting requirement, if such compliance is required under applicable law
as a precondition to relief or exemption from such taxes, levies, imposts, duties, fees,
assessments or charges.

19. Counterparts. This Agreement may be executed in one or more counterparts, each
of which shall constitute an original and all of which together shall constitute one and the same
instrument. Counterparts may be delivered via facsimile, electronic mail (including any
electronic signature covered by the U.S. federal ESIGN Act of 2000, Uniform Electronic
Transactions Act, the Electronic Signatures and Records Act or other applicable law, e.g.,
www.docusign.com) or other transmission method and any counterpart so delivered shall be
deemed to have been duly and validly delivered and be valid and effective for all purposes.

20. Headings. The section headings used herein are for convenience only and shall not
affect the construction hereof.

21. Definitions. The terms which follow, when used in this Agreement, shall have the
meanings indicated.

“Act” shall mean the Securities Act of 1933, as amended, and the rules and
regulations of the Commission promulgated thereunder.
“Affiliate” shall have the meaning specified in Rule 501(b) of Regulation D.

“Business Day” shall mean any day other than a Saturday, a Sunday or a legal
holiday or a day on which banking institutions or trust companies are authorized or obligated by
law to close in the City of New York, New York, U.S.A. or Santiago, Chile.

“BHC Act Affiliate” has the meaning assigned to the term “affiliate” in, and shall
be interpreted in accordance with, 12 U.S.C. $ 1841(k).

“Chile” shall mean the Republic of Chile.
“Commission” shall mean the Securities and Exchange Commission.

“Covered Entity” means any of the following:

40
(i) a “covered entity” as that term is defined in, and interpreted in
accordance with, 12 C.F.R. $ 252.82(b);

(ii) a “covered bank” as that term is defined in, and interpreted in
accordance with, 12 C.F.R. $ 47.3(b); or

(iii) a “covered FSI” as that term is defined in, and interpreted in
accordance with, 12 C.F.R. $ 382.2(b).

“Default Right” has the meaning assigned to that term in, and shall be interpreted
in accordance with, 12 C.F.R. $$ 252.81, 47.2 or 382.1, as applicable.

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the Commission promulgated thereunder.

“Execution Time” shall mean 7:45 P.M., New York City time, on December 7,
2020.

“Investment Company Act” shall mean the Investment Company Act of 1940,
as amended, and the rules and regulations of the Commission promulgated thereunder.

“Regulation D” shall mean Regulation D under the Act.
“Regulation S” shall mean Regulation S under the Act.

“Trust Indenture Act” shall mean the Trust Indenture Act of 1939, as amended,
and the rules and regulations of the Commission promulgated thereunder.

“U.S. Special Resolution Regime” means each of (1) the Federal Deposit
Insurance Act and the regulations promulgated thereunder and (ii) Title II of the Dodd-Frank
Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder.

41
Tf the foregoing is in accordance with your understanding of our agreement,
please sign and return to us the enclosed duplicate hereof, whereupon this Agreement and your
acceptance shall represent a binding agreement between the Company and the several Initial
Purchasers.

Very truly yours,
Corporación Nacional del Cobre de Chile

Name: Alejandro Sanhueza Diaz
Title: Head of Finance

[Signature Page to Purchase Agreement]
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.

BofA Securities, Inc.

Name: Maxim Volkov
Title: Managing Director

For themselves and the other several
Initial Purchasers named in
Schedule Ito the foregoing Agreement.

[Signature page to Purchase Agreement]
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.

J.P. Morgan Securities LLC

By: AM

Name: Ana Silva-Klarish
Title: Executive Director

For themselves and the other several
Initial Purchasers named in
Schedule I to the foregoing Agreement.

[Signature page to Purchase Agreement]
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.

Mizuho Securities USA LLC

By:

Name: Rodrigo Garcia de Leon
Title: Executive Director

For themselves and the other several
Tnitial Purchasers named in
Schedule I to the foregoing Agreement.

[Signature page to Purchase Agreement]
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.

Scotia Capital (USA) Inc.

By 4

Name: Elsa Wang
Title: Managing Director £ Head

For themselves and the other several
Initial Purchasers named in
Schedule 1 to the foregoing Agreement.

[Signature page to Purchase Agreement]
SCHEDULE I

Principal Amount of Securities

Tnitial Purchasers to be Purchased
BOofA Securities, ÍNC. ….ooonoconocononononncoonoconncnonononncnnnononaconnocnnnon U.S.$125,000,000
J.P. Morgan Securities LLC ..oooononcncnicincnnnnconnonnnncnncnncrncnrncnnos U.S.$125,000,000
Mizuho Securities USA LLC U.S.$125,000,000
Scotia Capital (USA) INC. cocococcconncnococononaconcononanncnnonncncnncnnnnnnns U.S.$125,000,000

Total coocncinnconnnnnnaconinononnnnnncnnnnnncncnnnn roca cnn nn oran cnn cncnanncnono U.S.$500,000,000
SCHEDULE II

Time of Sale Memorandum
1. Preliminary Memorandum, dated December 7, 2020.

2. Pricing Term Sheet, dated December 7, 2020.
EXHIBIT A

Selling Restrictions for Offers and Sales outside the United States

(1) (a) The Securities have not been and will not be registered under the Act
and may not be offered or sold within the United States or to, or for the account or benefit of,
U.S. persons except pursuant to an exemption from, or in a transaction not subject to, the
registration requirements of the Act. Each Initial Purchaser represents and agrees that, except as
permitted by Section 4(a)(i) of the Agreement to which this is an exhibit, it has not offered or
sold, and will not offer or sell, any Securities constituting part of its allotment to U.S. persons
(which term shall not include dealers or other professional fiduciaries in the United States acting
on a discretionary basis for foreign beneficial owners (other than an estate or trust)).
Accordingly, each Initial Purchaser represents and agrees that neither it, nor any of its Affiliates
nor any person acting on its or their behalf has engaged or will engage in any directed selling
efforts with respect to the Securities. Terms used in this paragraph have the meanings given to
them by Regulation S.

(b) Each Initial Purchaser also represents and agrees that it has not entered and
will not enter into any contractual arrangement with any distributor (as that term is defined by
Regulation S) with respect to the distribution of the Securities, except with its Affiliates or with
the prior written consent of the Company.

(2) Each Initial Purchaser, severally and not jointly, represents, warrants
and agrees that:

(a) it has only communicated or caused to be communicated and will
only communicate or cause to be communicated any invitation or inducement to engage in
investment activity (within the meaning of Section 21 of the FSMA) received by it in connection
with the issue or sale of any Securities which are the subject of the offering contemplated by the
Offering Memorandum in circumstances in which Section 21(1) of the FSMA does not apply to
the Company;

(b) it has complied and will comply with all applicable provisions of
the FSMA with respect to anything done by it in relation to the Securities in, from or otherwise
involving the United Kingdom; and

(c) it has not offered, sold or otherwise made available and will not
offer, sell or otherwise make available any notes to any retail investor in the European Economic
Area or in the United Kingdom. For the purposes of this provision:

A. the expression “retail investor” means a person who is one (or more) of the following:

(1) a retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU (as
amended, “MiFID IT”); or

(11) a customer within the meaning of Directive 2002/92/EC (as amended, the
“Insurance Mediation Directive”), where that customer would not qualify as a
professional client as defined in point (10) of Article 4(1) of MiFID II; or

(iii) nota qualified investor as defined in Directive 2003/71/EC (as amended, the
“Prospectus Directive”); and
B. the expression “offer” includes the communication in any form and by any means of
sufficient information on the terms of the offer and the notes to be offered so as to enable an
investor to decide to purchase or subscribe the notes.

For purposes of this provision, the expression “Prospectus Directive” means
Directive 2003/71/EC (including Directive 2010/73/EU) and includes any relevant implementing
measure in any Member State of the European Economic Area.
EXHIBIT B

Corporación Nacional del Cobre de Chile

U.S.$500,000,000 3.150% Notes due 2051

Pricing Term Sheet

Issuer:

Security Description:
Type of Offering:
Size:

Maturity Date:
Coupon:

Price to Public:

Yield to Maturity:
Spread to Benchmark Treasury:

Benchmark Treasury:

Benchmark Treasury Price and Yield:

Gross Proceeds to Issuer:

Interest Payment Dates:

Trade Date:
Settlement Date:

Optional Redemption:

+193840133v10

Corporación Nacional del Cobre de Chile
3.150% Notes due 2051 (the “Notes”)
Rule 144A / Regulation S
U.S.$500,000,000

January 15, 2051

3.150%

99.554% of principal amount, plus accrued
interest, if any, from December 14, 2020

3.173%

+148 bps

1.375% due August, 2050
92-19; 1.693%
U.S.$497,770,000

July 15 and January 15, of each year,
commencing July 15, 2021

December 7, 2020

December 14, 2020 (T+5)

Make-whole Call: Prior to July 15, 2050 (the
date that is six months prior to the maturity

date), at T+25 bps

Par Call: On or after July 15, 2050 (the date that
is six months prior to the maturity date)
Tax Redemption: In the event of certain changes in the
withholding tax treatment relating to payments
on the Notes, redeemable in whole but not in
part, at 100% of their principal amount, plus
accrued and unpaid interest to the date of
redemption, and any additional amounts due
thereon.

Additional Amounts: In the event of withholding on account of certain
taxes imposed by Chile, Issuer will pay
additional amounts.

Day Count Convention: 30 /360

Minimum Denominations: U.S.$200,000 / U.S.$1,000
Expected Listing: Luxembourg Euro MTF
Expected Ratings*: A3 / A (Moody’s / S£P)
Joint Book-Running Managers: BofA Securities, Inc.

J.P. Morgan Securities LLC
Mizuho Securities USA LLC
Scotia Capital (USA) Inc.

144A CUSIP / ISIN: 21987B BD9 /US21987BBD91

Regulation S CUSIP / ISIN: P3143N BMS5 / USP3143NBM58

*A securities rating is not a recommendation to buy, sell or hold securities and may be subject to
revision or withdrawal at any time.

Changes to the Preliminary Offering Memorandum dated December 7, 2020 (the “Preliminary
Offering Memorandum”):

The Audited Annual Consolidated Financial Statements were inadvertently omitted from the Preliminary
Offering Memorandum. Those financial statements are available in English on the “Investors” page of
Codelco”s website at:
https://www.codelco.com/prontus_codelco/site/artic/20190530/asocfile/20190530130119/codelcoeeff en
g 31 12 2019.pdf and
https://www.codelco.com/prontus_codelco/site/artic/20180525/asocfile/20180525113413/consolidated_fi
nancial statements dec31_ 2018 codelco chile subsidiarias.pdf

The Audited Annual Consolidated Financial Statements are hereby incorporated by reference into the
Preliminary Offering Memorandum. References in the Preliminary Offering Memorandum to the
Audited Annual Consolidated Financial Statements contained therein shall instead be to the Audited

4

+193840133v10
Annual Consolidated Financial Statements so incorporated by reference. No information other than the
Audited Annual Consolidated Financial Statements on Codelco”s website shall be incorporated by
reference into the Preliminary Offering Memorandum.

This communication is intended for the sole use of the person to whom it is provided by the sender.

The Notes have not been registered under the U.S. Securities Act of 1933, as amended
(the “Securities Act”), and are being offered only (i) to qualified institutional buyers
under Rule 144A of the Securities Act and (ii) outside the United States in compliance
with Regulation S under the Securities Act.

Delivery of the Notes is expected on or about December 14, 2020 which will be the fifth
business day following the date of pricing of the Notes (this settlement cycle being referred to
as “T+5”). Under Rule 15c6-1 of the Exchange Act, trades in the secondary market generally
are required to settle in two business days, unless the parties to any such trade expressly agree
otherwise. Accordingly, purchasers who wish to trade Notes prior to the delivery of the
Notes will be required, by virtue of the fact that the Notes initially will settle in T+5, to
specify an alternate settlement cycle at the time of any such trade to prevent a failed
settlement. Purchasers of the Notes who wish to trade Notes prior to their date of delivery
hereunder should consult their own advisor.

The information in this term sheet supplements the Preliminary Offering Memorandum and
supersedes the information in the Preliminary Offering Memorandum to the extent
inconsistent with the information in the Preliminary Offering Memorandum. This term sheet
should be read in conjunction with the Preliminary Offering Memorandum.

ANY DISCLAIMER OR OTHER NOTICE THAT MAY APPEAR BELOW IS NOT
APPLICABLE TO THIS COMMUNICATION AND SHOULD BE DISREGARDED.
SUCH DISCLAIMER OR NOTICE WAS AUTOMATICALLY GENERATED AS A
RESULT OF THIS COMMUNICATION BEING SENT BY BLOOMBERG OR
ANOTHER E-MAIL SYSTEM.

5

+193840133v10
IMPORTANT NOTICE

THIS OFFERING IS AVAILABLE ONLY TO INVESTORS WHO ARE EITHER (1) QUALIFIED INSTITUTIONAL BUYERS
(“QIBs”) (WITHIN THE MEANING OF RULE 144A UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”)) OR (2) NON-U.S. PERSONS (WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES
ACT) OUTSIDE THE U.S.

IMPORTANT: You must read the following before continuing. The following applies to the Offering Memorandum following this page, and
you are advised to read this carefully before reading, accessing or making any other use of the Offering Memorandum. In accessing the Offering
Memorandum, you agree to be bound by the following terms and conditions, including any modifications thereto any time you receive any
additional information from us.

NOTHING IN THIS ELECTRONIC TRANSMISSION CONSTITUTES AN OFFER OF SECURITIES FOR SALE IN ANY JURISDICTION
WHERE IT IS UNLAWFUL TO DO SO. THE SECURITIES HAVE NOT BEEN, AND WILL NOT BE, REGISTERED UNDER THE
SECURITIES ACT, OR THE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR OTHER JURISDICTION AND THE
SECURITIES MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF,
U.S. PERSONS (AS DEFINED IN REGULATION S UNDER THE SECURITIES ACT), EXCEPT PURSUANT TO AN EXEMPTION FROM,
OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND APPLICABLE
LAWS OF OTHER JURISDICTIONS. THE OFFERING MEMORANDUM AND THE OFFER OF THE NOTES ARE ONLY ADDRESSED
TO AND DIRECTED AT PERSONS IN MEMBER STATES OF THE EUROPEAN ECONOMIC AREA OR IN THE UNITED KINGDOM
WHO ARE “QUALIFIED INVESTORS” AS DEFINED IN REGULATION (EU) 2017/1129 (THE “PROSPECTUS REGULATION”). NO
KEY INFORMATION DOCUMENT REQUIRED BY REGULATION (EU) NO 1286/2014 (AS AMENDED, THE “PRIIPS REGULATION”)
FOR OFFERING OR SELLING THE SECURITIES OR OTHERWISE MAKING THEM AVAILABLE TO RETAIL INVESTORS IN THE
EEA, HAS BEEN PREPARED AND THEREFORE THE OFFERING OR SELLING OF THE SECURITIES OR OTHERWISE MAKING
THEM AVAILABLE TO ANY RETAIL INVESTOR IN THE EEA MAY BE UNLAWFUL UNDER THE PRIIPS REGULATION. THIS
COMMUNICATION IS ONLY BEING DISTRIBUTED TO AND IS ONLY DIRECTED AT (I) PERSONS WHO ARE OUTSIDE THE
UNITED KINGDOM, (II) INVESTMENT PROFESSIONALS FALLING WITHIN ARTICLE 1%(5) OF THE FINANCIAL SERVICES AND
MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005, AS AMENDED, (III) FALL WITHIN ARTICLES 19(Q2)(A) TO (D) OF
THE FINANCIAL SERVICES AND MARKETS ACT 2000 (FINANCIAL PROMOTION) ORDER 2005, AS AMENDED, OR (IV) ARE
PERSONS TO WHOM AN INVITATION OR INDUCEMENT TO ENGAGE IN INVESTMENT ACTIVITY (WITHIN THE MEANING OF
SECTION 21 OF THE FINANCIAL SERVICES AND MARKETS ACT 2000) IN CONNECTION WITH THE ISSUE OR SALE OF ANY
NOTES MAY OTHERWISE LAWFULLY BE COMMUNICATED (ALL SUCH PERSONS TOGETHER REFERRED TO AS “RELEVANT
PERSONS”). THE NOTES ARE ONLY AVAILABLE TO, AND ANY INVITATION, OFFER OR AGREEMENT TO SUBSCRIBE,
PURCHASE OR OTHERWISE ACQUIRE SUCH NOTES ARE ONLY AVAILABLE TO RELEVANT PERSONS AND WILL BE
ENGAGED IN ONLY WITH, RELEVANT PERSONS. ANY PERSON WHO IS NOT A RELEVANT PERSON SHOULD NOT ACT OR
RELY ON THIS DOCUMENT OR ANY OF ITS CONTENTS.

THE FOLLOWING OFFERING MEMORANDUM MAY NOT BE FORWARDED OR DISTRIBUTED TO ANY OTHER PERSON AND
MAY NOT BE REPRODUCED IN ANY MANNER WHATSOEVER. ANY FORWARDING, DISTRIBUTION OR REPRODUCTION OF
THIS DOCUMENT IN WHOLE OR IN PART IS UNAUTHORIZED. FAILURE TO COMPLY WITH THIS NOTICE MAY RESULT IN A
VIOLATION OF THE SECURITIES ACT OR THE APPLICABLE LAWS OF OTHER JURISDICTIONS.

Confirmation of your Representation: In order to be eligible to view this Offering Memorandum or make an investment decision with respect
to the securities, investors must be either (1) QIBs or (2) non-U.S. persons (within the meaning of Regulation S under the Securities Act) outside
the United States. This Offering Memorandum is being sent at your request and by accepting the e-mail and accessing this Offering
Memorandum, you shall be deemed to have represented to us that (1) you and any customers you represent are either (a) QIBs or (b) non-U.S.
persons (within the meaning of Regulation S under the Securities Act) and (2) you consent to the delivery of such Offering Memorandum by
electronic transmission.

You are reminded that this Offering Memorandum has been delivered to you on the basis that you are a person into whose possession this
Offering Memorandum may be lawfully delivered in accordance with the laws of the jurisdiction in which you are located and you may not, nor
are you authorized to, deliver this Offering Memorandum to any other person.

The materials relating to the offering do not constitute, and may not be used in connection with, an offer or solicitation in any place where offers
or solicitations are not permitted by law. If a jurisdiction requires that the offering be made by a licensed broker or dealer and the initial
purchasers or any affiliate of the initial purchasers is a licensed broker or dealer in that jurisdiction, the offering shall be deemed to be made by
the initial purchasers or such affiliate on behalf of the issuer in such jurisdiction.

The following Offering Memorandum has been sent to you in an electronic form. You are reminded that documents transmitted via this
medium may be altered or changed during the process of electronic transmission, and consequently neither the initial purchasers, nor
any person who controls them nor any of their directors, officers, employees nor any of their agents nor any affiliate of any such person
accept any liability or responsibility whatsoever in respect of any difference between the Offering Memorandum distributed to you in
electronic format and the hard copy version available to you on request from the initial purchasers.
OFFERING MEMORANDUM Strictly Confidential

CODELCO

Corporación Nacional del Cobre de Chile
U.S.$500,000,000 3.150 % Notes due 2051

The notes (the “notes”) will bear interest at the rate of 3.150% per year and will mature on January 15, 2051. The
interest on the notes will be payable semi-annually in arrears on January 15 and July 15 of each year, beginning on
July 15, 2021.

We may redeem the notes at our option, in whole or in part, at any time and from time to time prior to the date that is
six months prior to the maturity date, at a redemption price equal to the greater of 100% of the outstanding principal
amount of the notes to be redeemed and a redemption price based on a “make-whole” premium, plus accrued and
unpaid interest to the date of redemption. In addition, we may redeem the notes at our option, in whole or in part, at
any time and from time to time, beginning on the date that is six months prior to the maturity date, at a redemption
price equal to 100% of the outstanding principal amount of the notes to be redeemed, plus accrued and unpaid
interest to the date of redemption. Upon the occurrence of specified events relating to Chilean tax law, we may
redeem the notes in whole, but not in part, at 100% of their principal amount, plus accrued and unpaid interest to the
date of redemption. See “Description of Notes—Tax Redemption” and “—Optional Redemption”.

The notes will constitute direct, general, unconditional, unsecured and unsubordinated obligations of Corporación
Nacional del Cobre de Chile (“CODELCO” or the “Company”). The notes rank and will rank without any
preference among themselves and equally with all other unsubordinated and unsecured obligations of CODELCO,
other than certain obligations granted preferential treatment pursuant to Chilean law. It is understood that this
provision will not be construed so as to require CODELCO to make payments under the notes ratably with payments
being made under any other obligations. See “Description of Notes—Ranking.”

We intend to apply to list the notes on the Official List of the Luxembourg Stock Exchange and for trading on the
Euro MTF market of the Luxembourg Stock Exchange; however, the notes have not yet been listed. Currently, there
is no public market for the notes.

See “Risk Factors” beginning on page 16 for a discussion of certain risks that you should consider in
connection with an investment in the notes.

Neither the U.S. Securities and Exchange Commission (the “SEC”) nor any other regulatory body has
approved or disapproved of these securities or passed upon the adequacy or accuracy of this offering
memorandum. Any representation to the contrary is a criminal offense.

The notes have not been registered under the United States Securities Act of 1933, as amended (the “Securities
Act”), or any state securities laws, and are being offered and sold only to (i) qualified institutional buyers under Rule
144A under the Securities Act and (1i) persons outside the United States under Regulation S under the Securities
Act. For a description of certain restrictions on the transfer of the notes, see “Transfer Restrictions” and “Plan of
Distribution.”

The notes are being offered pursuant to an exemption from the requirement to publish a prospectus under Regulation

(EU) 2017/1129 (as amended and supplemented from time to time, the “Prospectus Regulation”), of the European
Union, and this offering memorandum has not been approved by a competent authority within the meaning of the
cover page continues to this page

Prospectus Regulation. The notes are not intended to be offered, sold, or otherwise made available to and should not
be offered, sold, or otherwise made available to any retail investor in the European Economic Area.

Concurrently with this offering, we are launching a cash tender offer for (a) any and all (the “Any and All Offer”) of
our outstanding (i) U.S.$226,981,000 aggregate principal amount of 3.875% Notes due 2021 (the “2021 Notes”), (ii)
U.S.$412,475,000 aggregate principal amount of 3.000% Notes due 2022 (the “2022 Notes”), and (iii)
U.S.$465,871,000 aggregate principal amount of 4.500% Notes due 2023 (the “2023 Notes” and, together with the
2021 Notes and the 2022 Notes, the “Any and All Notes”) and (b) up to an aggregate principal amount not to exceed
the lesser of (x) U.S.$700,000,000 and (y) the difference between U.S.$1,105,327,000, which is the aggregate
maximum principal amount of the Any and All Offer, and the aggregate principal amount of the Any and All Notes
validly tendered and accepted for purchase in the Any and All Tender Offer (the “Maximum Tender Offer” and,
together with the Any and All Offer, the “Tender Offers”) of (i) U.S.$1,068,601,000 aggregate principal amount of
4.500% Notes due 2025 (the “2025 Notes”) and (ii) U.S.$1,500,000,000 aggregate principal amount of 3.625%
Notes due 2027 (the “2027 Notes” and, together with the 2025 Notes and the Any and All Notes, the “Tender
Notes”), in each case, validly tendered and accepted by us on or before the expiration date of the applicable Tender
Offer. We intend to use the net proceeds from the sale of the notes (i) to pay the consideration for the Tender Offers
and accrued and unpaid interest on the Tender Notes, (ii) to pay fees and expenses incurred in connection with the
Tender Offers and (iii) the remainder, if any, for general corporate purposes. The Tender Offers are not being made
pursuant to this offering memorandum. The closing of the Tender Offers is contingent upon the closing of this
offering.

Issue price per note: 99.554% plus accrued interest, if any, from December 14, 2020.
The notes will be delivered in book-entry form only through the facilities of The Depository Trust Company
(“DTC”) and its direct and indirect participants, including Euroclear Bank S.A./N.V. (“Euroclear”), as operator of

the Euroclear system, and Clearstream Banking, S.A., Luxembourg (“Clearstream”) on or about December 14, 2020.

Joint Book-Running Managers

BofA Securities J.P. Morgan Mizuho Securities Scotiabank

The date of this offering memorandum is December 7, 2020.
We have not, and the initial purchasers have not, authorized anyone to provide any information
other than that contained in this offering memorandum. We and the initial purchasers take no responsibility
for, and can provide no assurance as to the reliability of, any other information that others may give you. We
are not, and the initial purchasers are not, making an offer of these securities in any jurisdiction where the
offer is not permitted. Prospective investors should not assume that the information contained in this offering
memorandum is accurate as of any date other than the date on the front of this offering memorandum.

After having made all reasonable inquiries, we confirm that (i) the information contained in this offering
memorandum is true and accurate in all material respects, (ii) the opinions and intentions expressed herein are
honestly held and (iii) there are no other facts the omission of which would make this offering memorandum as a
whole, or any of such information or the expression of any such opinions or intentions, misleading. CODELCO
accepts responsibility accordingly.

Unless otherwise indicated or the context otherwise requires, all references in this offering memorandum to
“CODELCO,” the “Company,” “we,” “our,” “ours,” “us” or similar terms refer to Corporación Nacional del Cobre
de Chile (CODELCO) together with its subsidiaries.

TABLE OF CONTENTS
Page
Note Regarding Forward-Looking Statements …cooociciciconononnnonocnnnonononocnnncnanononnononann coca ononann on on ononann on ononon an nan on ononannancnno lv

Enforceability of Civil Liabilities
Presentation of Financial and Statistical Information
Summary.
Risk Factors
Use of Proceeds .
Capitalization
Exchange Rates .
Selected Consolidated Financial Data
Selected Operating Data
Management’s Discussion and Analysis of Financial Condition and Results of Operations ..
Business and Properties…
Overview of the Copper Market…
Regulatory Framework
Management
Related Party Transactions
Foreign Investment and Exchange Controls in Chile
Description of Notes
Taxation
Plan of Distribution .
Transfer Restrictions
Validity of the Notes
Independent Auditors
Glossary of Certain Mining Terms.
General Information
Financial Statements

The notes may not be offered or sold, directly or indirectly, in the Republic of Chile (“Chile”) or to any
resident of Chile, except as permitted by applicable Chilean law.
This offering memorandum has been prepared by CODELCO solely for use in connection with the
proposed offering of the securities described herein. This offering memorandum is personal to each offeree and does
not constitute an offer to any other person or to the public generally to subscribe for, or otherwise acquire, securities.
We and the initial purchasers reserve the right to reject for any reason any offer to purchase any of the notes.

This offering memorandum may only be used for the purposes of this offering.

The initial purchasers make no representation or warranty, express or implied, as to the accuracy or
completeness of the information contained in this offering memorandum. Nothing contained in this offering
memorandum is, or shall be relied upon as, a promise or representation by the initial purchasers as to the past or
future. CODELCO has furnished the information contained in this offering memorandum.

In making an investment decision, prospective investors must rely on their own examination of CODELCO
and the terms of the offering, including the merits and risks involved. Prospective investors should not construe
anything in this offering memorandum as legal, business or tax advice. Each prospective investor should consult its
own advisors as needed to make its investment decision and to determine whether it is legally permitted to purchase
the securities under applicable legal investment or similar laws or regulations. Investors should be aware that they
may be required to bear the financial risks of this investment for an indefinite period of time.

This offering memorandum contains summaries believed to be accurate with respect to certain documents,
but reference is made to the actual documents for complete information. All such summaries are qualified in their
entirety by such reference. Copies of documents referred to herein will be made available to prospective investors (1)
upon request to CODELCO or the initial purchasers and (ii) at the office of the paying agent.

IN CONNECTION WITH THIS OFFERING, BOFA SECURITIES, INC., J.P. MORGAN
SECURITIES LLC, MIZUHO SECURITIES USA LLC, SCOTIA CAPITAL (USA) INC., OR ANY
PERSON ACTING FOR ANY OF THEM, MAY OVER-ALLOT OR EFFECT TRANSACTIONS WITH A
VIEW TO SUPPORTING THE MARKET PRICE OF THE NOTES AT A LEVEL HIGHER THAN THAT
WHICH MIGHT OTHERWISE PREVAIL FOR A LIMITED PERIOD AFTER THE ISSUE DATE.
HOWEVER, THERE IS NO OBLIGATION FOR BOFA SECURITIES, INC., J.P. MORGAN SECURITIES
LLC, MIZUHO SECURITIES USA LLC, SCOTIA CAPITAL (USA) INC., OR ANY PERSON ACTING
FOR ANY OF THEM, TO DO THIS. SUCH STABILIZING, IF COMMENCED, MAY BE
DISCONTINUED AT ANY TIME, AND MUST BE BROUGHT TO AN END AFTER A LIMITED
PERIOD.

You must: (i) comply with all applicable laws and regulations in force in any jurisdiction in connection
with the possession or distribution of this offering memorandum and the purchase, offer or sale of the notes; and
(ii) obtain any consent, approval or permission required to be obtained by you for the purchase, offer or sale by you
of the notes under the laws and regulations applicable to you in force in any jurisdiction to which you are subject or
in which you make such purchases, offers or sales; neither we nor the initial purchasers shall have any responsibility
therefor.

The notes are subject to restrictions on resale and transfer as described under “Transfer Restrictions.” By
purchasing the notes, you will be deemed to have made certain acknowledgments, representations and agreements as
described under “Transfer Restrictions.” You may be required to bear the financial risks of investing in the notes for
an indefinite period of time.

The price and amount of the notes to be issued under the offering memorandum will be determined by the
Issuer and the initial purchasers at the time of issue in accordance with prevailing market conditions.

You acknowledge that:
e you have been afforded an opportunity to request from us, and to review, all additional information

considered by you to be necessary to verify the accuracy of, or to supplement, the information contained in
this offering memorandum;

ii
e you have not relied on the initial purchasers or any person affiliated with the initial purchasers in
connection with your investigation of the accuracy of such information or your investment decision;

e you have made your own assessment concerning the relevant tax, legal, currency and other considerations
relevant to investment in the notes;

* you have sufficient knowledge and experience to be capable of evaluating the merits and risks of a
prospective investment in the notes; and

* no person has been authorized to give any information or to make any representation concerning us or the
notes, other than as contained in this offering memorandum and, if given or made, any such other
information or representation should not be relied upon as having been authorized by us or the initial
purchasers.

This offering memorandum is for distribution only to persons who (i) have professional experience in
matters relating to investments falling within Article 19(5) of the Financial Services and Markets Act 2000
(Financial Promotion) Order 2005 (the “Order”), (ii) are persons falling within Article 49(2)(a) to (d) (“high net
worth companies, unincorporated associations etc.”) of the Order, (iii) are outside the United Kingdom (the “UK”»,
or (iv) are persons to whom an invitation or inducement to engage in investment activity (within the meaning of
section 21 of the Financial Services and Markets Act 2000) in connection with the issue or sale of any securities
may otherwise lawfully be communicated (all such persons together being referred to as “relevant persons”). This
offering memorandum is directed only at relevant persons and must not be acted on or relied on by persons who are
not relevant persons. Any investment or investment activity to which this offering memorandum relates is available
only to and will be engaged in only with relevant persons. Any person who is not a relevant person should not act or
rely on this offering memorandum or any of its contents.

The notes are not intended to be offered, sold, or otherwise made available to and should not be offered,
sold or otherwise made available to any retail investor in the European Economic Area (“EEA”) or in the UK. For
these purposes, a retail investor means a person who is one (or more) of: (i) a retail client as defined in point (11) of
Article 4(1) of Directive 2014/65/EU (as amended, “MiFID II”); or (ii) a customer within the meaning of Directive
(EU) 2016/97 (as amended, the “Insurance Distribution Directive”), where the customer would not qualify as a
professional client as defined in point (10) of Article 4(1) of MiFID IL. Consequently, no key information document
required by Regulation (EU) No 1286/2014 (as amended, the “PRIIPs Regulation”) for offering or selling the notes
or otherwise making them available to retail investors in the EEA or in the UK, has been prepared and therefore the
offering or selling of the notes or otherwise making them available to any retail investor in the EEA or in the UK
may be unlawful under the PRIIPs Regulation.

See “Risk Factors” beginning on page 16 for a description of certain risks you should consider before
investing in the notes.

li
NOTE REGARDING FORWARD-LOOKING STATEMENTS

This offering memorandum contains forward-looking statements. We may from time to time make
forward-looking statements in (i) our annual report; (ii) prospectuses, press releases and other written materials; or
(iii) oral statements made by our officers, directors or employees to analysts, institutional investors, representatives
of the media and others. Examples of these forward-looking statements include:

* projections of revenues, profit (loss), capital expenditures, dividends, capital structure or other
financial items or ratios;

e statements of our plans, objectives or goals, including those relating to anticipated trends, competition,
regulation and rates;

+. statements about our future economic performance or that of Chile or other countries in which we have
investments; and

+. statements of assumptions underlying these statements.

” ” « ” < ”» oc Words such as “believe,” “could,” “may,” “will,” “anticipate,” “plan,” “expect,” “intend,” “target,”
“estimate,” “project,” “potential,” “guideline,” “should” and similar expressions are intended to identify
forward-looking statements, but are not the exclusive means of identifying these statements.

Forward-looking statements involve inherent risks and uncertainties. We caution you that a number of
important factors could cause actual results to differ materially from the plans, objectives, expectations, estimates
and intentions expressed in these forward-looking statements. These factors, some of which are discussed under
“Risk Factors,” include economic and political conditions and government policies in Chile or elsewhere, inflation
rates, exchange rates, regulatory developments and changes in Chilean law, customer demand, competition,
unanticipated mining and production problems, commodity prices, relations with employees and contractors,
variances in ore grade, adverse weather conditions, natural disasters and the duration and severity of the recent
outbreak of coronavirus (“COVID-19”) and its potential impact on our business. We caution you that the foregoing
list of factors is not exclusive and that other risks and uncertainties may cause actual results to differ materially from
those in forward-looking statements.

You are cautioned not to place undue reliance on these forward-looking statements which reflect our views
only as of the date they are made, and we do not undertake any obligation to update them or publicly to release the
result of any revisions to these forward-looking statements in light of new information or future developments after
the date of this offering memorandum.

lv
ENFORCEABILITY OF CIVIL LIABILITIES

CODELCO is a state-owned enterprise organized under the laws of Chile. All of its directors and executive
officers and certain experts named in this offering memorandum reside outside the United States (principally in
Chile), and all or a substantial portion of the assets of CODELCO and of such persons are located outside the United
States. As a result, it may not be possible for investors to effect service of process within the United States on, or
bring actions or enforce foreign judgments against, CODELCO or such persons in U.S. courts. In addition,
CODELCO has been advised by its Chilean counsel, Carey y Cía. Ltda., that no treaty exists between the United
States and Chile for the reciprocal enforcement of foreign judgments. There is also doubt as to the enforceability in
Chilean courts of judgments of U.S. courts obtained in actions predicated upon the civil liability provisions of U.S.
federal securities laws. Chilean courts, however, have enforced judgments rendered in the United States by virtue of
the legal principles of reciprocity and comity, subject to the review in Chile of the U.S. judgment in order to
ascertain whether certain basic principles of due process and public policy have been respected, without reviewing
the merits of the subject matter of the case. Lastly, CODELCO has been advised by Carey y Cía. Ltda. that there is
doubt as to the enforceability in original actions in Chilean courts of liabilities predicated solely upon U.S. federal
securities laws.

The notes, the indenture and the purchase agreement will provide that CODELCO will appoint the
Chilean consul in New York City as its agent upon whom process may be served in any action arising out of or
based upon, respectively, the notes, the indenture, the purchase agreement or the transactions contemplated thereby,
which may be instituted in any federal or state court having “subject matter” jurisdiction. See “Description of
Notes.”

Pursuant to the Chilean Mining Code, mining concessions as well as certain raw materials and other
property or assets permanently dedicated to the exploration or extraction of minerals cannot be subject to an order of
attachment, except with respect to mortgages, in the case that the debtor consents to the attachment in the same
enforcement proceeding or when the debtor is a stock corporation. In addition, pursuant to the Chilean constitution
(the “Constitution”), mining concessions corresponding to mining deposits exploited by CODELCO upon its
creation in 1976 cannot be subject to attachment nor to any act of disposition by CODELCO. As a result, the rights
of holders to attach property of CODELCO in the event of a default under the notes would be limited by such
provisions. See “Regulatory Framework—Mining Regulations.”
PRESENTATION OF FINANCIAL AND STATISTICAL INFORMATION

In this offering memorandum, references to “U.S.$,” “$,” “U.S. dollars” and “dollars” are to United States
dollars and references to “cents” are to United States cents (U.S.$0.01). References to “pesos” or “Ch$” are to
Chilean pesos and references to “UF” are to “Unidades de Fomento.” References to “AUD” are to Australian
dollars. References to “HKD” are to Hong Kong dollars. The UF is an inflation-indexed Chilean monetary unit that
is linked to, and adjusted daily to reflect changes in, the Chilean consumer price index during the preceding 30 days.
References to “euro” or “E” are to the legal currency of the European Economic and Monetary Union.

Pursuant to Circular N* 368 (Oficio Circular N* 368) of October 2006, as amended, of the Comisión para
el Mercado Financiero (the Chilean securities authority, or “CMF”), since 2010, all companies with publicly traded
securities in Chile have been required to prepare and report consolidated financial statements in accordance with
International Financial Reporting Standards (“IFRS”) issued by the International Accounting Standards Board
(IASB”).

The audited consolidated financial statements as of and for the years ended December 31, 2017 and 2018
and the audited consolidated financial statements as of and for the years ended December 31, 2018 and 2019
included herein are referred to as the “2017-2018 Consolidated Financial Statements” and the “2018-2019
Consolidated Financial Statements,” respectively. The 2017-2018 Consolidated Financial Statements and the
2018-2019 Consolidated Financial Statements (together, the “Audited Annual Consolidated Financial Statements”)
are presented in accordance with IFRS issued by the IASB.

The unaudited interim consolidated financial statements as of September 30, 2020 and for the nine-month
periods ended September 30, 2019 and 2020 included herein (the “Unaudited Interim Consolidated Financial
Statements”) are presented in accordance with IAS 34 “Interim Financial Reporting.” The Unaudited Interim
Consolidated Financial Statements and the Audited Annual Consolidated Financial Statements are referred to
together as the “Consolidated Financial Statements.”

The accounting policies adopted in the preparation of the Unaudited Interim Consolidated Financial
Statements are consistent with those applied in the preparation of the 2018-2019 Consolidated Financial Statements.

Unless otherwise indicated, the Consolidated Financial Statements and other financial information
concerning CODELCO included herein are presented in U.S. dollars in conformity with Decree Law 1,350 of 1976,
as amended by Law 20,392 published in the Diario Oficial de la República de Chile (the “Official Gazette”) on
November 14, 2009, and for periods after January, 1, 2009, in accordance with IFRS. Decree Law 1,350 is the
Chilean law pursuant to which CODELCO was created and which provides for its governance.

Because the notes offered hereby have not been and will not be registered with the SEC, this offering
memorandum does not and is not required to comply with the applicable requirements of the Securities Act, and the
related rules and regulations adopted by the SEC, which would apply if the notes offered hereby were being
registered with the SEC.

The U.S. dollar is the currency used in the primary economic environment in which CODELCO operates.
Nevertheless, as an international company operating primarily in Chile, as well as in several other Latin American
countries, several European countries and China, a portion of CODELCO”s business is transacted in Chilean pesos
and other non-dollar currencies.

The body of generally accepted accounting principles is commonly referred to as “GAAP.” A non-GAAP
financial measure is generally defined by the SEC as one that purports to measure historical or future financial
performance, financial position or cash flows but: (i) excludes amounts, or is subject to adjustments that have the
effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in
accordance with GAAP in the issuer”s statement of income, balance sheet or statement of cash flows (or equivalent
statements); or (11) includes amounts, or is subject to adjustments that have the effect of including amounts, that are
excluded from the most directly comparable measure so calculated and presented.

vi
In this offering memorandum, CODELCO discloses several non-GAAP financial measures, including
“Adjusted EBIT,” “Adjusted EBITDA,” “cash cost,” “total costs and expenses” and “financial debt.” Adjusted EBIT
is calculated by adding finance cost, impairment charges and income tax expense to profit (loss) for the period.
Adjusted EBITDA is calculated by adding finance cost, income tax expense, depreciation and amortization of assets
plus export taxes and impairment charges to profit (loss) for the period. Impairments include charges and reversals
related to charges of investment projects, research projects and investment in associates and joint ventures and
exclude impairment charges related to definitely-lived tangible assets which show indicators of impairment under
International Accounting Standard N* 36. Cash cost is calculated in accordance with the methodology specified by
Brook Hunt $ Associates for the determination of Cl cost (cash cost) and includes all direct cash costs of mining,
including costs associated with extraction, leaching, smelting and further processing of copper ores into refined
metal, as well as labor, electricity, diesel, finance costs, third-party services, other costs, transportation and physical
plant costs associated with those processes, net of income from sales of byproducts. Cash cost is presented as a
nominal dollar amount, usually expressed as cents per pound, and excludes provisions, amortization, depreciation
and central office costs. Financial debt is calculated as loans from financial institutions plus bonds issued. Total debt
to capitalization includes total financial debt divided by total financial debt plus total equity.

Adjusted EBIT and Adjusted EBITDA data are included in this offering memorandum because such data
are used by investors to assess: (1) the operating trends and financial performance of the Company and (ii) the ability
of the Company to (a) service its existing debt, (b) incur new debt and (c) fund its capital expenditures.

CODELCO believes that Adjusted EBIT and Adjusted EBITDA, while providing useful information,
should not be considered in isolation or as a substitute for profit for the period as an indicator of operating
performance or as an alternative to cash flow as a measure of liquidity. Adjusted EBIT and Adjusted EBITDA are
not measures of financial performance in accordance with IFRS. Additionally, CODELCO*s calculation of Adjusted
EBIT and Adjusted EBITDA may differ from the calculation used by other companies and, therefore, comparability
may be affected.

Cash cost is disclosed in this offering memorandum because it is a widely used measure of costs in the
mining industry. CODELCO believes that cash cost, while providing useful information, should not be considered in
isolation or as a substitute for cost of sales, cost of selling and administrative expenses or as an indicator of costs.
Cash cost is not a measure of financial performance in accordance with IFRS.

CODELCO also presents certain ratios and margins that are derived using Adjusted EBITDA, including the
ratio of debt to Adjusted EBITDA, the Adjusted EBITDA coverage ratio and earnings to fixed charges (adjusted).
CODELCO believes that these ratios are widely used by investors to measure our performance. In the section titled
“Summary Consolidated Financial Data,” CODELCO provides a reconciliation of Adjusted EBIT and Adjusted
EBITDA to profit, along with the ratio of debt to Adjusted EBITDA, Adjusted EBITDA coverage ratios and ratio of
earnings to fixed charges (adjusted), for the relevant periods.

Under the accounting policies adopted by CODELCO, gross profit is calculated before the provision for a
10% special export tax. Under Law N* 13,196 (the “Copper Reserve Law”), CODELCO is required to pay a special
export tax on the sales revenues that CODELCO derives from the export of copper sourced and related byproducts
produced by CODELCO. In addition, CODELCO is subject to a mining tax at progressive rates of between 5% and
14% in accordance with Law N* 20,026. These taxes are included in “other expenses” by function. See “Risk
Factors—Risks Relating to CODELCO”s Relationship with the Government of Chile—CODELCO is subject to
special taxes” for additional information on these special taxes, including the mining tax rate effective for 2017,
2018 and 2019.

Certain figures included in this offering memorandum and in the Consolidated Financial Statements have
been rounded for ease of presentation. Percentage figures included in this offering memorandum have in some cases
been calculated on the basis of such figures prior to rounding. For this reason, certain percentage amounts in this
offering memorandum may vary from those obtained by performing the same calculations using the figures in the
Consolidated Financial Statements. Certain other amounts that appear in this offering memorandum may not sum
due to rounding.

vii
The Observed Exchange Rate (as defined herein under “Exchange Rates”) reported by the Central Bank of
Chile (1) as of January 2, 2018 was Ch$614.75 = U.S.$1.00; (ii) as of January 2, 2019 was Ch$694.77 = U.S.$1.00;
(1ii) as of September 30, 2019 was Ch$725.68 = U.S.$1.00; (iv) as of January 2, 2020 was Ch$748.74 = U.S.$1.00
and (v) as of September 30, 2020 was Ch$784.46 = U.S.$1.00. The Federal Reserve Bank of New York does not
report a noon buying rate for Chilean pesos. See “Exchange Rates.”

In this offering memorandum, all tonnage information is expressed in metric tons and all references to
ounces are to troy ounces, in each case, unless otherwise specified. Except where otherwise noted, tonnage
information in this offering memorandum does not include: (i) CODELCO”s 49% direct share of the El Abra
deposit, which is mined by Sociedad Contractual Minera El Abra and 51% owned by Cyprus El Abra Corporation, a
subsidiary of Freeport-McMoRan Inc., or (ii) CODELCO”s 20% share of Anglo American Sur S.A. (“Anglo
American Sur”), unless otherwise specified. See “Business and Properties—Copper Production—Associations, Joint
Ventures and Partnerships—SCM El Abra” and “—Anglo American Sur” for a description of these interests.
Certain terms relating to the copper mining business are defined in “Glossary of Certain Mining Terms.”

Market information regarding CODELCO*s share of copper production, reserves and relative cost position
has been derived by CODELCO from third-party sources, including reports from Brook Hunt £ Associates, and
from CODELCO”s own industry research. Brook Hunt 8 Associates publishes periodic reports containing global
copper production data and cost analysis by mine site. While CODELCO believes that its estimates are reliable, such
estimates have not been confirmed by independent sources. The Consolidated Financial Statements do not
necessarily reflect the value of CODELCO”s mining concessions or its resources and reserves. Fair value of mining
properties acquired through business combinations is reflected in the Consolidated Financial Statements when
acquired.

As used in this offering memorandum, “Chuquicamata,” “Radomiro Tomic,” “Gabriela Mistral,”
“El Teniente,” “Andina,” “Salvador,” “Mina Ministro Hales” and “Ventanas” refer to divisions of CODELCO, not

the mines having those names, unless otherwise required by context.

As used in this offering memorandum, the term “billion” means one thousand million (1,000,000,000).

viii

SUMMARY

This summary must be read as an introduction to this offering memorandum and any decision to invest in the
notes should be based on a consideration of the offering memorandum as a whole.

The following summary is qualified in its entirety by the more detailed information and financial statements
appearing elsewhere in this offering memorandum. Except as otherwise disclosed herein or indicated, financial
information with respect to CODELCO provided in this offering memorandum has been presented in U.S. dollars and
prepared in accordance with IFRS.

CODELCO is the world’s largest copper producer and one of the largest companies in Chile in terms of
revenues (U.S.$12.5 billion in 2019). As of December 31, 2019, CODELCO*s total assets were U.S.$40.3 billion and
equity amounted to U.S.$11.6 billion. As of September 30, 2020, CODELCOS*s total assets were U.S.$42.4 billion and
equity amounted to U.S.$11.7 billion.

CODELCO engages primarily in the exploration, development and extraction of ores bearing copper and
byproducts, the processing of ore into refined copper and the international sale of refined copper and byproducts.
CODELCO is 100% owned by the Government of Chile and controls approximately 6% of the world”s proved and
probable copper reserves, as such terms are defined by the U.S. Geological Survey.

In 2019, CODELCO had an estimated 8.1% share of total world copper production, with production
amounting to approximately 1.71 million metric tons, including: (i) CODELCO”s share of the El Abra deposit, which is
mined by Sociedad Contractual Minera El Abra and owned 49% by CODELCO and 51% by Cyprus El Abra
Corporation (a subsidiary of Freeport-McMoRan Inc.); and (ii) CODELCO*s share of Anglo American Sur (of which
CODELCO owns a 20% indirect share), and an estimated 8% share of the world”s molybdenum production, with
production amounting to approximately 22,353 metric tons excluding CODELCO*s share of Anglo American Sur.

CODELCO”s main commercial product is Grade A cathode copper. In 2019 and in the first nine months of
2020, CODELCO derived 91% of its total sales from copper and 9% of its total sales from byproducts of its copper
production.

CODELCOS*s sales of copper in 2019 were geographically diversified, with approximately 49% of sales made
to Asia, including approximately 35% to China, as well as approximately 37% to North and South America and 13% to
Europe. CODELCOSs top ten customers purchased approximately 41.5% ofits total copper sales volume in 2019.

CODELCOSs copper operations are divided into the following eight divisions:

+ TheEl Teniente Division operates the El Teniente mine, which is the world”s largest underground copper mine and
has been in operation for more than 100 years. The El Teniente Division includes the Caletones smelter. In 2019,
this division produced 459,744 metric tons of copper, or 26.9% of CODELCO”s total copper output (including
CODELCOSs share of the El Abra deposit and Anglo American Sur), with a cash cost of 100.7 cents per pound,
compared to 106.5 cents per pound in 2018, and a total cash cost of U.S.$1.0 billion in 2019, compared to U.S.$1.1
billion in 2018. During the first nine months of 2020, this division produced 312,961 metric tons of copper with a
cash cost of 102.4 cents per pound and a total cash cost of U.S.$699 million.

e The Radomiro Tomic Division operates the Radomiro Tomic mine, which began its first full year of production in
1998 and ranked among the world”s top three largest producers of copper using SX-EW technology in 2018. In
2019, this division produced 266,415 metric tons of copper cathodes, or 15.6% of CODELCOSs total copper output
(including CODELCOS”s share of the El Abra deposit and Anglo American Sur), with a cash cost of 154.3 cents per
pound, compared to 134.1 cents per pound in 2018, and a total cash cost of U.S.$901 million in 2019 compared to
U.S.$973 million in 2018. During the first nine months of 2020, this division produced 182,068 metric tons of
copper with a cash cost of 144.7 cents per pound and a total cash cost of U.S.$577 million.

e The Chuquicamata Division operates the Chuquicamata mine, one of the largest copper-producing mines in the
world, which began its operations in 1915 and currently includes smelting and refining capacities. In 2019, this

division produced 385,309 metric tons of copper cathodes, or 22.6% of CODELCO’s total copper output
(including CODELCOS”s share of the El Abra deposit and Anglo American Sur), with a cash cost of 120.5 cents per
pound, compared to 131.5 cents per pound in 2018, and a total cash cost of U.S.$996 million in 2019, compared to
U.S.$908 million in 2018. During the first nine months of 2020, this division produced 299,752 metric tons of
copper with a cash cost of 104.7 cents per pound and a total cash cost of U.S.$675 million.

+ The Mina Ministro Hales Division was created in 2010 for the operation of the Mina Ministro Hales ore body,
which first began producing copper at the end of 2013. In 2019, this division produced 151,838 metric tons of
copper, or 8.9% of CODELCO’s total copper output (including CODELCO”s share of the El Abra deposit and
Anglo American Sur), with a cash cost of 123.6 cents per pound, compared to 124.0 cents per pound in 2018, and a
total cash cost of U.S.$400 million in 2019, compared to U.S.$517 million in 2018. During the first nine months of
2020, this division produced 112,801 metric tons of copper with a cash cost of 116.5 cents per pound and a total
cash cost of U.S.$280 million.

e The Andina Division operates the Andina and Sur-Sur mines with production split among open-pit and
underground mines. It does not have independent smelting capacity. Andina has been in operation since 1970. In
2019, this division produced 170,274 metric tons of copper, or 10.0% of CODELCO’s total copper output
(including CODELCOS”s share of the El Abra deposit and Anglo American Sur), with a cash cost of 184.6 cents per
pound, compared to 163.7 cents per pound in 2018, and a total cash cost of U.S.$669 million in 2019, compared to
U.S.$682 million in 2018. During the first nine months of 2020, this division produced 142,334 metric tons of
copper with a cash cost of 145.9 cents per pound and a total cash cost of U.S.$442 million.

e The Gabriela Mistral Division was created in 2013 and operates the Gabriela Mistral mine, which uses SX-EW
technology. The Gabriela Mistral mine produced its first copper cathodes in 2008 after a 26-month construction
period. In 2019, this division produced 104,087 metric tons of copper, or 6.1% of CODELCO*s total copper output
(including CODELCOS”s share of the El Abra deposit and Anglo American Sur), with a cash cost of 231.8 cents per
pound, compared to 191.9 cents per pound in 2018, and a total cash cost of U.S.$532 million in 2019, compared to
U.S.$454 million in 2018. During the first nine months of 2020, this division produced 74,226 metric tons of
copper with a cash cost of 188.0 cents per pound and a total cash cost of U.S.$308 million.

e The Salvador Division operates the Salvador mine and concentrator and the smelter/refinery complex at Potrerillos,
which has the capacity to treat 671,000 metric tons of concentrate. In 2019, this division produced 50,561 metric
tons of copper cathodes, or 3.0% of CODELCOS”s total copper output (including CODELCO”s share of the El Abra
deposit and Anglo American Sur), with a cash cost of 232.7 cents per pound, compared to 223.5 cents per pound in
2018, and a total cash cost of U.S.$257 million in 2019, compared to U.S.$296 million in 2018. During the first
nine months of 2020, this division produced 40,935 metric tons of copper with a cash cost of 199.8 cents per pound
and a total cash cost of U.S.$179 million. Unless the Inca Pit project (as described below) enters the execution
stage, CODELCO”s Board of Directors has decided to phase out mining operations at the Salvador mine by the end
of 2021, or sooner, if warranted by market and operational conditions, specifically marketability of its copper, cash
costs and annual reviews of performance. The Potrerillos smelter and refinery would continue to operate upon any
cessation of the mining operations at Salvador.

e The Ventanas Division was created in connection with the acquisition of the Ventanas smelter/refinery complex
from Chile”s state-owned mining company Empresa Nacional de Minería (“ENAMT”) in 2005. In 2019, this
division refined 376,400 metric tons of copper, compared to 409,049 metric tons of copper in 2018. During the first
nine months of 2020, the Ventanas division refined 302,500 metric tons of copper. Pursuant to the terms of the
acquisition, CODELCO is required to provide on market terms the necessary smelting and refining capacity for the
treatment of copper concentrate delivered by the small- and medium-sized mining industry that ENAMI serves.

The Chuquicamata Division, the Radomiro Tomic Division, the Mina Ministro Hales Division and the Salvador
Division form part of CODELCO”s Northern Operations (Operaciones Norte). The Andina Division, the El Teniente
Division and the Ventanas Division form part of CODELCO”s Central Southern Operations (Operaciones Centro Sur).
For a description of CODELCO’s associations with other companies, see “Business and Properties—Copper
Production—Associations, Joint Ventures and Partnerships.”

Competitive Strengths

CODELCO believes that it has certain distinguishing competitive strengths:

e Copper Reserves. CODELCO controls approximately 6% of the world”s proved and probable copper reserves. In
2019, CODELCO”s proved and probable reserves represented at least 29 years of future production at current
levels.

e Market Presence. CODELCO is the largest copper producer in the world, with an estimated 8.1% share of the total
world copper production and 1.7 million metric tons (including CODELCO”s share of the El Abra deposit and
Anglo American Sur) of production in 2019. CODELCO is also one of the largest producers of molybdenum in the
world, with an estimated 8% share of total world molybdenum production, producing 22,353 metric tons in 2019
(excluding CODELCO”s share of Anglo American Sur). CODELCO believes that its significant market presence
gives the Company certain advantages in the marketing of its products.

e Lower Cost Producer. For many years, CODELCO has been within the first or second quartiles in the industry
with respect to costs. This position is primarily attributable to the quality of its ore bodies, its economies of scale
and the experience of its workforce and management. Currently, CODELCO is in the third quartile of the
industry”s cost curve. The Company intends to make every effort, through investment and management, to be
within the first or second quartiles of the industry?s cost curve in the long-term. In 2019, CODELCO*s total costs
and expenses decreased by 11.6 cents per pound (4.7%) to 233.5 cents per pound, compared to 245.1 cents per
pound in 2018 and 227.1 cents per pound in 2017, mainly due to depreciation of the Chilean peso against the U.S.
Dollar, cost savings in maintenance expenses and lower labor expenses, partially offset by lower production levels
in connection with weather disruptions in the northern area of Chile, a 14-day strike at the Chuquicamata mine and
upgrades at the Chuquicamata and Salvador smelters that suspended operations temporarily. For the first nine
months of 2020, CODELCOS*s total costs and expenses decreased by 11.3 cents per pound (4.7%) to 228.3 cents
per pound, compared to 239.7 cents per pound for the same period in 2019, mainly due to lower input prices, such
as electricity and diesel, depreciation of the Chilean peso against the U.S. Dollar and higher production volume. In
2019, CODELCOSs total costs and expenses decreased to U.S.$8.2 billion, compared to U.S.$9.1 billion in 2018,
due to depreciation of the Chilean peso against the U.S. Dollar and a decline of sales volume and cost cutting
initiatives. In 2018, CODELCO*s total costs and expenses increased by 4.4% to U.S.$9.1 billion, compared to
U.S.$8.7 billion in 2017 mainly due to the appreciation of the Chilean peso against the U.S. dollar, as well as
higher input prices, non-cash charges related to the write-off of an innovation project for underground mining and
impairment losses on fixed assets associated with the Ventanas Division. For the first nine months of 2020,
CODELCOS*s total costs and expenses amounted to U.S.$5.9 billion, which was relatively flat as compared to the
same period of 2019. Higher depreciation and amortization expenses and finance costs partially offset the favorable
effect on total costs and expenses from the depreciation of the Chilean peso against the U.S. Dollar and the lower
input prices. In 2019, CODELCO”s cash cost of production was 141.6 cents per pound, compared to 139.1 cents
per pound in 2018 and 135.9 cents per pound in 2017. For the first nine months of 2020, CODELCO”s cash cost of
production was 126.9 cents per pound, compared to 143.1 cents per pound for the same period in 2019. In 2019,
CODELCOSS total cash cost was U.S.$4.9 billion, compared to U.S.$5.1 billion in 2018 and U.S.$5.1 billion in
2017. For the first nine months of 2020, CODELCO’s total cash cost was U.S.$3.2 billion, as compared to
U.S.$3.5 billion for the same period in 2019 (such total cash cost includes certain cash cost incurred at the
corporate level). See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—
Overview.”

e Research and Technological Innovation. CODELCO remains competitive by developing and incorporating new
technologies into its production processes, which aim to improve overall operations, including mining processes,
efficiency, productivity, environmental protection and worker safety.

e Stable, Long-term and Geographically Diverse Customer Base. CODELCO has developed long-term relationships
with the majority of its customers, including some of the leading manufacturers in the world.

e Financial Strength. In 2019, CODELCO”s Adjusted EBITDA amounted to U.S.$4.0 billion, total debt to
capitalization as of December 31, 2019 was 59.7%, and the ratio of total debt to Adjusted EBITDA was 4.3. As of

September 30, 2020, Adjusted EBITDA amounted to U.S.$3.4 billion, total debt to capitalization was 62.6%.

e Management Efficiency and Flexibility. CODELCO believes that it has a highly experienced workforce and
executive team with a proven track record of managing long-life copper reserves that is able to respond to market
changes by adjusting the allocation of its resources and operations among several different methods of production
and ore deposits.

e Oneofthe Leading Companies in Chile. CODELCO is one of the largest companies in Chile in terms of revenues
as of December 31, 2019 (U.S.$12.5 billion) and is a key contributor to the budget of the Government of Chile. In
2019, CODELCO contributed U.S.$1.0 billion to the Chilean Treasury and accounted for approximately 13.4% of
Chile”s total exports. See “Management’s Discussion and Analysis of Financial Condition and Results of
Operations—Liquidity and Capital Resources—Distributions to the Chilean Treasury” and “Regulatory
Framework.”

Business Strategy

CODELCOS*s mission is to maximize the value of its mineral resources for the benefit of its shareholder, the
Chilean state, by fully developing its vast mining resources on a timely basis, leveraging the Company”s experienced
workforce, utilizing its advanced technological assets in key areas and by executing the following key strategic
initiatives:

e Capital Expenditure Program. We seek to maintain and improve our competitive position in the industry through
our three-year capital expenditure program. Following the completion of a number of significant projects in recent
years, such as the development of CODELCO”s new Mina Ministro Hales, the development of sulfide ores at the
Radomiro Tomic mine, the expansion at the Andina mine and the development of the Pilar Norte area at the El
Teniente mine, CODELCO intends to continue its development program. Accordingly, the Company expects to
make capital expenditures of approximately U.S.$12.5 billion between 2020 and 2022 on major projects,
transforming its main mining operations with a view towards the long-term development of its resources. We
expect these expenditures to be funded with a combination of internal and external resources. For a complete list of
planned capital expenditures, see “Business and Properties—Copper Production—Operations.” CODELCO”s
expansion and development of major projects between 2020 and 2022 are expected to include:

o The gradual transformation of the Chuquicamata mine from an open pit mine to an underground operation,
which we expect will enable Chuquicamata to maintain its annual copper production at its current level
starting in 2019 (an approximate investment of U.S.$1.4 billion between 2020 and 2022). Environmental
approvals were obtained in September 2010. On March 25, 2020 and on June 20, 2020, CODELCO
announced the temporary suspension of construction of this project as a measure to prevent the spread of
COVID-19 among employees and contractors. In August 2020, work on the project gradually resumed, and
as of September 30, 2020, the project was approximately 99.5% complete.

o The reallocation of the Andina plant, which involves maintaining the treatment capacity of the concentrator
plant in the long-term (an approximate investment of U.S.$172 million between 2020 and 2022). In March
2020, CODELCO announced the temporary suspension of this project as a measure to prevent the spread of
COVID-19 among employees and contractors. The project is currently under construction, and as of
September 30, 2020, the project was approximately 89.1% complete. Operations are expected to begin in
2021.

o The development of a new production level in the existing El Teniente underground mine (an approximate
investment of U.S.$2.0 billion between 2020 and 2022) to maintain El Teniente”s annual copper production
at its current level. Environmental approvals were obtained in March2011. However, based on
geomechanical challenges that need to be addressed, an alternative development plan was approved in
January 2018, which will still permit us to maintain our original production goal. The new mining level is
expected to be completed in 2023. As of September 30, 2020, the project was approximately 62.6%
complete.

o The development of the Inca Pit project is designed to extend the life of the current underground mine
operation in the Salvador Division and enable it to maintain its annual production at its current level starting
in 2021 and the analysis for a future expansion, which requires an approximate investment of U.S.$1.2
billion between 2020 and 2022. As of September 30, 2020, the feasibility study, mining development
activities and early works had already been completed. Final internal approval to begin the development of
this project has been postponed pending approval by the Environmental Court of the settlement agreement
between the State Defense Council (Consejo de Defensa del Estado) and CODELCO. For further
information regarding this settlement see “Business and Properties—Legal Proceedings.”

o The expansion of the existing Andina open pit is an initiative that is expected to expand the treatment
capacity of the concentrator plant up to 150 thousand tons per day (an approximate investment of U.S.$80
million between 2020 and 2022) starting in 2027. As of September 30, 2020, the feasibility study had been
authorized and the project was approximately 78% complete.

e Improvement in Operations. A number of improvement initiatives are underway to adopt best industry practices,
most notably in the areas of labor productivity, asset utilization rates and process efficiency. Together with its
capital expenditure program, these initiatives are expected to enhance CODELCO”s competitive position. The
Company operates in a cyclical business and CODELCOSs strategy is to ensure that it is able to take full advantage
of high copper prices. The Company is developing a number of plans to achieve production targets in the coming
years. These plans mainly focus on reducing the risk of disruptions to production and providing increased
flexibility to its operations.

e Transformation Plan. On November 29, 2019, CODELCO announced a transformation plan with the goal of
making CODELCO a more productive, profitable and sustainable company (the “Transformation Plan”). Among
other objectives, the Transformation Plan seeks to optimize the standards for project selection and to reduce
execution delays, improve operating performance and renew focus on maximizing the value of its mineral
resources and reserves. The Transformation Plan also includes a series of targets to achieve cost savings in capital
and operational expenditures.

e Exploration Efforts. CODELCO controls the largest copper reserves worldwide, the Company”s single most
important long-term competitive advantage. The discovery of new mining resources and improving its ability to
locate existing ore bodies and prospects are critical to maintain this preeminent position in the industry.
Accordingly, the Company”s exploration program will continue to be a key part of its business strategy.

e Investment in Human Capital. The successful execution of CODELCO*s business strategy relies on attracting and
retaining a world-class management team and professionals of the highest caliber, as well as promoting a culture of
diversity and inclusion. The mining industry faces increased competition for workforce talent. As a result, the
Company intends to continue improving career development opportunities for its staff and the overall
attractiveness of CODELCO as a preferred employer.

e Mining Association with Third Parties. CODELCO seeks to continue to develop and operate assets in association
with third parties where these associations will add value to CODELCO”s business. A few examples of the
Company”s willingness and ability to do so are: (1) the association with Freeport-McMoRan Inc. in the El Abra
copper mine (CODELCO owns 49%) and (ii) the association with Anglo American plc (“Anglo American”),
Mitsui 8 Co., Ltd. (“Mitsui”) and Mitsubishi Corporation (“Mitsubishi Corporation”) in Anglo American Sur
(CODELCO owns an indirect 20% interest). CODELCO believes its large mining reserve is a strong platform from
which to establish such associations.

Recent Developments
Impact of COVID-19
The COVID-19 pandemic and the resulting economic impact have primarily contributed to a decrease in

copper prices in 2020. In the first nine months of 2020, LME copper prices averaged 265.3 cents per pound compared
to 274.0 cents per pound in the first nine months of 2019, which was attributable to the impact of the COVID-19

pandemic on the Chinese and global economies during the first nine months of 2020. CODELCO”s financial results and
prospects are largely dependent on the prices of copper. If economic conditions further deteriorate in China or other
emerging markets, demand from customers in those markets could decline and the market price of copper could fall. A
decline in copper prices would have an adverse impact on CODELCO*s revenues and financial results.

CODELCO has taken steps and implemented several measures to safeguard its employees, businesses and the
communities surrounding its operations from the threats posed by the COVID-19 pandemic. Although these steps and
measures have not materially affected CODELCO”s production or its financial results in 2020, the ultimate impact of
COVID-19 on CODELCO*s financial and operating results is unknown and will depend on the duration and spread of
the pandemic, and will not be fully reflected in CODELCOS*s results of operations until future periods.

Prepayment of Debt

On December 2, 2020, CODELCO prepaid its outstanding U.S.$300 million loan with Export Development
Canada due July 17, 2022, and its outstanding U.S.$300 million loan with Scotiabank $ Trust (Cayman) Ltd. due April
13, 2022 (collectively, the “Prepayments”).

Appointment of New Executives

On August 28, 2020, CODELCO announced the resignation of Jaime Rivera Machado from his position as
General Manager of Andina Division, effective as of September 30, 2020.

On September 25, 2020, CODELCO announced the resignation of Cesar Correa Parker from his position as
General Auditor, effective as of October 31, 2020.

On September 29, 2020, CODELCO announced the appointment of Ricardo Weishaupt Hidalgo as General
Manager of Ventanas Division, effective on November 1, 2020.

On October 2, 2020, CODELCO announced the resignation of Alvaro Aliaga Jobet, Vice President — Northern
Operations and Jose Robles Becerra, Vice President — Productivity and Costs. On the same day, CODELCO announced
the appointment of Mauricio Barraza Gallardo as acting Vice President — Northern Operations and Alejandro Rivera
Stambuck as acting Vice President — Productivity and Costs, both positions effective as of October 16, 2020. Mauricio
Barraza Gallardo and Alejandro Rivera Stambuck will also maintain their current positions as Vice President — Central
Southern Operations and Chief Financial Officer, respectively.

On October 30, 2020, CODELCO announced the appointment of Carlos Alvarado Hernández as Vice
President of Sales and Rodrigo Miranda Schleyer as acting General Auditor, both positions effective on November 1,
2020. The same day, CODELCO announced the appointment of Rodrigo Barrera Paez, former General Manager of
Mina Ministro Hales Division, as General Manager of Andina Division, and Francisco Balsebre Olaran as acting
General Manager of Mina Ministro Hales Division, both positions effective on December 1, 2020.

On November 19, 2020 CODELCO announced the appointment of Andre Sougarret as Vice President —
Northern Operations, effective on January 2, 2021.

Concurrent Tender Offer

Concurrently with this offering, we are launching the Tender Offers for the Tender Notes validly tendered and
accepted by us on or before the applicable expiration date upon the terms and subject to the conditions set forth in an
Offer to Purchase dated December 7, 2020 (as it may be amended or supplemented from time to time). We intend to use
the net proceeds from the sale of the notes (i) to pay the consideration for the Tender Offers and accrued and unpaid
interest on the Tender Notes, (ii) to pay fees and expenses incurred in connection with the Tender Offers and (iii) the
remainder, if any, for general corporate purposes. The Tender Offers are not being made pursuant to this offering
memorandum. The closing of the Tender Offers is contingent upon the closing of this offering.

Corporate Information

CODELCOSs principal executive offices are located at Huérfanos 1270, Santiago, Chile, and its telephone
number is (562) 2690-3000. CODELCO was established by Decree Law 1,350, published in the Official Gazette on
February 28, 1976, as amended by Decree Law 20,392, published in the Official Gazette on November 14, 2009.

Issuer ..

The Offering

Securities Offer c.oooccicicicicononononncncnononono roca nnonono nora ononano rn rn cnononono

¡SON

Interest

Maturity DatO..oooocccicoconononnnnnnononononnnncnonononnnonnonononn rn oaononnnn rn cnononeno

Withholding Tax…

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Corporación Nacional del Cobre de Chile.

U.S.$500,000,000 aggregate principal amount of
3.150% notes due 2051 (the “notes”).

The issue price of the notes is 99.554%.
3.150% per year.

The interest on the notes will be payable
semi-annually in arrears on January 15 and July 15 of
each year, beginning on July 15, 2021. Interest on the
notes will be calculated on the basis of a 360-day
year of twelve 30-day months. See “Description of
Notes.”

January 15, 2051.

Interest will be paid after withholding for or on
account of certain taxes imposed by Chile. Under
current Chilean law and regulations, payments of
interest to holders of the notes that are not residents
of Chile for purposes of Chilean taxation will
generally be subject to Chilean withholding tax at a
rate of 4%. Subject to specified exceptions and
limitations, CODELCO will pay Additional Amounts
(as defined in “Description of Notes—Payment of
Additional Amounts”) in respect of such withholding
tax on interest payments. See “Description of
Notes—Payment of Additional Amounts” and
“Taxation—Chilean Taxation.”

The notes are redeemable at the option of CODELCO
in whole, but not in part, at any time at the principal
amount thereof, plus accrued and unpaid interest and
any Additional Amounts due thereon if, as a result of
changes in the laws or regulations affecting Chilean
taxation, CODELCO becomes obligated to pay
Additional Amounts on interest payments on the
notes in respect of withholding or deduction of
Chilean tax at a rate in excess of 4%. See
“Description of Notes—Tax Redemption,”
“Taxation—Chilean Taxation” and “Risk Factors—
Risks Relating to the Offering.”

Optional Redempti0N….ococnccnconnnonononnnnonononncnononononnnncnoncnconcncnonono

Form and DenoMinatiOM .o.ccccnccccncnoninnnnnnnnnnnnonononononannonnnnrncnononono

Payments; TTaNSÍCTS cococciconnnnnononncnononononononnnnonono nora cnonono nn rn cnononnno

We may redeem the notes at our option, in whole or
in part, at any time and from time to time prior to the
date that is six months prior to the maturity date of
the notes, at a redemption price equal to the greater
of 100% of the outstanding principal amount of the
notes to be redeemed and a redemption price based
on a “make-whole” premium, plus accrued and
unpaid interest to the date of redemption. In addition,
we may redeem the notes at our option, in whole or
in part, at any time and from time to time, beginning
on the date that is six months prior to the maturity
date of the notes, at a redemption price equal to
100% of the outstanding principal amount of the
notes to be redeemed, plus accrued and unpaid
interest to the date of redemption. See “Description
of Notes—Optional Redemption” and “Risk
Factors—Risks Relating to the Offering.”

The notes will be issued in book-entry form only in
denominationss of U.S.$200,000 and integral
multiples of U.S.$1,000 in excess thercof. The notes
will be represented by one or more global notes (the
“Global Notes”) registered in the name of a nominee
of DTC, as depositary, for the accounts of its direct
and indirect participants, including Euroclear, as
operator of the Euroclear system, and Clearstream.
See “Description of Notes.”

Payment of interest and principal amount with
respect to interests in Global Notes will be credited
by DTC, Euroclear or Clearstream, as the case may
be, to the account of the holders of such interests
with DTC, Euroclear or Clearstream, as the case may
be. Transfers of interests in notes held through DTC,
Euroclear or Clearstream will be conducted in
accordance with the rules and operating procedures
of the relevant system. There will be a paying agent.

The notes will constitute direct, general,
unconditional and unsubordinated obligations of
CODELCO. The notes rank and will rank without
any preference among themselves and equally with
all other unsubordinated obligations of CODELCO,
other than certain obligations granted preferential
treatment pursuant to Chilean law. It is understood
that this provision will not be construed so as to
require CODELCO to make payments under the
notes ratably with payments being made under any
other obligations.

Certain CovenaNtS..ooococccccncionnccnnnonnnocnonononnnnnnonononn on ononononn rn cnononnno

Transfer Restricti0DS….ooocnnnninnnninnnnnnnnnooononanorncncnonano roca cncnanono

Further ÍSSUOS….oooinonncnnnnnnonononcononocncnononnno corn onononn roca cnonann roca cnonanono

Listing

Governing Law; Submission to JurisdictiOM…..oonicninnnninnnonn..

Expected RatidgS …cococnconnncinncononononnnncnonononononnonononnrncaononnnn cn cnononono

10

The indenture governing the notes will not contain
any restrictions on the amount of additional
indebtedness which may be incurred by CODELCO
or its subsidiaries; however, as set forth under
“Description of Notes—Covenants—Limitation on
Liens,” the notes will contain certain restrictions on
the ability of CODELCO and its subsidiaries to incur
secured indebtedness. See “Description of Notes.”

The indenture governing the notes will contain
certain covenants, including, but not limited to,
covenants with respect to (i) limitations on liens,
(ii) limitations on sale-and-lease-back transactions
and (i1i) limitations regarding consolidation, merger,
conveyance, sale or lease transactions. See
“Description of Notes—Covenants—Limitation on
Liens,” “—Limitation on Sale-and-Lease-Back
Transactions” and “—Consolidation, Merger,
Conveyance, Sale or Lease.”

“

The notes have not been and will not be registered
under the Securities Act and are subject to
restrictions on resales. See “Transfer Restrictions.”

In accordance with the terms of the indenture,
CODELCO may issue additional notes of the same
series as the notes offered hereby at a future date. See
“Description of Notes—Further Issues of Notes.”

We intend to apply to list the notes on the Official
List of the Luxembourg Stock Exchange and for
trading on the Euro MTEF market in accordance with
its rules and regulations. The notes are not yet listed.

The notes and the indenture will be governed by the
laws of the State of New York. CODELCO will
submit to the jurisdiction of the United States federal
and state courts located in the Borough of Manhattan
in the City of New York in respect of any action
arising out of or based on the notes or the indenture.
See “Description of Notes—Governing Law;
Submission to Jurisdiction; Sovereign Immunity.”

The notes offered hereby will be assigned a rating by
Moody”s Investors Service, Inc. (“Moody”s”) and by
Standard W Poor’s rating group (“S$P”). CODELCO
currently has a foreign currency long-term debt rating
by Moody”s of A3 (negative) and a long-term foreign
issuer credit rating by S£P of A (negative). A
securities rating is not a recommendation to buy, sell
or hold securities, is subject to revision or withdrawal
at any time by the assigning rating organization and
should be evaluated independently of any other
rating.

Use of Proceeds …. We intend to use the net proceeds from the sale of the
notes (i) to pay the consideration for the Tender
Offers and accrued and unpaid interest on the Tender
Notes, (ii) to pay fees and expenses incurred in
connection with the Tender Offers and (iii) the
remainder, if any, for general corporate purposes.
The Tender Offers are not being made pursuant to
this offering memorandum. The closing of the Tender
Offers is contingent upon the closing of this offering.

Trustee, Paying Agent, Transfer Agent and Registrar.. The Bank of New York Mellon.

Luxembourg Listing AYeMt ..oooiocicinnnnnnncnnncnononanoninnononano naci cncnanon The Bank of New York Mellon SA/NV, Luxembourg
Branch.
Risk Facto!IS c.ooooncicicinnconononncnnnonononoconncnonono roca nnonono roca oaonann roca cncnannno Before investing, you should carefully consider the

risks set forth under “Risk Factors” beginning on
page 16 of this offering memorandum.

11

SUMMARY CONSOLIDATED FINANCIAL DATA

The following tables present CODELCO”s summary consolidated financial data and other data as of and for
each of the periods indicated. This data (other than the average London Metal Exchange (“LME”) copper prices) is
derived from, and should be read together with, CODELCO”s Consolidated Financial Statements, including the notes
thereto, included elsewhere in this offering memorandum. This data should also be read together with “Management’s
Discussion and Analysis of Financial Condition and Results of Operations.” The Consolidated Financial Statements and
other financial information included in this offering memorandum are presented in accordance with IFRS. The unaudited
consolidated interim information as of September 30, 2020 and for the nine-month periods ended September 30, 2019
and 2020 includes all adjustments, consisting of only normal recurring adjustments. The unaudited results of operations
for the nine-month periods ended September 30, 2019 and 2020 are not necessarily indicative of the results to be
expected for the full year or any other period.

For the nine-month periods ended
For the year ended December 31, September 30,
2017 2018 2019 2019 2020
(in thousands of U-S.$)

CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME

Revenue… . $ 14,641,555 $ 14,308,758 $ 12,524,931 $ 8,808,184 $ 9,228,639
Cost of sales? (10,380,403) (11,194,341) (10,051,441) (7,256,283) (7,310,693)
Gross profit . 4,261,152 3,114,417 2,473,490 1,551,901 1,917,946
Other income, by function 154,332 124,826 360,690 206,981 75,253
Impairment loss determined in accordance

with IFRS 9 .. . N/A 158 378 1,176 (934)
Distribution co: (10,403) (18,262) (17,069) (12,647) (6,995)
Administrative expense: (428,140) (465,328) (409,234) (303,025) (262,416)
Other expenses? (1,557,473) (2,115,314) (1,747,838) (1,328,133) (969,845)
Other gain: 32,605 21,395 22,672 17,038 18,264
Finance income 29,836 51,329 36,871 22,504 35,412
Finance costs.. (644,610) (463,448) (479,307) (360,104) (520,374)
Share of profit of associates and joint ventures

accounted for using equity method 185,428 119,114 13,203 11,863 9,713
Foreign exchange differences… (206,058) 178,143 153,917 114,946 136,947
Profit (loss) for the period before tax 1,816,669 547,030 407,773 (77,500) 432,971
Income tax expenseC… (1,193,067) (357,283) (393,245) (20,499) (361,048)
Profit (loss) for the period 623,602 189,747 14,528 (97.999) 71,923
Profit (loss) attributable to owners of the paren 569,175 155,719 6,637 (105,530) 64,656
Profit (loss) attributable to non-controlling

interests 54,427 34,028 7,891 7,531 7,267
Profit (loss) for the perio 623,602 $ 189,747 $ 14,528 $ (97,999) $ 71,923
CONSOLIDATED STATEMENTS OF
FINANCIAL POSITION As of December 31
2017 2018 2019 As of September 30, 2020

(in thousands of U-S.5)

Total current assets…… aunmnnannes $ 6,211,053 $ 5,828,206 $ 6,050,021 $ 8,138,783
Total property, plant and equipment””….. 25,275,512 26,754,998 29,700,164 29,787,583
Investments accounted for using equity

method”… . 3,665,601 3,568,293 3,483,523 3,470,552
Non-current receivables 91,442 84,731 98,544 91,160
All other assetsÚ” 1,112,533 854,577 1,012,359 918,391
Total assets $ 36,356,141 $ 37,090,805 $ 40,344,611 $ 42,406,469
Total current liabiliti 3,315,456 3,539,412 3,922,957 3,217,793
Total non-current liabi 22,115,347 22,207,524 24,786,987 27,511,854
Total liabilities….. s 25,430,803 $ 25,746,936 $ 28,709,944 $ 30,729,647
Non-controlling intere: 1,007,495 969,204 919,757 919,458
Equity attributable to owners of the parent 9,917,843 10,374,665 10,714,910 10,757,364

Total equity $ 10,925,338 $ 11,343,869 $ 11,634,667 $ 11,676,822
Total liabilities and equity. s 36,356,141 $ 37,090,805 $ 40,344,611 $ 42,406,469

12

As of and for the nine months ended

OTHER ITEMS As of and for the year ended December 31, September 30,
2017 2018 2019 2019 2020
(in thousands of U.S.S, except ratios and copper prices)

Depreciation and amortization of assets ….. $ 2,101,101 $ 2,181,140 $ 2,220,069 S 1,585,427 $ 1,787,130
Interest expense, net 0. $ (614,774) $ (412,119) $ (442,436) S (337,600) S (484,962)
Ratio of earnings to fixed charges
(adjusted) O 3.8 3.0 1.9 0.8 1.8
Average LME copper price (U.S. £ per

pound)”…. 279.7 295.9 272.1 274.0 265.3
Adjusted EBITDAO Lucio. S 5,668,314 $ 4,695,792 S 4,042,748 S 2,554,746 S 3,436,711
Ratio of debt to Adjusted EBITDA” 2.6 3.2 4.3 N/A N/A
Adjusted EBITDA coverage ratio(*”… 9.2 11.4 9.1 7.6 7.1

0)

Q)

6)

(4)
(5)

“Cost of sales” for any period includes direct and indirect costs, depreciation and amortization associated with the production of copper and
byproducts, as well as purchase costs of third-party copper, sold by CODELCO in that period.

“Other expenses” is comprised principally of costs related to the 10% special export tax paid by the Company, retirement plan and severance
indemnities and fixed indirect costs below production level. See note 21.c of the Consolidated Financial Statements and “Management’s
Discussion and Analysis of Financial Condition and Results of Operations.”

CODELCO is subject to a mining tax on operating income at progressive rates of between 5% and 14%. The tax is imposed on operating
income generated during the operating year. The statutory rate of the mining tax for CODELCO was 5.0% for each year between 2017 and
2019. In addition, CODELCO is subject to the corporate income tax rate of 25% since 2017 (pursuant to the tax reform in 2014) and a 40% tax
on net earnings applicable to state-owned enterprises as specified by Decree Law 2,398, Art. 2. See “Taxation—Chilean Taxation” and
“Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Distributions to
the Chilean Treasury” for additional information. See note 5 of the Consolidated Financial Statements and “Management’s Discussion and
Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—Distributions to the Chilean Treasury” and
“Regulatory Framework.” See also “Risk Factors—Risks Relating to CODELCO”s Relationship with the Government of Chile—CODELCO is
subject to special taxes” for information regarding the mining tax rate effective in 2016.

See note 9 of the Consolidated Financial Statements and the Unaudited Interim Consolidated Financial Statements and “Management’s
Discussion and Analysis of Financial Condition and Results of Operations.”

All other assets includes other non-current financial assets, other non-current non-financial assets, accounts receivable from related parties, non-
current, non-current inventories, intangible assets other than goodwill, investment property, non-current tax assets and deferred tax assets.

(6) For the purpose of calculating CODELCOSs ratio of earnings to fixed charges (adjusted), (i) “earnings” consist of Adjusted EBIT and (ii) “fixed

(0)
(8)

(9)

(10)

charges” consist of finance cost. The ratio of earnings to fixed charges (adjusted) is calculated by dividing Adjusted EBIT by finance cost.
Adjusted EBIT is calculated by adding finance cost, impairment charges net of reversals (as defined in note (1) of the following table) and
income tax expense to profit (loss) for the period. Adjusted EBIT, while not a financial performance measure under IFRS, is presented as an
indicator of funds available to service debt. Adjusted EBIT and Adjusted EBITDA data are included in this offering memorandum because such
data are used by investors to assess: (i) the operating trends and financial performance of the Company and (ii) the ability of the Company to (a)
service its existing debt, (b) incur new debt and (c) fund its capital expenditures. The Company believes that Adjusted EBIT, while providing
useful information, should not be considered in isolation as a substitute for profit for the period, as an indicator of operating performance, or as
an alternative to cash flow as a measure of liquidity. Additionally, the Company”s calculation of Adjusted EBIT may be different than the
calculation used by other companies and therefore, comparability may be affected. See notes 8, 21 and 22 of the Consolidated Financial
Statements and Unaudited Interim Consolidated Financial Statements and “Management’s Discussion and Analysis of Financial Condition and
Results of Operations” for further information about impairment charges and reversals and other non-cash charges.

Average price on the LME for Grade A cathode copper during period.

Adjusted EBITDA is calculated by adding finance cost, income tax expense, depreciation and amortization of assets plus export taxes and
impairment charges net of reversals (as defined in note (1) of the following table) to profit (loss) for the period. Adjusted EBITDA is presented
because it is a widely accepted indicator of funds available to service debt, although it is not an IFRS-based measure of liquidity or
performance. Adjusted EBIT and Adjusted EBITDA data are included in this offering memorandum because such data are used by investors to
assess: (i) the operating trends and financial performance of the Company and (ii) the ability of the Company to (a) service its existing debt, (b)
incur new debt and (c) fund its capital expenditures. The Company believes that Adjusted EBITDA, while providing useful information, should
not be considered in isolation or as a substitute for profit as an indicator of operating performance, or as an alternative to cash flow as a measure
of liquidity. Additionally, the Company”s calculation of Adjusted EBITDA may be different than the calculation used by other companies and
therefore, comparability may be affected. See notes 8, 21 and 22 of the Consolidated Financial Statements and Unaudited Interim Consolidated
Financial Statements and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for further information
about impairment charges and reversals and other non-cash charges.

The ratio of debt to Adjusted EBITDA is calculated by dividing debt by Adjusted EBITDA. Debt is defined as loans from financial institutions
plus bonds issued.

Adjusted EBITDA coverage ratio is the ratio of Adjusted EBITDA to finance cost net of finance income. See note 9 above for further
information about Adjusted EBITDA and notes 21 and 22 of the Consolidated Financial Statements and Unaudited Interim Consolidated
Financial Statements and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for further information
about impairment charges and reversals and other non-cash charges.

(11) In the unaudited interim consolidated financial statements, as of and for the nine- and three-month periods ended September 30, 2020 and 2019,

certain reclassifications were made to the statement of financial position as of December 31, 2019 which, with respect to property, plant and

13

equipment, included a break-out of right-of-use assets into a separate line. The amounts for property, plant, and equipment in the table above,
therefore, represent the sum of property, plant and equipment and right-of-use assets.

The following table shows CODELCO’”s earnings, Adjusted EBIT, ratio of earnings to fixed charges

(adjusted), Adjusted EBITDA and reconciliation of Adjusted EBIT and Adjusted EBITDA for the periods indicated.

Profit (loss) for the period

For the nine-month periods ended
For the year ended December 31, September 30,
2017 2018 2019 2019 2020
(in thousands of U:S.$)

$ 623,602 Ss 189,747 Ss 14,528 $ (97,999) $ 71,923

Income tax expense 1,193,067 357,283 393,245 20,499 361,048
Finance costs 644,610 463,448 479,307 360,104 520,374
Impairments’ 7,378 395,965 – – –
Adjusted EBITO… 2,468,657 1,406,443 887,080 282,604 953,345
Ratio of earnings to fixed charges

(adjusted)? 3.8 3.0 1.9 0.8 1.8
Depreciation and amortization of assets” 2,101,101 2,181,140 2,220,069 1,585,427 1,787,130
Copper Reserve Law 1,098,556 1,108,209 935,599 686,715 696,296

Adjusted EBITDA

0

Q)

6)

(4)
6)

$ 5,668,314 $ 4,695,792 $ 4,042,748 S 2,554,746 S 3,436,771

Impairments include charges and reversals related to charges of investment projects, research projects and investment in associates and joint
ventures and exclude impairment charges related to definitely-lived tangible assets which show indicators of impairment under International
Accounting Standard N? 36. See notes 8, 21 and 22 of the Consolidated Financial Statements and Unaudited Interim Consolidated Financial
Statements and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for further information about
impairment charges and reversals and other non-cash charges.

Adjusted EBIT is calculated by adding finance cost, impairment charges net of reversals (as defined in note (1) above) and income tax expense
to profit (loss) for the period. Adjusted EBIT, while not a financial performance measure under IFRS, is presented as an indicator of funds
available to service debt. Adjusted EBIT and Adjusted EBITDA data are included in this offering memorandum because such data are used by
investors to assess: (i) the operating trends and financial performance of the Company and (ii) the ability of the Company to (a) service its
existing debt, (b) incur new debt and (c) fund its capital expenditures. The Company believes that Adjusted EBIT, while providing useful
information, should not be considered in isolation as a substitute for profit for the period, as an indicator of operating performance, or as an
alternative to cash flow as a measure of liquidity. Additionally, the Company”s calculation of Adjusted EBIT may be different than the
calculation used by other companies and therefore, comparability may be affected. See notes 8, 21 and 22 of the Consolidated Financial
Statements and Unaudited Interim Consolidated Financial Statements and “Management’s Discussion and Analysis of Financial Condition and
Results of Operations” for further information about impairment charges and reversals and other non-cash charges.

For the purpose of calculating CODELCOS*s ratio of earnings to fixed charges (adjusted), (i) “earnings” consist of Adjusted EBIT and (ii) “fixed
charges” consist of finance cost. The ratio of earnings to fixed charges (adjusted) is calculated by dividing Adjusted EBIT by finance cost.
See note 20 of the Consolidated Financial Statements and the Unaudited Interim Consolidated Financial Statements.

The Copper Reserve Law currently requires the payment of a 10% special export tax on receivables of the sales proceeds that CODELCO
receives and transfers to Chile from the export of copper and related by products produced by CODELCO. For further information, see “Risk
Factors— Risks Relating to CODELCO”s Relationship with the Government of Chile— CODELCO is subject to special taxes.”

14

The following table shows CODELCO”s debt and ratio of debt to Adjusted EBITDA and Adjusted EBITDA
coverage ratio for the periods indicated.

As of and for the nine-month periods

ended
As of and for the year ended December 31, September 30,
2017 2018 2019 2019 2020
(in thousands of U.S.$, except ratios)
ono $ 14,709,790 $ 15,257,685 $ 17,264,356 $ 17,453,362 $ 19,568,662
Ratio of debt to Adjusted EBITDA 2.6 3.2 43 N/A N/A
Finance income… 29,836 51,329 36,871 22,504 35,412
Adjusted EBITDA coverage ratio” 9.2 11.4 9.1 7.6 7.1

(Mm Adjusted EBITDA coverage ratio is the ratio of Adjusted EBITDA to finance cost net of finance income.

15

RISK FACTORS

Prospective purchasers of the notes offered hereby should carefully consider all of the other information
contained herein, including the risk factors set forth below. As a general matter, investing in the securities of an issuer,
substantially all of whose operations are in a developing country such as Chile, involves a higher degree of risk than
investing in securities of’issuers with substantially all of their operations in the United States and other jurisdictions.

Risks Relating to CODELCO”s Operations
Developments relating to the COVID-19 pandemic may have a material adverse impact on CODELCO*s operations.

In December 2019, the outbreak of COVID-19 began in mainland China and has since spread through most
countries, negatively affecting global and regional conditions. In March 2020, the World Health Organization (WHO)
declared the COVID-19 outbreak a pandemic. In response to the outbreak, governmental authorities throughout the
world imposed lockdowns and other restrictions to contain the virus, and various businesses suspended or reduced
operations. The final impact on the global economy and financial markets is still uncertain, but is expected to be
significant.

The COVID-19 outbreak spread into Chile and has caused temporary disruptions to some of CODELCO”s
capital projects as part of measures to contain the spread of the virus. If the pandemic continues, restrictions may be
imposed on CODELCO by governmental authorities and CODELCO may encounter operational difficulties related to
insufficient personnel, higher costs and expenses associated with delayed inspections, assessments and authorizations.
CODELCO may need to adopt additional contingency measures, such as stricter cleaning protocols and further
reductions of employees at its operations, or even suspend operations. In addition, business activities all over the world,
including manufacturing activities that drive demand for copper and other metals, declined and are expected to be
significantly impacted. The existence and continuance of the pandemic in the countries where the purchasers of
CODELCOS”s products are located could result in reduced demand. Due to the pervasive nature of the pandemic and
that its duration is not known, there is uncertainty around its ultimate impact on our business; therefore, the negative
impact on our financial and operating results cannot be reasonably estimated at this time, and CODELCO cannot rule
out a material impact in the future. The prolonged pandemic or the imposition of more restrictive measures in Chile
could result in the imposition of further quarantines or closures and/or import and export restrictions which could
further adversely affect the business, financial condition, results of operations or prospects of CODELCO. To the extent
COVID-19 adversely affects our business and financial results, it may also have the effect of heightening many of the
other risks described in this “Risk Factors” section.

CODELCO has in the past recognized significant impairment charges for certain assets and, if market and industry
conditions deteriorate, further impairment charges may be recognized.

A substantial amount of CODELCOS*s total assets are property, plant and equipment. As of December 31,
2019, 72.5% of our total assets were property, plant and equipment. In accordance with IFRS as issued by the IASB, we
review the carrying amount of our assets to determine whether there is any indication that those assets have suffered an
impairment loss. CODELCO uses the value-in-use methodology to ensure that the recoverable amount of our property,
plant and equipment is not impaired. In assessing the value-in-use, the estimated future cash flows are discounted using
a pre-tax discount rate that reflects current market assessments at the time value of money and the risks specific to the
asset.

In 2016, CODELCO recognized a U.S.$79 million impairment loss on its Anglo American Sur assets,
primarily due to the rejection of the mining plan for El Soldado, which is owned and operated by Anglo American Sur,
by the National Geological and Mining Service (Servicio Nacional de Geología y Minería, or “SERNAGEOMIN”). In
2017, the impairments charges relating to the Anglo American Sur assets were reversed in the amount of U.S.$67
million, due to the approval of the mining plan for El Soldado by the Government of Chile. In 2018, CODELCO
recognized a U.S.$199 million impairment loss in its Ventanas Division mainly due to a decrease in treatment and
refining charges, as well as the negative outlook of long-term sulfuric acid prices. In 2019, CODELCO did not
recognize an impairment loss. Because the impairment calculation is directly associated with the outlook of copper
prices, a downturn in the copper price outlook could require further impairment losses on our plant, property and
equipment. Such impairment charges could be material to our financial statements.

16
CODELCO* business is highly dependent upon the price of copper.

CODELCOSs financial performance is significantly affected by the market prices of copper. These prices have
been historically subject to wide fluctuations and are affected by numerous factors beyond the control of CODELCO,
including international economic and political conditions, levels of supply and demand, the availability and costs of
substitutes, inventory levels maintained by producers and others and actions of participants in the commodities markets.
To a lesser extent, copper prices are also subject to the effects of inventory carrying costs and currency exchange rates.
In addition, the market prices of copper have occasionally been subject to rapid short-term changes. See “Overview of
the Copper Market.”

In 2019, copper prices averaged 272.1 cents per pound, down from 295.9 cents per pound in 2018, which
could have been attributable primarily to ongoing trade disputes between the United States and China. In the first nine
months of 2020, copper prices averaged 265.3 cents per pound compared to 274.0 cents per pound in the first nine
months of 2019, which was attributable to the impact of the COVID-19 pandemic on the Chinese and global economies
during the first nine months of 2020. China has been the main driver of copper consumption in recent years, and in
2017, 2018 and 2019, 39.6%, 49.8% and 34.5%, respectively, of CODELCO”s sales were made to China. If economic
conditions further deteriorate in China or other emerging markets, demand from customers in those markets could
decline and the market price of copper could fall. A decline in copper prices would have an adverse impact on
CODELCOS”s revenues and financial results. In 2019, each one-cent change in CODELCO””s average annual copper
price per pound sold caused a variation in operating profit of approximately U.S.$35 million. If CODELCO*s average
annual copper price per pound declines significantly for an extended period of time, CODELCO may, subject to other
factors such as operating costs, be required to recognize asset impairments similar to those recorded during 2015.

In 2015, CODELCO recognized an asset impairment charge of U.S.$2.4 billion of Anglo American Sur assets,
primarily due to the impact of a decline in, and deterioration in the outlook for, copper prices for 2015. In 2015,
CODELCO also recognized impairment charges of U.S.$311 million and U.S.$54 million in the Salvador and Ventanas
Divisions, respectively, and other non-cash charges of U.S.$277 million related to investment projects that were not
economically viable considering the copper price outlook at the time. See notes 21 and 22 of the Consolidated Financial
Statements and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for further
information about impairment charges.

In the event of a sustained decline in prices, CODELCO has in the past and could again determine to curtail
operations or suspend certain of its mining and processing operations. See “Management’s Discussion and Analysis of
Financial Condition and Results of Operations.”

CODELCO faces competition in the copper market from other copper producers.

CODELCO faces competition from other copper mining companies and producers of copper around the world.
Although CODELCO continues to focus on reducing costs, there can be no assurance that competition from lower cost
producers will not have a material adverse effect on the business, financial condition, results of operations or prospects
of CODELCO.

The mining industry has experienced significant consolidation in recent years, including consolidation among
some of CODELCO’”s main competitors, as a result of which an increased percentage of copper production is from
companies that also produce other products and are, consequently, more diversified. There can be no assurance that the
result of current or further consolidation in the industry will not have a material adverse effect on the business, financial
condition, results of operations or prospects of CODELCO.

Most of CODELCO” copper output is dependent upon production from three of its main mining complexes.

Three of CODELCO”s mining complexes produced over 65.2% of its copper output in 2019 (including
CODELCOSs share in the El Abra deposit and Anglo American Sur). The El Teniente Division, including the Caletones
smelter, produced an aggregate of 459,744 metric tons of copper in 2019. The Radomiro Tomic mine produced an
aggregate of 266,415 metric tons of copper and the Chuquicamata mine produced an aggregate of 385,309 metric tons
of copper, each during the same period. If operations in any of these three mining complexes were significantly
reduced, interrupted or curtailed, CODELCO”s financial condition and its ability to make the required payments on the

17
notes could be materially and adversely affected. CODELCO cannot assure you that production interruptions will not
occur or that any such incident would not materially adversely affect its production. See “Business and Properties—
Operations —Chuquicamata Division,” “—Radomiro Tomic Division” and “—El Teniente Division.”

The business of mining is subject to risks, some of which are not completely insurable.

The business of mining, smelting and refining copper is generally subject to a number of risks and hazards,
including industrial accidents, labor disputes, unexpected geological conditions, mine collapses, changes in the
regulatory environment, environmental hazards, weather and other natural phenomena, such as earthquakes, fires and
floods. Such occurrences could result in damage to, or destruction of, mineral properties or production facilities, human
exposure to pollution, personal injury or death, environmental and natural resource damage, delays in mining, monetary
losses and possible legal liability. CODELCO maintains insurance consistent with copper mining industry standards
and in amounts that it believes to be adequate, but which may not provide complete coverage in certain circumstances.
Insurance against certain risks (including certain liabilities for environmental pollution and other hazards as a result of
exploration and production) is not generally available to CODELCO or to other companies within the industry.

Under each of CODELCO””s copper sales agreements, CODELCO or its customer may suspend or cancel
delivery of copper during a period of force majeure. Events of force majeure under the agreements include acts of
nature, strikes, fires, floods, wars, transportation delays, governmental actions or other events that are beyond the
control of the parties. Any suspension or cancellation of deliveries under copper sales agreements that are not replaced
by delivery under new contracts or sales on the spot market could have a material adverse effect on the business,
financial condition, results of operations or prospects of CODELCO.

CODELCO*s water supply could be affected by geological changes or environmental regulations.

CODELCOS”s business is dependent on the availability of water for the production of copper and subject to
environmental regulations regarding water usage. In the past, Chile has experienced droughts severe enough to
adversely affect the energy sector of the economy in the central and southern regions of Chile. CODELCO”s access to
water may also be impacted by changes in geology or other natural factors that CODELCO cannot control. If Chile
were to experience a drought or CODELCO was otherwise unable to obtain adequate water supplies, CODELCO”s
ability to conduct its operations could be impaired.

In addition, Chile is currently drafting a new water quality standard for the Aconcagua and Cachapoal rivers
and is evaluating the adoption of a new water quality standard for the Loa river. If new water quality standards are
adopted for those water supply sources on which CODELCO depends, these new standards could result in significant
additional environmental compliance costs. Furthermore, the Government of Chile has proposed certain changes to
applicable water regulations which, if adopted, could result in increased costs and expenditures and, in extreme cases,
delays in our mining operations.

CODELCO compliance with environmental, health and safety laws may require increased costs, including capital
commitments, and non-compliance may subject it to significant penalties.

Chile has adopted environmental, health and safety regulations requiring industrial companies operating in
Chile, including CODELCO, to undertake programs to reduce, control or eliminate various types of pollutants and to
protect natural resources, including water and air, among other requirements. If the Ministerio del Medio Ambiente (the
Ministry of the Environment) declares an area to be polluted or potentially polluted, a prevention or decontamination
plan is required. Either type of plan may contain measures that may increase the costs of developing new facilities or
expanding existing ones in the designated area. Some of the areas where CODELCO operates have been declared
polluted. The measures currently included in the prevention or decontamination plans that govern these areas are
subject to change and may become more stringent if compliance with the quality standards is not achieved. CODELCO
must comply with certain air quality environmental regulations regarding particulate matter (PM¡0o) and sulfur dioxide
(SO) in the areas surrounding the Potrerillos, Caletones, Ventanas and Chuquicamata smelting plants. The Potrerillos,
Caletones and Ventanas smelting plants have decontamination plans for such pollutants. In the area surrounding the
Chuquicamata smelter, there are decontamination plans for PMio under development and under review, and a pollution
prevention plan for SO» is under development. CODELCO is currently unable to fully assess what may be required of it
or the cost of compliance with the revised PM;o pollution reduction plans, the SO, prevention plan or any future

18
changes to the other plans covering the areas where CODELCO operates. As of the date of this offering memorandum,
the impact of operating in latent and saturated zones has not been material to CODELCO; however, it could have a
material effect in the future.

An air emissions standard for smelters was enacted by the Ministry of the Environment in 2013. This standard
involves arsenic (As), SO, PMyo and mercury (Hg) emissions. Since 2013, CODELCO”s cost of complying with this
standard was U.S.$2.4 billion. As of the date of this offering memorandum, the Ventanas, El Teniente, Chuquicamata
and Salvador smelters meet the requirements of this standard. See “Regulatory Framework—Environmental
Regulations.”

Additionally, in 2015, Supreme Decree 10 declared the boroughs of Concón, Quintero and Puchuncaví, where
the Ventanas smelting plant is located, as a saturated zone with regards to PM»; and as a latent zone with regards to
PM;o, and new decontamination and prevention plans were enacted in March 2019. CODELCO estimates that the cost
of such plans will be U.S.$27 million, which will be incurred over a period of approximately four years.

Environmental, health and safety laws and regulations are complex, change frequently and have tended to
become increasingly stringent over time. For example, changes to current environmental laws and regulations, and
additional environmental laws and regulations, have recently been adopted, including mine closure legislation that
would require financial guarantees, and have recently been proposed, including green taxes, climate change,
environmental crimes and glacier protection laws that could (i) prevent expansion of our operations into certain areas,
(ii) require us to obtain additional permits and (iii) result in increased cost and potential delays. Moreover, certain
changes to environmental, health and safety laws and regulations are pending and other new laws or regulations may be
adopted in Chile in the future. In addition, community and environmental activist groups have protested the
development of certain mines of our competitors in Chile and may increase demands for socially responsible and
environmentally sustainable practices, and their efforts may lead to operational delays and the creation or revision of
government regulations and policies with respect to the mining industry in Chile, litigation and increased costs.

Finally, as a result of the Paris Agreement reached during the 21st Conference of the Parties to the United
Nations Framework Convention on Climate Change in 2015, a number of governments have pledged “Nationally
Determined Contributions” to control and reduce greenhouse gas emissions. Assuming that the Chilean economy grows
at the same rate it has grown over the previous ten years, excluding the years of the global financial crisis, and such
growth rate is sufficient, Chile has committed to reducing its CO, emissions per GDP unit by 30% below 2007 levels
by 2030 and, subject to an international monetary grant, reducing its CO, emission per GDP unit by 2030 until it
reaches a 35% to 45% reduction with respect to the 2007 levels. In addition, the Paris Agreement resulted in increased
international pressure for the establishment of a global carbon price, and on companies to adopt carbon pricing
strategies. The pricing of greenhouse gas emissions may impact our operational costs, mainly through higher price for
electricity and fossil fuels as mining is an energy intensive industry. Recently, during the 25th Conference of the Parties
to the United Nations Framework Convention on Climate Change in Madrid, the Chilean government announced an
update to its Nationally Determined Contribution, which includes the reduction of its CO2 emissions per GDP unit by
45% below 2016 levels by 2030.

Any of these new laws or regulations could result in significant additional environmental compliance costs or
delays in expansion projects. As of September 30, 2020, CODELCO had total provisions of U.S.$2.0 billion for future
decommissioning and site restoration costs, primarily related to tailing dams, closures of mine operations and other
mining assets. CODELCO”s operations outside Chile are also subject to extensive international, national and local
environmental, health and safety laws and regulations.

CODELCO is developing and implementing environmental management systems at each of its divisions to
monitor and achieve compliance with applicable environmental laws and regulations. While CODELCO has budgeted
for future capital and operating expenditures to maintain compliance with these laws and regulations, there is no
guarantee that current levels of expenditures and capital commitments will be sufficient to achieve future compliance.
There also can be no assurance that CODELCO has been or will be at all times in complete compliance with
environmental laws and regulations, or that proceedings or civil actions will not be brought, or that fines and other
sanctions will not be imposed for such non-compliance in the future. In addition, there can be no assurance that more
stringent enforcement of, or changes in, existing laws and regulations, the adoption of additional laws and regulations

19
or the discovery of new facts resulting in increased liabilities would not have a material adverse effect on CODELCO”s
business, financial condition, results of operations or prospects.

For further information on environmental matters, and current and proposed environmental laws and
regulations, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity
and Capital Resources —Environmental” and “Regulatory Framework—Environmental Regulations.”

CODELCO is subject to legal proceedings and legal compliance risks that may adversely impact its financial
condition, results of operations and liquidity.

CODELCO spends substantial resources ensuring that it complies with local regulations, contractual
obligations and other legal standards. Notwithstanding this, CODELCO is subject to a variety of legal proceedings and
compliance risks in respect of various matters, including tax- and labor-related matters that arise in the course of its
business and in its industry as well as disputes with governmental agencies. For example, CODELCO is subject to
various labor proceedings in which workers and families of deceased workers allege that working conditions caused the
workers to contract silicosis. Although CODELCO has undertaken precautionary measures, there have been fatalities
involving CODELCO personnel in the past and there may be additional fatalities in the future. Serious accidents,
including fatalities, may subject CODELCO to substantial penalties, civil litigation or criminal prosecution. Claims for
damages to persons, including claims for bodily injury or loss of life, could result in substantial costs and liabilities,
which could materially and adversely affect CODELCO”s financial condition, results of operations or cash flows. If
CODELCO”s safety record were to substantially deteriorate over time or CODELCO were to suffer substantial
penalties or criminal prosecution for violation of health and safety regulations, CODELCO”s contracts may be
cancelled or it may not be awarded future business. In addition, CODELCO has filed administrative appeals against
three statements on the Company issued by the Comptroller General of the Republic of Chile (the “Comptroller”) in
2017. The Company estimates that these statements have had, as of the date of this offering memorandum, a negative
effect of approximately U.S.$100 million due to a reduction in production related to the delay in awarding specific
contracts and the delay of investments. A final decision regarding this matter is pending. A negative outcome in an
unusual or significant legal proceeding or compliance investigation could also adversely affect our financial condition
and results of operations. For information regarding CODELCO”s current significant legal proceedings, see “Business
and Properties—Comptroller General of the Republic” and “Business and Properties—Legal Proceedings.”

Earthquake damage to CODELCO*s properties and operations could negatively affect CODELCOS*s results.

Chile is located in a seismic area that exposes CODELCO”s operations to the risk of earthquakes. Chile has
been adversely affected by powerful earthquakes in the past, including, most recently, (1) in 2015 when an earthquake
struck the coast of Chile, (ii) in 2014 when an earthquake struck the north of Chile and (iii) in 2010 when a severe
earthquake struck the southern central region of Chile. The 2015 earthquake measured 8.3 on the Richter scale and
affected the coast of Chile just north of Santiago, with no significant consequences for the rest of the country. The 2014
earthquake measured 8.2 on the Richter scale and affected mainly the Arica and Tarapacá Regions, with no significant
consequences for the rest of the country. The 2010 earthquake and its aftershocks, as well as tsunamis from adjacent
coastal waters, caused severe damage to Chiles infrastructure, including roads, bridges, ports and Santiago”s
international airport, affecting areas across the country.

Although the 2015, 2014 and 2010 earthquakes did not have any substantial effect on CODELCO or its results
of operations, and although CODELCO”s mining operations are subject to, and designed to withstand, damage from
significant seismic events, an earthquake occurring closer to CODELCO”s operations in northern Chile could cause
damage to its mining operations that would not be covered by insurance, except to the extent that its production ceased
for more than 30 days. Any such damages caused by an earthquake that were not covered by insurance could have an
adverse effect on CODELCOSs results of financial condition, results of operations or cash flow.

Future compliance with a changing and complex regulation scheme may require changes in CODELCO business.

CODELCO'”s exploration, mining, milling, smelting and refining activities are also subject to
non-environmental Chilean laws and regulations (including certain industry technical standards), which change from
time to time. Matters subject to regulation include, but are not limited to, concession fees, transportation, production,
reclamation, export, taxation and labor standards.

20
While CODELCO does not believe that compliance with such laws and regulations will have a material
adverse effect on its business, financial condition, results of operations or prospects, there can be no assurance that
more stringent enforcement of, or change in, existing laws and regulations, the adoption of additional laws and
regulations, including increased government supervision and control over the management of CODELCO”s business
and its awarding of contracts, or the discovery of new facts resulting in increased liabilities or costs would not have a
material adverse effect on CODELCO”s business, financial condition, results of operations or prospects.

CODELCO*s business plans are based on estimates of the volume and grade of CODELCO*s ore deposits, which
could be incorrect.

CODELCO”s ore deposits (its resources and reserves) described in this offering memorandum constitute
estimates based on standard evaluation methods generally used in the international mining industry and on assumptions
as to production costs and market prices. The actual ore deposits may not conform to geological, metallurgical or other
expectations, and the volume and grade of ore recovered may be below the estimated levels. Lower market prices, as
well as increased production costs, reduced recovery rates and other factors, may render CODELCO”s ore deposits
uneconomic to exploit and may result in revision of its reserve and resource estimates from time to time. Reserve and
resource data are not indicative of future results of operations. See “Business and Properties—Ore Reserves.”

CODELCO business requires substantial capital expenditures.

CODELCOS”s business is capital-intensive. Specifically, the exploration and exploitation of copper reserves,
mining, smelting and refining costs, the maintenance of machinery and equipment and compliance with applicable laws
and regulations require substantial capital expenditures. CODELCO must continue to invest capital to maintain or to
increase the amount of copper reserves that it exploits and the amount of copper that it produces. CODELCO expects to
make capital expenditures of approximately U.S.$12.5 billion between 2020 and 2022 on major projects, which it
intends to finance through operations, including capitalization and retention of profit, in addition to new borrowings
from banks and capital markets. See “Management’s Discussion and Analysis of Financial Condition and Results of
Operations—Liquidity and Capital Resources—Capital Expenditure Program.” There can be no assurance that
CODELCO will be able to maintain its production levels or generate sufficient cash flow, capitalize a sufficient amount
of its profit or have access to sufficient investments, loans or other financing alternatives to finance its capital
expenditure program at a level necessary to continue its exploration, exploitation and refining activities at or above its
present levels.

CODELCO*s future performance depends on the results of current and future innovation and exploration.

CODELCO has a two-pronged exploration program that is focused on increasing reserves of its existing
divisions and exploring for new deposits outside of its current operations. As the ore quality of CODELCO*s reserves
continues to decline over time, innovation and exploration are increasingly important to CODELCO’”s success.
CODELCO expects to maintain its production levels through its expansion and development projects for the next three
years. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and
Capital Resources—Capital Expenditure Program” for more detail. While initial results have been favorable, there can
be no guarantee that CODELCO”s exploration program will continue to be successful. In addition, there may be some
degree of execution risk associated with the expansion of operations into deeper mines or mines at higher altitudes.
CODELCO”s expansion program could also experience delays or be negatively impacted by higher costs. If
CODELCO”s expansion program is not successful, it would materially and adversely affect its copper production
levels. For a description of CODELCO””s current development programs, see “Business and Properties—Resource
Development.”

CODELCO has experienced high energy costs and may experience higher energy costs in the future.

Energy represents a material portion of the production costs for CODELCO. The main energy sources for
CODELCOSs operations are electricity, liquid fuels (such as diesel, fuel oil and gasoline) and natural gas. Since 2004,
there has been a restricted supply of natural gas from Argentina. CODELCO”s production costs have increased due to
these shortages as it must rely on electricity generated from more expensive sources, such as diesel, oil or coal, and
these increased costs have adversely affected CODELCO”s results. CODELCO has taken certain actions to secure the
sources from which it can procure energy, including entering into long-term electrical contracts at competitive prices,

21
participating in the construction of liquefied natural gas (“LNG”) re-gasification terminals and entering into a five-year
supply contract for liquid fuels which are expected to meet its energy requirements. See “Business and Properties—
Production Costs of Copper.” In 2014, Chile passed a carbon tax targeting the power sector, which became effective in
2017. CODELCO began paying the taxes due under this law in 2018. If CODELCO'”s energy suppliers do not perform
as expected or if there is an increase in energy costs in the future, CODELCO””s profits and cash flow could be
adversely affected.

Any interruption or destruction or loss of data in CODELCO*s information technology systems due to technical or
operational malfunctions or cyber-attacks could have a material adverse effect on its reputation, business, financial
condition and results of operations.

CODELCO is subject to a variety of information technology and system risks as a part of its normal course of
operations, including potential breakdown, invasion, virus, cyber-attack, cyber-fraud, security breach, and destruction
or interruption of CODELCO”s information technology systems by third parties or CODELCO””s own personnel.
Although CODELCO has security measures and controls in place that are designed to mitigate these risks, a breach of
its security measures or a loss of information could occur and result in a loss of material and confidential information,
breach of privacy laws and a disruption to its business activities. In addition, information systems could be damaged or
interrupted by natural disasters, force majeure events, telecommunications failures, power loss, acts of war or terrorism,
computer viruses, malicious code, physical or electronic security breaches, intentional or inadvertent user misuse or
error, or similar events or disruptions. Any of these or other events could cause interruptions, delays, loss of critical or
sensitive data or similar effects, which could have a material adverse impact on the protection of intellectual property,
confidential and proprietary information, and on CODELCO*s business, financial condition and results of operations.

Labor disruptions involving CODELCO”s employees or the employees of its independent contractors could affect
CODELCO*s production levels and costs.

As of December 31, 2019, CODELCO employed 16,731 employees, approximately 90% of whom were
covered by collective bargaining agreements with labor unions. Most of these collective bargaining agreements have
terms of two to three years. CODELCO has experienced material work slowdowns, work stoppages and strikes in the
past. Most recently, CODELCO experienced a 39-day strike involving 83 union workers from the Andina Division, a
one-day strike that blocked access to the Chuquicamata mine to four of the six labor unions and a 14-day strike
involving 3,200 union workers in the Chuquicamata Division (or approximately 67% of the total work force). The 14-
day strike diminished production by approximately 17,600 metric tons.

CODELCO negotiated two collective bargaining agreements in the nine-month period ended September 30,
2020. CODELCO negotiated eight collective bargaining agreements in 2019. In 2018, CODELCO negotiated 18
collective bargaining agreements. Twelve collective bargaining agreements, covering a total of 7,081 employees at the
Andina Division, Salvador Division, Mina Ministro Hales Division, El Teniente Division and Gabriela Mistral
Division, were negotiated ahead of schedule without any conflicts or work stoppages. Five collective bargaining
agreements, covering a total of 2,601 employees at the Radomiro Tomic Division, Mina Ministro Hales Division,
Chuquicamata Division and our headquarters, were negotiated on schedule without any conflicts or work stoppages.
The remaining collective bargaining agreement was reached at the conclusion of the 39-day strike with the workers
from the Andina Division.

CODELCO has experienced work disruptions in the past, and there can be no assurance that a work slowdown
or work stoppage will not occur prior to or upon the expiration of the current collective bargaining agreements.
Management is unable to estimate the effect of any such work slowdown, stoppage or strike on CODELCO”s
production levels. Work slowdowns, stoppages or other labor-related developments affecting CODELCO could have a
material adverse effect on the business, financial condition, results of operations or prospects of CODELCO. In
particular, work slowdowns, stoppages and other labor-related events could increase CODELCO”s independent
contracting costs. In addition, pursuant to the Código del Trabajo (the “Labor Code of Chile”), CODELCO could be
held liable for the payment of labor and social security obligations owed to the employees of independent contractors
(or their subcontractors) if the independent contractors (or their subcontractors) do not fulfill those payment obligations.
For further information on employee and independent contractor matters, including recent work disruptions, see
“Business and Properties—Employees.”

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CODELCO is subject to an extensive labor reform law promulgated by the Government of Chile that could affect its
business and operating results in the future.

In 2016, the Government of Chile promulgated an extensive labor reform law (the “Labor Reform Law”),
which became effective in 2017. The Labor Reform Law prevents Chilean companies from hiring temporary
replacements for striking employees and also prevents the replacement of striking employees with other existing
employees of the company. This may have an adverse effect on our overall employment and operating costs, and may
increase the likelihood of business disruptions in Chile. However, it has not been a practice of CODELCO to replace
employees on strike, and there has not been an increase in labor disruptions in Chile since the law became effective.

In addition, under the Labor Reform Law, CODELCO and its labor unions negotiate from time to time the
minimum services and emergency equipment that the labor unions must provide in case of a strike during a collective
bargaining process. Currently, the following minimum services must be strictly enforced: (i) services that are strictly
necessary to protect the physical assets and premises of the Company and to prevent accidents; (1i) services strictly
necessary to guarantee the rendering of all services of public utility, and the attention of the population and basic needs,
including those related to life, safety and health; and (iti) services strictly necessary to guarantee the prevention of
sanitary or environmental damage. If there is any disagreement between CODELCO and its labor unions regarding such
minimum services and emergency equipment, the parties may resolve such disagreement through administrative
proceedings before the Dirección Regional del Trabajo (Regional Labor Board), which are subject to challenge by the
parties before the Director Nacional del Trabajo (National Labor Board).

As of December 31, 2019, CODELCO employed 16,731 employees, approximately 90% of whom were
covered by collective bargaining agreements with labor unions. CODELCO currently has positive labor relations with
these unions. CODELCO is currently unable to estimate the impact that the Labor Reform Law or similar reforms will
have on its labor relations with respect to labor unions, or on its business, financial condition, operating results and
prospects.

CODELCO engages in hedging activity from time to time, particularly with respect to its copper production, which
may not be successful and may result in losses to CODELCO.

CODELCO from time to time hedges certain future copper delivery commitments and production in order to
manage the risks associated with copper price volatility. CODELCO currently does not have any production hedging
commitments. See notes 27 and 28 to the Consolidated Financial Statements.

CODELCOSs production hedging activities could cause it to lose the benefit of an increase in copper prices if
copper prices increase over the level of CODELCO”s hedge position, as occurred in 2012. The cash flows from and the
mark-to-market values of CODELCO”s production hedges can be affected by factors such as the market price of
copper, copper price volatility and interest rates, which are not under CODELCO*s control.

CODELCOSs production hedging agreements contain events of default and termination events that could lead
to early close-outs of CODELCO”s hedges. These include failure to pay, breach of the agreement, misrepresentation,
default under CODELCO”s loans or other hedging agreements and bankruptcy. In the event of an early termination of
CODELCO”s hedging agreements, the cash flows from the affected hedge instruments would cease and CODELCO
and the relevant hedge counterparty would settle all of CODELCO*s obligations at that time. In that event, there could
be a lump sum payment to be made either to or by CODELCO. The magnitude and direction of such a payment would
depend upon, among other things, the characteristics of the particular hedge instruments that were terminated and the
market price of copper and copper price volatility and interest rates at the time of termination.

In addition to its production hedging activities, CODELCO has hedged a portion of its exchange rate and
interest rate exposure by entering into forward exchange contracts to hedge against fluctuations in the UF to U.S. dollar
exchange rate for its outstanding UF-denominated bonds. CODELCO also periodically enters into futures contracts
with respect to certain sales of its own copper. No assurance can be given that CODELCO will be adequately protected
by its hedging activities.

See “Business and Properties—Marketing—Pricing and Hedging,” notes 27 and 28 to the Consolidated
Financial Statements for further information on CODELCO*s hedging activity.

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Global economic, political and regulatory developments may adversely affect CODELCO.

Revenue from international sales constitutes a material portion of our total revenue, and we anticipate it will
continue to for the foreseeable future. The current U.S. administration has called for substantial changes to United
States foreign trade policy, including the possibility of imposing greater restrictions on international trade and
significant increases in tariffs on goods imported into the United States. For example, the United States has recently
enacted a series of tariffs on the import of Chinese products. The continued threats of tariffs, trade restrictions and trade
barriers could have a generally disruptive impact on the global economy and, therefore, negatively impact our revenues.
Given the relatively fluid regulatory environment in China and the United States and uncertainty on how the United
States or foreign governments will act with respect to tariffs, international trade agreements and policies, there could be
additional tax or other regulatory changes in the future. Any such changes could adversely impact CODELCO”s
business, financial condition and results of operations. If our revenues generated from international sales decline
significantly as a result, it could have a material adverse effect on CODELCO”s business and results of operations.

The departure of the UK from the European Union could have an adverse effect on CODELCOS*s business, financial
condition and potential growth in Europe.

The UK withdrew from the European Union (“EU”) on January 31, 2020, subject to a transition period that is
set to end on December 31, 2020. The potential impact of this withdrawal, commonly referred to as “Brexit,” is
uncertain while the British government continues to negotiate the terms of the UK”s future relationship with the EU
during the transition period. Brexit has also given rise to calls for the governments of other EU member states to
consider withdrawal from the EU. These developments, or the perception that they could occur, have had and may
continue to have a material adverse effect on global economic conditions and the stability of global financial markets,
including by significantly reducing global market liquidity or restricting the ability of key market participants to operate
in certain financial markets. Brexit is likely to continue to adversely affect European and worldwide economic
conditions and could contribute to greater instability in the global financial markets before and after the terms of the
UK’s future relationship with the EU are settled.

These effects could have an adverse effect on our business, financial condition and potential growth into
Europe. However, the eventual effects of the UK”s departure from the EU on CODELCO”s business and financial
condition are uncertain at this time.

Risks Relating to CODELCO”s Relationship with the Government of Chile

Important corporate governance matters, the annual budget and financing programs are determined by or subject to
the approval of the President of Chile and the Ministries of Finance and Mining.

CODELCO is a mining, industrial and commercial state-owned enterprise of indefinite duration with its own
legal personality and capital. CODELCO”s relationship with the Government of Chile is through the Ministry of
Mining, and is governed by Decree Law 1,350, as amended by Law 20,392, its bylaws and other applicable legislation.
The President of Chile is vested with the authority analogous to that of the shareholders of a corporation (sociedad
anónima) under Chilean law, which may be delegated in whole or in part to the Ministers of Finance and Mining,
jointly. Pursuant to such authority, the President of Chile (1) participates in the designation of the Board of Directors by
designating three directors without external input and by electing six directors on the basis of third-party short lists; (11)
appoints the Chairman of the Board of Directors; and (iii) may approve and amend the bylaws of the Company, by
means of an executive decree issued jointly by the Ministries of Finance and Mining. In 2017, Miguel Juan Sebastián
Piñera Echenique was re-elected as President of Chile, after having previously served as President from 2010-2014. Mr.
Piñera”s administration began on March 11, 2018. Senior management and administration of the Company are vested in
its Board of Directors and further delegated to its Chief Executive Officer. Pursuant to Decree Law 1,350,
CODELCO”s Board of Directors must submit its proposed annual budget to the Ministries of Finance and Mining for
approval and possible revision. In addition, Decree Law 1,350 requires CODELCO to include as part of its proposed
annual budget a debt amortization budget that includes interest and principal payments on CODELCO”s debts,
including the notes. CODELCO must also submit a three-year Plan de Negocios y Desarrollo (a Business Development
Plan, or “BDP”) report, approved by the Company”s Board of Directors, to the Ministries of Finance and Mining by
March of each year. There is no guarantee that actions taken with respect to the appointment of CODELCOS”s directors,
amendments to its bylaws, and revision and approval of its budget, including CODELCO”s capitalization of profit, will

24
be adopted by the administration of the new President and/or will be the same as they would be in a privately owned
company. See “Management” and “Regulatory Framework.”

CODELCO funding through retention of profits is restricted and is subject to the approval of the Ministries of
Finance and Mining.

As a state-owned enterprise and according to its governing law, CODELCO'”s profit is required to be
transferred to the Chilean Treasury. Before June 30 of each year, the Ministries of Finance and Mining are required to
determine, by means of a joint decree, the amount, if any, that the Company shall allocate to the creation of
capitalization and reserve funds as retention of profits. Between 2014 and 2019, the Government of Chile authorized
the capitalization by capital injection and retention of profit within CODELCO in an aggregate amount of U.S.$3.3
billion. Although CODELCO currently expects the Ministries of Finance and Mining to make available a substantial
amount of its pre-tax profit over the next three years, a joint decree of the Ministries of Finance and Mining is required
each year and the amounts approved in any given year, if any, could vary significantly.

IfCODELCO”s funding through capitalization and retention of profits, depreciation, amortization and deferred
taxes are insufficient to fund capital expenditures and if it is unable to otherwise finance planned expenditures,
CODELCO’s business would be adversely affected. See “Management’s Discussion and Analysis of Financial
Condition and Results of Operations—Liquidity and Capital Resources.” In addition, if the Government of Chile does
not authorize additional capitalization or the retention of profits, our credit rating may be adversely affected, which
could have a material adverse effect on our business and financial condition.

CODELCO is subject to special taxes.

The Copper Reserve Law currently requires the payment of a 10% special export tax on receivables of the
sales proceeds that CODELCO receives and transfers to Chile from the export of copper and related by-products
produced by CODELCO. As a result, the Banco Central de Chile (the “Central Bank of Chile”) retains 10% of the
amounts from such sales that CODELCO transfers to its Chilean account. All such amounts are then transferred via the
Central Bank of Chile. The Copper Reserve Law has an adverse effect on our ability to retain earnings for purposes of
capital expenditures. In July 2019, the Congress of Chile issued a new resolution to repeal the Copper Reserve Law.
Under this resolution, CODELCO will remain subject to the 10% special export tax until 2028. Beginning in 2029, the
tax will be reduced annually by 25% until 2032 when CODELCO will no longer be subject to such tax. As of April 1,
2020, CODELCO is paying the taxes owed pursuant to the Copper Reserve Law on a monthly basis, following a
response measure from the Government of Chile to the economic effects of the COVID-19 pandemic. As of the date of
this offering memorandum, CODELCO has paid the taxes due for 2019, together with the taxes due for January and
February 2020 and, as of April 1, 2020, has begun paying the 10% special export tax on a monthly basis, beginning
with the taxes due for March 2020.

Pursuant to the terms of Chile”s income tax law (the “Income Tax Law”), interest, premiums, remuneration for
services, financial expenses and any other contractual surcharges under credit facilities entered into or disbursed on or
after January 1, 2015, and which are paid or credited to an account or made available to “related entities” of
CODELCO in respect of loans or liabilities existing during the year in which the indebtedness is considered to be
excessive, are subject to a 35% penalty tax that CODELCO is required to pay. The withholding tax applicable to the
interest payments made by CODELCO can be used as a credit against such 35% penalty tax. Indebtedness will be
considered to be excessive when at the end of the corresponding fiscal year a “total annual indebtedness” to entities
incorporated, domiciled or established in a foreign country or in Chile, either related or not, exceeds three times the
equity of CODELCO, calculated pursuant to the provisions of article 41 F of the Income Tax Law. Under the
“Excessive Indebtedness” rules, a lender or creditor will be deemed to be related to CODELCO if: (i) the beneficiary
(.e., lender or creditor) is incorporated, domiciled, resident or established in one of the territories or jurisdictions listed
in section 41 H of the Income Tax Law; (ii) each of the beneficiary (i.e., lender or creditor) and CODELCO belong to
the same corporate group or, directly or indirectly, owns or participates in 10% or more of the capital or the profits of
the other, or if the beneficiary and CODELCO have a common partner or shareholder which, directly or indirectly,
owns or participates in 10% or more of the capital or the profits of one or the other, and such beneficiary is
incorporated, domiciled, resident or established outside Chile; (111) the indebtedness is guaranteed directly or indirectly
by a third-party related to CODELCO, in the terms of clauses (1) or (1i) above, or (iv) hereafter, provided that such
third-party is domiciled or resident abroad and is a final beneficiary (beneficiario final) of the financing; (iv) the

25
relevant financial instruments documenting such indebtedness are placed and acquired by independent entities and such
indebtedness is subsequently acquired or transferred to a related entity according to subsections (1) to (111) above; or (v)
one party (i.e., beneficiary or CODELCO) conducts one or more operations with a third-party who, in turn, directly or
indirectly conducts one or more similar or identical operations with a related party of such party.

Since the 2012 fiscal year, CODELCO has been subject to a mining tax on operating income generated during
the operating year at progressive rates between 5% and 14%. During 2019, CODELCO distributed a total of U.S.$1.0
billion (including income tax, and export tax payments and distributions) to the Chilean Treasury. See “Management’s
Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—
Distributions to the Chilean Treasury” and “Regulatory Framework.” The statutory rate of the mining tax was 5% for
each of 2017, 2018 and 2019.

In 2014 and 2020, extensive tax reforms were enacted in Chile. However, CODELCO, as a 100% state-owned
corporation, is not subject to either of the reforms. Instead CODELCO is subject to a corporate tax rate on its net
taxable income determined under full accounting records. Its corporate tax rate has gradually increased from 21% in
2014 to up to 25% since 2017. In addition, CODELCO is subject to a 40% tax on net earnings applicable to
state-owned enterprises as specified by Decree Law 2,398, Art. 2.

Constitutional amendments could be proposed that would allow private ownership of CODELCO.

CODELCO is 100% owned by the Government of Chile and a constitutional amendment approved by the
Chilean Congress would be required to allow private participation in CODELCO”s ownership. Although there has been
no formal governmental action to permit private investment in CODELCO, no assurance can be given that such a
constitutional amendment will not be proposed to the Chilean Congress in the future. See “Regulatory Framework—
Overview of the Regulatory Regime.”

Risks Relating to Chile

CODELCO’s growth and profitability depend on political stability and economic activity in Chile and other
emerging markets.

Almost all of CODELCO’s revenues are derived from its operations in Chile. Accordingly, CODELCO”s
results of operations and general financial condition depend in part on Chilean markets for labor and certain materials
and equipment, and on factors relating to Chilean political stability generally.

Chile recently experienced political unrest and social strife, including a wave of protests and riots, beginning
on October 18, 2019, sparked by an increase in the subway fare of the Santiago Metro and widened to reflect anger over
living costs and inequality. The continuing unrest in Chile and associated civil protests caused temporary disruptions in
port operations and as a result temporary delays of shipments from CODELCO to its customers. In addition, indicators
of economic activity in Chile were adversely affected in the fourth quarter of 2019. Additionally, on October 25, 2020,
Chile held a nationwide plebiscite which resulted in the approval of a plan to call a Constitutional Convention, to be
composed of elected members, in which a new constitution will be drafted. In June 2022, a second nationwide
plebiscite will take place, in which the new constitution will be submitted for approval of voters. There can be no
assurance that future developments in or affecting the Chilean political situation, including economic or political
instability in other emerging markets, will not result in material and adverse effects on CODELCO”s business, financial
condition or results of operations. CODELCO also could be adversely affected by legal or regulatory changes over
which it has no control.

26
CODELCO* business performance is subject to the effects of inflation and changes in the value of the peso.

Although Chilean inflation has remained low in recent years, Chile has experienced high levels of inflation in
the past. High levels of inflation in Chile could adversely affect the Chilean economy and have an adverse effect on
CODELCOSs results of operations if the high inflation is not accompanied by a matching devaluation of the local
currency. There can be no assurance that Chilean inflation will not revert to prior levels in the future. In addition, the
measures taken by the Central Bank of Chile to control inflation have often included maintaining a tight monetary
policy with high interest rates, thereby restricting the availability of credit and economic growth.

The following table shows the annual rate of inflation (as measured by changes in the Chilean consumer price
index and as reported by the Instituto Nacional de Estadísticas, or the “Chilean National Institute of Statistics”):

Year Inflation (CPI)
(in percentages)

2017. 2.3

2018. 2.6

2019. 3.0

2020 (through September 30,2020) 2.1

Source: Chilean National Institute of Statistics

A significant portion of CODELCO”s operating costs are denominated in pesos and could therefore be
significantly affected by the rate of inflation in Chile. If inflation in Chile were to increase without a corresponding
depreciation of the peso, or if the value of the peso were to appreciate relative to the U.S. dollar without the peso
experiencing corresponding deflation in Chile, the financial position and results of operations of CODELCO as well as
the value of the notes could be materially and adversely affected. See “Management’s Discussion and Analysis of
Financial Condition and Results of Operations —Liquidity and Capital Resources.”

The variation of the U.S. dollar against the peso constitutes CODELCO”s main foreign exchange rate
exposure. The mismatch between assets and liabilities denominated in pesos amounts to a net liability for the Company
of U.S.$1.9 billion (6.5% of the total amount of liabilities on a consolidated basis) as of December 31, 2019 and
U.S.$1.3 billion (4.3% of the total amount of liabilities on a consolidated basis) as of September 30, 2020. In order to
cover this risk, CODELCO has, and currently is, engaged in hedging transactions to partially mitigate the effects of the
volatility of foreign exchange rates. See “Risk Factors—Risks Relating to CODELCO”s Operations —CODELCO
engages in hedging activity from time to time, particularly with respect to its copper production, which may not be
successful and may result in losses to CODELCO.”

Risks Relating to the Offering

In case of a default under the notes, the ability of holders to attach property of CODELCO may be limited by
Chilean law.

CODELCOSs activities in Chile are dependent on concessions granted by the Chilean Ordinary Courts with
respect to CODELCO”s mining rights. These concessions are granted for indefinite terms in the case of exploitation
concessions and for two-year periods in the case of exploration concessions (renewable with certain limitations). As a
general matter, the Ordinary Courts, through legal proceedings brought by third parties (or by the Chilean Treasury in
case of noncompliance with the obligation to pay annual fees), have the legal right to terminate or annul the
concessions. Pursuant to the Chilean Mining Code, all mining concessions, as well as certain raw materials and other
property or assets permanently dedicated to the exploration or extraction of minerals, cannot be subject to an order of
attachment, except with respect to mortgages, where the debtor consents to the attachment in the relevant legal
proceeding or when the debtor is a stock corporation. In addition, pursuant to the Constitution, mining concessions
corresponding to mining deposits exploited by CODELCO upon its creation in 1976 can be subject neither to
attachment nor to any act of disposition by CODELCO. As a result, the rights of holders to attach property of
CODELCO in the event of a default under the notes would be limited by such provisions. See “Regulatory
Framework—Mining Regulations.”

27
CODELCO is permitted to incur additional indebtedness ranking equally to the notes or certain secured
indebtedness.

The indenture governing the notes will not contain any restrictions on the amount of additional indebtedness
which may be incurred by CODELCO or its subsidiaries; however, the notes contain restrictions on the ability of
CODELCO and its subsidiaries to incur certain secured indebtedness as set forth in “Description of Notes—Limitations
on Liens” below. As a result, CODELCO is permitted to issue additional unsecured debt that ranks on an equal basis
with the notes. If CODELCO incurs any additional unsecured debt that ranks on an equal basis with the notes, the
holders of that debt will be entitled to share with the holders of the notes in any proceeds distributed in connection with
an insolvency, liquidation, reorganization, dissolution or other winding-up of CODELCO subject to satisfaction of
certain debt limitations. This may have the effect of reducing the amount of proceeds paid to the holder of the notes
under such an event. The indenture does not require CODELCO to make payments under the notes ratably with
payments being made under any other obligations.

If certain changes to tax law were to occur, CODELCO would have the option to redeem the notes.

Under current Chilean law and regulations, payments of interest to holders of the notes that are not residents of
Chile for purposes of Chilean taxation generally will be subject to Chilean withholding tax at a rate of 4%. Subject to
certain exceptions, CODELCO will pay Additional Amounts (as defined in “Description of Notes—Payments of
Additional Amounts”) so that the amount received by the holder after Chilean withholding tax will equal the amount
that would have been received if no such taxes had been applicable. The notes are redeemable at the option of
CODELCO in whole, but not in part, at any time, at the principal amount thereof plus accrued and unpaid interest and
any Additional Amounts due thereon if, as a result of changes in the laws or regulations after the date of this offering
memorandum affecting Chilean taxation, CODELCO becomes obligated to pay Additional Amounts with respect to
interest on such notes in respect of withholding or deduction of Chilean tax at a rate in excess of 4%. CODELCO is
unable to determine whether such an increase in the withholding tax rate will ultimately be presented to or enacted by
the Chilean Congress; however, if such an increase were enacted, the notes would be redeemable at the option of
CODELCO. See “Description of Notes— Redemption—Tax Redemption” and “Taxation—Chilean Taxation.”

Our obligations under the notes will be subordinated to certain statutory liabilities.

Under Chilean bankruptcy law, the obligations under the notes are subordinated to certain statutory
preferences. In the event of a liquidation, such statutory preferences, including claims for salaries, wages, secured
obligations, social security, taxes and court fees and expenses, will have preference over any other claims, including
claims by any investor in respect of the notes.

The market value of the notes may depend on economic conditions in other countries over which CODELCO has no
control.

The market value of securities of Chilean companies, including CODELCO, is affected to varying degrees by
economic and market conditions in other emerging market countries. Although economic conditions in such countries
may differ significantly from economic conditions in Chile, investors” reactions to developments in any of these other
countries may have an adverse effect on the market value of securities of Chilean issuers. International financial
markets have in recent years experienced volatility due to a combination of international political and economic events.
There can be no assurance that the deterioration of emerging market economies or other events in or outside of the
region will not adversely affect the market value of the notes.

The transferability of the notes may be limited by the absence of an active trading market and restrictions on
transfer under applicable securities law.

The notes have not been registered under the Securities Act or any state securities laws. CODELCO does not intend to
list the notes on any national securities exchange or to seek admission of the notes for trading on any securities
exchange in the United States; however, we intend to apply to list the notes on the Luxembourg Stock Exchange.
Furthermore, CODELCO does not intend to exchange the notes for notes that are registered under the Securities Act.
The initial purchasers are not obligated to make a market in the notes. No assurance can be given about the liquidity of
any markets that may develop for the notes, the ability of holders to sell the notes or the prices at which the notes could

28
be sold. Future trading prices of the notes will depend on many factors, including prevailing interest rates,
CODELCOSs operating results and the market for similar securities. There can be no assurance that any active trading
market will develop for the notes or that holders of the notes will be able to transfer or resell the notes without
registration under applicable securities laws.

We cannot assure you that our credit rating, or the credit ratings for the notes, will not be lowered, suspended or
withdrawn by the rating agencies.

Our credit rating is subject to change in the future, and the credit ratings of the notes may change after
issuance. Such ratings do not address all material risks relating to an investment in CODELCO, or its notes, but rather
reflect only the views of the rating agencies at the time the ratings are issued. An explanation of the significance of such
ratings may be obtained from the rating agencies. CODELCO cannot assure you that such credit rating will remain in
effect for any given period of time or that such ratings will not be lowered, suspended or withdrawn entirely by the
rating agencies, if, in the judgment of such rating agencies, circumstances so warrant. Our credit rating is an important
part of maintaining our liquidity. Any lowering, suspension or withdrawal of such ratings may potentially increase our
borrowing costs, and may have an adverse effect on our financial results and business operations and the market price
and marketability of the notes.

Payments claimed in Chile on the notes, pursuant to a judgment or otherwise, may be in pesos.

In the event that proceedings are brought against CODELCO in Chile, either to enforce a judgment or as a
result of an original action brought in Chile, CODELCO would not be required to discharge those obligations in a
currency other than Chilean currency. Such obligation may be satisfied in Chilean currency at the exchange rate in
effect on the date on which payments are made. As a result, holders of the notes may suffer a U.S. dollar shortfall if
judgment in Chile is obtained.

29
USE OF PROCEEDS

The estimated total net proceeds from the offering of the notes are U.S.$492,036,737, after deducting commissions to
the initial purchasers, payment of the Chilean stamp tax of U.S.$4,000,000 and payment of legal fees and all other
expenses related to the offering. CODELCO intends to use the net proceeds from the sale of the notes (i) to pay the
consideration for the Tender Offers and accrued and unpaid interest on the Tender Notes, (ii) to pay fees and expenses
incurred in connection with the Tender Offers and (iii) the remainder, if any, for general corporate purposes. The
Tender Offers are not being made pursuant to this offering memorandum. The closing of the Tender Offers is
contingent upon the closing of this offering. See “Management’s Discussion and Analysis of Financial Condition and
Results of Operations—Liquidity and Capital Resources” and “Capitalization.”

30
CAPITALIZATION

The following table sets forth the capitalization of CODELCO as of September 30, 2020 (i) on an actual historical
basis, (ii) as adjusted to give effect to (a) the Prepayments and (b) the offering of the notes and application of the
estimated net proceeds from the offering of the notes as described under “Use of Proceeds.” This table is qualified in its
entirety by reference to, and should be read together with, CODELCO”s Unaudited Interim Consolidated Financial
Statements, including the notes thereto, included elsewhere in this offering memorandum.

As of September 30, 2020
Actual As Adjusted
(in thousands of U.S.S)
Current financial liabilities
Current portion of loans from financial institutions……. s 390,953 $ 390,953
Current portion of bonds issued……… 550,405 550,405
Total current financial liabilities ….. s 941,358 $ 941,358
Non-current financial liabilities
Bank debt ……. Ss 2,124,583 $ 1,524,583
3.875% Notes due 2021 226,641 226,641
3.000% Notes due 2022 411,352 411,352
4.500% Notes due 2023 467,748 467,748
2.250% Euro Notes due 2024 697,098 697,098
4.000% UF Notes due 20259) 259,457 259,457
4.500% Notes due 2025…. 1,056,787 1,056,787
2.500% UF Notes due 2026% 379,035 379,035
3.625% Notes due 2027 1,448,857 1,448,857
2.869% Notes due 2029 128,889 128,889
3.000% Notes due 2029 ….oocoociccoann o… 1,087,948 1,087,948
3.150% Notes due 2030 989,397 989,397
3.750% Notes due 2031 796,958 796,958
2.840% Notes due 2034″. 63,911 63,911
5.625% Notes due 2035 492,351 492,351
6.150% Notes due 2036 496,634 496,634
3.580% Notes due 2039). 49,674 49,674
4.250% Notes due 2042 733,779 733,779
5.630% Notes due 2043…. 933,822 933,822
4.875% Notes due 2044 961,709 961,709
4.50% Notes due 2047.. 1,206,523 1,206,523
4.85% Notes due 2048 594,559 594,559
4.375% Notes due 2049 1,183,684 1,183,684
3.700% Notes due 2050 . 1,835,908 1,835,908
Notes offered hereby. – 500,000
Total non-current financial liabilities…… s 18,627,304 s 18,527,304
Non-controlling interest…… Ss 919,458 $ 919,458
Equity
Issued capital. s 5,619,423 $ 5,619,423
Other reserve: 5,272,097 5,272,097
Retained Earnings
Accumulated deficit… (134,156) (134,156)
Profits distributions to the Chilean Treasury – –
Equity attributable to equity owners of the parent ……… $ 10,757,364 Ss 10,757,364
Total capitalization”…. $ 31,245,484 $ 31,145,484

31
0)
0)
6)
(4)
(5)

(6)
(0)

The U.S.$ equivalent of €600 million aggregate principal amount of the 2.25% Euro Notes due 2024 has been translated at an exchange rate of
U.S.$1.00 =€0.8538 at September 30, 2020.

The U.S.$ equivalent of 6.9 million UF aggregate principal amount of the 4.0% UF notes due 2025 has been translated at an exchange rate of
U.S.$1.00 =0.027454 UF at September 30, 2020.

The U.S.$ equivalent of 10 million UF aggregate principal amount of the 2.5% UF notes due 2026 has been translated at an exchange rate of
U.S.$1.00 =0.027454 UF at September 30, 2020.

The U.S.$ equivalent of HKD 500 million aggregate principal amount of the 2.84% notes due 2034 has been translated at an exchange rate of
U.S.$1.00 = HKD 7.7500 at September 30, 2020.

The U.S.$ equivalent of AUD 70 million aggregate principal amount of the 3.580% notes due 2039 has been translated at an exchange rate of
U.S.$1.00 = AUD 1.3957 at September 30, 2020.

Net of deferred financing costs, commissions to the initial purchasers and payment of legal fees and all other expenses related to the offering.
CODELCO has no convertible debt securities, warrants exercisable for debt securities or other similar securities outstanding.

32
EXCHANGE RATES

As a general matter, prior to 1989, Chilean law permitted the purchase and sale of foreign exchange only in
those cases explicitly authorized by the Central Bank of Chile. Law 18,840, the Central Bank of Chile Act,
liberalized the rules that govern the purchase and sale of foreign currency. The act empowers the Central Bank to
determine that certain purchases and sales of foreign currency specified by law must be carried out in the Mercado
Cambiario Formal (the “Formal Exchange Market”). The Formal Exchange Market is formed by the banks and
other entities so authorized by the Central Bank. The exchange rate of the transactions conducted in the Formal
Exchange Market is freely agreed upon by the parties thereto. For more information, see “Foreign Investment and
Exchange Controls in Chile.” The observed exchange rate for any given day equals the average exchange rate of the
transactions conducted in the Formal Exchange Market on the immediately preceding banking day, as certified by
the Central Bank (the “Observed Exchange Rate”). Even though the Central Bank is authorized to carry out its
transactions at the rates it sets, it generally uses the spot rate for its transactions. Authorized transactions by other
banks are generally carried out at the spot rate.

Purchases and sales of foreign exchange, which may be effected outside the Formal Exchange Market, can
be carried out in the Mercado Cambiario Informal (the “Informal Exchange Market”). There are no limits imposed
on the extent to which the exchange rate in the Informal Exchange Market may fluctuate above or below the
Observed Exchange Rate.

The following table sets forth, for the periods indicated, the high, low, average and period-end Observed
Exchange Rate for U.S. dollars for each year beginning in 2015 as reported by the Central Bank of Chile. The

Federal Reserve Bank of New York does not report a noon buying rate for Chilean pesos.

Observed Exchange Rates

(Ch$ per U.S.$)
Period High Low” Average” Period-End*
715.66 597.10 654.25 707.34
730.31 645.22 676.83 667.29
679.05 615.22 649.33 615.22
698.56 588.28 640.29 695.69
828.25 649.22 702.63 744.62
820.68 764.97 793.62 816.36
821.23 754.45 784.73 754.45
803.40 757.06 784.66 779.92
788.02 760.01 773.40 784.46
October… 801.91 770.45 788.27 770.45
Novembes 772.83 752.01 762.88 766.69
December (through December 7, 2020) …….. 767.29 747.61 756.49 747.61

(1) Rates shown are the actual low and high (as applicable) on a daily basis for periods indicated.

(2) The average annual rates represent the average of average monthly rates for the periods indicated. The average monthly rates represent the
average of the rates on each day for the periods indicated.

(3) Period ends on January 1 of the following year.
Source: Central Bank of Chile.

The Observed Exchange Rate reported by the Central Bank of Chile for December 7, 2020 was Ch$747.61
=U.S.$1.00.

33
SELECTED CONSOLIDATED FINANCIAL DATA

The following tables present CODELCO”s summary consolidated financial data and other data as of and
for each of the periods indicated. This data (other than the average LME copper prices) is derived from, and should
be read together with, CODELCO”s Consolidated Financial Statements, including the notes thereto, included
elsewhere in this offering memorandum. This data should also be read together with “Management’s Discussion and
Analysis of Financial Condition and Results of Operations.” The Consolidated Financial Statements and other
financial information included in this offering memorandum are presented in accordance with IFRS. The unaudited
consolidated interim information as of September 30, 2020 and for the nine-month periods ended September
30, 2019 and 2020 includes all adjustments, consisting of only normal recurring adjustments. The unaudited results
of operations for the nine-month periods ended September 30, 2019 and 2020 are not necessarily indicative of the
results to be expected for the full year or any other period.

For the nine-month periods ended
For the year ended December 31, September 30,

2017 2018 2019 2019 2020

(in thousands of U.S.$)

CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME

Revenue….. – $ 14,641,555 $ 14,308,758 $ 12,524,931 $ 8,808,184 $ 9,228,639
Cost of sales”. (10,380,403) (11,194,341) (10,051,441) (7,256,283) (7,310,693)
Gross profit 4,261,152 3,114,417 2,473,490 1,551,901 1,917,946
Other income, by function … 154,332 124,826 360,690 206,981 75,253
Impairment loss determined in accordance
with IFRS 9 … N/A 158 378 1,176 (934)
Distribution costs (10,403) (18,262) (17,069) (12,647) (6,995)
Administrative expenses (428,140) (465,328) (409,234) (303,025) (262,416)
Other expenses? . (1,557,473) (2,115,314) (1,747,838) (1,328,133) (969,845)
Other gains …. 32,605 21,395 22,672 17,038 18,264
Finance income 29,836 51,329 36,871 22,504 35,412
Finance costs… (644,610) (463,448) (479,307) (360,104) (520,374)
Share of profit of associates and joint
ventures accounted for using equity
185,428 119,114 13,203 11,863 9,713
Foreign exchange differences. (206,058) 178,143 153,917 114,946 136,947
Profit (loss) for the period before tax 1,816,669 547,030 407,773 (77,500) 432,971
Income tax expense(…. (1,193,067) (357,283) (393,245) (20,499) (361,048)
Profit (loss) for the period. 623,602 189,747 14,528 (97.999) 71,923
Profit (loss) attributable to owners of the
parent… 569,175 155,719 6,637 (105,530) 64,656
Profit (loss) attributable to non-controlling
interests ……….. 54,427 34,028 7,891 7,531 7,267
Profit (loss) for the period…. $ 623,602 $ 189,747 $ 14,528 $ (97,999) $ 71,923
As of December 31 As of September 30,
2017 2018 2019 2020
CONSOLIDATED STATEMENTS OF
FINANCIAL POSITION (in thousands of U.S.$)
Total current assets….. mm. 6,211,053 $ 5,828,206 $ 6,050,021 $ 8,138,783
Total property, plant and equipment!*”. 25,275,512 26,754,998 29,700,164 29,787,583
Investments accounted for using equity
method”… 3,665,601 3,568,293 3,483,523 3,470,552
Non-current receivables 91,442 84,731 98,544 91,160
All other assetsÚ” 1,112,533 854,577 1,012,359 918,391
Total assets … 36,356,141 $ 37,090,805 $ 40,344,611 $ 42,406,469
Total current liabilities 3,315,456 3,539,412 3,922,957 3,217,793
Total non-current liabil 22,115,347 22,207,524 24,786,987 27,511,854
Total liabilities…… 25,430,803 $ 25,746,936 $ 28,709,944 $ 30,729,647

34

Non-controlling interests…… 1,007,495 969,204 919,757 919,458
Equity attributable to owners of the parent 9,917,843 10,374,665 10,714,910 10,757,364

Total equity . 10,925,338 $ 11,343,869 $ 11,634,667 $ 11,676,822
Total liabilities and equity. 36,356,141 $ 37,090,805 $ 40,344,611 $ 42,406,469

As of and for the nine-month periods

ended
As of and for the year ended December 31, September 30,
2017 2018 2019 2019 2020
(in thousands of U.S.S, except ratios and copper prices)

OTHER ITEMS
Depreciation and amortization of
ASS cocarcnnrconnnnos $ 2,101,101 $ 2,181,140 $ 2,220,069 S 1,585,427 $ 1,787,130
Interest expense, net S (614,774) $ (412,119) $ (442,436) S (337,600) $ (484,962)
Ratio of earnings to fixed charges
(adjusted) O 3.8 3.0 1.9 0.8 1.8
Average LME copper price (U.S. £

per pound)””. 279.7 295.9 272.1 274.0 265.3
Adjusted EBITDA’* S 5,668,314 S 4,695,792 S 4,042,748 S 2,554,746 $ 3,436,711
Ratio of debt to Adjusted
EBITDAS .. 26 3.2 43 N/A N/A
Adjusted EBITDA coverage

9.2 11.4 9.1 7.6 7.1

0)

Q)

6)

(4)

(5)

(6)

(0)
(8)

“Cost of sales” for any period includes direct and indirect costs, depreciation and amortization associated with the production of copper and
byproducts, as well as purchase costs of third-party copper, sold by CODELCO in that period.

“Other expenses” is comprised principally of costs related to the 10% special export tax paid by the Company, retirement plan and
severance indemnities and fixed indirect costs below production level. See note 22.b of the Consolidated Financial Statements and
“Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

CODELCO is subject to a mining tax on operating income at progressive rates of between 5% and 14%. The tax is imposed on operating
income generated during the operating year. The statutory rate of the mining tax for CODELCO was 5.0% for each year between 2017 and
2019. In addition, CODELCO is subject to the corporate income tax rate of 24% in 2016 and 25% since 2017 (pursuant to the tax reform in
2014) and a 40% tax on net earnings applicable to state-owned enterprises as specified by Decree Law 2,398, Art. 2. See “Taxation—
Chilean Taxation” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital
Resources—Distributions to the Chilean Treasury” for additional information. See note 5 of the Consolidated Financial Statements and
“Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources—
Distributions to the Chilean Treasury” and “Regulatory Framework.” See also “Risk Factors—Risks Relating to CODELCO”s Relationship
with the Government of Chile—CODELCO is subject to special taxes” for information regarding the mining tax rate effective in 2016.

See note 9 of the Consolidated Financial Statements and the Unaudited Interim Consolidated Financial Statements and “Management’s
Discussion and Analysis of Financial Condition and Results of Operations.”

All other assets includes other non-current financial assets, other non-current non-financial assets, accounts receivable from related parties,
non-current, non-current inventories, intangible assets other than goodwill, investment property, non-current tax assets and deferred tax
assets.

For the purpose of calculating CODELCOS*s ratio of earnings to fixed charges (adjusted), (i) “earnings” consist of Adjusted EBIT and (ii)
“fixed charges” consist of finance cost. The ratio of earnings to fixed charges (adjusted) is calculated by dividing Adjusted EBIT by finance
cost. Adjusted EBIT is calculated by adding finance cost, impairment charges net of reversals (as defined in note (1) of the following table)
and income tax expense to profit (loss) for the period. Adjusted EBIT, while not a financial performance measure under IFRS, is presented
as an indicator of funds available to service debt. Adjusted EBIT and Adjusted EBITDA data are included in this offering memorandum
because such data are used by investors to assess: (i) the operating trends and financial performance of the Company and (ii) the ability of
the Company to (a) service its existing debt, (b) incur new debt and (c) fund its capital expenditures. The Company believes that Adjusted
EBIT, while providing useful information, should not be considered in isolation as a substitute for profit for the period, as an indicator of
operating performance, or as an alternative to cash flow as a measure of liquidity. Additionally, the Company”s calculation of Adjusted
EBIT may be different than the calculation used by other companies and therefore, comparability may be affected. See notes 8, 21 and 22 of
the Consolidated Financial Statements and Unaudited Interim Consolidated Financial Statements and “Management’s Discussion and
Analysis of Financial Condition and Results of Operations” for further information about impairment charges and reversals and other
non-cash charges.

Average price on the LME for Grade A cathode copper during period.

Adjusted EBITDA is calculated by adding finance cost, income tax expense, depreciation and amortization of assets plus export taxes and
impairment charges net of reversals (as defined in note (1) of the following table) to profit (loss) for the period. Adjusted EBITDA is
presented because it is a widely accepted indicator of funds available to service debt, although it is not an IFRS-based measure of liquidity
or performance. Adjusted EBIT and Adjusted EBITDA data are included in this offering memorandum because such data are used by
investors to assess: (i) the operating trends and financial performance of the Company and (ii) the ability of the Company to (a) service its

35
(9)

(10)

existing debt, (b) incur new debt and (c) fund its capital expenditures. The Company believes that Adjusted EBITDA, while providing
useful information, should not be considered in isolation or as a substitute for profit as an indicator of operating performance, or as an
alternative to cash flow as a measure of liquidity. Additionally, the Companys calculation of Adjusted EBITDA may be different than the
calculation used by other companies and therefore, comparability may be affected. See notes 8, 21 and 22 of the Consolidated Financial
Statements and Unaudited Interim Consolidated Financial Statements and “Management’s Discussion and Analysis of Financial Condition
and Results of Operations” for further information about impairment charges and reversals and other non-cash charges.

The ratio of debt to Adjusted EBITDA is calculated by dividing debt by Adjusted EBITDA. Debt is defined as loans from financial
institutions plus bonds issued.

Adjusted EBITDA coverage ratio is the ratio of Adjusted EBITDA to finance cost net of finance income. See note 9 above for further
information about Adjusted EBITDA and notes 21 and 22 of the Consolidated Financial Statements and Unaudited Interim Consolidated
Financial Statements and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for further
information about impairment charges and reversals and other non-cash charges.

(11) In the unaudited interim consolidated financial statements, as of and for the nine- and three-month periods ended September 30, 2020 and

2019, certain reclassifications were made to the statement of financial position as of December 31, 2019 which, with respect to property,
plant and equipment, included a break-out of right-of-use assets into a separate line. The amounts for property, plant, and equipment in the
table above, therefore, represent the sum of property, plant and equipment and right-of-use assets.

The following table shows CODELCO”s earnings, Adjusted EBIT, ratio of earnings to fixed charges

(adjusted), Adjusted EBITDA and reconciliation of Adjusted EBIT and Adjusted EBITDA for the periods indicated.

Profit (loss) for the period

For the nine-month periods ended
For the year ended December 31, September 30,

2017 2018 2019 2019 2020
(in thousands of U.S.$)

Ss 623,602 $ 189,747 Ss 14,528 $ (97,999) $ 71,923

Income tax expense……. 1,193,067 357,283 393,245 20,499 361,048
Finance costs ……….. 644,610 463,448 479,307 360,104 520,374
Impairments!”.. 7,378 395,965 – – –
Adjusted EBITO 2,468,657 1,406,443 887,080 282,604 953,345
Ratio of earnings to fixed charges

(adjusted)O 3.8 3.0 19 0.8 1.8
Depreciation and amortization of assets*” …. 2,101,101 2,181,140 2,220,069 1,585,427 1,787,130
Copper Reserve Law 1,098,556 1,108,209 935,599 686,715 696,296

Adjusted EBITDA …

0

Q)

6)

(4)
6)

$ 5,668,314 $ 4,695,792 $ 4,042,748 S 2,554,746 $ 3,436,771

Impairments include charges and reversals related to charges of investment projects, research projects and investment in associates and joint
ventures and exclude impairment charges related to definitely-lived tangible assets which show indicators of impairment under International
Accounting Standard N? 36. See notes 8, 21 and 22 of the Consolidated Financial Statements and Unaudited Interim Consolidated Financial
Statements and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for further information about
impairment charges and reversals and other non-cash charges.

Adjusted EBIT is calculated by adding finance cost, impairment charges net of reversals (as defined in note (1) above) and income tax
expense to profit (loss) for the period. Adjusted EBIT, while not a financial performance measure under IFRS, is presented as an indicator
of funds available to service debt. Adjusted EBIT and Adjusted EBITDA data are included in this offering memorandum because such data
are used by investors to assess: (i) the operating trends and financial performance of the Company and (ii) the ability of the Company to (a)
service its existing debt, (b) incur new debt and (c) fund its capital expenditures. The Company believes that Adjusted EBIT, while
providing useful information, should not be considered in isolation as a substitute for profit for the period, as an indicator of operating
performance, or as an alternative to cash flow as a measure of liquidity. Additionally, the Company”s calculation of Adjusted EBIT may be
different than the calculation used by other companies and therefore, comparability may be affected. See notes 8, 21 and 22 of the
Consolidated Financial Statements and Unaudited Interim Consolidated Financial Statements and “Management’s Discussion and Analysis
of Financial Condition and Results of Operations” for further information about impairment charges and reversals and other non-cash
charges.

For the purpose of calculating CODELCOS*s ratio of earnings to fixed charges (adjusted), (i) “earnings” consist of Adjusted EBIT and (ii)
“fixed charges” consist of finance cost. The ratio of earnings to fixed charges (adjusted) is calculated by dividing Adjusted EBIT by finance
cost.

See note 20 of the Consolidated Financial Statements and the Unaudited Interim Consolidated Financial Statements.

The Copper Reserve Law currently requires the payment of a 10% special export tax on receivables of the sales proceeds that CODELCO
receives and transfers to Chile from the export of copper and related by products produced by CODELCO. For further information, see
“Risk Factors— Risks Relating to CODELCO”s Relationship with the Government of Chile— CODELCO is subject to special taxes.”

36
The following table shows CODELCO”s debt and ratio of debt to Adjusted EBITDA and Adjusted
EBITDA coverage ratio for the periods indicated.

As of and for the nine-month periods
ended
As of and for the year ended December 31, September 30,

2017 2018 2019 2019 2020

(in thousands of U.S.S, except ratios)

$ 14,709,790 $ 15,257,685 $ 17,264,356 $ 17,453,362 $ 19,568,662

Ratio of debt to Adjusted EBITDA 2.6 3.2 43 N/A N/A
Finance income… 29,836 51,329 36,871 22,504 35,412
Adjusted EBITDA coverage ratio ………….. 9.2 11.4 9.1 7.6 7.1

(Mm Adjusted EBITDA coverage ratio is the ratio of Adjusted EBITDA to finance cost net of finance income.

37
SELECTED OPERATING DATA
The following table sets forth a summary of the production and sales data of CODELCO for each of the
years ended December 31, 2017, 2018 and 2019 and for the nine-month periods ended September 30, 2019 and
2020. For more information regarding such data, see “Business Properties.”

For the nine-month periods

ended
Year ended December 31, September 30,
2017 2018 2019 2019 2020
COPPER MINING OPERATIONS
Ore Mined (in thousands of dry metric
tons):
Mina Ministro Hales 23,653 19,827 19,160 14,375 14,482
Chuquicamata Division 50,104 56,909 65,582 48,181 46,340
Radomiro Tomic Divisio. 78,582 77,692 70,753 52,197 52,270
Gabriela Mistral Division 40,503 39,430 38,180 28,807 26,440
El Teniente Division…. 50,812 52,454 52,006 38,305 38,351
Andina Division. 31,863 29,264 30,676 22,670 25,737
Salvador Division . 14,513 12,892 10,362 7,785 8,080
290,029 288,467 286,718 212,319 211,699
Average Copper Ore Grad:
Mina Ministro Hales 1.08% 1.09% 0.99% 0.97% 1.00%
Chuquicamata Division 0.77 0.62 0.73 0.68 0.75
Radomiro Tomic Divisio 0.51 0.53 0.48 0.49 0.44
Gabriela Mistral Division 0.43 0.37 0.42 0.39 0.41
El Teniente Division 0.98 0.96 0.95 0.93 0.94
Andina Division. 0.78 0.75 0.67 0.67 0.71
Salvador Division . 0.56 0.59 0.63 0.62 0.65
Weighted Average 0.71% 0.67% 0.67% 0.66% 0.68%
PLANT COPPER PRODUCTION
(by division in metric tons):
Mina Ministro Hales ….. 215,086 195,485 151,838 110,588 112,801
Chuquicamata Division 330,910 320,744 385,309 262,091 299,752
Radomiro Tomic Division 318,878 332,667 266,415 197,889 182,068
Gabriela Mistral Division 122,737 107,247 104,087 72,182 74,226
El Teniente Division …. 464,328 465,040 459,744 323,896 312,961
Andina Division . 220,030 195,531 170,274 125,939 142,334
61,942 60,840 50,561 27,130 40.935
1,733,911 1,677,554 1,588,229 1,119,715 1,165,078
PLANT COPPER PRODUCTION
(contained copper in metric tons):
ER Cathodes…. 65,579 44,308 10,228 2,834 40,902
SX-EW Cathodes 442,136 410,649 395,998 285,001 275,184
Calcined. 159,113 152,653 116,999 81,610 94,854
Anodes — Blister. 381,526 386,393 338,769 206,075 261,600
Concentrates….. 685,557 683,551 726,235 544,195 492,540
1,733,911 1,677,554 1,588,229 1,119,715 1,165,077
MOLYBDENUM PRODUCTION
(contained molybdenum in metric tons)…….. 28,674 24,031 22,353 16,036 21,456
COPPER SALES
(in metric tons; includes sales of
third-party copper):
Cathodes… 1,233,012 1,231,172 1,076,097 742,651 898,697
Fire Refined. – – – – –
Anodes — Blister 118,986 135,509 58,491 21,839 58,000
Concentrates 610,852 529,292 721,339 548,527 420,912
Total 1,962,850 1,895,974 1,855,926 1,313,016 1,377,609

COPPER EXPORTS

38
(in metric tons; includes sales of
third-party copper):

Cathodes…… 1,164,459 1,173,010 1,009,355 707,916 832,279
Blister… 118,986 133,499 57,487 21,839 57,266
Concentrates 515,214 379,398 503,424 408,529 282,895
1,798,659 1,685,906 1,570,266 1,138,284 1,172,440
INVENTORIES OF COPPER AT
PERIOD-END
(in metric tons) 54,448 80,233 38,375 45,267 29,102

39
MANAGEMENT”S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS

The following discussion should be read in conjunction with CODELCO’s Consolidated Financial
Statements, including the notes thereto, included elsewhere in this offering memorandum, as well as the data set
forth in “Selected Consolidated Financial Data.” Except as otherwise disclosed herein or indicated, the
Consolidated Financial Statements and other financial information included in this offering memorandum are
presented in accordance with 1FRS.

Overview

CODELCO is the world”s largest copper producer and one of the largest companies in Chile in terms of
revenues. CODELCO engages primarily in the exploration, development and extraction of ore-bearing copper and
byproducts, the processing of ore into refined copper and the international sale of refined copper and byproducts. In
2019, CODELCO derived 91% of its total sales from copper and 9% of its total sales from byproducts of its copper
production, primarily molybdenum, anodic slimes and sulfuric acid.

Since its inception in 1976, CODELCO has contributed approximately U.S.$108.1 billion (in
2019 currency) to the Chilean Treasury. Approximately 62.7% of this amount was generated in the last 16 years,
representing 8.4% of the revenues of the Government of Chile. In 2019, CODELCO accounted for 13.4% of all
Chilean exports.

CODELCOSs financial performance is significantly affected by the market prices of copper. As with prices
for other commodities, copper prices have historically been subject to wide fluctuations. LME copper prices
averaged 272.1 cents per pound in 2019 compared to 295.9 cents per pound in 2018 and 279.7 cents per pound in
2017. Copper prices averaged 265.3 cents per pound in the first nine months of 2020, compared to 274.0 cents per
pound in the first nine months of 2019. Since the first half of 2018 copper prices have been affected by trade
disputes between the United States and China. For more information, see “Overview of the Copper Market.”

CODELCO continues to focus on controlling and limiting production cost increases. For many years,
CODELCO has been within the first or second quartiles in the industry with respect to costs. Currently, CODELCO
is in the third quartile of the industry?s cost curve. This position is primarily attributable to the quality of its ore
bodies, its economies of scale and the experience of its workforce and management. The Company intends to make
every effort, through investment and management, to be within the first or second quartiles of the industry?s cost
curve in the long-term. In 2019, CODELCO*s total costs and expenses decreased by 11.6 cents per pound (4.7%) to
233.5 cents per pound, compared to 245.1 cents per pound in 2018 and 227.1 cents per pound in 2017, mainly due to
depreciation of the Chilean peso against the U.S. Dollar, cost savings in maintenance expenses and lower labor
expenses, partially offset by lower production levels in connection with weather disruptions in the northern area of
Chile, a 14-day strike at the Chuquicamata mine and upgrades at the Chuquicamata and Salvador smelters that
suspended operations temporarily. For the first nine months of 2020, CODELCO’s total costs and expenses
decreased by 11.3 cents per pound (4.7%) to 228.3 cents per pound, compared to 239.7 cents per pound for the same
period in 2019, mainly due to lower input prices, such as electricity and diesel, depreciation of the Chilean peso
against the U.S. Dollar and higher production volume.

In 2019, CODELCOSs total costs and expenses decreased to U.S.$8.2 billion, compared to U.S.$9.1 billion
in 2018, due to depreciation of the Chilean peso against the U.S. Dollar and a decline of sales volume and cost
cutting initiatives. In 2018, CODELCOSs total costs and expenses increased by 4.4% to U.S.$9.1 billion, compared
to U.S.$8.7 billion in 2017 mainly due to the appreciation of the Chilean peso against the U.S. dollar, as well as
higher input prices, non-cash charges related to the write-off of an innovation project for underground mining and
impairment losses on fixed assets associated with the Ventanas Division. For the first nine months of 2020,
CODELCOS*s total costs and expenses amounted to U.S.$5.9 billion, which was relatively flat as compared to the
same period of 2019. Higher depreciation and amortization expenses and finance costs partially offset the favorable
effect on total costs and expenses from the depreciation of the Chilean peso against the U.S. Dollar and the lower
input prices. In 2019, CODELCO*s cash cost of production was 141.6 cents per pound, compared to 139.1 cents per
pound in 2018 and 135.9 cents per pound in 2017. For the first nine months of 2020, CODELCO”s cash cost of
production was 126.9 cents per pound, compared to 143.1 cents per pound for the same period in 2019. In 2019,

40
CODELCOSS total cash cost was U.S.$4.9 billion, compared to U.S.$5.1 billion in 2018 and U.S.$5.1 billion in
2017. For the first nine months of 2020, CODELCO’s total cash cost was U.S.$3.2 billion, as compared to
U.S.$3.5 billion for the same period in 2019, primarily attributable to lower input prices, such as electricity and
diesel, depreciation of the Chilean peso against the U.S. Dollar and higher production volume. See “Management’s
Discussion and Analysis of Financial Condition and Results of Operations—Overview.”

CODELCO conducts hedging operations from time to time to reduce the risks associated with copper price
volatility. CODELCO also periodically enters into futures contracts with respect to certain sales of its own copper.
Since 2005, CODELCO has occasionally hedged certain future copper delivery commitments and production in
order to manage the risks associated with copper price volatility. As of September 30, 2020, CODELCO did not
have any production hedging commitments and, accordingly, there was no related impact on pre-tax income for the
nine-month period ended September 30, 2020. See notes 29 and 30 to the Unaudited Interim Consolidated Financial
Statements.

CODELCO has hedged a portion of its exchange rate and interest rate exposure by entering into forward
exchange contracts to hedge against fluctuations in the UF to U.S. dollar exchange rate for its outstanding
UF-denominated bonds. See “Business and Properties—Marketing—Pricing and Hedging” and “Risk Factors—
Risks Relating to CODELCO”s Operations—CODELCO engages in hedging activity from time to time, particularly
with respect to its copper production, which may not be successful and may result in losses to CODELCO.” See also
notes 27 and 28 to the Consolidated Financial Statements and notes 29 and 30 to the Unaudited Interim
Consolidated Financial Statements for further information on CODELCO”s hedging activity.

Sale prices for CODELCO”s products are established principally by reference to prices quoted on the LME
and the New York Commodity Exchange (“COMEX”) in the case of copper, or prices published in “Metals
Weekly” in the case of molybdenum. The substantial majority of copper produced by CODELCO is sold under
annual contracts to customers who have long-term relationships with CODELCO. Pricing under such contracts is
based on prevailing average copper prices for a quotation period, generally for the month following the scheduled
month of shipment. Revenue under such contracts is recorded at provisional prices determined at the time of
shipment. Usually, an adjustment is then made after delivery of the copper, based on the pricing terms contained in
the applicable contract.

CODELCOSs financial performance is also significantly affected by the relationship of copper prices to
production costs. In 2019, CODELCO”s annual production, including its investment in El Abra and Anglo American
Sur, slightly decreased to 1.71 million metric tons from 1.81 million metric tons in 2018 and 1.84 million metric
tons in 2017. The lower production levels in 2019 were in connection with weather disruptions in the northern area
of Chile, a 14-day strike at the Chuquicamata mine and upgrades at the Chuquicamata and Salvador smelters that
suspended operations temporarily. The lower production in 2018 was mainly due to lower production at the Andina,
Mina Ministro Hales, Gabriela Mistral and Chuquicamata Divisions, partially offset by increased production at the
Radomiro Tomic Division and CODELCO”s stake in Anglo American Sur and El Abra.

In 2019, each one-cent change in CODELCO” average annual copper price per pound caused a variation in
operating profit of approximately U.S.$35 million. CODELCO expects production to remain relatively stable in the
near future. By overcoming certain non-permanent disruptions, such as inclement weather and other natural events
and strikes, and producing more copper through the new Mina Ministro Hales ore body, CODELCO believes that it
will be able to compensate for diminished production resulting from lower average ore grades, which themselves are
expected to stabilize over time. Nonetheless, CODELCO continues to develop its project pipeline with the goal of
increasing its production marginally in the long-term.

CODELCO continues to develop and refine its mine management practices and programs to limit and
reduce its costs. These include the following: (1) improved deposit identification and mining techniques; (ii) the
implementation of early retirement plans and workforce reduction programs; (iii) an investment in human capital
and continuing to attract and retain a world-class management team and professionals of the highest caliber;
(iv) improved utilization of equipment and inputs used in the processes of copper production to increase productivity
and efficiency; and (v) the development of key projects, specifically the new mine level at El Teniente, the Andina
plant reallocation and the Chuquicamata underground mine projects. Production cash costs are influenced by mining

41
and production practices, as well as the type of ore from which copper is produced, production levels and market
prices of byproducts, and foreign exchange rates.

In 2019, CODELCO invested U.S.$3.7 billion, mainly in expansion and development projects, including
the Chuquicamata underground mine, the Andina plant reallocation, the new mine level at El Teniente and the
upgrade of Chuquicamata, Salvador and El Teniente smelters. See “Business and Properties.”

In addition to selling its current production of copper, CODELCO may sell copper in its inventory from
past production cycles to meet the demand of its customers. CODELCO also purchases copper from third parties in
the spot market for resale. The Company makes these purchases and sales of third-party copper to meet the
requirements under sales contracts and to participate in the spot market for copper based on its evaluation of market
conditions. CODELCO has no long-term commitments regarding third-party copper purchases or sales other than
pursuant to the joint venture with China Minmetals Non-Ferrous Metals Co. Ltd. (“Minmetals”), a Chinese
state-owned metals company. This joint venture ended in April 2016 and the related selling commitment ends in
2021. For more information on Minmetals, see “Business and Properties—Associations, Joint Ventures and
Partnerships.” CODELCO also engages in copper transactions with its affiliates at market terms. In addition,
CODELCO purchases copper from its affiliates for further processing and resale.

The following tables set forth, for the periods indicated, the components of CODELCO”s consolidated
financial statements of operations expressed as a percentage of revenue under IFRS. These tables are qualified in
their entirety by reference to, and should be read together with, CODELCO”s Consolidated Financial Statements,
including the notes thereto, included elsewhere in this offering memorandum:

For the nine-month periods

ended
Year ended December 31, September 30,
2017 2018 2019 2019 2020
Revenue. 100.0% 100.0% 100.0% 100.0% 100.0%
Cost of sale: (70.9) (78.2) (80.3) (82.4) (79.2)
Gross profit. 29.1 21.8 19.7 17.6 20.8
Other income, by function. 1.1 0.9 2.9 2.3 0.8
Administrative expenses (Q.9) (3.3) (3.3) (3.4) (2.8)
Other expenses (10.6) (14.8) (14.0) (15.1) (10.5)
Finance costs (4.4) (3.2) (3.8) (4.1) (5.6)
Profit (loss) for the period before tax.. 12.4 3.8 3.3 (0.9) 4.7
Income tax expense….. (8.1) (Q.5) (3.1) (0.2) (3.9)
Profit (loss) for the period… 4.3% 1.3% 0.1% (1.0% 0.8%

The following tables set forth, for the periods indicated, certain price, volume and cost data:

For the nine-month periods ended

Year ended December 31, September 30,
2017 2018 2019 2019 2020
CODELCO Average Metal
Price (per pound)”
Copper …. Ss 2.86 $ 2.76 $ 2.56 $ 2.58 $ 2.62
Molybdenum . s 7.88 $ 11.64 $ 11.37 $ 12.03 $ 8.13
CODELCO Sales Volume (in
metric tons)
Own copper (2) e. 1,846,452 1,838,150 1,804,005 1,277,440 1,317,994
Third-party copper……. 304,026 296,109 172,218 124,804 132,176
Total copper… e 2,150,478 2,134,259 1,976,223 1,402,244 1,450,170
Molybdenum (in oxid:
28,918 25,385 23,775 17,226 21,376
135.98 139.1€ 141.6£ 143.1é 126.9é
(0) The average metal price is the weighted average of prices actually paid to CODELCO for its product mix.
(0) Includes wire rod sales and cathodes from CODELCOSs subsidiaries.

42
Impact of COVID-19

The COVID-19 pandemic and the resulting economic impact have primarily contributed to a decrease in
copper prices in 2020. In the first nine months of 2020, LME copper prices averaged 265.3 cents per pound
compared to 274.0 cents per pound in the first nine months of 2019, which was attributable to the impact of the
COVID-19 pandemic on the Chinese and global economies during the first nine months of 2020. CODELCO”s
financial results and prospects are largely dependent on the prices of copper. If economic conditions further
deteriorate in China or other emerging markets, demand from customers in those markets could decline and the
market price of copper could fall. A decline in copper prices would have an adverse impact on CODELCO”s
revenues and financial results.

CODELCO has taken steps and implemented several measures to safeguard its employees, businesses and
the communities surrounding its operations from the threats posed by the COVID-19 pandemic. Although these
steps and measures have not materially affected CODELCO*s production or its financial results in 2020, the ultimate
impact of COVID-19 on CODELCO*s financial and operating results is unknown and will depend on the duration
and spread of the pandemic, and will not be fully reflected in CODELCOSs results of operations until future periods.

Results of Operations for the Nine-month Periods Ended September 30, 2019 and 2020

The following table sets forth CODELCO”s summarized results of operations for the nine-month periods
ended September 30, 2019 and 2020:

For the nine-month periods ended

September 30, % Change
2019 2020 2019/2020
(in millions of U.S.$)
Revenue $ 8,808 Ss 9,229 4.8%
Cost of sales. (7,256) (7,3311) 0.7
Gross profit. 1,552 1,918 23.6
Other income, by function. 207 75 (63.6)
Administrative expenses … (303) (262) (13.4)
Other expenses (1,328) (970) (27.0)
Finance costs (360) (520) 44,5
Share of profit of associates and joint ventures accounted for using

equity method …. 12 10 (18.1)
Foreign exchange differences 115 137 19.1
Profit (loss) for the period before tax (78) 433 658.7
Income tax expens8 .occonconinnonacnnnnnos (20) (361) 1,661.3
Profit (loss) for the period (98) 7 173.4
Profit (loss) attributable to owners of parent (106) 65 161.3
Profit (loss) attributable to non-controlling interestS…..cooconncinnnnnnmmmmm. 8 7 (3.5)

Revenue. The following table sets forth CODELCO”s revenue for the nine-month periods ended September
30, 2019 and 2020:

For the nine-month periods ended

September 30, % Change
2019 2020 2019/2020
(in millions of U.S.$)

Revenue $ 8,808 $ 9,229 4.8%
Sales of CODELCO”s own copper.. 7,268 7,608 4.7%
Sales of third-party copper …… 724 784 8.3%
Sales of byproducts and other. 816 837 2.5%

Revenues increased by 4.8% to U.S.$9.2 billion in the first nine months of 2020, compared to
U.S.$8.8 billion for the same period in 2019. This increase was primarily attributable to an increase in the volume of
copper sold by 3.4% as a result of higher production levels. Our own copper sales increased by 4.7% mainly due to

43
3.2% higher volume sold and higher realized copper price. Despite lower average LME copper prices in the first
nine months of 2020 as compared to the same period of 2019, realized copper price for CODELCO was higher due

to lower transformation, refining and logistics charges.

Third-party copper sales totaled U.S.$784 million in the first nine months of 2020, compared to
U.S.$724 million for the same period of 2019, attributable to an increase of sales volume. In general, changes in the
volume of third-party copper sales are dependent upon CODELCO”s need to meet requirements under sales
contracts and, to a lesser extent, purchasing copper under spot market terms if CODELCO”s own production is

insufficient to cover the quantities that it has agreed to supply its customers.

Sales of byproducts and other increased 2.5% to U.S.$837 million in the first nine months of 2020,
compared to U.S.$816 million for the same period in 2019. This increase was primarily due to the 24.1% growth in

molybdenum sales volume.

Cost of sales. CODELCO”s cost of sales in any period includes both the mining and production costs of its
own copper and byproducts and the purchase costs of copper, as well as gold, silver and other byproducts, at market
prices from third parties and processed and sold by CODELCO in that period. The following table sets forth

CODELCOSs total cost of sales for the nine-month periods ended September 30, 2019 and 2020:

For the nine-month periods ended

September 30, % Change
2019 2020 2019/2020
(in millions of U.S.$)

Cost of sales.. AS 7,256 $ 7,311 0.7%
Cost of CODELCO’”s own copper. 6,073 6,002 (1.2)
Cost of third-party sales ………… 2. 7117 784 9.3
Cost of byproducts and OtheT .ococicincononninninnnnncnnncnocncncinnococeorarenos 466 524 12.6

CODELCOS*s total cost of sales increased by 0.7% to U.S.$7.3 billion (79.2% of sales) in the first nine
months of 2020, compared to U.S.$7.3 billion (82.4% of sales) for the same period in 2019, primarily due to higher
sales volume. Some of the minerals that CODELCO sells are purchased at market prices, and CODELCO also

purchases mineral ore from third parties at market prices which it processes and sells as copper.

CODELCOSs cost of sales of its own copper decreased to U.S.$6.0 billion during the first nine months of
2020, compared to U.S.$6.1 billion for the same period in 2019. This decrease is primarily attributable to lower
operational costs as a result of cost reduction efforts and the depreciation of the Chilean peso against the U.S. dollar,

which decreased wage and third-party services expenses.

The cost of copper purchased from third parties increased by 9.3% in the first nine months of 2020 to
U.S.$784 million, compared to U.S.$717 million for the same period of 2019. The increase was mainly caused by

higher sales volume of third-party copper.

The cost of byproducts and other increased by 12.6% to U.S.$524 million in the first nine months of 2020,
compared to U.S.$466 million for the same period of 2019, primarily due to higher sales volume of molybdenum,

sulfuric acid, gold and silver.

Depreciation and amortization expenses increased by 12.7% to U.S.$1.8 billion during the first nine months
of 2020, compared to U.S.$1.6 billion for the same period in 2019. This increase was primarily due to higher
production since the amounts recognized in property, plant and equipment are depreciated under a

units-of-production method, as well as large capitalizations over 2019.

Gross profit. Gross profit amounted to U.S.$1.9 billion for the first nine months of 2020, compared to
U.S.$1.6 billion for the same period in 2019. This 23.6% increase was primarily attributable to the increase in
revenues mainly due to higher sales volume of copper and molybdenum, which was only partially offset by an

increase of 0.7% in cost of sales.

44
Other income, by function. The largest components of other income, by function, are sales of services to
third parties, insurance reimbursements received and gains on sales of assets. Other income, by function decreased
63.6% to U.S.$75 million in the first nine months of 2020, compared to U.S.$207 million for the same period in
2019, primarily attributable to the sale of CODELCO”s 37% equity stake in GNL Mejillones S.A. in 2019, which
did not repeat in 2020.

Administrative expenses. Administrative expenses decreased to U.S.$262 million (2.8% of total revenues)
during the first nine months of 2020, compared to U.S.$303 million (3.4% of total revenues) for the same period in
2019. This decrease was primarily attributable to the positive effect of the depreciation of the Chilean peso against
the U.S. dollar.

Other expenses. Other expenses amounted to U.S.$970 million (10.5% of total revenues) during the first
nine months of 2020, compared to U.S.$1,328 million (15.1% of total revenues) for the same period in 2019. This
decrease was primarily attributable to a decrease of bonuses paid related to collective bargaining processes and of
indirect fixed costs.

The following table sets forth the principal components of CODELCO’s other expenses for the periods
indicated:

For the nine-month periods ended September

30,
2019 2020
(in millions of U.S.$)
Copper Reserve Law $ 687 $ 696
Bonus for the end of collective bargaining and other employee benefits 182 131
Other expenses 460 143
Total other expenses by FUNCtiON ooo rerrrerrar $ 1,328 $ 970

CODELCO recorded other expenses of U.S.$687 million and U.S.$696 million in the first nine months of
2019 and 2020, respectively, pursuant to the Copper Reserve Law, which levies a 10% tax on CODELCO*s exports
of its own copper and related byproducts. Under the accounting policies adopted by CODELCO, this export tax is
accounted for in “other expenses.” The increase of this tax recorded in the first nine months of 2020 compared to the
same period in 2019 is primarily attributable to higher revenues from CODELCO”s own copper sales.

Bonuses for the end of collective bargaining and other employee benefits decreased to U.S.$131 million
from U.S.$182 million, due to a smaller number of employees benefitting from collective bargaining negotiations in
2020.

Other expenses (as a sub-category of other expenses as a whole) decreased from U.S.$460 million to
U.S.$143 million, mainly due to a decrease in indirect fixed costs from U.S.$312 million during the first nine
months of 2019 to U.S.$47 million in the first nine months of 2020.

Finance costs. Finance costs increased to U.S.$520 million in the first nine months of 2020, compared to
U.S.$360 million for the same period in 2019. This increase was primarily attributable to higher average debt
amount in 2020 than in 2019. The average interest rate was 4.0% as of September 30, 2020. As of September 30,
2020, 90% of our debt had a fixed rate and 10% had a floating rate.

Share of profit/(loss) of associates and joint ventures accounted for using equity method. CODELCO”s net
equity participation in related companies decreased to a net profit of U.S.$10 million in the nine months of 2020,
compared to a net profit of U.S.$12 million for the same period in 2019. This decrease was primarily attributable to
the decrease of sales volumes which negatively impacted the El Abra deposit and Anglo American Sur”s
profitability.

Foreign exchange differences. According to Decree Law 1,350, CODELCO maintains its accounting
records in U.S. dollars, recording transactions in currencies other than U.S. dollars at the exchange rate current at the

45
date of each transaction and, subsequently, for monetary assets and liabilities denominated in currencies other than
the U.S. dollar, at the closing exchange rate determined by the Central Bank of Chile. CODELCO experienced a
gain from foreign exchange differences of U.S.$137 million in the first nine months of 2020, compared to a gain
from foreign exchange differences of U.S.$115 million in the same period of 2019. The gain recorded in the first
nine months of 2020 is primarily attributable to the depreciation of the Chilean peso against the U.S. dollar during
the nine-month period ended September 30, 2020 as compared to December 31, 2019, arising mainly from long term
provision denominated in Chilean pesos.

Profit before tax. Profit before tax was U.S.$433 million during the first nine months of 2020, compared to
a loss of U.S.$78 million for the same period in 2019, primarily attributable to higher gross profit and positive
foreign exchange differences, partially offset by higher finance costs.

Income tax expense. During the first nine months of 2020, CODELCO had a statutory tax rate of 65.0% in
accordance with applicable regulations, comprised of (i) a corporate income tax rate of 25.0% and (ii) a 40% tax on
net earnings applicable to state-owned enterprises as specified by Decree Law 2,398, Art. 2. During 2019,
CODELCO was subject to the same statutory tax rate of 65%. CODELCO is also subject to an additional mining tax
that is based on its operating income, and, effective as of 2012 fiscal year, is imposed at progressive rates of between
5% and 14%. CODELCOSs statutory rate of the mining tax for 2019, 2018 and 2017 was 5%. CODELCO”s taxes on
income amounted to an expense of U.S.$361 million during the first nine months of 2020 and an expense of U.S.$20
million during the same period of 2019. The increase in expense from taxes on income was primarily due to the
profits before tax generated during the first nine months of 2020.

Profit for the period. As a result of the factors described above, CODELCOS’s profit after tax was U.S.$72
million during the first nine months of 2020, compared to a loss of U.S.$98 million for the same period of 2019.

Results of Operations for the Three Years Ended December 31, 2019

The following table sets forth CODELCO”s summarized results of operations for the years ended
December 31, 2017, 2018 and 2019:

Year ended December 31, % Change
2017 2018 2019 2017/2018 2018/2019
(in millions of U.S.$)

Revenue … 14,642 14,309 12,525 Q.3)% (12.5)%
(10,380) (11,194) (10,051) 7.8 (10.2)
4,261 3,114 2,473 (26.9) (20.6)
Other income, by function. 154 125 361 (19.1) 189.0
Administrative expenses (428) (465) (409) 8.7 (12.1)
Other expenses . (1,557) (2,115) (1,748) 35.8 (17.4)
Finance costs . (645) (463) (479) (Q8.1) 3.4

Share of profit (loss) of associates and joint

ventures accounted for under the equity
MethOd..ococccconccnnnnrinnrnions 185 119 13 (35.8) (88.9)
Foreign exchange differences (206) 178 154 (186.5) (13.6)
Profit (loss) for the period before tax. 1,817 547 408 (69.9) (25.5)
Income tax expense … (1,193) (357) (393) (70.1) 10.1
Profit (loss) for the pet . . 624 190 15 (69.6) (92.3)

Profit (loss) attributable to owners of paren
569 156 7 (72.6) (95.7)

Profit (loss) attributable to non-controlling
interests….. 54 34 8 (37.5) (76.8)

Revenue. The following table sets forth CODELCO”s revenues for the years ended December 31, 2017,
2018 and 2019:

Year ended December 31, % Change
2017 2018 2019 2017/2018 2018/2019
(in millions of U.S.$)
REVUE coconcnncnnncnnnconrnnnrnoncon ran corras ren res rnenreros S 14,642 $ 14,309 $ 12,525 Q.3)% (12.5)%

46
Sales of CODELCO”s own copper. 11,635 11,219 10,402 (3.6) (7.3)
Sales of third-party copper .. 2,006 1,901 1,006 (5.2) (47.1)
Sales of byproducts and Other …oconcincinncnnnnnoos 1,001 1,189 1,116 18.8 (6.1)

In 2019, revenue decreased by 12.5% to U.S.$12.5 billion, compared to U.S.$14.3 billion in 2018. This
decrease was primarily attributable to a decrease in CODELCO”s average copper price from U.S.$2.76 per pound in
2018 to U.S.$2.56 per pound in 2019 and a decrease in the volume of copper sold by 7.3% as a result of lower
production levels. Our own copper sales decreased by 7.4% mainly due to the decrease in CODELCO”s average
copper price. Revenue decreased in 2018 by 2.3% to U.S.$14.3 billion, compared to U.S.$14.6 billion in 2017,
mainly due to a 3.5% decrease in CODELCO’s copper price to 276 cents per pound in 2018 from 286 cents per
pound in 2017. CODELCO”s own copper sales decreased 3.6% to U.S.$11.2 billion in 2018, compared to U.S.$11.6
billion in 2017, primarily attributable to the 3.4% decrease in CODELCO”s copper price and a 0.4% reduction in the
tonnage volume sold.

Third-party copper sales totaled U.S.$1.0 billion in 2019, compared to U.S.$1.9 billion in 2018, attributable
to lower average copper prices and a decline of sales volume. In 2018, third-party copper sales totaled U.S.$1.9
billion, compared to U.S.$2.0 billion in 2017. The decrease in 2018 as compared to 2017 was primarily attributable
to a 3.4% decrease in CODELCO”s copper price and a 2.6% decrease in tonnage sold. In general, changes in the
volume of third-party copper sales are dependent upon CODELCO”s need to meet requirements under sales
contracts and, to a lesser extent, purchasing copper under spot market terms if CODELCO”s own production is
insufficient to cover the quantities that it has agreed to supply its customers.

Sales of byproducts and other decreased by 6.1% to U.S.$1.1 billion in 2019, compared to U.S.$1.2 billion
in 2018. This decrease was primarily due to the 6.3% decline in molybdenum sales volume. In 2018, sales of
byproducts and other totaled U.S.$1.2 billion, compared to U.S.$1.0 billion in 2017. The increase of 18.8% in 2018
as compared to 2017 was primarily attributable to a 47.7% increase in CODELCO”s average molybdenum price,
partially offset by a 12.2% decrease in molybdenum tonnage sold.

Cost of sales. CODELCO”s cost of sales in any period includes both the mining and production costs of its
own copper and byproducts and the purchase costs of copper, as well as gold, silver and other byproducts, at market
prices from third parties and processed and sold by CODELCO in that period. The following table sets forth
CODELCOSs total cost of sales for the years ended December 31, 2017, 2018 and 2019:

Year ended December 31, % Change
2017 2018 2019 2017/2018 2018/2019
(in millions of U.S.$)

Cost of SaleS…ococinconinninninnincnnnconos Ss 10,380 $11,194 $ 10,051 7.8% (10.2)%
Cost of CODELCO’s own copper. 7,793 8,646 8,418 10.9 (2.6)
Cost of third-party sales……… 2,000 1,881 996 (5.9) (47.0)
Cost of byproducts and other. Qe 588 667 637 13.5 (4.5)

CODELCO*s total cost of sales decreased by 10.2% to U.S.$10.1 billion (80.3% of sales) in 2019,
compared to U.S.$11.2 billion (78.2% of sales) in 2018, primarily due to lower sales volume, in addition to
operational cost reduction efforts and the depreciation of the Chilean peso against the U.S. dollar, which positively
impacted wages and third-party services expenses. In 2018, CODELCO*s total cost of sales increased 7.8% to
U.S.$11.2 billion (78.2% of sales) compared to U.S.$10.4 billion (70.9% of sales) in 2017, mainly due to higher
operational costs arising from the appreciation of the Chilean peso against the U.S. dollar. Some of the minerals that
CODELCO sells are purchased at market prices, and CODELCO also purchases mineral ore from third parties at
market prices which it processes and sells as copper.

CODELCOSs cost of sales of its own copper decreased to U.S.$8.4 billion in 2019, compared to U.S.$8.6
billion in 2018. This decrease is primarily attributable to lower sales volume in addition to lower operational costs as
the result of cost reduction efforts and the depreciation of the Chilean peso against the U.S. dollar, which decreased
wage and third-party services expenses. In 2018, CODELCO*s cost of sales of its own copper increased by 10.9% to
U.S.$8.6 billion compared to U.S.$7.8 billion in 2017. The increase in 2018 compared to 2017 was primarily

47
attributable to the higher production cost due to the appreciation of the Chilean peso against the U.S. dollar and
higher fuel and energy costs.

The cost of copper purchased from third parties decreased by 47.0% in 2019 to U.S.$996 million,
compared to U.S.$1.9 billion in 2018. The decrease was caused by lower sales volume of third-party copper and by
a decrease in the average price of copper. In 2018, the cost of copper purchased from third parties decreased by
5.9% to U.S.$1.9 billion compared to U.S.$2.0 billion in 2017 primarily attributable to lower volumes of copper
purchased and lower average copper price.

The cost of byproducts and other decreased by 4.5% to U.S.$637 million in 2019, compared to U.S.$667
million in 2018, primarily due to lower sales volume of molybdenum, sulfuric acid, gold and silver. In 2018, the cost
of byproducts and other increased by 13.4% to U.S.$667 million in 2018 compared to U.S.$588 million in 2017.
The increase in 2018 compared to 2017 was principally attributable to higher operational costs arising from the
appreciation of the Chilean peso against the U.S. dollar and higher fuel and energy costs.

Depreciation and amortization expenses increased by 1.8% to U.S.$2.2 billion in 2019, a slight increase
compared to 2018. In 2018, depreciation and amortization expenses increased by 3.8% to U.S.$2.12 billion
compared to U.S.$2.1 billion in 2017. The increases are mainly due to higher capital expenditures.

Gross profit. Gross profit amounted to U.S.$2.5 billion in 2019, compared to U.S.$3.1 billion in 2018. The
20.6% decrease was primarily attributable to the decrease in revenues, mainly due to lower average price received
for CODELCO*s product mix and lower sales volume of copper and molybdenum, partially offset by the decrease in
the cost of sales mainly due to lower sales volumes and cost reduction efforts. In 2018, gross profit amounted to
U.S.$3.1 billion, compared to U.S.$4.3 billion in 2017. The decrease in 2018 as compared to 2017 was primarily
attributable to the higher operational costs, a 3.4% decrease in CODELCO”s copper price and a 0.8% decrease in
copper tonnage sold, partially offset by an increase in 18.8% of by-products revenues mainly due to an increase in
the average price of CODELCO*s product mix.

Other income, by function. The largest components of other income, by function, are sales of services to
third parties, insurance reimbursements received and gains on sales of assets. Other income, by function increased
189.0% to U.S.$361 million in 2019, compared to U.S.$125 million in 2018, primarily attributable to miscellaneous
sales and sales of assets. In 2018, other income decreased by 19.1% to U.S.$125 million compared to U.S.$154
million in 2017. The decrease in 2018 was primarily attributable to the absence of insurance indemnity in 2018 as
well as a decrease in in miscellaneous sales, partially offset by the profit on the sale of CODELCO”s 40% stake in
Deutsche Giessdraht GmbH to Aurubis. See note 22a to the Consolidated Financial Statements.

Administrative expenses. Administrative expenses decreased to U.S.$409 million (3.3% of total revenues)
in 2019, compared to U.S.$465 million (3.3% of total revenues) in 2018. This decrease was primarily attributable to
the positive effect of the depreciation of the Chilean peso against the U.S. dollar. In 2018, administrative expenses
increased to U.S.$465 million (3.3% of total revenues) compared to U.S.$428 million (2.9% of total revenues) in
2017 The increases in 2018 compared to 2017 was mainly due to the appreciation of the Chilean peso against the
U.S. dollar.

Other expenses. Other expenses amounted to U.S.$1.7 billion (14.0% of total revenues) in 2019, compared
to U.S.$2.1 billion (14.8% of total revenues) in 2018. This decrease was primarily attributable to a decline of the
amount of special export tax payments due to a lower average copper price, a decrease of bonuses paid related to
collective bargaining processes and the absence of non-cash charges related to a U.S.$138.1 million write-off in
connection with an underground mining innovation project in 2018, partially offset by the increase in indirect fixed
costs. In 2018, other expenses amounted to U.S.$2.1 billion (14.8% of revenues), compared to U.S.$1.6 billion
(10.6% of revenues) in 2017. The increase in 2018 as compared to 2017 was primarily attributable to a non-cash
charge related to a write-off of an underground mining innovation project amounting to U.S.$138 million, an
impairment recognition in the Ventanas Division amounting to U.S.$199 million and the increase in collective
bargaining bonuses.

The following table sets forth the principal components of CODELCO’s other expenses for the periods
indicated:

48
Year ended December 31,

2017 2018 2019
(in millions of U.S.$)

Copper Reserve LW. $ (1,099) $ (1,108) $ (936)
Bonus for the end of collective bargaining and
Employee Benefits … (53) (269) (250)
Asset impairments …. (0) (199) –
Other non-cash charges (89) Q17) (42)
Other expenses.. 617) (3622) (519)

Total… $ (1,557) $ (2,115) $ (1,748)

CODELCO recorded other expenses of U.S.$0.9 billion, U.S.$1.1 billion and U.S.$1.1 billion in 2019,
2018, and 2017, respectively, pursuant to the Copper Reserve Law, which levies a 10% tax on receivables of the
sales proceeds that CODELCO receives and transfers to Chile from the export of copper and related byproducts
produced by CODELCO. The decrease of this tax recorded in 2019 compared to 2018 is primarily attributable to
lower revenues from CODELCO””s own copper sales

In 2019, bonuses for the end of collective bargaining and other employee benefits decreased to U.S.$250
million from U.S.$269 million in 2018, due to a smaller number of employees benefitting from collective bargaining
negotiations in 2019. Other expenses increased from U.S.$322 million in 2018 to U.S.$519 million in 2019 due to
an increase in indirect fixed costs. In 2018, CODELCO recorded a U.S.$199 million impairment loss of certain
items of property, plant and equipment related to the Ventanas Division due a decline in, and deterioration in the
outlook for, treatment and refining charges.

Finance costs. Finance costs in 2019 increased to U.S.$479 million, compared to U.S.$463 million in 2018.
This increase was primarily attributable to costs incurred in connection with the consummation of the tender offer in
September 2019. In 2018, finance costs amounted to U.S.$463 million, compared to U.S.$645 million in 2017. The
decrease in 2018 as compared to 2017 was primarily attributable to a higher capitalization of interest related to
certain investment projects and a decrease in financial expenses that had previously increased due to costs incurred
in connection with the consummation of the tender offer in August 2017. CODELCO*s debt level was U.S.$17.3
billion as of December 31, 2019, U.S.$15.3 billion as of December 31, 2018 and U.S.$14.7 billion as of December
31, 2017. CODELCO”s average interest rate was 4.21% as of December 31, 2019 and 4.34% as of December 31,
2018. As of December 31, 2019, 86% of our debt had a fixed rate and 14% had a floating rate. As of December 31,
2018, 88% of CODELCOS”s debt had a fixed rate and 12% had a floating rate. See “Selected Consolidated Financial
Data” for information regarding debt during the years ended December 31, 2017, 2018 and 2019.

Share of profit/(loss) of associates and joint ventures accounted for using equity method. CODELCO”s net
equity participation in related companies decreased to a net profit of U.S.$13 million in 2019, compared to a net
profit of U.S.$119 million in 2018. This decrease was primarily attributable to the decrease in the average copper
price which negatively impacted the El Abra deposit and Anglo American Sur”s profitability, as well as production
losses due to weather disruptions in the northern area of Chile. In 2018, CODELCO*s net equity participation in
associates and joint ventures accounted for using the equity method was a profit of U.S.$119 million, compared to a
profit of U.S.$185 million in 2017. The decrease in 2018 as compared to 2017 was primarily attributable to lower
income from CODELCO” stake in Anglo American Sur. See note 8 to the Consolidated Financial Statements.

Profit (loss) before tax. In 2019, profit before tax decreased to U.S.$408 million, compared to U.S.$547
million in 2018. This decrease was primarily attributable to the decrease in the average copper price and lower sales
volume. Profit before tax was U.S.$547 million in 2018, compared to a profit of U.S.$1.8 billion in 2017. The
decrease in 2018 as compared to 2017 was primarily attributable to slightly lower sales combined with higher selling
and administrative expenses, a non-cash charge related to a write-off of an underground mining innovation project in
2018, an impairment recognition in the Ventanas Division and the impact of end of bargaining bonuses.

Income tax expense. In 2019, CODELCO had a statutory tax rate of 65.0% in accordance with applicable
regulations, comprised of (i) a corporate income tax rate of 25.0% (a 17% historic corporate tax rate applied to
income earned in and prior to 2011 but changed by means of the 2014 tax reform) and (ii) a 40% tax on net earnings
applicable to state-owned enterprises as specified by Decree Law 2,398, Art. 2. During 2018, CODELCO was

49
subject to the same statutory tax rate of 65%. CODELCO is also subject to an additional mining tax that is based on
its operating income, and, effective as of fiscal year 2012, is imposed at progressive rates of between 5% and 14%.
CODELCOS*s statutory rate of the mining tax for 2019, 2018 and 2017 was 5%. CODELCO”s taxes on income
amounted to an expense of U.S.$393 million in 2019, compared to an expense of U.S.$357 million in 2018 and
U.S.$1.2 billion in 2017, primarily as a result of a decrease in CODELCO”s pre-tax profit in 2019 as compared to
2018 and 2017. For more information regarding this payment, see note 5 to the Consolidated Financial Statements
and “Risk Factors—Risks Relating to CODELCO”s Relationship with the Government of Chile—CODELCO is
subject to special taxes.”

Profit for the period. As a result of the factors described above, CODELCO recorded a profit after tax of
U.S.$15 million in 2019, U.S.$190 million in 2018 and U.S.$624 million in 2017.

Liquidity and Capital Resources

CODELCO”s primary sources of liquidity are funds from (i) operations, (ii) domestic and international
borrowings from banks and (iii) debt offerings in the domestic and international capital markets. CODELCO is
generally required to transfer its profit to the Chilean Treasury. The calculation of profit and other comprehensive
income includes certain non-cash generating charges or benefits. Significant non-cash generating charges or benefits
are deferred tax expense/benefit and amortization and depreciation recorded against other comprehensive income
and/or profit and loss. For the nine-month period ended September 30, 2020, non-cash charges were U.S.$2 million
in amortization and U.S.$1,785 million in depreciation. Non-cash deferred tax charges of U.S.$336 million were
recorded for the nine-month period ended September 30, 2020. Specifically with respect to deferred taxes, non-cash
charges or benefits are generated by recording the fluctuation of the deferred tax assets and liabilities, which may be
recorded against other comprehensive income in equity or through profit and loss. Amortization and depreciation are
recorded directly in profit and loss.

In June 2014, the Ministries of Finance and Mining approved the capitalization of U.S.$200 million
through a retention of CODELCOSs profits from 2013. In October 2014, the multi-year capitalization law approved
by the Chilean Congress was promulgated and became effective following its publication in the Official Gazette.
This law allocates a maximum of U.S.$3 billion to CODELCO in the form of a capital injection by the Chilean
Treasury over the period from 2014 to 2018. Pursuant to this law, CODELCO must present a yearly progress report
on the BDP for the 2014-2018 period to the Ministries of Finance and Mining and to the Finance Committee of both
the Upper House and the Lower House of Congress by March 30 of each year. The BDP report details the progress
of CODELCO”s investments, including information about their financing and execution, covering each of the
structural projects and their corresponding investments. The BDP report also discusses CODELCO”s progress with
respect to production, costs and results. On the same date that the multi-year capitalization law was promulgated, the
President of Chile announced a commitment to authorize the retention by CODELCO of up to an additional U.S.$1
billion of profit (which includes the U.S.$200 million that had been authorized in June 2014) over the 2014-2018
period.

In accordance with this commitment, in June 2015, the Ministries of Finance and Mining approved the
capitalization of U.S.$225 million of 2014 profit, but charged to 2015 profits. However, due to CODELCO’s
operating losses in 2015, this capitalization has not been implemented. Nonetheless, pursuant to the multi-year
capitalization law, the Government of Chile authorized a capital injection of U.S.$600 million (out of the maximum
U.S.$3 billion for the 2014-2018 period), which was received in U.S. dollars in December 2015. In December 2016,
the Ministries of Finance authorized the capitalization of U.S.$975 million, U.S.$500 million of which related to a
capital injection to finance CODELCO’”s investment plan and was received in December 2016. The remaining
U.S.$475 million was authorized pursuant to a new law (Law 20,989), effective as of January 2017, which provided
for additional capitalization of a maximum of U.S.$950 million for both 2016 and 2017 (up to U.S.$475 million for
each year) in the event CODELCO does not have the required pre-tax profits to cover the 10% special export tax
under the Copper Reserve Law. In April 2017, CODELCO received the U.S.$475 million capital injection in U.S.
dollars for 2016.

Law 20,989 also extended the U.S.$3 billion capitalization commitment for the 2014-2018 period to 2019.

While CODELCO did not expect additional capital injections in connection with Law 20,989 during 2017, in
November 2017, the Government of Chile authorized a capital injection of U.S.$520 million (out of the maximum

50
U.S.$3 billion for the newly extended 2014-2019 period), which was received in U.S. dollars in December 2017. In
June 2018, the Government of Chile announced a final capital injection of U.S.$1 billion to complete the multi-year
capitalization law approved in October 2014. Moreover, in October 2018, the Government of Chile authorized the
disbursement of such amount in two installments completed on December 31, 2018 for U.S.$600 million and on
February 28, 2019 for the remaining U.S.$400 million.

Since 2014, the Government of Chile has authorized the capitalization by capital injection and retention of
profit within CODELCO in an aggregate amount of U.S.$3.5 billion, U.S.$225 million of which could not be
implemented. See “Risk Factors—Risks Relating to CODELCO”s Relationship with the Government of Chile—
CODELCOS”s funding through retention of profits is restricted and is subject to the approval of the Ministries of
Finance and Mining.”

Cash flows. In 2019, net cash flows from operating activities decreased by 38.3% to U.S.$2.4 billion from
U.S.$3.9 billion in 2018. This decrease in net cash flows from operating activities resulted primarily due to the
decrease in cash received from the sales of goods because of a deterioration in CODELCO’”s average product
portfolio prices and sales volumes. For the year ended December 31, 2018, net cash flows from operating activities
decreased to U.S.$3.9 billion, compared to U.S.$4.7 billion in 2017. The decrease in net cash flows from operating
activities during 2018 was primarily attributable to an increase in payments to suppliers and employees, partially
offset by higher cash received from sales of goods. During the first nine months of 2020, net cash flows from
operating activities totaled U.S.$ 2.4 billion, which was flat as compared to the same period of 2019. Lower
payments to suppliers and employees in the period due to more favorable input prices and local currency
depreciation were offset by higher tax payments (since March 2020, CODELCO has been paying the Copper
Reserve Law tax on a monthly basis, while in 2019 it was paid in the fourth quarter). See note 28 to the Unaudited
Interim Consolidated Financial Statements and note 28 to the 2017-2018 Consolidated Financial Statements.

Bank debt. CODELCOSs total financial debt (defined as loans from financial institutions plus bonds issued)
as a percentage of its total capitalization was 57.4% as of December 31, 2017, 57.4% as of December 31, 2018,
59.7% as of December 31, 2019 and 62.6% as of September 30, 2020. CODELCO” s total outstanding financial debt
as of December 31, 2017, 2018 and 2019 and as of September 30, 2020 was U.S.$14.7 billion, U.S.$15.3 billion,
U.S.$17.3 billion and U.S.$19.6 billion, respectively.

In May 2012, CODELCO entered into a two-tranche U.S. dollar unsecured bilateral loan, each tranche with
a commitment fee of 15.0 basis points per annum with a maturity date of (i) ten years for the Japan Bank for
International Cooperation loan and (ii) seven years for The Bank of Tokyo-Mitsubishi UFJ, Ltd., to be disbursed by
the lenders on a pro rata basis, for the development, construction and operation of a metals processing plant to be
constructed in Mejillones and the export of certain metals to Japanese customers pursuant to long-term offtake
agreements. The terms of the loans are described below:

Availability
Credit Amount Interest Rate Period

Japan Bank for International Cooperation. U.S.$224.0 million LIBOR plus 45.0 basis points 36 months
The Bank of Tokyo—Mitsubishi UFJ, Ltd.. U.S.$96.0 million LIBOR plus 55.0 basis points 36 months

As of September 30, 2020, U.S.$64 million was outstanding under the loan described above with Japan
Bank for International Cooperation, and we had repaid in full the loan described above with The Bank of Tokyo
Mitsubishi UFJ, Ltd. As of September 30, 2020, CODELCO had amortized U.S.$160 million of the loan with the
Japan Bank for International Cooperation.

Between October and November 2016, CODELCO rolled over loans with The Bank of Tokyo-Mitsubishi
UFJ, Ltd. for U.S.$250 million and Export Development Canada for U.S.$300 million, increasing the original
principal by an additional U.S.$50 million. The loans mature in five years and the terms are described below:

Credit Amount Interest Rate
The Bank of Tokyo—Mitsubishi UFJ, Ltd………. U.S.$250.0 million LIBOR plus 75.0 basis points
Export Development Cadada..oooocicicncncnnnnnnnincno. U.S.$300.0 million LIBOR plus 62.0 basis points

51
The Bank of Tokyo—Mitsubishi UFJ, Ltd. Loan was fully prepaid in January 2020 and the Export
Development Canada Loan was fully prepaid in August 2020.

In April 2017, CODELCO entered into a short-term U.S. dollar unsecured bilateral bank loan with
Scotiabank 8 Trust (Cayman) Ltd. and used the proceeds to prepay a loan from Bank of America N.A. for U.S.$300
million in full. In May 2017, CODELCO exchanged the short-term loan with Scotiabank £ Trust (Cayman) Ltd. for
a five-year U.S. dollar unsecured bilateral bank loan. In July 2017, CODELCO rolled over a loan with Export
Development Canada for U.S.$300 million. The new loans mature in five years and the terms and interest rates are
described below:

Credit Amount Interest Rate
Scotiabank $ Trust (Cayman), Ltd..o.oononicic….. U.S.$300.0 million LIBOR plus 65.0 basis points
Export Development Cadada..oooocicicncncnnnnnnnincno. U.S.$300.0 million LIBOR plus 62.0 basis points

As of September 30, 2020, U.S.$300 million was outstanding under the loan described above with
Scotiabank $ Trust (Cayman), Ltd. and U.S.$300 million was outstanding under the loan described above with
Export Development Canada.

In October 2018, CODELCO rolled over a loan with Export Development Canada for U.S.$300 million.
The loan matures in 2028 and the terms are described below:

Credit Amount Interest Rate Date Loan Drawn
Export Development Canada…….. U.S.$300.0 million LIBOR plus 121.5 basis points October 2018

As of September 30, 2020, U.S.$299 million was outstanding under the loan described above with Export
Development Canada.

In December 2018, CODELCO entered into a one-year revolving credit facility with Scotiabank Chile for
U.S.$300 million and drew down the full amount. The revolving credit facility may be renewed on a yearly basis
and matures in 2023. The terms are described below:

Credit Amount Interest Rate Date Loan Drawn
Scotiabank Chilé …ooooninicnnnnc… U.S.$300.0 million LIBOR plus 72.5 basis points December 2018

As of September 30, 2020, U.S.$301 million was outstanding under the loan described above with
Scotiabank Chile.

Between March and June 2019, CODELCO entered into six up to one-year advances on export exchange
contracts (ACC). The loans mature between March and May 2020 and the terms are described below:

Credit Amount Interest Rate Date Loan Drawn
Scotiabank Chile. .. … U.S.$100.0 million LIBOR plus 35.0 basis points March 2019
Scotiabank Chile .. U.S.$65.0 million LIBOR plus 35.0 basis points March 2019

Santander Chile. … U.S.$100.0 million LIBOR plus 30.0 basis points April 2019
Itaú Chile …. U.S.$30.0 million LIBOR plus 63.0 basis points June 2019
Banco de Crédito e Inversiones … U.S.$50.0 million LIBOR plus 39.5 basis points June 2019
Banco Chile … .. U.S.$120.0 million LIBOR plus 66.0 basis points June 2019

As of September 30, 2020, none of the loans mentioned above were outstanding. The Scotiabank Chile and
Santander Chile loans described above were repaid in full at their respective maturity dates, while the loans
described above with Banco Chile, Banco de Crédito e Inversiones and Itaú Chile were prepaid in full in December
2019.

52
Between June and December 2019, CODELCO entered into a bilateral credit facility with Export
Development Canada. The credit facility included a commitment fee of 50.0 basis points and matures in 2029.
CODELCO also entered into a seven-year U.S. dollar unsecured bilateral credit facility with the Banco
Latinoamericano de Comercio Exterior. The terms are described below:

Credit Amount Interest Rate Date Loan Drawn
LIBOR plus 121.5 basis
Export Development Canada……. U.S.$300.0 million points July 2019
Banco Latinoamericano de
Comercio ExteriOT…ooccininnininnnc… U.S.$75.0 million LIBOR plus 62.0 basis points December 2019

As of September 30, 2020, U.S.$297 million was outstanding under the loan described above with Export
Development Canada and U.S.$75 million was outstanding under the loan described above with Banco
Latinoamericano de Comercio Exterior.

In April 2020, CODELCO entered into a three-year bilateral credit facility with The Bank of Nova Scotia
for U.S.$165 million, with a commitment fee of 30.0 basis points. The terms are described below:

Credit Amount Interest Rate Date Loan Drawn
. U.S.$165.0 million LIBOR plus 275.0 basis points April 2020

The Bank of Nova Scotia …

This facility was fully prepaid in August 2020.

In May 2020, CODELCO entered into a bilateral credit facility with Export Development Canada. The
credit facility included a commitment fee of 32.0 basis points and matures in 2027. CODELCO also entered into a
three-year U.S. dollar unsecured bilateral credit facility with BNP Paribas, with an advisory fee of U.S.$250,000.00
and a commitment fee of 5.0 basis points. The terms are described below:

Credit Amount Interest Rate Date Loan Drawn
LIBOR plus 115.0 basis
Export Development Canada……. U.S.$300.0 million points May 2020
LIBOR plus 135.0 basis
BNP ParibaS..ococnnicininnnnnnninnincncnos U.S.$100.0 million points May 2020

As of September 30, 2020, U.S.$300 million was outstanding under the loan described above with Export
Development Canada while the BNP Paribas Loan was fully prepaid in August 2020.

Other Debt. In July 2017, CODELCO launched a cash tender offer of any and all of its 7.500% notes due
2019, 3.750% notes due 2020 and 3.875% notes due 2021 and a waterfall cash tender offer for its 3.00% notes due
2022, 4.500% notes due 2023 and 4.500% notes due 2025, which was financed with the proceeds from a concurrent
offering of U.S.$1.5 billion aggregate principal amount of its 3.625% notes due 2027 and U.S.$1.25 billion
aggregate principal amount of 4.500% notes due 2047. Moreover, in January 2019, CODELCO launched a second
cash tender offer for its 3.750% notes due 2020, 3.875% notes due 2021 and 3.00% notes due 2022 and a waterfall
cash tender offer for its 4.500% notes due 2023 and 4.500% notes due 2025, which was financed with the proceeds
from a concurrent offering of U.S.$1.3 billion aggregate principal amount of its 4.375% notes due 2049. Moreover,
in September 2019, CODELCO launched a third cash tender offer for its 3.750% notes due 2020 and 3.875% notes
due 2021 and a waterfall cash tender offer for its 3.00% notes due 2022 and 4.500% notes due 2023, which was
financed with the proceeds from a concurrent offering of U.S.$1.1 billion aggregate principal amount of its 3.000%
notes due 2029 and U.S.$0.9 billion aggregate principal amount of 3.700% notes due 2050. On January 14, 2020,
CODELCO issued notes in an aggregate principal amount of U.S.$2.0 billion, consisting of a U.S.$1.0 billion
international debt offering of 3.150% notes due 2030 and a U.S.$1.0 billion international debt offering of 3.700%
notes due 2050. The notes due 2050 form part of the same series of CODELCO’s outstanding U.S.$900 million
3.700% notes due 2050 issued on September 30, 2019, resulting in a total aggregate principal amount outstanding of
U.S.$1.9 billion in this series. On May 6, 2020, CODELCO issued notes in an aggregate principal amount of

53
U.S.$800 million consisting of its 3.150% notes due 2031. On May 8, 2020, CODELCO issued notes in an
aggregate principal amount of U.S.$131 million, consisting of its 4.500% notes due 2023 issued on August 13,
2013. These notes form part of the same series of CODELCO”s outstanding U.S.$335 million 4.500% notes due
2023 issued on August 13, 2013, resulting in a total aggregate principal amount outstanding of U.S.$466 million in

this series.

The following table shows amounts due by CODELCO under notes issued in both international and local
markets as of September 30, 2020:

Outstanding

Principal Amount and

Principal Accrued Interest Interest

Type of Issuance Maturity Amount as of September 30, 2020 Rate

International November 4, 2020 U.S.$1.00 billion U.S.$401million 3.75%
International November 4, 2021 U.S.$1.15 billion U.S.$230 million 3.88%
International July 17, 2022 U.S.$1.25 billion U.S.$414 million 3.00%
International August 13, 2023 U.S.$750 million U.S.$470 million 4.50%
International July 9, 2024 €600 million U.S.$701 million 2.25%
International September 16, 2025 U.S.$2.00 billion U.S.$1.1 billion 4.50%
Local April 1, 2025 6.9 million UF U.S.$259 million 4.00%
Local August 24, 2026 10 million UF U.S.$380 million 2.50%
International August 1, 2027 U.S.$1.50 billion U.S.$1.5 billion 3.63%
International August 23, 2029 U.S.$130 million U.S.$129 million 2.87%
International September 30, 2029 U.S.$1.10 billion U.S.$1.1 billion 3.00%
International January 14, 2030 U.S.$1.00 billion U.S.$996 million 3.15%
International January 15, 2031 U.S.$800 million U.S.$809 million 3.75%
International November 7, 2034 HKDS500 million U.S.$66 million 2.84%
International September 21, 2035 U.S.$500 million U.S.$493 million 5.63%
International October 24, 2036 U.S.$500 million U.S.$510 million 6.15%
International July 22, 2039 AUD7O million U.S.$50 million 3.58%
International July 17, 2042 U.S.$750 million U.S.$740 million 4.25%
International October 18, 2043 U.S.$950 million U.S.$958 million 5.63%
International November 4, 2044 U.S.$980 million U.S.$981 million 4.88%
International August 1, 2047 U.S.$1.25 billion U.S.$1.2 billion 4.50%
International May 18, 2048 U.S.$600 million U.S.$605 million 4.85%
International February 5, 2049 U.S.$1.30 billion U.S.$1.2 billion 4.38%
International January 1, 2050 U.S.$1.90 billion U.S.$1.8 billion 3.70%

The following table sets forth the scheduled maturities of CODELCO”s bank and unsecured note
obligations as of September 30, 2020:

Loans from financial
institutions..

Bonds issued

Bank and Unsecured Note Obligations Outstanding
(in millions of U.S.$)

Average

More Annual

Less than than Interest

Total 1 year 1-2 years 2-3 years 3-S years _5years Rate
LIBOR+0.9
2,516 391 678 47 94 1,316 9%
17,053 550 638 468 2,013 13,384 4.16%
19,569 941 1,316 515 2,107 14,690

54
In addition to the obligations set forth in the table above, CODELCO was a party to certain commitments primarily
to secure the payment of (i) deferred customs duties and (ii) staff severance indemnities payable upon the retirement
of individual employees, amounting to U.S.$36 million and U.S.$727 million, respectively, as of December 31,
2019 and to U.S.$33 million and U.S.$598 million, respectively, as of September 30, 2020. See notes 16 and 17 to
the Consolidated Financial Statements and to the Unaudited Interim Consolidated Financial Statements. In addition,
as of September 30, 2020, CODELCO believes that its net deferred taxes will reverse as follows: deferred tax
expense in the amount of U.S.$223 million in 2020, U.S.$461 million in 2021 and U.S.$5.2 billion after 2026 and
deferred tax benefit in the amount of U.S.$17 million in 2022, U.S.$277 million in 2023, U.S.$133 million in 2024
and U.S.$330 million in 2025. CODELCO currently has no hedges related to its production of copper through 2019.
See “Business and Properties—Marketing—Pricing and Hedging” and “Risk Factors—Risks Relating to
CODELCOS*s Operations—CODELCO engages in hedging activity from time to time, particularly with respect to its
copper production, which may not be successful and may result in losses to CODELCO.”

CODELCO entered into an agreement with Mitsui on October 12, 2011, pursuant to which Mitsui made
available to Inversiones Mineras Acrux SpA (“Acrux”) a short-term bridge financing facility of up to
U.S.$6.75 billion, guaranteed by CODELCO and subsidiaries of Acrux, as a possible means to fund the exercise of
the Sur Option (as defined in “Business and Properties—Copper Production—Associations, Joint Ventures and
Partnerships”). CODELCO also entered into a separate agreement with Mitsui that provided CODELCO with the
option to repay a portion of the bridge loan from Mitsui through a put option for an indirect 50% stake in the Anglo
American Sur interest acquired, assuming a pre-determined value of U.S.$9.76 billion for the 49% interest in Anglo
American Sur. The balance of the bridge loan would convert into a non-recourse five-year term loan between Acrux
and Mitsui, which would not be guaranteed by CODELCO, and would be repayable only from cash distributions on
the Anglo American Sur shares held by Acrux. In addition, CODELCO and Mitsui entered into a 10-year sale and
purchase agreement for the equivalent of 30,000 tons of fine copper per year subject to market-based pricing terms.

On August 23, 2012, the parties amended and restated the loan agreement described above (the “AS£R
Mitsui Bridge Loan Facility”) pursuant to which Oriente Copper Netherlands B.V. (“Oriente Copper”), an affiliate
of Mitsui, agreed to make available to a wholly-owned subsidiary of CODELCO a bridge loan denominated in U.S.
dollars. On August 24, 2012, the subsidiary of CODELCO drew down an amount equal to U.S.$1,867 million to
finance the acquisition by Inversiones Mineras Becrux SpA (“Becrux”) of equity interests of Anglo American Sur as
described below under “Business and Properties— Copper Production—Associations, Joint Ventures and
Partnerships—Anglo American Sur” and to pay certain taxes, costs and expenses relating to the financing. On
October 31, 2012, CODELCO and Oriente Copper entered into an agreement to refinance the U.S.$1,867 million
bridge loan with a U.S.$875 million non-recourse term loan with a 3.25% fixed interest rate and a 20-year
amortization (the “Mitsui Term Loan”) that is secured by a pledge of the equity interests in Acrux held by such
subsidiary of CODELCO. As part of this refinancing, CODELCO sold to Oriente Copper the equivalent of a 4.5%
stake of Anglo American Sur for U.S.$998 million and used the proceeds of this sale to prepay a portion of the
bridge loan. On November 26, 2016, CODELCO signed a credit agreement with Oriente Copper renegotiating the
payment of principal at the end of the contract. The terms established an annual interest rate of LIBOR +2.5% with a
five-year maturity to be payable in one installment at maturity with semi-annual interest payments. On May 26,
2017, CODELCO signed a new credit agreement with Oriente Copper renegotiating the following semi-annual
payment, which was on the same terms as the first renegotiation done in November 2016. As of September 30, 2020,
the aggregate outstanding balance of the credit agreements is U.S.$580 million.

Capital Expenditure Program. We seek to maintain and improve our competitive position in the industry
through our three-year capital expenditure program. Following the completion of a number of significant projects in
recent years, such as the development of CODELCO”s new Mina Ministro Hales, the development of sulfide ores at
the Radomiro Tomic mine, the expansion at the Andina mine and the development of the Pilar Norte area at the El
Teniente mine, CODELCO intends to continue its development program. Accordingly, the Company expects to
make capital expenditures of approximately U.S.$12.5 billion between 2020 and 2022, transforming its main mining
operations with a view towards the long-term development of its resources. We expect these expenditures to be
funded with a combination of internal and external resources. For a complete list of planned capital expenditures,
see “Business and Properties—Copper Production—Operations.” CODELCO”s expansion and development of
major projects between 2020 and 2022 are expected to include:

e The gradual transformation of the Chuquicamata mine from an open pit mine to an underground

55
operation, which we expect will enable Chuquicamata to maintain its annual copper production at its
current level starting in 2019 (an approximate investment of U.S.$1.4 billion between 2020 and 2022).
Environmental approvals were obtained in September 2010, and the project is approximately 99.5%
complete as of September 30, 2020.

e The reallocation of the Andina plant, which involves maintaining the treatment capacity of the
concentrator plant in the long-term (an approximate investment of U.S.$172 million between 2020 and
2022). Operations are expected to begin in 2021, and the project is approximately 89.1% complete as of
September 30, 2020.

e The development of a new production level in the existing El Teniente underground mine (an
approximate investment of U.S.$2.0 billion between 2020 and 2022) to maintain El Teniente”s annual
copper production at its current level. Environmental approvals were obtained in March 2011. However,
based on geomechanical challenges that need to be addressed, an alternative development plan was
approved in January 2018 that will still permit us to maintain our original production goal and the new
mining level is now expected to be completed in 2023. As of September 30, 2020, the project is
approximately 62.6% complete.

+ The development of the Inca Pit project is designed to extend the life of the current underground mine
operation in the Salvador Division and enable it to maintain its annual production at its current level
starting in 2021 and the analysis for a future expansion, which requires an approximate investment of
U.S.$1.2 billion between 2020 and 2022. As of September 30, 2020, the feasibility study and initial
works have been completed.

+ The expansion of the existing Andina open pit is an initiative that is expected to expand the treatment
capacity of the concentrator plant up to 150 thousand tons per day (an approximate investment
of U.S.$80 million between 2020 and 2022) starting in 2027. As of September 30, 2020, the feasibility
study has been authorized and is approximately 78% complete.

CODELCO has already begun investing in the aforementioned projects. In 2019, CODELCO invested
U.S.$3.7 billion principally in expansion and development projects, including the new El Teniente mine level, the
Chuquicamata underground mine expansion and, the reallocation of the Andina mine-plant pursuant to the Andina
expansion project, as well as in the upgrade of CODELCO”s smelters to comply with the new emission standards.
CODELCO invested U.S.$3.6 billion in 2018 and U.S.$3.5 billion in 2017. For an additional description of
CODELCO’s principal planned capital expenditures, see “Business and Properties—Copper Production—
Operations.”

CODELCO expects that it will have sufficient resources from operations, including cash flows,
capitalization and retention of profits, in addition to new borrowings from banks and the capital markets to fund its
anticipated capital expenditures and investments.

As described under “Regulatory Framework—Overview of the Regulatory Regime” below, the Ministries
of Finance and Mining are required to determine, by means of a joint decree, the amount, if any, that the Company
shall allocate to the creation of capitalization and reserve funds. In June 2014, the Ministries of Finance and Mining
approved the capitalization of U.S.$200 million through a retention of profits from 2013 profits. In October 2014,
the multi-year capitalization law approved by the Chilean Congress was promulgated and became effective
following its publication in the Official Gazette on October 30, 2014. This law allocates a maximum of U.S.$3
billion to CODELCO in the form of a capital injection by the Chilean Treasury over the period from 2014 to 2018.
Pursuant to this law, CODELCO must present a yearly progress report on the BDP for the 2014-2018 period to the
Ministries of Finance and Mining and to the Finance Committee of both the Upper House and the Lower House of
Congress by March 30 of each year. The BDP report details the progress of CODELCO”s investments, including
information regarding their financing and execution, covering each of the structural projects and their corresponding
investments. The BDP report also discusses CODELCO”s progress with respect to production, costs and results. On
the same date that the multi-year capitalization law was promulgated, the President of Chile announced a

56
commitment to authorize the retention by CODELCO of up to an additional U.S.$1 billion of profit (which includes
the U.S.$200 million that had been authorized in June 2014) over the 2014-2018 period.

In accordance with this commitment, in June 2015, the Ministries of Finance and Mining approved the
capitalization of U.S.$225 million of 2014 profit, but charged to 2015 profits. However, due to CODELCO”s
operating losses in 2015, this capitalization has not been implemented. Nonetheless, pursuant to the multi-year
capitalization law, the Government of Chile authorized a capital injection of U.S.$600 million (out of the maximum
U.S.$3 billion for the 2014-2018 period), which was received in U.S. dollars in December 2015. In December 2016,
the Ministries of Finance authorized the capitalization of U.S.$975 million, U.S.$500 million of which related to a
capital injection to finance CODELCO””s investment plan and was received in December 2016. The remaining
U.S.$475 million was authorized pursuant to a new law (Law 20,989), effective as of January 2017, which provided
for additional capitalization of a maximum of U.S.$950 million for both 2016 and 2017 (up to U.S.$475 million for
each year) in the event CODELCO does not have the required pre-tax profits to cover the 10% special export tax
under the Copper Reserve Law. In April 2017, CODELCO received the U.S.$475 million capital injection in U.S.
dollars for 2016. Law 20,989 also extended the U.S.$3 billion capitalization commitment for the 2014-2018 period
to 2019. While CODELCO did not expect additional capital injections in connection with Law 20,989 during 2017,
in November 2017, the Government of Chile authorized a capital injection of U.S.$520 million (out of the maximum
U.S.$3 billion for the newly extended 2014-2019 period), which was received in U.S. dollars in December 2017. In
June 2018, the Government of Chile announced a final capital injection of U.S.$1 billion to complete the multi-year
capitalization law approved in October 2014. Moreover, in October 2018, the Government of Chile authorized the
disbursement of such amount in two installments completed on December 31, 2018 for U.S.$600 million and on
February 28, 2019 for the remaining U.S.$400 million.

See “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Liquidity
and Capital Resources” and “Risk Factors—Risks Relating to CODELCO””s Relationship with the Government of
Chile—CODELCOSs funding through retention of profits is restricted and is subject to the approval of the Ministries
of Finance and Mining.”

Since 2014, the Government of Chile has authorized the capitalization and retention of U.S.$2.5 billion
within CODELCO, U.S.$225 million of which has not been implemented.

Cash flows from operating activities may be affected by a variety of factors, including copper price levels.
In the event that CODELCO is unable to sell assets or obtain external financing with respect to such capital
investments, it may be required to further curtail such expenditures.

Environmental. An important part of CODELCO*s investment policy is its pollution abatement plan, which
includes several environmental projects undertaken to comply with Chilean law and to achieve its own
environmental performance goals. See “Regulatory Framework—Environmental Regulations.”

CODELCO invested U.S.$3.6 billion in environmental projects from 2012 to 2019 and plans to continue
implementing its pollution abatement plan through additional capital investments of approximately U.S.$930 million
in 2020 through 2021. In 2019, CODELCO invested U.S.$833 million in environmental projects, including new
phases of the planned enlargements of the Talabre, Ovejería and Carén tailings dams in the Chuquicamata, Andina
and El Teniente Divisions and various projects in the Chuquicamata, Ventanas, Salvador and El Teniente Divisions
in order to comply with the new regulation on atmospheric emissions from the smelters. This figure includes the
investment made in the Gabriela Mistral Division. CODELCO’s planned investment of approximately U.S.$439
million in 2020 includes the continuation of the enlargement of the Carén, Ovejería and Talabre tailings dams in the
El Teniente, Andina and Chuquicamata Divisions and various projects in the Chuquicamata, Salvador and El
Teniente smelters for the abatement of atmospheric emissions, among others. In 2021, planned investments include
the continuation of the projects for the abatement of atmospheric emissions in the Chuquicamata smelter and the
continued enlargement of the tailing dams, among others. Further, a new air emission standard for smelters was
enacted by the Ministry of the Environment in December 2013. CODELCO*”s cost of complying with this standard
was U.S.$2.4 billion, which was incurred over a period of approximately five years and which started in 2013.

57
The following table sets forth CODELCO”s principal environmental investments in the years 2017-2019:

Environmental Investments
(in millions of U.S.$)

2017 2018 2019 Total
Decontamination plans 433.2 581.6 545.2 1,560.0
Tailing dams.. 183.5 245.9 218.6 648.1
Solid wastes 15.2 9.0 40.9 65.0
Liquid wastes and water management 24.9 15.6 17.1 57.7
OH ÍONS cocconcnncnnncnnnnnrnonronrnonrnornoornannos 6.7 8.9 11.0 26.6
Total ocococacnninnnnnornnncnnnnonrnoncoornon rencor ran renos rnnr rencor rar serranos 663.3 861.0 832.9 2,357.5

Distributions to the Chilean Treasury. As a state-owned enterprise and according to its governing law,
CODELCOSs profit is due to be transferred to the Chilean Treasury. Before June 30 of each year, the Ministries of
Finance and Mining determine, by means of a joint decree, the amount, if any, that the Company must allocate to the
creation of capitalization and reserve funds. Amounts not allocated to the creation of capitalization and reserve funds
are distributed to the Chilean Treasury.

In 2018 and 2017, CODELCO distributed U.S.$602 million and U.S.$273 million, respectively, to the
Chilean Treasury, while in 2019 CODELCO did not distribute dividends. While CODELCO makes advance
payments to the Chilean Treasury throughout the year, funded by cash flows from operating activities, it generally
has distributions payable to the Chilean Treasury at the end of each year. These distributions are paid in the first six-
month period of the following year but are reflected in the prior year”s financial statements.

The following table sets forth amounts paid in taxes (which due to the timing of payments may be different
from tax amounts accrued) and payments and profit distributions made by CODELCO to the Chilean Treasury for
each of the three years ended December 31, 2019 for the nine-month period ended September 30, 2020.

Contributions to the Chilean Treasury

(in millions of U.S.$)
Nine-month period
ended September
Year Ended December 31, 30,
2017 2018 2019 2020
Income tax payments. $ 31 $ 70 $ 82 $ 24
Copper Reserve Law… 1,062 1,137 918 694
Subtotal $ 1,093 $ 1,207 $ 1,000 $ 718
Dividends … 273 602 – –
Total cccicinnornonrnrnrnrnonrnrnrnrnrrrnrrrrrrrrrrrrrnrncnes $ 1,366 $ 1,809 $ 1,000 $ 718

Production Hedging. CODELCO has hedged certain future copper delivery commitments and production
in order to manage the risks associated with copper price volatility in the past. CODELCO currently does not have
any hedged production commitments and therefore there is no relevant impact from hedging. See notes 27 and 28 to
the Consolidated Financial Statements and notes 29 and 30 to the Unaudited Interim Consolidated Financial
Statements. In 2019, CODELCO*s production hedging activities had no negative impact on pre-tax income.

CODELCOSs future production hedging activities could cause it to lose some of the benefit of an increase
in copper prices if copper prices increase over the level of CODELCO””s hedge position, as occurred in 2012. The
cash flows from the mark-to-market values of CODELCO*s production hedges can be affected by factors such as the
market price of copper, copper price volatility and interest rates, which are not under CODELCO*s control.

CODELCOSs production hedging agreements contain events of default and termination events that could
lead to early close-outs of CODELCO’s hedges. These include failure to pay, breach of the agreement,

58
misrepresentation, default under CODELCO” loans or other hedging agreements and bankruptcy. In the event of an
early termination of CODELCO”s hedging agreements, the cash flows from the affected hedge instruments would
cease and CODELCO and the relevant hedge counterparty would settle all of CODELCO”s obligations at that time.
In that event, there could be a lump sum payment to be made either to or by CODELCO. The magnitude and
direction of such a payment would depend upon, among other things, the characteristics of the particular hedge
instruments that were terminated and the market price of copper and copper price volatility and interest rates at the
time of termination.

See “Business and Properties—Marketing—Pricing and Hedging,” “Risk Factors—Risks Relating to
CODELCOS*s Operations—CODELCO engages in hedging activity from time to time, particularly with respect to its
copper production, which may not be successful and may result in losses to CODELCO,” note 28 to the
Consolidated Financial Statements and note 30 the Unaudited Interim Consolidated Financial Statements for further
information on CODELCO”s hedging activity.

Exchange Rates and Interest Rates. CODELCO”s main currency exposure is between the Chilean peso and
the U.S. dollar due to the fact that a significant portion of CODELCO”s operating costs are denominated in Chilean
pesos and paid pursuant to contracts providing for indexation to Chilean inflation, and approximately 100% of
revenue is denominated in U.S. dollars or other foreign currencies. To minimize the risks associated with currency
exposures and fluctuations in interest rates, CODELCO enters into interest rate futures contracts and foreign
exchange forward contracts which reduce exposure to fluctuations in the Chilean peso to U.S. dollar exchange rate.

As of September 30, 2020, CODELCO had swap contracts in place to hedge the risk of future UF/U.S.$,
HKD/U.S.S, AUD/U.S.$ and Euro/U.S.$ exchange rate fluctuations with respect to a notional amount of U.S.$615
million, U.S.$64 million, U.S.$49 million and U.S.$819 million, respectively, which were equivalent to, and
sufficient to cover, 100% of CODELCO*s foreign currency-denominated bonds outstanding as of September 30,
2020.

As of September 30, 2020, 10% of CODELCO”s financial debt was at a variable interest rate and 90% had
a fixed rate.

Controls and Procedures

CODELCO”s management conducted an assessment utilizing The Committee of Sponsoring Organizations
(COSO) criteria of the effectiveness of its internal controls as of the year ended December 31, 2019. Based on the
assessment performed, CODELCO”s management has not identified any material weakness in its control
environment.

New Accounting Standards

The accounting policies adopted in the preparation of the interim consolidated financial statements are
consistent with those applied in the preparation of CODELCO”s annual consolidated financial statements for the
year ended December 31, 2019.

In 2019, CODELCO applied IFRS 16 for the first time. CODELCO applied IFRS 16 with the cumulative
effect of the initial application of the standard, recognized as of January 1, 2019. Consequently, it has not restated
the comparative financial information.

IFRS 16 introduced new or modified requirements with respect to the accounting for leases. It introduced
significant changes to lease accounting for lessees by removing the distinction between operating and financial
leases; required the recognition, at the outset, of an asset for right to use and a lease liability for all leases, except for
short-term leases and leases of low-value assets. In contrast to the accounting for the lessee, the requirements for the
accounting of the lessor remain largely unchanged. The impact of the adoption of IFRS 16 in the consolidated
financial statements of CODELCO is described below.

59
The change in the definition of a lease is mainly related to the concept of control. IFRS 16 determines
whether a contract contains a lease on the basis of whether the client has the right to control the use of an identified
asset for a period of time in exchange for a consideration.

IFRS 16 changes with respect to how CODELCO accounts for leases previously classified as operating
leases under IAS 17, which, with this change, are recognized in the assets and liabilities of the statement of financial
position. CODELCO has re-evaluated all of its contracts at the date of initial application. As a result of the
foregoing, leases have been re-assessed in accordance with the new requirements of IFRS 16.

As of January 1, 2019, CODELCO recognized its leases with the accumulated effect on the date of initial
application, opting to recognize a right to use asset equal to the lease liability. Practical expedients applied in the
transition to operating leases: (a) single discount rate applied to a lease portfolio; (b) short-term and low value lease
exemption for those contracts whose term ends within twelve months from January 1, 2019 and/or are of low value;
and (c) review of contracts under the onerous contract provisions of IAS 37 as an alternative to impairment testing
under IAS 36.

The following table sets the impact of the adoption of IFRS 16 on assets, liabilities and equity as of January
1,2019.

Balances prior to Adjustment Balances adjusted
IFRS 16 IFRS 16 by IFRS 16
(in millions of U.S.$)
Property, plant and equipment (”…….. $ 26,754,998 $ 373,889 $ 27,128,887
Total Assets….. cono 37,090,805 373,889 37,464,694
Other current financial liabilities ? … 872,277 96,404 968,681
Other non-current financial liabilities ( 14,674,510 277,485 14,951,995
Total Liabilities ……. 25,746,936 373,889 26,120,825
Net Effect 11,343,869 – 11,343,869

(1) CODELCO has re-evaluated all of its contracts at the date of initial application, including those that under IAS 17 and IFRIC 4, had not
been identified as leases. As a result of the foregoing, leases have been included in accordance with the new requirements of IFRS 16.

The following table sets the reconciliation of operating leases under IAS 17 disclosed as of December 31,
2018 and lease liabilities recognized as of January 1, 2019.

January 1, 2019
Reconciliation of operating leases U.S.$
Operating lease commitments as of December 31, 2018, as disclosed in the consolidated financial statements in

accordance with IAS17…. $ 266,351
Less initial recognition exception:
Short-term leases ….. (55,360)
Leases with variable payments that do not depend on an index or a rate (69,070)
Low-value leases . (220)
Total lease liabilities (undiscounted) recognized as of January 1, 2019 141,701
Plus:
Leases identified in existing contracts as of January 1, 2019 under IFRS 16”, 421,608
Discounted using the incremental borrowing rate at the date of the initial application (January 1, 2019) ……… 3.81%
Discounted financing lease liabilities recognized as of January 1, 2019. 373,889
Lease liabilities related to leases previously classified as financial leases 107,839
Total lease liabilities recognized on January 1, 2019. 481,728
Consisting of:
Lease liabilities current portion. 117,914
Lease liabilities non-current portion 363,814
Total lease liabilities recognized on January 1, 2019. 481,728

60
(1) CODELCO has re-evaluated all of its contracts at the date of initial application, including those that under IAS 17 and IFRIC 4, had not
been identified as leases. As a result of the foregoing, leases have been included in accordance with the new requirements of IFRS 16.

See Section II, part 4 of the Consolidated Financial Statements for information regarding new accounting
standards that have been issued but are not yet effective.

Critical Accounting Estimates

The preparation of the consolidated financial statements in accordance with the IFRS requires the use of
certain critical accounting estimates and assumptions that affect the amounts of assets and liabilities recognized as of
the date of financial statements and the amounts of income and expenses during the reporting period. It also requires
CODELCO”s management to exercise its judgment in the process of applying CODELCO”s accounting principles.
The areas involving a higher degree of judgment or complexity, or areas where assumptions and estimates are
significant to the consolidated financial statements, are below. For a full description of CODELCO”s accounting
policies, see Section II to the Consolidated Financial Statements.

Useful Economic Lives and Residual Values of Property, Plant and Equipment. The useful lives and
residual values of property, plant and equipment assets that are used for calculating depreciation are determined
based on technical studies prepared by specialists (internal or external). When there are indicators that could lead to
changes in the estimated useful lives of such assets, these changes are determined by using technical estimates
considering specific factors related to the use of the assets.

Depreciation Method. Estimated useful lives, residual values and our depreciation method are reviewed at
the end of each year and again at the beginning of each year pursuant to changes in the structure of our reserves. We
record the effect of any change in estimates prospectively. Additionally, a review can happen at any time if the
conditions of ore reserves change significantly as a result of new information, confirmed and officially recognized
by us. The amounts recognized in property, plant and equipment are depreciated, as a general rule, under a units of
production method, allowing for the depreciation of an asset when it can be clearly identified as being a part of a
production process relating to copper extraction. For all other assets, however, a straight line depreciation method is
still being used.

Ore Reserves. The measurements of ore reserves are based on estimates of the ore resources that are
economically exploitable, and reflect the technical considerations of the Company regarding the amount of resources
that could be exploited and sold at prices exceeding the total cost associated with extraction and processing.

CODELCO applies its judgment in determining its ore reserves and, as such, possible changes in these
estimates could significantly impact the estimates of net revenues over time. For such reason, these changes would
lead to modifications in the usage estimates of certain assets and of the amount of certain decommissioning and
restoration costs.

CODELCO estimates its reserves and mineral resources based on the information prepared by the
Competent Persons of the Company, as defined and regulated by Chilean Law N* 20,235. The estimates are based
on the Joint Ore Reserves Committee (JORC) methodology, taking into consideration the historical information of
the cost of goods sold and copper prices in the international market.

CODELCO also periodically reviews such estimates supported by world-class external experts, who certify
the determined reserves.

Impairment of Assets. CODELCO reviews the carrying amount of its assets to determine whether there is
any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable
amount of the assets is estimated in order to determine the extent of the impairment loss with regard to the carrying
amount. In the evaluation of impairment, the assets are grouped into cash generating units (“CGUs”) to which the
assets belong. The recoverable amount of these assets or CGUs is calculated as the present value of the cash flows

61
expected to be derived from such assets, considering a pre-tax discount rate that reflects current market assessments
of the time value of money and risks specific to the asset. If the recoverable amount of the assets is less than their
carrying amount, an impairment loss exists.

CODELCO defines the CGUs and also estimates the timing and cash flows that such CGUs should
generate. Subsequent changes in the grouping of the CGU, or changes in the assumptions supporting the estimates of
cash flows or the discount rate, could impact the carrying amounts of the corresponding assets.

Estimates of factors influencing the calculation of cash flows, such as the price of copper or treatment
charges and refining charges, among others, are determined based on studies conducted by the Company, which are
in turn supported by certain standards over time. Any changes to these criteria may impact the recoverable amount
of the assets on which is performing the impairment tests. CODELCO”s evaluations and definition of the CGUs are
made at the level of each of its current operating divisions.

CODELCO has assessed and defined the CGUs that are constituted at the level of each of its current
operating divisions.

The review for impairment includes its subsidiaries, associates and joint arrangements.

Provisions for Decommissioning and Site Restoration Costs. CODELCO is obligated to incur
decommissioning and site restoration costs when an environmental disturbance is caused by the development or
ongoing production of a mining property. Costs are estimated on the basis of a formal closure plan and are
reassessed annually or as of the date such obligations become known.

Significant estimates and assumptions are made in determining the provision for decommissioning and site
restoration costs, as there are numerous factors that will affect the ultimate liability payable. In order to establish
such estimates, CODELCO: (1) creates a defined list of mine sites, installations and other equipment assigned to this
process, considered at the engineering level profile; (ii) evaluates the assets that will be subject to removal and
restoration, weighted by a structure of market prices of goods and services, and reflecting the best knowledge at the
time to carry out such activities; and (ili) examines the techniques and more efficient construction procedures to
date. In addition, CODELCO must make certain assumptions about the exchange rate for tradable goods and
services and the discount rate applied to update the relevant cash flows over time, which reflects the time value of
money and includes the risks associated with liabilities, which is based on the currency in which disbursements will
be made.

The provision as of a reporting date represents management’s best estimate of the present value of the
future decommissioning and site restoration costs required. Changes to estimated future costs are recognized in the
statement of financial position by adjusting the provision for decommissioning and site restoration costs as well as
the associated asset measured in accordance with IAS 16, “Property, Plant and Equipment.” Any reduction in the
decommissioning and site restoration liability, and therefore any deduction from the decommissioning and site
restoration asset, may not exceed the carrying amount of that asset. If it does, any excess over the carrying value is
immediately accounted for as profit or loss.

If the change in estimate results in an increase in the decommissioning and site restoration liability, and
therefore an addition to the carrying value of the asset, the entity is required to consider whether this is an indication
of impairment of the asset as a whole and test for impairment in accordance with IAS 36 “Impairment of Assets.” If
the revised asset net of decommissioning and site restoration provisions exceeds the recoverable value, that portion
of the increase is charged directly to profit or loss statement. Any decommissioning and site restoration costs that
arose as a result of the production phase of a mine should be expensed as incurred.

The costs arising from the installation of a plant or other site preparation projects are discounted at net
present value, provided for and capitalized at the beginning of each project, as soon as the obligation to incur such
costs arises. These decommissioning costs are charged to profit over the life of the mine through depreciation of the
asset. The depreciation is included in operating costs, while the unwinding of the discount in the provision is
included in finance costs.

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Accrual for Employee Benefits. Employee benefits costs for severance payments and health benefits for
services rendered by the employees are determined based on actuarial calculations using the projected credit unit
method and are charged to profit or loss on an accrual basis.

We use assumptions to determine the best estimate for these benefits. Such estimates, as well as
assumptions, are determined together with an external actuary. These assumptions include demographic
assumptions, mortality and morbidity, discount rate and expected salary increases and rotation levels, among other
factors. Although we believe that the assumptions used are appropriate, a change in these assumptions could affect
profit.

Provisional Pricing Arrangements. The substantial majority of copper produced by CODELCO is sold
under annual contracts. Pricing on such contracts is based on prevailing monthly average prices quoted on the LME
for a quotation period, generally the month following the scheduled month of shipment. CODELCO uses
information on future copper prices, through which it recognizes adjustments to its revenues and trade receivables
due to its provisional invoicing. These adjustments are updated on a monthly basis. At the end of each month,
CODELCO estimates and accounts for any change in the provisional sales price using information available at the
time financial statements are generated. However, the amount estimated may differ from the amount received at
settlement. Revenue is recorded at the time control of the asset is transferred to the customer according to the
shipment or dispatch of the products, in conformity with the agreed-upon conditions and are subject to variations
related to the content and/or sales price at their liquidation date. Notwithstanding the foregoing, there are certain
contracts under which control of the product is transferred to the client based on receipt of the product at the buyer”s
destination point, and for these contracts revenue is recorded at the moment of such transfer.

Sales contracts include a provisional price at the shipment date, which final price is generally based on the
price recorded in the LME. In the majority of cases, the recognition of sales revenue for copper and other
commodities is based on the estimates of the future spread of metal price on the LME and/or the spot price at the
date of shipment, with a subsequent adjustment made upon final determination and presented as part of “Revenue.”
The terms of sales contracts with third parties contain provisional pricing arrangements whereby the selling price for
metal in concentrate is based on prevailing spot prices on a specified future date after shipment to the customer (the
“quotation period”). As such the final price will be fixed on the dates indicated in the contracts. Adjustments to the
sales price occurs based on movements in the LME up to the date of final settlement. The period between
provisional invoicing and final settlement can be between one and nine months. Changes in fair value over the
quotation period and up until final settlement are estimated by reference to forward market prices for the applicable
metals.

Sales in the national market are recorded in conformity with the regulations that govern domestic sales as
indicated in Articles 7, 8 and 9 of Law N* 16,624, modified by Article 15 of Decree Law N* 1,349 of 1976, on the
determination of the sales price for the internal market.

Additionally, we recognize revenue for providing services, mainly related to the processing of minerals
bought from third parties. Revenue is recognized when the performance obligation has been satisfied.

See “Business and Properties—Marketing—Pricing and Hedging” for information regarding hedge
accounting.

Fair Value of Derivatives and Other Instruments. Management may use its judgment to choose an adequate
and proper valuation method for the instruments that are not quoted in an active market. In the case of derivative
financial instruments, assumptions are based on the observable market inputs, adjusted in conformity with the
specific features of the instruments.

Lawsuits and Contingencies. We assess the probability of lawsuits and contingency losses on an ongoing
basis according to estimates performed by our legal advisors. No provision is recognized for cases in which
management and our legal advisors believe that (i) a favorable outcome will be obtained, (ii) the probability of a loss
is remote or possible, but not probable, or, if probable, (iii) the amount of the obligation cannot be measured
reliably.

63
BUSINESS AND PROPERTIES

CODELCO is the world”s largest copper producer and one of the largest companies in Chile in terms of
revenues (U.S.$12.5 billion in 2019). As of December 31, 2019, CODELCOS*s total assets were U.S.$40.3 billion
and equity amounted to U.S.$11.6 billion. As of September 30, 2020, total assets were U.S.$42.4 billion and equity
amounted to U.S.$11.7 billion. CODELCO engages primarily in the exploration, development and extraction of ores
bearing copper and byproducts, the processing of ore into refined copper and the international sale of refined copper
and byproducts. CODELCO is 100% owned by the Government of Chile and controls approximately 6% of the
world’s proven and probable copper reserves, as such term is defined by the U.S. Geological Survey. In 2019,
CODELCO had an estimated 8.1% share of the total world copper production, with production amounting to
approximately 1.71 million metric tons (including CODELCO”s share of the El Abra deposit, which is mined by
Sociedad Contractual Minera El Abra, 49% of which is owned by CODELCO and 51% by Cyprus El Abra
Corporation (a subsidiary of Freeport-McMoRan Inc.), as well as CODELCO’s indirect 20% share of Anglo
American Sur) and an estimated 8% share of the world”s molybdenum production with production amounting to
approximately 22,353 metric tons, excluding CODELCO*s share of Anglo American Sur.

CODELCO”s main commercial product is Grade A cathode copper. In 2019 and for the nine-month period
ended September 30, 2020, CODELCO derived 91% of its total sales from copper and 9% of its total sales from
byproducts of its copper production.

The following table sets forth certain production, cost and price information relating to CODELCO for the
three-year period ended December 31, 2019 and the nine-month periods ended September 30, 2019 and 2020:

Copper Production, Cash Cost of Production and Price Information
(excluding El Abra and Anglo American Sur)
(production in thousands of metric tons and cash costs
and prices in cents per pound)

For the nine-month
periods ended

Year ended December 31, September 30,
2017 2018 2019 2019 2020
CODELCOSs Copper Production… 1,734 1,678 1,588 1,120 1,165
CODELCOSs Cash Cost of Productio! 135.9 139.1 141.6 143.1 126.9
Average LME Price!” 279.7 295.9 272.1 274.0 265.3

(1) Price for Grade A cathode copper.

CODELCO”s mission is to maximize the value of its mineral resources for the benefit of its shareholder,
the Chilean state, by fully developing its vast mining resources on a timely basis, leveraging the Company”s
experienced workforce, utilizing its advanced technological holds in key areas and by executing the following key
strategic initiatives:

Capital Expenditure Program. We seek to maintain and improve our competitive position in the industry
through our three-year capital expenditure program. Following the completion of a number of significant projects in
recent years, such as the development of CODELCO”s new Mina Ministro Hales, the development of sulfide ores at
the Radomiro Tomic mine, the expansion at the Andina mine and the development of the Pilar Norte area at the El
Teniente mine, CODELCO intends to continue its development program. Accordingly, the Company expects to
make capital expenditures of approximately U.S.$12.5 billion between 2020 and 2022 on major projects,
transforming its main mining operations with a view towards the long-term development of its resources. We expect
these expenditures to be funded with a combination of internal and external resources. For a complete list of planned
capital expenditures, see “Business and Properties—Copper Production—Operations.” CODELCO”s expansion and
development of major projects between 2020 and 2022 are expected to include:

e The gradual transformation of the Chuquicamata mine from an open pit mine to an underground
operation, which we expect will enable Chuquicamata to maintain its annual copper production at its

64
current level starting in 2019 (an approximate investment of U.S.$1.4 billion between 2020 and 2022).
Environmental approvals were obtained in September 2010, and the project is approximately 99.5%
complete as of September 30, 2020.

e The reallocation of the Andina plant, which involves maintaining the treatment capacity of the
concentrator plant in the long-term (an approximate investment of U.S.$172 million between 2020 and
2022). Operations are expected to begin in 2021, and the project is approximately 89.1% complete as of
September 30, 2020.

e The development of a new production level in the existing El Teniente underground mine (an
approximate investment of U.S.$2.0 billion between 2020 and 2022) to maintain El Teniente”s annual
copper production at its current level. Environmental approvals were obtained in March 2011. However,
based on geomechanical challenges that need to be addressed, an alternative development plan was
approved in January 2018 that will still permit us to maintain our original production goal and the new
mining level is now expected to be completed in 2023. As of September 30, 2020, the project is
approximately 62.6% complete.

+ The development of the Inca Pit project is designed to extend the life of the current underground mine
operation in the Salvador Division and enable it to maintain its annual production at its current level
starting in 2021 and the analysis for a future expansion, which requires an approximate investment of
U.S.$1.2 billion between 2020 and 2022. As of September 30, 2020, the feasibility study and initial
works have been completed.

+ The expansion of the existing Andina open pit is an initiative that is expected to expand the treatment
capacity of the concentrator plant up to 150 thousand tons per day (an approximate investment
of U.S.$80 million between 2020 and 2022) starting in 2027. As of September 30, 2020, the feasibility
study has been authorized and is approximately 78% complete.

Improvement in operations. A number of improvement initiatives are underway to adopt best industry
practices, most notably in the areas of labor productivity, asset utilization rates and process efficiency. Together with
its capital expenditure investment program, CODELCO expects these initiatives to enhance its competitive position.
CODELCO operates in a cyclical business and its strategy is to ensure that it is able to take full advantage of high
copper prices. CODELCO is developing a number of plans to achieve production targets in the coming years. These
plans mainly focus on reducing the risk of disruptions to production and providing increased flexibility to its
operations.

Transformation Plan. On November 29, 2019, CODELCO announced the Transformation Plan. Among
other objectives, the Transformation Plan seeks to optimize the standards for project selection and to reduce
execution delays, improve operating performance and renew focus on maximizing the value of its mineral resources
and reserves. The Transformation Plan also includes a series of targets to achieve cost savings in capital and
operational expenditures.

Exploration Efforts. CODELCO controls the largest copper reserves worldwide, the Company”s single
most important long-term competitive advantage. The discovery of new mining resources and improving its ability
to locate existing ore bodies and prospects are critical to CODELCO maintaining its preeminent position in the
industry. Accordingly, the Company”s exploration program will continue to be a key part of its business strategy.

Investment in Human Capital. The successful execution of CODELCO”s business strategy relies on
continuing to attract and retain a world-class management team and professionals of the highest caliber. The mining
industry faces increased competition for workforce talent. As a result, the Company intends to continue improving
career development opportunities for its staff and the overall attractiveness of CODELCO as a preferred employer.

Mining Association with Third Parties. CODELCO seeks to continue to develop and operate assets in

association with third parties where these associations will add value to CODELCO”s business. A few examples of
the Company”s willingness and ability to do so are (i) the association with Freeport-McMoRan Inc. in the El Abra

65
copper mine (CODELCO owns 49%) and (ii) the association with Anglo American, Mitsui and Mitsubishi
Corporation in Anglo American Sur (CODELCO owns an indirect 20% interest). CODELCO believes its large
mining reserve is a strong platform from which to establish such associations.

Copper Production
General

The copper deposits in CODELCO”s mines exist in two principal forms—sulfide ore and oxide ore. The
majority of CODELCO”s mines, including Chuquicamata and El Teniente, yield primarily sulfide ore. The ore
extracted from the Radomiro Tomic deposit is copper oxide and sulfides. CODELCO produces refined copper from
oxide and sulfide ore using different processes. CODELCO believes that having these two different forms of copper
deposits gives it a high level of flexibility to respond to market changes by adjusting its production and utilizing the
refining processes described below.

Sulfide Ores. Sulfide ores are found in CODELCO”s open-pit and underground mines. In open-pit mines,
the process of producing copper from sulfide ores begins at the mine pit. Waste rock and ores containing copper are
first drilled and blasted and then loaded onto diesel-electric trucks by electric shovels. Waste is hauled to dump
areas. In underground mines, copper ore is deposited on rail cars and transported to a crushing circuit where
gyratory crushers break the ore into sizes no larger than three-fourths of an inch. In both types of mines, the ore is
then transported to rod and ball mills which grind it to the consistency of powder. In the conventional
concentrator/smelter/refinery process for sulfide ore, this finely ground ore is agitated in a water and chemical
solution and pumped as a watery mixture to the flotation separator. The solution is then aerated, producing a froth
which carries the copper minerals, but not the waste rock, to the surface. The froth is skimmed off and filtered to
produce copper concentrates. The waste rock, called tailings, is sent to a tailings storage facility. The copper
concentrates (which contain a copper grade of approximately 30%) are then sent to the smelter.

At the smelter, the concentrates are blended with fluxes and fed into reverberatory furnaces or a Teniente
converter (a technologically advanced type of converter designed by CODELCO) where they are melted, producing
“matte” and “slag.” Matte from reverberatory furnaces contains approximately 45% copper, and matte from a
Teniente converter contains approximately 75% copper. Slag is a residue of the smelting process containing iron and
other impurities, which the Company disposes of with its other industrial solid waste. The matte is transferred by
ladles to the converters and is oxidized in two steps. First, the iron sulfides in the matte are oxidized with silica,
producing slag that is returned to the reverberatory furnaces. Second, the impurities in the matte sulfide are oxidized
to produce blister copper. The blister copper contains approximately 98.5% copper. Some of the blister copper is
sold to customers. The remainder is transferred to the electrolytic refinery.

After additional treatment in the anode furnace, the copper is cast into anodes and then moved to the
refinery”s electrolytic tank house. This anode copper is approximately 99.0% copper. In the electrolytic tank house,
anodes are suspended in tanks containing an acid solution and copper sulfate. An electrical current is passed through
the anodes and chemical solution to deposit clean copper on pure copper plates. The resulting refined copper
cathodes are 99.99% copper. Silver and small amounts of other metals contained in the anodes settle on the bottom
of the tanks and are recovered in a separate process.

Oxide Ores. Oxide ore is scarcer than sulfide ore, and is typically found closer to the surface of the earth. A
different process (called the SX-EW process) is used to produce refined copper from oxide ores, which CODELCO
employs at its SX-EW facilities in Chuquicamata, El Teniente, Salvador, Gabriela Mistral and Radomiro Tomic. In
the first step of the SX-EW process, copper oxide ore is mined, crushed and deposited into large piles. The piles are
leached for a period of several days with a solution of sulfuric acid, resulting in the effusion from the piles of a
solution with a high-concentration of copper. The copper solution is collected into large pools, from which copper is
then recovered by solvent extraction, followed by a second recovery method called electrowinning, to produce
high-grade copper cathodes. The SX-EW process involves lower overall refining costs, and can be used with a lower
grade of ore, than the traditional concentrator/smelter/refinery process. The SX-EW process also enables
CODELCO to recover copper by re-leaching waste material left over from prior copper extractions.

66
Operations

CODELCOSs copper operations are divided into the following eight divisions:

+ The El Teniente Division operates the El Teniente mine, which is the world”s largest underground copper mine
and has been in operation for more than 100 years. The El Teniente Division includes the Caletones smelter. In
2019, this division produced 459,744 metric tons of copper, or 26.9% of CODELCO”s total copper output
(including CODELCOS”s share of the El Abra deposit and Anglo American Sur), with a cash cost of 100.7 cents
per pound, compared to 106.5 cents per pound in 2018, and a total cash cost of U.S.$1.0 billion in 2019,
compared to U.S.$1.1 billion in 2018. During the first nine months of 2020, this division produced 312,961
metric tons of copper with a cash cost of 102.4 cents per pound and a total cash cost of U.S.$699 million.

+ The Radomiro Tomic Division operates the Radomiro Tomic mine, which began its first full year of production
in 1998 and ranked among the world”s top three largest producers of copper using SX-EW technology in 2018.
In 2019, this division produced 266,415 metric tons of copper cathodes, or 15.6% of CODELCO*s total copper
output (including CODELCO””s share of the El Abra deposit and Anglo American Sur), with a cash cost of
154.3 cents per pound, compared to 134.1 cents per pound in 2018, and a total cash cost of U.S.$901 million in
2019 compared to U.S.$973 million in 2018. During the first nine months of 2020, this division produced
182,068 metric tons of copper with a cash cost of 144.7 cents per pound and a total cash cost of U.S.$577
million.

+ The Chuquicamata Division operates the Chuquicamata mine, one of the largest copper-producing mines in the
world, which began its operations in 1915 and currently includes smelting and refining capacities. In 2019, this
division produced 385,309 metric tons of copper cathodes, or 22.6% of CODELCO’s total copper output
(including CODELCOS*s share of the El Abra deposit and Anglo American Sur), with a cash cost of 120.5 cents
per pound, compared to 131.5 cents per pound in 2018, and a total cash cost of U.S.$996 million in 2019,
compared to U.S.$908 million in 2018. During the first nine months of 2020, this division produced 299,752
metric tons of copper with a cash cost of 104.7 cents per pound and a total cash cost of U.S.$675 million.

+ The Mina Ministro Hales Division was created in 2010 for the operation of the Mina Ministro Hales ore body,
which first began producing copper at the end of 2013. In 2019, this division produced 151,838 metric tons of
copper, or 8.9% of CODELCOS”s total copper output (including CODELCO”s share of the El Abra deposit and
Anglo American Sur), with a cash cost of 123.6 cents per pound, compared to 124.0 cents per pound in 2018,
and a total cash cost of U.S.$400 million in 2019, compared to U.S.$517 million in 2018. During the first nine
months of 2020, this division produced 112,801 metric tons of copper with a cash cost of 116.5 cents per pound
and a total cash cost of U.S.$280 million.

e The Andina Division operates the Andina and Sur-Sur mines with production split among open-pit and
underground mines. It does not have independent smelting capacity. Andina has been in operation since 1970.
In 2019, this division produced 170,274 metric tons of copper, or 10.0% of CODELCO*s total copper output
(including CODELCOS”s share of the El Abra deposit and Anglo American Sur), with a cash cost of 184.6 cents
per pound, compared to 163.7 cents per pound in 2018, and a total cash cost of U.S.$669 million in 2019,
compared to U.S.$682 million in 2018. During the first nine months of 2020, this division produced 142,334
metric tons of copper with a cash cost of 145.9 cents per pound and a total cash cost of U.S.$442 million.

e The Gabriela Mistral Division was created in 2013 and operates the Gabriela Mistral mine, which uses SX-EW
technology. The Gabriela Mistral mine produced its first copper cathodes in 2008 after a 26-month construction
period. In 2019, this division produced 104,087 metric tons of copper, or 6.1% of CODELCO*s total copper
output (including CODELCO””s share of the El Abra deposit and Anglo American Sur), with a cash cost of
231.8 cents per pound, compared to 191.9 cents per pound in 2018, and a total cash cost of U.S.$532 million in
2019, compared to U.S.$454 million in 2018. During the first nine months of 2020, this division produced
74,226 metric tons of copper with a cash cost of 188.0 cents per pound and a total cash cost of U.S.$308
million.

+ The Salvador Division operates the Salvador mine and concentrator and the smelter/refinery complex at

67
Potrerillos, which has the capacity to treat 671,000 metric tons of concentrate. In 2019, this division produced
50,561 metric tons of copper cathodes, or 3.0% of CODELCO”s total copper output (including CODELCO”s
share of the El Abra deposit and Anglo American Sur), with a cash cost of 232.7 cents per pound, compared to
223.5 cents per pound in 2018, and a total cash cost of U.S.$257 million in 2019, compared to U.S.$296 million
in 2018. During the first nine months of 2020, this division produced 40,935 metric tons of copper with a cash
cost of 199.8 cents per pound and a total cash cost of U.S.$179 million. Unless the Inca Pit project (as described
below) enters the execution stage, CODELCO’”s Board of Directors has decided to phase out mining operations
at the Salvador mine by 2021, or sooner, if warranted by market and operational conditions, specifically
marketability of its copper, cash costs and annual reviews of performance. The Potrerillos smelter and refinery
would continue to operate upon any cessation of the mining operations at Salvador.

+ The Ventanas Division was created in connection with the acquisition of the Ventanas smelter/refinery complex
from Chile”s state-owned mining company ENAMI in 2005. In 2019, this division refined 376,400 metric tons
of copper, compared to 409,049 metric tons of copper in 2018. Pursuant to the terms of the acquisition,
CODELCO is required to provide on market terms the necessary smelting and refining capacity for the
treatment of copper concentrate delivered by the small- and medium-sized mining industry that ENAMI serves.

For a description of CODELCO”s associations with other companies, see “Business and Properties—
Copper Production—Associations, Joint Ventures and Partnerships” below.

Beginning in late 2010, CODELCO implemented a corporate reorganization plan which divided the
management of CODELCO’”s operations into Northern Operations (Operaciones Norte) and Central Southern
Operations (Operaciones Centro Sur), to supervise the divisions in the north and center-southern regions,
respectively. The reorganization was intended to simplify the organizational structure by causing all corporate
administrative and support functions to report to a single vice president, and the productive divisions to concentrate
on maximizing production, controlling costs and implementing safety measures. The Chuquicamata Division, the
Radomiro Tomic Division, the Mina Ministro Hales Division and the Salvador Division are now supervised by the
Vice President of Northern Operations (Operaciones Norte). The Andina Division, the El Teniente Division and the
Ventanas Division are now supervised by the Vice President of Central Southern Operations (Operaciones Centro
Sur).

CODELCOS”s copper production, including its share of the El Abra deposit and of Anglo American Sur,
decreased to 1,706,013 metric tons during the twelve months of 2019 from 1,806,363 metric tons in the twelve
months of 2018. This decrease was mainly due to lower copper production from the Radomiro Tomic, Andina and
Ministro Hales Divisions. Molybdenum production decreased by 7.0% in 2019 mainly due to the decreased
production from the Chuquicamata and the Andina Divisions.

The table below shows the production of copper from CODELCO”s mines, as compared to private sector
production in Chile, for the three-year period ended December 31, 2019 and the nine-month period ended September
30, 2020:

Production of Copper from Chilean Mines (CODELCO and Private Sector)
(in thousands of metric tons)

For the nine-month
periods ended September

Year ended December 31, 30, % Change

2017 2018 2019 2019 2020 2019/2020
El Teniente DivisiON ……ucannoncnonnieneneso 464 465 460 324 313 6.40%
Radomiro Tomic Division .. 319 333 266 198 182 (8.0)
Chuquicamata Division 331 321 385 262 300 14.3
Mina Ministro Hales … 215 195 152 111 113 2.1
Andina Division .. 220 196 170 126 142 12.9
Gabriela Mistral Division. 123 107 104 72 74 2.8
Salvador Division… . 62 61 51 27 41 51.3
EL ADA ccciccccccconnnonncinnnonnnnonnonnncnnninnacncns 38 44 40 29 26 (9.4)

68

Anglo American Sur? 70 84 78 61 52 (13.4)

CODELCO Total Production 1,842 1,806 1,706 1,209 1,243 2.9

Chilean Private Sector*. 3,661 4,026 4,081 3,037 3,018 (0.6)
5,503 5,832 5,787 4,246 4,262 0.4%

Total Chilean Production

(1) CODELCOSs figures presented for El Abra include 49% of the mine”s total production (the share of production which corresponds to
CODELCO”s 49% direct ownership interest in the mine). The balance of El Abra’s production is included in the private sector

figures.

(2) CODELCO*s figures presented for Anglo American Sur include 20% of the mine”s total production (the share of production which
corresponds to CODELCO”s 20% ownership interest in the mine). The balance of Anglo American Sur production is included in the

private sector figures.
(3) Source: Chilean Copper Commission.

The table below shows the breakdown of CODELCO”s own copper output for the three-year period ended
December 31, 2019 and the nine-month period ended September 30, 2020:

Copper Output of CODELCO (excluding El Abra and Anglo American Sur)
(in thousands of metric tons)

For the nine-month

period ended
Year ended December 31, September 30,
2017 2018 2019 2020
Cathodes…… 508 455 406 316
Blister and anode: 382 386 339 262
Calcines …. 159 153 117 95
Concentrates 686 684 726 492
1,734 1,678 1,588 1,165

The following table sets forth CODELCOSs initial capital expenditures budget for the period 2020-2022 by
division, and for the executive offices, as approved by the Companys Board of Directors as part of CODELCO”s
BDP report, which is subject to the approval of the Ministries of Finance and Mining (capital expenditures are
subject to change at the discretion of CODELCO). The capital expenditures budget is subject to an annual review

and therefore may be subject to change.

Division

Estimated
Investment”

Chuquicamata ………
El Teniente
Andina…
Radomiro Tomic.
Salvador ………..

Mina Ministro Hales
Gabriela Mistral
Ventanas…..
Executive Offices
Subsidiaries
Deferred expenses.

(in millions of U.S.S)

$

2,183
2,973
1,327
1,400
1,368
157
159
99
262

2,448
12,467

(1) Includes equipment replacement and facilities repair, contributions to subsidiaries and other.

The following table sets forth the estimated investment cost for each of CODELCO”s principal expansion
and development projects in each division (projects are subject to change at the discretion of the Company):

69
Estimated

Division Project Status Investment

(in millions of U.S.$)
El Teniente……. New mining level (2023) Execution” 5,183
Chuquicamata Chuquicamata Underground (2019) Execution” 5,036
Andina Expansion phase II (N.A.) Feasibility 3,017
ÓN Reallocation Plant (2020) Execution” 1,275
SalVadOY coccccnininnononincnnnninnns Inca Pit (2021) Feasibility 1,362
Total . s 15,874

(0) Expenditures have been invested in projects in the execution stage.

Nonetheless, the figures above reflect the estimated investments that CODELCO expected to make under
its 2020 updated BDP report. CODELCO continues to reformulate the Andina expansion project, which could
decrease the medium-term capital expenditure program. Therefore, this medium-term period more reliably reflects
CODELCO”s commitments than a longer-term period, especially considering current industry trends.

El Teniente Division

Mining Operations. The El Teniente Division is the largest division of CODELCO, based on 2018
production, and operates the El Teniente underground mine located 80 kilometers southeast of Santiago. With the
production of 459,744 metric tons in 2019, it is the world’s largest underground copper mine. For information
regarding the new mine level at the El Teniente mine, see “Summary—Competitive Strengths.”

The El Teniente deposit is also a porphyry-type ore body. The deposit covers a vertical span of over
1,500 meters. A tabular subvertical dacite porphyry intrusion two kilometers long by 200 meters wide is well
exposed in the northern part of the deposit, and a quartz-diorite stock is located at the southeast side. Wall rock are
mostly andesites, which are strongly mineralized, containing a high concentration of chalcopyrite and bornite. The
size of the deposit is at least three kilometers north-south and close to one kilometer wide.

El Teniente primarily produces concentrates that are smelted at the Caletones smelter. In addition to the
principal mine at El Teniente, the division performs mining operations at several other areas of the main deposit,
with a production of approximately 140,000 metric tons of ore per day. The Esmeralda area of the mine is the main
producing mine area, producing approximately 36,750 metric tons of ore per day.

As of September 30, 2020, the El Teniente Division employed 3,942 persons and produced 312,961 metric
tons of copper at a cash cost of 102.4 cents per pound and a total cash cost of U.S.$699 million, as compared to a
cash cost of 101.8 cents per pound and a total cash cost of U.S.$ 716 million during the first nine months of 2019. In
2019, the El Teniente Division produced 459,744 metric tons of copper at a cash cost of 100.7 cents per pound and a
total cash cost of U.S.$1.01 billion, as compared to a cash cost of 106.5 cents per pound and a total cash cost of
U.S.$1.08 billion in 2018. In 2017, this division had a cash cost of 113.5 cents per pound and a total cash cost
U.S.$1.2 billion.

Copper Production and Cash Cost—El Teniente Division
(production in thousands of metric tons and cash cost in cents per pound)

For the nine-month

period ended
Year ended December 31, September 30,
2017 2018 2019 2020
Copper Production 464 465 460 313
Cash Cost. 113.5 106.5 100.7 102.4

Smelting Operations. The El Teniente Division includes the Caletones smelter, which has the capacity to
smelt 1.25 million metric tons of concentrate per year. The El Teniente mine supplies 1.29 million metric tons of

70
concentrate per year to the Caletones smelter. The balance of concentrate processed by the smelter is brought by
railway from the Andina Division, 300 kilometers away.

The Caletones smelter operates two Teniente modified converters, three Pierce Smith Converters and
several refining furnaces and gas treatment plants. El Teniente has no electrolytic refining plant, and smelter output
is sold as fire-refined copper or anodes to be refined at other facilities such as the Ventanas refinery or
Chuquicamata.

Radomiro Tomic Division

The Radomiro Tomic deposit lies five kilometers north of the main pit at Chuquicamata. Radomiro Tomic
began production at the end of 1997. The Radomiro Tomic mine is a state of the art facility, and the world”s largest
producer of copper using the highly efficient SX-EW process.

During the first half of 2010, the Sulfide Phase 1 project was completed, which enables the treatment of
100,000 metric tons per day of sulfides from Radomiro Tomic in the Chuquicamata processing plants.

As of September 30, 2020, the Radomiro Tomic Division employed 1,270 persons and produced 182,068
metric tons of copper at a cash cost of 144.7 and a total cash cost of U.S.$577 million compared to a cash cost of
147.4 cents per pound and a total cash cost of U.S.$639 million during the first nine months of 2019. In 2019, this
Division produced 266,415 metric tons of copper at a cash cost of 154.3 and a total cash cost of U.S.$901 million
compared to a cash cost of 134.1 cents per pound and a total cash cost of U.S.$973 million in 2018. In 2017, this
division had a cash cost of 131.4 cents per pound and a total cash cost of U.S.$915 million.

Copper Production and Cash Cost—Radomiro Tomic Division
(production in thousands of metric tons and cash cost in cents per pound)

For the nine-month

period ended
Year ended December 31, September 30,
2017 2018 2019 2020
Copper Production Radomiro Tomic 319 333 266 182
Cash Cost Radomiro Tomic 131.4 134.1 154.3 144.7

Chuquicamata Division

Mining Operations. Located in the Atacama Desert, 1,200 kilometers north of Santiago and 240 kilometers
east of the Chilean city of Antofagasta, the Chuquicamata mine has been in continuous operation since 1915. The
Chuquicamata mine is an open-pit operation that produces predominantly sulfide concentrates, which are smelted
and refined on site. The pit size of the Chuquicamata mine is almost nine kilometers long in a north-south direction
by five kilometers wide and one kilometer deep.

The Chuquicamata deposit is a porphyry-type ore body. The most important feature of the ore body is a
north-south regional fault, the west fissure fault, which cuts the ore on the west side and creates a sharp limit on the
deposit. An oxide ore zone was a large part of the deposit and has been almost totally mined out. The mine contains
a supergene enrichment layer (a redeposit of copper, by natural forces, from higher to lower layers), which has a
thickness of almost 800 meters near the center of the mine. Five kilometers north of Chuquicamata, the ore body
narrows and merges with the Radomiro Tomic ore body. For information regarding the transformation of the
Chuquicamata mine from an open pit mine to an underground operation, see “Summary—Competitive Strengths.”

Smelting Operations. Chuquicamata utilizes one Outokumpu flash furnace, five Pierce Smith converters

and two Teniente converters to process 1.25 million metric tons of 29.6% copper concentrate per year.
Chuquicamata performs all stages of copper production from the mining process through cathode production.

71
As of September 30, 2020, the Chuquicamata Division employed 4,043 persons and produced 299,752
metric tons of copper at a cash cost of 104.7 cents per pound and a total cash cost of U.S.$675 million, compared to
a cash cost of 125.0 cents per pound and a total cash cost of U.S.$ 702 million during the first nine months of 2019.
In 2019, this Division produced 385,309 metric tons of copper at a cash cost of 120.5 cents per pound and a total
cash cost of U.S.$996 million, compared to a cash cost of 131.5 cents per pound and a total cash cost of U.S.$908
million in 2018. In 2017, this division had a cash cost of 130.9 cents per pound and a total cash cost of U.S.$933
million.

Copper Production and Cash Cost—Chuquicamata Division
(production in thousands of metric tons and cash cost in cents per pound)

For the nine-month
period ended

Year ended December 31, September 30,
2017 2018 2019 2020
Copper Production Chuquicamat: 331 321 385 300
Cash Cost Chuquicamata 130.9 131.5 120.5 104.7

Mina Ministro Hales Division

Mining Operations. The Mina Ministro Hales Division was created in September 2010 for the operation of
the Mina Ministro Hales ore body, and delivered its first tons of copper during the last quarter of 2013.

As of September 30, 2020, Mina Ministro Hales employed 747 persons and produced 112,801 metric tons
of fine copper at a cash cost of 116.5 cents per pound and a total cash cost of U.S.$280 million, compared to a cash
cost of 133.7 cents per pound and a total cash cost of U.S.$315 million during the first nine months of 2019. In
2019, this Division produced 151,838 metric tons of fine copper at a cash cost of 123.6 cents per pound and a total
cash cost of U.S.$400 million, compared to a cash cost of 124.0 cents per pound and a total cash cost of U.S.$516.9
million in 2018. In 2017, this division had a cash cost of 121.8 cents per pound and a total cash cost of U.S.$560
million.

Copper Production and Cash Cost—Mina Ministro Hales Division
(production in thousands of metric tons and cash cost in cents per pound)

For the nine-month

period ended
Year ended December 31, September 30,
2017 2018 2019 2020
Copper Production. 215 195 152 113
Cash COst……….. 121.8 124.0 123.6 116.5

Smelting and Refinery Operations. The processing of minerals will be carried out in a stand-alone
concentrator with processing capacity of 50,000 tons per day. Copper concentrates will be processed in a new
roasting plant. The project also includes a new acid plant.

Gabriela Mistral Division

The Gabriela Mistral ore body is located in Chiles Second Region and began production in May 2008. On
January 1, 2013, CODELCO created the Gabriela Mistral Division, which operates the Gabriela Mistral mine.
Gabriela Mistral uses SX-EW technology and produced its first copper cathodes in May 2008 after a 26-month
construction period at a cost of U.S.$1.0 billion.

As of September 30, 2020, the Gabriela Mistral Division employed 453 persons and produced 74,226

metric tons of copper at a cash cost of 188.0 cents per pound and a total cash cost of U.S.$308 million, as compared
to a cash cost of 250.2 cents per pound and a total cash cost of U.S.$ 398 million during the first nine months of

72
2019. In 2019, the Gabriela Mistral Division produced 104,087 metric tons of copper at a cash cost of 231.8 cents
per pound and a total cash cost of U.S.$532 million, as compared to a cash cost of 191.9 cents per pound and a total
cash cost of U.S.$454 million in 2018. In 2017, this division had a total cash cost of 151.9 cents per pound and a
total cash cost U.S.$411 million.

Copper Production and Cash Cost—Gabriela Mistral Division
(production in thousands of metric tons and cash cost in cents per pound)

For the nine-month
period ended

Year ended December 31, September 30,
2017 2018 2019 2020
Copper Productio: 123 107 104 74
Cash Cost…….. 151.9 191.9 231.8 188.0

Andina Division

Mining Operations. The Andina Division operates the Andina mine and the Sur-Sur mine, which are
located 50 kilometers northeast of Santiago. Production at the Andina Division is split among open-pit and
underground mines. For information regarding the Andina plant reallocation project, see “Summary—Competitive
Strengths.” The Andina Division does not operate a smelter. Its production is processed at the Caletones smelter of
El Teniente, at the Ventanas refinery or at the Salvador Division, and some of its concentrate is sold to ENAMI or
other purchasers.

As of September 30, 2020, the Andina Division employed 1,484 persons and produced 142,334 metric tons
of copper at a cash cost of 145.9 cents per pound and a total cash cost of U.S.$442 million, as compared to a cash
cost of 188.8 cents per pound and a total cash cost of U.S.$506 million during the first nine months of 2019. In
2019, the Andina Division produced 170,274 metric tons of copper at a cash cost of 184.6 cents per pound and a
total cash cost of U.S.$669 million, as compared to a cash cost of 163.7 cents per pound and a total cash cost of
U.S.$682 million during in 2018. In 2017, this division had a cash cost of 139.6 cents per pound and a total cash cost
of U.S.$654 million.

The Río Blanco-Los Bronces porphyry-type deposit, one of the largest copper ore bodies in Chile, is
partially owned by the Andina Division. The northwest portion of this deposit is owned by the Andina Division;
Anglo Sur owns and operates the mines at Los Bronces and El Soldado along with the Chagres smelter and various
mineral resources, including Los Sulfatos and San Enrique Monolito, located in the southwest portion of the deposit.
The deposit is characterized by plentiful tourmaline and breccia rock bodies mineralized with copper sulfides,
mostly calcopyrite. CODELCO”s portion of the deposit is four kilometers in length, in the northwest to southeast
direction, with a maximum width of almost one kilometer.

Copper Production and Cash Cost—Andina Division
(production in thousands of metric tons and cash cost in cents per pound)

For the nine-month

period
Year ended December 31, ended September 30,
2017 2018 2019 2020
Copper Production. 220 196 170 142
Cash COst……….. 139.6 163.7 184.6 145.9

With the aim to increase the processing output of the Andina Division, CODELCO completed the Andina
Phase 1 Expansion Project in 2010. While the Andina Division had plans to continue investing to expand the mine
and increase copper production by an additional 350,000 tons of copper per year, the Company is currently

73
reformulating its plans in order to create an alternative that should require less investment, while at the same time
seeking to minimize the environmental impact and prolong the life of the Andina Division.

Salvador Division

Mining Operations. The Salvador Division is the smallest of CODELCO*s divisions. The complex includes
the mine and concentrator at Salvador and a smelter/refinery at Potrerillos. The Salvador mine is located 900
kilometers north of Santiago and 120 kilometers east of the Chilean port of Chañaral. Concentrates are transported
67 kilometers from the mine to the smelter at Potrerillos via pipeline and truck.

The Salvador Division has the smallest base reserve of ore among all of CODELCO”s divisions. The
Salvador deposit is a typical medium-sized porphyry-type ore body. There is an 80- to 200-meter thick leached
capping covering a lensoid-shaped enrichment layer roughly one kilometer in diameter that attains a maximum
thickness of about 250 meters. This enrichment layer is almost completely mined out. Mining is currently focused
on the primary ore located underneath the secondary enrichment (the so-called Inca levels).

As of September 30, 2020, Salvador employed 1,446 persons and produced 40.935 metric tons of fine
copper at a cash cost of 199.8 cents per pound and a total cash cost of U.S.$179 million, compared to a cash cost of
246.6 cents per pound and a total cash cost of U.S.$146 million during the first nine months of 2019. In 2019,
Salvador produced 50,561 metric tons of fine copper at a cash cost of 232.7 cents per pound and a total cash cost of
U.S.$257 million, compared to a cash cost of 223.5 cents per pound and a total cash cost of U.S.$296 million in
2018. In 2017, this division had a cash cost of 198.7 cents per pound and a total cash cost of U.S.$269 million.

Unless the Inca Pit project (as described below) enters the execution stage, CODELCO’”s Board of
Directors has decided to phase out mining operations at the Salvador mine by 2021, or sooner, if warranted by
market and operational conditions, specifically marketability of its copper, cash costs and annual reviews of
performance. The Potrerillos smelter and refinery would continue to operate upon any cessation of the mining
operations at Salvador.

Copper Production and Cash Cost—Salvador Division
(production in thousands of metric tons and cash cost in cents per pound)

For the nine-month

period ended
Year ended December 31, September 30,
2017 2018 2019 2020
Copper Production… 62 61 51 41
Cash Cost ……….. 198.7 223.5 232.7 199.8

Smelting Operations. The smelting and refining operation is located at Potrerillos. This facility includes
one Teniente converter and four Pierce Smith converters for a rated annual capacity of 671,000 metric tons of
concentrate. CODELCO increased capacity of the Potrerillos smelter in 2004.

Ventanas Division

Smelting and Refinery Operations. The Ventanas Division was created in connection with the acquisition of
the Ventanas smelter and refinery from the Chilean state-owned mining company ENAMI in 2005. The Ventanas
smelter has the capacity to treat of over 400,000 metric tons of concentrate. Ventanas refined approximately 376,400
metric tons of copper in 2019. Pursuant to the terms of the acquisition, CODELCO is required to provide, on market
terms, the necessary smelting and refining capacity for the treatment of products for the small- and medium-sized
mining industry that ENAMI serves. As of September 30, 2020, the Ventanas Division employed 815 persons.

74
Associations, Joint Ventures and Partnerships

CODELCO has undertaken several projects, business ventures and associations with certain private sector

mining and non-mining enterprises, including:

SCM El Abra: In 1994, CODELCO (49%) formed a company, SCM El Abra, with Cyprus El Abra Corporation
(51%), a subsidiary of Freeport-McMoRan Inc., to develop the El Abra mine in northern Chile. The mine is a
porphyry copper open-pit facility located 105 kilometers north of the city of Calama at an altitude of 3,900
meters above sea level. Constructed at a cost of U.S.$1.1 billion, it is designed to produce 225,000 metric tons
of copper per year and includes one of the world”s largest SX-EW facilities. The El Abra project was originally
financed by a U.S.$850 million syndicated loan, which was repaid in full in 2004.

o In 2009, SCM El Abra approved resuming construction activities for the Sulfolix Project, which had
been deferred as a result of market conditions at the end of 2008, to extract and process (by the
leaching process) sulfide ores, which is expected to extend mine life by 13 years and enable El Abra to
produce at least 125,000 metric tons of fine copper per year. This project contains approximately 1.2
billion metric tons of leachable oxide and sulfide copper, with an average ore grade of 0.43%. The
project started producing sulfides, shifting from an oxide operation, during the first quarter of 2011 and
includes milling mine ores until 2024, and is expected to generate the last cathode in 2029 by leaching
heap remains. The Sulfolix Project requires approximately U.S.$565 million of initial equity and an
additional U.S.$160 million to sustain the operations. The project is financed by SCM El Abra’s
retained earnings.

o In 2019, SCM El Abra produced 81,520 metric tons of fine copper with a cash cost of 268 cents per
pound. For the nine-month period ended September 30, 2020, the production was 53,038 metric tons of
fine copper with a cash cost of 251 cents per pound.

o The project had delivered total dividends of U.S.$80 million, U.S.$10 million and U.S.$6 million in
2017, 2018 and 2019, respectively, and CODELCO had received U.S.$39.2 million, U.S.$4.9 million
and U.S.$3 million in dividends in 2017, 2018 and 2019, respectively. In the first nine months of 2020,
the project had not delivered dividends. As of September 30, 2020, the carrying value of SCM El
Abra”s ownership interest was equal to U.S.$585.4 million.

Anglo American Sur: On December 19, 2008, CODELCO purchased from ENAMI for U.S.$175 million an
option to purchase up to 49% of the equity interests of Anglo American Sur, a wholly-owned subsidiary of
Anglo American, for a price to be determined by a prescribed formula based on a multiple of historic earnings
(the “Sur Option”). Anglo American Sur owns and operates the mines at Los Bronces and El Soldado, the
Chagres Smelter and various mineral resources, including Los Sulfatos and San Enrique Monolito. In October
2011, CODELCO announced that it had arranged for a bridge loan of up to U.S.$6.75 billion from Mitsui that
would allow it to exercise the Sur Option and indicated its intent to exercise the Sur Option during the next
window for its exercise, which would occur in January 2012. On November 9, 2011, Anglo American
announced that it had sold 24.5% of the equity interests of Anglo American Sur to affiliates of Mitsubishi
Corporation. Following this sale, CODELCO announced that it retained the right to acquire up to 49% of the
equity interests of Anglo American Sur and requested from the Santiago Court of Appeals a legal order
preventing further sales of equity interests of Anglo American Sur until CODELCO was able to exercise the
Sur Option. The requested legal order was granted and, on January 2, 2012, CODELCO exercised the Sur
Option to purchase 49% of the equity interests of Anglo American Sur. Prior to and after the exercise of the Sur
Option, Anglo American and CODELCO were involved in additional legal proceedings relating to the exercise
of the Sur Option, which were ultimately settled pursuant to the settlement agreement described below.

o On August 23, 2012, CODELCO and Anglo American entered into a settlement agreement to settle
their respective claims in relation to the Sur Option. In connection with this settlement agreement,
CODELCO and Anglo American agreed that Becrux, then a wholly-owned subsidiary of Acrux, an
entity owned by CODELCO and Mitsui in the manner described below, would acquire 29.5% of the
equity interests in Anglo American Sur pursuant to the following transactions:

75
. On August 24, 2012, Becrux acquired (i) shares representing 24.5% of the equity interests of
Anglo American Sur for a purchase price of U.S.$1.7 billion, which was financed through a
draw down by an affiliate of CODELCO on the A8R Mitsui Bridge Loan Facility described
under “Management’s Discussion and Analysis of Financial Condition and Results of
Operations—Liquidity and Capital Resources—Other Debt;” and (ii) shares representing
0.94% of the equity interests of Anglo American Sur for a purchase price of U.S.$206.8
million, which was financed by cash contributions made by Mitsui; and

. On September 14, 2012, Becrux acquired shares representing 4.0% of the equity interests of
Anglo American Sur for a purchase price of U.S.$893.2 million, which was financed by cash
contributions made by Mitsui.

o As part of the settlement agreement, Anglo American Sur transferred to CODELCO certain
undeveloped mining properties, Los Leones and Profundo, which are located to the east of
CODELCO”s Andina mine, and the shareholders of Anglo American Sur entered into a shareholders”
agreement that provides a framework for the ongoing governance of Anglo American Sur, which
includes board representation and participation in certain decisions for Becrux.

o Immediately following the acquisition of 29.5% of the equity interests of Anglo American Sur,
affiliates of CODELCO and Mitsui owned approximately 83% and 17%, respectively, of the equity
interests of Acrux. In connection with the refinancing of the AG%R Mitsui Bridge Loan Facility
described above under “Management’s Discussion and Analysis of Financial Condition and Results of
Operations—Liquidity and Capital Resources—Other Debt,” an affiliate of Mitsui exercised its right to
acquire from an affiliate of CODELCO at the closing of the refinancing a number of equity interests of
Acrux representing a 4.5% stake in Anglo American Sur for a purchase price equal to U.S.$998
million. This amount was used to prepay a portion of the bridge loan previously drawn down by an
affiliate of CODELCO under the AR Mitsui Bridge Loan Facility in connection with the transactions
described above. Following the consummation of this transaction, affiliates of CODELCO and Mitsui
owned approximately 67.8% and 32.2%, respectively, of the equity interests of Acrux. Consequently,
CODELCO indirectly owns a 20% interest in Anglo American Sur.

o On November 26, 2016, CODELCO signed a credit agreement with Oriente Copper, an affiliate of
Mitsui, renegotiating the payment of principal at the end of the contract. The terms established an
annual interest rate of LIBOR +2.5% with a five-year maturity to be payable in one installment at
maturity with semi-annual interest payments. On May 26, 2017, CODELCO signed a new credit
agreement with Mitsui renegotiating the following semi-annual payment, which was on the same terms
as the first renegotiation done in November 2016.

o On December 21, 2017, CODELCO and Mitsui agreed to merge Acrux into Becrux, as the surviving
entity. The reorganization did not affect the interest that CODELCO and Mitsui indirectly hold in
Anglo American Sur.

o Anglo American Sur fine copper production was metric 389,194 tons in 2019 with a cash cost of 139
cents per pound, compared to 422,247 with a cash cost of 149 cents per pound and 348,732 metric tons
in 2017 with a cash cost of 173 cents per pound. For the nine-month period ended September 30, 2020,
the production was 261,248 metric tons of fine copper with a cash cost of 155 cents per pound. Anglo
American Sur distributed U.S.$187.3 million in 2017, U.S.$182.9 million in 2018, U.S.$84.4 million in
2019 and U.S.$22.7 million as of September 30, 2020 in cash dividends to Becrux, which is an
indirectly owned subsidiary of CODELCO. As of September 30, 2020, the carrying value of equity of
Anglo American Sur was equal to U.S.$2.8 billion. As of December 31, 2019, the carrying value of
equity of Anglo American Sur was equal to U.S.$2.9 billion, of which CODELCO has a 20% indirect
participation. See “Risk Factors.” A substantial amount of our total assets are property, plant and
equipment.

e SCM Purén: CODELCO (35%) and Compañía Mantos de Oro (65%), a subsidiary of Kinross Gold Corp., own

76
SCM Purén. SCM Purén’s mining activities, located in the Atacama Region, east of the city of Copiapó, began
in November 2005, having produced over 801,839 ounces of equivalent gold. In 2015, the company distributed
U.S.$2.5 million in dividends to CODELCO. During 2017, 2018, 2019 and the first nine months of 2020, this
company did not issue dividends. SCM Purén mines two gold and silver ore bodies through open pits.
Currently, SCM Púren is evaluating a second phase of the project, which is expected to produce 295,419 ounces
of gold equivalent over a four-year period.

Agua de la Falda S.A.: CODELCO (42%) and Minera Meridian Limitada (58%), a subsidiary of Yamana Gold
Inc., own Agua de la Falda S.A., which was created to explore and exploit the Agua de la Falda deposit that
was in production until 2005. This company has completed its feasibility study of the Jerónimo gold deposit,
which contains over 2 million ounces of gold. The results of this study have not been satisfactory and the
partners are studying alternatives for improvement.

Inca de Oro S.A.: CODELCO (33%) and PanAust Minera Limited (67%) own Inca de Oro S.A., which was
created in 2009 to explore, exploit and process mineral resources in Chile and abroad. The production of Inca
de Oro S.A. is currently halted pending new market opportunities.

Deutsche Giessdraht GmbH: CODELCO (40%) and Aurubis AG (60%) own Deutsche Giessdraht GmbH, a
German corporation located in Emmerich, Germany. The company, which has been in existence since 1975,
produces continuous copper cast wire rod. CODELCO indirectly supplies copper to Deutsche Giessdraht
GmbH. On July 31, 2018, CODELCO sold its 40% ownership stake in Deutsche Giessdraht GmbH to its
partner Aurubis AG after receiving approval of the transaction by Germany”s federal antitrust regulator
(Bundeskartellamt). The sale included an agreement which allowed CODELCO to produce wire rod until
December 31, 2018 to fulfill its sales contract obligations that expired at the end of 2018.

GNL Mejillones S.A.: Due to the decrease and eventual termination of natural gas supply from Argentina,
electrical power generation companies have experienced diminished electricity generation. For this reason,
CODELCO and Suez Energy Andino S.A. through GNL Mejillones constructed an LNG re-gasification plant,
which has been operating since the beginning of 2010. GNL Mejillones has the capacity to receive, process and
store natural gas, with a send-out capacity of 5.5 million of cubic meters of gas per day, originating in Trinidad
and Tobago and purchased from SUEZ Global LNG Ltd. under a long-term supply contract. The LNG storage
tank is currently in operation. GNL has entered into a long-term agreement with E-CL for the re-gasification
and storage of approximately 15 trillion BTU (British Thermal Unit).

o GNL Mejillones provides gas required by the electricity power plant in the Sistema Interconectado del
Norte Grande, known as the SING, which supplies power to CODELCO”s operations. The project
partners have financed this project under existing take-or-pay contracts with CODELCO and other
mining companies.

o As of June 30, 2019, CODELCO owned 37% of the outstanding shares of the company, and Suez
Energy Andino S.A. owned the remaining 63% of the shares.

o On August 6, 2019, CODELCO completed the sale of its 37% stake in GNL Mejillones S.A. to to
Ameris Capital AGF, for an amount of US$193.5 million.

Planta Recuperadora de Metales SpA: In December 2012, CODELCO (34%) together with LS Nikko (66%)
formed Planta Recuperadora de Metales SpA (“PRM”), the purpose of which is to process intermediate
products derived from refining and processing copper and other metals, in order to recover copper, other metals
and byproducts contained in these substances and transform them into commercial products, and also trading
and distributing all classes of goods or supplies relating to such process. This entity developed and built a
processing plant located in Mejillones, in the Antofagasta Region, which began its commissioning process
during 2016. A 20-year contract regulates the treatment of anodic slimes produced at Codelco refineries for the
recovery of precious metals.

Salar de Maricunga SpA: In April 2017, CODELCO formed Salar de Maricunga SpA (“Salar de Maricunga”)

7
to develop projects for the exploration and exploitation of lithium in Chile. In March 2018, Salar de Maricunga
entered into a special lithium operating contract with Chile”s Ministry of Mining for the exploration and
development of a lithium project in the Maricunga salt flat in the northern Atacama Region of Chile. In July
2019, CODELCO subscribed a non-binding MOU with Minera Salar Blanco S.A. with the purpose of studying
how to structure a sustainable lithium project from a social, environmental and economic point of view in the
Salar de Maricunga. As of the date of this offering memorandum, CODELCO is reviewing Minera Salar Blanco
S.A.’s lithium project according to the terms included in the MOU. In November 2020, CODELCO was
granted environmental authorization to explore lithium resources in some of its mining rights in Maricunga salt
flat. The exploration campaign will be developed during 2021. In addition, CODELCO is seeking alternatives
to consolidate the main mining properties of the Maricunga salt flat, based on a public-private alliance model,
according to the guidelines of the National Lithium Policy.

e Technology and Research and Development Partnerships and Associations: CODELCO has entered into
associations with companies and organizations that are world leaders in research and development to increase
the integration of knowledge and innovation into mining processes. The following is a representative list of
such associations:

o CodelcoTec SpA: CODELCO established CodelcoTec SpA (formerly, BioSigma S.A.) (“CodelcoTec”)
in 2002 with the Japanese company JX-Nippon Mining and Metals Corporation (“JX-Nippon Mining”)
and has since increased its participation to 99% following the exit of JX-Nippon Mining in 2016.
CodelcoTec”s mission today is the development of mining and metallurgy technological innovations,
commercial development of processes and technology in the field of genomics, proteomics, and
bioinformatics for the mining sector, and, in general, application of systems based on microorganisms,
analysis, research, invention and creation, development, and implementation of new applications,
processes, and uses for copper, molybdenum, lithium, and other byproducts of mining processes,
insofar as they are directly related to greater use of copper. CodelcoTec”s mission also includes
technological monitoring of copper substitutes, representation of domestic or foreign companies and
individuals or legal entities, sale and purchase, distribution, trading, import and export of such
substitutes and other activities relating to the foregoing.

o Kairos Mining S.A.: Kairos Mining S.A. is a company created in 2006 in association with Honeywell
Chile S.A., which owns 60% (CODELCO owns the remaining 40%). Kairos Mining S.A.”s purpose is
to provide services for the automation and control of industrial and mining activities, and to supply
related technology and software licenses;

o Ecosea Farming S.A.: CODELCO, through its subsidiary Innovaciones en Cobre S.A., was a 91.32%
shareholder in EcoSea Farming (“EcoSea”), a technology-driven company setting the standard for
aquaculture on a global scale. The company”s objective was to incorporate the use of metallic copper
alloy meshes for fish cultivation systems, in order to take advantage of the various benefits of copper:
antimicrobial, antifouling, anti-predator, mechanically strong and infinitely recyclable. In addition,
EcoSea discovered new properties that allow for lower operational costs and the expansion of offshore
aquaculture in exposed areas. During 2018, CODELCO sold the technology assets of EcoSea to a
group of investors and EcoSea was liquidated and dissolved.

The following table sets forth the major mining and exploration agreements to which CODELCO is a party
as of September 30, 2020:

Major Mining and Exploration Agreements
(As of September 30, 2020)

Partner Type
Mining Co-participation in Chile
SCM El Abra Freeport-McMoRan Inc. (USA) Copper
Agua de la Falda S.A. Meridian Gold Inc. (USA) Gold
SCM Purén Compañía Mantos de Oro (Chile) Gold/Silver
Inca de Oro S.A. PanAust Minera Limited (Australia) Copper
Anglo American Sur S.A. Inversiones Anglo American Sur S.A. (England); affiliates of Copper

78
Mitsubishi Corporation (Japan); and Mitsui £ Co., Ltd. (Japan)
Exploration Agreement Projects

Chile
Puntilla Galenosa Pucobre (Chile) Copper

International

Liberdade Pan Brazilian (Brazil) Copper/Gold
JV Codelco-Xstrata Xstrata Do Brasil (Brazil) Copper
Grupo Propiedades Ministerio de Minas y Petróleo del Ecuador (Ecuador) Copper

CODELCO reports its inventory of mining assets, distinguishing mineral resources and mineral reserves,
according to Chilean and international regulation. The system described below for categorizing mineral ore, which
is widely used within the mining industry, is codified in Chilean Law N* 20,235 and is regulated by an independent
Chilean private entity called the Comisión Calificadora de Competencias en Recursos y Reservas Mineras (the
Commission for the Qualification of Competencies in Mineral Resources and Reserves, or “CQCMRR”). The
CQCMRRK is part of the Committee for Mineral Reserves International Reporting Standards (CRIRSCO).

Geological Resources

Geological resources are concentrations or occurrences of materials in such form, quantity (tonnage and
ore grade) and quality, based on specific geological evidence and knowledge, which allow for the calculation of the
amount, ore grade and quality of the material with some level of confidence. Geological resources are identified and
evaluated through exploration, reconnaissance and sampling. They are estimated based on geological knowledge
about the deposit, which is based on scientific concepts concerning the formation of minerals such as oxides,
sulfides and mixed ores, as well as available knowledge concerning the geological continuity of the mineralized
sectors. This is based on technical parameters, such as robustness of the genetic-geological model, and its validation
through drillings. Geological resources are further categorized as measured, indicated and inferred.

A resource is considered to be measured if CODELCO”s knowledge of the resource is extensive and direct;
if CODELCO”s knowledge of the resource is substantial but less extensive, it is considered to be indicated; and if
CODELCO’s knowledge of the resource is only indirect, it is considered to be inferred.

Mineral Resources

Once CODELCO has achieved increased knowledge about its geological resources, it is able to generate a
long-term mining plan for the exploitation of such resources, which are then considered to be mineral resources.
Mineral resources, as well as geological resources, are sub-categorized as measured, indicated and inferred.

Ore Reserves

Ore reserves are defined as the economically mineable part of mineral resources. They include diluting
materials and allowances for losses, which may occur when the material is mined. Appropriate assessments and
studies have been carried out, which take into account rationally assumed mining, metallurgical, economic,
marketing, legal, environmental, social and governmental factors. These assessments address at the time of reporting
whether extraction is justified. Ore reserves are sub-divided in order of increasing confidence from probable ore
reserves to proved ore reserves. Ore reserves are a subset of mineral resources in the same way as mineral
resources are a subset of geological resources. The following diagram sets forth the relationships among the
different categories of resources and reserves:

79
Resources and Reserves, CODELCO

GEOLOGICAL
RESOURCES

EXPLORATION

Mining Plan

Life – of – mine

MINERAL
RESOURCES

The modifying factors:
Consideration of mining, metallurgical, economic,
marketing, legal, environmental, social and government factors

Chilean Code: CH20.235

RESERVES

Loco

Based on the methods and categories described above, CODELCO”s proved and probable reserves include
50.1 million metric fine tons of copper as of December 31, 2019, an amount that represents at least 29 years of
future production at current levels. In 2018 and 2017, CODELCO*s proved and probable reserves included 47.6 and
48.3 million metric fine tons of copper, respectively. As of December 31, 2019, CODELCO””s mineral resources
include 140.2 million metric fine tons of copper, and its identified geological resources include 394.2 million metric
tons of copper, for a cut-off grade of 0.2% copper.

The following table sets forth the amount and grade of CODELCO*s copper holdings by division according
to the methodology described above, as of December 31, 2019:

Radomiro Tomic .
Chuquicamata…
Ministro

Hales
Gabriela Mistral
Salvador
Andina…
El Teniente
Exploration/Business
and Subsidiaries’”.

Geological Resources?

Mineral Resources”

Ore Reserves

Grade Fine Grade Fine Grade Fine

Tonnage copper copperY Tonnage*” copper copper9) Orec) copper copper?
7,591 0.40% 30.5 4,282 0.44% 18.9 1,943 0.49% 9.4
14,633 0.43% 63.3 1,889 0.69% 13.1 1,289 0.73% 9.4
3.010 0.75% 22.6 1,328 0.87% 11.5 278 0.97% 27
1,438 0.33% 4.8 374 0.35% 1.3 285 0.35% 1.0
3,475 0.41% 14.1 813 0.60% 4.8 582 0.64% 3.8
22,063 0.61% 135.3 4,796 0.75% 36.1 1,213 0.76% 9.2
16,418 0.57% 93.9 4,633 0.79% 36.4 1,338 0.83% 11.2
8,368 0.35% 29.6 3,099 0.58% 18.1 770 0.45% 3.5
76,996 0.51% 394.2 21,213 0.66% 140.2 7,698 0.65% 50.1

(1) Geological resources cut-off grade 0.2% copper.

(2) Mineral resources with variable cut-off grade.

(3) In millions of metric tons.

(4) Includes artificial geological resources

80
The following table sets forth the copper holdings of the world and of CODELCO using the U.S.
Geological Survey system as of December 31, 2019:

World CODELCO CODELCO’s
(in millions of tons) (in millions of tons) share (%)
Geological Resources ….. 2,1000 394.20 19
Proved and Probable Reserves 8700 50.1 6

(1) As defined by the U.S. Geological Survey (January 2020) and with reference to “identified resources.”
(2) Refers to copper holdings that are measured, indicated and inferred.

Each year, the Board of Directors must approve a long-term BDP of the Company. The first three years are
subject to the approval of the Ministries of Finance and Mining. This plan must include the annual investment and
financing amounts in addition to the annual profits that the Company is estimated to generate during the period. The
Ministries of Finance and Mining jointly issue a decree, pursuant to which a portion of CODELCOS*s profit may be
allocated by CODELCO to the creation of capitalization and reserve funds.

The 2020 BDP enables CODELCO to develop a long-term mining plan. CODELCO reviews the terms of
the BDP annually to update or modify it for changes in business trends.

The 2020 BDP uses inferred resources to define CODELCO’”s strategic vision for long-term resource
development. However, the incorporation of such resources increases gradually over time, and the inferred resources
become proved and probable reserves.

In the early stages of the 2020 BDP, production is almost exclusively based on proved and probable
reserves and mining projects are at advanced stages of engineering or at the investment stage. Mining projects must
support their economic evaluation based on pre-defined minimum proved and probable reserves in order to be
approved for investment.

Resource Development

CODELCO controls approximately 6% of the world”s proved and probable copper reserves, as such terms
are defined by the U.S. Geological Survey.

Potential geological resources, which have been identified by our internal exploration division as the result
of projects carried out through 2020, comprise resources incorporated at different stages of exploration and have not
been added into CODELCO*s copper holdings.

CODELCOSs total potential geological resources, according to our internal estimates, are approximately
7,391 million of metric tons of ore with an 0.44% average copper ore grade, and equivalent to 32.30 million metric
tons of fine copper. As explorations progress and further estimates are completed, these resources could be
incorporated into CODELCO*s copper holdings.

The following table shows the distribution of CODELCO”s potential geological resources in all districts of
CODELCO Norte and projects abroad, as of December 31, 2019:

Potential Geological Reserves”?

Fine
Region Ore”? Grade Copper Copper”

CODELCO Northern District (CND)
Don Felipe
San Andrés NW
Carmen
Zeus
San Antonio (Greenfield)
Exploradora Campamento (Greenfield)

0.44 13.38

International Exploration 0.44 18.92

Liberdade (Brazil)

81
Llurimagua (Ecuador)

0.44 32.30

(1) Geological resources cut-off grade 0.2% copper.
(2) In millions of metric tons.

Production Costs of Copper

CODELCOSs production costs include all costs and expenses incurred in connection with the mining and
production of its copper mix and related byproducts. These production costs do not include administrative and
operating costs incurred in connection with the processing of other copper products purchased from third parties.

In 2018, CODELCO”s annual production of copper was 1.68 million metric tons, or 1.81 million metric
tons including the El Abra and Anglo American Sur interests. CODELCO continues to focus on controlling and
limiting increases in production costs. In 2018, CODELCO*Ss total costs and expenses were 245.1 cents per pound,
compared to 227.1 cents per pound in 2017, mainly due to the appreciation of the Chilean peso against the U.S.
dollar, lower production levels, higher input prices, reflected in higher fuel, energy and materials expenses, a non-
cash charge related to a write-off of an underground mining innovation project, an impairment recognition in
Ventanas Division and higher bonuses and employment benefits associated with 18 collective bargaining
agreements. In 2019, CODELCO*s annual production of copper was 1.59 million metric tons, or 1.71 million metric
tons including the El Abra and Anglo American Sur interests. In 2019, CODELCO”s total costs and expenses
decreased by 11.6 cents per pound (4.7%) to 233.5 cents per pound, compared to 245.1 cents per pound in 2018,
mainly due to Chilean peso depreciation against U.S. Dollar and cost cutting initiatives, partially offset by lower
production levels in connection with weather disruptions in the northern area of Chile, a 14-day strike at the
Chuquicamata mine and upgrades at the Chuquicamata and Salvador smelters that suspended operations
temporarily. During the first nine months of 2020, CODELCO*s total costs and expenses decreased by 11.3 cents
per pound (4.7%) to 228.3 cents per pound, compared to 239.7 cents per pound for the same period in 2019, mainly
due to lower input prices, such as electricity and diesel, depreciation of the Chilean peso against the U.S. Dollar and
higher production volume.

In 2013, CODELCO also implemented a productivity and cost structured project intended to lower costs
and increase production. The initiative is comprised of: (i) performance optimization to minimize operational
disruption; (ii) budget optimization to identify expendable and necessary contracts to control the budget for
third-party services costs; (iii) energy and input costs optimization marked by a review of energy and main inputs
contracts; and (iv) a review of hygienic factors and costs, such as travel expenses and consulting services. Moreover,
CODELCO has also created a new Vice President for Productivity and Costs position with the aim of increasing
productivity, reducing costs and enhancing the cost control program.

In 2019, CODELCO*s cash cost was 141.6 cents per pound, compared to 139.1 cents per pound in 2018,
due to lower production levels as a result of weather disruptions in the northern area of Chile, a 14-day strike at the
Chuquicamata mine and lower by-product credits due to lower volumes sold of molybdenum, sulfuric acid, gold and
silver. For the first nine months of 2020, CODELCO”s cash cost of production was 126.9 cents per pound, compared
to 143.1 cents per pound for the same period in 2019, mainly due to lower input prices, such as electricity and diesel,
depreciation of the Chilean peso against the U.S. Dollar and higher production volume.

In 2019, CODELCOS*s total cash cost was U.S.$4.9 billion, as compared to U.S.$5.1 billion in 2018. For
the first nine months of 2020, CODELCOS*s total cash cost was U.S.$3.2 billion, as compared to U.S.$3.5 billion for
the same period in 2019. Because a significant portion of CODELCO”s costs are denominated in Chilean pesos, the
depreciation of the Chilean peso against the U.S. dollar reduces CODELCO*s cash costs in U.S. dollar terms and, on
the other hand, the appreciation increases these costs. See “Exchange Rates.”

The main energy sources for CODELCO”s operations are electricity, liquid fuels (such as diesel, fuel oil
and gasoline) and natural gas. Since 2004, there has been a restricted supply of natural gas from Argentina.
CODELCOSs production costs have increased due to these shortages, having to rely on electricity generated from
more expensive sources, such as diesel, oil or coal, and these increased costs have adversely affected CODELCO”s
results of operations.

82
In late 2009 and early 2010, as a palliative measure given the adverse effects of Argentina”s restriction and
in order to stabilize future energy costs, CODELCO entered into electrical supply agreements at competitive prices
for a 15-year period for its facilities in the Chuquicamata Division and for a 30-year period for facilities in the
middle-south region of Chile. Both agreements include the creation of new electrical generation capacity based on
coal. Furthermore, in 2018 CODELCO entered into an extension of the Chuquicamata Division contract for an
additional 11 years. This new agreement, effective as of 2025, provides for the creation of new electrical generation
capacity based on renewable sources. Additionally, in early 2010, CODELCO entered into a five-year supply
contract for liquid fuels with the main Chilean fuel distributors. In 2015, after the expiration of this contract,
CODELCO entered into a new five-year supply contract for liquid fuels. In August 2011, CODELCO entered into
two energy and power supply agreements with Norgener S.A. for the Mina Ministro Hales Division and the
Radomiro Tomic Division. CODELCO began to receive energy under these contracts in 2011 for Mina Ministro
Hales and began in 2017 for Radomiro Tomic, in each case lasting until 2028. During 2014, AES Gener S.A. took
over Norgener S.A., assigning CODELCO’”s contract to AES Gener S.A. These energy supply contracts are
expected to meet all of CODELCO’”s power requirements. In April 2012, CODELCO renewed a contract with
Pacific Hydro, involving the purchase of power generation of the Coya and Pangal hydroelectric plants, for 12 years.
Since CODELCO*s sale of the Coya and Pangal hydroelectric plants to Pacific Hydro in 2004, Pacific Hydro and
CODELCO have entered into similar supply contracts to purchase the injected energy produced by these
hydroelectric plants.

CODELCO continues to develop and refine its mine management practices and programs to limit and
reduce its costs. These initiatives include the following: (i) improved deposit identification and mining techniques;
(ii) the implementation of early retirement plans and workforce reduction programs; (iii) an investment in human
capital and continuing to attract and retain a world-class management team and professionals of the highest caliber;
(iv) improved utilization of equipment and inputs used in the processes of copper production to increase productivity
and efficiency; and (v) the development of key projects, specifically the new mine level at El Teniente, the Andina
plant reallocation and the Chuquicamata underground projects.

Marketing
General

Four of CODELCO*s wholly-owned subsidiaries and 12 of its sales representatives cover over 35 countries
around the world. The following table shows the breakdown of CODELCO’s sales by product type including

third-party products for the three years ended December 31, 2019 and the nine-month period ended September 30,
2020:

Copper Sales by Product Type
(in thousands of metric tons)

For the nine-month

period ended
Year ended December 31, September 30,
2017 2018 2019 2020
Cathodes …………. 1,233 1,231 1,076 899
Blisters and Anodes. 119 136 58 58
Concentrates … 611 529 721 421
1,963 1,896 1,856 1,378

CODELCOS*s marketing strategy is focused in three major areas:

e Establishing long-term relationships. CODELCO encourages sales through annual contracts and direct
long-term relationships with copper consumers.

e Quality and sales service. CODELCO focuses on product quality and sales service based on timeliness,
scheduling and conditions of product delivery.

83
e Diversification. CODELCO has a geographically diverse sales portfolio.
Pricing and Hedging

The substantial majority of copper produced by CODELCO is sold under long-term contracts of at least
one year to customers that have long-term relationships with CODELCO. The specific commercial terms of these
contracts are negotiated annually by the parties for the following calendar year. Recently, and as part of a revamped
commercial strategy, CODELCO has agreed to sell copper under a rolling deal format known as “evergreen”
contracts with certain key customers. CODELCO”s evergreen contracts have an initial duration of three years from
the effective date and, unless terminated by either party, are automatically renewed for an additional year at the end
of the original term. The main advantage of evergreen contracts is to lock-in sales to key customers (and for
customers to have a guaranteed supply of raw material from a key supplier) over a longer period of time. For both
annual and evergreen contracts, the premium over the base price is negotiated annually and the base price is the
LME cash settlement averaged over the quotation period, which according to CODELCO”s commercial policy is the
month following the contractual or scheduled month of shipment (referred to as M+1). Products that are not
committed under long-term contracts (which represent a small percentage of CODELCO””s annual volume) are sold
throughout the year at the prevailing conditions of the spot market to either consumers or merchants.

CODELCO applies a premium policy in sales of its Grade A cathodes. Premium amounts for different
markets are adjusted in accordance with prevailing ocean freight costs and keyed to the standard terms of payment
in different markets, as well as to the individual characteristics and competitive conditions of those markets. For
2019, the base premium for CIF shipments (including shipping and insurance costs) to Rotterdam was set at U.S.$98
per metric ton, compared to U.S.$87 per metric ton in 2018 and U.S.$82 per metric ton in 2017. The estimated base
premium for 2019 is U.S.$98 per metric ton.

CODELCO sells its copper concentrates under long-term contracts. These contracts generally have
three-year terms with fixed volume. As a general rule, contracts covering one-third of the terms on one-third of the
volume are negotiated on a yearly basis. The sale price is based on world metal prices and is generally tied to the
LME settlement prices for Grade A copper cathodes minus certain treatment and refining charges.

Molybdenum is sold mainly to steel producers and merchants under annual sale contracts. Sales prices are
based on prevailing monthly averages of molybdenum dealer oxide high/low prices as quoted in “Metals Week” for
a quotation period, generally the month following the scheduled month of shipment.

CODELCO has hedged certain future copper delivery commitments and production in order to manage the
risks associated with copper price volatility in the past. CODELCO currently does not have any hedged production
commitments and therefore there is no relevant impact from hedging. See notes 29 and 30 to the Unaudited Interim
Consolidated Financial Statements.

CODELCO also periodically enters into futures contracts with respect to sales of its own copper in order to
provide protection to its customers against fluctuation in the sale price paid by them in connection with such sales.

See “Risk Factors—Risks Relating to CODELCO”s Operations—CODELCO engages in hedging activity
from time to time, particularly with respect to its copper production, which may not be successful and may result in
losses to CODELCO,” notes 27 and 28 to the Consolidated Financial Statements and notes 29 and 30 to the
Unaudited Interim Consolidated Financial Statements for further details regarding CODELCO”s hedging activity.

Major Export Customers

As discussed above, most of CODELCO”s customers receive shipments on a monthly basis. Consequently,
CODELCOSs sales volume is relatively consistent throughout the year. CODELCO*”s sales of copper in 2019 were
geographically diversified, with approximately 49% of sales made to Asia, including 35% to China, 13% of sales
made to Europe and 37% to North and South America. CODELCO”s top ten customers purchased approximately
41.5% of its total copper sales volume in 2019.

84
The following table shows CODELCO’”s copper sales for the three years ended December 31, 2019 to
CODELCOSs top export markets and in Chile:

CODELCOS*s Copper Sales by Destination
(in thousands of metric tons)

2017 2018 2019

789 869 656
United States 295 248 273
South Korea 123 107 113
Chile 170 201 251
Franc 95 82 79
Brazil 88 72 73
Germany… 58 17 1
India 58 30 30
Japan 37 43 42
Taiwan. 54 48 74
Spain 51 31 48
Bulgari: 28 22 3
Turkey 29 25 22
Greece 11 5 5
Mexico 10 14 31
Malaysia… 7 5 6
Thailand … 7 7 8
Vietnam. 12 8 6
Canada. 6 32 –
Others” 63 33 135
Total 1,991 1,899 1,889

(Mm In 2019, CODELCO sold 65 thousand metric tons to Peru and 34 thousand metric tons to Netherlands.

The sales to China decreased in 2019 as compared to 2018 and 2017 primarily driven by stronger demand
in the U.S. and other markets.

Competition

CODELCO believes that competition in the copper market is based upon price, quality of product and
timing of delivery. CODELCO’”s products compete with other materials, including aluminum and plastics.
CODELCO competes with other mining companies and private individuals in connection with the acquisition of
mining concessions and mineral leases and in connection with the recruitment and retention of qualified employees.

Employees

On December 31, 2019, CODELCO employed 16,731 employees as compared to 18,203 employees as of
December 31, 2018. CODELCO spent U.S.$11.5 million during 2019 on staff development and training. A total of
578,555 hours of training were held, with 16,053 employees attending multiple courses. CODELCO employed an
average work force of 17,395 persons during the twelve months of 2019.

As of December 31, 2019, approximately 90% of CODELCO”s employees were covered by collective
bargaining agreements with labor unions. Most of these collective bargaining agreements have terms of two to
three years.

In the nine-month period ended September 30, 2020, CODELCO negotiated two collective bargaining
agreements with no conflicts or work stoppages.

In 2019, CODELCO negotiated eight collective bargaining agreements with no conflicts or work
stoppages, except for one 14-day strike involving approximately 3,200 union workers in the Chuquicamata Division.
In 2018, CODELCO negotiated 18 collective bargaining agreements. Twelve collective bargaining agreements,
covering a total of 7,081 employees at the Andina Division, Salvador Division, Mina Ministro Hales Division, El
Teniente Division and Gabriela Mistral Division, were negotiated ahead of schedule without any conflicts or work

85
stoppages. Five collective bargaining agreements, covering a total of 2,601 employees at the Radomiro Tomic
Division, Mina Ministro Hales Division, Chuquicamata Division and our headquarters, were negotiated on schedule
without any conflicts or work stoppages. The remaining collective bargaining agreement was reached at the
conclusion of the 39-day strike with the workers from the Andina Division.

CODELCO has experienced material work slowdowns, work stoppages and strikes in the past.

In July 2015, the Copper Workers Confederation (the “CTC”) organized an illegal 22-day strike that
primarily affected the Salvador Division and, to a lesser extent, the Mina Ministro Hales Division. In August 2015,
the CTC, AGEMA and CODELCO, in its role as facilitator, agreed to a protocol for the commencement of a
dialogue. Since then, there have been additional conversations, none of which have resulted in a review or extension
of the existing agreement, as intended by CTC. There can be no assurance that further work slowdowns or stoppages
with the CTC will not occur in the future.

As of September 30, 2020, there were 19,811 employees of regular independent operating contractors and
14,735 employees of contractors involved in the development of CODELCO*s investment projects.

Work slowdowns, stoppages and other labor-related events could increase CODELCO”s independent
contracting costs, which could have a material adverse effect on the business, financial condition, results of
operations or prospects of CODELCO. See “Risk Factors—Risks Relating to CODELCO”s Operations—Labor
disruptions involving CODELCO”s employees or the employees of its independent contractors could affect
CODELCOSs production levels and costs.” In addition, pursuant to the Labor Code of Chile, CODELCO could be
held liable for the payment of labor and social security obligations owed to the employees of independent
contractors (or their subcontractors) if the independent contractors (or their subcontractors) do not fulfill those
payment obligations. CODELCO has agreed with a Government of Chile agency to provide a framework to
facilitate this agency”s supervision of the labor and social security obligations owed by the independent contractors
to their employees.

As part of its compensation plan, CODELCO offers each employee the opportunity to partially finance the
purchase of a first home or to obtain other personal loans granted through each employee”s severance plan. Such
home loans have a term of up to 15 years, and such personal loans have a term of less than one year. Loans of both
kinds provide for interest rates of actual inflation plus a margin of between 1% and 5%. As of September 30, 2020,
an aggregate principal amount of U.S.$124 million of these loans was outstanding.

Number of Employees by Division”?

January to December Variation (%) January to September

Divisions 2017 2018 2019 2018/2019 2020
Chuquicamata. 5,679 5,601 5,155 (8.0)% 4,351
Radomiro Tomi 1,238 1,258 1,220 6.0% 1,16
Gabriela Mistral.. 548 550 501 (8.9% 457
Mina Ministro Hales. 758 780 17 (0.41% 768
1,666 1,661 1,517 (8.7% 1,436
1,691 1,719 1,623 (5.60)% 1,511
4,526 4,378 4,154 (5.)% 3,956
Headquarters 477 606 578 (4.61% 576
Ventanas .. 936 895 845 (5.6)% 842
855 944 982 (4.0% 863
29 34 42 23.5% 44
18,403 18,426 17,395 (5.61% 16,020

(09) Average number of employees for the periods presented.

Chile Law N* 20,123 of 2007 (the “Chile Subcontracting Law”) governing subcontractors provides
incentives for companies to ensure that contractors and subcontractors comply with labor, health and safety
regulations and standards with respect to their own employees. The Chile Subcontracting Law gives companies the
right to request that contractors provide information on the status of their payment of labor and social security
obligations to their employees prior to the company”s payment of amounts due to contractors. Additionally,

86
companies have the right to withhold payments due if the contractors cannot provide evidence that they have
fulfilled their labor and social security obligations. Finally, companies are required to pay contractors” pending labor
and social security obligations with the amounts withheld from the contractors. It also regulates the provision of
temporary services by contractors and subcontractors, enabling the creation of specialized and regulated companies
for this specific purpose (Empresas de Servicios Transitorios) and defining the specific events under which
companies may hire for temporary services.

Occupational Health and Safety

CODELCO, through its structural project on occupational safety and health, has established occupational
health and safety performance indicators aimed at avoiding serious and fatal accidents and occupational illnesses. In
2018, there were four fatalities involving CODELCO personnel and CODELCO contractors. In 2019, there was one
fatality involving CODELCO personnel. CODELCO is currently investigating the cause of this fatality.

The total number of “lost time” accidents in 2019 was 108 and the accident frequency rate was 0.70
accidents per million hours worked. As of September 30, 2020, the current total number of “lost time” accidents for
2020 is 73 and the accident frequency is 0.86 accidents per million hours worked. In 2019, the current total number
of “lost time” accidents was 108 and the accident frequency was 0.70 accidents per million hours worked.

Comptroller General of the Republic

During 2017, the Comptroller issued three declarations (Opinions N* 15.759 and N” 18.850, both from
2017, and Final Auditor Report (Informe Final de Auditoria) N* 900/2016, from a 2016 audit) that affect
CODELCO. Two of these declarations are opinions related to labor relations that: (i) query whether CODELCO
could provide greater benefits to its employees than those currently established by law and (ii) state that, although
CODELCO may continue to engage in collective bargaining with its employees, the Comptroller reserves the right
to evaluate the amounts agreed upon. The third declarations was the result of an audit report, which maintained that
CODELCO was subject to the provisions of the Public Procurement Law (Law N* 19,886) that relates to: (1) the
prohibition on contracts between related parties and (1i) the mandatory public tender of contracts through the rules
that apply to public services. CODELCO has filed administrative appeals against all three declarations issued, and
subsequently filed an action of annulment against the three declarations issued by the Comptroller. The action of
annulment was denied and in October 2020 CODELCO appealed the decision. A final ruling is still pending.

Although CODELCO does not question the competence of the Comptroller, CODELCO disputes the
standard on which the Comptroller is basing its conclusions. As of the date of this offering memorandum,
CODELCO has estimated a negative effect of approximately U.S.$100 million due to a reduction in production
related to the delay in awarding specific contracts and the delay of investments. A final decision regarding this
matter is pending.

Legal Proceedings

CODELCO is party to various legal proceedings in the ordinary course of business. Other than as disclosed
in this offering memorandum, CODELCO is not currently involved in any litigation or arbitration proceeding,
including any proceeding that is pending or threatened of which we are aware, which we believe will have, or has
had, a material adverse effect on the Company. Other legal proceedings that are pending against or involve us and
our subsidiaries are incidental to the conduct of our and their business. We believe that the ultimate resolution of
such other proceedings individually or on an aggregate basis will not have a material adverse effect on our
consolidated financial condition or results.

87
Labor-Related Proceedings

We are a party to various legal actions involving labor claims of unions and former and present employees.
These labor disputes relate to working conditions, union practices, improper termination and discrimination. We do
not expect these disputes to have a material adverse effect on our financial condition or future results of operations.

Other Proceedings

In October 2020, CODELCO, on the one hand, and Santa Elvira S.A., Mining Services Group S.A. and
Sociedad de Servicios para la Minería Limitada (collectively “Santa Elvira”) on the other, simultaneously filed
reciprocal arbitration claims under an agreement with CODELCO”s El Salvador Division, for disputes related to
charges and payments between 2012 and 2018. CODELCOS”s claims amount to approximately U.S.$315 million and
Santa Elvira is claiming payment for works allegedly executed for approximately U.S.$75 million. The proceedings
are in the early stages and a final ruling is pending.

In July 2020, the State Defense Council filed a claim against CODELCO seeking environmental
rehabilitation measures for alleged environmental damage to water sources and vegetation surrounding the “Salar de
Pedernales” due to surface and underground water use between 1994 and 2017 by CODELCO”s El Salvador
Division. The proceedings are currently in the discussion period. On November 16, 2020, CODELCO filed its
response, and subsequently the parties to this proceeding agreed to and filed a settlement agreement, which is
pending approval by the Environmental Court.

In October 2019, CODELCO and Colbún S.A. simultaneously filed for the initiation of arbitration
proceedings in respect of a dispute under a power purchase agreement between them. The purpose of this arbitration
is to seek a determination on which party is ultimately responsible for bearing the cost of the emissions taxes set
forth under Law 20,780, which allegedly affect the thermoelectric plant associated with the power purchase
agreement. The relevant taxes amount to approximately U.S.$14 million to U.S.$15 million per year for the duration
of the power purchase agreement, which expires in 2044, unless terminated earlier. The proceedings are in the early
stages and a final ruling is pending.

In July 2019, Ingeniería y Maquinarias Indak Limitada et al. filed a civil a claim against CODELCO
claiming payment of damages, loss of profits, loss of opportunities and moral damages, plus interest thereon, in the
amount of approximately U.S.$46 million. The proceedings are currently in the discovery period. A final ruling is
still pending.

In April 2018, Trebol Minerals S.A. filed a civil claim against CODELCO”s El Salvador Division claiming
payment of unpaid services, damages, loss of profits and moral damages, plus interest thereon, in the amount of
approximately U.S.$12 million. The proceedings are currently in the discovery period. A final ruling is still pending.

In April 2017, Sociedad Comercial IMS Ltda. filed a commercial claim against CODELCO requesting
specific performance of an alleged agreement to supply uniforms for workers, as well as damages under several

concepts that, in the aggregate, amount to approximately U.S.$14.2 million. A final ruling is still pending.

CODELCO believes that it has meritorious defenses to the claims against it and, accordingly, is vigorously
defending its rights and interests in these proceedings.

For additional details related to CODELCOS*s litigation and contingencies and amounts of probable loss
with respect to lawsuits and legal actions, see note 29 to the Consolidated Financial Statements.

88
OVERVIEW OF THE COPPER MARKET

Copper is an internationally traded commodity, the price of which is effectively established on terminal
markets including the LME and COMEX. The following table sets forth quarterly average prices for refined copper
since 2017 on the LME:

Average Copper Price
(U.S.¿/Pound)

2017
First Quarter. 264.5
Second Quarter. 256.8
Third Quarter … 288.0
Fourth Quarter… 308.8
2018
First QUarteT.ococccoconnoncnonincnnnnnnnnnoncnonnnnnonnnnn cnn on on Dean nnR Dn nn Dian Rn ORO nO RR GR Dean RR RR RR ORD AR RR AR RRRROR OR RR Ra an en anar anna er anenananannns 315.7
Second Quarter. 311.7
Third Quarter 276.9
Fourth Quarter… 280.0
2019
First Quarter 281.9
Second Quarter. 277.3
Third Quarter. 263.2
Fourth Quarter… 266.8
2020
First QUarteT.ococccoconnoncnonincnnnnnnnnnoncnonnnnnonnnnn cnn on on Dean nnR Dn nn Dian Rn ORO nO RR GR Dean RR RR RR ORD AR RR AR RRRROR OR RR Ra an en anar anna er anenananannns 255.7
Second Quarter. 243.0
Third Quarter… 295.7
Fourth Quarter (through December 4, 2020) 315.1

Source: London Metal Exchange, Monthly Average Settlement.
On December 4, 2020, the closing price for refined copper on the LME was 351.2 cents per pound.

The following graph compares average market prices for copper and the level of LME, Shanghai Metal
Exchange and COMEX inventories from 1996 through September 30, 2020:

89
Copper Prices and Inventories on Commodities Exchanges

*000 tons c/lb

150 450
> socia ——— Copper pico

Source: Metal Exchanges: London, COMEX and Shanghai.

90
Historically, copper prices have been subject to wide fluctuations and are affected by numerous factors,
including international economic and political conditions, levels of supply and demand, the availability and costs
of substitutes, inventory levels maintained by producers and others and actions of participants in the commodities
markets. To a lesser extent, copper prices are also subject to the effects of inventory carrying costs and currency
exchange rates. In addition, the market prices of copper have occasionally been subject to rapid short-term
changes. See “Risk Factors—Risks Relating to CODELCO””s Operations—CODELCO’s business is highly
dependent upon the price of copper.”

Opportunities for Copper

Since 2005, copper prices have experienced significant volatility. LME copper prices averaged 272.1
cents per pound in 2019, compared to 295.9 cents per pound in 2018 and 279.9 cents per pound in 2017. While
higher copper prices in 2018 compared to prices in 2017 reflected an increased in global demand, higher
expectations on China and disruptions on the supply side, lower prices in 2019 reflected concerns on the trade
dispute between China and the U.S. and its impact on the global growth. In 2019, demand for copper is estimated
that remained flat, while supply would have increased 0.4%. See “Risk Factors—Risks Relating to CODELCO”s
Operations—CODELCO*s business is highly dependent upon the price of copper.”

There is also increased general use of copper tubing, particularly in air conditioning systems. The
quantity of copper consumed in electrical applications in cars, trains and other vehicles has also increased. In the
electricity generation and transmission area, the control of energy losses and a growing concern for higher energy
efficiency are factors that have tended to increase demand for copper, becoming the main copper usage. The
termination of widespread substitution of aluminum for copper in overhead high-voltage transmission lines also
bodes well for the metal”s future.

Historically, demand and supply of copper have demonstrated continued growth during periods of
oversupply as well as periods of overconsumption. The following graph shows the historical development of
copper supply, demand and stocks in the world from 2000 through 2019 (in thousands of metric tons):

Refined Copper Supply and Demand Worldwide Balance

25,000 1,500

e > rw a consompion

24,000 1250

23,000
1,000

22,000

21,000

20,000

19,000

18,000

17,000

16,000

500
15,000

750

14,000

13,000 , , , r , 1,000

0002.
to0z
zo0e
200%
ro0z
so0z
9002
2002
00z
coo
oro
troz
zuoz
so
moz
oz
sroz
£roz
soz
oz

Source: CODELCO, internal data (March 2020)

91
REGULATORY FRAMEWORK
Overview of the Regulatory Regime

CODELCO is a mining, industrial and commercial state-owned enterprise of indefinite duration with its
own legal personality and capital. CODELCO” relationship with the Government of Chile is conducted through
the Ministry of Mining. CODELCO was incorporated pursuant to Decree Law 1,350 of 1976, as amended by
Law 20,392, published in the Official Gazette on November 14, 2009, and effective as of March 1, 2010.
CODELCO is governed by Decree Law 1,350 and by Decree 146 of August 12, 1991, as amended (to conform the
same with Law 20,392) by Decree N* 3 of January 13, 2012 issued jointly by the Ministries of Finance and
Mining, and published in the Official Gazette on July 4, 2012, which sets forth CODELCO”s current bylaws, and
the general legal framework applicable to private companies regarding public disclosure (rules applicable to
publicly held companies), and other applicable regulations. CODELCO*s principal corporate purpose is to exercise
all rights acquired by Chile pursuant to the nationalization of the Chilean mining industry, namely mining,
exploration and the development of mining deposits and other rights belonging to Chile at the time of
CODELCOSs incorporation in 1976.

Principally, the amendments to Decree Law 1,350 contained in Law 20,392: (i) introduce best corporate
governance practices in conformity with recommendations made by the Organization for Economic Co-operation
and Development to CODELCO*s legal framework; (ii) make applicable the provisions of Law 18,046, (the
“Corporations Law”), to CODELCO); and (iii) vest in the President of Chile the authority and prerogatives
afforded to the shareholders of a corporation (sociedad anónima) under Chilean law, who may delegate such
authority to the Ministries of Finance and Mining, jointly. In addition, the amendments introduced significant
changes to the structure, designation and authority of the Board of Directors of CODELCO: (1) there are no longer
board member positions for the Ministers of Finance and Mining, nor for a representative of the armed forces;

(ii) directors must (a) hold a professional degree granted by a State-run or State-recognized university or college or
by an equivalent foreign university and (b) have at least five years” working experience as board members,
managers, administrators or main executives at public or private companies; (iii) directors representing the
workers and foremen are no longer appointed directly by the President of Chile, but rather are appointed by the
President of Chile from short-lists presented by the Federación de Trabajadores del Cobre (FTC) and both the
Federación de Sindicatos de Supervisores del Cobre (FESUC) and the Asociación Nacional de Supervsores del
Cobre (ANSCO), respectively; and (iv) directors are subject to the rules governing the rights, obligations,
responsibilities and prohibitions established in the Corporations Law.

CODELCO is subject to the supervision of: (i) the Chilean securities authority, the CMF, on the same
terms as publicly held corporations (CODELCO is registered under the Securities Registry N* 785 of the CMF)
and (ii) the Chilean Commission of Copper (Comisión Chilena del Cobre, or “COCHILCO”) or the governmental
agencies that, among other authorities, are responsible for examining the compliance with certain regulations
applicable to CODELCO*s activities and report the relevant findings to its Chief Executive Officer. Furthermore,
other government agencies in charge of specific areas, such as taxes and customs, exercise their legal authorities
with respect to CODELCO as they do in regard to any other company of the Chilean private sector. The Lower
House (Cámara de Diputados) of the Chilean Congress also maintains an overarching authority to oversee
CODELCO in the exercise of its constitutional duties.

Chilean law requires CODELCO to obtain the approval of the Ministry of Finance before it can assume
any financial indebtedness and before it can acquire assets outside Chile with financial or payment terms
exceeding one year. Although CODELCO is 100% owned by it, the Government of Chile is not legally liable for
CODELCOSs obligations unless expressly guaranteed by the Government of Chile, nor do such obligations form
any part of the direct public debt of the Government of Chile. A constitutional amendment would be required to
allow private participation in CODELCO”s ownership.

Each year, the Board of Directors must approve the BDP report of the Company for the following
three years, subject to the approval of the Ministries of Finance and Mining. This plan must include the annual
investment and financing amounts in addition to the annual profits that the Company is estimated to generate
during the period. The Ministries of Finance and Mining jointly issue a decree pursuant to which a portion of
CODELCOSs profit may be allocated by CODELCO to the creation of capitalization and reserve funds.

92
CODELCO”s Board of Directors must also submit its proposed annual budget to the Ministries of
Finance and Mining for approval. In addition, Decree Law 1,350 requires CODELCO to include as part of its
proposed annual budget a debt amortization budget that includes interest and principal payments on CODELCO”s
debts, including the notes. CODELCO””s budget and financial statements are subject to both internal and external
controls. CODELCO”s Board of Directors is responsible for monitoring its operations, and CODELCO retains
independent auditors to audit its consolidated financial statements and an internal comptroller to review its
finances, accounting and administration.

CODELCO”s Board of Directors approved corporate governance guidelines consistent with its high
transparency, probity and accountability standards which: (i) establish limits and controls on the use of resources
of the Board of Directors; (ii) implement a transparent and traceable system for the handling of hiring requests,
promotions and redundancies of CODELCO”s officers and employees; (iii) regulate the relationships between
members and management of the Board of Directors with related parties; and (iv) establish guidelines for
corporate speakers. CODELCO”s Board of Directors also agreed to consider directives that: (i) regulate lobbying
activities within CODELCO, (ii) strengthen and reform internal audit systems; and (iii) strengthen policies to
avoid any conflicts of interest.

Mining Regulations

Legal framework. CODELCO”s exploration, mining, milling, smelting and refining activities are subject
to Chilean laws and regulations which are generally applicable to all Chilean companies in the mining sector. The
legal framework which regulates CODELCO as a holder of mining concessions is contained in the Chile”s
Constitution, the Constitutional Law Governing Mining Concessions (Law 18,097 of January 21, 1982) and the
Mining Code (Law 18,248 of October 14, 1983). Under Chilean mining law, Chile is the owner of all mineral and
fossil substances, regardless of who owns the surface land in which such substances are located. Private persons
and companies may obtain mining concessions for exploration and exploitation. These concessions are granted by
judicial resolutions in accordance with the Mining Code.

Mining concessions are transferable, mortgageable and irrevocable and regulated by the same civil law
that regulates real estate rights generally. Generally, the owner of a mining concession may occupy as much of the
surface land as is necessary for mining activities upon the creation of a mining easement or upon other
authorization given by the land owner, such as a lease agreement or a license. Mining easements can be obtained
by way of direct negotiation with the surface land owner or, if the latter opposes, by way of a summary procedure
before the relevant court. Regardless of how the mining easement is obtained, the party granting the easement is
entitled to compensation should the mining activities and works caused by the owner of the mining concession
cause damage. Exploitation concessions have an indefinite duration. Exploration concessions are granted for
two years and may be extended for a maximum of two additional years subject to waiving at least half of the area
originally allocated. Prior to the expiration of the first or the second two-year period, exploration concessions can
be converted to exploitation concessions. If they are not so converted, the exploration concession terminates.

Owners of mining concessions must pay an annual fee equivalent to approximately U.S.$1.3 per hectare
in the case of exploration concessions and approximately U.S.$6.0 per hectare in the case of exploitation
concessions. However, the latter fees, within certain limits, may be credited to income taxes originated through the
exploitation of the concession. Payments of the annual fees must be made in March of each year. Failure to make
the annual fee payments may result in the loss of title to the concession through its auction.

CODELCO owns mining concessions granted by the Constitution and the Chilean Ordinary Courts for its
exploration and exploitation operations. Some of these concessions were previously held by foreign private mining
companies before being transferred to Chile in 1971 and subsequently to CODELCO upon its incorporation in
1976. CODELCOS*Ss principal concessions are those which give rights to the mineral deposits of the Chuquicamata,
El Teniente, Andina, Salvador, Radomiro Tomic, Gabriela Mistral and Mina Ministro Hales Divisions.
CODELCOS”s concessions relating to land that is currently being mined essentially grant an indefinite right to
conduct mining operations in that land, provided that annual concession fees are paid. In 2018, CODELCO paid
total concession fees of U.S.$7.5 million. In 2019, CODELCO paid total concession fees of U.S.$8.4 million.

Pursuant to the Mining Code, all mining concessions, as well as certain raw materials, assets and other
property permanently dedicated to the exploration or extraction of minerals cannot be subject, except in extremely
93
limited circumstances, to an order of attachment. In addition, pursuant to the Constitution, mining concessions
corresponding to mining deposits exploited by CODELCO upon its incorporation in 1976 cannot be subject to
attachment nor to any act of disposition by CODELCO. As a result, the rights of holders to attach property of
CODELCO in the event of a default under the notes would be limited by such provisions. See “Risk Factors—
Risks Relating to the Offering—In case of a default under the notes, the ability of holders to attach property of
CODELCO may be limited by Chilean law.”

Environmental Regulations

CODELCOS”s operations are subject to national, regional and local regulations as well as international
treaties subscribed by the Government of Chile and enacted as Chilean domestic law regarding the protection of
the environment, natural resources and the effect of the environment on human health and safety, including laws
and regulations concerning water, air and noise pollution, the handling, disposal and transportation of hazardous
waste and occupational health and safety.

The General Environmental Law (Law N* 19,300), enacted in March 1994 and modified by Law N*
20,417, enacted in 2010, establishes the general environmental legal framework in Chile, including the
establishment of a range of environmental management mechanisms known as the Environmental Impact
Assessment System (Sistema de Evaluación de Impacto Ambiental), the Emission Standards and the
Environmental Quality Standards, among others. Chilean environmental laws and regulations, and the
enforcement thereof, have become increasingly stringent since 2010 and even more due to recent changes. Such
amendments include, among other significant modifications, the creation of a new institutional framework
comprised by: (i) the Ministry of the Environment (Ministerio del Medio Ambiente); (11) the Council of Ministers
for Sustainability (Consejo de Ministros para la Sustentabilidad); (ii) the Environmental Assessment Service
(Servicio de Evaluación Ambiental); (iv) the Bureau of the Environment (Superintendencia del Medio Ambiente);
and (v) the Environmental Courts (Tribunales Ambientales), each of which are in charge of designing, evaluating
and enforcing laws and regulations relating to projects and activities that could have an environmental impact.
These institutions are fully operational. Recent legal and regulatory changes are likely to impose additional
restrictions or costs on CODELCO and also increased fines due to non-compliance with such laws and regulations,
relating to environmental litigation and protection of the environment, particularly those related to flora and fauna,
wildlife protected areas, water quality standards, mine closure, air emissions, and soil pollution. Since the Bureau
of the Environment became fully operational on December 28, 2012, infringement of environmental regulations
may result in fines of up to approximately U.S.$8.7 million, the closure of facilities and the revocation of
environmental approvals. As described in more detail below, CODELCO incurs, and may be required in the future
to incur, substantial capital and operating costs related to environmental compliance. However, many of these
costs are inextricably intertwined with the operation of CODELCO*s business as a whole.

The General Environmental Law, as complemented by additional regulations, enables the Government of
Chile to: (1) bring administrative and judicial proceedings against companies that violate environmental laws;
(ii) close non-complying facilities; (iii) revoke required operating licenses; (iv) require that companies to submit
their projects for environmental evaluation as required by applicable law; and (v) impose sanctions and fines when
companies act negligently, recklessly or deliberately in connection with environmental matters. The General
Environmental Law also grants citizens the right to bring civil actions against companies that are not in
compliance with environmental laws and regulations when such companies have caused “environmental damage,”
as defined in such law, after such non-compliance has been established by a judicial proceeding. As of the date of
this offering memorandum, one of these proceedings involves CODELCO, for an action brought by citizens
against all the companies that operate in the Ventanas area and the Ministry of the Environment. CODELCO is
unable to fully assess at this time the potential cost of compliance.

In 2016, the Bureau of the Environment presented claims against the Ventanas Division for the
infringement of environmental regulations and permits. In response, CODELCO presented a Compliance Plan
(Programa de Cumplimiento), which allows the Ventanas Division to comply with the Bureau of the
Environment’s requirements in a specified term and once successfully executed it may absolve the infringer from
fines or sanctions. This Compliance Plan was approved by the Bureau of the Environment in 2016 and was
implemented by CODELCO. In 2017 the Environmental Court required a complement of this plan to include the
evaluation of possible environmental consequences. CODELCO presented the required information and on
November, 28, 2018 the Bureau of the Environment approved the Compliance Program as satisfactorily fulfilled.

94
This approval decision was later appealed and ultimately upheld in August 2020 by the Environmental Court. In
September 2020, the Environmental Court’s ruling was appealed. A final decision from the Supreme Court is
pending.

Additionally, citizens affected by environmental pollution may file a petition for relief to Chilean Courts
of Appeal, requiring the suspension of the offending activity and the adoption of protective measures through the
judicial process called recurso de protección (constitutional protection action).

If determined that CODELCO violated its environmental permits, the Bureau of the Environment could
impose a fine on CODELCO and could require CODELCO to implement environmental compensation and
mitigation measures. There can be no assurance that the Bureau of the Environment, as a result of the Supreme
Court decision, will not impose additional fines or require that additional measures be taken. As of the date of this
offering memorandum, CODELCO has not assessed a potential loss as probable or such loss is not estimable.

The General Environmental Law and its regulations contain certain rules on Environmental Impact
Assessment, which have been in effect since April 1997, and that provide that CODELCO must evaluate the
environmental impact of any future project or activity listed in article 10 of Law 19,300 by means of an
environmental impact declaration or an environmental impact study depending on the significance of the
environmental impacts associated. CODELCO has conducted these environmental impact declarations and studies
pursuant to the General Environmental Law.

Chile has adopted environmental regulations requiring companies operating in Chile, including
CODELCO, to undertake programs to reduce, control and/or eliminate certain environmental impacts. CODELCO
has undertaken a number of environmental initiatives to comply with such regulations. From 2012 to 2019,
CODELCO invested U.S.$3.6 billion in environmental projects, and plans to continue implementing pollution
abatement plans through additional capital investments amounting to U.S.$439 million in 2020 and U.S.$490
million in 2021. In 2019, CODELCO allocated U.S.$834 million to environmental projects, including the
expansion of the Talabre, Ovejería and Carén Tailings dams in the Chuquicamata, Andina and El Teniente
Divisions and various projects in Chuquicamata, Potrerillos and Caletones smelters in order to comply with the
new regulation regarding atmospheric emissions. Additionally, as part of its pollution abatement efforts,
CODELCO continues to implement water recovery systems, the costs of which are also budgeted in CODELCO”s
pollution abatement plan, to conserve resources and minimize pollution of natural water sources.

To protect and improve environmental air quality in the country, the Ministry of the Environment has the
authority to declare certain areas to be “latent zones” (zonas latentes) or “saturated zones” (zonas saturadas).
Latent zones are areas in which there exists a high risk of excessive pollution — the pollutant concentration in air
water or soil is greater than 80% of the corresponding quality standard in a certain area — and in which further
emissions are highly restricted. Saturated zones are areas in which an excessive level of pollution already has been
reached — the concentration of the air pollutant exceeds 100% of the corresponding quality standard for a pollutant
in a certain area — and in which emissions are required to be reduced and mitigation measures are required to be
implemented. In connection with the declaration of a latent or saturated zone, the Ministry of the Environment
may initiate an investigation and public-consultation process to develop a prevention or decontamination plan, as
the case may be. The whole process for approving these plans may take more than two years. Upon publication of
either type of plan, emission reduction targets and other environmental remediation actions may be required of
specific industries located within the latent or saturated zone. Measures included in the pollution prevention or
reduction plans governing CODELCO”s operations are subject to change and may become more stringent if
compliance with applicable air quality standards is not achieved.

The area surrounding the Potrerillos, Caletones and Ventanas smelting facilities have been declared
saturated zones for particulate matter (PMio and/or MP5) and sulfur dioxide (SO»). These areas are subject to
decontamination plans. The Ventanas decontamination plan has been recently reviewed by government authorities.
In the areas surrounding the Chuquicamata smelter, there are decontamination plans for PM¡o under review and
under development, and a pollution prevention plan for SO, is currently under development. In August 2013, the
Ministry of the Environment enacted a decontamination plan for Chile”s Sixth Region, Central Valley, which
could potentially affect CODELCO”s operations in the region.

95
In addition, the relevant Environmental Assessment Service may impose further requirements on
CODELCOS*s projects. Under the various plans that cover the areas where CODELCO operates, net increases in
emissions by industrial facilities in these zones, including any increased emissions from the Potrerillos, Caletones,
Ventanas and Chuquicamata smelting plants, have been banned. As of the date of this offering memorandum, the
impact of operating in latent and saturated zones has not been material for CODELCO; however, it could have a
material effect in the future.

A new air quality standard for an additional pollutant, primary particulate matter PM,s, was enacted by
the Ministry of the Environment in 2011 and became effective in 2012. In 2015, a new saturated zone with respect
to PM>.5 and latent zone with respect to PM10 in the boroughs of Concón, Quintero and Puchuncavi, the areas
where Ventanas is located, was declared and, as a result, a new decontamination plan has been recently enacted.
CODELCO estimates that the cost of complying with this new standard will be U.S.$27 million, which will be
incurred over a period of approximately four years.

In 2013, Supreme Decree N* 28 of the Ministry of the Environment, on Emission Standard for Smelting
Plants was enacted, which establishes maximum parameters of emission for PM¡o, SO, arsenic (As) and mercury
(Hg) generated by smelting plants. Certain aspects of the regulation became effective immediately while other
provisions of the new emission standards must be complied with by a later date—within three years in the case of
Ventanas smelter, and within five years in Chuquicamata, Potrerillos and Caletones smelters. The cost of
complying with this new standard was U.S.$2.4 billion, which was incurred over a period of approximately five
years. This regulation is currently under routine review by the Ministry of the Environment, which is conducted
every five years.

Supreme Decree N*90/2001 of the General Secretary of the Presidency, which sets forth the standards for
discharges of liquid waste into surface water bodies, went into effect in 2006. CODELCO has invested significant
amounts to reduce liquid waste emissions to date and expects that it will continue to incur costs related to
compliance with Supreme Decree N* 90/2001. In addition, the authorities are developing water quality standards
for water bodies that CODELCO currently or may in the future discharge into, including the Loa, Aconcagua and
Cachapoal rivers. Such standards could require CODELCO to incur additional costs to manage liquid waste
discharges.

Regulations were enacted in February 2004 governing safety standards for mining operations. Pursuant to
these regulations, all mining companies, including CODELCO, were required to provide closure plans for their
mining facilities, demonstrating compliance with safety standards. These plans must be updated every five years
and must consider the requirements set forth in the environmental authorization issued for the respective facility, if
any. SERNAGEOMIN has approved the closure plans CODELCO prepared for all of its facilities.

A new mine closure regulation, Law N* 20,551, which includes health, safety and environmental
requirements along with mandatory provisions that require financial guarantees, was enacted in 2011, and became
effective in 2012. According to this law, CODELCO and other mining companies in Chile were required to submit
an assessment of the closure expenses of all its mines to the SERNAGEOMIN before 2014. Once the assessment
of closure expenses was approved, CODELCO had to provide the financial guarantee between the sixth months
since the approval and two-thirds of the project life (less than 20 years), or 15 years of the project life (more than
20 years). CODELCO obtained the approval of the closure plans for all of its Divisions from SERNAGEOMIN
and provided the financial guarantees in the term established by the law. CODELCO had total provisions
amounting to U.S.$1.6 billion for future decommissioning and site restoration costs primarily related to tailing
dams, closures of mine operations and other mining assets, including potential new governmental regulations, as
of December 31, 2018, and U.S.$2.0 billion as of December 31, 2019. CODELCO is currently developing a
project to estimate the additional costs of complying with this new regulation regarding mine closure, which could
be material.

On February 13, 2018, the Environmental Court (Tribunal Ambiental) in Antofagasta, Chile issued an
interim decision which could potentially reduce the availability of a minor source of water to CODELCO in the
city of Calama. As of the date of this offering memorandum, CODELCO: (i) is not a party to this legal proceeding;
and (ii) has not been contacted by any party or served by the Environmental Court. If and when CODELCO
becomes a party to this proceeding, CODELCO expects to: (a) enforce all its available legal remedies against any

96
adverse decision; and (b) implement operational mitigation measures, if necessary. In August 2018, the
Environmental Court voided its previous interim decision and subsequently during the month of August 2018 the
Bureau of the Environment desisted from its original action giving rise to such interim decision.

Future legislative or regulatory developments, private causes of action or the discovery of new facts
relating to environmental matters may impose new restrictions or result in additional costs that may have a
material adverse effect on CODELCO*s business, financial condition, results of operations or prospects. See “Risk
Factors—Risks Relating to CODELCO”s Operations—CODELCO”s compliance with environmental, health and
safety laws may require increased costs, including capital commitments, and non-compliance may subject it to
significant penalties.”

Enforceability of Obligations

CODELCO”s commercial obligations are enforceable in the same manner as those of any privately
owned company in Chile. Even though CODELCO is a state-owned enterprise, it is subject to the same laws and
regulations applicable to all private Chilean corporations. This principle is consistent with the constitution of 1980,
wherein Article 19, N* 21 states that if Chile and its bodies carry out commercial activities, they will be governed
by common legislation applicable to private persons, unless a specific law approved by an absolute majority of
representatives of the Chilean Congress dictates otherwise. No such law has been passed with respect to
CODELCO.

Payment of Obligations

Article 23 of Decree Law 1,350 provides that CODELCO has the obligation to return the total proceeds
of its exports to Chile, but has no obligation to convert the proceeds to Chilean pesos in excess of its peso
requirements. The proceeds from its exports are deposited at the Central Bank of Chile, and withdrawals against
such foreign exchange deposits are made to cover CODELCO’”s expenses. In addition, Article 13 of
Decree Law 1,350 directs CODELCO to prepare a Loan Amortization Budget which must include the payment of
principal of CODELCO”s debts and related interest payments, including the notes. This budget, as part of the
general budget of CODELCO, is approved annually by joint decree of the Ministry of Mining and the Ministry of
Finance and may be amended to meet non-budgeted expenses. The incurrence of any indebtedness by CODELCO
must be authorized by an official letter from the Ministry of Finance. For loans with maturity at issuance of a
duration of more than one year, this authorization is required to commence the relevant procedures.

Statutory Documents

The statutory documents of CODELCO are contained in Decree Law 1,350 published in the Official
Gazette on February 28, 1976, as amended by Law 20,392 published in the Official Gazette on
November 14, 2009, and Decree 146 published in the Official Gazette on October 25, 1991, as amended (to
conform the same with Law 20,392) by Decree N* 3 of January 13, 2012 issued jointly by the Ministries of
Finance and Mining, published in the Official Gazette on July 4, 2012. These gazettes may be seen on-line on the
Library of the Chilean Congress website (http://www.bcn.cl/ ) or in a booklet that CODELCO will issue upon
request, which contains free translations of the regulations into English.

97
MANAGEMENT

The Board of Directors is primarily responsible for the management and administration of CODELCO.
The Board of Directors is composed of nine members, appointed as set forth in Law 20,392, enacted on
November 4, 2009: (i) three directors are directly appointed by the President of Chile; (ii) four directors are
appointed by the President of Chile from a short-list presented by the Council of Senior Public Management
(Consejo de la Alta Dirección Pública), an entity within the National Civil Service Bureau that advises the
President of Chile, ministers and heads of services departments on the appointment of high-ranking public
positions; (iii) one director is appointed by the President of Chile from a short-list presented by the FTC; and
(iv) one director is appointed by the President of Chile from a short-list presented by both the FESUC and
ANSCO. All directors in CODELCO serve four year terms and may be reelected for new terms. The Board is
renewed on a staggered basis and may not be revoked in its entirety.

The Board of Directors is vested with all the management and asset-disposal authority, except to the
extent that Chilean law or CODELCO'”s bylaws establish such authority within the exclusive province of the
President of Chile (as discussed below), and other than the authority delegated to the Chief Executive Officer.
The main responsibilities of the Board of Directors of CODELCO are to: (i) designate and remove the Chief
Executive Officer; (11) approve and send to the Ministry of Finance an estimate of the revenues and surplus
earnings that it will transfer to the Government of Chile in the following year”s budget; (iii) prepare the annual
budget of CODELCO and send for the approval of the Ministry of Finance; and (iv) approve the BDP report of the
Company for the following three-year period.

The President of Chile is vested with authority analogous to that of the shareholders of a corporation
(sociedad anónima) under Chilean law, which may be delegated in whole or in part to the Ministers of Finance
and Mining, jointly. Pursuant to such authority, the President of Chile: (i) participates in the designation of the
Board of Directors by designating three directors without external input and by electing six directors on the basis
of third-party short-lists; (1i) appoints the Chairman of the Board of Directors; and (iii) may approve and amend
the bylaws of the Company, by means of an executive decree issued jointly by the Ministries of Finance and
Mining. See “Risk Factors — Risks Relating to CODELCO”s Relationship with the Government of Chile.”

Senior management and administration of the Company are vested in its Board of Directors and Chief
Executive Officer. The Board of Directors is in charge of the ultimate conduct and oversight of the Company. The
Chief Executive Officer is named by the Board of Directors and remains in office so long as he/she maintains the
confidence of the Board. The Chief Executive Officer is responsible for implementing the resolutions of the Board
of Directors and supervising the activities of CODELCO. On July 12, 2019, the Board of Directors of CODELCO
appointed Octavio Araneda Osés as the new CEO, and he commenced his term on September 1, 2019.

On March 1, 2018, CODELCO announced the appointment of Christian Toutin as General Manager of
the Salvador Division. On April 1, 2018, CODELCO announced the appointment of Roberto Ecclerfield as Vice
President of Sales. On April 27, 2018, CODELCO announced the appointment of Nicolás Rivera as General
Manager of the El Teniente Division. On September 28, 2018, CODELCO announced the appointment of Marcelo
Alvarez Jara as Vice President of Human Resources.

On December 27, 2018, CODELCO announced the appointment of Renato Fernandez Baeza as Vice
President of Corporate Affairs $ Sustainability. On January 16, 2019, CODELCO announced the appointment of
José Pesce Rosenthal as the Acting Vice President of Corporate Affairs $ Sustainability, in addition to his
responsibilities as Vice President of Mining Resources Management and Development, until February 18, 2019
when Renato Fernandez Baeza assumed such position on a permanent basis, until April 20, 2020.

On March 1, 2019, CODELCO announced the appointment Sergio Herbage Lundín, former Northern
District Development Manager, as the General Manager of the Gabriela Mistral Division. The same day,
CODELCO announced the appointment of Jaime Rivera Machado, former General Manager of the Mina Ministro
Hales Division, as the General Manager of Andina Division, and the appointment of Andrés Music Garrido,
former Mine Manager El Teniente Division, as the General Manager of the Mina Ministro Hales Division. Finally,
CODELCO announced the appointment of Alvaro García Gonzalez as CODELCO”s first Vice President of
Technology.

98
On July 26, 2019, CODELCO announced the appointment of Mauricio Barraza Gallardo, former General
Manager of the Chuquicamata Divison, as Vice President of Central Southern Operations. The same day,
CODELCO announced the appointment of Nicolás Rivera Rodriguez, former General Manager of the El Teniente
Division, as the General Manager of the Chuquicamata Division, and the appointment of Andrés Music Garrido,
the former General Manager of Mina Ministro Hales, as the General Manager of the El Teniente Division. On
August 29, 2019, CODELCO announced the appointment of Rodrigo Barrera, former Chuquicata Underground
Project Manager, as the General Manager of the Mina Ministro Hales Division. All new positions were effective as
of September 1, 2019.

On January 31, 2020, CODELCO announced the appointment of Lorena Ferreiro Vidal as General
Counsel and created the position Vice Presidency of Smelters and Refiners, appointing José Sanhueza Reyes in the
role. Both appointments are effective as of March 1, 2020. On February 28, 2020, CODELCO announced the
appointment of Cristián Cortés Egaña as acting General Manager for Ventanas Division, effective on March 1,
2020. On March 2, 2020, CODELCO announced the appointment of Patricio Vergara Lara as Vice President of
Mining Resources Management and Development, effective on April 20, 2020.

On September 29, 2020, CODELCO announced the appointment of Ricardo Weishaupt Hidalgo as
General Manager of Ventanas Division, effective on November 1, 2020.

On October 2, 2020 CODELCO announced the appointment of Mauricio Barraza Gallardo as acting Vice
President — Northern Operations and Alejandro Rivera Stambuck as acting Vice President — Productivity and
Costs, both positions effective as of October 16, 2020. Mr. Mauricio Barraza Gallardo and Mr. Alejandro Rivera
Stambuck will also maintain their current positions as Vice President — Central Southern Operations and Chief
Financial Officer, respectively.

On October 30, 2020 CODELCO announced the appointment of Carlos Alvarado Hernández as Vice
President of Sales and Rodrigo Miranda Schleyer as acting General Auditor, both positions effective on November
1, 2020. The same day, CODELCO announced the appointment of Rodrigo Barrera Paez, former General Manager
Of Mina Ministro Hales Division, as General Manager of Andina Division, and Francisco Balsebre Olaran as
acting General Manager of Mina Ministro Hales Division, both positions effective on December 1, 2020.

99
Directors and Executive Officers

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(4)
(5)

(6)

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The following table sets forth the current directors and executive officers of CODELCO and their
positions:

Name

Directors

Juan Benavides Feliú
Juan Enrique Morales Jaramillo
Blas Tomic Errázuriz…
Paul Schiodtz Obilinovich .
Isidoro Palma Penco
Hernán de Solminihac Tampier
Ghassan Dayoub Pseli
Rodrigo Cerda Norambuena .ocicicinininnnnnonnnncnnnnncncnonononananncnn

Executive Officers
Octavio Araneda OSSES ..cocococonccnonononnnocnnnonanonoononaronocnrnnnroninnos
Alejandro Rivera StaMbUk…conniininininninnnonnnnniniionccananos

Marcelo Alvarez Jara
Carlos Alvarado Hernandez
Gerhard von Borries Harms
Patricio Vergara Lara

SAA RA
Alvaro García Gonzalez
José Sanhueza Reyes….
Alejandro Sanhueza Diaz
Lorena Ferreiro Vidal …..
Rodrigo Miranda Schleyer.
Mauricio Barraza Gallardo.

Nicolás Rivera Rodriguez ..ooonncnnninnnnnnnnnononnnonananonncncanncncnanos
Lindor Quiroga Bugueño…
Francisco Balsebre Olaran .
Sergio Herbage Lundín
Christian Toutin ..
Ricardo Weishaupt Hidalgo
Andrés Music Garrido..
Rodrigo Barrera Páez…

Directly appointed by the President of Chile.
Term expires May 2022.

Position

ChairmanV0
Director 4
Director)
Director)
Director 4
DirectorM4)
Director(04
DirectorVW)

Chief Executive Officer and President

Chief Financial Officer and acting Vice President —
Productivity and Costs

Vice President — Human Resources

Vice President of Sales

Vice President — Projects

Vice President — Mining Resources Management and
Development

Vice President — Corporate Affairs 8£ Sustainability
Vice President — Technology

Vice President of Smelters and Refineries

Head of Finance

General Counsel

General Auditor

Vice President — Central Southern Operations and
acting Vice President — Northern Operations
General Manager — Chuquicamata Division
General Manager — Radomiro Tomic Division
General Manager — Mina Ministro Hales Division
General Manager — Gabriela Mistral Division
General Manager — Salvador Division

General Manager — Ventanas Division

General Manager — El Teniente Division

General Manager — Andina Division

Appointed by the President of Chile from a short list presented by the Council of Senior Public Management (Consejo de la Alta

Dirección Pública).
Term expires May 2023.
Term expires May 2021.

Employee of CODELCO, appointed by the President of Chile from a short list presented by the Federation of Copper Supervisors and the

National Association of Copper Supervisors.

Directly appointed by the President of Chile. Term expires May 2022.

There is no family relationship between any director or executive officer and any other director or
executive officer. The business address for the executives and directors previously listed is Huérfanos 1270,
6th floor, Santiago, Chile. No executive holds a position as an employee outside of CODELCO.

100
Committees of the Board of Directors
Audit, Benefits and Ethics Committee (Comité de Auditoría, Compensaciones y Ética)

CODELCOS”s audit, benefits and ethics committee consists of Blas Tomic Errázuriz (Chair), Isidoro
Palma Penco (Vice Chair), Juan Enrique Morales Jaramillo and Paul Schiodtz Obilinovich, who may invite others
to assist in its work. The audit, benefits and ethics committee”s primary responsibility is to support the Board of
Directors by providing and improving internal controls by reviewing transactions with related parties and the work
of CODELCO*s internal audit department. The committee also analyzes and reviews the work and reports of the
external auditors. The committee is also responsible for analyzing observations made by Chilean regulatory
entities and for recommending measures to be taken by the management in response. CODELCO”s audit, benefits
and ethics committee is not subject to the independence and other requirements to which U.S. public companies
are subject.

Projects and Investment Committee (Comité de Proyectos y Financiamiento de Inversiones)

The projects and investment committee consists of Isidoro Palma Penco (Chair), Juan Enrique Morales
Jaramillo (Vice Chair), Paul Schiodtz Obilinovich and Rodrigo Cerda Norambuena. This committee analyzes and
recommends major mining development projects and financing of these projects.

Management Committee (Comité de Gestión)

The management committee consists of Hernán De Solminihac Tampier (Chair), Isidoro Palma Penco
(Vice Chair), Rodrigo Cerda Norambuena and Ghassan Dayoub Pseli. The committee is primarily responsible for
the management of the Company”s divisions and key projects. It also reviews and evaluates the performance of
subsidiaries and affiliated companies.

Sustainability Committee (Comité de Sustentabilidad)

The sustainability committee consists of Paul Schiodtz Obilinovich (Chair), Hernán De Solminihac
Tampier (Vice Chair), Blas Tomic Errázuriz, Juan Enrique Morales Jaramillo and Ghassan Dayoub Pseli. The
committee advises the Board of Directors with respect to matters of sustainability, providing assistance to the
Board of Directors in the Company”s sustainability policies and goals as well as analyzing the efficacy of the
Company”s policies and management systems in the areas of health, safety and the environment.

Science, Technology and Innovation Committee (Comité de Ciencias, Tecnología e Innovación)

The science, technology and innovation committee consists of Juan Enrique Morales Jaramillo (Chair),
Paul Schiodtz Obilinovich (Vice Chair), Hernán De Solminihac Tampier, Rodrigo Cerda Norambuena and
Ghassan Dayoub Pseli. This committee was formed in 2016 and discusses the challenges facing the corporation
with respect to science and technology.

101
RELATED PARTY TRANSACTIONS

In the ordinary course of its business, CODELCO engages in a variety of transactions on arm”s-length
terms with certain related parties. For information regarding these transactions, see note 3 to the Consolidated
Financial Statements.

In its dealings with Cyprus El Abra Corporation (a subsidiary of Freeport-McMoRan Inc.), the partner in
SCM El Abra, CODELCO acts through a subsidiary, as agent. CODELCO does not sell copper to Nordeutsche
Affinerie Group, its partner in Deutsche Giessradht GmbH.

Pursuant to Article 147 of the Corporations Law, CODELCO may only enter into operations with related
parties if its intent is to benefit the corporate interest, if its price, terms and conditions are consistent with those
prevailing in the market when approved, and if it follows certain requirements and procedures established by the
law.

According to Article 146 of the Corporations Law, as amended, “operations with related parties” of
CODELCO include any and all negotiations, acts, contracts or operations in which the Company must take part, as
well as:

(1) one or more related persons to the Company, pursuant to the definition contained in Article 100
of Law 18,045 (the “Securities Market Law,” as amended);

(1) a board member, manager, a main executive or a liquidator of CODELCO, acting directly or on
behalf of any persons other than the Company, or their respective spouses or relatives up to the
second degree (consanguinity or affinity);

[6559) a corporation or partnership in which one of the persons mentioned in (ii) above are direct or
indirect owners of 10% or more of its capital, board members, managers or main executives;

(iv) those persons specifically established under CODELCO”s bylaws or reasonably identified by the
Directors” Committee, as applicable, even if the transaction with such persons (a) is not of a
relevant amount, (b) is conducted on a regular basis (as per the regularity policy determined by
the Board of Directors of CODELCO) or (c) is entered into with a subsidiary of CODELCO in
which the Company holds a direct or indirect ownership interest of at least 95%; and

(v) any company in which a board member, manager or main executive of CODELCO has served as
a board member, manager, main executive or liquidator, during the last 18 months.

Article 100 of the Securities Market Law provides that the following persons constitute a related party:
(i) the other entities of the business conglomerate to which a company belongs; (ii) parents, subsidiaries and
equity-method investors and investees of a company; (iii) all directors, managers, officers and liquidators of a
company, and their spouses or blood relatives to the second degree, or any entity controlled, directly or indirectly,
by any of the abovementioned individuals; (iv) any person that, by their own actions or with other persons under a
joint action agreement, may appoint at least one member of the management of a company or controls 10% or
more of the capital or voting capital of a stock company; and (v) other entities or persons deemed a related party
by the CMF.

The rules, requirements and procedures to approve operations with related parties apply both to the
operations of CODELCO as well as to those of its subsidiaries, regardless of their legal nature, except for some
exemptions set forth in Article 147 of the Corporations Law in which related-party transaction may be executed
without the requirements referred to above, with the prior approval of the Board of Directors.

The breach of any of the restrictions on related party transactions will not affect the validity of the

transaction. However, CODELCO or the President of Chile may demand from the breaching party, the
reimbursement for an amount equivalent to the benefits gained by the breaching party resulting from the

102
transaction. Additionally, CODELCO or the President of Chile may claim damages. Finally, the breaching party
bears the burden of proof that the transaction was carried out according to the law.

CODELCOSs policy for transactions with related parties is defined and governed by a specific internal
regulation created pursuant to general policies established by the Board of Directors and in connection with the
guidance provided by Decree Law 1,350 and the Corporations Law. CODELCOs internal regulation prescribes
the manner in which transactions between CODELCO and related entities must be carried out and provides for
sanctions if the requirements of the regulation are not met.

103
FOREIGN INVESTMENT AND EXCHANGE CONTROLS IN CHILE

As a general matter, the Central Bank of Chile is, among other things, responsible for monetary policies
and for exchange controls in Chile. Most Chilean companies must inform the Central Bank of any international
issue Of bonds and if the proceeds of the issuance are not left abroad, should be brought into Chile through a bank
or other participant in the Formal Exchange Market. Article 23 of Decree Law 1,350 provides that CODELCO has
an obligation to return the total proceeds of its exports to Chile, but has no obligation to convert such proceeds to
Chilean pesos beyond its peso requirements. These proceeds from its exports are deposited at the Central Bank of
Chile, and withdrawals against such foreign exchange deposits are made to cover CODELCO”s expenses. As a
result, CODELCO does not require foreign exchange approval in connection with the issuance or placement of, or
payments upon the notes. See “Regulatory Framework—Payment of Obligations.”

104
DESCRIPTION OF NOTES

The notes will be issued pursuant to an indenture, dated as of February 5, 2019 (the “base indenture”),
among CODELCO, The Bank of New York Mellon, as trustee, paying agent, transfer agent and registrar (the
“trustee”), and The Bank of New York Mellon SA/NV, Luxembourg Branch, as Luxembourg paying agent (the
“Luxembourg Agent”), as amended and supplemented by the Ninth Supplemental Indenture, to be dated as of
December 14, 2020 (together with the base indenture, the “Indenture”), between CODELCO and the trustee.

The following description of certain provisions of the notes and of the indenture is subject to and is
qualified in its entirety by reference to the provisions of the notes and the indenture, copies of which will be
available for inspection at the office of the trustee at 240 Greenwich Street, Floor 7 East, New York, New York
10286. CODELCO urges you to read the indenture because it, and not this description, defines your rights as
holders of’ the notes issued under the indenture.

General

The notes will be issued by CODELCO, and CODELCO will be liable therefor and obligated to perform
all covenants and agreements to be performed by CODELCO pursuant to the notes and the indenture, including
the obligations to pay principal, interest and Additional Amounts (as defined below under “Payment of Additional
Amounts”), if any. The trustee under the indenture is The Bank of New York Mellon (the “trustee,” which term
shall include any successor trustee under the indenture).

The indenture provides for the issuance by CODELCO from time to time of notes in one or more series
up to an aggregate principal amount of notes as from time to time may be authorized by CODELCO, subject to all
required government authorizations. Notes having the same date of maturity and Interest Payment Dates (as
defined below), payable in the same currency, bearing interest at the same rate and the terms of which are
otherwise identical, are referred to as a “series.”

The notes will bear interest at the applicable rate per annum set forth on the cover page of this offering
memorandum from the date of issuance or from the most recent Interest Payment Date (as defined below) to which
interest has been paid or provided for. Interest on the notes will be payable semi-annually in arrears on January 15
and July 15 of each year, commencing on July 15, 2021, or, if any such date is not a Business Day (as defined
below), on the next succeeding Business Day (each an “Interest Payment Date”) to the person or persons (each, a
“Holder”) in whose name such notes are registered in the Security Register (as defined below) at the close of
business on December 31 and June 30, respectively, preceding such Interest Payment Dates (each a “Record
Date”). Interest on the notes will be calculated on the basis of a 360-day year of twelve 30-day months. For the
purposes hereof, the term “Business Day” means a day on which banks in The City of New York are not
authorized or required by law or executive order to be closed.

Moneys paid by CODELCO to the trustee or any paying agent for the payment of principal of (and
premium, if any) or interest on any of the notes and remaining unclaimed at the end of two years after the date on
which such principal (and premium, if any) or interest shall have become due and payable (whether at maturity,
upon call for redemption or otherwise) shall, together with interest made available for payment thereof, be repaid
to CODELCO, whereupon all liability of the trustee or such paying agent with respect to such moneys shall cease.

The notes will mature on January 15, 2051. The notes will not be redeemable prior to maturity except as
described below and in the event of certain developments affecting taxation, in that case at a price equal to the
outstanding principal amount thereof, together with any Additional Amounts and accrued interest to the
redemption date. On the maturity date of the notes, CODELCO will be required to pay 100% of the then
outstanding principal amount of the notes plus accrued and unpaid interest thereon and Additional Amounts, if
any.

Ranking

The notes will constitute direct, general, unsecured, unconditional and unsubordinated obligations of
CODELCO. The notes rank and will rank without any preference among them and equally with all other
unsecured and unsubordinated obligations of CODELCO, other than certain obligations granted preferential

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treatment pursuant to Chilean law. It is understood that this provision will not be construed so as to require
CODELCO to make payments under the notes ratably with payments being made under any other obligations. The
indenture contains no restriction on the amount of additional indebtedness which may be incurred by CODELCO
or its subsidiaries; however, as set forth under “—Limitation on Liens” below, the indenture contains certain
restrictions on the ability of CODELCO and its subsidiaries to incur secured indebtedness.

Registration, Form and Delivery

The trustee will initially act as paying agent, transfer agent and registrar for the notes. The notes will be
issued upon the closing of this offering in definitive, fully registered form, without coupons, in denominations of
U.S.$200,000 principal amount at maturity and multiples of U.S.$1,000 in excess thereof. The notes will be
exchangeable, and transfers thereof will be registrable, at the office of the registrar for the notes. No charge will be
made to holders of the notes in connection with any exchange or registration of transfer, but CODELCO may
require payment of a sum sufficient to cover any tax or other governmental charge payable in that connection.

The trustee will maintain at its office in the City of New York, currently located at 240 Greenwich Street,
Floor 7 East, New York, New York 10286, a security register (the “Security Register”) with respect to the notes.
The name and address of the registered Holder of each note and the amount of each note will be recorded in the
applicable Security Register, and the trustee and CODELCO may treat the person in whose name the note is
registered as the owner of such note for all purposes. For so long as the notes are represented by one or more
Global Notes, the registered owner of a Global Note, in accordance with the terms of the indenture, may be treated
at all times and for all purposes by CODELCO and the trustee as the sole owner with respect to such notes, with
respect to all payments on the notes and for all other purposes under the terms of the notes and the indenture.

The notes are being offered and sold in connection with the initial offering thereof solely to “qualified
institutional buyers,” as that term is defined in Rule 144A under the Securities Act, pursuant to Rule 144A, and in
offshore transactions to persons other than “U.S. persons,” as defined in Regulation S under the Securities Act, in
reliance on Regulation S. Following the initial offering of the notes, the notes may be resold to qualified
institutional buyers pursuant to Rule 144A, non-U.S. persons in reliance on RegulationS and pursuant to
Rule 144 under the Securities Act, as described under “Transfer Restrictions.”

The Global Notes
Rule 1444 Global Note

The notes offered and sold to qualified institutional buyers pursuant to Rule 144A will initially be issued
in the form of one or more registered notes in global form, without interest coupons. The Rule 144A Global Notes
will be deposited on the date of the closing of the sale of the notes with, or on behalf of, the Depository Trust
Company, or DTC, and registered in the name of Cede £ Co., as nominee of DTC, or will remain in the custody
of the trustee pursuant to the FAST Balance Certificate Agreement between DTC and the trustee. Interests in the
Rule 144A Global Note will be available for purchase only by qualified institutional buyers.

Regulation S Global Note

The notes offered and sold in offshore transactions to non-U.S. persons in reliance on Regulation S under
the Securities Act will initially be issued in the form of one or more registered notes in global form, without
interest coupons. The Regulation S Global Notes will be deposited upon issuance with, or on behalf of, a custodian
for DTC in the manner described in the preceding paragraph.

Except as set forth below, the Rule 144A Global Note and the Regulation S Global Note, collectively
referred to in this section as the “Global Notes,” may be transferred, in whole and not in part, solely to another
nominee of DTC or to a successor of DTC or its nominee. Beneficial interests in the Global Notes may not be
exchanged for notes in physical, certificated form (referred to as “certificated notes”) except in the limited
circumstances described below.

The notes will be subject to certain restrictions on transfer and will bear a restrictive legend as set forth
under “Transfer Restrictions.”

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All interests in the Global Notes are subject to the procedures and requirements of DTC. Those interests
held through Euroclear or Clearstream are subject to the procedures and requirements of such systems.

Euroclear and Clearstream will hold interests in the Global Notes on behalf of their participants through
customers” securities accounts in their respective names on the books of their respective depositaries. Such
depositaries, in turn, will hold such interests in the Global Notes in customers” securities accounts in the
depositaries? names on the books of DTC.

Exchanges Among the Global Notes

Prior to the 40th day after the later of the commencement of the offering of the notes and the date of the
closing of the sale of the notes (the period through and including the 40th day, the “restricted period”), transfers by
an owner of a beneficial interest in the Regulation S Global Note to a transferee who takes delivery of this interest
through the corresponding Rule 144A Global Note will be made only in accordance with applicable procedures
and upon receipt by the trustee of a written certification from the transferor of the beneficial interest in the form
provided in the indenture to the effect that such transfer is being made to a person whom the transferor reasonably
believes is a qualified institutional buyer within the meaning of Rule 144A in a transaction meeting the
requirements of Rule 144A. Such written certification will no longer be required after the expiration of the
restricted period.

Transfers by an owner of a beneficial interest in the Rule 144A Global Note to a transferee who takes
delivery of such interest through the corresponding Regulation S Global Note, whether before or after the
expiration of the restricted period, will be made only upon receipt by the trustee of a certification from the
transferor to the effect that such transfer is being made in accordance with Regulation S under the Securities Act.

Any beneficial interest in one of the Global Notes that is transferred to a person who takes delivery in the
form of an interest in another Global Note will, upon transfer, cease to be an interest in such Global Note and
become an interest in the other Global Note and, accordingly, will thereafter be subject to all transfer restrictions,
if any, and other procedures applicable to beneficial interests in such other Global Note for as long as it remains
such an interest.

Certain Book-Entry Procedures for the Global Notes

The descriptions of the operations and procedures of DTC, Euroclear and Clearstream set forth below are
provided solely as a matter of convenience. These operations and procedures are solely within the control of the
respective settlement systems and are subject to change by them from time to time. Neither CODELCO nor the
initial purchasers take any responsibility for these operations or procedures, and investors are urged to contact the
relevant system or its participants directly to discuss these matters.

DTC has advised CODELCO that it is (1) a limited purpose trust company organized under the laws of
the State of New York, (ii) a “banking organization” within the meaning of the New York Banking Law,
(iii) a member of the Federal Reserve System, (iv) a “clearing corporation” within the meaning of the Uniform
Commercial Code, as amended, and (v) a “clearing agency” registered pursuant to Section 17A of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”). DTC was created to hold securities for its participants
and facilitates the clearance and settlement of securities transactions between participants through electronic
book-entry changes to the accounts of its participants, thereby eliminating the need for physical transfer and
delivery of certificates. DTC”s participants include securities brokers and dealers (including the initial purchasers),
banks and trust companies, clearing corporations and certain other organizations. Indirect access to DTC”s system
is also available to other entities such as banks, brokers, dealers and trust companies, or indirect participants that
clear through or maintain a custodial relationship with a participant, either directly or indirectly. Investors who are
not participants may beneficially own securities held by or on behalf of DTC only through participants or indirect
participants.

CODELCO expects that pursuant to procedures established by DTC (1) upon deposit of each Global Note,
DTC will credit the accounts of participants designated by the initial purchasers with an interest in the Global Note

and (ii) ownership of the notes will be shown on, and the transfer of ownership thereof will be effected only

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through, records maintained by DTC (with respect to the interests of participants) and the records of participants
and the indirect participants (with respect to the interests of persons other than participants).

The laws of some jurisdictions may require that certain purchasers of securities take physical delivery of
such securities in definitive form. Accordingly, the ability to transfer interests in the notes represented by a Global
Note to such persons may be limited. In addition, because DTC can act only on behalf of its participants, who in
turn act on behalf of persons who hold interests through participants, the ability of a person having an interest in
notes represented by a Global Note to pledge or transfer such interest to persons or entities that do not participate
in DTC”s system, or to otherwise take actions in respect of such interest, may be affected by the lack of a physical
definitive security in respect of such interest.

So long as DTC or its nominee is the registered owner of a Global Note, DTC or such nominee, as the
case may be, will be considered the sole owner or holder of the notes represented by the Global Note for all
purposes under the indenture. Except as provided below, owners of beneficial interests in a Global Note will not
be entitled to have notes represented by such Global Note registered in their names, will not receive or be entitled
to receive physical delivery of certificated notes, and will not be considered the owners or holders thereof under
the indenture for any purpose, including with respect to the giving of any direction, instruction or approval to the
trustee thereunder. Accordingly, each holder owning a beneficial interest in a Global Note must rely on the
procedures of DTC and, if such holder is not a participant or an indirect participant, on the procedures of the
participant through which such holder owns its interest, to exercise any rights of a holder of notes under the
indenture or such Global Note. CODELCO understands that under existing industry practice, in the event that
CODELCO requests any action of holders of notes, or a holder that is an owner of a beneficial interest in a Global
Note desires to take any action that DTC, as the holder of such Global Note, is entitled to take, DTC would
authorize the participants to take such action and the participants would authorize holders owning through such
participants to take such action or would otherwise act upon the instruction of such holders. Neither CODELCO
nor the trustee will have any responsibility or liability for any aspect of the records relating to, or payments made
on account of, notes by DTC, or for maintaining, supervising or reviewing any records of DTC relating to such
notes.

Payments with respect to the principal of, premium, if any, and interest on any notes represented by a
Global Note registered in the name of DTC or its nominee on the applicable Record Date will be payable by the
trustee to or at the direction of DTC or its nominee in its capacity as the registered holder of the Global Note
representing such notes under the indenture. Under the terms of the indenture, CODELCO and the trustee may
treat the persons in whose names the notes, including the Global Notes, are registered as the owners thereof for the
purpose of receiving payment thereon and for any and all other purposes whatsoever. Accordingly, neither
CODELCO nor the trustee has or will have any responsibility or liability for the payment of such amounts to
owners of beneficial interests in a Global Note (including principal, premium, if any, and interest). Payments by
the participants and the indirect participants to the owners of beneficial interests in a Global Note will be governed
by standing instructions and customary industry practice and will be the responsibility of the participants or the
indirect participants and DTC.

Transfers between participants in DTC will be effected in accordance with DTC”s procedures, and will be
settled in same-day funds. Transfers between participants in Euroclear or Clearstream will be effected in the
ordinary way in accordance with their respective rules and operating procedures.

Subject to compliance with the transfer restrictions applicable to the notes, cross-market transfers
between the participants in DTC, on the one hand, and Euroclear or Clearstream participants, on the other hand,
will be effected through DTC in accordance with DTC”s rules on behalf of Euroclear or Clearstream, as the case
may be, by its respective depositary. However, such cross-market transactions will require delivery of instructions
to Euroclear or Clearstream, as the case may be, by the counterparty in such system in accordance with the rules
and procedures and within the established deadlines of such system. Euroclear or Clearstream, as the case may be,
will, if the transaction meets its settlement requirements, deliver instructions to its respective depositary to take
action to effect final settlement on its behalf by delivering or receiving interests in the relevant Global Notes in
DTC, and making or receiving payment in accordance with normal procedures for same-day funds settlement
applicable to DTC. Euroclear participants and Clearstream participants may not deliver instructions directly to the
depositaries for Euroclear or Clearstream.

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Because of time zone differences, the securities account of a Euroclear or Clearstream participant
purchasing an interest in a Global Note from a participant in DTC will be credited, and any such crediting will be
reported to the relevant Euroclear or Clearstream participant, during the securities settlement processing day
(which must be a business day for Euroclear and Clearstream) immediately following the settlement date of DTC.
Cash received in Euroclear or Clearstream as a result of sales of interest in a global security by or through a
Euroclear or Clearstream participant to a participant in DTC will be received with value on the settlement date of
DTC but will be available in the relevant Euroclear or Clearstream cash account only as of the business day for
Euroclear or Clearstream following DTC”s settlement date.

Although DTC, Euroclear and Clearstream have agreed to the foregoing procedures to facilitate transfers
of interests in the Global Notes among participants in DTC, Euroclear and Clearstream, they are under no
obligation to perform or to continue to perform such procedures, and such procedures may be discontinued at any
time. Neither CODELCO nor the trustee will have any responsibility for the performance by DTC, Euroclear or
Clearstream or their respective participants or indirect participants of their respective obligations under the rules
and procedures governing their operations.

Certificated Notes

With respect to the notes, if (1) CODELCO notifies the trustee in writing that DTC is no longer willing or
able to act as a depositary or DTC ceases to be registered as a clearing agency under the Exchange Act and a
successor depositary is not appointed within 90 days of such notice or cessation; (ii) CODELCO, at its option,
notifies the trustee in writing that it elects to cause the issuance of notes in definitive form under the indenture; or
(iii) upon the occurrence of certain other events as provided in the indenture, then, upon surrender by DTC of the
Global Notes, certificated notes will be issued to each person that DTC identifies as the beneficial owner of the
notes represented by the Global Notes. Upon any such issuance, the trustee is required to register such certificated
notes in the name of such person or persons (or the nominee of any thereof) and cause the same to be delivered
thereto.

Neither CODELCO nor the trustee shall be liable for any delay by DTC or any participant or indirect
participant in identifying the beneficial owners of the related notes and CODELCO and the trustee may
conclusively rely on, and shall be protected in relying on, instructions from DTC for all purposes (including with
respect to the registration and delivery, and the respective principal amounts, of the notes to be issued).

Covenants

CODELCO has agreed to restrictions on its activities for the benefit of holders of the notes. The
following restrictions will apply to the notes:

Consolidation, Merger, Conveyance, Sale or Lease

Nothing contained in the indenture prevents CODELCO from consolidating with or merging into another
corporation or conveying, transferring or leasing its properties and assets substantially as an entirety to any person,
provided that: (i) the corporation formed by such consolidation or into which CODELCO is merged or the person
which acquires by conveyance or transfer, or which leases, the properties and assets of CODELCO substantially as
an entirety is a corporation organized and existing under the laws of Chile and expressly assumes, by supplemental
indenture, the due and punctual payment of the principal of and interest and Additional Amounts, if any, on all
outstanding notes and the performance of every covenant in the indenture on the part of CODELCO to be
performed or observed; (ii) immediately after giving effect to such transaction no Event of Default (as defined
below), and no event which, after notice or lapse of time or both, would become an Event of Default, shall have
happened and be continuing; and (iii) CODELCO has delivered to the trustee an officers” certificate and an
opinion of counsel, each stating that such consolidation, merger, conveyance, transfer or lease and such
supplemental indenture complies with the foregoing provisions relating to such transaction.

Limitation on Liens

Nothing contained in the indenture restricts or prevents CODELCO or any Restricted Subsidiary (as
defined below) from incurring any additional indebtedness; provided that neither CODELCO nor any Restricted

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Subsidiary will (i) issue, assume or guarantee any indebtedness for money borrowed (“Debt”) if such Debt is
secured by a lien upon, or (ii) directly or indirectly secure any outstanding Debt by a lien upon, any Principal
Property (as defined below) or upon any shares of stock of, or indebtedness of, any Restricted Subsidiary, now
owned or hereafter acquired, without effectively providing that the notes shall be secured equally and ratably with
such Debt, except that the foregoing restrictions shall not apply to (i) liens on any Principal Property acquired,
constructed or improved after the date of issuance of the notes to secure or provide for the payment of the purchase
price or cost of construction or improvements (including costs such as increased costs due to escalation, interest
during construction and similar costs) thereof incurred after the date of the issuance of the notes, or existing liens
on property acquired, provided such liens shall not apply to any property theretofore owned by CODELCO or any
Restricted Subsidiary other than theretofore unimproved real property, (ii) liens on any Principal Property or
shares of stock or indebtedness acquired from a corporation merged with or into CODELCO or a Restricted
Subsidiary, (11) liens to secure Debt of a Restricted Subsidiary to CODELCO or another Subsidiary, (iv) the sale
or other transfer of any interest in property of the character commonly referred to as a “production payment,”
(v) liens over any property at the time of acquisition of such property by CODELCO or any of its Restricted
Subsidiaries which lien was not (or is not) created in connection with such acquisition, (vi) liens in existence on
the date of the offering of the notes, (vii) liens on deposits to secure, or any lien otherwise securing, the
performance of bids, statutory obligations, surety bonds, appeal bonds, performance bonds and other obligations of
a like nature incurred in the ordinary course of business, (viii) liens created on any property to secure Debt
incurred in connection with the financing of such property, the repayment of which Debt is to be made from the
revenues arising out of, or other proceeds of realization from, such property, with recourse to those revenues and
proceeds and other property used in connection with, or forming the subject matter of, such property, but without
recourse to any other property of CODELCO or any Restricted Subsidiary and (ix) any extension, renewal or
replacement (or successive extensions, renewals or replacements), in whole or in part, of any lien referred to in the
foregoing clauses (i) to (iii) or (v), (vi) and (viii), inclusive of any Debt secured thereby, provided that the
principal amount of Debt so secured thereby shall not exceed the principal amount of Debt so secured at the time
of such extension, renewal or replacement and that such extension, renewal or replacement lien shall be limited to
all or part of the property which secured the lien extended, renewed or replaced (plus improvements on or
additions to such property). Notwithstanding the foregoing, CODELCO and one or more Restricted Subsidiaries
may issue, assume or guarantee Debt secured by liens which would otherwise be subject to the foregoing
restrictions in an aggregate principal amount which, together with the aggregate outstanding principal amount of
all other Debt of CODELCO and its Restricted Subsidiaries that would otherwise be subject to the foregoing
restrictions (not including Debt permitted to be secured under clauses (i) through (ix) above) and the aggregate
value of the sale-and-lease-back transactions described under “—Limitation on Sale-and-Lease-Back
Transactions” below (other than sale-and-lease-back transactions the proceeds of which have been applied as
provided in clause (b) under “—Limitation on Sale-and-Lease-Back Transactions” below), does not at the time of
issuance, assumption or guarantee thereof exceed 20% of Consolidated Net Tangible Assets. “Consolidated Net
Tangible Assets” is defined as the total of all assets (including reevaluations thereof as a result of commercial
appraisals, price level restatement or otherwise) appearing on the consolidated balance sheet of CODELCO and its
Subsidiaries as of the then most recent date filed by CODELCO with the CMF, but excluding goodwill, trade
names, trademarks, patents, unamortized debt discount and all other like intangible assets (which term shall not be
construed to include such reevaluations), less the aggregate of the current liabilities of CODELCO and its
Subsidiaries appearing on such balance sheet. The term “Principal Property” means any mineral property,
concentrator, smelter, refinery or rod mill located within Chile, of CODELCO or any Subsidiary except any such
property, plant or facility which the Board of Directors by resolution declares is not of material importance to the
total business conducted by CODELCO and its Subsidiaries as an entity. The term “Subsidiary” means any
corporation more than 50% of the outstanding voting stock of which is owned, directly or indirectly, by
CODELCO and of which CODELCO has the power to direct the management. The term “Restricted Subsidiary”
means (i) any Subsidiary which owns, directly or indirectly, any Principal Property and (ii) any Subsidiary which
owns, directly or indirectly, any stock or debt of a Restricted Subsidiary.

Limitation on Sale-and-Lease-Back Transactions

The indenture provides that neither CODELCO nor any Restricted Subsidiary will enter into any
arrangement with any person (other than CODELCO or a Restricted Subsidiary), or to which any such person is a
party, providing for the leasing to CODELCO or a Restricted Subsidiary for a period of more than three years of
any property or assets which has been or is to be sold or transferred by CODELCO or such Restricted Subsidiary
to such person or to any person (other than CODELCO or a Restricted Subsidiary) to which funds have been or are

110
to be advanced by such person on the security of the leased property or assets unless either (1) CODELCO or such
Restricted Subsidiary would be entitled, pursuant to the provisions described under “—Limitation on Liens”
above, to incur Debt in a principal amount equal to or exceeding the value of such sale-and-lease-back transaction,
secured by a lien on the property or assets to be leased, without equally and ratably securing the notes, or
(ii) CODELCO, during or immediately after the expiration of six months after the effective date of such
transaction (whether made by CODELCO or a Restricted Subsidiary), applies to the voluntary retirement of
indebtedness of CODELCO (including the notes) maturing by its terms more than one year after the original
creation thereof (“Funded Debt”) an amount equal to the value of such transaction, less an amount equal to the
sum of (a) the principal amount of notes delivered, within six months after the effective date of such arrangement,
to the trustee for retirement and cancellation and (b) the principal amount of other Funded Debt voluntarily retired
by CODELCO within such six-month period, in each case excluding retirements of notes and other Funded Debt
as a result of conversions or pursuant to mandatory sinking fund or mandatory prepayment provisions or by
payment at maturity.

Periodic Reports

CODELCO will furnish, to the noteholders and to prospective purchasers of notes, upon request to the
trustee, any information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act so long as
the notes are not freely transferable under the Securities Act.

Events of Default

An Event of Default with respect to the notes is defined in the indenture as being any of the following
(each an “Event of Default”): (1) default for 30 days in payment of any interest on the notes; (ii) default in payment
of principal of the notes; (iii) default in the performance, or breach, of any covenant or warranty or obligation of
CODELCO in the indenture and continuance of such default or breach for a period of 60 days after written notice
is given to CODELCO by the trustee or to CODELCO and the trustee by the holders of at least 33 1/3% in
aggregate principal amount of the notes; (iv) default under any bond, debenture, note or other evidence of
indebtedness for money borrowed, or under any mortgage, indenture or instrument under which there may be
issued or by which there may be secured or evidenced any indebtedness for money borrowed by CODELCO or
any Subsidiary, whether such indebtedness now exists or shall hereafter be created, in an aggregate principal
amount exceeding U.S.$50 million (or its equivalent in any other currency or currencies) which default (x) shall
constitute the failure to pay any portion of the principal of such indebtedness when due and payable, whether at
maturity, upon redemption or acceleration or otherwise, or (y) shall have resulted in such indebtedness becoming
or being declared due and payable prior to the date on which it would otherwise become due and payable, in either
case, if such default shall continue for more than 30 Business Days and within such 30 Business Days the time for
payment of such amount has not been expressly extended (provided that if such default under such indenture or
instrument shall be remedied or cured by CODELCO or waived by the holders of such indebtedness, then the
event of default with respect to the notes shall be deemed likewise to have been remedied, cured or waived); and
(v) certain events of bankruptcy or insolvency of CODELCO or any Significant Subsidiary. “Significant
Subsidiary” is defined in the indenture as a Subsidiary, the total assets of which exceed 10% of the total assets of
CODELCO and its subsidiaries on a consolidated basis as of the end of the most recently completed year. The
trustee shall not be charged with knowledge of any Event of Default with respect to the notes unless a written
notice of such default or Event of Default shall have been given to an officer of the trustee who has direct
responsibility for the administration of the indenture and the notes by CODELCO or any holder of notes.

The indenture provides that (i) if an Event of Default (other than an Event of Default described in
clause (v) above) shall have occurred and be continuing with respect to the notes, either the trustee or the holders
of not less than 33!/3% of the total principal amount of the notes of such series then outstanding may declare the
principal of all such outstanding notes and the interest accrued thereon, if any, to be due and payable immediately
and (ii) if an Event of Default described in clause (v) above shall have occurred, the principal of all such
outstanding notes and the interest accrued thereon, if any, shall become and be immediately due and payable
without any declaration or other act on the part of the trustee or any holder of such notes. The indenture provides
that the notes owned by CODELCO or any of its affiliates shall be deemed not to be outstanding for certain
purposes, including declaring the acceleration of the maturity of the notes. Upon the satisfaction by CODELCO of
certain conditions, including (i) the payment of all fees and expenses of the trustee, (ii) CODELCO”s deposit with
the trustee of a sum sufficient to pay all outstanding amounts then due on the applicable notes (other than principal

111
due by virtue of the acceleration) together with interest on such amounts through the date of the deposit and (iii)
all Events of Default (other than non-payment of principal that became due by virtue of the acceleration upon the
event of default) have been cured or waived, the declaration described in clause (1) of this paragraph may be
annulled by the holders of a majority of the total principal amount of the applicable notes then outstanding. Past
defaults, other than non-payment of principal, interest and compliance with certain covenants, may be waived by
the holders of a majority of the total principal amount of the applicable notes outstanding.

The trustee must give to the holders of the notes notice of all uncured defaults known to it with respect to
the notes within 30 days after a Responsible Officer of the trustee has received written notification of such a
default (unless such default shall have been cured); provided, however, that, except in the case of default in the
payment of principal, interest or Additional Amounts, the trustee shall be protected in withholding such notice if it
in good faith determines that the withholding of such notice is in the interest of the holders of the notes.
“Responsible Officer” is defined in the indenture as any officer of the trustee with direct responsibility for the
administration of the indenture and, with respect to a particular corporate trust matter, any other officer to whom
such matter is referred because of his knowledge of and familiarity with the particular subject.

No holder of notes may institute any proceeding, judicial or otherwise, under the indenture unless (i) such
holder shall have given the trustee written notice of a continuing Event of Default with respect to the notes of that
series, (ii) the holders of not less than 33!/3% of the total principal amount of the notes of that series then
outstanding shall have made written request to the trustee to institute proceedings in respect of the Event of
Default, (111) such holder or holders shall have offered the trustee such reasonable indemnity as the trustee may
require, (iv) the trustee shall have failed to institute an action for 60 days thereafter and (v) no inconsistent
direction shall have been given to the trustee during such 60-day period by the holders of a majority of the total
principal amount of the notes of such series. Such limitations, however, do not apply to any suit instituted by a
holder of a note for enforcement of payment of the principal or interest on the notes on or after the respective
stated maturity expressed in such notes.

The indenture provides that, subject to the duty of the trustee during default to act with the required
standard of care, the trustee will be under no obligation to exercise any of its rights or powers under the indenture
at the request or direction of any holders of the notes, unless such holders shall have offered to the trustee
reasonable indemnity.

CODELCO is required to furnish to the trustee annually a statement as to the performance by CODELCO
of certain of its obligations under the indenture and as to any default in such performance.

Payment of Additional Amounts

All payments of principal and stated interest under the notes by CODELCO will be made without
deduction or withholding for or on account of any present or future taxes, assessments, duties or governmental
charges of whatever nature imposed or levied by or on behalf of Chile or any political subdivision or territory or
possession thereof or therein (the “Taxing Jurisdiction”) unless the withholding or deduction of such taxes,
assessments, duties or governmental charges is required by law or regulation or by the official interpretation
thereof. In that event, CODELCO will pay to each Holder of a note such additional amounts (“Additional
Amounts”) as may be necessary in order that each net payment on such note after such deduction or withholding
will not be less than the amount provided for in such note to be then due and payable; provided, however, that the
foregoing obligation to pay Additional Amounts will not apply to:

(1) any tax, assessment, duty or other governmental charge that would not have been so
deducted or withheld but for (i) the existence of any present or former connection between the Holder or
the beneficial owner of the note (or between a fiduciary, settlor, beneficiary, member or shareholder of, or
possessor of a power over, such Holder or beneficial owner, if such Holder or beneficial owner is an
estate, trust, partnership or corporation) and the Taxing Jurisdiction imposing such tax, assessment, duty
or other governmental charge (including, without limitation, such Holder or beneficial owner (or such
fiduciary, settler, beneficiary, member, shareholder or possessor) being or having been a citizen or
resident thereof or being or having been engaged in a trade or business or present therein or having, or
having had, a permanent establishment therein) other than the mere receipt of payments in respect of a
note or the holding or ownership of a note or beneficial interest therein; or (ii) the presentation of a note

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(where presentation is required) for payment on a date more than 30 days after the date on which such
payment became due and payable or the date on which payment thereof is duly provided for, whichever
occurs later;

(ii) any estate, inheritance, gift, sales, transfer, personal property, capital gains, excise or
similar tax, assessment, duty or other governmental charge;

(iii) any tax, assessment, duty or other governmental charge that is payable other than by
withholding from payments of (or in respect of) principal of, or any interest on, the notes;

(iv) any tax, assessment, duty or other governmental charge that would not have been imposed
but for the failure to comply with certification, information or other reporting requirements concerning
the nationality, residence or identity of the Holder or beneficial owner of the note, if compliance is
required by statute or by regulation of the Taxing Jurisdiction as a precondition to relief or exemption
from all or part of such tax, assessment, duty or other governmental charge, or to a reduction in the
applicable tax rate, and proper notice has been sent to the Holder or beneficial owner; or

(v) any combination of items (1), (ii), (111), and (iv) above.

Nor shall Additional Amounts be paid with respect to any payment of the principal of or any interest on
any note to any Holder or beneficial owner that is a fiduciary or partnership or other than the sole beneficial owner
of such note to the extent such payment would be required by the laws of the Taxing Jurisdiction to be included in
the income for tax purposes of a beneficiary or settlor with respect to such fiduciary or a member of such
partnership or a beneficial owner who would not have been entitled to such Additional Amounts had it been a
Holder of such note.

IfCODELCO pays Additional Amounts in respect of the Chilean withholding tax on payments of interest
or premium, if any, made by CODELCO in respect of the notes to a Foreign Holder (as defined in “Taxation”)
assessed at a rate of 4%, and a refund is provided with respect to such withholding tax, CODELCO shall have the
right to receive and be entitled to such funds from the relevant Taxing Jurisdiction.

Redemption

CODELCO will not be permitted to redeem the notes before their stated maturity, except as set forth
below. The notes will not be entitled to the benefit of any sinking fund —meaning that CODELCO will not deposit
money on a regular basis into any separate account to repay your notes. In addition, you will not be entitled to
require CODELCO to repurchase your notes from you before the stated maturity.

Optional Redemption

We may redeem on one or more occasions some or all of the notes before they mature.

The notes will be redeemable, in whole or in part, at our option at any time and from time to time, prior to
July 15, 2050 (six months prior to the scheduled maturity of the notes) (the “Par Call Date”) at a redemption price
equal to the greater of (1) 100% of the principal amount of the notes to be redeemed or (ii) the sum of the present
values of the remaining scheduled payments of principal and interest thereon as if redeemed on the Par Call Date
(exclusive of any interest accrued and unpaid to the date of redemption) discounted to the date of redemption on a
semi-annual basis (assuming a 360-day year consisting of twelve 30 day months) at the applicable Treasury Rate
plus 25 basis points, plus, in either case, accrued and unpaid interest, if any, to the date of redemption.

The notes will be redeemable, in whole or in part, at our option at any time from time to time,
commencing on the Par Call Date, at a redemption price equal to 100% of the principal amount of the notes to be
redeemed plus accrued and unpaid interest, if any, to the redemption date.

Notes called for redemption become due on the date fixed for redemption (the “Redemption Date”).
Notices of redemption will be mailed by first-class mail at least 30 but not more than 60 days before the

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Redemption Date to each holder of notes to be redeemed at its registered address. For so long as the notes are
listed on the Luxembourg Stock Exchange and the rules of the Euro MTF market so require, the Company will
cause notices of redemption to be announced through the Luxembourg Stock Exchange. The notice of redemption
for the notes will state the amount to be redeemed. On and after the Redemption Date, interest ceases to accrue on
any notes that are redeemed. If less than all the notes are redeemed at any time, the trustee will select notes by lot
or on a pro rata basis or by any other method that the trustee deems fair and appropriate.

For purposes of determining the optional redemption price, the following definitions are applicable:

“Comparable Treasury Issue” means the United States Treasury security or securities selected by an
Independent Investment Banker as having an actual or interpolated maturity that would be utilized, at the time of
selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of
a comparable maturity to the Par Call Date with respect to the notes.

“Comparable Treasury Price” means, with respect to any redemption date, (i) the average of five
Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and lowest Reference
Treasury Dealer Quotations, or (ii) if the Independent Investment Banker is unable to obtain at least five such
Reference Treasury Dealer Quotations, the average of all Reference Treasury Dealer Quotations obtained by the
Independent Investment Banker.

“Independent Investment Banker” means one of the Reference Treasury Dealers appointed by the Issuer
from time to time to act as the “Independent Investment Banker.”

“Reference Treasury Dealer” means BofA Securities, Inc., J.P. Morgan Securities LLC, Mizuho
Securities USA LLC, Scotia Capital (USA) Inc., or their respective affiliates or successors which are primary U.S.
Government securities dealers in New York City (“Primary Treasury Dealers”), and two other nationally
recognized investment banking firms that are Primary Treasury Dealers selected from time to time by the Issuer;
provided, however, that if any of the foregoing shall cease to be a Primary Treasury Dealer, the Issuer shall
substitute therefor another nationally recognized investment banking firm that is a Primary Treasury Dealer.

“Reference Treasury Dealer Quotation” means, with respect to each Reference Treasury Dealer and any
redemption date, the average, as determined by the Independent Investment Banker, of the bid and asked prices for
the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing
to the Independent Investment Banker by such Reference Treasury Dealer at 3:30 p.m., New York City time, on
the third business day preceding that redemption date.

“Treasury Rate” means, with respect to any redemption date, the rate per annum equal to the semi-annual
equivalent yield to maturity (computed as of the third business day immediately preceding that redemption date) of
the Comparable Treasury Issue, assuming a price for the Comparable Treasury Issue (expressed as a percentage of
its principal amount) equal to the Comparable Treasury Price for that redemption date.

Tax Redemption

The notes may be redeemed at the election of CODELCO, in whole, but not in part, by the giving of
notice as provided in “—Notices” below (which notice shall be irrevocable), at a price equal to the outstanding
principal amount thereof, together with any Additional Amounts and accrued and unpaid interest to the redemption
date, if, as a result of any change in, or amendment to, the laws (or any regulations or rulings promulgated
thereunder, including a holding by a court of competent jurisdiction) of the Taxing Jurisdiction, or any change in
the official application, administration or interpretation of such laws, regulations or rulings in such Taxing
Jurisdiction, CODELCO has or will become obligated to pay Additional Amounts on the applicable notes in
excess of the Additional Amounts that would be payable were payments of interest on the notes subject to 4%
withholding (“Excess Additional Amounts”), and if such change or amendment is announced or becomes effective
on or after the date of the agreement to purchase the notes and such obligation cannot be avoided by CODELCO
taking measures it considers reasonable and that are available to it (for this purpose, reasonable measures shall not
include any change in CODELCO*s or any successor”s jurisdiction of incorporation or organization or location of
its principal executive or registered office); provided, however, that no such notice of redemption shall be given

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earlier than 60 days prior to the earliest date on which CODELCO would be obligated to pay such Excess
Additional Amounts, were a payment in respect of the notes then due. Prior to the giving of notice of redemption
of such notes, CODELCO will deliver to the trustee an officers” certificate and a written opinion of recognized
Chilean counsel independent of CODELCO to the effect that all governmental approvals necessary for CODELCO
to effect such redemption, if any, have been or at the time of redemption will be obtained and in full force and
effect and that CODELCO is entitled to effect such a redemption, and setting forth in reasonable detail the
circumstances giving rise to such right of redemption. See “Taxation—Chilean Taxation.”

Notices

For so long as the notes are outstanding in global form, notices to be given to holders will be given to the
depositary, in accordance with its applicable procedures as in effect from time to time. If notes are issued in
individual definitive form, notice to holders of the notes will be given by mail to the addresses of such holders as
they appear in the security register. In addition, so long as the notes are listed on the Luxembourg Stock Exchange
and the rules of such exchange so require, notices will also be published in a leading newspaper having general
circulation in Luxembourg (which is expected to be Luxemburger Wort) or on the website of the Luxembourg
Stock Exchange (www.bourse.lu). Any such notice will be deemed to have been delivered on the date of first
publication.

Replacement of Notes

In case of mutilated, destroyed, lost or stolen notes, application for replacement thereof may be made to
the trustee or CODELCO. Any such note shall be replaced by the trustee in compliance with such procedures, and
on such terms as to evidence and indemnification, as the trustee or CODELCO may require and subject to any
applicable law or regulation. All such costs as may be incurred in connection with the replacement of any notes
shall be borne by the applicant. Mutilated notes must be surrendered before new ones will be issued.

Modification of the Indenture

CODELCO and the trustee may, without the consent of the holders of notes, amend, waive or supplement
the indenture or the notes for certain specified purposes, including among other things: (i) to evidence
CODELCOSs succession by another corporation, and the assumption by such party of CODELCO”s obligations;
(ii) to add to CODELCO”s covenants or surrender any of its rights or powers for the benefit of all or any series of
notes; (iii) to cure any ambiguity, defect or inconsistency in the indenture; (iv) to provide for the issuance of any
new series of securities, and/or add to the rights of any holders of any series of notes; (v) to provide for the
appointment of a successor trustee; (vi) to add any additional Events of Default for the benefit of any or all series;
(vii) to provide for the issuance of securities in bearer form; and (viii) to make any other change to the indenture as
shall not adversely affect the interests of any holder of the notes.

In addition, with certain exceptions, the indenture and the notes may be modified by CODELCO and the
trustee with the consent of the holders of a majority in aggregate principal amount of the notes of the series
affected thereby then outstanding, but no such modification may be made without the consent of the holder of each
outstanding note affected by the modification which would:

(1) change the maturity of any principal of, or any premium on, or any installment of
interest on, any note, or reduce the principal amount thereof or the rate of interest or any premium (or
Additional Amounts, if any) payable thereon, or change the method of computing the amount of principal
thereof or interest or premium (or Additional Amounts, if any) payable thereon on any date, or change
any place of payment where, or the coin or currency in which, the principal or interest (including
Additional Amounts) on any note are payable, or impair the right of holders to institute suit for the
enforcement of any such payment on or after the date when due;

(1) reduce the percentage in aggregate principal amount of outstanding notes of such series,
where the consent of holders is required for any such modification or for any waiver of compliance with
certain provisions of the indenture or certain defaults thereunder and their consequences provided for in
the indenture; or

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(111) modify provisions relating to waiver of certain defaults, waiver of certain covenants and
the provisions summarized in this paragraph, including provisions governing the amendment of the
indenture, except to increase any such percentage or to provide that certain other provisions of the
indenture cannot be modified or waived without the consent of the holder of each outstanding note
affected by the modification.

The indenture provides that the notes owned by CODELCO or any of its affiliates shall be deemed not to
be outstanding for, among other purposes, consent to any such modification.

Defeasance and Covenant Defeasance

CODELCO, at its option, at any time upon the satisfaction of certain conditions described below, may
elect to be discharged from its obligations with respect to the notes. In general, upon a defeasance, CODELCO
shall be deemed to have paid and discharged the entire indebtedness represented by the notes and to have satisfied
all of its obligations under the notes, except for: (1) the rights of holders of notes to receive, solely from the trust
fund established for such purposes, payments in respect of the principal of, and interest, and Additional Amounts,
if any, on the notes when such payments are due; (ii) certain provisions relating to ownership, registration and
transfer of the notes; (111) the covenant relating to the maintenance of an office or agency in New York City, and
(iv) certain provisions relating to the rights, powers, trusts, duties and immunities of the trustee.

In addition, CODELCO, at its option, at any time, upon the satisfaction of certain conditions described
below, may discharge its obligation to comply with the covenants specified above under “—Consolidation,
Merger, Conveyance, Sale or Lease,” “—Limitation on Liens” and “—Limitation on Sale-and-Lease-Back
Transactions.” In order to cause a defeasance or covenant defeasance with respect to the notes, CODELCO will be
required to (i) deposit funds or obligations issued by the United States in an amount sufficient to provide for the
timely payment of principal, interest and all other amounts due under the notes with the trustee, and (ii) satisfy
certain other conditions, including delivery to the trustee of an opinion of independent tax counsel of recognized
standing to the effect that beneficial owners of notes will not recognize income, gain or loss for U.S. federal
income tax purposes as a result of such deposit and defeasance and will be subject to U.S. federal income tax on
the same amount and in the same manner and at the same times as would have been the case if such deposit and
defeasance had not occurred. Such opinion of counsel in the case of defeasance must refer to and be based upon a
ruling of the Internal Revenue Service or a change in applicable U.S. federal income tax law occurring after the
date of the indenture.

Governing Law; Submission to Jurisdiction; Sovereign Immunity

The indenture provides that it and the notes will be governed by, and will be construed and interpreted in
accordance with, the law of the State of New York. The indenture provides that CODELCO will maintain at all
times during the life of the notes an office or agent in the Borough of Manhattan, The City of New York, upon
whom process may be served in any action arising out of or based on the notes which may be instituted in the
Supreme Court of the State of New York or the United States District Court for the Southern District of New
York, in either case in the Borough of Manhattan, The City of New York, by any holder of a note, and CODELCO
will expressly accept the jurisdiction of any such court.

To the extent that CODELCO may be entitled, in any jurisdiction in which judicial proceedings may at
any time be commenced with respect to the notes, to claim for itself or its revenues or assets any immunity from
suit, jurisdiction, attachment in aid or execution of a judgment or prior to a judgment, execution of a judgment or
any other legal process with respect to its obligations under the notes, and to the extent that in any such
jurisdiction there may be attributed to CODELCO such an immunity (whether or not claimed), CODELCO will
irrevocably agree not to claim and will irrevocably waive such immunity to the maximum extent permitted by law.

Article 226 of the Mining Code of Chile prohibits the attachment and judicial sale of a debtor’s mining
concessions and installations and other goods permanently dedicated to exploration or extraction of minerals
relating to those mining concessions, except with respect to mortgages. However, a debtor may consent to such
attachment and sale, provided that the consent is given in the same judicial proceeding in which the attachment
and sale is sought. The general waiver of immunity by CODELCO in the notes will not be effective with respect to
immunity under Article 226. In addition, pursuant to the Constitution, mining concessions corresponding to

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mining deposits exploited by CODELCO upon its creation in 1976 cannot be subject to attachment or to any act of
disposition by CODELCO.

Further Issues of Notes

Without the consent of the holders, CODELCO may create and issue additional notes with terms and
conditions that are the same (or the same except as to scheduled interest payments prior to the time of issue of the
additional notes) as the terms and conditions of the notes. CODELCO may consolidate the additional notes to form
a single series with the notes; provided, however, that unless such additional notes are issued under a separate
CUSIP number, such additional notes must be part of the same “issue” as the outstanding series of notes for U.S.
federal income tax purposes, issued pursuant to a “qualified reopening” as the outstanding series of notes for U.S.
federal income tax purposes, or issued with no more than a de minimis amount of original issue discount.

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TAXATION
General

The following is a summary of certain Chilean tax and U.S. federal income tax considerations (and
certain EU related tax consequences) relating to the purchase, ownership and disposition of notes. The summary
does not purport to be a comprehensive description of all the tax considerations that may be relevant to a decision
to purchase the notes, and, except to the extent certain EU-related tax consequences are described below, it does
not describe any tax consequences arising under the laws of any national, state, or local taxing jurisdiction other
than the United States and Chile.

This summary is based on the tax laws of Chile and the United States as in effect on the date of this
offering memorandum, as well as regulations, rulings and decisions of Chile and the United States available on or
before such date and now in effect. All of the foregoing is subject to change, which may apply retroactively and
could affect the continued validity of this summary.

Prospective purchasers of the notes should consult their own tax advisors as to the Chilean, United States
or other tax consequences of the purchase, ownership and disposition of the notes, taking into account the
application of the tax considerations discussed below to their particular situation, as well as the application of
state, local, foreign or other tax laws.

On February 4, 2010, Chile and the United States entered into a tax treaty (the “Treaty”), which has been
ratified by the Chilean Congress, but must be ratified by the competent authorities of the United States before it
can enter into effect, and which may apply to income generated in Chile or the United States by a resident of either
country. Investors should consult their own advisors regarding the application of the Treaty to their particular
circumstances and the date on which a particular Treaty provision will enter into effect.

Chilean Taxation

The following is a general summary of the material consequences under Chilean tax law, as currently in
effect, of an investment in the notes made by a “Foreign Holder.” For purposes of this summary, the term “Foreign
Holder” means (i) an individual not resident or domiciled in Chile or (ii) a legal entity that is not incorporated
under the laws of Chile, unless the notes are assigned to a branch or a permanent establishment of such entity in
Chile. For purposes of Chilean taxation, (a) an individual is a resident of Chile if such individual has remained in
Chile, uninterruptedly or not, for a period or periods that in total exceed 183 days within a twelve month period,
and (b) an individual is domiciled in Chile if such individual resides in Chile with the intention of remaining in
Chile (the intention will be determined according to the circumstances).

Under Chile”s Income Tax Law, payments of interest or premium, if any, made by CODELCO in respect
of the notes to a Foreign Holder will generally be subject to a Chilean withholding tax assessed at a rate of 4% (the
“Chilean Interest Withholding Tax”).

The Income Tax Law provides that a Foreign Holder is subject to income tax on Chilean source income.
Chilean source income is defined by the Income Tax Law as income arising from goods located in Chile or
activities performed in Chile, regardless of the domicile or residence of the taxpayer. The Income Tax Law
establishes that capital gains derived from the sale of bonds issued by a Chilean taxpayer in Chile are considered
Chilean source income. Hence, as the notes are not issued in Chile, capital gains arising from the sale or other
dispositions by a Foreign Holder of the notes will not be deemed as Chilean source income.

As described above, CODELCO has agreed, subject to specific exceptions and limitations, to pay to the
holders of notes Additional Amounts in respect of the Chilean Interest Withholding Tax in order that any interest
or premium the Foreign Holder receives, net of the Chilean Interest Withholding Tax, equals the amount which
would have been received by such Foreign Holder in the absence of such withholding. See “Description of
Notes —Payment of Additional Amounts.”

A Foreign Holder will not be liable for estate, gift, inheritance or similar taxes with respect to its holdings
unless the notes held by a Foreign Holder are either located in Chile at the time of such Foreign Holder”s death, or,

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if the notes are not located in Chile at the time of a Foreign Holder”s death, if such notes were purchased or
acquired with monies obtained from Chilean sources.

The issuance of the notes is subject to a stamp tax, which will be payable by CODELCO. If the stamp tax
is not paid when due, Chile”s Tax Law imposes penalties (fines, interests and readjustments), which will also be
payable by CODELCO. In addition, until such tax (and any penalty) is paid, Chilean courts would not enforce any
action brought with respect to the notes. We have agreed to pay promptly such tax when due.

United States Taxation

This summary of U.S. federal income tax considerations deals with U.S. Holders (as defined below) that
will hold CODELCO notes as capital assets and whose functional currency is the U.S. dollar. It does not purport to
be a comprehensive description of all of the tax considerations that may be relevant to a particular investor”s
decision to purchase notes and generally does not address the tax treatment of U.S. Holders that may be subject to
special tax rules, such as certain banks, tax-exempt entities, partnerships (or entities classified as partnerships for
U.S. federal income tax purposes) or partners therein, insurance companies, dealers in securities, nonresident alien
individuals present in the United States for 183 days or more during a taxable year, or persons that will hold notes
as part of an integrated investment (including a “straddle”) consisting of the notes and one or more other positions,
nor does it address the tax treatment of U.S. Holders that do not acquire notes as part of the initial distribution at
the notes” “issue price,” which will equal the first price to the public (not including bond houses, brokers or similar
persons or organizations acting in the capacity of underwriters, placement agents or wholesalers) at which a
substantial amount of the notes is sold for money.

As used in this section “—United States Taxation,” the term “U.S. Holder” means a beneficial owner of a
note that is a citizen or resident of the United States or a U.S. domestic corporation or that otherwise will be
subject to U.S. federal income taxation on a net income basis in respect of the notes.

This summary is based on the Internal Revenue Code of 1986, as amended to the date hereof,
administrative pronouncements, judicial decisions, and final, temporary and proposed Treasury Regulations,
changes to any of which subsequent to the date of this offering memorandum may affect the tax consequences
described herein. Investors should consult their own tax advisors in determining the tax consequences to them of
purchasing, owning, and disposing of the notes, including the application in their particular circumstances of the
U.S. federal income tax considerations discussed below, as well as the application of state, local, foreign, other tax
laws or the Medicare tax on net investment income and possible changes in tax laws.

U.S. Holders that use an accrual method of accounting for tax purposes (“accrual method holders”)
generally are required to include certain amounts in income no later than the time such amounts are reflected on
certain financial statements (the “book/tax conformity rule”). The application of the book/tax conformity rule thus
may require the accrual of income earlier than would be the case under the general tax rules described below. It is
not entirely clear to what types of income the book/tax conformity rule applies, or, in some cases, how the rule is
to be applied if it is applicable. However, proposed regulations generally would exclude, among other items,
original issue discount and market discount (in either case, whether or not de minimis) from the applicability of the
book/tax conformity rule. Although the proposed regulations generally will not be effective until taxable years
beginning after the date on which they are issued in final form, taxpayers generally are permitted to elect to rely on
their provisions currently. Accrual method holders should consult with their tax advisors regarding the potential
applicability of the book/tax conformity rule to their particular situation.

Special considerations may be relevant to prospective purchasers who are holders of Tender Notes who
participate in the Tender Offers. Such prospective purchasers should consult their own tax advisers concerning the
U.S. federal income tax consequences to them of the acquisition of Notes hereby and the sale of their Tender
Notes pursuant to the Tender Offers being characterized as an exchange.

Taxation of Interest and Additional Amounts. The gross amount of interest and Additional Amounts
(including any Chilean Interest Withholding Tax withheld from interest payments and any Additional Amounts in
respect thereof) will be taxable to a U.S. Holder as ordinary interest income in respect of the notes at the time it
accrues or is actually or constructively received in accordance with the holder”s method of accounting for U.S.

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federal income tax purposes. It is expected, and this discussion assumes, that the notes will be issued without
original issue discount (“OID”) for U.S. federal income tax purposes. In general, however, if the notes are issued
with OID at or above a de minimis threshold, a U.S. Holder will be required to include OID in gross income, as
ordinary income, under a “constant-yield-method” before the receipt of cash attributable to such income,
regardless of the U.S. holder”s regular method of accounting for U.S. federal income tax purposes.

Subject to generally applicable restrictions and conditions, Chilean Interest Withholding Tax withheld
from payments of interest on the notes, or from Additional Amounts, at the appropriate rate applicable to the U.S.
Holder will be treated as a foreign income tax eligible (i) for credit against a U.S. Holder”s U.S. federal income tax
liability, or (ii) at the election of such U.S. Holder, for deduction in computing such U.S. Holder”s taxable income
provided that the U.S. Holder does not elect to claim a foreign tax credit for any foreign income taxes paid or
accrued for the relevant taxable year. Interest and Additional Amounts will constitute income from sources
without the United States for foreign tax credit purposes. Such income generally will constitute “passive category
income” or, in the case of certain U.S. Holders, “general category income.”

The calculation of foreign tax credits and, in the case of a U.S. Holder that elects to deduct foreign taxes,
the availability of such deduction, involves the application of rules that depend on a U.S. Holder”s particular
circumstances. U.S. Holders should consult their own tax advisors regarding the availability of foreign tax credits
and the treatment of Additional Amounts.

Taxation of Dispositions. A U.S. Holder will generally recognize taxable gain or loss upon the sale,
exchange, redemption or other taxable disposition of the notes in an amount equal to the difference between the
amount realized upon such sale, exchange, redemption or other disposition (less any accrued interest and, in the
case of a redemption, any Additional Amounts with respect to accrued interest, which will be taxable in the
manner described above under “—Taxation of Interest and Additional Amounts”) and such U.S. Holder”s adjusted
tax basis in those notes. A U.S. Holder”s adjusted tax basis in a note will generally equal such U.S. Holder”s initial
investment in the note. Such gain or loss will be capital gain or loss, and will be long-term capital gain or loss if
the notes are held for more than one year. Certain non-corporate U.S. Holders (including individuals) may be
eligible for a preferential rate in respect of long-term capital gain. The deduction of capital losses is subject to
limitations.

Capital gain or loss recognized by a U.S. Holder generally will be U.S. source gain or loss. Consequently,
if any such gain would be subject to Chilean withholding tax, a U.S. Holder may not be able to credit the tax
against its U.S. federal income tax liability unless such credit can be applied (subject to applicable conditions and
limitations) against tax due on other income treated as derived from foreign sources. U.S. Holders should consult
their own tax advisors as to the foreign tax credit implications of a disposition of the notes.

Foreign Asset Reporting. Certain U.S. Holders that own “specified foreign financial assets” with an
aggregate value in excess of U.S.$50,000 on the last day of the taxable year or U.S.$75,000 at any time during the
taxable year are generally required to file an information statement along with their tax returns, currently on Form
8938, with respect to such assets. “Specified foreign financial assets” include any financial accounts held at a non-
U.S. financial institution, as well as securities issued by a non-U.S. issuer (which would include the notes) that are
not held in accounts maintained by financial institutions. Higher reporting thresholds apply to certain individuals
living abroad and to certain married individuals. Regulations extend this reporting requirement to certain entities
that are treated as formed or availed of to hold direct or indirect interests in specified foreign financial assets based
on certain objective criteria. U.S. Holders who fail to report the required information could be subject to
substantial penalties. In addition, the statute of limitations for assessment of tax would be suspended, in whole or
part. Prospective investors should consult their own tax advisors concerning the application of these rules to their
investment in the notes, including the application of the rules to their particular circumstances.

Information Reporting and Backup Withholding. Payments of interest and Additional Amounts on the
notes and sales or redemption proceeds that are made within the United States or through certain U.S.-related
financial intermediaries generally are subject to information reporting and to backup withholding unless
(i) the holder is an exempt recipient that, if required, establishes its exemption or (ii) in the case of backup
withholding, the holder provides a correct taxpayer identification number and certifies that it is not subject to
backup withholding.

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Any amounts withheld under the backup withholding rules from a payment to a holder will be refunded
(or credited against such holder”s U.S. federal income tax liability, if any), provided the required information is
properly furnished to the U.S. Internal Revenue Service on a timely basis.

The Proposed Financial Transaction Tax

The European Commission has published a proposal (the “Commission”s Proposal”) for a Directive for a
common financial transaction tax (“FTT”) in Belgium, Germany, Estonia, Greece, Spain, France, Italy, Austria,
Portugal, Slovenia and Slovakia (the “participating Member States”). However, Estonia has since stated that it will
not participate.

The Commission”s Proposal has very broad scope and could, if introduced in its current form, apply to
certain dealings in the notes in certain circumstances.

Under the Commission”s Proposal, the FTT could apply in certain circumstances to persons both within
and outside of the participating Member States. Generally, it would apply to certain dealings in the notes where at
least one party is a financial institution, and at least one party is established in a participating Member State.
A financial institution may be, or be deemed to be, “established” in a participating Member State in a broad range
of circumstances, including (i) by transacting with a person established in a participating Member State or
(ii) where the financial instrument which is subject to the dealings is issued in a participating Member State.

The FTT remains subject to negotiation between the participating Member States and the legality of the
proposal is uncertain. It may therefore be altered prior to any implementation, the timing of which remains
unclear. Additional EU Member States may decide to participate and/or certain of the participating Member States
may decide to withdraw.

Prospective holders of the notes are advised to seek their own professional advice in relation to the FTT.

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PLAN OF DISTRIBUTION

Subject to the terms and conditions of the purchase agreement among CODELCO, BofA Securities, Inc.,
J.P. Morgan Securities LLC, Mizuho Securities USA LLC and Scotia Capital (USA) Inc., the initial purchasers
have severally agreed to purchase from the Company the following respective principal amounts of notes listed
opposite their name below at the initial offering prices set forth on the cover page of this offering memorandum,
less commissions:

Initial Purchasers Principal Amount of Notes

U.S.$125,000,000
. U.S.$125,000,000

BofA Securities, Inc
J.P. Morgan Securities LLC Qe
Mizuho Securities USA LLC. …. U’.S.$125,000,000
Scotia Capital (USA) Inc. . U,S.$125,000,000

DA iii U-S-$500,000,000

The purchase agreement provides that the obligations of the several initial purchasers to purchase the
notes offered hereby are subject to certain conditions precedent and that the initial purchasers will purchase all of
the notes offered by this offering memorandum if any of these notes are purchased. The initial purchasers may use
any of their affiliates to offer and sell any of the notes.

After the initial offering, the initial purchasers may change the offering price and other selling terms.

CODELCO has agreed to indemnify the initial purchasers against certain liabilities, including liabilities
under the Securities Act, and to contribute to payments the initial purchasers may be required to make in respect of
any of these liabilities.

The notes have not been registered under the Securities Act. Each initial purchaser has agreed that it will
offer or sell the notes only (1) in the United States to qualified institutional buyers in reliance on Rule 144A under
the Securities Act or (1i) in offshore transactions in reliance on Regulation S under the Securities Act. The notes
being offered and sold pursuant to Regulation S may not be offered, sold or delivered in the United States or to, or
for the account or benefit of, any U.S. person, unless the notes are registered under the Securities Act or an
exemption from, the registration requirements thereof is available. Resales of the notes are restricted as described
under “Transfer Restrictions.”

Until forty (40) days after the later of the commencement of the offering and the closing date, any offer or
sale of notes within the United States by a broker-dealer (whether or not participating in this offering) may violate
the registration requirements of the Securities Act, unless such offer or sale is made pursuant to Rule 144A under
the Securities Act or another available exemption from the registration requirements thereof. Terms used above
have the meanings given to them by Regulation S and Rule 144A under the Securities Act.

CODELCO has agreed, that for a period of 30 days from the date of the purchase agreement, CODELCO
will not, without prior consent of the initial purchasers, offer, sell or contract to sell, or otherwise dispose of (or
enter into any transaction which is designed to, or might reasonably be expected to, result in the disposition
(whether by actual disposition or effective economic disposition due to cash settlement or otherwise) by
CODELCO or any affiliate of CODELCO or any person in privity with CODELCO or any of its affiliates),
directly or indirectly, or announce any public or broadly marketed offering of, any U.S. dollar-denominated debt
securities issued or guaranteed by CODELCO in the international capital markets (other than the notes).

The notes are a new issue of securities without an established trading market. We intend to apply to list
the notes on the Official List of the Luxembourg Stock Exchange; however, the notes have not yet been listed. The
notes are expected to trade on the Euro MTF market of the Luxembourg Stock Exchange. See “General
Information—Listing.” The initial purchasers may make a market in the notes after completion of the offering, but
will not be obligated to do so and may discontinue any market-making activities at any time without notice. No
assurance can be given as to the liquidity of the trading market for the notes or that an active market for the notes

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will develop. If an active public trading market for the notes does not develop, the market price and liquidity of the
notes may be adversely affected. If the notes are traded, they may trade at a discount from their initial offering
price, depending on prevailing interest rates, the market for similar securities, our operating performance and
financial condition, general economic conditions and other factors.

In connection with the offering of the notes, the initial purchasers may engage in overallotment,
stabilizing transactions and syndicate covering transactions. Overallotment involves sales in excess of the offering
size, which creates a short position for the initial purchasers. Stabilizing transactions involve bids to purchase the
notes in the open market for the purpose of pegging, fixing or maintaining the price of the notes. Syndicate
covering transactions involve purchases of the notes in the open market after the distribution has been completed
in order to cover short positions. Stabilizing transactions and syndicate covering transactions may cause the price
of the notes to be higher than it would otherwise be in the absence of those transactions. If the initial purchasers
engage in stabilizing or syndicate covering transactions, they may discontinue them at any time without notice.

The initial purchasers and their affiliates have performed and may in the future perform certain
commercial banking, investment banking or advisory services for us from time to time for which they have
received customary fees and expenses. The initial purchasers may, from time to time, continue to engage in
transactions with and perform services for us in the ordinary course of their business. Certain affiliates of Scotia
Capital (USA) Inc. are lenders to us under various credit facilities currently totaling U.S.$601 million as of
September 30, 2020. The initial purchasers are acting as dealer managers in the Tender Offers and may receive
compensation for any Tender Notes tendered.

In addition, in the ordinary course of their business activities, the initial purchasers and their affiliates
may make or hold a broad array of investments and actively trade debt and equity securities (or related derivative
securities) and financial instruments (including bank loans) for their own account and for the accounts of their
customers. Such investments and securities activities may involve securities and/or instruments of ours or our
affiliates. Certain of the initial purchasers or their affiliates that have a lending relationship with us routinely
hedge, and certain other of those initial purchasers or their affiliates that have a lending relationship with us may
hedge, their credit exposure to us consistent with their customary risk management policies. Typically, such initial
purchasers and their affiliates would hedge such exposure by entering into transactions which consist of either the
purchase of credit default swaps or the creation of short positions in our securities, including potentially the notes
offered hereby. Any such short positions could adversely affect future trading prices of the notes offered hereby.
The initial purchasers and their affiliates may also make investment recommendations and/or publish or express
independent research views in respect of such securities or financial instruments and may hold, or recommend to
customer that they acquire, long and/or short positions in such securities and instruments.

Delivery of the notes is expected on or about December 14, 2020 which will be the fifth business day
following the date of pricing of the notes (this settlement cycle being referred to as “T+5”). Under Rule 15c6-1 of
the Exchange Act, trades in the secondary market generally are required to settle in two business days, unless the
parties to any such trade expressly agree otherwise. Accordingly, purchasers who wish to trade notes prior to the
delivery of the notes will be required, by virtue of the fact that the notes initially will settle in T+5, to specify an
alternate settlement cycle at the time of any such trade to prevent a failed settlement. Purchasers of the notes who
wish to trade notes prior to their date of delivery hereunder should consult their own advisor.

Notice to Prospective Investors in the European Economic Area (“EEA”) and the United Kingdom

The notes are not intended to be offered, sold or otherwise made available to and will not be offered, sold
or otherwise made available to any retail investor in the EEA or in the UK. For these purposes:

a retail investor means a person who is one (or more) of:

(i) a retail client as defined in point (11) of Article 4(1) of Directive (EU) 2014/65 (as amended,
“MiFID IP”); or

(ii) a customer within the meaning of Directive (EU) 2016/97 (as amended, the “Insurance
Distribution Directive”), where that customer would not qualify as a professional client as
defined in point (10) of Article 4(1) of MiFID IL.

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Consequently, no key information document required by Regulation (EU) No 1286/2014 (as amended,
the “PRIIPs Regulation”) for offering or selling the notes or otherwise making them available to retail investors in
the EEA or in the UK, has been prepared and therefore offering or selling the notes or otherwise making them
available to any retail investor in the EEA or in the UK may be unlawful under the PRIIPs Regulation.

Notice to Prospective Investors in Canada

The notes may be sold only to purchasers purchasing, or deemed to be purchasing, as principal that are
accredited investors, as defined in National Instrument 45-106 Prospectus Exemptions or subsection 73.3(1) of the
Securities Act (Ontario), and are permitted clients, as defined in National Instrument 31-103 Registration
Requirements, Exemptions and Ongoing Registrant Obligations. Any resale of the notes must be made in
accordance with an exemption from, or in a transaction not subject to, the prospectus requirements of applicable
securities laws.

Securities legislation in certain provinces or territories of Canada may provide a purchaser with remedies
for rescission or damages if this offering memorandum (including any amendment thereto) contains a
misrepresentation, provided that the remedies for rescission or damages are exercised by the purchaser within the
time limit prescribed by the securities legislation of the purchaser”s province or territory. The purchaser should
refer to any applicable provisions of the securities legislation of the purchaser”s province or territory for particulars
of these rights or consult with a legal advisor.

Pursuant to section 3A.3 of National Instrument 33-105 Underwriting Conflicts (“NI 33-105”), the initial
purchasers are not required to comply with the disclosure requirements of NI 33-105 regarding underwriter
conflicts of interest in connection with this offering.

Notice to Prospective Investors in Hong Kong

The notes may not be offered or sold in Hong Kong by means of any document other than (a) to
“professional investors” as defined in the Securities and Futures Ordinance (Cap. 571) of Hong Kong (the “SFO”)
and any rules made under the SFO Ordinance; or (b) in other circumstances which do not result in the document
being a “prospectus” as defined in the Companies (Winding Up and Miscellaneous Provisions) Ordinance
(Cap. 32) of Hong Kong or which do not constitute an offer to the public within the meaning of that ordinance;
and no advertisement, invitation or document relating to the notes may be issued or may be in the possession of
any person for the purpose of issue (in each case whether in Hong Kong or elsewhere), which is directed at, or the
contents of which are likely to be accessed or read by, the public in Hong Kong (except if permitted to do so under
the securities laws of Hong Kong) other than with respect to the notes which are or are intended to be disposed of
only to persons outside Hong Kong or only to “professional investors” as defined in the SFO and any rules made
under that ordinance.

Notice to Prospective Investors in Italy

The offer of the notes has not been registered with the Commissione Nazionale per le Societá e la Borsa
(Italian Securities and Exchange Commission, or the “CONSOB”) pursuant to Italian securities legislation and,
accordingly, the notes may not be offered, sold or distributed to the public in the Republic of Italy (“Italy”) nor
may copies of this offering memorandum or of any other document relating to the notes be distributed in Italy,
except:

(1) to investitori qualificati (qualified investors), as defined in Article 2, paragraph (e) of the
Prospectus Regulation as implemented by Article 34-ter of CONSOB Regulation N* 11971 of
May 14, 1999, as amended from time to time, (the “Issuers Regulation”); or

(1) in any other circumstances where an express exemption from compliance with the restrictions on
offers to the public applies, as provided under Article 100 of the Italian Legislative Decree N* 58
of February 24, 1998, as amended from time to time, (the “Financial Services Act”) and Article
34-ter of the Issuers Regulation.

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Moreover, and subject to the foregoing, any offer, sale or delivery of the notes or distribution of copies of this
offering memorandum or any other document relating to the notes in Italy under (i) or (11) above must be:

(1) made by an investment firm, bank or financial intermediary permitted to conduct such activities
in Italy in accordance with the Financial Services Act, CONSOB Regulation N* 16190 of
29 October 2007, as amended from time to time, and Legislative Decree N* 385 of
September 1, 1993, as amended from time to time (the “Banking Act”);

(1) in compliance with Article 129 of the Banking Act and the implementing guidelines of the Bank
of Italy, as amended from time to time, pursuant to which the Bank of Italy may request
information on the issue or the offer of securities in Italy; and

(111) in compliance with any other applicable laws and regulations or requirement imposed by
the Bank of Italy, CONSOB or other Italian authority.

Any investor purchasing the notes in this offering is solely responsible for ensuring that any offer or resale of the
notes it purchased in the offering occurs in compliance with applicable Italian laws and regulations.

Notice to Prospective Investors in Japan

The notes have not been and will not be registered under the Financial Instruments and Exchange Act,
and the notes have not been offered or sold and will not be offered or sold, directly or indirectly, in Japan or to, or
for the benefit of, any resident of Japan (which term as used herein means any person resident in Japan, including
any corporation or other entity organized under the laws of Japan), or to others for re-offering or resale, directly or
indirectly, in Japan or to, or for the benefit of, a resident of Japan, except as pursuant to an exemption from the
registration requirements of, and otherwise in compliance with, the Financial Instruments and Exchange Act and
any other applicable laws, regulations and ministerial guidelines of Japan.

Notice to Prospective Investors in Singapore

This offering memorandum has not been registered as a prospectus with the Monetary Authority of
Singapore. Accordingly, this offering memorandum or any other document or material in connection with the offer
or sale, or invitation for subscription or purchase, of the notes may not be circulated or distributed, nor may the
notes be offered or sold, or be made the subject of an invitation for subscription or purchase, of such notes,
whether directly or indirectly, to persons in Singapore other than (i) to an institutional investor under Section 274
of the Securities and Futures Act, Chapter 289 of Singapore (the “SFA”, (ii) to a relevant person pursuant to
Section 275(1), or any person pursuant to Section 275(1A), and in accordance with the conditions specified in
Section 275, of the SFA, or (iii) otherwise pursuant to, and in accordance with the conditions of, any other
applicable provision of the SFA.

Where the notes are subscribed or purchased under Section 275 of the SFA by a relevant person which is:

(1) a corporation (which is not an accredited investor (as defined in Section 4A of the SFA)) the sole
business of which is to hold investments and the entire share capital of which is owned by one or
more individuals, each of whom is an accredited investor; or

(1) a trust (where the trustee is not an accredited investor) whose sole purpose is to hold investments
and each beneficiary of the trust is an individual who is an accredited investor,

securities (as defined in Section 239(1) of the SFA) of that corporation or the beneficiaries” rights and interest
(howsoever described) in that trust shall not be transferred within six months after that corporation or that trust has
acquired the notes pursuant to an offer made under Section 275 of the SFA, except:

(1) to an institutional investor under Section 274 of the SFA or to a relevant person (as defined in

Section 275(2) of the SFA), or to any person arising from an offer referred to in Section
275(1A), or Section 276(4)(1(B) of the SFA;

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(1) where no consideration is or will be given for the transfer;
(111) where the transfer is by operation of law;
(iv) as specified in Section 276(7) of the SFA; or

(v) as specified in Regulation 32 of the Securities and Futures (Offers of Investments) (Shares and
Debentures) Regulations 2005 of Singapore.

Notification under Section 309(B)(1)(c) of the SFA. The Company has determined that the Securities are
(A) prescribed capital markets products (as defined in the Securities and Futures (Capital Markets Products)
Regulations 2018) and (B) Excluded Investment Products (as defined in MAS Notice SFA 04-N12: Notice on the
Sale of Investment Products and MAS Notice FAA-N16: Notice on Recommendations on Investment Products).

Notice to Prospective Investors in Switzerland

This offering memorandum is not intended to constitute an offer or solicitation to purchase or invest in
the notes described herein. The notes may not be publicly offered, sold or advertised, directly or indirectly, in, into
or from Switzerland and will not be listed on the SIX Swiss Exchange or on any other exchange or regulated
trading facility in Switzerland. Neither this offering memorandum nor any other offering or marketing material
relating to the notes constitutes a prospectus as such term is understood pursuant to article 652a or article 1156 of
the Swiss Code of Obligations, and neither this offering memorandum nor any other offering or marketing
material relating to the notes may be publicly distributed or otherwise made publicly available in Switzerland.

Notice to Prospective Investors in Chile

The notes may not be offered or sold in Chile, directly or indirectly, by means of a “Public Offer” (as
defined under Law 18,045 and regulations from the CMF). Chilean institutional investors (such as banks, pension
funds and insurance companies) are required to comply with specific restrictions relating to the purchase of the
notes. Pursuant to Chilean law, a public offering of securities is an offering that is addressed to the general public
or to certain specific categories or groups thereof. Considering that the definition of public offering is quite broad,
even an offering addressed to a small group of investors may be considered to be addressed to a certain specific
category or group of the public and therefore be considered public under applicable law. On June 27, 2012, the
CMF issued Norma de Carácter General N* 336 (General Rule N* 336, hereinafter “NCG 336”), which is
intended to govern the private offering of securities in Chile. NCG 336 provides that the offering of securities that
meet the conditions described therein shall not be considered public offerings in Chile and shall be exempted from
complying with the general rules applicable to public offerings.

Notice to Prospective Investors in China

The notes are not being offered or sold and may not be offered or sold, directly or indirectly, in the People”s
Republic of China (the “PRC”) (for such purposes, not including the Hong Kong and Macau Special
Administrative Regions or Taiwan), except as permitted by the securities laws of the PRC.

Notice to Prospective Investors in the Dubai International Financial Centre

This offering memorandum relates to an Exempt Offer in accordance with the Markets Rules 2012 of the
Dubai Financial Services Authority (“DFSA”). This offering memorandum is intended for distribution only to
persons of a type specified in the Markets Rules 2012 of the DFSA. It must not be delivered to, or relied on by,
any other person. The DFSA has no responsibility for reviewing or verifying any documents in connection with
Exempt Offers. The DFSA has not approved this offering memorandum nor taken steps to verify the information
set forth herein and has no responsibility for this offering memorandum. The notes to which this offering
memorandum relates may be illiquid and/or subject to restrictions on their resale. Prospective purchasers of the
notes offered should conduct their own due diligence on the notes. If you do not understand the contents of this
offering memorandum, you should consult an authorized financial advisor.

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Notice to Prospective Investors in Taiwan

The notes have not been and will not be registered with the Financial Supervisory Commission of Taiwan
pursuant to relevant securities laws and regulations and the notes may not be sold, issued or offered within Taiwan
through a public offering or in a circumstance which constitutes an offer within the meaning of the Securities and
Exchange Act of Taiwan requiring registration or approval of the Financial Supervisory Commission of Taiwan.
No person or entity in Taiwan has been authorized to offer, sell, give advice regarding or otherwise intermediate
the offering and sale of the notes in Taiwan.

Notice to Prospective Investors in the Republic of Korea

The notes have not been and will not be offered, delivered or sold directly or indirectly in Korea or to any
resident of Korea except as otherwise permitted under applicable Korean laws and regulations.

127
TRANSFER RESTRICTIONS

The notes have not been and will not be registered under the Securities Act or with any securities
regulatory authority in any jurisdiction and may not be offered or sold in the United States or to, or for the account
or benefit of, U.S. persons except that notes may be offered or sold to (i) Qualified Institutional Buyers (“QIBs”»)
in reliance upon the exemption from the registration requirement of the Securities Act provided by Rule 144A and
(ii) persons other than U.S. persons as such term is defined in Regulation S under the Securities Act (“Foreign
Purchasers”) in offshore transactions in reliance upon Regulation S.

Each purchaser of the notes that is not a Foreign Purchaser will be deemed to:

(1) represent that it is purchasing the notes for its own account or an account with respect to which it
exercises sole investment discretion and that it and any such account is a QIB and is aware that
the sale to it is being made in reliance on Rule 144A;

(ii) acknowledge that the notes have not been and will not be registered under the Securities Act or
with any securities regulatory authority in any jurisdiction and may not be offered or sold within
the United States or to, or for the account or benefit of, U.S. persons except as set forth below;

(111) agree that if it should resell or otherwise transfer the securities, it will do so only pursuant to an
applicable exemption from, or in a transaction not subject to, the registration requirements of the
Securities Act, in each case in accordance with all applicable securities laws of the states of the
United States or any other applicable jurisdiction;

(iv) agree that it will deliver to each person to whom it transfers notes notice of any restrictions on
transfer of such notes;

(v) agree that it is not an “affiliate” (within the meaning of Rule 144 under the Securities Act) of the
Bank; and

(vi) acknowledge that CODELCO, the trustee, the initial purchasers and others will rely upon the
truth and accuracy of the foregoing acknowledgments, representations and agreements. If it is
acquiring any notes for the account of one or more QIBs, it represents that it has sole investment
discretion with respect to each such account and that it has full power to make the foregoing
acknowledgments, representations and agreements on behalf of each such account. If any of the
acknowledgements, representations or agreements it is deemed to have been made by the
purchase of notes is no longer accurate, it will promptly notify CODELCO and the initial
purchasers.

Each 144A Global Note will bear the following legend:

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF
1933, AS AMENDED (THE “SECURITIES ACT”) OR ANY STATE SECURITIES LAW. NEITHER
THIS NOTE NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE OFFERED, SOLD,
PLEDGED OR OTHERWISE TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR
THE ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH IN THE FOLLOWING
SENTENCE. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT AND
ANY ACCOUNT FOR WHICH IT IS ACTING IS A “QUALIFIED INSTITUTIONAL BUYER” (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”)) AND THAT IT
EXERCISES SOLE INVESTMENT DISCRETION WITH RESPECT TO EACH SUCH ACCOUNT
OR (B) IT IS A NON-U.S. PERSON OUTSIDE THE UNITED STATES WITHIN THE MEANING OF
(OR AN ACCOUNT SATISFYING THE REQUIREMENTS OF PARAGRAPH (k)G)() OF RULE 902
UNDER) REGULATION S UNDER THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT,
PRIOR TO THE EXPIRATION OF THE HOLDING PERIOD APPLICABLE TO SALES OF THE
NOTES EVIDENCED HEREBY UNDER RULE 144(d) UNDER THE SECURITIES ACT (OR ANY
SUCCESSOR PROVISION), OFFER, SELL, PLEDGE OR OTHERWISE TRANSFER SUCH NOTES

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EXCEPT IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF
THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND ONLY (A) TO THE
ISSUER OR A SUBSIDIARY THEREOF, (B) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT, (C) SO LONG AS THIS NOTE IS ELIGIBLE FOR
RESALE PURSUANT TO RULE 144A, TO A PERSON WHOM THE SELLER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A
PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE RESALE, PLEDGE OR
OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 1444, (D) IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH REGULATION S UNDER THE SECURITIES ACT OR
(E) PURSUANT TO AN EXEMPTION FROM REGISTRATION (IF APPLICABLE). PRIOR TO THE
REGISTRATION OF ANY TRANSFER IN ACCORDANCE WITH (E) ABOVE, THE COMPANY
RESERVES THE RIGHT TO REQUIRE THE DELIVERY OF SUCH LEGAL OPINIONS,
CERTIFICATIONS OR OTHER EVIDENCE AS MAY REASONABLY BE REQUIRED IN ORDER
TO DETERMINE THAT THE PROPOSED TRANSFER IS BEING MADE IN COMPLIANCE WITH
THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS. THIS NOTE IS SUBJECT
TO THE RESTRICTIONS ON TRANSFER SET FORTH IN THE INDENTURE REFERRED TO ON
THE REVERSE HEREOF. THIS LEGEND WILL BE REMOVED ONLY AT THE OPTION OF THE
ISSUER.

Each purchaser of notes that is a Foreign Purchaser will be deemed to:

(1) represent that it is purchasing the notes for its own account or an account for which it exercises
sole investment discretion and that it and any such account is a Foreign Purchaser that is outside
the United States and acknowledge that the notes have not been and will not be registered under
the Securities Act or with any securities regulatory authority in any jurisdiction and may not be
offered or sold within the United States or to, or for the account or benefit of, U.S. persons
except as set forth below; and

(ii) agree that if it should resell or otherwise transfer the notes prior to the expiration of a restricted
period (defined as 40 days after the later of the commencement of the offering and the closing
date with respect to the notes), it will do so only (aX(1) outside the United States in compliance
with Rule 904 under the Securities Act or (2) to a QIB in compliance with Rule 144A, and (b) in
accordance with all applicable securities laws of the states of the United States or any other
applicable jurisdiction.

Each Regulation S Global Note will bear the following legend:

THIS SECURITY HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE U.S.
SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR WITH ANY
SECURITIES REGULATORY AGENCY IN ANY JURISDICTION, AND, ACCORDINGLY, MAY
NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT
OR BENEFIT OF, U.S. PERSONS, EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OR IN A TRANSACTION NOT SUBJECT TO
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THIS SECURITY IS
SUBJECT TO THE RESTRICTIONS ON TRANSFER SET FORTH IN THE INDENTURE
REFERRED TO ON THE REVERSE HEREOF. PRIOR TO THE EXPIRATION OF A RESTRICTED
PERIOD ENDING ON JANUARY 23, 2021 OR SUCH LATER DATE AS THE COMPANY MAY
NOTIFY TO THE TRUSTEE, THIS SECURITY, OR ANY BENEFICIAL INTEREST HEREIN, MAY
NOT BE RESOLD OR OTHERWISE TRANSFERRED EXCEPT (A)J(1) OUTSIDE THE UNITED
STATES IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT OR (2) TO A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE
SECURITIES ACT IN COMPLIANCE WITH RULE 144A, AND (B) IN ACCORDANCE WITH ALL
APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED STATES OR ANY OTHER
APPLICABLE JURISDICTION.

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The transfer or exchange of a beneficial interest in a Regulation S Global Note for a beneficial interest in
a corresponding 144A Global Note prior to the expiration of the restricted period will be made only in accordance
with applicable procedures upon receipt by the trustee of a duly completed certificate from the transferor to the
effect that such transfer is being made in accordance with Rule 144A under the Securities Act. Such written
certification will no longer be required after the expiration of the restricted period. The transfer or exchange of a
beneficial interests in a Rule 144A Global Note for a corresponding beneficial interest in a Regulation S Global
Note, whether before or after the expiration of the restricted period, will be made only upon receipt by the trustee
of a written certification from the transferor to the effect that such transfer is being made in accordance with
Regulation S under the Securities Act.

For so long as the notes are listed on the Luxembourg Stock Exchange, if the notes are ever issued in
certificated form:

. Certificated Notes will be delivered by the trustee as described in this offering memorandum
and at the offices of the paying agent; and

. holders of notes in certificated form will be able to transfer or exchange their notes at the
offices of the transfer agent.

Any resale or other transfer, or attempted resale of other transfer, made other than in compliance with the
above stated restrictions shall not be recognized by us.

For further discussion of the requirements (including the presentation of transfer certificates) under the
indenture to effect exchanges or transfers of interests in Global Notes, see “Description of Notes—Registration,
Form and Delivery—Certain Book-Entry Procedures for the Global Notes.”

We have prepared this offering memorandum solely for use in connection with the offer and sale of the
notes outside the United States, for the private placement of the notes in the United States and for the listing on the
Luxembourg Stock Exchange. We and the initial purchasers reserve the right to reject any offer to purchase, in
whole or in part, for any reason, or to sell less than the amount of notes offered pursuant to Rule 144A under the
Securities Act. This offering memorandum does not constitute an offer to any person in the United States other
than any QIB under the Securities Act to whom an offer has been made directly by the initial purchasers or an
affiliate of the initial purchasers.

Each purchaser of notes must comply with all applicable laws and regulations in force in any jurisdiction
in which it purchases, offers or sells notes or possesses or distributes this offering memorandum or any part of it
and must obtain any consent, approval or permission required by it for the purchase, offer or sale by it of notes
under the laws and regulations in force in any jurisdiction to which it is subject or in which it makes such
purchases, offers or resales, and neither the Company nor the initial purchasers shall have any responsibility
therefor.

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VALIDITY OF THE NOTES

The validity of the notes will be passed upon for CODELCO by Cleary Gottlieb Steen $: Hamilton LLP,
New York, New York, United States counsel for CODELCO, and by Carey y Cía. Ltda., Chilean counsel to
CODELCO, and for the initial purchasers by Davis Polk £ Wardwell LLP, United States counsel for the initial
purchasers, and by Philippi, Prietocarrizosa, Ferrero DU $ Uría SpA, Chilean counsel for the initial purchasers.
Cleary Gottlieb Steen £ Hamilton LLP may rely without independent investigation as to all matters of Chilean
law on Carey y Cía. Ltda., and Davis Polk $: Wardwell LLP may rely without independent investigation as to all
matters of Chilean law on Philippi, Prietocarrizosa, Ferrero DU 4 Uría SpA.

131
INDEPENDENT AUDITORS

The financial statements of CODELCO and its subsidiaries as of and for the years ended December 31,
2019 and 2018 and as of and for the years ended December 31, 2018 and 2017, included in this offering
memorandum, have been audited by Deloitte Auditores y Consultores Ltda., independent auditors, as stated in
their reports appearing herein (which reports express unmodified opinions and include, respectively, an
explanatory paragraph referring to the convenience translation of the financial statements into English).

132
GLOSSARY OF CERTAIN MINING TERMS

Andesite: A fine-grained volcanic rock, usually dark grey in color, with an average composition of
50-60% sulphur dioxide.

Anode Copper: Blister copper that has undergone further refinement to remove impurities. In an anode furnace,
the blister copper is blown with air and a hydrocarbon redundant to upgrade its purity to approximately
99.5% copper. It is then cast into keystone-shaped slabs that are shipped to an electrolytic refinery.

Anodic Slime: A product with a high content of precious metals that settles on the bottom of an electrolytic cell in
the copper refinery during the production of copper cathodes. The product is called anode, or anodic, slime due to
its muddy appearance. Anode slimes have a high commercial value based on their precious metals content (silver,
gold, platinum and palladium).

Blister Copper: Copper that has been cast after passing through a converter. Blister copper is approximately
99.0% copper and takes its name from the “blisters” that form on the surface during cooling.

Breccia: A rock conglomerate made up of highly angular coarse fragments.

Calcopyrite: A combination of copper and iron sulfide with a metallic yellow-gold color, containing
34.7% copper, 30% iron and 26% sulfur.

Cathode: Copper produced by an electrochemical refining process that has been melted and cast into cakes,
billets, wire bars or rods usually weighing approximately 90kg.

Concentration: The process by which crushed and ground ore is separated into metal concentrates and reject
material through processes such as flotation. Concentrates are shipped to a smelter for further processing.

Concentrator: A plant where concentration takes place.
Converter: A plant that conducts a principal phase of the smelting process, blowing oxygen-enriched air through,
molten metal, causing oxidation and the removal of sulfur and other impurities. In the case of copper, the product

of this process is blister copper.

Copper Concentrate: A product of the concentrator usually containing 25% to 30% copper. It is the raw feed
material for smelting.

Copper Grade: The concentration of copper in a given volume of rock, usually expressed as a percentage.

Dacite: A fine-grained volcanic rock similar in composition to andesite but containing a greater abundance of
quartz crystals that are frequently visible to the naked eye.

Development: Activities related to the building of infrastructure and the stripping and opening of mineral
deposits, commencing when economically recoverable reserves can reasonably be estimated to exist and generally
continuing until commercial production begins.

Diorite: A dark, coarsely crystalline igneous rock, similar in composition to granite that is composed principally
of silica, alumina, calcium and iron.

Electrolytic Refining: Electrochemical refining of copper anodes. Copper anodes are placed between layers of
refined copper sheets in a tank through which an acid copper sulfate solution is circulated. A low voltage current is
introduced, causing the transfer of copper from the anodes to the pure copper sheets, and producing
99.98% copper cathodes. Impurities, often containing precious metals, settle to the bottom of the tank.

Electrowinning: The process of directly recovering copper from solution by the action of electric currents.

133
Exploration: Activities associated with ascertaining the existence, location, extent or quality of a mineral deposit.
Fine Copper: 99.99% pure copper obtained through metallurgical processes.

Flotation: A process of copper concentrate production in which mineral particles attach themselves to the bubbles
in an oily froth and rise to the surface, where they are skimmed off. This process is used primarily for the
concentration of sulfide ores.

Flux: A high grade silica, which reacts with iron oxides formed during smelting and converting stages to create a
molten slag.

Geological Resources (measured, indicated and inferred): Concentrations or occurrences of materials in such
form, quantity (tonnage and ore grade) and quality, based on specific geological evidence and knowledge, which
allows for the calculation of the amount, ore grade and quality of the material with some level of confidence.

Grade A Copper: Electrolytic copper, in the form of cathodes, that (i) is at least 99.99% pure, (ii) meets the
LMES’s highest standards for copper quality, and (iii) is named in the LME-approved list of brands of Grade A
copper.

Indicated Resources (geological or mineral resources): Resources about which CODELCO”s knowledge is
substantial but less extensive than its knowledge of measured resources.

Inferred Resources (geological or mineral resources): Resources about which CODELCO”s knowledge is only
indirect.

Intrusion: A geologic processes in which magmatic material flows to the earth”s surface through pre-existing
rocks.

Leached Capping: An abundant mass of iron oxide concentrated in the upper zones of a porphyry copper deposit.

Leaching: The process of extracting a soluble metallic compound from an ore by selectively dissolving it in a
suitable solvent.

Matte: A high density liquid that is produced during the concentrate fusion stage of the pyro-metallurgical
process.

Matte Sulfide: A high density liquid containing copper and iron sulfides that is produced of the concentrate fusion
stage of the pyro-metallurgical process.

Measured Resources (geological or mineral resources): Resources about which CODELCO”s knowledge is
both extensive and direct.

Milling: A treatment process in which ore is ground into a fine powder.
Mine: Mines are the source of mineral-bearing material found near the surface or deep in the ground.

Mineral Deposit: A mineralized underground body that has been probed by a sufficient number of closely-spaced
drill holes and/or underground sampling measurements to support an estimate of sufficient tonnage and ore grade
to warrant further exploration or development. Mineral deposits or mineralized materials do not qualify as
commercially minable ore reserves (i.e., proved reserves or probable reserves), as prescribed under standards of
the U.S. Bureau of Mines Circular 831 of 1980, until a final and comprehensive economic, technical, and legal
feasibility study based upon the test results has been concluded.

Mineral Resources (measured, indicated and inferred): Geological resources about which CODELCO has
achieved increased knowledge and which enable CODELCO to generate a long-term mining plan for the
exploitation of such resources.

134
Mineralization: A deposit of rock containing one or more minerals for which the economics of recovery have not
yet been established.

Molybdenum: A metallic element, grayish in color, that resembles chromium and tungsten in many properties,
and is used especially in strengthening and hardening steel.

Ore: A mineral or aggregate of minerals from which metal can be economically mined or extracted.
Ore Grade: The average amount of metal expressed as a percentage or in ounces per metric ton.
Ore Deposit: Category including all geological resources, mineral resources and ore reserves.

Ore Reserves: The economically mineable part of a mineral resource.

Ounces: Unit of weight. A troy ounce equals 31,103 grams or 1.097 avoirdupois ounces.
Outokumpu Flash Furnace: Pyro-metallurgical technology used to smelt copper concentrate.
Overburden: The alluvium and rock that must be removed in order to expose an ore deposit.

Oxide Ore: Metalliferous minerals altered by weathering, surface waters, and their conversion, partly or wholly,
into oxides, carbonates, or sulfates.

Pierce Smith Converter: Horizontal furnace to remove impurities from white metal by oxidation.
Porphyry: Rock with siliceous minerals and fine-medium grained size.
Porphyry-type Ore Body: Deposit of porphyric rocks with economic mineralization.

Probable Ore Reserves: Ore reserves about which CODELCO”s knowledge is substantial but less extensive than
its knowledge of proved ore reserves.

Proved Ore Reserves: Ore reserves about which CODELCO”s knowledge is both extensive and direct. Quantities
of proved ore reserves are computed from dimensions revealed in outcrops, trenches, workings or drill holes, and
grade and quality are computed from the results of detailed sampling. Sites for inspection, sampling and
measurement of proved ore reserves are spaced so closely together, and the geologic character of the ore is so well
defined, that its size, shape, depth and mineral content are well established.

Reclamation: The process of restoring mined land to a condition established by applicable law. Reclamation
standards vary widely, but usually address issues of ground and surface water, topsoil, final slope gradients,
overburden and revegetation.

Refining: The purification of crude metallic substances.

Reverberatory Furnace: A furnace with a shallow hearth and a ceiling that reflects flames toward the hearth or
radiates heat toward the surface of the charge.

Rod Mill: A large rotating cylinder in which metal rods are used for grinding ore.

Slag: A residue of the smelting process containing iron and other impurities, which the Company disposes of with
its other industrial solid waste.

Smelting: A pyro-metallurgical process in which metal is separated by fusion from those impurities with which it
may be chemically combined or physically mixed.

135
Solvent Extraction: A method of separating one or more substances from a chemical solution by treatment with a
suitable organic solvent.

Subvertical: Amount of waste material removed during mining per metric ton of ore extracted in a near-vertical
spatial orientation.

Sulfide Ore: Ore characterized by the inclusion of metal in the crystal structure of a sulfide mineral.

Tabular: Having a near-rectangular geometric configuration close to a rectangular shape.

Tailings: Finely ground rock from which valuable minerals have been extracted by concentration.

Teniente Converter: A horizontal rotary furnace into which matte, concentrates and flux are placed, and through
which oxygen-rich air is blown to provide sufficient heat to smelt the concentrates. Off-gases are captured and
transported to the acid plant.

Teniente Modified Converter: An advanced pyro-metallurgical technology used to smelt copper concentrate.

Ton: A unit of weight. One metric ton equals 2,204.6 pounds. One short ton equals 2,000 pounds. Unless
otherwise specified in this document, “tons” refers to metric tons.

Tourmaline: A dark-green hydrosilicate that exists in altered rock zones in some ore deposits.

136
GENERAL INFORMATION
Authorization

The Ministry of Finance of Chile authorized CODELCO to commence negotiations to issue bonds abroad
through Resolution N* 2741 dated November 26, 2020. The Ministry of Finance of Chile authorized the issuance
of the notes by Resolution N* 2796 dated December 4, 2020.

CODELCO”s Board of Directors authorized the issuance of the notes in its ordinary session of October
29, 2020 by means of Reserved Agreement N” 31/2020. CODELCO has obtained all other consents and
authorizations necessary under Chilean law for the issuance of the notes.

Litigation

CODELCO is not involved in any litigation or arbitration proceeding which is material in the context of
the issuance of the notes. CODELCO is not aware of any material litigation or arbitration proceeding that is
pending or threatened.

Clearing

CODELCO has applied to have the notes accepted into DTC”s book-entry settlement system. The notes
have been accepted for clearance through the clearing systems of Euroclear System and Clearstream Banking, S.A.
The securities codes for the notes are:

CUSIP Number ISIN Number Common Code
Rule 144A Global Note… 21987B BD9 US21987BBD91 227311053
Regulation S Global Note P3143N BM5 USP3143NBM58 227311070

Listing

We intend to apply to list the notes on the Official List of the Luxembourg Stock Exchange and for
trading on the Euro MTF market of the Luxembourg Stock Exchange in accordance with its rules and regulations.
The notes are not yet listed. If any European or national legislation is adopted and is implemented or takes effect in
Luxembourg in a manner that would impose requirements on us that CODELCO, in its discretion determines are
impracticable or unduly burdensome, CODELCO may de-list the notes. In these circumstances, there can be no
assurance that CODELCO would obtain an alternative admission to listing, trading and/or quotation for the notes
by another listing authority, exchange and/or system within or outside the EU. For information regarding the
notice requirements associated with any delisting decision, see “Description of Notes—Notices.”

CODELCO has initially appointed The Bank of New York Mellon SA/NV, Luxembourg Branch to serve
as its Luxembourg listing agent. You can contact the Luxembourg listing agent at the addresses listed on the inside
back cover of this offering memorandum. CODELCO will maintain a paying agent so long as the notes are listed
on the Luxembourg Stock Exchange. Any change in the paying agent will be communicated to the Luxembourg
Stock Exchange and through publication in a daily newspaper in Luxembourg.

As long as the notes are listed on the Luxembourg Stock Exchange, you may receive free of charge
copies of the following documents at the offices of the listing agent or the paying agent on any business day:

. this offering memorandum;
. the indenture attaching the forms of the notes;
. CODELCOSs statutory documents;

. English translations of the official letter authorizing the incurrence of indebtedness as issued
by the Ministry of Finance; and

137
. the most recent annual report, including the Consolidated Financial Statements, of
CODELCO.

Copies of the indenture may be physically inspected during usual business hours on any weekday
(excluding Saturday, Sundays and public holidays) at the offices of the trustee at 240 Greenwich Street, Floor 7
East, New York, New York 10286.

The notes have been issued in registered, book-entry form through the facilities of DTC, and will be
issued in certificated form only under the limited circumstances described in this offering memorandum.

Financial Condition

There has been no material adverse change in CODELCO”s financial condition and prospects since the
date of the last audited financial statements.

138
CORPORACION NACIONAL
DEL COBRE DE CHILE

Unaudited interim consolidated financial statements
As of September 30, 2020 and for the nine-month and
three-month periods ended September 30, 2020 and 2019
O

CODELCO

CODELCO – CHILE

Unaudited interim consolidated financial statements as of September 30, 2020 and
for the nine-month and three-month periods ended September 30, 2020 and 2019

(Translation into English of the consolidated financial statements originally issued
in Spanish — see Note 1.2)
TABLE OF CONTENTS
CONSOLIDATED FINANCIAL STATEMENTS
(Translation into English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION ……ccoccocmoscoscoscoscianiisiscrscississes 5
INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION ……ccoccocmoscoscoscoscianiisiscrscississes 6
INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) – BY FUNCTION ……. 7
INTERIM CONSOLIDATED STATEMENTS OF OTHER COMPREHENSIVE INCOME (LOSS)………………w:.. 8
INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS – DIRECT METHOD…….c.uccucocioocosnoosioscoosos 9

INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
L GENERAL INFORMATION
1. Corporate Information ………………. 11
2. Basis of Presentation of the Consol
ll. SIGNIFICANT ACCOUNTING POLICIES
1. Significant Judgments and Key Estimates …
2. Significant accounting policies
3. New standards and interpretations adopted by the Corporation
4. New accounting pronouncements

lll… EXPLANATORY NOTES ………..

1. Cash and cash equivalents…. 40
2. Trade and other receivables…………… 41
3. Balance and transactions with related parties .. 43
4. Inventori8S ….ooononcccononcnnncnnnnonon ones 47
5. Income taxes and deferred taxes…. 48
6. Current and non-current tax assets and liabilities. 51
7. Property, Plant and Equipment ………. 51
8. LeasesS cnoccoccononcnnnoncnnncorncnconaronannos 56
9. Investments accounted for using the equity method. 57
10. SubsidiariesS …….ococonnmmmmmmmmmms$m. 63
11. Current and non-current financial assets 63
12. Other financial liabilities …………………… 64
13. Fair Value of financial assets and liabilities . 74
14. Fair value hierarchy………occonoomommmo. 75
15. Trade and other payables .. 75
16. Other provisions ……. 76
17. Employee benefits 77
18. Equity ………. 80
19. Revenue……. 82
20. Expenses by Natul6…..o.ococmmcomonm.os.. 83
21. Other income and expenses by function. 83
22. Finance COSÉS …ooocconocconancncnnonononos 84
23. Operating segments………….. 84
24. Foreign exchange differences 92
25. Statement of cash flowS ……………. 92
26. Financial risk management, objectives and policies .

27. Derivatives contracts
28.
29.
30.
31.
32.
33.

Contingencies and restrictions.
Guarantees…
Balances in foreign currency
Sanctions
Environmental Expenditures
Subsequent events

CORPORACION NACIONAL DEL COBRE DE CHILE
INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
As of September 30, 2020 (Unaudited) and December 31, 2019
(In thousands of US dollars – ThUS$)
(Translation into English of the consolidated financial statements originally issued in Spanish – see Note 1.2)

Notes 9/30/2020 12/31/2019
No
Assets
Current Assets
Cash and cash equivalents 1 3,453,889 1,303,105
Other current financial assets 11 203,857 172,951
Other current non-financial assets 42,206 20,969
Trade and other currentreceivables 2 2,333,987 2,588,268
Accounts receivable from related parties, current 3 21,523 20,874
Inventories 4 2,028,282 1,921,135
Current tax assets 6 55,039 22,719
[Total current assets 8,138,783 6,050,021 |
Non-current assets
Other non-current financial assets 11 66,869 91,800
Other non-currentnon-financial assets 3,237 4,561
Non-currentreceivables 2 91,160 98,544
Accounts receivable from related parties, non-current 3 13,194 15,594
Non-current inventories 4 568,836 585,681
Investments accounted for using equity method 9 3,470,552 3,483,523
Intangible assets other than goodwill 46,104 47,837
Property, plantand equipment 7 29,390,808 29,268,012
Investment property 981 981
Rightofuse assets 8 396,775 432,152
Non-currenttax assets 6 173,013 222,169
Deferred tax assets 5 46,157 43,736
Total non-current assets 34,267,686 34,294,590
Total Assets 42,406,469 40,344,611

The accompanying notes are an integral part of these interim consolidated financial statements.
CORPORACION NACIONAL DEL COBRE DE CHILE
INTERIM CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
As of September 30, 2020 (Unaudited) and December 31, 2019
(In thousands of US dollars – TRUS$)
(Translation into English of the consolidated financial statements originally issued in Spanish – see Note 1.2)

Notes 9/30/2020 12/31/2019
No
Liabilities and Equity
Liabilities
Current liabilities

Other current financial liabiliies 12 948,687 1,250,590
Current lease liabilities 8 126,236 127,761
Trade and other current payables 15 1,115,272 1,420,915
Accounts payable to related parties, current 3 159,387 137,234
Other current provisions 16 506,300 502,172
Current tax liabilities 6 4,139 13,857
Current provisions for employee benefits 17 324,238 435,565
Other current non-financial liabilities 33,534 34,863
[Total current liabilities 3,217,793 3,922,957 |
Non-current liabilities

Other non-current financial liabilities 12 18,861,309 16,233,113
Non-current lease liabilities 8 269,157 305,110
Non-current payables 443 8,346
Other non-current provisions 16 2,084,288 2,090,487
Deferred tax liabilites 5 5,141,451 4,860,881
Non-current provisions for employee benefits 17 1,152,540 1,283,357
Other non-current non-fnancial liabilities 2,666 5,693
Total non-current liabilities 27,511,854 24,786,987
Total liabilities 30,729,647 28,709,944
Equity

Issued capital 5,619,423 5,619,423
Accumulated deficit (134,156) (196,260)
Other reserves 18 5,272,097 5,291,747
[Equity attributable to owners of the parent 10,757,364 10,714,910 |
Non-controlling interests 18 919,458 919,757
Total equity 11,676,822 11,634,667
[Total liabilities and equity 42,406,469 40,344,611 |

The accompanying notes are an integral part of these interim consolidated financial statements.
CORPORACION NACIONAL DEL COBRE DE CHILE
INTERIM CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) – BY FUNCTION
For the nine month and three month periods ended September 30, 2020 and 2019 (Unaudited)

(In thousands of US dollars – TRUS$)

(Translation into English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Notes 1/1/2020 1/1/2019 7/1/2020 7/1/2019
No 9/30/2020 9/30/2019 9/30/2020 9/30/2019

Revenue 19 9,228,639 8,808,184 3,989,782 2,891,435
Costofsales (7,310,693) (7,256,283) (2,797,494) (2,594,371)
[Gross profit 1,917,946 1,551,901 1,192,288 297,064 |
Other Income, by function 21a 75,253 206,981 12,145 116,268
Net (reversal) provision under IFRS 9 (934) 1,176 594 588
Distribution costs (6,995) (12,647) (1,945) (4,863)
Administrative expenses (262,416) (303,025) (84,053) (99,579)
Other expenses 21b (969,845) (1,328,133) (376,973) (342,807)
Other gains 18,264 17,038 3,546 3,924
[Income (loss) from operating activities 771,273 133,291 745,602 (29,405)]
Finance income 35,412 22,504 6,879 4,836
Finance costs 22 (520,374) (360,104) (182,375) (99,965)
Share of profitof associates and joint ventures accounted for using 9 9,713 11,863 22,230 6.630
equity method

Foreign exchange difference 24 136,947 114,946 (126,318) 175,128
[Income (loss) for the period before tax 432,971 (77,500) 466,018 57,224 ]
Income tax expense 5 (361,048) (20,499) (347,729) (54,989)
[Net income (loss) for the period 71,923 (97,999) 118,289 2,235 ]
Netincome (loss) attributable to owners of parent 64,656 (105,530) 111,793 (957)
Netincome attibutable to non-controlling interests 18.b 7,267 7,531 6,496 3,192
[Net income (loss) for the period 71,923 (97,999) 118,289 2,235 ]

The accompanying notes are an integral part of these interim consolidated financial statements.
CORPORACION NACIONAL DEL COBRE DE CHILE
INTERIM CONSOLIDATED STATEMENTS OF OTHER COMPREHENSIVE INCOME (LOSS)
CONTINUED
For the nine month and three month periods ended September 30, 2020 and 2019 (Unaudited)
(In thousands of US dollars – TRUS$)
(Translation into English of the consolidated financial statements originally issued in Spanish – see Note 1.2)

Notes 1/1/2020 1/1/2019 7/1/2020 7/1/2019
N? 9/30/2020 9/30/2019 9/30/2020 9/30/2019

Net income (loss) for the period 71,923 (97,999) 118,289 2,235

Components of other comprehensive income that will not be
reclassified to profit or loss, before tax:

Loss on remeasurement of defined benefit plans, before tax (2,288) (10,882) (73) (7,021)
Share ofother comprehensive income of associates and joint ventures

accounted for using the equity method that will not be reclassiñied to profit – 2,364 – 2,364
or loss before tax

Other comprehensive loss that will not be reclassified to profit (2,288) (8,518) (73) (4,657)
or loss before tax

Components of other comprehensive income that will be

reclassified to profit or loss, before tax:

Gain (loss) on exchange diference on translation, before tax 2,834 (1,990) 1,607 (1,867)
(Loss) gain on cash fow hedges, before tax (61,841) (40,540) 39,975 22,528
Share ofother comprehensive (loss) income of associates and joint (58) 4 (56) 4
ventures accounted for using equity method

Other comprehensive (loss) income that will be reclassified to (59,065) (42,519) 41,526 20,665
profit or loss before tax

Other comprehensive (loss) income, before tax (61,353) (51,037) 41,453 16,008
Income tax effect of components of other comprehensive

income which will be reclassified to profit or loss

Income tax effect relating to benefit plans in other comprehensive income 5 1,506 7,349 41 4,784
Income tax effect of components of other comprehensive

income which will be reclassified to profit or loss

pe tax effect related to cash fow hedges in other comprehensive 5 40,197 26,351 (25,983) (14,643)
Total other comprehensive (loss) income (19,650) (17,337) 15,511 6,149
Total comprehensive income (loss) 52,273 (115,336) 133,800 8,384
Comprehensive income (loss) attributable to:

Comprehensive income (loss) attributable to owners ofthe parent 45,006 (122,867) 127,304 5,192
Comprehensive income attributable to non-controlling interests 18.b 7,267 7,531 6,496 3,192
[Total comprehensive income (loss) 52,273 (115,336) 133,800 8,384 ]

The accompanying notes are an integral part of these interim consolidated financial statements.
CORPORACION NACIONAL DEL COBRE DE CHILE
INTERIM CONSOLIDATED STATEMENTS OF CASH FLOWS – DIRECT METHOD
For the nine month periods ended September 30, 2020 and 2019 (Unaudited)
(In thousands of US dollars – TRUS$)
(Translation into English of the consolidated financial statements originally issued in Spanish – see Note 1.2)

Notes 1/1/2020 1/1/2019
Ne 9/30/2020 9/30/2019
Cash flows provided by operating activities:
Receipts from sales of goods and rendering of services 9,442,138 9,437,523
Other cash receipts from operating actvites 25 1,443,227 1,436,936
Payments to suppliers for goods and services (5,665,521) (6,070,326)
Payments to and on behalf of employees (1,129,790) (1,423,993)
Other cash payments from operating activities 25 (1,680,968) (976,755)
Dividends received 22,715 84,372
Income taxes paid (24,978) (60,209)
[Cash fows provided by operating activities 2,406,823 2,427,548 |
Cash flows used in investing activities:
Other payments to acquire equity or debt instruments of other entities (176) (240)
Other charges for the sale of interests in joint ventures and associates 9 – 193,480
Purchase of property, plant and equipment (1,839,218) (3,067,395)
Interestreceived 33,719 19,191
Other cash (outfow) inflow (19,584) 209,244
[Cash fows used in investing activities (1,825,259) (2,645,720)|
Cash flows provided by financing activities:
Proceeds from borrowings long term 3,496,000 3,779,309
Proceeds from borrowings short term – 465,000
Total proceeds from borrowings 3,496,000 4,244,309
Repaymentof borrowings (1,117,874) (1,843,960)
Payments of finance lease liabiliies (100,744) (110,677)
Interest paid (625,486) (530,465)
Other cash (outfow) inflow (57,470) 197,995
Cash flows provided by financing activities 1,594,426 1,957,202
Increase in cash and cash equivalents before effects of exchange diference 2,175,990 1,739,030
Efiect of exchange rate changes on cash and cash equivalents (25,206) (913)
Increase in cash and cash equivalents 2,150,784 1,738,117
Cash and cash equivalents at beginning of period 1 1,303,105 1,229,125
Cash and cash equivalents atend of period 1 3,453,889 2,967,242

The accompanying notes are an integral part of these interim consolidated financial statements.
CORPORACION NACIONAL DEL COBRE DE CHILE
INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
For the nine month period ended September 30, 2020 and 2019 (Unaudited)
(In thousands of US dollars – TRUS$)
(Translation into English of the consolidated financial statements originally issued in Spanish – see Note 1.2)

Reserve of
Reserve on remeasurementof Other Total other Equity Non-controlling
September 30,2020 exchange Reserve ofcash | defined benefit miscellaneous reserves attributable to interests
Issued capital difierences on fow hedges plans Accumulated owners ofthe
reserves Total Equity
translation deficit parent
Note 17 Note 18 Note 18
Initial balance as of 1/1/2020 5,619,423 (6,672) 19,506 (305,770) 5,584,683 5,291,747 (196,260) 10,714,910 919,757 11,634,667
Changes in equity:
Netincome: 64,656 64,656 7,267 71,923
Other comprehensive income (loss) 2,834 (21,644) (782) (58) (19,650) (19,650) – (19,650)
Comprehensive income 45,006 7,267 52,273
Dividends – –
Capital contributions – – – – – –
Increase (decrease) through transfers and other changes – – (2,552) (2,552) (7,566)| (10,118)
Total changes in equity 2,834 (21,644) (782) (58) (19,650) 62,104 42,454 (299) 42,155
Final balance as of 9/30/2020 5,619,423 (3,838) (2,138) (306,552) 5,584,625 5,272,097 (134,156) 10,757,364 919,458 11,676,822

September 30,2019

Initial balance as of 1/1/2019
in
Netincome
Other ‘e income (loss)
income

Dividends

contributions
Increase (decrease,
Total in equi
Final balance as of 9/30/2019

transfers and other

The accompanying notes are an integral part of these interim consolidated financial statements.

Issued capital

400,000

Reserve on
exchange
diference on
translation

Reserve ofcash
fow hedges

Reserve of
remeasurement of
defined beneft
plans

Note 17
(27:

Other
miscellaneous
reserves

2,116)
259

Total other
reserves

Note 18
159

Accumulated
deficit

198,91

105,530

Equity
atributable to
owners ofthe

parent

10,37.

105,530)
17,33
1
400,000
2,781
27:
7

Non-controlling
interests

Note 18
969,204

7,531

7,531

55,683,
(48,1:
921

Total Equity

11

10

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

1.

GENERAL INFORMATION
Corporate Information

Corporación Nacional del Cobre de Chile (hereinafter referred to as “Codelco” or the “Corporation”), is, in
Management’s opinion, the largest copper producer in the world. Codelco’s most important product is
refined copper, primarily in the form of cathodes. The Corporation also produces copper concentrates, blister
and anode copper and by-products such as molybdenum, anode slime and sulfuric acid.

The Corporation trades its products based on a policy aimed to sell refined copper to manufacturers or
producers of semi-manufactured products.

These products contribute to diverse fields of community development, particularly those intended to
improve areas such as public health, energy efficiency, and sustainable development, among others.

The Corporation ¡is registered under Securities Registry No. 785 of the Chilean Commission for the Financial
Market (the “CMF”) and is subject to its supervision. According to Article No. 10 of Law No. 20392 (related
to the new Corporate Governance of Codelco), such supervision shall be on the same terms as publicly
traded companies, notwithstanding the provisions in Decree Law (D.L.) No.1349 of 1976, which created the
Comisión Chilena del Cobre (“Chilean Copper Commission”).

Codelco’s head office is located in Santiago, Chile, at 1270 Huérfanos Street, telephone number (56-2)
26903000.

Codelco was incorporated through D.L. No. 1350 of 1976, which is the statutory decree applicable to the
Corporation. In accordance with the statutory decree, Codelco is a governmment-owned mining, industrial
and commercial company, which is a separate legal entity with its own equity. Codelco Chile currently
carries out its mining business through its Chuquicamata, Radomiro Tomic, Ministro Hales, Gabriela Mistral,
Salvador, Andina, El Teniente and Ventanas divisions.

The Corporation also carries out similar activities in other mining deposits in association with third parties.

In accordance with letter e) of Article 10 of Law No. 20392, Codelco is governed by its organic standards
set forth in Decree Law No. 1350 (D.L. No. 1350) and that of its by-laws, and in matters not covered by them
and, insofar as they are compatible and do not contradict the provisions of such standards, by the rules that
govern publicly traded companies and the common laws as applicable to them.

In accordance with D.L. No. 1350 Section IV related to the Company’s Exchange and Budget Regulations.
Codelco’s financial activities are conducted following an annual budgeting program that is composed of an
Operations Budget, an Investment Budget and a Debt Amortization Budget.

The tax system applicable to Codelco’s taxable income is in accordance with Article 26 of D. L. No.1350
which refers to Decree Law No. 824 on Income Tax of 1974 and Decree Law No. 2398 (Article 2) of 1978,

11
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

2.

as applicable. The Corporation’s taxable income is also subject to a Specific Mining Tax in accordance with
Law No. 20026 of 2005.

According to Law No. 13196, the return on foreign currency of the Corporation’s foreign sales (real income),
of its copper production, including its by-products, is taxed at 10% and method of payment and the duration
of this obligation for Codelco, are specified in note 21 letter c) of this report.

The subsidiaries whose financial statements are included in these unaudited consolidated financial statements
correspond to companies located in Chile and abroad, which are detailed in Note 11.2.d.

The associates located in Chile and abroad, are detailed in the Explanatory Notes Section II! of Note 9.
Basis of Presentation of the Consolidated Financial Statements

The Corporation’s consolidated statements of financial position as of September 30, 2020 (unaudited) and
December 31, 2019 and the unaudited consolidated statements of comprehensive income for the nine
month and three month periods ended September 30, 2020 and 2019, changes in equity and of cash
flows for the nine month periods ended September 30, 2020 and 2019, have been prepared in accordance
with International Accounting Standards (IAS) No. 34. Interim Financial Reporting, as incorporated in
International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards
Board (IASB).

These unaudited interim consolidated financial statements include all information and disclosures required
in annual financial statements.

These unaudited interim consolidated financial statements have been prepared from accounting records
maintained by the Corporation.

The unaudited interim consolidated financial statements of the Corporation are presented in thousands of
United States dollar (*U.S. dollar”).

Responsibility for the Information and Use of Estimates

The Board of Directors of the Corporation has been informed of the information included in these
unaudited interim consolidated financial statements and expressly declared its responsibility for the
consistent and reliable nature of the information included in such financial statements as of September 30,
2020 and for the nine-month and three-month periods ended September 30, 2020 and 2019, which
financial statements fully comply with IFRS as issued by the lASB. These unaudited interim consolidated
financial statements as of September 30, 2020 and for the nine- and three-month periods ended
September 30, 2020 and 2019 were approved by the Board of Directors at a meeting held on October 29,
2020.

12
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Accounting Principles

These unaudited interim consolidated financial statements reflect the financial position of Codelco and its
subsidiaries as of September 30, 2020 and December 31, 2019, and the results of their operations, changes
in equity and cash flows for the nine month and three month periods ended September 30, 2020 and 2019,
and their related notes, all prepared in accordance with IAS 34, Interim Financial Reporting, in consideration
of the presentation instructions of the Commission for the Financial Markets, where not in conflict with IFRS.

For the convenience of the English readers, these consolidated financial statements and their
accompanying notes have been translated from Spanish into English.

SIGNIFICANT ACCOUNTING POLICIES
Significant Judgments and Key Estimates

In preparing these unaudited interim consolidated financial statements, the use of certain critical accounting
estimates and assumptions that affect the amounts of assets and liabilities recognized as of the date of the
financial statements and the amounts of revenue and expenses recognized during the reporting period is
required. Such preparation also requires the Corporation’s Management to exercise its judgment in the
process of applying the Corporation’s accounting policies. The areas involving a higher degree of judgment
or complexity, or areas where assumptions and estimates are significant to the consolidated financial
statements are as follows:

a) Useful economic lives and residual values of property, plant and equipment – The useful lives
and residual values of property, plant and equipment that are used for calculating depreciation are
determined based on technical studies prepared by internal specialists. The technical studies consider
specific factors related to the use of assets.

When there are indicators that could lead to changes in the estimates of the useful lives of such assets,
these changes are made by using technical estimates to determine the impact of any change.

b) Ore reserves – The measurements of ore reserves are based on estimates of the ore resources that
are legally and economically exploitable, and reflect the technical and environmental considerations of
the Corporation regarding the amount of resources that could be exploited and sold at prices exceeding
the total cost associated with the extraction and processing.

The Corporation applies judgment in determining the ore reserves, and as such, possible changes in
these estimates might significantly impact the estimates of net revenues over time. In addition, these
changes might lead to modifications in usage estimates, which might have an effect on depreciation
and amortization expense, calculation of stripping cost adjustments, determination of impairment
losses, expected future disbursements related to decommissioning and restoration obligations, long
term defined benefits plans’ accounting and the accounting for financial derivative instruments.

13
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The Corporation estimates ¡ts reserves and mineral resources based on the information certified by the
Competent Persons internal and external of the Corporation, who are defined and regulated according
to Law No. 20235. These estimates correspond to the application of the Certification Code of Ore
Reserves, Resources and Exploration, issued by the Mining Committee which was instituted through
the aforementioned law.

Notwithstanding the foregoing, the Corporation periodically reviews its estimation models, supported
by experts who, in some divisions, also certify the reserves determined from these models.

Impairment of non-financial assets – The Corporation reviews the carrying amount of its assets to
determine whether there is any indication that those assets have suffered an impairment loss. If any
such indicator exists, the recoverable amount of the assets is estimated in order to determine the extent
of the impairment loss. In testing impairment, the assets are grouped into cash generating units
(“CGUs”) to which the assets belong, where applicable. The recoverable amount of these CGUs is
calculated as the present value of the expected future cash flows from such assets, considering a pre-
tax discount rate that reflects current market assessments of the time value of money and the risks
specific to the asset. If the recoverable amount of the assets is lower than their carrying amount, an
impairment loss is recognized.

The Corporation defines the CGUs and also estimates the timing and cash flows that such CGUs will
generate. Subsequent changes in the grouping of the CGU, or changes in the assumptions supporting
the estimates of cash flows or the discount rate, may impact the carrying amounts of the corresponding
assets.

Estimates of assumptions influencing the calculation of cash flows, such as the price of copper or
treatment charges and refining charges, among others, are determined based on studies conducted
by the Corporation using uniform criteria over different periods. Any changes to these criteria may
impact the estimated recoverable amount of the assets.

The Corporation has assessed and defined that the CGUs are determined at the level of each of its
current operating divisions (see Segment footnote).

Impairment testing also is performed at subsidiaries and associates.

d) Provisions for decommissioning and site restoration costs – The Corporation is obliged to incur

decommissioning and site restoration costs when such site restoration or decommissioning is required
due to a legal or constructive obligation. Costs are estimated on the basis of a formal closure plan and
are reassessed annually or as of the date such obligations become known. The initial estimate of
decommissioning and site restoration costs is recognized as property, plant and equipment in
accordance with IAS 16, and simultaneously a liability in accordance with IAS 37, is recorded.

For these purposes, a defined list of mine sites, facilities and other equipment are studied under this
process, considering the engineering level profile, the cubic meters of assets that will be subject to
removal and restoration, weighted by a structure of market prices of goods and services, reflecting the
best current knowledge related to carrying out such activities, as well as techniques and more efficient

14
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

construction procedures to date. In the process of valuation of these activities, the assumptions of the
exchange rate for tradable goods and services is made, as well as a discount rate, which considers the
time value of money and the risks associated with the liabilities, which is determined based, where
applicable, on the currency in which disbursements are expected to be made.

The liability amounts recognized at the end of each reporting date represent management’s best
estimate of the present value of the future decommissioning and site restoration costs. Changes to
estimated future costs that result from changes in the estimated timing or amount of the outflow of
resources embodying economic benefits required to settle the obligation, or a change in the discount
rate are added to, or deducted from, the cost of the related asset in the current period (as well as the
associated liability). The amount deducted from the cost of the asset shall not exceed its carrying
amount. If a decrease in the liability exceeds the carrying amount of the asset, the excess is recognized
immediately in profit or loss.

If the adjustment results in an addition to the cost of the asset, Codelco considers whether this is an
indicator that the new carrying amount of the asset may not be fully recoverable. Ifitis considered such
an indicator, Codelco tests the asset for impairment by estimating its recoverable amount, and accounts
for any impairment loss in accordance with lAS 36.

The decommissioning costs are initially recorded at the moment when a plant or other assets are
installed. Such costs are capitalized as part of property, plant and equipment and discounted to their
present value. These decommissioning costs are charged to net income over the life of the mine,
through depreciation of the corresponding asset. Depreciation expense ¡is included in cost of sales,
while the unwinding of the discount in the provision is included in finance costs.

e) Provisions for employee benefits – Provisions for employee benefits related to severance payments
and health benefits for services rendered by the employees are determined based on actuarial
calculations using the projected unit credit method, and are recognized in other comprehensive income
or profit or loss (depending on the accounting standards applicable).on accrual bases.

The Corporation uses assumptions to determine the best estimate of future obligations related to these
benefits. Such estimates, as well as assumptions, are determined by management using the
assistance of external actuaries. These assumptions include demographic assumptions, discount rate
and expected salary increases and rotation levels, among other factors.

f) Accruals for open invoices – The Corporation uses information on future copper prices, through which
it recognizes adjustments to its revenues and trade receivables, due to the conditions in provisional
pricing arrangements. These adjustments are updated on a monthly basis, See Notes 2 r) “Revenue
from contracts with customers” of Note 2 “Significant accounting policies” below.

g) Fair value of derivatives and other financial instruments – Management may use its judgment to
choose an adequate and proper valuation method for financial instruments that are not quoted in an
active market. In the case of derivative financial instruments, assumptions are based on observable
market inputs, adjusted depending on factors specific to the instruments among others.

15
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

h) Lawsuits and contingencies – The Corporation assesses the probability of lawsuits and contingency

D

losses on an ongoing basis according to estimates performed by its legal advisors. For cases in which
management and the Corporation’s legal advisors believe that a loss is not probable of occurring or
where probable, may not be estimated reliably, no provisions are recognized. When it is considered
more likely than not that a loss is probable and it may be reliably estimated, a provision is recognized.

Application of IFRS 16 includes the following:

– Estimation of the lease term;
– Determine ¡fit is reasonably certain that an extension or termination option will be exercised;
– Determination of the appropriate rate to discount lease payments.

Revenue recognition -The Corporation determines appropriate revenue recognition for its contracts
with customers by analyzing the type, terms and conditions of each contract or agreement with a
customer.

As part of the analysis, the management must make judgments about whether an agreement or
contract is legally enforceable, and whether the agreement includes separate performance obligations.
In addition, estimates are required in order to allocate the total price of the transaction to each
performance obligation based on the stand-alone selling price of the promised goods or services
underlying each performance obligation. (The Corporation applies the constraint on variable
consideration as defined in IFRS 15, if applicable).

Although the abovementioned estimates have been made based on the best information available as of
the date of issuance of these consolidated financial statements, itis possible that new developments could
lead the Corporation to modify these estimates in the future. Such modifications, if applicable, would be
adjusted prospectively, as required by IAS 8 “Accounting Policies, Changes in Accounting Estimates and
Errors.”

16
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

2.

Significant accounting policies

a)

b)

Period covered – The accompanying interim consolidated financial statements of Corporación
Nacional del Cobre de Chile include the following statements:

– Consolidated statements of financial position as of September 30, 2020 (unaudited) and December
31, 2019.

– Unaudited interim consolidated statements of comprehensive income for the nine month and three
month periods ended September 30, 2020 and 2019.

– Unaudited interim consolidated statements of changes in equity for the nine month periods ended
September 30, 2020 and 2019.

– Unaudited interim consolidated statements of cash flows for the nine month periods ended
September 30, 2020 and 2019.

Basis of preparation – The unaudited interim consolidated financial statements of the Corporation as
of September 30, 2020 and for the nine-month periods ended September 30, 2020 and 2019, have
been prepared in accordance with the instructions from the Commission for the Financial Market which
fully comply with IFRS as issued by the lASB.

The consolidated statement of financial position as of December 31, 2019, and the consolidated
statement of income, the consolidated statement of changes in equity and consolidated statement of
cash flows for the nine-month and three-month periods ended September 30, 2019 (unaudited), which
are included for comparative purposes, have been prepared in accordance with IFRS issued by the
lASB, on a basis consistent with the criteria used for the same periods ended September 30, 2020,
except for the adoption of the new IFRS standards and interpretations adopted by the Corporation as
of and for the nine-month periods ended September 30, 2020, which are disclosed in note 11.3.

These consolidated financial statements have been prepared based on the accounting records kept by
the Corporation.

Functional Currency – The functional currency of Codelco is the U.S. dollar, which is the currency of
the primary economic environment in which the Corporation operates and the currency in which it
receives ¡ts revenues.

The functional currency of subsidiaries, associates and joint ventures, is the currency of the primary
economic environment in which those entities operate and the currency in which they receive their
revenues. For those subsidiaries and associates that are an extension of the operations of Codelco
(entities that are not self-sustaining and whose main transactions are with Codelco); the functional
currency is also the U.S. dollar.

The presentation currency of Codelco’s consolidated financial statements is the U.S. dollar.

17
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

d) Basis of consolidation – The consolidated financial statements incorporate the financial statements
of the Corporation and its subsidiaries.

Subsidiaries are fully consolidated from the date of acquisition, being the date on which the Corporation
obtains control, and continue to be consolidated until the date such control ceases. Specifically, income
and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated
statement from the date the Corporation gains control until the date when the Corporation ceases to
control the subsidiary.

The financial statements of the subsidiaries are prepared for the same reporting period as the
Corporation, using consistent accounting policies.

All assets, liabilities, equity, income, expenses and cash flows related to transactions between
consolidated companies are fully eliminated on consolidation. Non-controlling interests in equity and in
the comprehensive income of the consolidated subsidiaries are presented, respectively, under the line
items “Total Equity: Non-controlling interests” in the consolidated statement of financial position and
“Net income attributable to non-controlling interests” and “Comprehensive income attributable to non-
controlling interests” in the consolidated statement of comprehensive income.

18
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The companies included in the consolidation are as follows:

Taxpayer ID 9/30/2020 12/31/2019
Number Company Country Currency % Ownership % Ownership
Direct Indirect Total Total
Foreign Chile Copper Limited England GBP 100.00 – 100.00 100.00
Foreign Codelco do Brasil Mineracao Brazil BRL – 100.00 100.00 100.00
Foreign Codelco Group Inc. Unid Sesa yg 100.00 -| 100.00 100.00
America
Foreign Codelco International Limited Bermuda US$ 100.00 . 100.00 100.00
Foreign Codelco Kupferhandel GmbH Germany EUR 100.00 – 100.00 100.00
Foreign Codelco Metals Inc. Unid Sesa yg – | 100.00| 100.00 100.00
America
Foreign Codelco Services Limited England GBP – 100.00 100.00 100.00
Foreign Codelco Shanghai Company Limited China RMB 100.00 – 100.00 100.00
Foreign Codelco USA Inc. Unid Sesa yg – | 100.00| 100.00 100.00
America
Foreign Codelco Canada Canada US$ 0.97 99.03 100.00 100.00
Foreign Ecometales Limited Canna US$ -| 100.00] 100.00 100.00
Foreign Exploraciones Mineras Andinas Ecuador EMSAEC S.A. Ecuador US$ – 100.00 100.00 100.00
Foreign Cobrex Prospeccao Mineral Brazil BRL – 51.00 51.00 51.00
78.860.780-6 |Compañía Contractual Minera los Andes Chile US$ 99.97 0.03 100.00 100.00
81.767.200-0 [Asociación Garantizadora de Pensiones Chile CLP 96.69 – 96.69 96.69
88.497.100-4 — [Clínica San Lorenzo Limitada Chile CLP 99.90 0.10 100.00 100.00
96.817.780-K [Ejecutora Proyecto Hospital del Cobre Calama S.A. Chile US$ 99.99 0.01 100.00 100.00
96.819.040-7 |Complejo Portuario Mejillones S.A. Chile US$ 99.99 0.01 100.00 100.00
96.991.180-9 [Codelco Tec SpA Chile US$ 99.91 0.09 100.00 100.00
99.569.520-0 [Exploraciones Mineras Andinas S.A. Chile US$ 99.90 0.10 100.00 100.00
99.573.600-4 [Clínica Río Blanco S.A. Chile CLP 99.00 1.00 100.00 100.00
76.064.682-2 [Centro de Especialidades Médicas Río Blanco Ltda. Chile CLP 99.00 1.00 100.00 100.00
77.773.260-9 |Inversiones Copperfeld SpA Chile US$ 100.00 – 100.00 100.00
76.043.396-9 [Innovaciones en Cobre S.A. Chile US$ 0.05 99.95 100.00 100.00
76.148.338-2 [Sociedad de Procesamiento de Molibdeno Ltda. Chile US$ 99.95 0.05 100.00 100.00
76.173.357-5 | Inversiones Gacrux SpA Chile US$ 100.00 – 100.00 100.00
76.231.838-5 | Inversiones Mineras Nueva Acrux SpA Chile US$ – 67.80 67.80 67.80
76.237.866-3 — | Inversiones Mineras Los Leones SpA Chile US$ 100.00 – 100.00 100.00
76.173.783-K | Inversiones Mineras Becrux SpA Chile US$ – 67.80 67.80 67.80
76.124.156-7 [Centro de Especialidades Médicas San Lorenzo Ltda. Chile US$ – 100.00 100.00 100.00
76.255.061-K [Central Eléctrica Luz Minera SpA Chile US$ 100.00 – 100.00 100.00
70.905.700-6 |Fusat Chile CLP – – – –
76.334.370-7 — |Isalud Isapre de Codelco Ltda. Chile CLP 59.26 40.73 99.99 99.99
78.394.040-K [Centro de Servicios Médicos Porvenir Ltda. Chile CLP – 99.00 99.00 99.00
77.928.390-9 | Inmobiliaria e Inversiones Rio Cipreces Ltda. Chile CLP – 99.90 99.90 99.90
77.270.020-2 — [Prestaciones de Servicios de la Salud Intersalud Ltda. Chile CLP – 99.00 99.00 99.00
76.754.301-8 — |Salar de Maricunga SpA Chile CLP 100.00 – 100.00 100.00

On July 15, 2019, according to Bermuda Registration Certificate No. 28890, the merger between
Codelco Technologies and Codelco International was reported, the latter being the absorbing
company of Codelco Technologies, through which transaction it acquired 9.99 % of subsidiary
Codelco Brasil Mineracao and 100% of Ecometales Limited.

On December 2, 2019, by public deed, a merger by incorporation was approved for the following
subsidiaries, all ofthem providing health insurance: , Institución de Salud Previsional
Chuquicamata Ltda., San Lorenzo Institución de Salud Previsional Ltda., Institución de Salud
Previsional Río Blanco Ltda., and Institución de Salud Previsional Fusat Ltda., being the latter the

19
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

absorbing and surviving company. In addition, a modification to the statutes was approved in relation
to a change in the company name, capital increase, and ownership of the share capital.

For the purposes of these unaudited interim consolidated financial statements, subsidiaries,
associates, acquisitions and disposals are defined as follows:

.

Subsidiaries – A subsidiary is an entity over which the Corporation has control. Control is
exercised if, and only if, the following conditions are met: the Corporation has i) power to direct
the relevant activities of the subsidiaries unilaterally; ii) exposure or rights to variable returns from
these entities; and ¡i¡) the ability to use its power to influence the amount of these returns.

The Corporation reassesses whether or not it controls a subsidiary if facts and circumstances
indicate that there are changes to one or more of the elements of control listed above.

The unaudited interim consolidated financial statements include all assets, liabilities, revenues,
expenses and cash flows of Codelco and its subsidiaries, after eliminating all inter-company
balances and transactions.

The value of the participation of non-controlling shareholders in equity, net income and
comprehensive income of subsidiaries are presented, respectively, in the headings “Non-
controlling interests” of the consolidated statement of financial position; “Net income attributable
to non-controlling interests”; and “Comprehensive income attributable to non-controlling interests”
in the statements of comprehensive income.

Associates – An associate is an entity over which Codelco has significant influence. Significant
influence ¡is the power to participate in the financial and operating policy decisions of the associate
but is not control or joint control over those policies.

Codelco’s interest ownership in associates is recognized in the consolidated financial statements
under the equity method. Under this method, the initial investment is recognized at cost and
adjusted thereafter to recognize changes in Codelco’s share of the comprehensive income of the
associate, less any impairment losses or other changes to the investment in net assets of the
associate.

Appropriate adjustments to the Codelco’s share of the associate’s profit or loss after acquisition
are made in order to account for depreciation of the depreciable assets and related deferred tax
balances based on their fair values at the acquisition date.

Acquisitions and Disposals – The results of businesses acquired are incorporated in the
consolidated financial statements from the date when control is obtained; the results of businesses
sold during the period are included in the consolidated financial statements up to the effective date
of disposal. Gains or losses on disposal is the difference between the sale proceeds (net of
expenses) and the carrying amount of the net assets attributable to the ownership interest that
has been sold (and, where applicable, the associated cumulative translation adjustment).

20
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

If control is lost over a subsidiary, the retained ownership interest in the investment will be
recognized at its fair value.

At the acquisition date of an investment in a subsidiary, associate or joint venture, any excess of
the cost of the investment (consideration transferred) plus the amount of the non-controlling
interest in the acquiree plus the fair value of any previously held equity interest in the acquiree,
where applicable, over Codelco’s share of the net fair value of the identifiable assets and acquired
liabilities is recognized as goodwill. Any excess of Codelco’s share of the net fair value of the
identifiable assets and acquired liabilities over the consideration transferred, after reassessment,
is recognized immediately in profit or loss in the period in which the investment is acquired.

e) Foreign currency transactions and reporting currency conversion- Transactions in currencies
other than the Corporation’s functional currency are recognized at the rates of exchange prevailing at the
dates of the transactions. At the end of each reporting period, foreign currency transactions denominated
in foreign currencies are converted at the rates prevailing at that date. Exchange differences on such
transactions are recognized in profit or loss in the period in which they arise and are included in line item

“Foreign exchange differences” in the consolidated statement of comprehensive income.

At the end of each reporting period, assets and liabilities denominated in Unidades de Fomento (UF or
inflation index-linked units of account) are translated into U.S. dollars at the closing exchange rates at
that date (09/30/2020: US$36.42; 12/31/2019: US$37.81; 09/30/2019: US$38.52). The expenses and
revenues in Chilean pesos have been expressed in dollars at the observed exchange rate,

corresponding to the date of the accounting recording of each operation.

The financial statements of subsidiaries, associates and jointly controlled entities, whose functional
currency is other than the presentation currency of Codelco, are translated as follows for purposes of

consolidation:

Assets and liabilities are translated using the prevailing exchange rate on the closing date of the
financial statements.

Income and expenses for each statement of comprehensive income are translated at average
exchange rates for the period.

All resulting exchange differences are recognized in other comprehensive income and
accumulated in equity under the heading “Reserve on exchange differences on translation.”

The exchange rates used in each reporting period were as follows:

Closing exchange ratios

Relation 9/30/2020 | 12/31/2019 | 9/30/2019
US$ /CLP 0.00127 0.00134 0.00137
US$ / GBP 1.29032 1.31320 1.22820
US$ / BRL 0.17768 0.24910 0.24045
US$ / EUR 1.17123 1.12133 1.09016
US$ / AUD 0.71649 0.70018 0.67508
US$ / HKD 0.12903 0.12844 0.12757

21
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

f) Offsetting balances and transactions – In general, assets and liabilities, income and expenses, are
not offset in the financial statements, unless required or permitted by an IFRS or when offsetting reflects
the substance of the transaction as well as when it ¡is the intention of the Corporation to settle a transaction
net.

Income or expenses arising from transactions which, for contractual or legal reasons, permit the
possibility of offsetting and which the Corporation intends to liquidate for their net value or realize the
assets and settle the liabilities simultaneously, are stated net in the statement of comprehensive
income.

g) Property, plant and equipment and depreciation — Items of property, plant and equipment are
initially recognized at cost. Subsequent to initial recognition, they are measured at cost, less any
accumulated depreciation and any accumulated impairment losses.

Extension, modernization or improvement costs that represent an increase in productivity, capacity or
efficiency, or an increase in the useful life of the assets are capitalized as increasing the cost of the
corresponding assets.

The assets included in property, plant and equipment are depreciated, as a general rule, using the
units of production method, when the activity performed by the asset is directly attributable to the mine
production process. All other assets included in property, plant and equipment are depreciated using
the straight-line method.

The assets included in property, plant and equipment and certain intangibles (software) are depreciated
over their economic useful lives, as described below:

Category Useful Life
Land Not depreciated
Land on mine site Units of production
Buildings Straight-line over 20-50 years
Buildings in underground mine levels Units of production level
Vehicles Straight-line over 3-7 years
Plant and equipment Units of production
Smelters Units of production
Refineries Units of production
Mining rights Units of production
Support equipment Units of production
Intangibles — Software Straight-line over 8 years
Open pit and underground mine
development Units of production

Estimated useful lives, residual values and depreciation method are reviewed at the end of each
reporting period, and any change in estimates is recognized prospectively.

22
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Additionally, depreciation methods and estimated useful lives of assets, especially plants, facilities and
infrastructure may be revised at the end of each year or during the year according to changes in the
structure of reserves of the Corporation and productive long-term plans updated as of that date.

This review may be made at any time ¡f the conditions of ore reserves change significantly as a result
of new known information, confirmed and officially released by the Corporation.

Gains or losses on the sale of disposal of an asset are calculated as the difference between the net
disposal proceeds received and the carrying amount of the asset, and are included in profit or loss
when the asset is derecognized.

Construction in progress includes the amounts invested in the construction of property, plant and
equipment and in mining development projects. Construction in progress is transferred to assets in
operation once the testing period has ended and when they are ready for use; at that point, depreciation
begins to be recognized.

Borrowing costs that are directly attributable to the acquisition or construction of assets that require a
substantial period of time before they are ready for use or sale are capitalized as part of the cost of the
corresponding items of property, plant and equipment.

The ore deposits owned by the Corporation are recorded in the accounting records at US$1.

Notwithstanding the above, those reserves and resources acquired as part of acquisition of entities
accounted for as business combinations, are recognized at their fair value.

h) Intangible assets – The Corporation initially recognizes these assets at acquisition cost. Subsequent
to initial recognition, intangible assets are amortized in a systematic way over their economic useful life,
except for those assets with indefinite useful life, which are not amortized. Indefinitely-lived intangible
assets are tested for impairment at least annually, and whenever there ¡is an indication that these assets
may be impaired. Definitely-lived intangible assets are tested for impairment when an indicator of
impairment has been identified. At the end of each reporting period, these assets are measured at their
cost less any accumulated amortization (when applicable) and any accumulated impairment losses.

The main intangible assets are described as follows:

Research and Technological Development and Innovation Expenditures: The expenditures for
the development of Technology and Innovation Projects are recognized as intangible assets at their
cost and are considered to have indefinite useful lives.

Development expenses for technology and innovation projects are recognized as intangible assets at
cost, if and only if, all of the following have been demonstrated:
e The technical feasibility of completing the intangible asset so that it will available for use or
sale;
+ The intention to complete the intangible asset is to use or sell it;

23
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

e The ability to use or sell the intangible asset;

e That the intangible asset will generate probable future economic benefits;

e The availability of adequate technical, financial and other resources to complete the
development and to use or sell the intangible asset; and

e The ability to measure reliably the expenditure attributable to the intangible asset during its
development.

Research expenses for technology and innovation projects are recognized in profit or loss when
incurred.

i) Impairment of property, plant and equipment and intangible assets — The carrying amounts of
property, plant and equipment and intangible assets with finite useful lives are reviewed to determine
whether there is an indication that those assets have suffered an impairment loss. If any such indicator
exists, the Corporation estimates the asset’s recoverable amount to determine the extent of the
impairment loss which is then recorded.

For intangible assets with indefinite useful lives, their recoverable amounts are annually estimated at
the end of each reporting period.

When an asset does not generate cash flows that are independent from other assets, Codelco
determines the recoverable amount of the CGU to which the asset belongs.

The Corporation has defined each of its divisions as a cash generating unit.

Recoverable amount of an asset is the higher of fair value less costs of disposal and value in use. In
assessing value in use, the estimated future cash flows are discounted to their present value using a
pre-tax discount rate that reflects current market assessments of the time value of money and the risks
specific to the asset. On the other hand, the fair value less cost of disposal is usually determined for
operational assets considering the Life of Mine (‘LOM”), based on a model of discounted cash flows,
while the assets not included in LOM as resources and potential resources to exploit are measured by
using a market model of multiples for comparable transactions.

If the recoverable amount of an asset or CGU is estimated to be less than its carrying amount, an
impairment loss is recognized immediately in profit or loss, reducing the carrying amount to its
recoverable amount. Ifan impairment loss subsequently reverses, the carrying amount of the asset or
CGU is increased to the revised estimate of its recoverable amount, but so that the increased carrying
amount does not exceed the carrying amount that would have been determined had no impairment
loss been recognized for the asset or CGU in prior years.

The estimates of future cash flow for a CGU are based on future production forecasts, future prices of
basic products and future production costs. Under lAS 36 “Impairment of Assets”, there are certain
restrictions for future cash flows estimates related to future restructurings and future cost efficiencies.
When calculating value in use, it is also necessary to base the calculations on the spot exchange rate
at the date of calculation.

24
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

j) Expenditures for exploration and evaluation of mineral resources, mine development and mining
operations – The Corporation has defined an accounting policy for each of these expenditures.

Development expenses for deposits under exploitation whose purpose is to maintain production levels
are recognized in profit or loss when incurred.

Exploration and evaluation costs such as: drillings of deposits, including expenses necessary to locate
new mineralized areas and engineering studies to determine their potential for commercial exploitation
are recognized in profit or loss, normally at the pre-feasibility stage.

Pre-operating and mine development expenses (normally after feasibility engineering is reached)
incurred during the execution of a project and until its start-up are capitalized and amortized in relation
to the future production of the mine. These costs include stripping of waste material, constructing the
mine’s infrastructure and other works carried out prior to the production phase.

Finally, costs for defining of new areas or deposit areas in exploitation and of mining operations (PP3.E)
are recognized in property, plant and equipment and are amortized through profit or loss over the
period during which the benefits are obtained.

k) Stripping costs – Costs incurred in removing mine waste materials (overburden) in open pits that are
in production, that provide access to mineral deposits, are recognized in property, plant and equipment,
when the following criteria set out in IFRIC 20 Stripping Costs in the Production Phase of a Surface Mine
are met:
– — Itis probable that the future economic benefits associated with the stripping activity will flow to the
entity.
– — Itis possible to identify the components of an ore body for which access has been improved as a
result of the stripping activity.
– The costs relating to that stripping activity can be measured reliably.

The stripping costs are amortized based on the production units of production extracted from the ore
body related to the specific stripping activity which generated this amount.

I) Income taxes and deferred taxes – Codelco and its Chilean subsidiaries recognize annually income
taxes based on the net taxable income determined as per the standards established in the Income Tax
Law and Article 2 of D.L. 2398, as well as, the specific tax on mining referred to in Law 20026 of 2005. Its
foreign subsidiaries recognize income taxes according to the tax regulations in each country.

In addition, Codelco’s taxable income in each period is subject to the tax regime established in Article
26 of D.L. No. 1350, which states that tax payments will be made on March, June, September and
December of each year, based on a provisional tax calculation.

Deferred taxes on temporary differences and other events that generate differences between the

accounting and tax bases of assets and liabilities are recognized in accordance with IAS 12 “Income
taxes.”

25
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Deferred taxes are also recognized for undistributed profits of subsidiaries and associates, originated
by withholding tax rates on remittances of dividends paid out by such companies to the Corporation.

Income tax expense is recognized based on the best estimate of the weighted average annual effective
income tax rate expected for the full financial year in interim periods.

m) Inventories – Inventories are measured at cost, when such does not exceed net realizable value. Net
realizable value represents the estimated selling price for inventories less all estimated costs of
completion and costs necessary to make the sale (i,e,, marketing, sales and distribution expenses). Costs
of inventories are determined according to the following methods:

– Finished products and products in process: These inventories are measured at their average
production cost determined using the absorption costing method, including labor, depreciation of fixed
assets, amortization of intangibles and indirect costs of each period. Inventories of products in process
are classified in current and non-current, according to the normal cycle of operation.

– Materials in warehouse: These inventories are measured at their acquisition cost. The Corporation
estimates an allowance for obsolescence considering the turnover rate of slow-moving materials in the
warehouse.

– Materials in transit: These inventories are measured at cost incurred at the end of reporting period.
Any difference as a result of an estimate of net realizable value of the inventories lower than it carrying
amount is recognized in profit or loss.

n) Dividends – In accordance with Article 6 of D.L. 1350, the Corporation has a mandatory obligation to
distribute its net income as presented in the financial statements. The payment obligation is recognized
on an accrual basis.

o) Employee benefits – Codelco recognizes a provision for employee benefits when there is a present
obligation (legal or constructive) as a result of services rendered by its employees.

The employment contracts stipulate, subject to compliance with certain conditions, the payment of an
employee severance indemnity when an employment contract ends. In general, this corresponds to
one monthly salary per year of service and considers the components of the final remuneration which
are contractually defined as the basis for the indemnity. This employee benefit has been classified as
a defined benefit plan.

Codelco has also agreed to post-employment medical care benefits for certain retirees, which are paid
based on a fixed percentage covered by this agreement. This employee benefit has been classified as
a defined benefit plan.

These plans continue to be unfunded as of September 30, 2020.

26
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The employee severance indemnity and the post-employment medical plan obligations are determined
using the projected unit credit method, with actuarial valuations being carried out at the end of each
reporting period. The defined benefit plan obligations recognized in the statement of financial position
represent the present value of the accrued obligations. Actuarial gains and losses are recognized
immediately in other comprehensive income and will not be reclassified to profit or loss.

The Corporation’s management uses assumptions to determine the best estimate of these benefits.
The assumptions include an annual discount rate, expected increases in salaries and turnover rate,
among other factors.

In accordance with ¡ts operating optimization programs to reduce costs and increase labor productivity
by incorporating new current technologies and/or better management practices, the Corporation has
established employee retirement programs by amending certain employment contracts or collective
union agreements to include benefits encouraging employees to early retire. Accordingly, these
arrangements are accounted for as early retirement benefits and required accruals are established
based on the accrued obligation at current value. In case of employee retirement programs which
involve multi-year periods, the accrued obligations are updated using a discount rate determined based
on financial instruments denominated in the same currency and similar maturities that will be used to
pay the obligations.

p) Provisions for decommissioning and site restoration costs – The Corporation is obliged to incur
decommissioning and site restoration costs when such site restoration or decommissioning is required
due to a legal or constructive obligation. Costs are estimated on the basis of a formal closure plan and
cost estimates are annually reviewed.

A provision is recognized for decommissioning and site restoration costs. The amount of the provision
is the present value of the expenditures expected to be required to settle the obligation. The provision
is initially recognized with a corresponding increase in the carrying amount of the related assets.

The provision for decommissioning and site restoration costs is accreted over time to reflect the
unwinding of the discount with the accretion expense included in finance costs in the statement of
income. The carrying amount of the related asset is depreciated over ¡ts useful life.

Changes in the measurement of the decommissioning and site restoration provision that result from
changes in the estimated timing or amount of the outflow of resources embodying economic benefits
required to settle the obligation, or a change in the discount rate, are added to, or deducted from, the
cost of the related assets in the period when changes occurred. The amount deducted from the cost of
the related assets cannot exceed it carrying amount. If a decrease in the liability exceeds the carrying
amount of the asset, the excess is recognized immediately in profit or loss.

If the adjustment results in an addition to the cost of an asset, the Corporation considers whether this
is an indication that the new carrying amount of the asset may not be fully recoverable. If such an
indicator exists, the Corporation tests the asset for impairment by estimating its recoverable amount,
and recognizes an impairment loss, if any.

27
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The effects of the updating of the liability, due to the effect of the discount rate and / or passage of time,

is recorded as a financial expense.
q) Leases -The Corporation evaluates ¡its contracts at initial application to determine whether they contain
a lease. The Corporation recognizes an asset for right of use and a corresponding liability for lease with
respect to all lease agreements in which Codelco is the lessee, except for short-term leases (defined as
a lease with a lease term of 12 months or less) and leases of low-value assets. For these leases, the
Corporation recognizes lease payments as an operating cost on a straight-line basis over the term of the
lease unless another systematic basis is more representative of the time pattern in which the economic
benefits of the leased assets are consumed.

The lease liability is initially measured at the present value of the lease payments that have not been
paid at the commencement date, discounted using the interest rate implicit in the lease. If this rate
cannot be easily determined, the Corporation uses the incremental borrowing rate.

The incremental rate for loans used by Codelco is determined by estimating the interest rate that the
Corporation would have to pay for borrowing the necessary funds to obtain an asset of an equivalent
nature similar in value to the right-of-use asset of the respective lease, in a similar economic
environment over a similar term.

Lease payments included in the measurement of the lease liability mainly include fixed payments,
variable payments that depend on an index or a rate and the exercise price of a purchase option.
Variable payments that do not depend on an index or a rate are excluded.

The lease liability is subsequently measured as follows: the carrying amount increased to reflect the
interest on the lease liability (using the effective rate method) and the carrying amount is reduced to
reflect the lease payments made.

The Corporation revalues the lease liability as to the discount rate (and makes the corresponding
adjustments to the asset for respective right of use) when:

– There is a change in the term of the lease or;
– There is a change in the assessment of an option to purchase the underlying asset or;
– There is a change in an index or rate which generates a change in cash flows.

The right-of-use assets include the amount of the initial measurement of the lease liability, the lease
payments made before or until the start date less the lease incentives received and any initial direct
costs incurred. The assets for right to use are subsequently measured at cost less accumulated
depreciation and accumulated losses due to impairment.

When the Corporation incurs a cost obligation to dismantle or remove a leased asset, restore the
location in which it is located or restore the underlying asset to the condition required by the terms and
conditions of the lease, a provision is recognized and measured in accordance with lAS 37. Costs are
included in the corresponding asset for right of use, unless those costs are incurred to produce
inventories.

28
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The right-of-use assets are depreciated during the shorter period between the term of the lease and
the useful life of the underlying asset. If a lease transfers the ownership of the underlying asset or the
cost of the asset for right of use reflects that the Corporation expects to exercise its option to purchase,
the right-of-use asset is depreciated over the useful life of the underlying asset. Depreciation is made
from the start date of the lease.

The Corporation applies IAS 36 to determine if an asset for right of use is impaired and recognizes any
impairment loss identified, as described in the accounting policy for “Property, plant and equipment”.

r) Revenue from Contracts with Customers – Revenue is recognized in an amount that reflects the
consideration to which the entity expects to be entitled in exchange for transferring goods or services to
customers.

Sale of mineral goods and / or by-products: Contracts with customers for the sale of mineral
goods and / or by-products include the performance obligation for the delivery of the physical goods
and the associated transportation service, at the place agreed with the customers. The Corporation
recognizes revenue from the sale of goods when the performance obligation is satisfied according
to the shipment or dispatch of the products, in accordance with the agreed conditions, such
revenue being subject to variations related to the content and / or sale price at the date of its
liquidation. Notwithstanding the foregoing, there are some contracts where the performance
obligation is satisfied when there is receipt of the product (FOB ship point) instead of the buyer’s
corresponding destination, thus recognizing revenue at the time of said transfer. When services of
transport of goods are provided, the Corporation recognizes revenue when the service obligation
is satisfied.

Sales that have discounts associated with volume subject to compliance with goals are recognized
net, estimating the probability that the volume target will be reached.

Sales contracts include a provisional price at the shipment date. The final price is generally based
on the London Metals Exchange (“LME”) price. Revenue from sales of copper is measured using
estimates of the future spread of metal prices on the LME and/or the spot price at the date of
shipment, with subsequent adjustments made upon final pricing recognized as revenue. The terms
of sales contracts with customers contain provisional pricing arrangements whereby the selling
price for metal concentrate is based on prevailing spot prices on a specified future date after
shipment to the customer (the “quotation period”). Consequently, the final price is set at the dates
indicated in the contracts. Adjustments to provisional sale prices occur based on movements in
quoted market prices on the LME up to the date of final pricing. The period between provisional
invoicing and final pricing is typically between one and nine months. Changes in fair value over the
quotation period and until final pricing are estimated by reference to forward market prices for
applicable metals.

In terms of hedge accounting established by IFRS 9, the Corporation has opted to continue
applying the hedge accounting requirements of lAS 39 instead of the requirements of the new

29
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

standard. Therefore, there were no generated effects either at the level of account balances or at
the level of disclosures.

As indicated in the note related to hedging policies in the market of metal derivatives, the
Corporation enters into operations in the market of metal derivatives. Gains and losses from those
which are fair value hedges contracts are recognized as revenues.

– — Rendering of services: Additionally, the Corporation recognizes revenue for rendering services,
which are mainly related to the processing of minerals bought from third parties. Revenue from
rendering of services is recognized when the amounts can be measured reliably and when the
services have been provided.

s) Derivative contracts – Codelco uses derivative financial instruments to reduce the risk of fluctuations
in sales prices of its products and of exchange rates.

Derivatives are initially recognized at fair value at the date the derivative contracts are entered into and
are subsequently measured to their fair value at the end of each reporting period.

The effective portion of changes in the fair value of derivatives that are designated and qualify as cash
flow hedges is recognized in other comprehensive income and accumulated in equity under the item
“Cash flow hedge reserve.” The gain or loss relating to the ineffective portion is immediately recognized
in profit or loss and included in the “Finance cost” or “Finance income” line items. Amounts previously
recognized in other comprehensive income and accumulated in equity are reclassified to profit or loss
in the periods when the hedged item affects profit or loss, in the same line as the effect for the
fluctuation in the recognized hedged item.

A hedge relationship is considered highly effective when changes in fair value or in cash flows of the
underlying item directly attributable to the hedged risk are offset by changes in fair value or cash flows
of the hedging instrument, with an effectiveness ranging from 80% to 125%. Changes in fair value
accumulated in other comprehensive income are subsequently reclassified from equity to profit or loss
in the same period or periods during which the hedged item affects profit or loss. Upon discontinuation
of hedge accounting and depending on the circumstances, the cumulative gain or loss on the hedging
instrument remains in equity until the hedged transaction occurs or, if the hedged transaction is not
expected to occur, the amount accumulated in other comprehensive income is reclassified to profit or
loss.

The total fair value of hedging derivatives ¡is classified as “non-current financial asset or liability”, if the
remaining maturity of the hedged item is greater than 12 months, and as “current financial asset or
liability”, if the remaining maturity of the hedged item is less than 12 months.

The derivative contracts held by the Corporation have been entered into to apply the risk hedging
policies and are accounted for as indicated below:

30
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

– — Hedging policies for exchange rate risk: The Corporation enters into exchange rate derivatives
to hedge exchange rate variations between the U.S. dollar and the currencies of transactions the
Corporation undertakes. In accordance with the policies established by the Board of Directors, these
hedge transactions are only entered into when there are recognized assets or liabilities, forecasts
of highly probable transactions or firm commitments. The Corporation does not enter into derivative
transactions for non-hedging purposes.

– — Hedging policies for metal market prices risk: In accordance with the policies established by the
Board of Directors, the Corporation entered into derivative contracts to reduce the inherent risks in
the fluctuations of metal prices.

The hedging policies seek to cover expected cash flows from the sale of products by fixing the sale
prices for a portion of future production. When the sales agreements are fulfilled and the derivative
contracts are settled, the results from sales and derivative transactions are offset in profit or loss in
revenue.

Hedging transactions carried out by the Corporation in the metal derivatives market are not
undertaken for speculative purposes.

– Embedded derivatives: The Corporation has established a procedure that allows for evaluation of
the existence of embedded derivatives in financial and non-financial contracts. Where there is an
embedded derivative, and the host contract is not a financial instrument and the characteristics and
risks of the embedded derivative are not closely related to the host contract, the derivative ¡is
required to be recognized separately.

t) Financial information by segment – The Corporation has defined its Divisions as its operating
segments in accordance with the requirements of IFRS 8, Operating Segments. The mining deposits in
operation, where the Corporation conducts its extractive and processing activities are managed by the
following Divisions: Chuquicamata, Radomiro Tomic, Ministro Hales, Gabriela Mistral, Salvador, Andina
and El Teniente, In addition, the smelting and refining activities are managed at the Ventanas Division.
All these Divisions have a separate operational management, which reports to the Chief Executive Officer,
through the North and South Central Vice-President of Operations, respectively. Income and expenses
of the Head Office are allocated to the defined operating segments.

u)Presentation of Financial Statements – The Corporation presents (i) its statements of financial
position classified as “current and non-current”, (ii) profit or loss or loss and other comprehensive income
in one statement and the classification of expenses within profit or loss by function, and (iii) its statement
of cash flows using the direct method.

v) Current and non-current financial assets – The Corporation determines the classification of its
financial assets at the time of initial recognition. The classification depends on the business model in
which the investments are managed and the contractual characteristics of their cash flows.

The Corporation’s financial assets are classified into the following categories:

31
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Fair value through profit or loss:

Initial recognition: This category includes those financial assets not qualifying under the categories
of Fair Value through Other Comprehensive Income or Amortized Cost. These instruments are
initially recognized at fair value.

Subsequent recognition: Their subsequent recognition is at fair value, recording in the consolidated
statement of comprehensive income, in the line “Other gains (losses)” any changes in fair value.

Amortized cost:

Initial recognition: This category includes those instruments with respect to which the objective of
the business model of the Corporation is to hold the financial instrument to collect contractual cash
flows and such cash flows consist of solely payments of principal and interest. This category
includes certain Trade and other current receivables, and the loans included in other non-current
financial assets.

Subsequent recognition: These instruments are subsequently measured at amortized cost using
the effective interest method. The amortized cost of a financial asset is the amount at which the
financial asset is measured at initial recognition minus the principal repayments, plus the cumulative
amortization using the effective interest method of any difference between that initial amount and
the maturity amount, adjusted for any impairment allowance.

Interest income is recognized in profit or loss and is calculated by applying the effective interest rate
to the gross carrying amount of a financial asset. For financial assets measured at amortized cost
that are not part of a designated hedging relationship, exchange differences are recognized in profit
or loss in the “Foreign exchange difference” line item.

At fair value through other comprehensive income:

Initial measurement: Financial assets that meet the criteria “Solely payments of principal and
interest” (SPPI) are classified in this category and must be maintained within a business model both
to collect the cash flows and to sell the financial assets. These instruments are initially recognized
at fair value.

Subsequent recognition: Their subsequent valuation is at fair value. Interest income calculated
using the effective interest rate method, foreign exchange gains and losses and impairment are
recognized in income. Other net gains and losses are recognized in other comprehensive income.
On derecognition, the gains and losses accumulated in other comprehensive income for debt
instruments are reclassified to income. Codelco did not irrevocably choose to designate any of its
investment assets at fair value with effect on other comprehensive income.

32
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

w) Financial liabilities – Financial liabilities are initially recognized at fair value net of transaction costs.
Subsequent to their initial recognition, the valuation of the financial liabilities will depend on their
classification, within which the following categories are distinguished:

Financial liabilities at fair value through profit or loss: This category includes financial
liabilities defined as held for trading.

Changes in fair value associated with own credit risk are recorded in other comprehensive
income unless doing so creates an accounting mismatch.

Financial liabilities at amortized cost: This category includes all financial liabilities other than
those measured at fair value through profit or loss.

The Corporation includes in this category bonds, obligations and other current payables.

These financial liabilities are measured using the effective interest rate method, recognizing
interest expense based on the effective rate.

The effective interest rate method is a method of calculating the amortized cost of a financial
liability and of allocating interest expense over the relevant period. The effective interest rate
is the rate that exactly discounts estimated future cash payments through the expected life of
the financial liability, or where appropriate, a shorter period, to the net carrying amount on initial
recognition.

Trade and other current payables are financial liabilities that do not explicitly accrue interest
and are recognized at their nominal value, which approximates its fair value.

Financial liabilities are derecognized when the liabilities are paid or expire.

x) Impairment of financial assets – The Corporation measures the loss allowance at an amount equal
to lifetime expected credit losses for certain of its trade receivables. For these, it uses the simplified
approach as required under IFRS 9. The Corporation considers a trade receivable to be in default at 90

days.

The provision matrix is based on an entity’s historical credit loss experience over the expected life of
such trade receivables and is adjusted for forward-looking estimates taking into account the most
relevant macroeconomic factors that affect bad debts.

Other accounts receivable and other financial assets are reviewed using reasonable and sustainable
information that is available without cost or disproportionate effort in accordance with IFRS 9 to
determine the credit risk of the respective financial assets.

33
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

y) Cash and cash equivalents and statement of cash flows prepared using the direct method – The
statement of cash flows reflects changes in cash and cash equivalents that took place during the period,
determined under the direct method. For the purposes of preparing the statement of cash flows, the
Corporation has defined the following:

– Cash flows: inflows and outflows of cash or cash equivalents, which are defined as highly liquid
investments maturing in less than three months with a low risk of changes in value.

– — Operating activities are the principal revenue-producing activities of the Corporation and other
activities that are not investing or financing activities.

– Investing activities are the acquisition and disposal of long-term assets and other investments
not included in cash equivalents.

– — Financing activities are activities that result in changes in the size and composition of net equity
and borrowings of the Corporation.

Bank overdrafts are classified as external resources in current liabilities.

z) Law No. 13196 – Law No. 13196 requires the payment of a 10% special export tax on receivables of the
sales proceeds that Codelco receives and transfers to Chile from the export of copper and related by-
products produced by Codelco. The Chilean Central Bank deducts 10% of the amounts that Codelco
transferred to its Chilean bank account. The amount recognized for this concept is presented in the
statement of income within the line item “Other expenses.” (Note 21 letter c)).

aa) Cost of sales – Cost of sales is determined according to the absorption costing method, including the
direct and indirect costs, depreciation, amortization and any other expenses directly attributable to the
production process.

ab) Classification of current and non-current balances – In the consolidated statement of financial
position, the balances are classified according to their maturities, that is, as current for those with a maturity
equal to or less than twelve months and as non-current for those with a greater maturity. Where there are
obligations whose maturity is less than twelve months, but whose long-term refinancing is insured upon a
decision by the Corporation whose intention is to refinance, through credit agreements available
unconditionally with long-term maturity, these could be classified as non-current liabilities.

ac) Non-current assets or groups of assets for disposition classified as held for sale – The
Corporation classifies as non-current assets or groups of assets for disposal, classified as held for sale,
properties, plants and equipment, investments in associates and groups subject to expropriation (group of
assets that are going to be disposed of together with their directly related liabilities), for which, at the closing
date of the financial statements, their sale has been committed to or steps have been initiated and it is
estimated that it will be carried out within the twelve months following said date. These assets or groups
subject to disposal are valued at book value or the estimated sale value minus the costs necessary for sale,
whichever is less, and are no longer amortized from the moment they are classified as non-current assets
held for sale. Non-current assets or groups of assets for disposal classified as held for sale and the

34
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

components of the groups subject to disposal classified as held for sale are presented in the consolidated
statement of financial position on a line for each of the following concepts: “Non-current assets or groups of
assets for disposition classified as held for sale” and/or “Non-current liabilities or groups of liabilities for
disposition classified as held for sale.”

New standards and interpretations adopted by the Corporation

The accounting policies adopted in the preparation of the interim consolidated financial statements are
consistent with those applied in the preparation of the Corporation’s annual consolidated financial
statements for the year ended December 31, 2019, except for the adoption of new standards, interpretations
and amendments, effective from January 1, 2020, which are:

a) Definition of a Business (Amendments to IFRS 3)

The amendments clarify that while businesses usually have outputs, outputs are not required for an
integrated set of activities and assets to qualify as a business. To be considered a business an
acquired set of activities and assets must include, at a minimum, an input and a substantive process
that together significantly contribute to the ability to create outputs.

Additional guidance ¡is provided that helps to determine whether a substantive process has been
acquired.

The amendments introduce an optional concentration test that permits a simplified assessment of
whether an acquired set of activities and assets is not a business. Under the optional concentration
test, the acquired set of activities and assets is not a business if substantially all of the fair value of the
gross assets acquired is concentrated in a single identifiable asset or group of similar assets.

The application of these amendments has not had any material impact on the Corporation’s
consolidated financial statements.

b) Definition of Material (Amendments to IAS 1 and IAS 28)

The amendments are intended to make the definition of material in lAS 1 easier to understand and are
not intended to alter the underlying concept of materiality in IFRS Standards. The concept of
“obscuring’ material information with immaterial information has been included as part of the new
definition.

The threshold for materiality influencing users has been changed from “could influence” to “could
reasonably be expected to influence”.

The definition of material in lAS 8 has been replaced by a reference to the definition of material in IAS
1. In addition, the lASB amended other Standards and the Conceptual Framework that contain a
definition of material or refer to the term ‘material’ to ensure consistency.

The application of these amendments has not had any material impact on the Corporation’s
consolidated financial statements.

35
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

c) Revised Conceptual Framework for Financial Reporting

On March 29, 2018, the lASB published its revised “Conceptual Framework for Financial Reporting”
(the “Framework”). The Conceptual Framework is not a standard and none of the concepts override
those in any standard or any requirements in a standard. The main purpose of the Framework is to
guide the lASB when it develops International Financial Reporting Standards. The Framework can also
be helpful for preparers of financial statements when there are no specific or similar standards that
address a particular issue. The new Framework has an introduction, eight chapters and a glossary.
Five of the chapters are new or have been revised substantially.

The new Framework:

e Introduces a new asset definition that focuses on rights and a new liability definition that is
likely to be broader than the definition it replaces but does not change the distinction between
a liability and an equity instrument.

e Removes from the asset and liability definitions references to the expected flow of economic
benefits—this lowers the hurdle for identifying the existence of an asset or liability and puts
more emphasis on reflecting uncertainty in measurement.

e Discusses historical cost and current value measures and provides some guidance on how the
|ASB would go about selecting a measurement basis for a particular asset or liability.

e States that the primary measure of financial performance is profit or loss, and that only in
exceptional circumstances will the |ASB use other comprehensive income and only for income
or expenses that arise from a change in the current value of an asset or liability.

e Discusses uncertainty, derecognition, unit of account, the reporting entity and combined
financial statements.

In addition, the lASB published a separate document “Updating References to the Conceptual
Framework” which contains consequential amendments to affected Standards so that they refer to the
new Framework.

The application of these amendments has not had any material impact on the Corporation’s
consolidated financial statements.

d) Interest Rate Benchmark Reform (Amendments to IFRS 9, IAS 39 and IFRS 7)

The amendments deal with issues affecting financial reporting in the period before the replacement of
an existing interest rate benchmark with an alternative interest rate and address the implications for
specific hedge accounting requirements in IFRS 9 Financial Instruments and lAS 39 Financial
Instruments: Recognition and Measurement, which require forward-looking analysis. (IAS 39 is
amended as well as IFRS 9 because entities have an accounting policy choice when first applying
IFRS 9, which allows them to continue to apply the hedge accounting requirements of lAS 39). There
are also amendments to IFRS 7 Financial Instruments: Disclosures regarding additional disclosures
around uncertainty arising from the interest rate benchmark reform.

36
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The changes in Interest Rate Benchmark Reform (Amendments to IFRS 9, IAS 39 and IFRS 7): (i)
modify specific hedge accounting requirements so that entities would apply those hedge accounting
requirements assuming that the interest rate benchmark on which the hedged cash flows and cash
flows from the hedging instrument are based will not be altered as a result of interest rate benchmark
reform; (il) are mandatory for all hedging relationships that are directly affected by the interest rate
benchmark reform; (iii) are not intended to provide relief from any other consequences arising from
interest rate benchmark reform (if a hedging relationship no longer meets the requirements for hedge
accounting for reasons other than those specified by the amendments, discontinuation of hedge
accounting ¡is required); and (iv) require specific disclosures about the extent to which the entities’
hedging relationships are affected by the amendments.

The application of these amendments had no material impact on the consolidated financial statements
of the Corporation, however it could affect the accounting of future transactions or agreements.

e) COVID 19-related Rent Concessions (amendments to IFRS 16)

The COVID-19 pandemic has led to some lessors providing relief to lessees by deferring or relieving
them of amounts that would otherwise be payable. In some cases, this is through negotiation
between the parties, but can be as a consequence of a government encouraging or requiring that the
relief be provided. Such relief is taking place in many jurisdictions in which entities that apply IFRSs
operate.

When there is a change in lease payments, the accounting consequences will depend on whether that
change meets the definition of a lease modification, which IFRS 16 defines as “a change in the scope

of a lease, or the consideration for a lease, that was not part of the original terms and conditions of the
lease (for example, adding or terminating the right to use one or more underlying assets, or extending

or shortening the contractual lease term)”.

It incorporates some clarifications regarding contract modifications in the context of the COVID-19
pandemic.

1. Provide exception to lessees, to assess whether the lease concession related to COVID-19 is a
modification of the lease;

2. Allows lessees to apply the exception to account for a lease concession related to COVID-19 as if it
were not a modification to the lease;

3. Requires lessees who apply the exception to disclose that fact; and

4. Requires lessees to apply said exception retrospectively under lAS 8, but does not require
restatement of figures from previous periods.

The application of these amendments has not had any material impact on the Corporation’s
consolidated financial statements.

37
CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

f) Reclassifications:

The Company has made immaterial reclassifications to ¡ts statement of financial position as of

December 31, 2019:

Reclassification in TRUS$ 12/31/2019 Reclassification 12/31/2019

New Presentation
Non-current asset
Property, Plant and equipment 29,700,164 (432,152) 29,268,012
Right-ofuse assets – 432,152 432,152
Current liabilities
Other current financial liabilites 1,378,351 (127,761) 1,250,590
Current lease liabilities 127,761 127,761
Non-current liabilities
Other non-current financial liabilites 16,538,223 (305,110) 16,233,113
Non-current lease liabilities 305,110 305,110

Certain changes to disclosure in certain notes have also been made which have been deemed

immaterial by Management.

New accounting pronouncements

a)

application is not yet mandatory:

The following new standards, amendments and interpretations had been issued by the lASB, but their

New IFRS Date of mandatory application Summary
Establishes the principles for the
IFRS 17, Insurance Contracts Annual periods beginning on or after | recognition, measurement,
January 1, 2023 presentation and disclosure of
insurance contracts, reinsurance

contracts and investment contracts
with discretional participating features
and supersedes IFRS 4 Insurance
contracís.

Amendments to IFRS

Date of mandatory application

Summary

Classification of Liabilities as
Current or Non-Current
(Amendments to lAS 1)

Annual periods beginning on or after
January 1, 2023

The amendments aim to promote
coherence in the applying the
requirements by helping
companies to determine whether,
in the statement of financial
position, debts and other liabilities
with an uncertain settlement date
must classified as current (expired
or potentially expired in one year)
or not current. lt is important to
note that they must be applied
retrospectively and early
application is permitted.

38

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Reference to the Conceptual
Framework (Amendments to
IFRS 3)

Annual periods beginning on or after
January 1, 2022.

Reference to Conceptual Framework
2018 instead of 1989. Additionally, for
transactions within the scope of lAS 37
or IFRIC 21, an acquirer will apply IAS
37 or IFRIC 1 (instead of Conceptual
Framework) to identify liabilities
assumed in a business combination.
Finally, a statement is added so that
an acquirer does not recognize
contingent assets acquired in a
business combination.

Property, Plant and Equipment
– Proceeds before Intended
Use (Amendments to IAS 16)

Annual periods beginning on or after
January 1, 2022.

The income and costs from the
sale of items produced while the
asset is taken to the location and
necessary condition of operation
foreseen by the administration, are
recognized in results.

Onerous Contracts – Costs of
Fulfilling a Contract
(Amendments to lAS 37)

Annual periods beginning on or after
January 1, 2022.

It is specified that the cost of
fulfilling a contract includes “costs
that are directly related to the
contract”, which are those that
either may be incremental costs of
fulfilling that contract or an
allocation of other costs that are
directly related to fulfill the
contracts.

Extension of the temporary
exemption from the application
of IFRS 9 (amendments to
IFRS 4)

Annual periods beginning on or after
January 1, 2023.

The termination date for the
temporary exemption established
in IFRS 4 “Insurance Contracts” is
modified on the application of IFRS
9. It may be as of January 1, 2023.

Reform to the Reference
Interest Rate (IBOR) – Phase 2
(amendments to IFRS 9, IAS
39, IFRS 7, IFRS 4 and IFRS
16)

Annual periods beginning on or after
January 1, 2021.

It introduces a practical guide to
address the modifications
proposed in the IBOR reform,
indicating, among others, that
hedge accounting is not
discontinued due to the mere
appearance of the reform in
question.

39

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Annual Improvements to IFRS
Standards 2018-2020
(amendments to IFRS 1, IFRS
9, IFRS 16 and IAS 41)

Annual periods beginning on or after
January 1, 2022.

IFRS 1 First-time Adoption of IFRS:
Allows an affillate to apply
paragraph D16 (a) to measure
cumulative translation differences
using the amounts reported by its
parent, based on the date of
transition to IFRS from its parent.

IFRS 9 Financial Instruments:
clarifies what fees are included
when applying the “10 percent” test
in paragraph B3.3.6.

IFRS 16 Leases: removes from
Illustrative Example 13, the
illustration of the reimbursement of
improvements to the leased asset
made by the lessor.

¡AS 41 Agriculture: removes the
requirement in paragraph 22 to
exclude tax cash flows when
measuring the fair value of a
biological asset using the present
value technique.

The Administration is evaluating the impact of the adoption of these new regulations and modifications.

EXPLANATORY NOTES

Cash and cash equivalents

The detail of cash and cash equivalents as of September 30, 2020 and December 31, 2019, ¡is as follows:

ltem 9/30/2020 12/31/2019
ThUS$ ThUS$

Cash on hand 167 261
Bank balances 834,834 262,336
Time deposits 2,605,459 972,125
Mutual Funds – Money Market 11,882 2,158
Repurchase agreements 1,547 66,225
Total cash and cash equivalents 3,453,889 1,303,105

Interest on time deposits is recognized on an accrual basis using the contractual interest rate of each of

these instruments.

40

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The Corporation does not hold any significant amounts of cash and cash equivalents that have a restriction
on use.

Cash and cash equivalents meet the low credit risk exemption under IFRS 9.

Trade and other receivables

a)

Accruals for open sales invoices

As mentioned in the Summary of Significant Accounting Policies Section, the Corporation adjusts ¡ts
revenues and trade receivable balances, based on future copper prices through the recognition of an
accrual for open sales invoices.

When future price of copper is lower than the provisional invoicing price, the accrual is presented in the
statement of financial position as follows:

– For those customers that have due balances with the Corporation the accrual is presented as a
deduction from the line item trade and other current receivables.

– For those customers that do not have due balances with the Corporation the accrual is presented
in the line item trade and other current payables.

When the future copper price is higher than the provisional invoicing price, the accrual is added to the
line item trade and other current receivables.

According to the foregoing, as of September 30, 2020, a positive amount is presented in the trade and
other current receivable of ThUS$211,646 for as-yet finalized sales invoicing.

As of December 31, 2019, a positive provision of TRUS$98,045 was recorded in the trade debtors
account and other accounts receivable for as-yet finalized sales invoicing.

Trade and other receivables

The following table sets forth trade and other receivables balances, with their corresponding
allowances for doubtful accounts:

41
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Current Non-Current
Items 9/30/2020 12/31/2019 | 9/30/2020 12/31/2019
ThUS$ ThUS$ ThUS$ ThUS$
Trade receivables (1) 1,771,312 1,934,245 416 438
Allowance for doubtful accounts (3) (8,313) (7,530) – –
Subtotal trade receivables, net 1,762,999 1,926,715 416 438
Other receivables (2) 578,416 668,218 90,744 98,106
Allowance for doubtful accounts (3) (7,428) (6,665) – –
Subtotal other receivables, net 570,988 661,553 90,744 98,106
Total 2,333,987 2,588,268 91,160 98,544

(1) Trade receivables correspond to the sales of copper and its by-products, those that in general
are sold in cash or through bank transfers.

(2) Other receivables mainly consist of the following items:

» Corporation’s employee short-term loans and mortgage loans, both monthly deducted from
the employee’s salaries. Mortgage loans granted to the Corporation’s employees for
ThUS$35,431 are secured with collateral.

+ Reimbursement receivables from insurance companies.

+ Advance payments to suppliers and contractors.

+ Accounts receivable for tolling services (Ventanas Smelter).

+ VAT credit and other refundable taxes of ThUS$146,544 and ThUS$179,486 as of
September 30, 2020 and December 31, 2019, respectively.

(3) The Corporation recognizes an allowance for doubtful accounts based on its expected credit
loss model.

The reconciliation of changes in the allowance for doubtful accounts for the nine-month periods ended
September 30, 2020 and for the year ended December 31, 2019, were as follows:

ltems 9/30/2020 12/31/2019
ThUS$ ThUS$
Opening balance 14,195 42,657
Net Increases 2,161 1,709
Write-offs/applications (615) (30,171)
Total movements 1,546 (28,462)
Closing balance 15,741 14,195

42
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

3.

As of September 30, 2020 and December 31, 2019, the balance of past due but not impaired trade
receivables, is as follows:

Maturity 9/30/2020 12/31/2019
ThUs$ ThUS$
Less than 90 days 11,451 9,510
Between 90 days and 1 year 2,816 1,211
More than 1 year 9,929 9,530
Total trade receivables past-due but not impaired 24,196 20,251

Balance and transactions with related parties

a) Transactions with related persons

In accordance with Law on New Corporate Governance, the members of Codelco’s Board are, in terms
of transactions with related persons, subject to the provisions of Title XVI of Law on Corporations,
which sets the requirements regarding transactions with related parties in publicly traded companies
and their subsidiaries.

Notwithstanding the foregoing, pursuant to the provisions of the final paragraph of Article 147 b) of Title
XVI, which contains exceptions to the approval process for transactions with related parties, the
Corporation has established a general policy over customary transactions (which was communicated
through a significant event notice to the CMF), that defines customary transactions as those carried
out with its related parties in the normal course of business, which contributes to the social interest and
are necessary to the normal development of Codelco’s activities.

Likewise, consistent with the referred to above standard, the Corporation has implemented as part of
its internal regulatory framework, a specific policy dealing with business between related persons and
companies with Codelco’s executives. Codelco’s Corporate Policy No.18 (“CCP No. 18”), the latest
version currently in force, was approved by the Chief Executive Officer and the Board of Directors.

Accordingly, Codelco without the authorization required in CCP No. 18 and of the Board of Directors,
as required by Law or by the Corporation by-laws, shall not enter into any contracts or agreements
involving one or more Directors, its Chief Executive Officer, the members of Division’s Managing
Committees, Vice-presidents, Legal Counsel, General Auditor, Division Chief Executive Officers,
Advisors of Senior Management, employees who must make recommendations and/or have the
authority to award tenders, assignments of purchases and/or contracting goods and services, and
employees in management positions (up to fourth hierarchical level in the organization), including their
spouses, children and other relatives up to second degree of relation, with a direct interest, represented
by third parties or on behalf of another person. Likewise, CCP No. 18 requires administrators of
Corporation’s contracts to declare all related persons and disqualify himself/herself if any related
persons are involved within the field of his/her job responsibilities.

43
CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

This prohibition also includes the companies in which such administrators are involved through
ownership or management, either directly or through representation of other natural persons or legal
entities, as well as those individuals who also have ownership or management in those companies.

The Board of Directors has been informed and approved certain transactions as defined in CCP No.

18.

The most significant transactions with related persons and the amounts involved are detailed in the

following table:

1/1/2020 1/1/2019 7/1/2020 7/1/2019
Entity Taxpayer number | Country Nature of the Description of the 9/30/2020 9/30/2019 9/30/2020 9/30/2019
relationship transaction Amount Amount Amount Amount
ThUS$ Thus$ ThUS$ Thus$
‘ADM Planning Consultores Lida 77.770.490-7 Chile [Employee’s relative Services 881 -. . –
Anglo American Sur S.A. 77.762.940-9 Chile [Associate Supplies 5 16 5
B.Bosch S.A. 84.716.400-K Chile [Employee’s relative Supplies . 3,618 .
Centro de Capacitación y Recreación Radomiro Tomic. 75.985.550-7 Chile [Other related Services . 62 .
Clariant (Chile) Lida. 80.853.400-2 Chile [Employee’s relative Supplies 38,873 -. 38,873 –
Ecometales Limited agencia en Chile. 59.087.530-9 Chile [Subsidiary Services . 43,495 43,495
Fismidth S.A. 89.664.200-6 Chile [Employee’s relative Supplies 4,012 1,265 1,873 1,258
Fundación de Salud El Teniente. 70.905.700-6 Chile [Subsidiary Services 22,030 -. 22,030 –
Fundacion Educacional de Chuquicamata. 72.747.300-9 Chile [Founder member donor Services . 134 .
Fundación Orquesta Sinfónica Infantl de los Andes. 65.018.784-9 Chile [Founder member donor Services . 270 .
Highservice ingeniería y construcción ltda. 76.378.396-0 Chile [Employee’s relative Services 13,984 680 13,984
Industrial Support Company Lida 77.276.280-1 Chile [Employee’s relative Services . 22,691 .
Industrial y Comercial Artimatemb Lida. 76.108.720-7 Chile [Employee’s relative Services . 20 .
Ingeniería de Protección SpA 89.722.200-0 Chile [Employee’s relative Supplies 7 -. 7
Institución de Salud Previsional Chuquicamata Lida. 79.566.720-2 Chile [Subsidiary Services . 3,257 .
Komatsu Chile S.A. 96.843.130-7 Chile [Employee’s relative Services and supplies 878 10,729 51 –
Linde Gas Chile S.A. 90.100.000-K Chile [Employee’s relative Supplies 23 124 8 48
Marsol S.A. 91.443.000-3 Chile [Employee’s relative Supplies . 94 10
Prestaciones de Servicios de la Salud Intersalud Ltda. 77.270.020-2 Chile [Subsidiary Services 596 -. 596 –
Servicios de Ingeniería IMA S.A. 76.523.610-K Chile [Employee’s relative Services 25 -. . –
Soc. de Prod. y Serv. Solava Ltda 78.663.520-9 Chile [Employee’s relative Supplies . 57 . –
¡Sociedad Contractual Minera El Abra. 96.701.340-4 Chile [Associate Supplies 73 . –
¡Sodimac S.A. 96.792.430-K Chile [Employee’s relative Supplies . 1,644 . 1
Sonda S.A. 83.628.100-4 Chile [Employee’s relative Services 50 221 14 –
¡Suez Medioambiente Chile S.A. 77.441.870-9 Chile [Employee’s relative Supplies 4,261 57 .

b)

Key Management of the Corporation

In accordance with the policy established by the Board of Directors and its related regulations, the
transactions with the Directors, the Chief Executive Officer, Vice Presidents, Corporate Auditor, the
members of the Divisional Management Committees and Divisional General Managers shall be
approved by the Board of Directors.

During the nine month and three month periods ended September 30, 2020 and 2019 , the members
of the Board of Directors have received the following amounts as per diems, salaries and fees:

44

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

1/1/2020 1/1/2019 7/1/2020 7/11/2019
Name Taxpayer number | Country Nature of the Description of 9/30/2020 9/30/2019 9/30/2020 9/30/2019
relationship the transaction Amount Amount Amount Amount
ThUS$ ThUS$ ThUS$ ThUS$
Blas Tomic Errázuriz 5.390.891-8 Chile [Director Directors’s fees 72 89 22 29
Ghassan Dayoub Pseli 14.695.762-5 Chile [Director Directors’s fees 57 71 17 23
Ghassan Dayoub Pseli 14.695.762-5 Chile [Director Payroll 86 102 26 21
Hernán de Solminihac Tampier 6.263.304-2 Chile [Director Directors’s fees 57 71 17 23
Ignacio Briones Rojas 12.232.813-9 Chile [Director Directors’s fees – 71 – 23
Isidoro Palma Penco 4.754.025-9 Chile [Director Directors’s fees 57 71 17 23
Juan Benavides Feliú 5.633.221-9 Chile [Chairman ofthe board [Directors’s fees 86 106 26 34
Juan Morales Jaramillo 5.078.923-3 Chile [Director Directors’s fees 57 71 17 23
Paul Schiodtz Obilinovich 7.170.719-9 Chile [Director Directors’s fees 57 71 17 23
Raimundo Espinoza Concha 6.512.182-4 Chile [Director Directors’s fees 27 71 – 23
Raimundo Espinoza Concha 6.512.182-4 Chile [Director Payroll 13 27 – 7
Rodrigo Cerda Norambuena 12.454.621-4 Chile [Director Directors’s fees 54 – 17 –

The Ministry of Finance through Supreme Decree No. 261, dated February 27, 2020, established the
compensation for the Corporation’s Directors. The compensation to Board of Director members, is as

follows:

The Directors of Codelco will receive a fixed monthly compensation of Ch$4,126,340 (four million
one hundred and twenty six thousand, three hundred and forty Chilean pesos) for meeting
attendance. The payment of the monthly compensation requires at least one meeting attendance
each month.

The Chairman of the Board will receive a fixed monthly compensation of Ch$8,252,678 (eight
million two hundred and fifty two thousand, six hundred and seventy eight Chilean pesos).

Each member of the Directors’ Committee, whether the one referred to in Article 50 bis) of Law
No. 18046 or another established by the Corporation by-laws, will receive a fixed additional
monthly compensation of Ch$1,375,445 for meeting attendance, regardless of the number of
committees of which they are members. In addition, the Chairman of the Directors’ Committee will
receive a fixed monthly compensation of Ch$2,750,893 for meeting attendance.

By means of Ordinary Official Letter N ? 1611 of July 8, 2020, it is reported that due to the current
situation that the country is going through, and in line with what was requested by Codelco and
what was reported by the Director of the Budget, it has been considered conducive to decrease
by a 20% the amount of directors’ remuneration, exceptionally, for the period between July and
December 2020, both included.

The compensation established in the legal text is effective for a period of two years, as from March
1, 2020, and will not be adjusted during said period.

On the other hand, the short-term benefits of key management of the Corporation paid during the

nine month period ended September 30, 2020 and 2019, were ThUS$9,094 and ThUS$9,696,
respectively.

45
CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

c)

The methodology to determine the remuneration of key management was approved by the Board
of Directors at a meeting held on January 29, 2003.

During the nine month period ended September 30, 2020 and 2019, severance indemnities were
paid to key management of the Corporation for ThUS$177 and ThUS$1,660, respectively.

There were no payments to key management for other non-current benefits during the nine month
period ended September 30, 2020 and 2019.

There are no share based payment plans granted to Directors or key management personnel of
the Corporation.

Transactions with companies in which Codelco has ownership interest

The Corporation undertakes commercial and financial transactions that are necessary for ¡ts activities
with its subsidiaries, associates and joint ventures (“related parties”). The financial transactions

correspond mainly to loans granted (mercantile current accounts).

Commercial transactions with related companies mainly consist of purchases/sales of products or
rendering of services carried out under market conditions and prices, which do not bear any interest or

indexation.

As of the date of these financial statements, the Corporation has not recognized any allowance for
doubtful accounts with respect to receivable balances from its related companies.

The detail of accounts receivable and payable between the Corporation and its related parties as of
September 30, 2020 and December 31, 2019, is as follows:

Accounts receivable from related companies:

Taxpayer Nature of the | Indexation Current Non-current
MA Name Country relationship | currency 9/30/2020 12/31/2019 9/30/2020 12/31/2019
ThUS$ ThUS$ ThUS$ ThUS$
77.762.940-9 [Anglo American Sur S.A. Chile Associate US$ 15,669 16,677 – –
76.063.022-5 |Inca de Oro S.A. Chile Associate US$ 481 438 – –
76.255.054-7 |Planta Recuperadora de Metales SpA | Chile Associate US$ 289 1,677 12,970 15,370
96.701.340-4 | Sociedad Contractual Minera El Abra Chile Associate US$ 5,079 2,077 – –
96.801.450-1 |Agua de la Falda S.A. Chile Associate US$ 5 5 224 224
Totals 21,523 20,874 13,194 15,594
Accounts payable to related companies:
s Current Non-current
Tapayor Name Country e an 9/30/2020 | 12/31/2019 | 9/30/2020 | 12/31/2019
ThUus$ ThUuS$ Thus$ ThUus$
77.762.940-9 [Anglo American Sur S.A. Chile Associate US$ 132,793 108,243 – –
96.701.340-4 [Sociedad Contractual Minera El Abra Chile Associate US$ 23,606 26,608
76.255.054-7 [Planta Recuperadora de Metales SpA Chile Associate US$ 2,421 430
76.781.030-K_|Kairos Mining S.A. Chile Associate CLP 567. 1,953

Totals

159,387

137,234

46

CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The following table sets forth the transactions carried out between the Corporation and its related
companies and their corresponding effects in profit or loss for the nine month and three month periods
ended September 30, 2020 and 2019:

1/1/2020 11112019 71112020 712019
9/30/2020 9/30/2019 9/30/2020 9/30/2019
Taxpayer Nature ofthe Index. Effects on net Effects on net Effects on net Effects on net
Entity Country Amount | income (charges) | Amount [income (charges)/| Amount [income (charges) /| Amount [income (charges) /|
number transaction Currency .
credits credits credits credits
ThUS$ RUSS RUSS RUSS RUSS RUSS RUSS RUSS

96.801.450-1 |Agua de la Falia SA. Sales ofservices Chie | CLP 1 1 3 3 – 1 1
96.801.450-1 |Agua de la Falda SA [contribution Chie | US$ 176 – 190 – –
77.762.940-9 Anglo American Sur S.A. Dividends received Chie | US$ 22,715 -| 84,372 – – –
77.762.940-9 | Anglo American Sur S.A. Sales of goods Chie | US$ 34,208 34,208 8,932 8,932 | 33,052 33,052
77.762.940-9 | Anglo American Sur S.A. Sales of services Chie | CLP 12,885 12,885 4,279 4,279 6,625 6,625 – –
77.762.940-9 | Anglo American Sur S.A. Purchase ofproducs Chie | US$ 447,693 (447,693) | — 475,497 (475,497) | — 207,090 (207,090)| 125,504 (125,504)
76.063.022-5 Inca de Oro S.A. Sales of services Chie | CLP 64 – 39 1 15 – 3 3
77.761.030-K Kairos Mining Services Chie | CLP 7,979 (7979)| — 16,487 (16,487)| 2,833 (2833)| — 5465 (5,465)
77.761.030-K Kairos Mining Sales of services Chie | CLP 2 2 2 2 – –
76.255.054-7 Planta Recuperadora de Metales SpA. |Interestloans Chie | US$ 773 773 TIO TIO 263 263 260 260
76.255.054-7 Planta Recuperadora de Metales SpA. [Services Chie | US$ 17,514 (17,514)| — 14,477 (14,477)| — 5,888 (5888)| — 2,866 (2,866)
76.255.054-7 | Planta Recuperadora de Metales SpA [Sales of services Chie | CLP – – 4,695 4,695 – – – –
76.255.054-7 [Planta Recuperadora de Metales SpA. [Sales ofgoods Chie | CLP st 5t 37 37 22 22 2 2
76.255.054-7 [Planta Recuperadora de Metales SpA. |Loan recovery Chie | US$ 2.500 – – – – – – –
96.701.340-4 Soc. Contractual Minera El Abra Purchase ofproducs Chie | US$ 152,823 (152,823)| 172,278 (172,278)| — 53,574 (53,574)| — 64,485 (64,485)
96.701.340-4 | Soc. Contractual Minera El Abra Sales of goods Chie | US$ 13,799 13,799 | — 24,472 24,472 1,511 151 | 12,028 12,028
96.701.340-4 Soc. Contractual Minera El Abra Oher sales Chie | US$ 373 373 1,120 1,120 – 374 374
96.701.340-4 Soc. Contractual Minera El Abra Perceived commissions | Chie | US$ 74 74 7 7 49 49 28 28
96.701.340-4 |Soc. Contractual Minera El Abra [other purchases Chie_| US$ – 39 (39) – – –

d) Additional information

The current account receivable from Planta Recuperadora de Metales SpA. corresponds to the loan
agreement granted to build its plant, which was signed on July 7, 2014.

The purchase/sales of products transactions with Anglo American Sur S.A., are regular business
activity transactions to buy/sell copper and other products. On the other hand, there are certain
transactions related to the contract entered into with the subsidiary Inversiones Mineras Nueva Acrux
SpA (whose non-controlling shareholder is Mitsui) and Anglo American Sur S.A., under which the latter
agreed to sell a portion of its annual copper output to said subsidiary.

Inventories

The detail of inventories as of September 30, 2020 and December 31, 2019, is as follows:

Current Non-current
Items 9/30/2020 12/31/2019 9/30/2020 12/31/2019
ThUS$ ThUS$ ThUS$ ThUS$
Finished products 152,466 210,309 – –
Subtotal finished products, net 152,466 210,309 – –
Products in process 1,281,746 1,150,060 568,836 585,681
Subtotal products in process, net 1,281,746 1,150,060 568,836 585,681
Material in warehouse and other 772,670 723,264 – –
Obsolescence allowance adjustment (178,600) (162,498) – –
Subtotal material in warehouse and other, net 594,070 560,766 – –
Total Inventories 2,028,282 1,921,135 568,836 585,681

47

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The amount of inventories of finished goods transferred to cost of sales for the nine month period ended
September 30, 2020 and 2019 was ThUS$7,284,723 and ThUS$7,222,309, respectively.

For the nine month period ended September 30, 2020 and 2019, the Corporation has not reclassified
inventories to Property, Plant and Equipment.

The reconciliation of changes in the allowance for obsolescence ¡s detailed below:

: 9/30/2020 | 12/31/2019
Changes in Allowance for Obsolescence ThUS$ ThUS$
Opening Balance (162,498) (96,805)
Period provision (16,102) (65,693)
Closing Balance (178,600) (162,498)

During the nine-month periods ended September 30, 2020 and 2019, the Corporation recognized write-off
of damaged inventories of TRUS$963 and ThUS$7,178, respectively.

As of September 30, 2020, the inventory provision to reduce inventory to ¡ts net realizable provision was
ThUS$23,730 with a credit effect for the period of January – September of 2020 of ThUS$14,414 (charge
for the corresponding period of 2019 was ThUS$53,944). As of December 31, 2019, the inventory
provision to reduce inventory to ¡ts net realizable provision was ThUS$38,144,

As of September 30, 2020 and 2019, there are no unrealized gains or losses recognized on the
intercompany sales of inventories of finished products.

As of September 30, 2020 and 2019, there are no inventories pledged as security for liabilities.
Income taxes and deferred taxes

a) Composition of income tax expense:

1/1/2020 1/1/2019 7/1/2020 7/1/2019
Items 9/30/2020 9/30/2019 9/30/2020 9/30/2019
ThUS$ ThUS$ ThUS$ ThUS$
Current income tax (21,119) (6,572) (18,588) (2,404)
Effect of Deferred Taxes (336,172) (12,310) (319,472) (52,563)
Adjustments to current tax from the prior period (9,253) – (9,253) –
Other 5,496 (1,617) (416) (22)
Total tax expense (361,048) (20,499) (347,729) (54,989)

48
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

b) Deferred tax assets and liabilities:

The following table details deferred tax assets and liabilities:

Deferred tax assets 9/30/2020 12/31/2019

ThUS$ ThUS$
Provisions 1,424,630 1,556,662
Rigth-ofuse contracts 1,502 4,808
Tax loss carryforwards 980,262 613,340
Other 7,857 2,906
Total deferred tax assets 2,414,251 2,177,716

Deferred tax liabilities 9/30/2020 12/31/2019

ThUsS$ ThUS$
Tax on mining activity 271,615 235,931
Property, plant and equipment variations 1,421,923 1,386,874
Post-employment benefit obligations 13,745 14,676
Accelerated depreciation for tax purposes 5,645,389 5,198,975
Fair value of mining properties acquired 108,518 108,518
Hedging derivatives — future contracts 11,831 14,889
Undistributed profits of subsidiaries 36,524 34,998
Total deferred tax liabilities 7,509,545 6,994,861

The following tables sets forth the deferred taxes as presented in the statement of financial position:

Deferred taxes 9/30/2020 12/31/2019
ThUS$ ThUS$
Non-current assets 46,157 43,736
Non-currentliabilities 5,141,451 4,860,881
Net 5,095,294 4,817,145

c) The effects of deferred taxes recorded in other comprehensive income are as follows:

Deferred taxes on components of other comprehensive 9/30/2020 9/30/2019

income ThUS$ ThUS$
Credit /(Debit) | Credit /(Debit)

Cash flow hedge 40,197 26,351

Defined Benefit Plans 1,506 7,349

Total deferred tax effect on components of other

a 41,703 33,700
comprehensive income

49
CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

d) The following table sets forth the reconciliation of the effective tax rate:

9/30/2020
Reconciliation of tax rate Taxable Base At the Tax rate
25.0% 40.0% 5% 25.0% 40.0% 5% Total
ThUus$ | ThUs$ ThUS$ ThUS$ ThUS$ | ThUS$ | ThUus$
Tax efíecton the income (loss) before taxes 427,508 427,508 427,508 (106,877) (171,003) (21,375) (299,255)
Tax effecton the income (loss) before taxes of subsidiaries 5,463 5,463 5,463 (1,366) (2,185) (273) (3,824)
Tax efect consolidated profit (loss) before taxes 432,971 432,971 432971 (108,243) (173,188) (21,648) (303,079)
Permanent differences:
First category income tax (25%) 9,921 (2,480) (2,480)
Specific tax for state-owned entities Art 2 D.L. 2398 (40%) 33,998 (13,599) (13,599)
Specific tax on mining activities 627,967 (31,398) (31,398)
Single Tax Art 21 Inc. N*1 (1,238)
Diferences tax prevous years (9,254)
TOTAL TAX EXPENSE (110,723) (186,787) (53,046) (361,048)
9/30/2019
R iliati F Taxable Base At the Tax rate
econciliation of tax rate 25.0% | 40.0% | 5% 25.0% | 40.0% | 5% | Total
ThUuS$ | ThuS$ ThUs$ ThUs$ ThUS$ | ThUuS$ | ThUS$
Tax efíecton the income (loss) before taxes (83,550) (83,550) (83,550) 20,888 33,420 4,178 58,486
Tax effecton the income (loss) before taxes of subsidiaries 6,050 6,050 6,050 (1,513) (2,420) (303) (4,236)
Tax effect consolidated profit (loss) before taxes (77,500) (77,500) (77,500) 19,375 31,000 3,875 54,250
Permanent differences:
First category income tax (25%) 81,633 (20,408) (20,408)
Specific tax for state-owned entities Art 2 D.L. 2398 (40%) 46,318 (18,527) (18,527)
Specific tax on mining activities 641,811 (32,091) (32,091)
Single Tax Art 21 Inc. N*1 (2,106)
Others (1,617)
TOTAL TAX EXPENSE (1,033) 12,473 (28,216) (20,499)

Pursuant to Article 2 of the Decree Law 2398, Codelco is subject to an additional tax rate of 40% on
income before taxes and dividends received in accordance with the law.

For the calculation of deferred taxes, the Corporation has applied a General Tax Regime, with first-rate
tax rates for the 2020 and 2019 business years of 25%. As a state company, the Corporation ¡is
classified as those companies of article 14 letter G of the Income Tax Law, incorporated in the Tax
Reform Law No. 21,210 of February 24, 2020, maintaining the General Regime of Taxation. Meanwhile,
the national subsidiaries and associates, by default, have applied the Partially Integrated Taxation
system with a rate of 27% for both years. Foreign subsidiaries and associates have applied the tax

rates in force in their respective countries.

In relation to the specific tax on mining activities the tax rate applicable is 5% under Law No. 20469.

The Corporation, as a Taxpayer of first category, is liable to the single Tax of 40%, contained in the
first paragraph of Article 21 ofthe Income Tax Law No. 824, in numbers i), li) and iii) , the disbursements

incurred in said numerals.

50

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

6. Current and non-current tax assets and liabilities

The current tax balance is presented net of monthly provisional payments as an asset or liability in Current
Taxes, as the case may be, determined as indicated in section II. Main accounting policies, 2.1):

Current Tax Assets 9/30/2020 12/31/2019

ThUS$ ThUS$
Taxes to be recovered 55,039 22,719
Total Current Tax Assets 55,039 22,719

Current Tax Liabilities 9/30/2020 12/31/2019

ThUS$ ThUS$
Monthly Provisional Payment Provision 1,121 10,672
Provision Tax 3,018 3,185
Total Current Tax Liabilities 4,139 13,857
ltems 9/30/2020 12/31/2019

ThUS$ ThUS$
Non-Current Tax Assets 173,013 222,169
Total Non-Current Tax Assets 173,013 222,169

Non-current recoverable taxes correspond to advance tax payments made provisionally and which are
probable of realization through utilization on future income tax returns. These non-current recoverable taxes
are not expected to be realized in the current period. The Corporation has tax loss carryforwards of
ThUS$1,429,467.

7. Property, Plant and Equipment

a) The items of property, plant and equipment as of September 30, 2020 and December 31, 2019, are as

follows:

: 9/30/2020 12/31/2019
Property, Plant and Equipment, gross ThUS$ ThUS$
Construction in progress 6,408,721 6,234,130
Land 373,081 173,316
Buildings 6,057,264 5,963,605
Plantand equipment 19,505,550 19,217,547
Fixtures and fitings 47,468 58,631
Motor vehicles 2,088,020 2,080,124
Land improvements 6,747,320 6,504,063
Mining operations 9,183,358 8,751,368
Mine development 4,899,185 4,546,765
Other assets 1,163,185 1,164,163
Total Property, Plant and Equipment, gross 56,473,152 | 54,693,712

51
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Property, Plant and Equipment, accumulated 9/30/2020 12/31/2019
depreciation ThUS$ ThUS$
Construction in progress – –
Land 12,058 9,975
Buildings 3,289,634 3,152,227
Plantand equipment 11,065,262 10,618,524
Fixtures and fitings 41,784 47,431
Motor vehicles 1,550,022 1,480,020
Land improvements 3,662,675 3,482,960
Mining operations 5,965,896 5,253,285
Mine development 984,162 893,575
Other assets 510,851 487,703
Total Property, Plant and Equipment, accumulated 27,082,344 | 25,425,700
depreciation

: 9/30/2020 12/31/2019

Property, Plant and Equipment, net Thus$ ThUS$

Construction in progress 6,408,721 6,234,130
Land 361,023 163,341
Buildings 2,767,630 2,811,378
Plantand equipment 8,440,288 8,599,023
Fixtures and fitings 5,684 11,200
Motor vehicles 537,998 600,104
Land improvements 3,084,645 3,021,103
Mining operations 3,217,462 3,498,083
Mine development 3,915,023 3,653,190
Other assets 652,334 676,460
Total Property, Plant and Equipment, net 29,390,808 | 29,268,012

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

b) Movement of Property, plant and equipment:

[9/30/2020

Movements Construction 2% Plantand |. Fixed Motor Ground Mining — | Development | Other
$ in progress Land Buildings equipment installations and vehicles improvements | operations of mines assets Total
Thus accessories
Reconciliation of changes in properties, plant and equipment
IAS plantand equipmental he beginning ofihe period. Opening Balance 6234,130) 163341] 2811,378| — 8,599,023] 11.200] 600,104 3,021,103 3498083] 3,653,190| 676460| 20,268,012
Changes in property, plant and equipment
Increases other than those from business, property, plant and equipment combinations 1,465,390] – > 7,246] 1 1,509] 4,977 304,810 – 15,138] 1,799,071
Depreciation, property, plant and equipment – (3,224) (138,080) (444,159) (1,826) (73,497) (179,715) (722,728) (80,470)| — (30,133)| (1,673,832)
Increases (decreases) in transfers and other changes, properties, plant and
equipment
sees by transfers from construatons in process, propertes, plant and (1,051,621) 202,977 58,692 236,397 1 10,459] 227,829 34,876 280,180 210 –
Increases (decreases) by other changes, properties, plant and equipment (238,332) (2,071) 36,421 42,470| (3,688) (77) 10,740 102,421 62,123| (9,341) 666|
Ia O by transfers and other changes, properties, plant and (1,289,953) 200,906 95,113| 278,867 (3,687) 10,382 238,569 137,297| 342,303] — (9,131) 666
Dispositions and withdrawals of service, property, plant and equipment
Retirements, property, plant and equipment (846) – (781) (689) (4) (500) (289) – – – (3,109)
Dispositions and withdrawals of service, property, plant and equipment (846) – (781) (689) (4) (500) (289) – . . (3,109)
Increase (decrease) in properties, plant and equipment 174,591 197,682! (43,748)| (158,735) (5,516) (62,106) 63,542| (280,621) 261,833] (24,126)| 122,796
Properties, plant and equipment at the end of the period. Closing balance 6,408,721 361,023) — 2,767,630) — 8,440,288| 5,684 | 537,998 3,084,645| — 3,217,462| 3/915.023) 652,334| 29,390,808

53

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Movements Construction 2% Plantand | Fixed Motor Ground Mining — | Development | Other
s Land Buildings s installations and s , s : Total
ThuS$ in progress Del ccessories vehicles | improvements | operations | ofmines assets

Reconciliation of changes in properties, plant and equipment
dE plantand equipmental he beginning ofihe period. Opening Balance 8808,652| 164962] 2,354308| — 5,768,793 14,929] 684,009 2,352,556] — 2:486,324| 3,313,044] — 807.336| 26,754,098
Changes in property, plant and equipment
Increases other than those from business, property, plant and equipment combinations 3,602,113 > 1,750 14,525] 23 7,852 19,128| 521,191 – 14,917| 4,181,499
Depreciaton, property, plantand equipment – (1,010)| — (162,340)| (649,076) (8,663)| — (109,913) (215,641)| — (796,714) (87,983)| — (47,606) (2,073,896)
Impairment losses recognized in profit or loss for the period – > – – – > – > – – –
Increases (decreases) in transfers and other changes, properties, plant and
equipment
E sees by transfers from constructons in process, properties, plantand (6,173,762) L 646,591 3,511,039 6 17.702 816,773 1,176,508 5,049 94 –
Increases (decreases) by other changes, properties, plant and equipment 4,389 (611) (23,221) (28,739) (94) 1,874] 48,561 110,774, 423,030] (95,338) 440,625
a by transfers and other changes, properties, plant and (6,169,373) (611) 623,370] 3,482,300 (88) 19,576 865,334] — 1,287,282 428,079| — (95,244)| 440,625
Dispositions and withdrawals of service, property, plant and equipment
Retirements, property, plant and equipment (7,262) > (5,795) (17,519) (1) (1,420) (274) > – (2,943) (35,214)
Dispositions and withdrawals of service, property, plant and equipment (7,262) – (5,795) (17,519) (1) (1,420) (274) + – (2,943) (35,214)
Increase (decrease) in properties, plant and equipment (2,574,522) (1,621) 456,985] 2,830,230 (3,729) (83,905) 668,547] 1,011,759 340,146| (130,876)| 2,513,014!
Properties, plant and equipment at the end of the period. Closing balance 6234,:130 163,341) 2,811,378] — 8,599,023 11,200) 600,104 3,021,103] 3,498,083) 3,653,190] 676,460| 29,268,012

12/31/2019

54
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

c)

The balance of construction in progress, is directly associated with the operating activities of the
Corporation and relates to the acquisition of equipment for projects in construction and associated
costs toward their completion.

The Corporation has signed insurance policies to cover the possible risks to which the various
property, plant and equipment items are subject, as well as the possible claims that may arise for the
period of its activities. Such policies sufficiently cover the risks to which they are subject in
Management’s opinion.

Borrowing costs capitalized for the nine-month period ended September 30, 2020 and 2019 were
ThUS$155,750 and ThUS$269,215, respectively. The annual capitalization average rate for the nine-
month periods ended September 30, 2020 and 2019 was 3.95% and 4.19%, respectively.

Expenses on exploration and drilling of deposits recognized in profit or loss and the cash outflows
disbursed for the same concepts are presented in the following table:

1/1/2020 1/1/2019

Expenditure on exploration and drilling 9/30/2020 9/30/2019

reservoirs

ThUs$ ThUs$
Recognized in profit 18,881 33,124
Cash outflows disbursed 22,165 31,189
The detail of “Other assets” under “Property, plant and equipment” is as follows:
9/30/2020 | 12/31/2019
Other assets, net ThUS$ ThUS$
Mining properties from the purchase of Anglo American Sur S.A. 402,000 402,000
Maintenances and other major repairs 198,397 217,079
Other assets – Calama Plan 48,014 54,174
Other 3,923 3,207
Total other assets, net 652,334 676,460

The Corporation currently has no ownership restrictions relating to assets belonging to Property,
plant and equipment, except for leased assets whose legal title corresponds to the lessor.

Codelco has not pledged any items of property, plant and equipment as collateral to third parties in
order to enable the realization of its normal business activities or as a commitment to support
payment obligations.

As of September 30, 2020 and 2019, property, plant and equipment assets did not show any

indication of impairment or reversal of impairment recognized in prior years, therefore, no
adjustments were made to the value of assets at that date.

55
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

k) The Corporation presents at December 31, 2019 a reclassification of property, plant and equipment
to the item intangible assets other than goodwill which amounts to ThUS$2,090.

1) The expense for depreciation of the property, plant and equipment item for the nine-month period
ended September 30, 2020 corresponds to ThUS$1,673,882.

Leases
8.1 Right-of-use assets

As of September 30, 2020 and December 31, 2019, the breakdown of the asset by right of use category is:

ltems 9/30/2020 12/31/2019
ThUS$ ThUS$
Assets by rightofuse, gross 760,999 692,262
Assets by rightof use, accumulated depreciation 364,224 260,110
Total Assets by right of use, net 396,775 432,152

The movements for the nine-month period ended September 30, 2020 and the year ended December 31,
2019 are as follows:

Reconciliation of changes in Assets by right of use 9/30/2020 12/31/2019
(in thousands ofUS$) MUS$ MUS$
Opening Balance 432,152 –
Application ofIFRS 16 – 378,582
Increases 85,224 109,505
Depreciation (111,514) (143,369)
Increases (decreases) by other changes (9,087) 87,434
Increase (decrease) in Assets by right of use (35,377) 432,152
Closing balance 396,775 432,152

The depreciation expense for the nine-month period ended September 30, 2020 corresponds to
ThUS$111,514.

The composition by asset class is as follows:

. 9/30/2020 12/31/2019
Assets by right of use ThUS$ ThUS$
Buildings 13,860 18,286
Plantand equipment 233,468 298,463
Motor vehicles 8,775 11,504
Fixtures and fitings 134,256 97,952
Others assets – rightofuse 6,416 5,947
Total Assets by right of use 396,775 432,152

56
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

8.2 Liabilities for current and non-current leases

As of September 30, 2020 and December 31, 2019, the payment commitments for leasing operations are
summarized in the following table:

9/30/2020 12/31/2019
Leases Gross Interest | Present Value Gross Interest | Present Value
ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$
Less than 90 days 37,260 (3,477) 33,783 39,668 (4,557) 35,111
Between 90 days and 1 year 101,884 (9,431) 92,453 105,315 (12,665) 92,650
Between 1 and 2 years 99,516 (8,687) 90,829 107,218 (12,248) 94,970
Between 2 and 3 years 74,416 (6,324) 68,092 77,753 (9,881) 67,872
Between 3 and 4 years 40,030 (4,312) 35,718 60,078 (6,813) 53,265
Between 4 and 5 years 37,223 (3,863) 33,360 32,384 (4,780) 27,604
More than 5 years 50,845 (9,687) 41,158 70,857 (9,458) 61,399
Total 441,174 (45,781) 395,393 493,273 (60,402) 432,871

Leasing operations are generated by service contracts, mainly for facilities, buildings, plants and equipment.

The expense related to short-term leases, low-value assets and variable leases not included in the
measurement of lease liabilities, for the period ended September 30, 2020 and 2019 ¡is presented in the

following table:

indices or rates)

Variable lease payments not included in the initial measurement or
remeasurementofliabilites (excluding, where applicable, changes in

1/1/2020 1/1/2019
Lease expense 9/30/2020 9/30/2019

ThUS$ ThUS$
Short-term leases 22,559 68,120
Low value leases 11,775 58,625

1,096,782 949,584

TOTAL

1,131,116 1,076,329

Investments accounted for using the equity method

The following table sets forth the carrying amount and the share of profit (loss) of the investments accounted
for using the equity method (all material associates’ principal place of business is Chile):

Equity Interest Carrying Value Net income (loss) Net income (loss)
. Taxpayer | Funct. 1/2020 | 1míow | 72020 | 7/11/2019
Associates Numbers —|Currency| 920/2020 | 12/31/2019 | 9/80/2020 | 12/81/2019 | o2o079 | or3ozor | orsoizozo | or3o/2019
% % Thus$ ThUS$ ThUS$ Thus$ ThUS$ ThUs$
Agua de la Falda S.A. 96.801.450-1 | US$ | 42.26% 42.26% 4,866 4,864 (175) (203) (130) (73)
[Anglo American Sur S.A. 77.762.940-9 | US$ 29.5% 29.5% 2,846,280 | 2,850,171 18,825 19,308 18,927 8,866
Inca de Oro S.A. 73.063.022-5 | US$ | 33.19% 33.19% 12,577 12,675 (95) (65) (95) (55)
Kairos Mining S.A. 76.781.030-k | US$ | 40.00% 40.00% 33 82 (16) – – –
Minera Purén SCM 76.028.880-2 | US$ 35.0% 35.0% 9,921 9,934 (13) 33 (15)
Planta Recuperadora de Metales SpA | 76.255.054-7 | US$ 34.0% 34.0% 11,507 10,914 593 228 285 267
Sociedad Contractual Minera El Abra — | 96.701.340-4 | US$ 49.0% 49.0% 585,368 594,883 (9,406)| (13,368) 3,243 (3,170)
Sociedad GNL Mejilones S.A. 76.775.710-7 | US$ 0.0% 0.0% – . 5,920 811
TOTAL 3,470,552 [ 3,483,523 9,713 11,863 22,230 6,630

57

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

a)

Associates
Agua de la Falda S.A.

As of September 30, 2020, Codelco holds a 42.26% ownership interest in Agua de la Falda S.A., with
the remaining 57.74% owned by Minera Meridian Limitada.

The corporate purpose of this company is to exploit deposits of gold and other minerals, in the third
region of Chile.

Sociedad Contractual Minera El Abra

Sociedad Contractual Minera El Abra was incorporated in 1994. As of September 30, 2020, Codelco
holds a 49% ownership interest, with the remaining 51% owned by Cyprus El Abra Corporation, a
subsidiary of Freeport-McMoRan Copper 8 Gold Inc.

The company business activities involve the extraction, production and selling of copper cathodes.

Sociedad Contractual Minera Purén

As of September 30, 2020, Codelco holds a 35% ownership interest, with the remaining 65% owned
by Compañía Minera Mantos de Oro.

This company’s corporate purpose is to explore, identify, survey, investigate, develop and exploit
mining deposits in order to extract, produce and process minerals.

Sociedad GNL Mejillones S.A.
The Corporation effected on August 6, 2019, the sale of its 37% stake in the company GNL Mejillones
S.A. to the Ameris Capital AGF Investment fund, for an amount of US$193.5 million. (The remaining

63% corresponded to Suez Energy Andino S.A.).

The sale of the LNG Mejillones stake generated a profit of US$103 million before tax and a result after
tax of US$36 million.

Inca de Oro S.A.
On June 1, 2009, Codelco’s Board of Directors authorized the incorporation of a new company aimed
to develop studies allowing the continuity of the Inca de Oro Project, which is a wholly-owned subsidiary

of Codelco.

As of September 30, 2020, Codelco holds a 33.19% ownership interest in this company. (PanAust IDO
Ltda. has 66.31%).

58
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Planta Recuperadora de Metales SpA

On December 3, 2012, Planta Recuperadora Metales SpA was incorporated by Codelco, which held a
100% ownership interest of this company.

On July 7, 2014, Codelco reduced its ownership interest in Planta Recuperadora de Metales SpA to
51%, with the remaining 49% ownership interest held by LS-Nikko Copper Inc.

On October 14, 2015, Codelco reduced its ownership interest to 34% interest, with LS-Nikko Copper
Inc, holding the remaining 66%.

As of September 30, 2020, LS-Nikko Copper Inc, is the controlling shareholder of this company based
on the control elements set out in the shareholders’ agreement.

The principal business activity of the company is the processing of intermediate products of the refining
and processing of copper and other metals aiming to recover copper, other metals and other sub
products, their transformation to commercial products and the selling and distribution of all classes of
goods or inputs derived from such process.

Anglo American Sur S.A.

As September 30, 2020, the controlling shareholder of Anglo American Sur S.A. is Inversiones Anglo
American Sur S.A. holding a 50.06% ownership interest, while the non-controlling interest is held by
Inversiones Mineras Becrux SpA., which in turn is a subsidiary controlled by Codelco with a 67.8%
ownership interest. Consequently, Codelco exercises significant influence in Anglo American Sur S.A.
through its indirect ownership interest of 29.5%.

The principal activities of the Company are the exploration, extraction, exploitation, production,
processing and trading of minerals, concentrates, precipitates, copper bars and all metallic and non-
metallic minerals, all fossil substances and liquid and gaseous hydrocarbons. This includes the
exploration, exploitation and use of all natural energy sources capable of industrial use and the
products or by-products obtained, as well as any other related, connected or complementary activities
on which the shareholders agree.

On August 24, 2012, Codelco recognized the acquisition of ownership interest in Anglo American Sur
S.A. which resulted in the initial recognition of the cost of the investment for ThUS$6,490,000 that
corresponded to the proportionate share (29.5%) of the net fair value of the identifiable assets and
liabilities acquired.

In determining the share of the fair value of the identifiable assets and liabilities acquired, the
Corporation considered the resources and mineral reserves that could be measured reliably.

As part of this updating process, and applying the valuation criteria indicated above, the fair value of
the assets acquired and liabilities assumed of Anglo American Sur S.A. As of that date it amounted to

59
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

US $ 22,646 million, which in the proportion acquired by Inversiones Mineras Becrux SpA (29.5%)
results in an investment at fair value of US $ 6,681 million at the acquisition date.

The allocation of the purchase price at fair value between the identifiable assets and liabilities was
prepared by management using its best estimate and taking into account all relevant and available
information at the acquisition date of Anglo American Sur S.A.

The Corporation used a discounted cash flows model to estimate cash flow projections, based on the
life of mine. These projections were based on estimated production and future prices of minerals,
operating costs and capital costs, among other estimates made at the date of acquisition. Additionally,
proven and probable resources to explore were not included in the mine plan, therefore, they were
valued separately using a market model. Such resources are included in item “Mineral Resources.”

As of December 31, 2015, the Corporation identified indicators of impairment in the operating units of
Anglo American Sur S.A. Consequently, and with the purpose of making the corresponding
adjustments to the investment in this associate, the Corporation estimated ¡ts recoverable amount.

In determining the recoverable amount, the Corporation applied the methodology of fair value less
costs of disposal. The recoverable amount of the operating units was determined based on the life of
mine by using a discounted cash flow model whose main assumptions included ore reserves declared
by the associate, copper price, supply costs, foreign exchange rates, discount rate and market
information for the long-term asset valuation. The discount rate used was annual rate of 8% after taxes.

Furthermore, the proven reserves not included in the mining plan (LOM), as well as the probable
reserves to explore, have been valued using a multiples market approach for comparable transactions.
Such methodology is consistent with the methodologies used at the acquisition date, which is described
in the previous paragraph.

The recoverable amount as estimated was less than the carrying amount of the identified assets of the
associate, therefore, the Corporation recognized an impairment loss of ThUS$2,439,495, which was
included within the line item “Share of profit or loss of associates and joint ventures accounted for using
the equity method” in the consolidated statement of comprehensive income for the year ended
December 31, 2015. The impairment loss was mainly attributable to the drop in copper prices during
the year 2015.

Subsequent to recognition of the impairment, there have been no indicators requiring the recognition
of further impairment losses on the recoverable amount of the investment held in Anglo American Sur
S.A.

As of September 30, 2020 and 2019, there are no indicators of impairment nor reversal, therefore,
there have been no adjustments recognized to the carrying amounts of the assets.

60
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Kairos S.A.

Until before November 26, 2012, the Corporation held a 40% stake in conjunction with Honeywell
Chile S.A. who was the majority shareholder with 60% of the capital stock of Kairos Mining S.A.

On November 26, 2012, the Corporation sold part of its stake to Honeywell Chile SA, which implies
that Codelco maintained a 5% interest as of December 31, 2012, while the remaining 95% was held
Honeywell Chile S.A. The result of this pre-tax operation was ThUS$13.

On June 6, 2019, Codelco purchased 350 shares of Kairos Mining from Honeywell Chile S.A.,
increasing ¡ts participation from 5% to 40%.

As of September 30, 2020, the control of the company lies in Honeywell Chile S.A. which owns 60%
of the shares while Codelco owns the remaining 40%.

The purpose of the company is to provide automation and control services for industrial and mining
activities and to provide technology and software licenses.

The following tables provide details of asset and liabilities of the associates as of September 30, 2020
and December 31, 2019, and their profit (loss) for the nine-month periods ended September 30, 2020
and 2019:

eses 9/30/2020 12/31/2019
Assets and Liabilities ThUS$ ThUS$
Current Assets 1,646,626 1,735,588
Non-current Assets 5,315,305 5,248,569
Current Liabilities 691,362 618,644
Non-current Liabilities 1,704,456 1,793,879
1/11/2020 1/1/2019 7/1/2020 7/11/2019
Net Income 9/30/2020 9/30/2019 9/30/2020 9/30/2019
ThUS$ ThUS$ ThUS$ ThUS$
Revenue 1,805,879 2,106,920 749,342 621,364
Costof sales (1,734,426) (2,034,084) (669,618) (569,191)
Profit for the period 71,453 72,836 79,724 52,173
Movements of Investment in 1/1/2020 1/1/2019
Associates 9/30/2020 9/30/2019
ThUS$ ThUS$
Opening balances 3,483,523 3,568,293
Contributions 176 240
Dividends (22,715) –
Resultofthe period 9,713 11,863
Sales – (90,329)
Other comprehensive income (109) (325)
Other (36) (888)
Final balance 3,470,552 3,488,854

61
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The following tables provide details of asset and liabilities of the principal associates as of September
30, 2020 and December 31, 2019, and their profit (loss) for the nine-month periods ended September
30, 2020 and 2019.

Anglo American Sur S.A.

Assets and liabilities 9/30/2020 1213112019

ThUS$ ThUS$
Current Assets 1,133,698 1,099,695
Non-current Assets 4,046,802 4,083,739
Current Liabilities 616,206 531,089
Non-current Liabilities 1,304,490 1,405,143
1/11/2020 1/1/2019 7/1/2020 7/1/2019
Net Income 9/30/2020 9/30/2019 9/30/2020 9/30/2019
ThUS$ ThUS$ ThUS$ ThUS$
Revenue 1,471,675 1,733,940 629,951 525,502
Costof sales (1,382,072)| (1,633,982) (557,132) (484,130)
Profit for the period 89,603 99,958 72,819 41,372

Sociedad Contractual Minera El Abra

Assets and liabilities 9/30/2020 1213112019

ThUS$ ThUS$
Current Assets 460,810 590,850
Non-current Assets 1,115,606 1,007,012
Current Liabilies 64,209 79,422
Non-current Liabilities 317,579 304,394
1/1/2020 1/1/2019 7/1/2020 7/11/2019
Net Income 9/30/2020 9/30/2019 9/30/2020 9/30/2019
ThUS$ ThUS$ ThUS$ ThUS$
Revenue 311,688 351,930 108,501 131,845
Costof sales (330,883) (379,211) (101,881) (138,314)
Profit (loss) for the period (19,195) (27,281) 6,620 (6,469)

b) Additional information on unrealized profits (losses)
Codelco enters into transactions for the purchase and sale of copper with Sociedad Contractual Minera
El Abra. As of September 30, 2020 and December 31, 2019, there were no unrealized profits (losses)
recognized in the carrying amount of inventories of finished products.

The Corporation has recognized unrealized gains for the purchase of rights to use the LNG terminal
from the El Abra Mining Contract Company for ThUS$3,920 as of September 30, 2020 and 2019.

62
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

c) Share of profit or loss for the year

The share in profit or loss of the associate Anglo American Sur S.A. recognized for the nine-month
period ended September 30, 2020 was profit of ThUS$26,433 (profit of ThUS$29,488 for the nine-
month period ended September 30, 2019). In addition, the Corporation has made appropriate
adjustments to its share of profit or loss in the associate for depreciation of the depreciable assets
based on the fair values at the acquisition date, which resulted in an expense of ThUS$7,608 for the
nine-month period ended September 30, 2020 (an expense of ThUS$10,180 for the nine month period
ended September 30, 2019) recognized within line item “Share of profit or loss of associates and joint
ventures accounted using the equity method” in the consolidated statement of comprehensive income.

10. Subsidiaries

The following tables set forth a detail of assets, liabilities and profit (loss) of the Corporation’s subsidiaries,

prior to consolidation adjustments:

bee 9/30/2020 12/31/2019
Assets and liabilities ThUS$ ThUSS

Current assets 464,800 464,674

Non Current Assets 3,572,721 3,607,177

Current Liabilities 293,312 281,973

Non Current Liabilities 1,063,764 1,086,975
1/11/2020 1/11/2019 7/1/2020 7/1/2019

Profit (loss) 9/30/2020 9/30/2019 9/30/2020 9/30/2019

ThUS$ ThUS$ ThUS$ ThUS$

Ordinary Income 729,476 857,593 302,003 254,066

Ordinary Expenses (747,498) (879,208) (289,945) (265,756)

(Loss) profit of period (18,022) (21,615) 12,058 (11,690)

11. Current and non-current financial assets

Current and non-current financial assets included in the statement of financial position are as follows:

9/30/2020
Atfair value Derivatives for hedging . s
a . , o _ Total financial
Classification in the statement of financial | though profitand | Amortized Cost Hedging Cross currency assets
position loss derivatives swap
ThUus$ ThUus$ ThUS$ ThUS$ ThUus$
Cash and cash equivalents 11,882 3,442,007 – 3,453,889
Trade and other current receivables 699,646 1,634,341 2,333,987
Non – currentreceivables – 91,160 91,160
Currentreceivables from related parties 21,523 21,523
Non – current receivables from related parties 13,194 – 13,194
Other current financial assets 203,581 276 – 203,857
Other non – current financial assets – 5,527 – 61,342 66,869
TOTAL 711,528 5,411,333 276 61,342 6,184,479

63

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

As of September 30, 2020, the balance of the caption “Other financial assets, current” includes
ThUS$203,512 invested in term deposit instruments with a maturity of more than 90 days. As of December
31, 2019, the amount invested in this type of instrument was ThUS$171,4209.

12/31/2019

Atfair value Derivatives for hedging Total financial

Classification in the statement of financial | though profitand | Amortized Cost Hedging Cross currency assets

position loss derivatives swap

ThUS$ ThUS$ ThUS$ ThUS$ ThUS$
Cash and cash equivalents 2,158 1,300,947 – – 1,303,105
Trade and other current receivables 723,619 1,864,649 – – 2,588,268
Non – currentreceivables – 98,544 – – 98,544
Currentreceivables from related parties – 20,874 – – 20,874
Non – current receivables from related parties – 15,594 – 15,594
Other current financial assets – 171,636 1,315 – 172,951
Other non – current financial assets – 8,691 525 82,584 91,800
TOTAL 725,777 3,480,935 1,840 82,584 4,291,136

» Fair value through profit or loss: As of September 30, 2020, this category mainly includes receivables
from provisional invoicing sales. Section 11.2.r.

» Amortized cost: lt corresponds to financial assets held within a business model whose objective is to
hold financial assets to collect contractual cash flows that are solely payments of principal and interest
on the principal outstanding. These assets are not quoted in an active market.

The effects on profit or loss recognized for these assets are mainly from financial income and exchange
differences from balances denominated in currencies other than the functional currency.

No material impairments were recognized in trade and other receivables.

e Derivatives for Hedging: Corresponds to the balance for changes in the fair value of derivative
contracts to cover existing transactions (cash flow hedges) and that affect the profit or loss when
transactions are settled or when, to the extent required by accounting standards, a compensation effect
is charged (credited) to the income statement. The detail of derivative hedging transactions ¡is included
in the Note 27.

As of September 30, 2020 and December 31, 2019, there were no reclassifications between the different
categories of financial instruments, under the accounting standards at the respective dates.

12. Other financial liabilities

Current and non-current interest-bearing borrowings consists of loans from financial institutions and bond
issuance obligations, which are measured at amortized cost using the effective interest rate method.

64
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The following tables set forth other current/non-current financial liabilities:

9/30/2020
Current Non-current
Items Amortized Cost] Hedging Total Amortized Cost; Hedging Total
derivatives derivatives
ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$

Loans from financial institutions 390,953 – 390,953 2,124,583 – 2,124,583
Bonds issued 550,405 – 550,405 | 16,502,721 – | 16,502,721
Hedging derivatives – 7,329 7,329 – 179,828 179,828
Other financial liabilities – – – 54,177 – 54,177

Total 941,358 7,329 948,687 | 18,681,481 179,828 | 18,861,309

12/31/2019
Current Non-current
Items Amortized Cost] Hedging Total Amortized Cost; Hedging Total
derivatives derivatives
ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$

Loans from financial institutions 666,144 – 666,144 2,408,267 – 2,408,267
Bonds issued 572,587 – 572,587 | 13,617,358 – | 13,617,358
Hedging derivatives – 11,496 11,496 – 148,987 148,987
Other financial liabilities 363 – 363 58,501 – 58,501

Total 1,239,094 11,496 1,250,590 | 16,084,126 148,987 | 16,233,113

Loans from financial institutions:
The loans obtained by the Corporation aim to finance production operations.

In addition to the credits mentioned in the previous paragraph, Codelco, through the subsidiary company
Inversiones Gacrux SpA., has a credit agreement with Oriente Copper Netherlands B.V. since 2012 (a
subsidiary of Mitsui 8 Co. Ltd.), which was subscribed to with the aim of allocating this financing to the
acquisition of the shareholding of Anglo American Sur SA, by the subsidiary company Inversiones
Mineras Becrux SpA. (Subsidiary of Inversiones Gacrux SpA.). This loan has no associated personal
guarantees and its rate is fixed at 3.25% per year and has a duration of 20 years, being payable in 40
semiannual installments of principal and interest on unpaid balances.

As of September 30, 2020, the outstanding balance of the credit agreements is TRUS$579,674

Bond issued:

On May 10, 2005, the Corporation issued and placed bonds in the domestic market for a nominal amount
of UF 6,900,000 of a single series labeled “Series B”, which consists of 6,900 bonds for UF 1,000 each.

These bonds are payable in a single installment on April 1, 2025, at an annual interest rate of 4% and
semi-annual interest payments.

65
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

On September 21, 2005, the Corporation issued and placed bonds in the U.S. market under Rule 144-
A and Regulation S, for a nominal amount of ThUS$500,000. These bonds are payable in a single
installment on September 21, 2035, at an annual interest rate of 5.6250% and semi-annual interest
payments.

On October 19, 2006, the Corporation issued and placed bonds in the U.S. market under Rule 144-A
and Regulation S, for a nominal amount of ThUS$500,000. These bonds are payable in a single
installment on October 24, 2036, at an annual interest rate of 6.15% and semi-annual interest payments.

On January 20, 2009, the Corporation issued and placed bonds in the U.S. market under Rule 144-A
and Regulation S, for a nominal amount of ThUS$600,000. These bonds are payable in a single
installment on January 15, 2019, at an annual interest rate of 7.5% and semi-annual interest payments.
On August 3, 2017, principal was paid for an amount of ThUS$333,155.

On November 4, 2010, the Corporation issued and placed bonds in the U.S. market under Rule 144-A
and Regulation S, for a nominal amount of ThUS$1,000,000. These bonds are payable in a single
installment on November 4, 2020, at an annual interest rate of 3.75% and semi-annual interest payments.
On August 3, 2017, February 6, 2019 and October 2, 2019, principal was paid for an amount of
ThUS$414,763, ThUS$183,051 and ThUS$7,304 respectively.

On November 3, 2011, the Corporation issued and placed bonds in the U.S. market under Rule 144-
A and Regulation S, for a nominal amount of ThUS$1,150,000. These bonds are payable in a single
installment on November 4, 2021, atan annual interest rate of 3.875% and semi-annual interest
payments. On August 3, 2017, February 6, 2019 and October 2, 2019, principal was paid for an amount
of ThUS$665,226, ThUS$247,814 and ThUS$9,979 respectively.

On July 17, 2012, the Company issued and placed bonds in the U.S. market under Rule 144-A and
Regulation S, for a nominal amount of ThUS$2,000,000. These bonds are payable in two installments
(i) the first tranche on July 17, 2022 in the amount of US$1,250,000 at a 3% annual interest rate. On
August 22, 2017, February 6, 2019 and October 22, 2019, principal was paid in the amounts of
ThUS$412,514, ThUS$314,219, ThUS$106,972 and ThUS$$3,820 respectively, and (ii) the other
tranche matures on July 17, 2042 and ¡is in the amount of ThUS$750,000 at an annual interest rate of
4.25%.

On August 13, 2013, the Corporation issued and placed bonds in the U.S. market, under Rule 144-A
and Regulation S, for a nominal amount of ThUS$750,000, payable in a single installment on August 13,
2023, at an annual interest rate of 4.5% and semi-annual interest payments. On August 22, 2017,
February 12 and February 26, 2019, principal in the amounts of ThUS$162,502, ThUS$228,674 and
ThUS$270 respectively, was paid. On October 8 and 22, principal was amortized for ThUS$23,128 and
ThUS$555 respectively. On May 6, 2020, the remaining principal due was increased for a nominal
amount of ThUS$131,000, reaching a total amount of TRUS$465,871 with an annual coupon of 4.50%.

On October 18, 2013, the Corporation issued and placed bonds in the U.S. market, under Rule 144-A

and Regulation S, for a nominal amount of ThUS$950,000, payable in a single installment on October
18, 2043, at an annual interest rate of 5.625% and semi-annual interest payments.

66
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

On July 9, 2014, the Corporation issued and placed bonds in the international financial markets, under
Rule 144-A and Regulation S, for a nominal amount of EUR$600,000,000, payable in a single installment
on July 9, 2024, at an annual interest rate of 2.25% and annual interest payments.

On November 4, 2014, the Corporation issued and placed bonds in the U.S. market, under Rule 144-A
and Regulation S, for a nominal amount of ThUS$980,000, payable in a single installment on November
4, 2044, at an annual interest rate of 4.875% and semi-annual interest payments.

On September 16, 2015, the Corporation issued and placed bonds in the U.S. market, under Rule 144-
A and Regulation S, for a nominal amount of ThUS$2,000,000, payable in a single installment on
September 16, 2025, at an annual interest rate of 4.5% and semi-annual interest payments. On August
22, 2017 and February 12, 2019, principal was paid for an amount of ThUS$378,655 and ThUS$552,754
respectively.

On August 24, 2016, the Corporation issued and placed bonds in the local market for a nominal amount
of UF10,000,000 of single series labeled “Series C”, which consists of 20,000 bonds for UF500 each.
These bonds are payable in a single installment on August 24, 2026, at an annual interest rate of 2.5%
and semi-annual interest payments.

On July 25, 2017, the Corporation made an offer in New York to buy its bonds issued in dollars with
maturities between 2019 and 2025, repurchasing US$2,367 million.

On August 1, 2017, the Corporation issued and placed bonds on the North American market, under
standard 144-A and Regulation S, for a total, nominal, amount of TRUS$2,750,000. ThUS$1,500,000,
with an annual coupon rate of interest of 3.625% and semi-annual interest payments which will mature
on August 1, 2027, while TNUS$1,250,000, with an annual coupon of 4.5% and semi-annual interest
payments, will mature on August 1, 2047.

These operations allowed optimizing the debt maturity profile of Codelco. As a result of these
transactions, 86% of the funds from the new issue (US$2,367 million) were used to refinance old debt.
The average interest rate of refinanced funds decreased from 4.36% to 4.02%.

The effect recognized in profit and loss associated with this refinancing was a charge of US$ 42 million
after tax.

On May 18, 2018, Codelco issued a bond for US$600 million with 30 year maturity in the market of
Formosa, Taiwan. The bond issued is denominated in US dollars, had a yield of 4.85% and a prepayment
option at the issue value that can be exercised from the fifth year onwards at its par value.

On January 28, 2019, the Corporation in New York made an offer to purchase ¡its bonds issued in dollars
with maturities between 2020 and 2025, repurchasing US$1,527 millions.

Subsequently, on February 5, 2019, the Corporation issued and placed bonds in the North American
market, under Rule 144-A and Regulation S, for a total nominal amount of ThUS$1,300,000, which
maturity will be 5 February 2049 with a coupon of 4.375% per annum and interest payments on a semi-
annual basis.

67
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The effect recognized in results associated with this refinancing was a charge of US$10 million after
taxes.

On July 22, 2019, the Corporation made a bond issue and placement, Regulation S, for a nominal
amount of AUD $ 70,000,000, whose maturity will be in a single installment on July 22, 2039, with a
coupon of 3.58% annual and interest payment annually.

On August 23, 2019, the Corporation made a bond issue and placement, Regulation S, for a nominal
amount of US$130,000,000, whose maturity will be in a single installment on August 23, 2029, with a
coupon of 2.869% annual and interest payment semiannually.

On September 30, 2019, the Corporation made an issue and placement of bonds in the North American
market, under rule 144-A and Regulation S, for a total nominal amount of ThUS$2,000,000 whose
maturity will be, under one tranche, on September 30, 2029 corresponding to an amount of
ThUS$1,100,000 with a 3% annual coupon. The other tranche contemplates a maturity on January 30,
2050, corresponding to an amount of TRUS$900,000. On January 14, 2020, the principal for the last
tranche was increased for a nominal amount of ThUS$1,000,000, reaching a total amount of
ThUS$1,900,000 with a coupon of 3.70% per year.

Along with this placement, Codelco launched a purchase offer, in which a repurchase amount of US$
152 million was reached. The effect recognized in results associated with this refinancing was a charge
of US$2 million after taxes.

On January 14, 2020, the Corporation issued and placed bonds in the North American market, under
rule 144-A and Regulation S, for a nominal amount of ThUS $ 1,000,000, the maturity of which will be in
a single installment on 14 January 2030, with a coupon of 3.15% per annum and payment of interest
every six months.

On May 6, 2020, the Corporation issued and placed bonds in the North American market, under Rule
144-A and Regulation S, for a nominal amount of ThUS$800,000 whose maturity will be in a single
installment on 15 January 2031, with a coupon of 3.75% per annum and interest paid every six months.

As of September 30, 2020 and 2019, the Corporation is not required to comply with any financial
covenants related to borrowings from financial institutions and bond obligations.

Financial debt commissions and expenses: Transaction costs incurred in obtaining financial
resources are deducted from the loan proceeds and are amortized using the effective interest rate.

68
CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

As of September 30, 2020, the details of loans from financial institutions and bond obligations are as follows:

9/30/2020

Loans with Principal . , Current | Non-current

Taxpayer 1D Country financial Institution Maturity Interest Currency | Amount Type of amortization Payment of |. Nominal Effective balance balance

Number entities Rate Interest — | Interest Rate | Interest Rate ThUS$ ThUS$
97.018.000-1 [Chile Bilateral Credit | Scotiabank Chile 12/20/2020| Floating US$ |300,000,000| Maturity Semi-annual 1.15% 1.15% 300,958 –
Foreign [Cayman Island | Bilateral Credit [Scotiabank 8 Trust(Cayman) Ltd 4/13/2022 | Floating US$ |300,000,000| Maturity Quarterly 0.93% 1.11% 594 299,205
Foreign — [Japan Bilateral Credit. [Japan Bank International Cooperation] 5/24/2022 | Floating | US$ |224,000,000| “4Yearl principal payments |< 21 l 1.03% 1.19% 32,232 31,913 from 2015 to the present Foreign [USA Bilateral Credit [Export Dev Canada 7/17/2022 | Floating US$ |300,000,000| Maturity Quarterly 0.91% 0.97% 518 299,675
Foreign [Panama Bilateral Credit [Banco Latinoamericano de Comercio | 12/18/2026| Floating US$ 75,000,000| Maturity Semi-annual 1.62% 1.77% 338 74,457
Foreign [USA Bilateral Credit [Export Dev Canada 8/12/2027 | Floating US$ |300,000,000| Maturity Quarterly 1.41% 1.47% 574 299,067
Foreign [USA Bilateral Credit [Export Dev Canada 10/25/2028| Floating US$ |300,000,000| Maturity Quarterly 1.46% 1.55% 791 298,498
Foreign [USA Bilateral Credit [Export Dev Canada 7/25/2029 | Floating US$ |300,000,000| Maturity Quarterly 1.48% 1.65% 766 296,276
Foreign |Holland Bilateral Credit [Oriente Copper Netherlands B.V. 11/26/2032| Fixed US$ |874,959,000| Semi-annual Semi-annual 3.25% 5.42% 54,182 525,492
TOTAL 390,953| 2,124,583

69
CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Taxpayer s Principal Type of Payment of Nominal Effective Current Non-current
1D Number Country Maturity [Interes | Currency Amount amortization interest Interest Rate | Interest Rate balance balance
t Rate ThUS$ ThUS$

144-A REG.S Luxembourg | 11/4/2020 | Fixed US$ 1,000,000,000 | AtMaturity Semi-annual 3.75% 3.89% 400,826 –
144-A REG.S Luxembourg | 11/4/2021 | Fixed US$ 1,150,000,000 | AtMaturity Semi-annual 3.88% 4.02% 3,561 226,641
144-A REG.S Luxembourg | 7/17/2022 | Fixed US$ 1,250,000,000 | AtMaturity Semi-annual 3.00% 3.16% 2,522 411,352
144-A REG.S Luxembourg | 8/13/2023 | Fixed US$ 750,000,000 | AtMaturity Semi-annual 4.50% 4.35% 2,734 467,748
144-A REG.S Luxembourg | 7/9/2024 Fixed EUR 600,000,000 | AtMaturity Annual 2.25% 2.48% 3,594 697,098
BCODE-B Chile 4/1/2025 Fixed UF. 6,900,000 | AtMaturity Semi-annual 4.00% 3.24% – 259,457
144-A REG.S Luxembourg | 9/16/2025 | Fixed US$ 2,000,000,000 | AtMaturity Semi-annual 4.50% 4.75% 1,860 1,056,787
BCODE-C Chile 8/24/2026 | Fixed UF. 10,000,000 | AtMaturity Semi-annual 2.50% 2.48% 910 379,035
144-A REG.S Luxembourg | 8/1/2027 Fixed US$ 1,500,000,000 | AtMaturity Semi-annual 3.63% 4.20% 9,013 1,448,857
REG.S Luxembourg | 8/23/2029 | Fixed US$ 130,000,000 | AtMaturity Semi-annual 2.87% 2.98% 385 128,889
144-A REG.S Luxembourg | 9/30/2029 | Fixed US$ 1,100,000,000 | AtMaturity Semi-annual 3.00% 3.14% – 1,087,948
144-A REG.S Luxembourg | 1/14/2030 | Fixed US$ 1,000,000,000 | AtMaturity Semi-annual 3.15% 3.28% 6,420 989,397
144-A REG.S Luxembourg | 1/15/2031 | Fixed US$ 800,000,000 | AtMaturity Semi-annual 3.75% 3.80% 12,091 796,958
REG.S Luxembourg | 11/7/2034 | Fixed HKD 500,000,000 | AtMaturity Annual 2.84% 2.92% 1,652 63,911
144-A REG.S Luxembourg | 9/21/2035 | Fixed US$ 500,000,000 | AtMaturity Semi-annual 5.63% 5.78% 699 492,351
144-A REG.S Luxembourg | 10/24/2036 | Fixed US$ 500,000,000 | AtMaturity Semi-annual 6.15% 6.22% 13,359 496,634
REG.S Luxembourg | 7/22/2039 | Fixed AUD 70,000,000 | AtMaturity Annual 3.58% 3.65% 351 49,674
144-A REG.S Luxembourg | 7/17/2042 | Fixed US$ 750,000,000 | AtMaturity Semi-annual 4.25% 4.41% 6,496 733,779
144-A REG.S Luxembourg | 10/18/2043 | Fixed US$ 950,000,000 | AtMaturity Semi-annual 5.63% 5.76% 24,091 933,822
144-A REG.S Luxembourg | 11/4/2044 | Fixed US$ 980,000,000 | AtMaturity Semi-annual 4.88% 5.01% 19,344 961,709
144-A REG.S Luxembourg | 8/1/2047 Fixed US$ 1,250,000,000 | AtMaturity Semi-annual 4.50% 4.73% 9,324 1,206,523
144 – REG.S Luxembourg | 5/18/2048 | Fixed US$ 600,000,000 | AtMaturity Semi-annual 4.85% 4.91% 10,675 594,559
144-A REG.S Luxembourg | 2/5/2049 Fixed US$ 1,300,000,000 | AtMaturity Semi-annual 4.38% 4.97% 8,655 1,183,684
144-A REG.S Luxembourg | 1/30/2050 | Fixed US$ 1,900,000,000 | AtMaturity Semi-annual 3.70% 3.89% 11,843 1,835,908
TOTAL 550,405] 16,502,721

Nominal and effective interest rates presented above correspond to annual rates.

70

CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

As of December 31, 2019, the details of loans from financial institutions and bond obligations are as follows:

1213112019
Taxpayer 1D. Loans with financial . , Interest Principal . Paymentor | Nominal | esociyo Current Non-current
IAN Country DR Institution Maturiy Co |Curreney[ Amount Type of amortization o interest | arcos mozo | Balance balance

Rate Thus$ Thus$
97.036.000: — [Chis Bilateral Credit Santander Chile 3/zriz0z0 | Floaimg | US$ 100,000,000| Maturiy Semianmual | 2.36% 230% 100,597
97.018.001 — |Chie Bilateral Credit ¡Scotabank Chi artizo20 | Floaing | US$ 100,000,000| Maturiy Sembanmual | 2.34% 2.34% 100,758
97.018.001 — [Chie Bilateral Credit ¡Scotabank Chie 9/ta/2020 | Floaing | US$ 65,000,000| Matar Sembanmual | 240% 2.40% 65.473
97.018.001 — [Chie Bilateral Credit ¡Scotabank Chie 1212012020 | Floaing | US$ 300,000,000| Maturiy Sembannual | 2.63% 2.58% 300,241 –
Foreign USA Bilateral Credit MUFG Bank Lt 9/30/2021 | Floaing | US$ 250,000,000| Maturiy Semianmual | 2.96% 3.06% 3.409 249,690
Foreign USA Bilateral Credit Export Dev Canada 11/8/2021 | Floaing | US$ 300,000,000| Maturiy Sembanmual | 2.54% 2.12% 1,205 299,265
Foreign Cayman Island | Bilateral Credit Scotabank 4 Trust (Cayman) Lt arta/2022 | Floaing | US$ 300,000,000| Maturiy Quartery 2.65% 2.86% 1.701 298,894
Foreign Japan Bilateral Credit Vapan Bank Intematonal Cooperation. | 5/24/2022 | Floating | US$ 224,000,000| Halty early principal pay ments fom 2015 to the present. Sembanmual | 2.34% 2.59% 32,187 47.833
Foreign USA Bilateral Credit Export Dev Canada 1rizi2022 | Floaing | US$ 300,000,000| Maturiy Sembanmual | 2.83% 2.96% 3,774 299,560
Foreign Panama Bilateral Credit Banco Lainoamericano de Comercio | 12/18/2026 | Floaing | US$ 75,000,000 Matar Semianmual | 30% 3.28% 77 74,401
Foreign USA Bilateral Credit Export Dev Canada 1or2s/2028 | Floaing | US$ 300,000,000| Maturiy Sembanmual | 3.40% 3.52% 4,505 298,390
Foreign USA Bilateral Credit Export Dev Canada 1/25/2029 | Floaing | US$ 300,000,000| Maturiy Sembanmual | 342% 3.52% 4,303 296,200
Foreign Holland Bilateral Credit Oriente Copper Netherlands B.V. 1arzerzos2 | Fixed | US$ 874,959,000| Semi-annual Sembanmual | 3.26% 542% 47,829 544,104
TOTAL 566,144] 2,408,267]
Taxpayer Principal Nominal | Efiectve Current Non-current
Country Maturity — | InterestRate| Currency Amount Type of amortization | Paymentofinterest | interest | Interest balance balance
Number Rate Rate Thuss ThUS$
144-A REG.S Luxembourg 11/4/2020 Fixed US$ 1,000,000,000 At Maturity Semi-annual 3.75% 3.89% 396,742 –
144-A REG.S Luxembourg 11/4/2021 Fixed US$ 1,150,000,000 At Maturity Semi-annual 3.88% 4.02% 1,377 226,416
144-A REG.S Luxembourg 7/17/2022 Fixed US$ 1,250,000,000 At Maturity Semi-annual 3.00% 3.16% 4,978 410,882
144-A REG.S Luxembourg 8/13/2023 Fixed US$ 750,000,000 At Maturity Semi-annual 4.50% 4.74% 4,627 332,188
144-A REG.S Luxembourg 7/9/2024 Fixed EURO 00,000,000 At Maturity Annual 2.25% 2.48% 7,236 666,384
BCODE- Chile 4/1/2025 Fixed uE. 6,900,000 At Maturity Semi-annual 4.00% 3.24% 2,595 270,374
144-A REG.S Luxembourg 9/16/2025 Fixed US$ 2,000,000,000 At Maturity Semi-annual 4.50% 4.75% 14,003 1,055,236
BCODE-C Chile 8/24/2026 Fixed uE. 10,000,000 At Maturity Semi-annual 2.50% 2.48% 3,292 394,774
144-A REG.S Luxembourg 8/1/2027 Fixed US$ 1,500,000,000 At Maturity Semi-annual 3.63% 4.20% 22,607 1,443,875
REG.S Luxembourg 8/23/2029 Fixed US$ 130,000,000 At Maturity Semi-annual 2.87% 2.98% 1,328 128,808
144-A REG.S Luxembourg 9/30/2029 Fixed US$ 1,100,000,000 At Maturity Semi-annual 3.00% 3.14% 8,385 1,087,092
REG.S Luxembourg 11/7/2034 Fixed HKD 500,000,000 At Maturity Annual 0.00% 0.00% 275 63,593
144-A REG.S Luxembourg 9/21/2035 Fixed US$ 50,000,000 At Maturity Semi-annual 5.63% 5.78% 7,804 492,115
144-A REG.S Luxembourg 10/24/2036 Fixed US$ 50,000,000 At Maturity Semi-annual 6.15% 6.22% 5,713 496,544
REG.S Luxembourg 7/22/2039 Fixed AUD 70,000,000 At Maturity Annual 0.00% 0.00% 783 48,519
144-A REG.S Luxembourg 7/17/2042 Fixed US$ 750,000,000 At Maturity Semi-annual 4.25% 4.41% 14,465 733,450
144-A REG.S Luxembourg 10/18/2043 Fixed US$ 950,000,000 At Maturity Semi-annual 5.63% 5.76% 10,804 933,573
144-A REG.S Luxembourg 11/4/2044 Fixed US$ 980,000,000 At Maturity Semi-annual 4.88% 5.01% 7,481 961,425
144-A REG.S Luxembourg 8/1/2047 Fixed US$ 1,250,000,000 At Maturity Semi-annual 4.50% 4.73% 23,387 1,205,925
144 – REG.S Luxembourg 5/18/2048 Fixed US$ 00,000,000 At Maturity Semi-annual 4.85% 4.91% 3,438 594,487
144-A REG.S Luxembourg 2/5/2049 Fixed US$ 1,300,000,000 At Maturity Semi-annual 4.38% 4.97% 22,874 1,182,292
144-A REG.S Luxembourg 1/30/2050 Fixed US$ 900,000,000 At Maturity Semi-annual 3.70% 3.78% 8,393 889,406
TOTAL 572,587 13,617,358

Nominal and effective interest rates presented above correspond to annual rates.

71

CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The undiscounted amounts that the Corporation will have to disburse to settle the obligations with financial institutions, are as follows:

9/30/2020 Current Non-current

Effective Nominal Payments of Less than More than More than 5 | Non-current

Debtor’s Name Currency interest rate Rate Interest 90 days 90 days Current total| 1to 3 years | 3to 5 years years total
Scotiabank Chile US$ 1.15% 1.15% Semi-annual – 301,734 301,734 – – – –
Scotiabank 8 Trust (Cayman) Ltd US$ 1.11% 0.93% Quarterly 709 2,104 2,813 302,097 – – 302,097
Japan Bank International Cooperation US$ 1.19% 1.03% Semi-annual 16,332 16,248 32,580 32,251 – – 32,251
Export Dev Canada US$ 0.97% 0.91% Quarterly 716 2,078 2,794 302,710| – – 302,710
Banco Latinoamericano de Comercio US$ 1.77% 1.62% Semi-annual 619 616 1,235 2,471 2,474 76,845 81,790
Export Dev Canada US$ 1.47% 1.41% Quarterly 1,079 3,201 4,280 8,559 8,570 308,559 325,688
Export Dev Canada US$ 1.55% 1.46% Quarterly – 3,333 3,333 8,879 8,891 315,532 333,302
Export Dev Canada US$ 1.65% 1.48% Quarterly 1,137 3,374 4,511 9,023 9,035 317,997 336,055
BONO 144-A REG.S 2020 US$ 3.89% 3.75% Semi-annual 402,286 – 402,286 – – – –
BONO 144-A REG.S 2021 US$ 4.02% 3.88% Semi-annual 4,398 4,398 8,796 231,379 – – 231,379
BONO 144-A REG.S 2022 US$ 3.16% 3.00% Semi-annual – 12,374 12,374 424,849 – – 424,849
BONO 144-A REG.S 2023 US$ 4.35% 4.50% Semi-annual – 20,964 20,964 41,928 465,871 – 507,799
BONO 144-A REG.S 2025 US$ 4.75% 4.50% Semi-annual – 48,087 48,087 96,174 1,164,775 – 1,260,949
BONO 144-A REG.S 2027 US$ 4.20% 3.63% Semi-annual – 54,375 54,375 108,750 108,750 1,608,750 1,826,250
BONO REG.S 2029 US$ 2.98% 2.87% Semi-annual – 3,730 3,730 7,459 7,459 144,919 159,837
BONO 144-A REG.S 2029 US$ 2.92% 3.14% Semi-annual – 33,000 33,000 49,500 66,000 1,248,500 1,364,000
BONO 144-A REG.S 2030 US$ 3.15% 3.28% Semi-annual – 31,500 31,500 63,000 63,000 1,141,750 1,267,750
BONO 144-A REG.S 2031 US$ 3.80% 3.75% Semi-annual – 30,000 30,000 60,000 60,000 965,000 1,085,000
BONO 144-A REG.S 2035 US$ 5.78% 5.63% Semi-annual – 28,125| 28,125 56,250 42,188 795,313 893,751
BONO 144-A REG.S 2036 US$ 6.22% 6.15% Semi-annual 15,375 15,375| 30,750 61,500 61,500 853,625 976,625
BONO 144-A REG.S 2042 US$ 4.41% 4.25% Semi-annual – 31,875 31,875 63,750 63,750 1,291,875 1,419,375
BONO 144-A REG.S 2043 US$ 5.76% 5.63% Semi-annual 26,719 26,719 53,438 106,875 106,875 1,938,594 2,152,344
BONO 144-A REG.S 2044 US$ 5.01% 4.88% Semi-annual 23,888 23,888 47,776 95,550 95,550 1,911,613 2,102,713
BONO 144-A REG.S 2047 US$ 4.73% 4.50% Semi-annual – 56,250 56,250 112,500 112,500 2,487,500 2,712,500
BONO 144 REG.S 2048 US$ 4.91% 4.85% Semi-annual 14,550 14,550 29,100 58,200 58,200 1,269,300 1,385,700
BONO 144-A REG.S 2049 US$ 4.97% 4.38% Semi-annual – 56,875 56,875 113,750 113,750 2,636,563 2,864,063
BONO 144-A REG.S 2050 US$ 3.89% 3.70% Semi-annual – 70,300 70,300 140,600 140,600 3,622,350 3,903,550
Oriente Copper Netherlands B.V. US$ 5.42% 3.25% Semi-annual 35,527 35,022 70,549 136,773 131,042 439,945 707,760
Total TRUS$ 543,335 930,095 1,473,430 2,694,777] 2,890,780] 23,374,530| 28,960,087
BONO BCODE-B 2025 UE. 3.24% 4.00% Semi-annual 138,000 138,000 276,000 552,000| 7,452,000 . 8,004,000
BONO BCODE-C 2026 UE. 2.48% 2.50% Semi-annual . 248,457 248,457 496,913 496,914 10,248,457 11,242,284
Total U.F. 138,000 386,457 524,457 1,048,913] 7,948,914 10,248,457 19,246,284
Subtotal ThUS$ 5,027 14,076| 19,103 38,206| 289,534, 373,293 701,033
[ BONO 144-A REG.S 2024 [ EUR [ 2.48% ] 2.25% ] Annual . 13,500,000 13,500,000 27,000,000| 613,500,000 -| 640,500,000
Subtotal THUS$ . 15,812 15,812 31,623 718,553 – 750,176
[ BONO REG.S 2039 [ AUD [ 3.65% [ 3.58% [ Annual . 2,506,000 2,506,000 5,012,000 5,012,000] 105,084,000| 115,108,000
Subtotal ThUS$ – 1,796| 1,796 3,591 3,591 75,291 82,473
[ BONO REG.S 2034 [ HKD [ 2.92% 2.84% Annual 14,238,904 – 14,238,904 28,400,000 28,438,904| 642,077,808| 698,916,712
Subtotal ThUS$ 1,837 – 1,837 3,665| 3,670 82,849 90,184,
[Total ThUS$ 550,199 961,779 1,511,978 2,771,862 3,906,128] 23,905,963| 30,583,953

Nominal and effective interest rates presented above correspond to annual rates.

7
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

12/31/2019 Current Non-current
Debtor’s Name Currency | Effective interest rate a Payments of Interest | Less than 90 days | More than 90 days | Currenttotal | 1to3 years | 3to5years | More than 5 years | Non-current total
Santander Chile US$ 2.30% 2.36% Semi-annual 101,165] – 101,165 – – – –
Scotiabank Chile US$ 2.34% 2.34% Semi-annual 101,182 – 101,182 – – – –
Scotiabank Chile US$ 2.40% 2.40% Semi-annual 65,790 – 65,790 – – – –
Scotiabank Chile US$ 2.63% 2.68% Semi-annual – 304,054 304,054 – – – –
MUFG Bank LTD US$ 3.06% 2.96% Semi-annual 3,840] 3,737 7,577 261,212 – – 261,212
Export Dev Canada US$ 2.72% 2.54% Semi-annual – 7,757 7,757 307,715 – – 307,715
Scotiabank 8 Trust (Cay man) Ltd US$ 2.86% 2.65% Quarterly 1.988 6,053 8,041 312,062 – – 312,062
¡Japan Bank International Cooperation US$ 2.58% 2.34% Semi-annual – 33,720 33,720 49,137 – – 49,137
Export Dev Canada US$ 2.95% 2.83% Semi-annual 4,411 4,293 8,704 317,291 – – 317,291
Export Dev Canada US$ 3.52% 3.40% Semi-annual 5,213] 5,156 10,369 20,683 20,711 346,607 388,001
Export Dev Canada US$ 3.62% 3.42% Semi-annual 5,244] 5,187 10,431 20,804 20,833 351,897 393,534
Banco Latinoamericano de Comercio US$ 3.28% 3.10% Semi-annual – 2,380 2,380 4,722 3,545| 80,886 89,153
BONO 144-A REG.S 2020 US$ 3.89% 3.75% Semi-annual – 409,690 409,690 – – – –
BONO 144-A REG.S 2021 US$ 4.02% 3.88% Semi-annual – 8,796 8,796 285,777 – – 235,777
BONO 144-A REG.S 2022 US$ 3.16% 3.00% Semi-annual 6,187] 6,187 12,374 437,224 – – 437,224
BONO 144-A REG.S 2023 US$ 4.74% 4.50% Semi-annual 7,535| 7,535 15,070 30,138 349,940 – 380,078
BONO 144-A REG.S 2025 US$ 4.75% 4.50% Semi-annual 24,044 24,044 48,088 96,174 96,174 1,116,688 1,309,036
BONO 144-A REG.S 2027 US$ 4.20% 3.63% Semi-annual 27,188 27,188 54,376 108,750 108,750] 1,663,125 1,880,625
REG.S 2029 US$ 2.98% 2.87% Semi-annual 1.865 1,865| 3,730 7,459 7,459 148,649 163,567
BONO 144-A REG.S 2029 US$ 3.14% 3.00% Semi-annual 16,500] 16,500] 33,000 66,000 66,000 1,265,000 1,397,000
BONO 144-A REG.S 2035 US$ 5.78% 5.68% Semi-annual 14,068] 14,063] 28,126 56,250 56,250] 809,375 921,875
BONO 144-A REG.S 2036 US$ 6.22% 6.15% Semi-annual – 30,750 30,750 61,500 61,500 869,000 992,000
BONO 144-A REG.S 2042 US$ 4.41% 4.25% Semi-annual 15,938 15,938] 31,876 63,750 63,750] 1,323,760 1,451,250
BONO 144-A REG.S 2043 US$ 5.76% 5.68% Semi-annual – 53,438 53,438 106,875 106,875] 1,965,313 2,179,063
BONO 144-A REG.S 2044 US$ 5.01% 4.88% Semi-annual – 47,775 47,775 95,550 95,550] 1,935,500 2,126,600
BONO 144-A REG.S 2047 US$ 4.73% 4.50% Semi-annual 28,125 28,125 56,250 112,500 112,500] 2,543,750 2,768,750
BONO 144 REG.S 2048 US$ 4.91% 4.85% Semi-annual – 29,100 29,100 58,200 58,200] 1,283,850] 1,400,250
BONO 144-A REG.S 2049 US$ 4.97% 4.38% Semi-annual 28,438| 28,438 56,876 113,750 113,750] 2,693,438 2,920,988
BONO 144-A REG.S 2050 US$ 3.78% 3.70% Semi-annual 11,100 22,261 33,361 66,782 66,782 1,745,911 1,879,476
Oriente Copper Netherlands B.v. US$ 5.42% 3.25% Semi-annual 72,705 72,705 141,137 135,320] 537,640 814,097
Total TRUS$ 469,816 1,216,735 1,686,551 3,151,442 1,543,889] 20,680,379 25,375,711
[Bono BCODE-8 2025 Tur] 3.24% [4.00% Semiannual 138,000] 136,000] 276,000 552,000 552,000] 7,038,000] 8,142,000
[ono Bcone-c 2026 [ur] 2.48% | 2.50% Semizannual 124,228 124,228 248,457 496,913 496,913 10,496,914 11,490,740
Total U.F. 262,228 262,228 524,457 1,046,913 1,046,913] 17,534,914 19,632,740
Subtotal US$ 9,915 9,915 19,830 39,661 39,660] 662,997 742,318
[BONO 144-A REG.S 2024 [_ euro ] 2.48% 225% Annual – 13.500,000/ 13,500,000] —27,000.000| 27.000.000 600.000,000 654.000.000
Subtotal TRUS$ – 15,138] 15,138 30,276 30,276] 672,798 733,350
[Recs 2039 [au] 3.65%] 3.58% Annual – 2.506,000| 2,506,000 5,012,000 5,012,000 107.590,000] 17,614,000
Subtotal TRUS$ – 1,755] 1,755 3,509 3,509] 75,332 82,350
[Recs 2034 [o] 2.92%] 2.84% Annual – 14,236,904) 14,238,904| 28,400.000| 28,438,904 642,077,808 698,916,712
Subtotal TRUS$ – 1,820] 1,829 3,648 3,653] 82,468 89,769
Total TRUS$ 479,731 1,245,372] — 1,725,103 3,228,536 1.620,987| 22,173,974 27,023,498

Nominal and effective interest rates presented above correspond to annual rates.

73
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The table below details changes in CODELCO’s financing activities in the statement of cash flow, including
both cash and non-cash changes for the nine-month period ended September 30, 2020 and the year ended

December 31, 2019:
Changes that do not represent cash flow
Flows of Effective Interest Final Balance at
Liabilities for Initial Balance at cash Financial Cost Exchange Fair Value accretion/amortization Other
financing activities 1/1/2020 From Used Total (1) Difference Adjustment not cash flow related 9/30/2020
ThUS$ ThUS$ ThUS$ ThUs$ ThUS$ ThUs$ ThUS$ ThUs$ ThUS$ ThUS$
Loans with financial insítutons 3,074,411 565,000 | (1,186,599) (621,599)| 58,930 – 2,044 1,750 2,515,536
Bond obligatons 14,189,945 | 2,931,000 (534,583)| 2,396,417 510,381 7,957 – (51,574)| 17,053,126
Hedge obligatons 157,826 – (22,178)| — (22,178) 17,781 (17,519)| (16,829) – 59,989 179,070
Paid dividends – – – – – –
Financial assets for hedge derivatives (82,584)| – – – 9,562 39,363 (27,683)| (61,342)!
Leases 432,871 (100,744) (100,744)| 15,553 (12,079)| – 59,792 395,393
¡Capital contribution – – – – –
Other 58,864 – (57,470) (57,470) – – – – 52,783 54,177
Total liabilities from financing activities 17,831,333 | 3,496,000 | (1,901,574)| 1,594,426 602,645 (12,079)| 22,534 (49,530)| 146,631 20,135,960
Changes that do not represent cash flow
Flows of Financial Cost Fair Value Effective Interest Final Balance at
Liabilities for Initial Balance at cash (0) Exchange Adjustment — | accretion/amortization Other
financing activities 1/11/2019 From Used Total Difference not cash flow related 12/31/2019
ThUS$ ThUS$ ThUS$ ThUs$ ThUS$ ThUs$ ThUS$ ThUs$ ThUS$ ThUS$

Loans with financial insítutons 2,511,949 840,000 (386,625) 453,375 104,592 – 1,606 2,889 3,074,411
Bond Obligatons 12,745,736 | 3,543,199 | (2,610,321) 932,878 591,920 (45,137) – (35,452) 14,189,945
Hedge obligalons 116,132 – (21,167) (21,167)| 21,556 13,142 27,575 – 588 157,826
Paid dividends – – – – – – –
Financial assets for hedge derivatives (107,700)! – – – 31,438 (6,322) – (82,584)|
Leases 107,839 – (148,181) (148,181)| 31,416 (18,114) – 459,911 432,871
[Capital contribution – 400,000 – 400,000 – – –
Other 64,343 – (75,483) (75,483) 51,082 – – – 18,922 58,864
Total liabilities from financing activities 15,438,299 | 4,783,199 | (3,241,777)| 1,541,422 800,566. (18,671)| 21,253 (33,846)| 482,310 17,831,333

(1) The finance costs consider the capitalization of interest, which for the nine month periods ended
September 30, 2020 and 2019, amounted to TRUS$155,750 and ThUS$269,215 respectively.

13. Fair Value of financial assets and liabilities

The carrying amount of financial assets is a reasonable approximation to their fair value, therefore, no
additional disclosures are required in accordance with IFRS 7 with respect thereto.

Regarding financial liabilities, the following table shows a comparison as of September 30, 2020 between
the carrying amount and the fair value of financial liabilities other than those whose carrying amount is a

reasonable approximation of fair value.

Comparison value book vs fair value | Accounting treatment for Carmina Fair value
as of September 30, 2020 valuation ThUS$ ThUS$
Financial liabilities:
Bond Obligations Amortized cost 17,053,126 19,541,220

74

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

14. Fair value hierarchy

The estimated fair value for the Corporation’s portfolio of financial instruments is based on valuation
techniques and observable inputs. Considering the hierarchy of the data used in these valuation techniques,
the assets and liabilities measured at fair value can be classified into the following levels:

+» Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.

+ Level 2: Inputs other than quoted prices included within Level 1 that are observable for the assets or
liabilities, either directly (i,e, as prices) or indirectly (i,e, derived from prices).

+ Level 3: Inputs are significant unobservable inputs for the asset or liability.

The following table presents financial assets and liabilities measured at fair value as of September 30, 2020:

Financial instruments measured at 9/50/2020
fair value Level 1 Level 2 Level 3 Total
ThUS$ ThUS$ ThUS$ ThUS$

Financial Assets

Provisional price sales contracts – 699,646 – 699,646
Cross Currency Swap – 61,342 – 61,342
Mutual fund units 11,882 – – 11,882
Metal futures contracts 276 – – 276
Financial Liabilities

Metal futures contracts 2,038 6,050 – 8,088
Cross Currency Swap – 179,069 179,069

There were no transfers between the different levels during the nine month period ended September 30,
2020.

15. Trade and other payables

The detail of trade and other current payables as of September 30, 2020 and December 31, 2019, is as

follows:
Currents
Items 9/30/2020 12/31/2019
ThUS$ ThUS$

Trade payables 853,015 1,150,047
Payables to employees 18,895 8,390
Withholdings 110,240 113,147
Withholding taxes 42,336 76,387
Other payables 90,786 72,944
Total 1,115,272 1,420,915

75
CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

16. Other provisions

The detail of other current and non-current provisions as of September 30, 2020 and December 31, 2019,

is as follows:
Current Non-current
Other Provisions 9/30/2020 | 12/31/2019 | 9/30/2020 | 12/31/2019
ThUS$ ThUS$ ThUS$ ThUS$

Sales-related provisions (1) 22,588 2,932

Operating (2) 301,919 260,973
Law No. 13196 110,634 109,643 – –
Other provisions 71,159 128,429 421 2,239
Onerous Contract (3) – 195 – 81
Decommissioning and restoration (4) – 2,026,683 2,038,483
Legal proceedings – – 57,184 49,684
Total 506,300 502,172 2,084,288 2,090,487

(1) Corresponds to sales-related accruals, which includes charges for freight, loading, and unloading that
were not invoiced at the end of the period.

(2) Corresponds to a provision for customs duties, freight on purchases, electricity, among others.

(3) Corresponds to a provision recognized for an onerous contract with Copper Partners Investment
Company Ltd, See Note 28 b).

(4) Corresponds to the provision for future decommissioning and site restoration costs primarily related to
tailing dams, closures of mine operations and other mining assets. The amount of the provision is the
present value of future expected cash flows discounted at a pre-tax rate of 1.05% for the obligations in
Chilean currency and 1.86% for the obligations in U.S. dollar. Both, discount rates reflect the
corresponding assessments of the time value of money and the risks specific to the liability. The discount
rate does not reflect risks for which future cash flow estimates have been made. The discount period
varies between 9 and 54 years.

The Corporation determines and recognized this liability in accordance with the accounting policy

described in Note 2, letter p) on Significant Accounting Policies.

Changes in Other provisions, were as follows:

1/1/2020
9/30/2020
Other leciont
Changes mos Decommissioning . .
Provisions, non- . Contingencies Total
and restoration
current
Thus$ ThUus$ ThUs$ Thus$
Opening balance 2,320 2,038,483 49,684 2,090,487
Closing provision adjustment – 1,686 1,686
Financial expenses 22,452 – 22,452
Pay ment of liabilities – – (1,135) (1,135)
Foreign currency translation (7) (35,667) (3,630) (39,304)
Provision (decrease) (2,375) – – (2,375)
Other increases (decreases) 483 (271) 12,265 12,477
Closing Balance 421 2,026,683 57,184 2,084,288

76

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

17. Employee benefits
a. Provisions for post-employment benefits and other long term benefits

Provision for post-employment benefits mainly corresponds to employee severance indemnities and
medical care plans. The provision for severance indemnities recognizes the contractual obligation that
the Corporation has with its employees/retirees regardless of the reason for employee’s departure. The
provision for medical care plans recognizes the contractual obligation that the Corporation has with its
retirees to cover their medical care costs.

Both long-term employee benefits are stated in the terms of employment contracts and collective
bargaining agreements as agreed to by the Corporation and its employees.

These defined benefit liabilities are recognized in the statement of financial position, at the present value
of the defined benefit obligation. The discount rate applied is determined by reference to the market
yields of government bonds in the same currency and estimated term of the post-employment benefit
obligations.

The defined benefit obligations are denominated in Chilean pesos, therefore the Corporation is exposed
to foreign exchange rate risk.

Actuarial gains and losses resulting from changes in actuarial assumptions and experience adjustments
are recognized in other comprehensive income and are not subsequently reclassified to profit or loss.

For the nine month period ended September 30, 2020, there were no significant changes in post-
employment benefits plans.

The following actuarial assumptions were used in the actuarial calculation of the defined benefit plans:

9/30/2020 12/31/2019
Assumptions Retirement Health plan Retirement Health plan
plan plan

Annual Discount Rate 3.68% 3.68% 3.68% 3.68%
Voluntary Annual Turnover Rate for Retirement (Men) 5.00% 5.00% 5.00% 5.00%
Voluntary Annual Turnover Rate for Retirement (Women) 4.70% 4.70% 4.70% 4.70%
Salary Increase (real annual average) 3.26% – 3.26% –
Future Rate of Long-Term Infation 3.00% 3.00% 3.00% 3.00%
Infation Health Care – 5.05% – 5.05%
Mortality tables used for projections CB14-RV14 | CB14-RV14 | CB14-RV14 | CB14-RV14
Average duration of future cash flows (years) 7.68 16.89 7.21 17.13
Expected Retirement Age (Men) 60 60 60 60
Expected Retirement Age (Women) 59 59 59 59

The discount rates correspond to the rates in the secondary market of government bonds issued in Chile.
The annual inflation corresponds to the long-term expectation set by the Central Bank of Chile. The

17
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

turnover rates were determined using the past three years of historical experience of the Corporation’s
employee departure behavior. The expected rate of salary increases has been estimated using the long-
term behavior of historical salaries paid by the Corporation. The mortality tables used were those issued
by the CMF, which are considered an appropriate representation of the Chilean market given the lack of
comparable statistical series to develop independent studies. The period over which the obligation ¡is

being amortized corresponds to the estimate of the period over which the cash flows will occur.

b. The detail of current and non-current provisions for employment benefits as of September 30, 2020 and

December 31, 2019, is as follows:

Current Non-current
Accrual for employee benefits 9/30/2020 12/31/2019 | 9/30/2020 12/31/2019
ThUS$ ThUS$ ThUS$ ThUs$

Employee performance bonuses per collective agreements 111,117 181,040 – –
Severance indennity provision 20,704 21,904 577,526 704,877
Bonus 26,950 35,195 – –
Vacation 135,099 143,971 – –
Medical care programs (1) 530 497 561,144 561,709
Retirement plans (2) 18,481 37,479 8,020 8,181
Other 11,357 15,479 5,850 8,590
Total 324,238 435,565 1,152,540 1,283,357

(1) Corresponds to a provision recognized for the obligations with health care institutions as agreed

with current and former employees.

(2) Correspond to the provision recognized for early retirement benefits provided to employees.

The reconciliation of the present value of the retirement plan and post-employment benefit obligation, is

as follows:
1/1/2020 1/1/2019
9/30/2020 12/31/2019
Movements Retirement Health plan Retirement Health plan
plan plan
ThUs$ ThUs$ ThUs$ ThUs$
Opening balance 726,781 562,206 829,507 496,783
Service cost 39,516 46,757 51,086 39,980
Financial cost 2,398 1,855 15,512 9,290
Paid contributions (131,480) (22,965) (115,970) (44,275)
Actuarial losses 489 1,799 4,828 93,889
Subtotal 637,704 589,652 784,963 595,667
Gains on foreign exchange rate (39,474) (27,978) (58,182) (33,461)
Final Total 598,230 561,674 726,781 562,206

The balance of the defined benefit liability as of September 30, 2020, comprises a short term portion of
ThUS$20,704 and ThUS$530 for the severance indemnity and the medical care plan, respectively. The
expected amount of the defined benefit liability projected at September 30, 2021, consists of

78

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

ThUS$651,947 for the severance indemnity and ThUS$539,127 for the medical care plan. The expected
monthly average future disbursements related to defined benefit plans are of ThUS$1,725 for severance
indemnity and of ThUS$44 for medical care.

On the other hand, the technical revaluation of the liability (actuarial gain / loss defined under |AS19) has
been carried out for severance benefits for years of services as of September 30, 2020, charged to
equity, which is broken down into an actuarial loss for ThUS$489, corresponding to an experience loss.
Similar to the latter case, for the obligation generated by health benefit plans, an actuarial loss of
ThUS$1,799 has been determined, made up of an adjustment for experience.

The following table sets forth the sensitivity analysis of the value of each line item for a change in
estimates, respectively, from the medium (used in the estimate recorded) to the low and from the medium
to the high; the second to the last column represents the change between the low and medium and the
last column represents the change between the medium and the high:

Severance Benefits for Years of Service Low Medium High Reduction Increase

Financial efíecton interest rates 3.430% 3.680% 3.930% 1.37% -1.32%
Financial effecton the real increase in income 3.008% 3.258% 3.508% -1.17% 1.21%
Demographic effect of job rotations 4.470% 4.970% 5.470% 0.95% -0.69%
Demographic eftecton mortality tables -25.00%| CB14-RV14, Chile 25.00% -0.04% 0.05%
Health Benefits and Other Low Medium High Reduction Increase

Financial efiecton interest rates 3.430% 3.680% 3.930% 4.66% -4.30%
Financial efiecton health inflation 4.550% 5.050% 5.550% -3.43% 3.64%
Demographic effect, planned retirement age 58/57 60/59 62/61 3.87% -3.90%
Demographic eftecton mortality tables -25.00%| CB14-RV14, Chile 25.00% 11.96% -8.26%

Cc. Retirement benefits provision

The Corporation under its operational optimization programs seeks to reduce costs and increase labor
productivity, and through the incorporation of modern technologies and/or best management practices
has established employee retirement programs by making corresponding modifications to employment
contracts or collective bargaining agreements, with benefits encouraging early retirement. The early
retirement plans are recognized as a liability and expense as the Corporation can no longer withdraw
the offer of those benefits.

As of September 30, 2020 and December 31, 2019, the retirement plan provision current balance was
ThUS$18,481 and ThUS$37,479, respectively, while the non-current balance was ThUS$8,020 and
ThUS$8,181, respectively. The non-current amounts recognized have been determined using a discount
rate equivalent to that used for calculating employee benefits provisions and whose outstanding
balances are part of the balances as of September 30, 2020 and December 31, 2019.

79
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

d. Employee benefits expenses

The employee benefit expenses recognized for the nine month periods ended September 30, 2020 and
2019, are as follows:

Expense by Nature of 1/11/2020 1/11/2019 7/1/2020 7/1/2019
Employee Benefits 9/30/2020 9/30/2019 9/30/2020 9/30/2019
ThUus$ ThUus$ ThUs$ ThUs$
Benefits – Short term 961,938 1,182,374 335,913 389,726
Benefits – Post employment 46,757 16,952 13,467 7,969
Benefits – Early retirement 80,950 55,107 26,794 32,173
Benefits by years of service 39,516 38,469 15,439 11,047
Total 1,129,161 1,292,902 391,613 440,915

18. Equity

The Corporation’s total equity as of September 30, 2020 is ThUS$11,676,822 (ThUS$11,634,677 as of
December 31, 2019 and ThUS$11,570,069 as of September 30, 2019).

In accordance with article 6 of Decree Law 1350 of 1976, it is established that, before March 30 of each
year, the Board must approve the Corporation’s Business and Development Plan for the next three-year
period. Taking that plan as a reference, and keeping in mind the Corporation’s balance sheet for the
immediately preceding year and aiming to ensure its competitiveness, before June 30 of each year the
amounts that the Corporation shall allocate to the formation of capitalization funds and reserves shall be
determined by decree from the Ministries of Mining and Treasury.

Net income shown in the balance sheets, after deducting the amounts referred to in the previous paragraph,
shall belong to the State and becomes part of the Nation’s general income.

Pursuant to the Exempt Decree No. 184 of June 27, 2014 of the Ministry of Finance, the Corporation was
authorized to capitalize US$200 million of the net profit of the financial statements as of December 31,
2013.Those resources were charged to the profits of 2014.

On October 24, 2014, the President of the Republic of Chile signed Law No. 20790. Such Law sets forth an
extraordinary capital contribution of up to US$3 billion for the Corporation during the period of 2014-2018.
The resources obtained from such capital contribution, together with the capitalization of the profits obtained
during such period — up to US$800 million — generated in that period, would serve to boost the Investment
Plan in mining projects, sustainability, mining development and renewal of equipment and industrial plants.
At December 31, 2014, there were no capitalized resources under such statute.

On October 16, 2018, the Ministry of Finance issued Exempt Decree 311 in which it has an extraordinary
capital contribution for Codelco pursuant to Law No. 20,790 of US$1,000 million, which will be made in a
first part for US$600 million and in a second part for US$400 million, and which were received on December
26, 2018 and February 26, 2019 respectively.

80
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

As of 2019, the Corporation has established that dividend payments will not be made as long as there are
prepayments of dividends paid in excess.

As of September 30, 2020 and December 31, 2019, the Corporation has not paid dividends, due to the fact
that in 2018 there were advances of dividends paid in excess as follows:

ThUS$
Dividends payable in 2017 295,842
Advance dividends in 2018 155,719
Advance dividends overpaid in 2018 150,900

Total dividends paid as of December 31, 2018 602,461

The consolidated statement of changes in equity discloses the changes in the Corporation’s equity.

The movement and composition of other equity reserves is presented in the consolidated statement of
changes in equity.

Reclassification adjustments from other comprehensive income to profit or loss resulted in credits of
ThUS$650 and ThUS$3,058 for the nine month periods ended September 30, 2020 and 2019, respectively.

a) Other reserves

The detail of other reserves as of September 30, 2020 and December 31, 2019, is as follows:

Other Reserves 9/30/2020 | 12/31/2019
ThUus$ ThUS$
Reserve on exchange differences on translation (3,838) (6,672)
Reserve of cash flow hedges (2,138) 19,506
Other miscellaneous reserves 4,962,393 4,962,393
Reserve ofremeasurement of defined benefit plans (306,552) (305,770)
Other reserves 622,232 622,290
Total other reserves 5,272,097 5,291,747

b) Non-controlling interests

The detail of non-controlling interests, included in equity and profit or loss, as of and for each reporting
period, is as follows:

Company cination Net equity Income (loss) Income (loss)
9/30/2020 12/31/2019 9/30/2020 12/31/2019 1/1/2020 1/1/2019 7/1/2020 7/1/2019
9/30/2020 9/30/2019 9/30/2020 9/30/2019
Y % ThUS$ ThUS$ Thus$ ThUS$ ThUS$ ThUSs$
Inversiones Gacrux SpA 32.20% 32.20% 919,428 919,764 7,231 7,552 6,492 3,236
Otros – – 30 (m 36 (21) 4 (44)
Total 919,458 919,757 7,267 7,531 6,496 3,192

81
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

For the nine-month period ended September 30, 2020, Inversiones Gacrux SpA, made an equity

distribution of ThUS$7,567 paid to non-controlling interests.

The percentage of non-controlling interest in Inversiones Mineras Becrux SpA (previously Inversiones
Mineras Acrux SpA) generates a non-controlling interest in our subsidiary Inversiones Gacrux SpA,
which presents the following figures relating to its statement of financial position, statement of
comprehensive income and cash flows:

19. Revenue

has 9/30/2020 | 12/31/2019
Assets and liabilities Thus$ Thus$
Current Assets 240,728 227,367
Non-current assets 2,852,587 2,855,708
Currentliabilities 188,968 157,345
Non-currentliabilities 536,709 554,890
1/1/2020 1/1/2019 7/1/2020 7/11/2019
Results 9/30/2020 9/30/2019 9/30/2020 9/30/2019
ThUS$ ThUS$ ThUS$ ThUS$
Revenues 478,203 509,325 219,411 138,649
Expenses (473,838) (503,523) (205,510) (134,347)
Profitofthe period 4,365 5,802 13,901 4,302
1/1/2020 1/1/2019
Cash flow 9/30/2020 9/30/2019
ThUus$ ThUS$
Net cash fow from operating activities 29,128 85,789
Net cash flow from investing activities 87,173 44,015
Net cash flow from (using) financing activities (43,355) (92,266)

Revenues for the nine month and three month periods ended September 30, 2020 and 2019, are as follows:

1/1/2020 1/1/2019 7/1/2020 7/11/2019
Item 9/30/2020 9/30/2019 9/30/2020 9/30/2019
ThUS$ ThUS$ ThUS$ ThUS$
Revenue from sales ofown copper 7,605,362 7,259,288 3,345,735 2,380,076
Revenue from sales of third-party copper 783,692 723,580 339,991 236,561
Revenue from sales of molybdenum 382,985 456,927 120,215 139,462
Revenue from sales of other products 453,621 359,357 182,483 129,680
Gain in futures market 2,979 9,032 1,358 5,656
Total 9,228,639 8,808,184 3,989,782 2,891,435

The Corporation’s revenue is recognized at a point in time.

The breakdown of revenue ¡is presented in explanatory note No.23 Operating Segments.

82
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

20. Expenses by nature

Expenses by nature for the nine-month and three-month periods ended September 30, 2020 and 2019, are

as follows:
1/1/2020 1/1/2019 7/1/2020 7/11/2019
Item 9/30/2020 9/30/2019 9/30/2020 9/30/2019
ThUS$ ThUS$ ThUS$ ThUS$
Short-term benefits to employees 961,938 1,182,374 335,913 389,726
Depreciation 1,785,346 1,585,015 622,231 577,507
Amortization 1,784 412 686 134
Total 2,749,068 2,767,801 958,830 967,367

21. Other income and expenses by function

Other income and expenses by function for the nine-month and three-month periods ended September 30,
2020 and 2019, are as follows:

a)

Other income by function

1/1/2020 1/11/2019 7/1/2020 7/1/2019
Item 9/30/2020 9/30/2019 9/30/2020 9/30/2019
ThUS$ ThUS$ ThUS$ ThUS$
Penaltes to suppliers 7,391 13,318 915 4,209
Delegated Administration 2,976 3,672 968 1,125
Miscellaneous sales (net) 18,929 30,664 7,432 4,633
Customer recovery – 7,866 – (41)
Reversal of provisions 810 – 810
Gain on sale of shares of related companies (Note 9) – 103,151 – 103,151
Material Return 2,287 – (549) –
Insurance case compensation 10,962 – 10,962 –
Other miscellaneous income 32,708 47,500 (7,583) 2,381
Total 75,253 206,981 12,145 116,268
Other expenses by function
1/1/2020 1/1/2019 7/1/2020 7/1/2019
Item 9/30/2020 9/30/2019 9/30/2020 9/30/2019
ThUS$ ThUS$ ThUs$ ThUs$
Law No. 13196 (696,296) (686,715) (284,366) (230,018)
Research expenses (34,810) (57,354) (7,976) (18,307)
Union negotiation termination bonus (3,045) (109,845) (3,038) 931
Exitemployee plan (80,950) (55,107) (26,794) (32,173)
Write-off of investment projects (66) (3,905) (5) –
Write-off of property, plant 8 equipment (2,653) (24,618) (864) (376)
Medical care plan (46,757) (16,952) (13,468) (7,969)
Inventory write-off (963) (7,178) (507) (6,420)
Inventory obsolescence (18,283) – (10,255) –
Loss for onerous contract – – 135 –
Customer bad debt – (1,307) – –
Contingency expenses (12,728) (7,105) (2,427) (1,384)
Fixed indirect costs, low production level (46,763) (312,234) (21,267) (30,341)
Other (26,531) (45,813) (6,141) (16,750)
Total (969,845)| (1,328,133) (376,973) (342,807)

83
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

22.

23.

Cc) Law No. 13196

The Corporation is subject to Law No. 13196, which mandates the payment of a 10% tax over the foreign
currency return on the actual sale revenue of copper production, including its by-products.

On January 27, 2017, Law No. 20989, article 3, establishes changes in the application of Law No. 13196
as of January 1, 2018, through which the Corporation will deposit annually, no later than December 15 of
each year, the funds established in article 1 in that law.

On September 26, 2019, Law No. 21174 was published, which repeals Law No. 13196 and establishes that
the 10% tax to the tax benefit provided by the Corporation will subsist for a period of nine years, decreasing
from the tenth year 2.5% per year until reaching 0% at the beginning of the thirteenth year. The validity of
this law is as of January 1, 2020, maintaining the payment annually at a date no later than December 15 of
each year.

On March 23, 2020, the Ministry of Finance issued Ordinary Letter No. 843, which modifies the payment
method of the funds related to Law 13196, in order to address funds to meet national needs generated by
the COVID-19 crisis. Said Official Letter establishes the payment of funds owed to the Treasury for the
application of Law No. 13196, equivalent to ThUS$240,168 (contribution for December 2019, January and
February 2020), before March 31 this year. Subsequently and from the month of April, the Corporation
should carry out the monthly transfer of the corresponding resources according to their recordkeeping, within
a period not exceeding the last day of the month following its booking.

Finance costs

The detail of finance costs for the nine-month and three-month periods ended September 30, 2020 and
2019, is as follows:

1/1/2020 1/1/2019 7/1/2020 7/1/2019
Item 9/30/2020 9/30/2019 9/30/2020 9/30/2019
ThUS$ ThUS$ ThUS$ ThUs$
Bond interest (399,326) (229,041) (147,908) (88,329)
Bank loan interest (45,061) (38,304) (13,314) 7,813
Unwinding of discount on severance indemnity provision (2,889) (9,940) (1,123) (2,922)
Unwinding of discount on other non-current provisions (25,272) (33,482) (8,564) (11,023)
Other (47,826) (49,337) (11,466) (5,504)
Total (520,374) (360,104) dez 375) (99,965)

Operating segments
The Corporation has defined its Divisions as its operating segments in accordance with the requirements of

IFRS 8, Operating Segments. The revenues and expenses of the Head Office are allocated among the
defined operating segments.

84
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The mining deposits in operation, where the Corporation conducts its extractive and processing activities
are managed by the following Divisions: Chuquicamata, Radomiro Tomic, Ministro Hales, Gabriela Mistral,
Salvador, Andina and El Teniente. In addition, the smelting and refining activities are managed at the
Ventanas Division. All these Divisions have a separate operational management, which reports to the Chief
Executive Officer, through the North and South Central Vice-President of Operations, respectively.

The information on each Division and their corresponding mining deposits is as follows:

Chuquicamata

Types of mine sites: Open pit mines and underground mines

Operating: since 1915

Location: Calama — Region |

Products: Electro refined and electrolytic (electro-obtained) copper cathodes and copper concentrate

Radomiro Tomic

Types of mine sites: Open pit mines

Operating: since 1997,

Location: Calama — Region |

Products: Electro refined and electrolytic (electro-obtained) copper cathodes and copper concentrate

Ministro Hales

Type of mine: Open pit mine

Operating: since 2014

Location: Calama — Region |

Products: Calcined copper, copper concentrates

Gabriela Mistral

Type of mine: Open pit mine

Operating: since 2008

Location: Calama — Region |

Products: Electrolytic (electro-obtained) cathodes

Salvador

Type of mine: Underground mine and open pit mine

Operating: since 1926

Location: Salvador — Region |1l

Products: Electro refined and electrolytic (electro-obtained) copper cathodes and copper concentrate

Andina

Type of mines: Underground and open pit mines
Operating: since 1970

Location: Los Andes – Region V

Product: Copper concentrate

85
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

El Teniente

Type of mine: Underground mine

Operating: since 1905

Location: Rancagua — Region VI

Products: Fire-refined copper and copper anodes

a) Allocation of Head Office revenue and expenses

Revenue and expenses controlled by the Head Office are allocated to the Divisions based on following
criteria.

The main items are assigned based on the following criteria:

Revenue and Cost of Sales of Head Office commercial transactions

+ Allocation to the operating segments is made in proportion to revenues of each Division.
Other income, by function

+ Other income by function, associated and identified with each Division, ¡is directly allocated.

+ Recognition of realized profits and other income by way of subsidiaries are allocated in proportion to
the revenues of each Division.

+ The remaining other income is allocated in proportion to the aggregate of balances of “other income”
and “finance income” of each Division.

Distribution costs

+ Expenses associated and identified with each Division are directly allocated.
+ Distribution costs of subsidiaries are allocated in proportion to the revenues of each Division.

Administrative Expenses

+ Administrative expenses associated and identified with each Division are directly allocated,

+ Administrative expenses recorded in cost centers associated with the sales function and
administrative expenses of subsidiaries are allocated in proportion to the revenues of each Division.

+ Administrative expenses recorded in cost centers associated with the supply function are allocated
in proportion to inventory balances in warehouse in each Division.

+ The remaining administrative expenses are allocated in proportion to operating cash outflows of each
Division.

86
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Other Expenses, by function

+ Other expenses associated and identified with each Division are directly allocated.

+ Expenses for pre-investment studies and other expenses by function of subsidiaries are allocated in
proportion to the revenues of each Division.

Other gains

+ Other gains associated and identified with each Division are directly allocated.
+ Other gains of subsidiaries are allocated in proportion to the revenues of each Division.

Finance Income

+ Finance income associated and identified with each Division is directly allocated.

+ Finance income of subsidiaries is allocated in proportion to the revenues of each Division.

+ The remaining finance income is allocated in relation to the operating cash outflows of each Division.

Finance costs

+ Finance costs associated and identified with each Division are directly allocated.
+ Finance costs of subsidiaries are allocated in proportion to the revenues of each Division.

Share in profit (loss) of associates and joint ventures accounted for using the equity method

+ Share in profit or loss of associates and joint ventures identified for each Division is directly allocated.

Foreign exchange differences

+ Foreign exchange differences identifiable with each Division are directly allocated.

. Foreign exchange difference of subsidiaries is allocated in proportion to the revenues of each

. The remanino foreign exchange differences are allocated in relation to operating cash outflows of
each Division.

Contribution to the Chilean Treasury under Law No. 13196

+ The amount of the contribution is allocated and accounted for in proportion to the invoiced and

recorded amounts for copper and sub-product exports of each Division, that are subject to the
surcharge.

87
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Income tax benefit (expense)

+ Corporate income tax under D.L. 2398 and specific mining tax are allocated based on the income
before income taxes of each Division, considering for this purpose the income and expenses
allocation criteria of the Head Office and subsidiaries mentioned above.

+ Other tax expenses are allocated in proportion to the corporate income tax, specific mining tax and
tax under D.L. 2398 of each Division.

b) Transactions between segments

Transactions between segments mainly related to products processing services (or tolling services), are
recognized as revenue for the segment rendering the tolling services and as the cost of sales for the
segment that receives the service. Such recognition is made in the period in which these services are
rendered, as well as ¡ts elimination in the consolidated corporate financial statements.

Additionally, the reallocation of the profit and loss assumed by Ventanas Division, associated with the
corporate mineral processing contract between Codelco and Enami, in which a distribution is applied
based on the revenue of each division is included as a transaction between segments.

c) Cash flows by segments
The operating segments defined by the Corporation, maintains a cash management function which refers
mainly to operational activities that need to be covered periodically with funds constituted in each of
these segments and whose amounts are not significant in relation to corporate balances of cash and
cash equivalents.

Conversely, activities such as obtaining financing, investment and payment of relevant financial
obligations are mainly based at the Head Office.

88
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The following tables details the financial information organized by operating segments:

From 1/1/2020
9/30/2020
Ss Chuquicamata R. Tomic Salvador Andina El Teniente Ventanas G. Mistral M. Hales Total Segments| Head Office Total
‘egments Consolidated
ThUS$ ThUS$ ThUS$ ThuS$ ThUuS$ ThUS$ ThUS$ ThUS$ ThUuS$ ThUS$ ThUS$

Revenue from sales of own copper 2,551,728 1,077,357 423,993 777,367 1,696,574 48,956 438,744 590,674 7,605,393 (31) 7,605,362
Revenue from sales of third-party copper 2,226 – (230) – – 18,966 – – 20,962 762,730 783,692
Revenue from sales of molybdenum 222,519 8,845 7,292 31,959 104,688 – – – 375,303 7,682 382,985
Revenue from sales of other products 131,831 – 49,964 3,221 63,423 151,569 5 45,966 445,979 7,642 453,621
Revenue from futures market 1,574 1,761 121 (209) 591 (1,841) 890 92 2,979 – 2,979
Revenue between segments 39,391 – 34,831 3,219 – 59,869 – – 137,310 (137,310) –
Revenue 2,949,269 1,087,963 515,971 815,557 1,865,276 277,519 439,639 636,732 8,587,926 640,713 9,228,639
Costofsales ofown copper (1,975,597) (853,922) (411,016) (662,416) (1,082,352) (41,435) (897,233) (576,737) (6,000,708) (1.498) (6,002,206)
Costof sales of copper third-party copper (1,506) – – – – (22,304) – – (23,810) (760,287) (784,097)
Costofsales of molybdenum (60,251) (3,352) (3,345) (17,236) (85,391) – – – (119,575) (24,231) (143,806)
Costofsales ofother products (110,314) – (50,566) (489) (40,402) (158,122) (418) (8,236) (368,547) (12,037) (880,584)
[Costof sales between segments (88,076) 9,496 (32,410) 3,475 19,392 (72,487) (1,126) 24,426 (137,310) 137,310 –
[Cost of sales (2,235,744) (847,778) (497,337) (676,666) (1,138,753) (294,348) (398,777) (560,547) (6,649,950) (660,743) (7,310,693)
[Gross profit 713,525 240,185 18,634 138,891 726,523 (16,829) 40,862 76,185 1,937,976 (20,030) 1,917,946
Other income, by funcion 15,415 3,498 4,017 11,215 8,100 5,093 985 911 49,234 26,019 75,253
Impairmentloss determined in accordance with
IFRSO – – – – – – – – – (934) (934)
Distribution costs (2,356) (12) (259) (109) (429) (892) – (740) (4,797) (2,198) (6.995)
Administrative expenses (83,085) (17,351) (10,590) (15,804) (46,902) (5,061) (14,846) (14,487) (158,126) (104,290) (262,416)
Ohher expenses, by funcion (119,120) (5,130) (16,114) (19,030) (42,296) (6,053) (8,202) (6,266) (222,211) (51,337) (273,548)
Law No. 13.196 (231,439) (95,972 (42,593) (76,209) (146,332) (17,131) (43,336) (43,285) (696,297) – (696,297)
Other gains (losses) – – – – – – – – – 18,264 18,264
Finance income (660) (25) 38 6 762 104 6 (286) (55) 35,467 35,412
Finance costs (181,667) (29,337) (14,304) (53,289) (165,302) (6,041) (110,389) (31,356) (491,685) (28,689) (520,374)
¡Share in the proft (loss) of associates and joint
Ventas accouned by he equiy method – – 382 529 937 – – – 1,848 7,865 9,713
Exchange diflerences 38,206 10,107 8,089 19,669 48,927 5,903 2,869 5,329 139,099 (2,152) 136,947
Income (loss) before taxes 198,819 105,963 (52,700) 5,869 383,988 (40,907) (32,051) (13,995) 554,986 (122,015) 432,971
Income tax expenses (147,613) (73,741) 35,910 (4,923) (269,961) 28,352 21,973 EX (401,586) 40,538 (361,048)
Income (loss) 51,206 32,222 (16,790) 946 114,027 (12,555) (10,078) (5,578) 153,400 (81,477) 71,923

89
CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

From 1/1/2019
9/30/2019
Chuquicamata R. Tomic Salvador Andina El Teniente Ventanas G. Mistral M. Hales Total Segments| Head Office Total
Segments Consolidated
ThUs$ ThUS$ ThUS$ ThUuS$ Thus$ ThuS$ ThUS$ ThUS$ ThUS$ ThUs$ ThUS$

Revenue from sales ofown copper 2,396,592 1,185,920 161,600 675,587 1,667,944 47,171 469,570 654,302 7,259,286 2 7,259,288
Revenue from sales ofthird-party copper 1,004 – – – 14,552 – 15,556 708,024 723,580
Revenue from sales of molybdenum 225,382 4,986 16,108 56,475 147,733 – – – 450,684 6,243 456,927
Revenue from sales ofother products 92,499 – 18,155 1,219 82,810 141,487 3,520 15,553 355,243 4,114 359,357
Revenue from futures market 5,792 2,947 366 (62) (92) (687) 677 91 9,032 – 9,032
Revenue between segments 11,078 – 7,324 1,904 1,330 78,032 – – 99,668 (99,668) –
Revenue 2,732,347 1,193,853 203,553 735,123 1,899,725 281,155 473,767 669,946 8,189,469 618,715 8,808,184
Costofsales ofown copper (2,115,967) (877,709) (188,496) (708,175) (1,097,380) (42,124) (509,108) (535,749) (6,074,708) 1,271 (6,073,437)
Costofsales of copper third-party copper (1,060) – – – – (114,908) – – (15,968) (701,204) (717,172)
Costofsales of molybdenum (62,182) (10,805) (6,672) (19,580) (34,492) – – – (133,731) (18,898) (152,629)
Costofsales of other products (91,025) – (9,888) (468) (50,877) (147,252) (3,393) (6,597) (309,500) (3,545) (313, 045)
Costof sales beween segments (35,884) 18,179 (12,128) (869) 3,926 (73,313) (1,315) 1,736 (99,668) 99,668
Cost of sales (2,306,118) (870,335) (217,184) (729,092) (1,178,823) (277,597) (513,816) (540,610) (6,633,575) (622,708) 0250253)
Gross profit 426,229 323,518 (13,631) 6,031 720,902 3,558 (40,049) 129,336 1,555,894 (3,993) 1,551,901
Other income, by function 11,105 3,926 9,389 18,763 9,482 981 1,539 2,370 57,555 149,426 206,981
Impairmentloss determined in accordance with
IFRS 9 – – – – – – 1,176 1,176
Distribution costs (4,898) (211) (597) (73) (725) (718) (90) (954) (8,266) (4,381) (12,647)
Administraive expenses (35,792) (22,413) (10,138) (12,247) (39,103) (6,019) (20,703) (19,676) (166,091) (136,934) (303,025)
Other expenses, by funcion (372,751) (12,236) (75,467) (10,617) (80,909) (2,371) (10,026) (13,075) (577,452) (63,966) (641,418)
Law No. 13.196 (232, 22) (107, 473 (14, 235) (68,814) (159, 083) (115,392) (53,335) (35,454) (686, 715) – (686,715)
Other gains (losses) – – – – 17,038 17,038
Finance income (1237 (81) 45 159 841 171 17 (366) (ast) 22,955 22,504
Finance costs (44,985) (36,861) (11,698) (47,975) (129,654) (7,723) (11,794) (36,266) (326,956) (33,148) (360,104)
Share in the profit (loss) of associates and joint
ventures aceounted by the equiy melhod 212 – (371) (728) (1,577) – (2,464) 14,327 11,863
Exchange difierences 38,142 5,980 2,700 12,818 41,195 3,890 4,707 8,588 118,020 (3,074) 114,946
Income (loss) before taxes (216,904) 154,149 (114,003) (102,683) 361,369 (23,623) (129,734) 34,503 (36,926) (40,574) (77,500)
Income tax expenses 137,721 (109,876) 78,495 69,230 (265,032) 16,200 91,082 (25,462) (7,641) (12,858) (20,499)
Income (loss) (79,183) 44,273 (35,508) (33,453) 96,337 (7,423) (38,652) 9,041 (44,567) (53,432) (97,999)

90
CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

As of September 30, 2020 and 2019, no impairment or reversal of impairment has been recorded in the
segments indicated in the previous table.

The assets and liabilities related to each operating segment, including the Corporation’s head office as of

September 30, 2020 and December 31, 2019, are detailed in the following tables:

9/30/2020
Category Chuquicamata poo Salvador Andina | El Teniente | Ventanas | G. Mistral | M. Hales Head Office Cd
ThUS$ Thus$ ThUS$ ThuS$ Thus$ | Thus$ | Thuss | Thuss Thus$ ThuS$
Currentassets 1,240,166] 528,176] 603,496] 293,822] 831544 67,667| 223,802| 366,973 3,982,947 8,138,783
Non-currentassets 9,133,917| 2,038,092| 1/057,324| 4,876,485] 7,702,617| 252/644| 1,092,927| 3,167,475 4,946,205 34,267,686
Currentliabilites 523,012) 170301) 173,351] 182243] 361,108] 64,137 82,667| 149,232 1,511,742 3,217,793
Non-currentliabilites 692,244) 262544) 237,116] 574442) 1213495] 124,748] 147671] 125353] 24,134,241 27,511,854
12/31/2019
Category Chuquicamata poo Salvador Andina | El Teniente | Ventanas | G. Mistral | M. Hales Head Office Cd
ThUS$ Thus$ ThUS$ ThUS$ Thus$ | Thus$ | Thuss | Thuss Thus$ ThuS$
Currentassets 1318408] 673.058] 409,962] 269,730] 959041] 63,802] 264,389] 342614 1,748,927 6,050,021
Non-currentassets 9,079,665] 2,097,006| 1,022,033| 4,828,805] 7,521,778] 268,457| 1,149,763] 3,247,562 5,079,521 34,294,590
Currentliabilites 821,067] 179,649] 140456] 214,350] 474,126] 76222] 103,484 130,946 1,773,657 3,922,957
Non-currentliabilites 765,850] 262720) 255063) 588841] 1,257,577) 138455] 152528) 115909] 21,250,035 24,786,987
The revenue segregated per geographical areas is the following:
1/11/2020 1/11/2019 7/1/2020 7/1/2019
Revenue per geographical areas 9/30/2020 9/30/2019 9/30/2020 9/30/2019
ThUS$ ThUS$ ThUS$ ThUS$
Total revenue from domestic customers 1,217,510 1,048,456 619,741 290,863
Total revenue from foreign customers 8,011,129 7,759,728 3,370,041 2,600,572
Total 9,228,639 8,808,184 3,989,782 2,891,435
1/11/2020 1/11/2019 7/1/2020 7/1/2019
Revenue per geographical areas 9/30/2020 9/30/2019 9/30/2020 9/30/2019
ThUS$ ThUS$ ThUS$ ThUS$
China 2,279,394 1,596,852 978,672 692,515
Restof Asia 1,035,909 1,187,325 395,312 338,644
Europe 3,100,855 2,763,921 1,296,624 798,165
America 2,372,247 2,705,086 1,108,871 921,772
Other 440,234 555,000 210,303 140,339
Total 9,228,639 8,808,184 3,989,782 2,891,435

During the periods January – September 2020 and 2019, there is no income from ordinary activities from
transactions with a single client, representing 10 percent or more of the income of ordinary activities of the

Corporation.

91

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

24.

25.

Foreign exchange differences

The detail of foreign exchange differences for the nine-month and three-month periods ended September
30, 2020 and 2019, is as follows:

Gain (loss) from foreign exchange differences 1/1/2020 1/1/2019 7/4/2020 7/4/2019
recognizad in Income 9/30/2020 9/30/2019 9/30/2020 9/30/2019
ThUS$ ThUS$ ThUS$ ThUS$
Gain from foreign exchange differences 237,945 158,392 (126,069) 123,003
Loss from foreign exchange differences (100,998) (43,446) (249) 52,125
Total exchange difference, net 136,947 114,946 (126,318) 175,128

Statement of cash flows

The following table shows the items that comprise other collections and payments from operating activities
in the Statement of Cash Flows:

1/1/2020 1/1/2019
Other collections from operating activities 9/30/2020 9/30/2019

ThUS$ ThUs$
VAT Refund 951,395 1,229,424
Other 491,832 207,512
Total 1,443,227 1,436,936

1/1/2020 1/1/2019

Other payments from operating activities 9/30/2020 9/30/2019
ThUS$ ThUS$
Contribution to Chilean treasury Law N*13.196 (693,931) –
Sales hedge (1,762) (10,360)
VAT and other similar taxes paid (985,275) (966,395)
Total (1,680,968) (976,755)

During the period January – September 2020, no capital contributions were received.

During the nine-month periods ended September 30, 2019, as indicated in the equity note, capital
contributions were received for a total of ThUS$400,000, which are presented in other cash inflows
(outflows) corresponding to the net cash flows provided by (used in) activities of financing.

92
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

26.

Financial risk management, objectives and policies

Codelco has committees within its organization to set out strategies allowing to reduce the financial risks to
which it may be exposed.

The risks to which Codelco is exposed and a brief description of the management procedures that are
carried out in each case, are described below:

a. Financial risks

Exchange rate risk:

According to IFRS 7, exchange rate risk is understood to be the risk that arises from financial
instruments that are denominated in foreign currencies, that is, a currency other than the
Corporation’s functional currency (US dollar).

Codelco’s activities that generate this exposure correspond to funding in UF, accounts payable and
receivable in Chilean pesos, other foreign currencies used in its business operations and obligations
with employees.

The majority of transactions in currencies other than US$ are denominated in Chilean pesos. Also,
there is another portion in Euro, which corresponds mainly to a long-term loan issued through the
international market, which exchange rate risk is mitigated with hedging instruments (Swap).

Taking into consideration the financial assets and liabilities as of September 30, 2020 as the base, a
fluctuation (positive or negative) of 10 Chilean pesos against the U.S. dollar (keeping the other
variables constant), could affect profits before taxes by US$34 million in net income, respectively.
This result is obtained by identifying the main items (including assets and financial liabilities)
denominated in foreign currencies in order to measure the impact on profit or loss that a variation
of +/- 10 Chilean pesos would have in terms of US$, with respect to the closing exchange rate at the
end of the reporting period.

Interest rate risk:

This risk arises from interest rate fluctuations in Codelco’s investment and financing activities. This
movement can affect future cash flows or the market value of fixed rate financial instruments.

These rate variations refer to U.S. dollar variations, mostly with respect to the LIBOR rate. To manage
this risk, Codelco maintains an adequate combination of fixed and variable rate debt, which is
complemented by the possibility of using interest-rate derivatives to meet the strategic guidelines
defined by Codelco’s Corporate Finance Department.

It is estimated that, on the basis of net debt balance as of September 30, 2020, a 1% change in
interest rates on the financial liabilities subject to variable interest rates would mean approximately a

93
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

US$17 million change in finance costs, before tax. This estimation is made by identifying the liabilities
assigned variable interest, accrued at the end of the financial statements, which may vary with a

change of one percentage point in variable interest rates.

Total fixed and variable interest rate obligations maintained by Codelco as of September 30, 2020

correspond to amounts of ThUS$17,632,799 and ThUS$1,935,862, respectively.

b. Market risks

Commodity price risk:

As a result of its commercial operations and activities, the Corporation’s income is mainly exposed
to the volatility of copper prices and certain sub-products such as gold and silver.

Copper and molybdenum concentrate sale agreements and copper cathode sale agreements
generally provide for provisional pricing of sales at the time of shipment, with final pricing based
on the monthly average market price for specified future periods. At the reporting date, the
provisionally priced metal sales are marked-to-market, with adjustments (both gains and losses)
being recorded in revenues in the consolidated statement of comprehensive income. Forward
prices at the period-end are used for copper sales, while period-end average prices are used for
molybdenum concentrate sales due to the absence of an assets futures market. (See Note 2.r)
“Income from Activities Ordinary Procedures from Contracts with Customers “of section II” Main
policies countable ”).

For the nine-month period ended September 30, 2020, if the future price of copper fluctuates by
+ / – 5% (with the other variables constant), the result would be US$157 million before taxes as a
result of setting the mark to market of sales revenue to provisional prices in effect as of September
30, 2020 (MTMF 213). For the estimate indicated, all ofthose physical sales contracts were valued
according to the monthly average immediately following the close of the financial statements, and
proceeds to be estimated regarding what the final settlement price would be if there is a difference
of + / – 5% with respect to the future price known to date for this period.

In order to protect cash flow and adjust, where necessary, its sales contracts to its trade policy,
the Corporation holds operations in futures markets. At the end of the reporting period, these
contracts are adjusted to fair value, recording this effect, at the settlement date of the hedging
transactions as part of net product sales.

The Corporation has not entered into any hedging transactions with the specific purpose of
hedging the price risk caused by fluctuations in prices of production inputs.

94
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

C.

Liquidity risk

The Corporation ensures that it has sufficient resources, such as pre-approved credit lines (including
refinancing), in order to meet short-term requirements, after considering the necessary working capital
for its operations and any other commitments it has.

In this sense, the Corporation maintains resources at its disposal sufficient to meet its obligations,
whether in cash, liquid financial instruments or credit facilities.

In addition, the Finance Department constantly monitors the Corporation’s cash flow projections based
on short and long term projections and available financing alternatives. In addition, the Corporation
estimates that it has enough headroom to increase the level of borrowing for the normal requirements
of its operations and investments established in its development plan.

In this context, according to current existing commitments with creditors, the cash requirements to
cover financial liabilities classified by maturity and presented in the statement of financial position are
detailed as follows:

s . a abans Less than Between one More than
Maturity of financial liabilities as of
9/30/2020 one year and five years five years
ThUS$ ThUS$ ThUS$

Loans from financial institutions 390,953 832,223 1,292,360
Bonds 550,405 3,119,083 13,383,638
Derivatives 7,329 – 179,828
Other financial liabilites – 54,177 –
Total 948,687 4,005,483 14,855,826

Credit risk

This risk comprises the possibility that a third party does not fulfill its contractual obligations, thereby
causing a loss for the Corporation.

Given the Corporation’s sales policy, principally with cash and advance payments and bank letters of
credit, the uncollectability of client debt balances is minimal. This is complemented by the familiarity
the Corporation has with its clients and the length of time it has operated with them. Therefore, the
credit risk of these transactions is not significant.

The indications with respect to the payment conditions to the Corporation are detailed in every sales
contract and the negotiation management is under the charge of the Vice Presidency of Marketing.

In general, the Corporation’s other accounts receivable have a high credit quality according to the
Corporation’s evaluations, based on each debtor’s solvency analysis and payment history.

95
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The maximum exposure to credit risk as of September 30, 2020 ¡is represented by the financial asset
items presented in the Corporation’s Statement of Financial Position.

The Corporation’s accounts receivable do not include customers with balances that could be classified
as a significant concentration of debt and would represent a material exposure for Codelco. This
exposure is distributed among a large number of clients and other counterparties.

In the customer items, the provisions, which are not significant, are included based on the review of
the outstanding balances and characteristics of the clients, destined to cover eventual insolvencies.

In explanatory note 2, trade and other receivables presents past due balances that have not been
impaired.

The Corporation estimates that unimpaired amounts overdue over 30 days are recoverable based on
clients’ historical payment behavior and their existing credit ratings.

As of September 30, 2020 and 2019, there are no receivable balances that have been renegotiated.
Codelco works with major banks, which have high national and international ratings, and continually
assesses them; therefore, the risk that could affect the availability of the Corporation’s funds and
financial instruments is not significant.

Also, in some cases, to minimize credit risk, the Corporation has contracted credit insurance policies
through which it transfers to third parties the commercial risk associated with some aspects of its
business.

During the nine-month periods ended September 30, 2020 and 2019, no guarantees have been
executed to ensure the collection of third party debt.

Personnel loans mainly relate to mortgage loans, according to programs included in union agreements,
which are paid for through payroll discounts.

27. Derivatives contracts

The Corporation has entered into transactions to hedge cash flows, to minimize the risk of foreign exchange
rate variations and sales price variations, detailed as follows:

a. Hedges

The Corporation maintains an exposure associated with its hedging operations against exchange rate
and interest rate variations, whose positive fair value, net of taxes, amounts to ThUS$596.

96
CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The following table summarizes the detail of the financial hedges contracted by the Corporation:
September 30, 2020

Financial

Type of c d bligation: Fair value of
Hedged item Bank derivative | Maturity | Currency vere o ‘gatlon: hedging Asset Amortized cost
item hedging s
contract , instruments
instrument
ThUuss ThUS$ ThUus$ ThUs$ ThUS$
Bond UF Mat 2025 Credit Suisse (USA) Swap 4/1/2025 US$ 251,328 208,519 61,342 327,400 (266,058)
Bond EUR Mat 2024 [Santander (Chile) Swap 7/9/2024 US$ 351,369 409,650 (74,342) 392,192 (466,534)
Bond EUR Mat 2024 [BNP Paribas (USA) Swap 7/9/2024 US$ 351,369 409,680 (74,028) 392,192 (466,220)
Bond UF Mat 2026 Santander (Chile) Swap 8/24/2026 US$ 364,244 406,212 (20,908) 459,720 (480,628)
Bond AUD Mat 2039 [Santander (Chile) Swap 8/22/2039 US$ 50,154 49,266 (1,701) 69,879 (71,580)
Bond HKD Mat 2034 _ |HSBC Bank USA N.A. (USA) Swap 11/7/2034 US$ 64,515 63,792 (2,799) 83,253 (86,052)
Total 1,432,979 1,547,119 (112,436) 1,724,636 (1,837,072)
December 31, 2019
Financial a
Type of Cc a bligation: Fair value of
Hedged item Bank derivative | Maturity | Currency overe o !gatlon: hedging Asset Amortized cost
item hedging ,
contract , instruments
instrument
ThUus$ ThUS$ ThUs$ ThUS$ ThUS$
Bond UF Mat 2025 Credit Suisse (USA) Swap 4/1/2025 US$ 260,890 208,519 75,608 329,480 (253,872)
Bond EUR Mat 2024 [Santander (Chile) Swap 7/9/2024 US$ 336,399 409,650 (73,114) 380,570 (453,684)
Bond EUR Mat 2024 [Deustche Bank (England) Swap 7/9/2024 US$ 336,399 409,680 (72,756) 380,583 (453,339)
Bond UF Mat 2026 Santander (Chile) Swap 8/24/2026 US$ 378,101 406,212 6,976 461,581 (454,605)
Bond AUD Mat 2039 — [Santander (Chile) Swap 8/22/2039 US$ 49,013 49,266 (1,558) 54,509 (56,067)
Bond HKD Mat 2034 _ |HSBC Bank USA N.A. (USA) Swap 11/7/2034 US$ 64,220 63,792 (703) 64,220 (64,923)
Total 1,425,022 1,547,119 (65,547) 1,670,943 (1,736,490)

As of September 30, 2020, the Corporation no maintains cash deposit guarantee balances.

The current methodology for valuing currency swaps is to use the bootstrapping technique from the
mid – swap rate to construct the curves (zero) in UF and US$ respectively, from market information.

The notional amounts are detailed below:

Notional amount of contracts with final maturity
September 30, 2020 | Currency Less than 90 | More than 90 Current Total | 1to 3 years | 3to 5 years More than 5 | Non-current
days days years Total
ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$
Currency derivatives ThUS$ 2,091 59,215 61,306 116,564 1,119,326 579,155 1,815,045

. Cash flows hedging contracts and commercial policy adjustment

The Corporation enters into metals hedging activities. Such results increase or decrease the total sales
revenue based on the market prices of the metals. As of September 30, 2020, these operations
generated a gain of ThUS$863.

97
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

b.1. Commercial flexibility operations of copper contracts

The purpose of these contracts is to adjust the price of shipments to the price defined in the
Corporation’s related policy, defined in accordance with the London Metal Exchange (LME). As of
September 30, 2020, the Corporation performed derivative market transactions of copper that
represent 455,650 metric tons of fine copper. These hedging operations are performed as part of

the Corporation’s commercial policy.

The current contracts as of September 30, 2020, present a negative fair value of ThUS$8,035 and
their final result will only be known at their maturity, offsetting the hedging transactions with revenue

from the sale of the hedged products.

The transactions settled as of nine-month period ended September 30, 2020 resulted in a net
positive effect on net income of ThUS$2,536, which is comprised of the amounts received for sales
contracts for ThUS$4,652 and the amounts net off against purchases contracts for ThUS$2,116.

b.2. Commercial Transactions of Current Gold and Silver Contracts

As of September 30, 2020, the Corporation maintains derivative contracts for the sale of gold of

ThOZ 10,192.

The contracts in force as of September 30, 2020, present a positive fair value of ThUS$224, the
final result of which can only be known at the expiration of these operations, after the compensation
between the hedging operations and the income from the sale of the protected products. These

hedging operations expire until January 2021.

The operations completed between January 1 and September 30, 2020, generated a negative effect

on results of ThUS$1,673, corresponding to values per physical sales contracts.

b.3. Cash flow hedging operations backed by future production

The Corporation does not hold cash flow hedges backed by future production as of September 30,

2020.

The following tables set forth the maturities of metal hedging activities, as referred to in point b

above:
September 30, 2020 Maturity date

ThUS$ 2020 2021 2022 2023 2024 Upcoming Total

Flex Com Cobre (Asset) 666 1,519 – – – 2,185|
Flex Com Cobre (Liability) (1,662) (5,099) (3,294) (165) (10,220)
Flex Com Gold/Silver 241 (17) – – 224
Price setting – – – – –
Metal options – – – – –
Total (755) (8,597) (3,294) (165) (7,811)

98

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Gold/Silver Futures [ThOZ] 2.720
Copper price seting [MT] –
Copper Options [MT]

December 31, 2019 Maturity date

ThUuSs$ 2020 2021 2022 2023 2024 Upcoming Total
Flex Com Cobre (Asset) 1,315 525 – – – – 1,840
Flex Com Cobre (Liabiliy) (1,799) (844) (12) (2,655)
Flex Com Gold/Silver (1) – – (1)
Price setting – –
Metal options – – – –
Total (485) (319) (12) (816)
September 30, 2020 Maturity date
All figures in thousands of metric tons ounces 2020 2021 2022 2023 2024 Upcoming Total
Copper Futures [MT] 64.725 302.625 84.650 3.650 – – 455.650
Gold/Silver Futures [ThOZ] 7.330 2.860 – 10.190
Copper price seting [MT] – – –
Copper Options [MT]
December 31, 2019 Maturity date
All figures in thousands of metric tons ounces 2020 2021 2022 2023 2024 Upcoming Total
Copper Futures [MT] 335.650 96.650 0.500 – – – 432.800

2.720

28. Contingencies and restrictions
a) Litigations and contingencies

There are various lawsuits and legal actions initiated by or against the Corporation, which derive from ¡ts
operations and the industry in which it operates. In general, these are civil, tax, labor and mining
litigations, all related to the Corporation’s activities.

In the opinion of Management and ¡ts legal advisors, the lawsuits where the Corporation is being sued
and could have negative results do not represent significant loss contingencies or cash flows. Codelco
defends its rights and employs all corresponding relevant legal instances, resources and procedures.
The most significant lawsuits that involve Codelco are related to the following matters:

– Tax proceedings: There is a tax proceeding for liquidation No.141 of tax year 2015 and
Exempt Resolution No. 89 of 2016 issued by the Internal Revenue Service (SII), for which the
Corporation presented the corresponding appeals, which were received and resolved in favor of the
Tax and Customs Courts, a resolution that was appealed by the SII.

– Labor proceedings: Labor proceedings brought by the workers of the Andina Division against the
Corporation with regard to occupational diseases (silicosis).

– Mining proceedings and others arising from the Operation: The Corporation has been participating,
and will probably continue to participate, as plaintiff and defendant in given court proceedings
involving its mining operation and activities, through which ¡it seeks to exercise certain actions or set
up certain defenses in relation to given mining concessions that have been established or are in the
process of being established, as well as also with regard to its other activities. These proceedings

99

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

currently do not involve any given amount and do not have any essential effect on Codelco’s
development.

– At the date of issuance of these financial statements, the Codelco faces various lawsuits and legal

actions against it for a total of approximately US$310 million corresponding to 400 cases. According
to the estimate made by the legal advisors of the Corporation, 314 cases, which represent 78.50% of
the universe, have associated probable loss results amounting to TRUS$57,167. There are also 58
cases, representing 14.50% for an amount of ThUS$34,265, for which it is more likely than not, that
the ruling will not be against the Corporation. For the remaining 28 cases, representing 7% for an
amount of ThUS$715, the Corporation’s legal advisors consider an unfavorable result remote.

Lawsuit under administrative law: On August 2, 2017, a Nullity in Public Law claim was filed in the
25th Civil Court of Santiago against Audit Report No. 900 of 2016, issued by the General
Comptrollership of the Republic on May 10, 2017.

Once the discussion and evidence stage concluded, the Santiago Civil Court, on September 11, 2020,
delivered ¡ts judgment in which it dismissed the annulment action filed by the Corporation,
condemning it to the respective costs of said lawsuit. The Corporation announces that it will appeal
said judgment.

For litigation with a probable unfavorable outcome for the Corporation, the necessary provisions have
been recognized as “provisions for legal proceedings.”

b) Other Commitments

On May 31, 2005, Codelco, through its subsidiary Codelco International Ltd. signed an agreement
with Minmetals to form a company, CuPIC, in which both companies have an equal equity interest.
A 15-year copper cathode sales contract to that associated company was agreed upon, as well as
a purchase contract from Minmetals to CupiC for the same period and for equal monthly shipments
to complete a total of 836,250 metric tons. Each shipment shall be paid for by the buyer at a price
formed by a fixed re-adjustable component plus a variable component, which depends on current
copper prices at the time of shipment.

During the first quarter of 2006 and on the basis of the negotiated financial terms, financing contracts
were formalized with the China Development Bank allowing CuPIC to make the US$550 million
advance payment to Codelco in March 2006.

With regard to financial obligations incurred by the associate CuPIC with the China Development
Bank, Codelco Chile and Codelco International Ltd, must meet certain commitments, mainly relating
to the delivery of financial information. In addition, Codelco Chile must maintain 51% ownership of
Codelco International Limited.

According to the Sponsor Agreement, dated March 8, 2006, the Codelco International Ltd.
subsidiary gave its participation in CuPIC as a guarantee to the China Development Bank.

100
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Subsequently, on March 14, 2012, CUuPIC paid off its debt to the abovementioned bank. As of
December 31, 2017. Codelco does not hold any indirect guarantee regarding ¡ts participation in this
associated company.

On December 17, 2015, the Company’s management presented a restructuring for the Supply
Contract, which implies the removal of its share in CUPIC.

On April 7, 2016, the Corporation formalized the removal of its share in CUPIC, of which Codelco
retained 50% ownership through the subsidiary Codelco International. Until that date, Codelco
shared the ownership of the Company in the same proportion with the company Album Enterprises
Limited (a subsidiary of Minmetals).

In order to realize the above mentioned term of the shareholding, Codelco signed a set of
agreements which formalized primarily the following issues:

+ Copper sales contract modifications from Codelco to CUPIC signed in 2006, which establishes
the reduction of half of the outstanding tonnage to deliver to this company and in which Codelco
pays to CUPIC the amount of ThUS$99,330.

+ Reduction of share capital in CuPIC, equivalent to the 50% of the Codelco International shares
in said company and by which CuPIC repays to Codelco the amount of ThUS$99,330.

+ Waiver of Codelco to any dividends associated with the profits generated by CuPIC from January
1, 2016 and the date of signing the agreement.

+ —Additionally, the cessation of dividends reception as a consequence of the removal of the
Codelco share in the ownership of CuPIC since 2016, led to a reduction of the net profit
estimated by Codelco until the end of the contract signed with that company (May 2021).

Regarding the financing agreement signed on August 23, 2012, between the subsidiary, Gacrux
Inversiones SpA and Mitsui 8, Co. Ltd. for the acquisition of the 24.5% stake in Anglo American Sur
S.A. which was subsequently amended on October 31, 2012, a pledge is included over the shares
that the subsidiary has on Acrux Inversiones SpA (shared participation with Mitsui and minority
shareholder in Anglo American Sur S.A.), in order to ensure compliance with the obligations that
the financial agreement contemplates.

This pledge extends to the right to collect and receive from Acrux dividends which have been agreed
in the corresponding meetings of shareholders of the company and any other distributions paid or
payable to Gacrux respect of the pledged shares.

On December 22, 2017 according to archive No. 12326 / 2017, itwas established that, Gacrux,
the Creditor and the Guarantee Agent, the latter representing the Guaranteed Parties, modified , by
virtue of the Merger (see Note 2d), the Contract of Pledge and the Modified Pledge Agreement as
to the pledge on transferable securities and the commercial pledge, as well as the restrictions and

101
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

vi.

prohibitions established in the Pledge Contract and in the Modified Pledge Contract, making it
subject to , by virtue of the Merger, two thousand thirteen million two hundred and forty-five
thousand four hundred and seventy-three shares pledge issued by Becrux, owned by Gacrux,
hereinafter the “Pledged Becrux Shares.”

Law 19.993 dated December 17, 2004, authorized the purchase of the Refinery and Smelter Las
Ventanas assets from ENAMI, establishing that the Corporation must ensure that the smelting and
refining capacity required is maintained, without any restriction and limitation, for treating the
products of the small and medium mining sector sent by ENAMI, under the form of toll production
or another form agreed upon by the parties.

Obligations with the public for bond issues means that the Corporation must meet certain restrictions
related to limits on pledges and leaseback transactions on its principal assets and on its ownership
interest in subsidiaries.

The Corporation has complied with these conditions as of September 30, 2020 and 2019.

On January 20, 2010, the Corporation signed two energy supply contracts with Colbún S.A., which
includes energy and power sales and purchases for a total of 510 MW of power. The contract
provides a discount for that unconsumed energy from Codelco’s SIC divisions with respect to the
amount of contracted power. The discount is equivalent to the value of the sale of that energy on
the spot market.

The contracted power for supplying these Divisions is comprised by two contracts:

– Contract No.1 for 176 MW, current until December 2029

– Contract No.2 for 334 MW, current until December 2044. This contract is based on energy
production from Colbún’s Santa María thermal power station, which is currently in operation.
This plant is coal-fired, and therefore the electric energy tariff rate applied for the energy supplied
to Codelco is linked to the price of coal.

Both of these contracts comply with Codelco’s long-term energy and power requirements from the
SIC of approximately 510 MW.

Through these contracts, which operate through take or pay, the Corporation agrees to pay for the
contracted energy and Colbún undertakes to reimburse at market price the energy not consumed
by Codelco.

These contracts have maturity dates in 2029 and 2044.

On November 6, 2009, Codelco signed the following long-term electric energy supply contracts with

ELECTROANDINA S.A. (associate until January 2011), which matured in August 2017.
For the electric power supply of the Chuquicamata’s work center, there are three contracts:

102
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

vil.

viii.

– — Engie for a 15-year term from January 2010, that is maturing in December 2024, for 200
MW capacity, and another contract for a 200 MW capacity which was signed in January
2018 and will be effective as of January 2025 with maturity in December 2035.

– CTA effective from 2012 for 80 MW capacity, maturity in 2032.

On August 26, 2011, Codelco signed two energy supply contracts with AESGener. The first one for
the Minister Hales division for a 99 MW capacity and the second contract for the Radomiro Tomic
work center, for a maximum capacity of 145 MW. Both contracts will mature in 2028.

On November 11, 2011, Law No. 20551 was published in the Official Journal, which regulates the
tasks and closure of mining facilities. Additionally, on November 22, 2012, the Supreme Decree No.
41 of the Minister of Mining, which approves the Regulations of this Law, was published in the Diario
Oficial.

This law requires the Corporation, among other requirements, to provide financial guarantees to the
State to ensure the implementation of closure plans. It also establishes the obligation to make
contributions to a fund which aims to cover the costs of post-closure activities.

The Corporation, in accordance with the mentioned regulation, provided to SERNAGEOMIN the
Mine Closure Plan (ARO) for all of the Codelco operating divisions in 2014, which were approved
in 2015 in accordance with the provisions of the Act.

The mine closure plans delivered to SERNAGEOMIN were developed by invoking the transitional
regime of the Act, which was specified for the affected mining companies under the general
application procedure (extraction capacity > 10,000 tons per month), and which, at the date of
enactment of the Law, will abide in operation and move forward with a mine closure plan previously
approved under Mine Safety Regulations Supreme Decree No. 132.

The Corporation considers that the accounting liability recorded caused by this obligation differs
from the law’s requirement, mainly by differences concerning the horizon that is considered for the
projection of flows, in which the law requires the determination of the obligations in terms of mineral
reserves, while the financial-accounting approach incorporates some of ¡ts mineral resources.
Therefore, the discount rate established by law, may differ from that used by the Corporation under
the criteria set out in lAS 37 “Provisions, Contingent Liabilities and Contingent Assets” and
described in Note 2, letter p) of Main Accounting Policies.

As of September 30, 2020, the Corporation has agreed guarantees for an annual amount of U.F.

29,188,594 to comply with the aforementioned Law No. 20551. The following table details the main
given guarantees:

103
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Transmitter Mine site Amount Currency Date Maturity date ISORA ThUS$
Banco Estado [Radomiro Tomic 3,232,980] UF 11/8/2019 | 11/10/2020 0.09 117,759
Banco ltau Ministro Hales 1,845,954| — UF 11/6/2019 | 11/13/2020 0.09 67,238
Banco de Chile [Chuquicamata 4,191,593 | UF 11/26/2019 | 11/26/2020 0.10 152,676
Banco Santander [Teniente 5,000,000 | UF 11/29/2019 | 12/2/2020 0.15 182,122
Banco Bci Teniente 2,367,016| UF 11/28/2019 | 12/2/2020 0.18 86,217
Banco ltau Teniente 1,800,000] UF 11/29/2019 | 12/2/2020 0.15 65,564
Banco Estado [Gabriela Mistral 1,978,180] UF 12/11/2019 | 12/15/2020 0.11 72,054
Banco ltau Salvador 1,300,000] UF 2112/2020 | 2/18/2021 0.11 47,352
Banco Bci Salvador 2,643,667 | UF 2112/2020 | 2/18/2021 0.18 96,294
Banco Estado [Andina 3,310,724 | UF 4/28/2020 | 5/3/2021 0.35 120,591
Banco Bci Andina 663,655] UF 4/28/2020 | 5/3/2021 0.70 24,173
Banco Estado [Ventana 400,043] UF 12/19/2019 | 10/7/2020 0.10 14,571
Banco Bci Ventana 454,782 | UF 12/18/2019 | 10/7/2020 0.18 16,565
Total 29,188,594 1,063,176

ix. On August 24, 2012, Codelco through its subsidiary Inversiones Mineras Nueva Acrux SpA (Nueva
Acrux) (whose minority shareholder is Mitsui), signed a contract with Anglo American Sur S.A.
Under this contract, Codelco agreed to sell a portion of its annual copper production to the
mentioned subsidiary, who in turn agrees to purchase such production.

Such annual portion is determined by the share of Codelco’s indirect subsidiary, Inversiones
Mineras Becrux SpA (also shared ownership with Mitsui), maintained for the shares of Anglo
American Sur S.A.

In turn, the subsidiary Nueva Acrux agrees to sell to Mitsui, the products purchased under the
agreement described in the preceding paragraphs.

The contract expiration will occur when the shareholders agreement of Anglo American Sur S.A
ends or other events related to the completion of mining activities of the company take place.

On June 11, 2019, Codelco and Anglo American Sur S.A. signed an agreement that ensures and
optimizes the operation of their respective copper mines, Andina and Los Bronces, respectively.
This agreement is similar to others that the same parties have signed during the last 40 years and
that favor the independent, safe and sustainable operation of these neighboring mines.

Xx. On March 11, 2020, the World Health Organization characterized the outbreak of a strain of the new

coronavirus (“COVID-19”) as a pandemic that has resulted in a series of public health and
emergency measures that have been put in place and are underway to
combat the spread of the virus. The duration and impact of COVID-19 are unknown at this time and
itis not possible to reliably estimate the impact of the duration and severity of these developments
in future periods. Codelco is permanently monitoring the aforementioned outbreak, its constant
evolution, eventual impact on the Corporation’s financial and operational indicators. additional
possible effects on our workers, clients, suppliers, as well as continuing collaborating with the
government actions that are being taken to reduce its spread, with no material impact observed to

104

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Xi.

date on its ability to meet its financial, production or sale commitments. The foregoing is without
prejudice to the impact on world demand for copper, which has meant a decrease in the price, which
is public knowledge.

Due to the above, as of September 30, 2020 Codelco has taken a series of restrictive measures in
its operation and development of investment projects, in order to protect the health of its workers,
which are indicated below:

– March 25, 2020, the Corporation announced the temporary suspension of the projects: the
remaining works of the Chuquicamata Underground Mine Project, Early Works of Rajo Inca and
Assembly Works of Traspaso Andina. The suspension was carried out gradually as of March 25
for a period of 15 days.

– April 8, 2020, the Corporation announced the decision to partially or totally suspend some third-
party services both for projects and for operations support (which involves around 30% of the
total contractor workers), for a period of 30 days, extendable. With this decision, Codelco asked
the contracting companies to take steps with their respective unions to benefit from the benefits
of the Employment Protection Law No. 21227. The conditions in which the total or partial
suspension was implemented was agreed independently with each of the
contracting companies.

– — June 20, 2020, the Corporation announced the stoppage of construction of all its projects in the
Antofagasta Region and the operational continuity of the Chuquicamata Division only with
workers from Calama. With this measure, the construction of underground Chuquicamata and
other divisional projects were completely suspended.

– June 25, 2020, the Corporation announced the temporary halt of activities in the Chuquicamata
Division smelter and refinery managements, a measure that reduces the participation in work of
about 400 people, together with the detention of equipment and reduction of the productive
rhythms in both areas. The measure considered the continuity of minor operations and
preventive maintenance.

The aforementioned measures have not significantly affected Codelco Chile’s accounting results
for the January-September 2020 period, nor the value of its assets as of September 30, 2020

On July 21, 2020, the First Environmental Court admitted for processing a claim for environmental
damage filed by the State Defense Council against Codelco Salvador Division, for affecting the
Salar de Pedernales due to the extraction of the water resource carried out in said salt flat. The
Corporation is evaluating said demand and its potential impact on projects and operations.

105
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

29. Guarantees
The Corporation as a result of its activities has received and given guarantees.

The following tables list the main guarantees given to financial institutions and others:

Direct Guarantees provided to Financial Institutions and others
. 9/30/2020 12/31/2019
Creditor of the Guarantee Type of Guarantee Currency Maturity THUSS ThUS$

General Directorate of Maritime Territory and Merchant Marine Maritime concession CLP 3/1/2020 – 1,409
General Directorate of Maritime Territory and Merchant Marine Maritime concession CLP 6/30/2020 – 2
General Directorate of Maritime Territory and Merchant Marine Maritime concession CLP 7/15/2020 – 230
General Directorate of Maritime Territory and Merchant Marine Maritime concession CLP 3/1/2021 1,339 –
Viability management Building project UF 2/18/2020 – 1
Viability management Building project UF 3/1/2020 – 4
Viability management Building project UF 3/10/2020 – 8
Viability management Building project UF 4/22/2020 – 4
Viability management Building project UF 11/26/2020 12 –
Viability management Building project UF 11/30/2020 27 –
Viability management Building project UF 1/25/2021 1 –
Viability management Building project UF 4/3/2021 29 –
Viability management Building project UF 4/15/2021 20 –
Viability management Building project UF 4/29/2021 50 –
Viability management Building project UF 6/25/2021 4 –
Viability management Building project UF 7/2/2021 13
Viability management Building project UF 4/8/2024 4 4
Minera Doña Ines de Collahuasi Offer to purchase an asset US$ 1/2/2021 8 –
Ministry ofnational goods Project of exploitation CLP 2/28/2020 – 154
Ministry ofnational goods Project of exploitation CLP 2/25/2021 154 –
Ministry ofnational goods Project of exploitation UF 6/9/2021 21 24
Minestry of Public Works Building project UF 12/31/2019 – 22,364
Minestry of Public Works Building project UF 1/2/2021 21,544 –
Minestry of Public Works Building project UF 10/2/2021 498 516
Minestry of Public Works Building project UF 12/31/2021 160 –
Minestry of Public Works Building project UF 7/29/2022 37 –
Oriente Copper Netherlands B.V. Pledge on shares US$ 11/1/2032 877,813 877,813
Sernageomin Environmental UF 2/18/2020 – 125,213
Sernageomin Environmental UF 5/3/2020 – 125,179
Sernageomin Environmental UF 10/7/2020 31,136 32,321
Sernageomin Environmental UF 11/10/2020 117,759 122,239
Sernageomin Environmental UF 11/13/2020 67,238 69,796
Sernageomin Environmental UF 11/26/2020 152,676 158,485
Sernageomin Environmental UF 12/2/2020 333,903 346,606
Sernageomin Environmental UF 12/15/2020 72,054 74,795
Sernageomin Environmental UF 2/18/2021 143,646 –
Sernageomin Environmental UF 5/3/2021 144,764 –
Total general 1,964,910 1,957,167

As for the documents received as collateral, they cover mainly obligations of suppliers and contractors
related to the various development projects. Below are given the amounts received as collateral, grouped
according to the Operating Divisions that have received these amounts:

106
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Guarantees received from third parties
Division 9/30/2020 12/31/2019

ThUS$ ThUS$
Andina 317 418
Chuquicamata 290 375
Casa Matriz 737,866 887,051
Salvador – 387
El Teniente 427 447
Ventanas 50 52
Total 738,950 888,730

30. Balances in foreign currency

a) Assets by of Currency
9/30/2020
Assets national and Foreign currrency US Dollars Euros Other Non-indexed U.F. TOTAL
currencies ch$
Current Assets
Cash and cash equivalents 3,193,009 50,077 4,467 205,530 806 3,453,889
Other current financial assets 203,781 – 12 64 203,857
Other current non-financial assets 38,243 385 322 3,256 – 42,206
Trade and other current receivables 1,760,783 85,305 321 487,578 – 2,333,987
Accounts receivable from related parties, current 21,523 – – – – 21,523
Inventories 2,028,282 – – 2,028,282
Currenttax assets 54,027 – – 1,012 – 55,039
Total current assets 7,299,648 135,767 5,110 697,388 870 8,138,783
Non-current assets
Investments accounted for using equity method 3,470,552 – 3,470,552
Property, plantand equipment 29,390,808 – – 29,390,808
Deferred tax assets 41,626 – 4,531 – 46,157
Others assets 1,023,440 2,310 271,769 62,650 1,360,169
Total non-current assets 33,926,426 2,310 276,300 62,650 34,267,686
[Total Assets [41,226,074 135,767 7,420 973,688 63,520 42,406,469 ]

107
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

12/31/2019
Assets national and Foreign currrency US Dollars Euros Other Non-indexed U.F. TOTAL
currencies Ch$
Current Assets
Cash and cash equivalents 1,212,657 49,773 4,674 34,348 1,653 1,303,105
Other current financial assets 172,794 – – 19 138 172,951
Other current non-financial assets 20,762 – 3 196 8 20,969
Trade and other current receivables 2,006,046 112,649 384 450,304 18,885 2,588,268
Accounts receivable from related parties, current 20,874 – – – – 20,874
Inventories 1,921,135 – – – – 1,921,135
Currenttax assets 20,960 2 19 1,738 – 22,719
Total current assets 5,375,228 162,424 5,080 486,605 20,684 6,050,021
Non-current assets
Investments accounted for using equity method 3,483,523 – – – – 3,483,523
Property, plantand equipment 29,268,012 – – – – 29,268,012
Deferred tax assets 43,736 – – – – 43,736
Others assets 611,426 189 65,692 181,627 640,385 1,499,319
Total non-current assets 33,406,697 189 65,692 181,627 640,385 34,294,590
[Total Assets [38,781,925 162,613 70,772 668,232 661,069 40,344,611]
b) Liability by type of currency:
[ 9/30/2020
National and foreign currency liabilities US Dollars Euros Oher Non-indexed UF. TOTAL
currencies Ch$
Current liabilities
Other current financial liabilites 947,071 (2) 12 6,632 (5,026) 948,687
Currrentlease liabilites 44,756 – 405 64,198 16,877 126,236
Trade and other current payables 567,840 10,767 939 535,686 40 1,115,272
Accounts payable to related parties, current 138,461 – – 14,242 6,684 159,387
Other current provisions 498,389 58 – 7,853 – 506,300
Currenttax liabilites 13,213 883 71 (10,076) 48 4,139
Current provisions for employee benefits 1,614 – – 322,339 285 324,238
Other current non-financial liabilites 30,726 – 79 2,671 58 33,534
Total current liabilities 2,242,070 11,706 1,506 943,545 18,966 3,217,793
Non-current liabilities
Other non-current financial liabilites 18,593,783 (5,640) (1,085) 2 274,249 18,861,309
Non-current lease liabilities 83,467 – 75 137,405 48,210 269,157
Non-currentpayables 443 – – – – 443
Other non-current provisions 1,093,928 – – 66,143 924,217 2,084,288
Deferred tax liabiliies 5,136,558 – – 4,893 – 5,141,451
Non-current provisions for employee benefits 11,478 – – 1,141,062 – 1,152,540
Other non-current non-financial liabilites 1,477 – – 1,189 – 2,666
Total non-current liabilities 24,921,134 (5,640) (1,010) 1,350,694 1,246,676 27,511,854
[Total liabilities [27,163,204 6,066 496 2,294,239 1,265,642 | 30,729,647 ]

108
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

12/31/2019

National and foreign currency liabilities US Dollars Euros Oher Non-indexed UF. TOTAL

currencies Ch$
Current liabilities
Other current financial liabilites 1,244,765 (2) 5,721 370 (264) 1,250,590
Currrentlease liabilites 36,702 – 272 74,109 16,678 127,761
Trade and other current payables 886,390 12,439 1,300 520,470 316 1,420,915
Accounts payable to related parties, current 135,281 – 1,953 – 137,234
Other current provisions 356,871 64,664 8,167 61,545 10,925 502,172
Current tax liabiliies – – 13,857 – 13,857
Current provisions for employee benefits – 435,565 – 435,565
Other current non-financial liabilites 27,223 – 7,582 58 34,863
Total current liabilities 2,687,232 77,101 15,460 1,115,451 27,713 3,922,957
Non-current liabilities
Other non-current financial liabilites 15,462,011 (6,414) 112,112 3 665,401 16,233,113
Non-current lease liabilities 113,062 – 378 118,701 72,969 305,110
Non-currentpayables 8,346 – – – 8,346
Other non-current provisions 1,481,547 410 26,624 581,906 2,090,487
Deferred tax liabilittes 4,860,881 – – – 4,860,881
Non-current provisions for employee benefits 14,699 1,260,559 8,099 1,283,357
Other non-current non-financial liabilites 5,447 – – 246 – 5,693
Total non-current liabilities 21,945,993 (6,414) 112,900 1,406,133 1,328,375 24,786,987
[Total liabilities 24,633,225 70,687 128,360 2,521,584 1,356,088 [ 28,709,944 ]

31. Sanctions

32.

As of September 30, 2020 and 2019, neither Codelco Chile nor its Directors and Managers have been
sanctioned by the CMF or any other administrative authorities.

Environmental Expenditures

Each of Codelco’s operations is subject to national, regional and local regulations related to protection of
the environment and natural resources, including standards relating to water, air, noise and disposal and
transportation of dangerous residues, among others. Chile has introduced environmental regulations that
have obligated companies, including Codelco, to carry out programs to reduce, control or eliminate relevant
environmental impacts. Codelco has executed and shall continue to execute a series of environmental
projects to comply with these regulations.

Pursuant to the Letter of Values approved in 2010, Codelco is governed by a series of internal policies and
regulations that frame its commitment to the environment, among which is the Corporate Sustainable
Development Policy (2016).

The environmental management systems of the divisions, structure their efforts in order to comply with the
commitments assumed by the corporation’s environmental policies, incorporating elements of planning,
operating, verifying and reviewing activities. As of September 30, 2020, Codelco is implementing a strategic
change process in all divisions to manage the aspects and risks associated with environmental matters,

109
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

under a corporate management system issued by Head Office, seeking to obtain the ISO 14001: 2015
certification.

In accordance with Supreme Decree D.S. No. 28, the Corporation is carrying out is environmental,
maintenance and operating plans for its smelting plants.

To comply with the Circular No. 1901 of 2008 of the CMF, the details of the Corporation’s main expenditures

related to the environment during the nine-month periods ended September 30, 2020 and 2019,
respectively, and the projected future expenses are stated below.

110
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Disbursements 9/30/2020 1213112019 Future committed
Entity Proyect name Proyect status | AYOUNt Assetl— | Asset/Expenditure | Amount | Amount | Estimated
ThUS$ Expense Hem Thus$ ThUS$ date

Chuquicamata
Codelco Chile: [Talambre dam capaciy extension, 8hh stage In Progress 18,206 | Asset P.P8E 58,947 16,267 | 2020
Codelco Chile: [Replacement of rculaion pot1A and 2 Finished | Asset P,P8E 8,306 -| 2019
Codelco Chile: [Constucion instalaion surplus management Finished | Asset P,P8E 706 -| 2019
Codelco Chile: [Replacement of water trealmentplant Finished | Asset P,P8E 4,792 -| 2019
Codelco Chile: [Replacement gas managementsystem Finished | Asset P,P8E 8,157 -| 2019
Codelco Chile. [Acid planttranformaton 3-4 DC/DA In Progress 966| Asset P,P8E 157,740 -| 2020
Codelco Chile: [Enablementreíning gas treatnentsystem In Progress 11922| Asset P,P8E 41,519 4381] 2020
Codelco Chile: [Dryer replacementn * 5 fuco In Progress 7805] — Asset P,P8E 31,909 497| 2020
Codelco Chile [Constucion Relle Res Dom-Asim Montec In Progress 3549] — Asset P,P8E 238 -| 2020
Codelco Chile [Constucion IX stage Talabre tanque Finished | Asset P,P8E 8,167 -| 2019
Codelco Chile [Constucion 8 Seg Montecristo In Progress 3906| Asset P.P8E 5,565 -| 2020
Codelco Chile. [Acid plants In Progress 12,824| Expenditre | Operatonal expenses 30.692 -| 2020
Codelco Chile |Solid waste In Progress 1,305 | Expenditre | Operatonal expenses 769 435| 2020
Codelco Chile: [Talings In Progress 16,063 | Expenditre | Operatonal expenses 16,987 -| 2020
Codelco Chile: [Water treatment plant In Progress 18,349 | Expendiure | Operatonal expenses 18,030 -| 2020
Codelco Chile: [Environmental monitoring In Progress 1.410 | Expenditre | Operatonal expenses 780 470] 2020
Codelco Chile. [Normalization drainage system dril hole In Progress 88| Asset P,P8E 778 2924 | 2021
Codelco Chile. [Standard handiing / feeding / ransportpowder In Progress 3,504] — Asset P,P8E – 16,203 | 2021
Codelco Chile [Constucion talabres thickened talings In Progress 4675] — Asset P,P8E – 21,675 | 2022

Total Chuquicamata 101,152 394,082 62,802

Salvador
Codelco Chile. |Improved integran of he gas process In Progress 9346] Asset P.P8E 69,547 13,215| — 2021
Codelco Chile: [Talings In Progress 3,289 | Expenditure | Operatonal expenses 2,318 -| 2020
Codelco Chile. [Acid plants In Progress 48,902 | Expenditure | Operatonal expenses 35.804 -| 2020
Codelco Chile |Solid waste In Progress 1,100 | Expenditre | Operatonal expenses 1,124 2020
Codelco Chile: [Water treatment plant In Progress 421| Expenditure | Operaional expenses 589 -| 2020
Codelco Chile: [Overhaul hickeners talings sal-proy Finished | Asset P.P8E 2.978 -| 2019
Codelco Chile [Dangerous substances warehouse Finished | Asset P,P8E 301 -| 2019
Codelco Chile: [Bell replacement In Progress | Asset P,P8E 19,241 -| 202
Codelco Chile: |Diteh hazardous waste Finished | Asset P,P8E 785 -| 2019
Codelco Chile [DRPA Emergency In Progress 2,62] — Asset P,P8E 3,819 27,794 | 2021
Codelco Chile [Compliance DS 43 storage dangerous substances In Progress 211] Asset P.P8E – 744| 2021

Total Salvador 65,381 136,506 44,753

Andina
Codelco Chile [Constucion site emergency plan Finished | Asset P,P8E 3.420 | 2019
Codelco Chile |Improved water internal ip E2 Finished | Asset P,P8E 256 -| 2019
Codelco Chile: [Catehment water drainage hil black Finished | Asset P,P8E 306 -| 2019
Codelco Chile [Constucion canal outine DL east In Progress 2887| — Asset P,P8E 4,234 2342| 2021
Codelco Chile [Constucion site emergency plan In Progress 1896 | — Asset P,P8E 3.860 588| 2020
Codelco Chile [Expansion dam In Progress 28291 | Asset P,P8E 36.314 7631] 2020
Codelco Chile [Constucion Stucure and instruments In Progress 910| Asset P,P8E 245 929] 2020
Codelco Chile [Water injection system Finished | Asset P,P8E 685 -| 2019
Codelco Chile: [constucton of pits containmentof spils In Progress 320| Asset P,P8E 119 -| 2020
Codelco Chile: [Valve and works raing In Progress 1,024 | — Asset P,P8E 618 2381] 2021
Codelco Chile [Construcion of catehment tower N.5 Finished | Asset P.P8E 188 | 2019
Codelco Chile |Solid waste In Progress 1,646 | Expenditre | Operatonal expenses 2,023 2020
Codelco Chile: [Water treatment plant In Progress 2,781 | Expenditure | Operational expenses 2.833 2020
Codelco Chile |Traiing In Progress 55,078 | Expenditre | Operatonal expenses 47,339 -| 2020
Codelco Chile [Acid drainage In Progress 24,502 | Expenditre | Operatonal expenses 20.290 -| 2020
Codelco Chile: [Environmental monitoring In Progress 646 | Expendiure | Operatonal expenses 623 -| 2020
Codelco Chile. |Sustainabiity and external maters management In Progress 1,295| Expenditre | Operatonal expenses 2,049 -| 2020
Codelco Chile [DLN conditoning works In Progress 7509] — Asset P,P8E – o A]
Codelco Chile [Constucion works mitigaton water shortage In Progress 654] — Asset P,P8E – 1010 | 2020
Codelco Chile [Excavation operation improvement In Progress 71] Asset P,P8E – 2922) 2021
Codelco Chile. [Water dispateh tunnel modifcaton In Progress 474] Asset P,P8E – 6182] 2021

Total Andina 136,074 125,402 33,230
Subtotal 302,607 655,990 | 137,785

111

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Disbursements 9/30/2020 1213112019 Future committed
Entity Proyect name Amount Asset/ Asset /Expenditure | Amount | Amount | Estimated
ThUS$ Expense Item Thus$ ThUS$ date
El Teniente
Codelco Chile [Constucion of7h phase of Carén In Progress 34,541 | Asset P.P8E 43020] 288,444 | 2023
Codelco Chile [Constucion of slag treatment plant In Progress 28579] — Asset P,P8E 76.833 5908] 2020
Codelco Chile |Smeling emissions network In Progress 2] Asset P.P8E 25,064 -| 2020
Codelco Chile. [Smoke capaciy reduction Finished -| Asa P.P8E 9,761 -| 2019
Codelco Chile [Constucion ofslag treatment plant In Progress 966| Asset P.P8E 576 -| 2020
Codelco Chile. [Acid plants In Progress 43,849 | Expenditure | Operatonal expenses 60,964 -| 2020
Codelco Chile |Solid waste In Progress 2,084 | Expenditure | Operatonal expenses 2,260 -| 2020
Codelco Chile: [Water treatment plant In Progress 10,646 | Expenditre | Operatonal expenses 10,000 -| 2020
Codelco Chile [Talings In Progress 46,766 | Expenditure | Operatonal expenses 46,767 -| 2020
Codelco Chile. [Well construcion and hydrogeology modifcaion Colihue-Cauquenes In Progress 60] Asset P.P8E – 4643 | — 2022
Codelco Chile. [Improvement of he container washing system fr fer plants In Progress 33| Asset P.PEE – -| 2020
Codelco Chile [Land acquisiton In Progress 6791] Asset P.P8E – -| 2020
Total El Teniente 174,317 216,145 | — 298,995
Gabriela Mistral
Codelco Chile: [Environmental monitoring In Progress 51| Expenditure | Operational expenses 45 -| 2020
Codelco Chile |Solid waste In Progress 1,316| Expenditure | Operatonal expenses 1,395 -| 2020
Codelco Chile: [Environmental consultancy In Progress 18| Expendiure | Operatonal expenses 99 -| 2020
Codelco Chile: [Water treatment plant In Progress 1| Expenditure | Operatonal expenses – -| 2020
Codelco Chile [Garbage dump extension In Progress -| Asa P.P8E 17,966 -| 2020
Codelco Chile. |Improved dust collecion system Finished -| Asa P.P8E 389 -| 2019
Total Gabriela Mistral 1,386 19,894 –
Ventanas
Codelco Chile. [Acid plants In Progress 18,860 | Expenditre | Operatonal expenses 18,143 -| 2020
Codelco Chi |Solid waste In Progress 1,045| Expenditre | Operatonal expenses 1,321 -| 2020
Codelco Chile: [Environmental monitoring In Progress 982| Expendiure | Operatonal expenses 1,097 -| 2020
Codelco Chile: [Water treatment plant In Progress 4,167 | Expenditure | Operational expenses 4,205 -| 2020
Codelco Chile |Distibuton system replacement Finished -| Asa P.P8E 268 -| 2019
Codelco Chile [Main chimney implementaton In Progress 254| — Asset P.P8E 236 75| 2020
Codelco Chile: |Implementaton of abalementwater sysem In Progress 79| Asset P.P8E – -| 2020
Codelco Chi |Stockpile improvement In Progress 97| Asset P.PEE – -| 2020
Codelco Chile. [Improvement ciosure facies and crusher belt In Progress 131) — Asa P.P8E – -| 2020
Codelco Chile |Stablized road operatons In Progress T6| Asset P.P8E – -| 2020
Total Ventanas 25,691 25,270 75
Radomiro Tomic
Codelco Chile [Solid waste In Progress 663 | Expendiure | Operatonal expenses 1,395 -| 2020
Codelco Chile: [Environmental monitoring In Progress 466| Expenditure | Operational expenses 144 -| 2020
Codelco Chile. [Water treatment plant In Progress 800 | Expendiure | Operatonal expenses – -| 2020
Total Radomiro Tomic 1,929 1,539 –
Ministro Hales
Codelco Chile [Solid waste In Progress 1,354 | Expenditure | Operational expenses 1,433 -| 2020
Codelco Chile: [Environmental monitoring In Progress -| Expenditure | Operatonal expenses 349 -| 2020
Codelco Chile: [Water treatment plant In Progress 129 | Expendiure | Operatonal expenses 106 -| 2020
Codelco Chile |Pitdrainage wels mine In Progress 191] — Asset P.P8E 900 -| 2020
Codelco Chile. |Implementaton monitoring acuifero pit In Progress 187| — Asset P.P8E 140 2967 | 2021
Codelco Chile |Silce barn extension and dome control room In Progress 7] ase P.P8E – 1569| 2021
Total Ministro Hales 1,868 2,928 4,536
Ecometales Limited
Codelco Chile: [Smeling powder leaching plant In Progress 344 | Expendiure | Operatonal expenses 547 204| 2020
Codelco Chile. [Smeling powders leaching plant In Progress 6| Expenditure | Operaional expenses 7 2| 2020
Total Ecometales Limited 350 554 206
Subtotal 205,541 326,330] 303,812
[Total [508,148 [ 982,320] 441,597]

112

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE INTERIM CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

33. Subsequent events

– On October 2, 2020, it is reported as an essential fact that as of October 16, 2020, Mr. Alvaro Aliaga Jobet,
Vice President of North Operations and Mr. José Robles Becerra, Vice President of Productivity and Costs
will cease to work at Codelco.

From that same date, Mr. Mauricio Barraza Gallardo will assume as acting t Vice President of North
Operations and Mr. Alejandro Rivera Stambuck as acting Vice President of Productivity and Costs,
notwithstanding the foregoing, both will continue to hold their positions as Vice President of South Central
Operations and Vice President of Administration and Finance, respectively.

– On October 27, 2020, the Corporation filed appeals and cassation in the form of the sentence of the 25th
Civil Court of Santiago, which dismissed the action for annulment of Public Law filed by the copper company
against Report No. 900 of 2016 of the Comptroller General of the Republic.

Management of the Corporation is not aware of other significant events of a financial nature or of any other nature
that could affect these financial statements, occurring between October 1, 2020 and the date of issue of these
consolidated financial statements as of October 29, 2020.

Octavio Araneda Osés Alejandro Rivera Stambuk
Chief Executive Officer Chief Financial Officer
Juan Ogas Cabrera Cristóbal Parrao Cartagena
Accounting Manager Accounting Director (1)

113
CORPORACION NACIONAL
DEL COBRE DE CHILE

Consolidated financial statements
As of and for the years ended
December 31, 2019 and 2018
and independent auditors” report
m
Deloitte. os

Auditores y Consultores Limitada
Rosario Norte 407

Rut: 80.276.200-3

Las Condes, Santiago

Chile

Fono: (56) 227 297 000

Fax: (56) 223 749 177
deloittechileOdeloitte.com
www.deloitte.cl

INDEPENDENT AUDITORS” REPORT

To the Chairman and Board of Directors of
Corporación Nacional del Cobre de Chile

We have audited the accompanying consolidated financial statements of Corporación Nacional
del Cobre de Chile and its subsidiaries (the “Company”), which comprise the consolidated
statements of financial position as of December 31, 2019 and 2018 and the related
consolidated statements of comprehensive income, changes in equity and cash flows for the
years then ended and the related notes to the consolidated financial statements.

Management’s Responsibility for the Consolidated Financial Statements

Management is responsible for the preparation and fair presentation of these consolidated
financial statements in accordance with International Financial Reporting Standards as issued
by the International Accounting Standards Board (“IASB”). This responsibility includes the
design, implementation, and maintenance of internal control relevant to the preparation and
fair presentation of consolidated financial statements that are free from material misstatement,
whether due to fraud or error.

Auditors” Responsibility

Our responsibility is to express an opinion on these consolidated financial statements based on
our audits. We performed our audits in accordance with auditing standards generally accepted
in Chile. Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the consolidated financial statements are free from material
misstatement.

An audit includes performing procedures to obtain audit evidence about the amounts and
disclosures in the consolidated financial statements. The procedures selected depend on the
auditor”s judgment, including the assessment of the risks of material misstatement of the
consolidated financial statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the preparation and fair
presentation of the entity’s consolidated financial statements in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the entity”s internal control. Accordingly, we express no such
opinion. An audit also includes assessing the appropriateness of the accounting policies used
and the reasonableness of the significant estimates made by the Company’s Management, as
well as evaluating the overall presentation of the consolidated financial statements.

Deloitte? se refiere a Deloitte Touche Tohmatsu Limited una compañía privada limitada por garantía, de Reino Unido, y a su red de firmas miembro, cada una de las cuales es una
entidad legal separada e independiente. Por favor, vea en www.deloitte.com/c//acercade la descripción detallada de la estructura legal de Deloitte Touche Tohmatsu Limited y sus
firmas miembro.

Deloitte Touche Tohmatsu Limited es una compañía privada limitada por garantía constituida en Inglaterra 8: Gales bajo el número 07271800, y su domicilio registrado: Hill House,
1 Little New Street, London, EC4A 3TR, Reino Unido.
We believe that the audit evidence that we have obtained is sufficient and appropriate to
provide a basis for our audit opinion.

Opinion

In our opinion, the consolidated financial statements referred to above present fairly, in all
material respects, the financial position of Corporación Nacional del Cobre de Chile and its
subsidiaries as of December 31, 2019 and 2018, and the results of their operations and their
cash flows for the years then ended in accordance with International Financial Reporting
Standards as issued by the International Accounting Standards Board. (“IASB”).

Other matter — Translation into English

The accompanying consolidated financial statements have been translated into English solely
for the convenience of readers outside of Chile.

arch 26, 2020

Santiago, Chile
O

CODELCO

CODELCO – CHILE

Consolidated Financial Statements as of and for the years ended December 31,
2019 and 2018

(Translation into English of the consolidated financial statements originally issued
in Spanish — see Note 1.2)
TABLE OF CONTENTS
CONSOLIDATED FINANCIAL STATEMENTS
(Translation into English of the consolidated financial statements originally issued in Spanish – see Note 1.2)

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)..
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)..
CONSOLIDATED STATEMENTS OF CASH FLOWS – DIRECT METHOD…
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY …………….. 12
L GENERAL INFORMATION…………….w…
1. Corporate Information
2. Basis of Presentation of the Consolidated Financial Statements
ll. SIGNIFICANT ACCOUNTING POLICIES..
1. Significant Judgments and Key Estimates …
2. Significant accounting policies ……………o.oo.o.. .19
3. New standards and interpretations adopted by the Corporation
4. New accounting pronouncements
1. EXPLANATORY NOTES ……….. 43
Cash and cash equivalents …
Trade and other receivables… ennsaranaranasa .44
Balance and transactions with related parties ..
InventorieS oo.oococncncnnonnnanocaninacnanaconanos
Income taxes and deferred taxes……..
Current and non-current tax assets and liabilities.
Property, Plant and Equipment …….oooccccononcnnanonos .55
Investments accounted for using the equity method.
9. Intangible assets other than goodwill .
10. SubsidiarieS ……ocoonononononononaconrnosoross
11. Current and non-current financial assets
12. Other financial liabilitieS …………..o.o.onono.
13. Fair Value of financial assets and liabilities .
14. Fair value hierarchy……….ococoooom.o.
15. Trade and other payables ..
16. Other provisions …….
17. Employee benefits
18. Equity ……….
19. Revenue…….
20. Expenses by nature…
21. Impairment of Assets …………..co….
22. Other income and expenses by function.
23. Finance COSÉS ..cononononnonnnonnanannananos
24. Operating segments……….
25. Foreign exchange differenc
26. Statement of cash flOwS ……….ococoooosoms
27. Financial risk management, objectives and policies

SAPARPPNS
. Derivatives contracts . 106
. Contingencies and restrictions. 109
. Guarantees … 115

. Balances in foreign currency … 116
. Sanctions … 120
. Environmental Expenditures … 120
. Subsequent events … 123

CORPORACION NACIONAL DEL COBRE DE CHILE
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
As of December 31, 2019 and 2018
(In thousands of US dollars – TRUS$)
(Translation into English of the consolidated financial statements originally issued in Spanish – see Note 1.2)

12/31/2019 12/31/2018
Notes
Assets
Current Assets
Cash and cash equivalents 1 1,303,105 1,229,125
Other current financial assets 11 172,951 231,409
Other current non-financial assets 20,969 6,805
Trade and other currentreceivables 2 2,588,268 2,212,209
Accounts receivable from related parties, current 3 20,874 92,365
Inventories 4 1,921,135 2,042,648
Currenttax assets 6 22,719 13,645
Total current assets other than assets or groups ofassets for
disposition classified as held for sale or held as distributable to 6,050,021 5,828,206
owners
Total current assets 6,050,021 5,828,206
Non-current assets
Other non-current financial assets 11 91,800 145,751
Other non-current non-financial assets 4,561 6,817
Non-currentreceivables 2 98,544 84,731
Accounts receivable from related parties, non-current 3 15,594 20,530
Non-current inventories 4 585,681 457,070
Investments accounted for using equity method 8 3,483,523 3,568,293
Intangible assets other than goodwill 9 47,837 48,379
Property, plantand equipment 7 29,700,164 26,754,998
Investment property 981 981
Recoverable non-current tax assets 6 222,169 143,606
Deferred tax assets 5 43,736 31,443
Total non-current assets 34,294,590 31,262,599
Total Assets 40,344,611 37,090,805

The accompanying notes are an integral part of these consolidated financial statements.
CORPORACION NACIONAL DEL COBRE DE CHILE
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
As of December 31, 2019 and 2018
(In thousands of US dollars – TRUS$)
(Translation into English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Notes 12/31/2019 12/31/2018
No
Liabilities and Equity
Liabilities
Current liabilities
Other current financial liabilities 12 1,378,351 872,277
Trade and other current payables 15 1,420,915 1,546,584
Accounts payable to related parties, current 3 137,234 150,916
Other current provisions 16 502,172 384,249
Current tax liabilities 6 13,857 10,777
Current provisions for employee benefits 17 435,565 510,034
Other current non-financial liabilities 34,863 64,575
| Total current liabilities 3,922,957 3,539,412 |
Non-current liabilities
Other non-current financial liabilities 12 16,538,223 14,674,510
Non-current payables 8,346 26,613
Other non-current provisions 16 2,090,487 1,600,183
Deferred tax liabiliies 5 4,860,881 4,586,168
Non-current provisions for employee benefits 17 1,283,357 1,315,520
Other non-current non-financial liabiliies 5,693 4,530
Total non-current liabilities 24,786,987 22,207,524
Total liabilities 28,709,944 25,746,936
Equity
Issued capital 5,619,423 5,219,423
Accumulated deficit (196,260) (198,917)
Other reserves 18 5,291,747 5,354,159
| Equity attributable to owners of the parent 10,714,910 10,374,665 |
Non-controlling interests 18 919,757 969,204
Total equity 11,634,667 11,343,869
[| Total liabilities and equity 40,344,611 37,090,805 |

The accompanying notes are an integral part of these consolidated financial statements.
CORPORACION NACIONAL DEL COBRE DE CHILE

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)

For the years ended December 31, 2019 and 2018
(In thousands of US dollars – TRUS$)

(Translation into English of the consolidated financial statements originally issued in Spanish — see

Note 1.2)

Notes 1/1/2019 1/1/2018

N? 12/31/2019 12/31/2018
Revenue 19 12,524,931 14,308,758
Costof sales (10,051,441) (11,194,341)
[Gross profit 2,473,490 3,114,417 |
Other Income, by function 22a 360,690 124,826
Provision established net, in accordance with IFRS 9 378 158
Distribution costs (17,069) (18,262)
Administrative expenses (409,234) (465,328)
Other expenses 22b (1,747,838) (2,115,314)
Other gains 22,672 21,395
[Income from operating activities 683,089 661,892 |
Finance income 36,871 51,329
Finance costs 23 (479,307) (463,448)
Share of profit of associates and joint ventures accounted for using equity method 8 13,203 119,114
Foreign exchange difference 25 153,917 178,143
[Income for the years before tax 407,773 547,030 |
Expense – income taxes 5 (393,245) (357,283)
[Net income for the years 14,528 189,747 |
Net income attributable to owners of parent 6,637 155,719
Netincome attributable to non-controlling interests 18.b 7,891 34,028
[Net income for the years 14,528 189,747 |

The accompanying notes are an integral part of these consolidated financial statements.
CORPORACION NACIONAL DEL COBRE DE CHILE
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
CONTINUED
For the years ended December 31, 2019 and 2018
(In thousands of US dollars – TRUS$)
(Translation into English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Notes 1/1/2019 1/1/2018
No 12/31/2019 12/31/2018
[Net income for the years 14,528 189,747 ]

Components of other comprehensive income that will not be reclassified to
profit or loss, before tax:

Losses on remeasurementof defined beneft plans, before tax (100,957) (48,626)
Share of other comprehensive (loss) income of associates and joint ventures accounted

for using the equity method that will not be reclassified 2363 (1,517)
per comprehensive loss that will not be reclassified to profit or loss before (98,594) (650,243)
Components of other comprehensive income that will be reclassified to profit
or loss, before tax:
Gains (losses) on exchange difference on translation, before tax 191 (848)
(Losses) gains on cash flow hedges, before tax (80,111) 104,160
Share ofother comprehensive income of associates and joint ventures accounted for

. . . . (3,275) 554
using equity method that will be reclassified
Other comprehensive (loss) income that will be reclassified to profit or loss (83,195) 103,866
before tax
Other comprehensive (loss) income, before tax (181,789) 53,623
Income tax effect on component of other comprehensive income which will
not be reclassified profit or loss
Netincome tax efect relating to benefit plans in other comprehensive income 5 69,667 33,148
Net income (loss) tax of components of other comprehensive income which
will be reclassified to profit or loss
Netincome (loss) tax relating to cash fow hedges of the other comprehensive income 5 52,072 (67,704)
Total other comprehensive (loss) income (60,050) 19,067
Total Comprehensive (loss) Income (45,522) 208,814
Comprehensive (loss) income attributable to:
Comprehensive (loss) income attributable to owners of the parent (53,413) 174,786
Comprehensive income attributable to non-controlling interests 18.b 7,891 34,028
[Total comprehensive (loss) income (45,522) 208,814 ]

The accompanying notes are an integral part of these consolidated financial statements.

10
CORPORACION NACIONAL DEL COBRE DE CHILE
CONSOLIDATED STATEMENTS OF CASH FLOWS – DIRECT METHOD
For the years ended December 31, 2019 and 2018
(In thousands of US dollars – TRUS$)
(Translation into English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Notes 1/1/2019 1/1/2018
12/31/2019 12/31/2018
Cash flows provided by (used in) operating activities:
Receipts from sales of goods and rendering of services 12,553,666 15,428,893
Other cash receipts from operating activities 26 1,827,264 1,733,555
Payments to suppliers for goods and services (7,917,563) (8,870,763)
Payments to and on behalf of employees (1,800,223) (1,920,204)
Other cash payments from operating activities 26 (2,237,355) (2,555,184)
Dividends received 87,434 188,749
Income taxes paid (81,762) (67,326)
| Cash fows provided by operating actvites 2,431,461 3,937,720 |
Cash flows provided by (used in) investing activities:
Other payments to acquire equity or debt instruments of other entities (240) (338)
Other charges for the sale of interests in join ventures and associates 8 193,480 21,842
Purchase of property, plantand equipment (4,102,073) (3,893,851)
Interest received 33,874 47,259
Other cash outlows (5,078) (127,570)
| Cash fows used in investing actvites (3,880,037) (3,952,658)
Cash flows provided by (used in) financing activities:
Proceeds from borrowings long term 3,918,199 900,000
Proceeds from borrowings short term 465,000 –
Total proceeds from borrowings 4,383,199 900,000
Repayment of borrowings (2,234,446) (259,011)
Payments of finance lease liabilities (148,181) (27,130)
Dividends paid – (602,461)
Interest paid (656,705) (634,289)
Other cash infows 197,555 500,802
Cash fiows provided by (used) in financing activities 1,541,422 (122,089)
Increase (decrease) in cash and cash equivalents before effects of exchange 92,846 (137,027)
diference
Effect ofexchange rate changes on cash and cash equivalents (18,866) (82,683)
Increase (decrease) in cash and cash equivalents 73,980 (219,710)
Cash and cash equivalents at beginning of years 1 1,229,125 1,448,835
Cash and cash equivalents atend ofyears 1 1,303,105 1,229,125

The accompanying notes are an integral part of these consolidated financial statements.

11
CORPORACION NACIONAL DEL COBRE DE CHILE
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
For the years ended December 31, 2019 and 2018

(In thousands of US dollars – ThUS$)
(Translation into English of the consolidated financial statements originally issued in Spanish – see Note 1.2)

December 31,2019

Initial balance as of 1/1/2019
in
Netincome
Other income:
e income
Dividends
contributions
Increase (decrease
Total es in
Final balance as of 12/31/2019

transfers and other

December 31,2018

Initial balance as of 1/1/2018
in
Netincome
Other income:
e income
Dividends
contributions
Increase (decrease
Total es in
Final balance as of 12/31/2018

transfers and other

Issued capital

400,000

Issued capital

600,000

423

Reserve on
exchange
diferences on
translation

Reserve on
exchange
difference on
translation

01:

Reserve of
remeasurement of
Reserve of cash flow

hedges defined benefit plans

24
19,506
Reserve of
Reserve ofcash flow | remeasurement of

hedges defined benefit plans

Note 17
11,336

456 154
47,792 4,

Other
miscellaneous
reserves

5,587,710

41
5,584,683
Other

miscellaneous
reserves

1
5,587,710

The accompanying notes are an integral part of these consolidated financial statements.

Total other
reserves

Note 18

Total other
reserves
Note 18

Accumulated
deficit

(3,980)
657

Accumulated
deficit

155,719

306,619)

13,
A
A

Equity
attibutable to

owners ofthe

parent

1

1

14,665

6,637
60,
53,413)

400,000
6,

340,245

714,910

Equity
atributable to

owners ofthe

parent

1

,125

155,719
19,067
174,786
306,61
600,000
13,
454,
14,665

Non-contrlling

Total E
interests ol Equity

Note 18
969,

7,891
– 160,
7,891

– 400,000
57, (63,
(49, 798

919,757 11,634,667

Non-contrlling
interests
Note 18

1,007,495

Total Equity

10,927,620

34,028 189,747
– 19,067
34,028 208,814
306,61
600,000
85,
416,249

12
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

GENERAL INFORMATION
Corporate Information

Corporación Nacional del Cobre de Chile (hereinafter referred to as “Codelco”, “Codelco – Chile”, or the
“Corporation”), is, in Management’s opinion, the largest copper producer in the world. Codelco’s most
important product is refined copper, primarily in the form of cathodes. The Corporation also produces
copper concentrates, blister and anode copper and by-products such as molybdenum, anode slime and
sulfuric acid.

The Corporation trades ¡ts products based on a policy aimed to sell refined copper to manufacturers or
producers of semi-manufactured products.

These products contribute to diverse fields of community development, particularly those intended to
improve areas such as public health, energy efficiency, and sustainable development, among others.

Codelco-Chile is registered under Securities Registry No. 785 of the Chilean Commission for the Financial
Market (the “CMF”), and is subject to its supervision. According to Article No. 10 of Law No. 20392
(related to the new Corporate Governance of Codelco), such supervision shall be on the same terms as
publicly traded companies, notwithstanding the provisions in Decree Law (D.L.) No.1349 of 1976, which
created the Comisión Chilena del Cobre (“Chilean Copper Commission”).

Codelco’s head office is located in Santiago, Chile, at 1270 Huérfanos Street, telephone number (56-2)
26903000.

Codelco was incorporated through D.L. No. 1350 of 1976, which is the statutory decree applicable to the
Corporation. In accordance with the statutory decree, Codelco is a government-owned mining, industrial
and commercial company, which is a separate legal entity with its own equity. Codelco Chile currently
carries out its mining business through its Chuquicamata, Radomiro Tomic, Ministro Hales, Gabriela
Mistral, Salvador, Andina, El Teniente and Ventanas divisions.

The Corporation also carries out similar activities in other mining deposits in association with third parties.

In accordance with letter e) of Article 10 of Law No. 20392, Codelco is governed by its organic standards
set forth in Decree Law No. 1350 (D.L. No. 1350) and that of its by-laws, and in matters not covered by
them and, insofar as they are compatible and do not contradict the provisions of such standards, by the
rules that govern publicly traded companies and the common laws as applicable to them.

In accordance with D.L. No. 1350 Section IV related to the Company’s Exchange and Budget Regulations.
Codelco’s financial activities are conducted following an annual budgeting program that is composed of an
Operations Budget, an Investment Budget and a Debt Amortization Budget.

The tax system applicable to Codelco’s taxable income is in accordance with Article 26 of D. L. No.1350
which refers to Decree Law No. 824 on Income Tax of 1974 and Decree Law No. 2398 (Article 2) of 1978,

13
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

2.

as applicable. The Corporation’s taxable income is also subject to a Specific Mining Tax in accordance
with Law No. 20026 of 2005.

The Corporation is subject to Law No. 13196, which mandates the payment of a 10% tax over the foreign
currency return on the actual sale revenue of copper production, including its by-products. On January 27,
2017, Law No. 20989, article 3, establishes changes in the application of Law No. 13196 as of January 1,
2018, through which the Corporation will deposit annually, no later than December 15 of each year, the
funds established in article 1 in that law.

On September 26, 2019, Law No. 21174 was published, which repeals Law No. 13,196 and establishes
that the 10% tax to the tax benefit provided by the Corporation will continue to exist for a period of nine
years, decreasing from year 10 2.5% per year until reaching 0% at the beginning of the thirteenth year.
The validity of this law is as of January 1, 2020.

The subsidiaries whose financial statements are included in these audited consolidated financial statements
correspond to companies located in Chile and abroad, which are detailed in Note 11.2.d.

The associates and joint ventures located in Chile and abroad, are detailed in the Explanatory Notes
Section 11! of Note 8.

Basis of Presentation of the Consolidated Financial Statements

The Corporation’s consolidated statements of financial position as of December 31, 2019 and 2018, and
the consolidated statements of comprehensive income, changes in equity and of cash flows for the years
ended December 31, 2019 and 2018, have been prepared in accordance with International Financial
Reporting Standards (*IFRS”) as issued by the International Accounting Standards Board (“lASB”).

These consolidated financial statements include all information and disclosures required in annual
financial statements.

These consolidated financial statements have been prepared from accounting records maintained by the
Corporation.

The consolidated financial statements of the Corporation are presented in thousands of United States
dollar (*U.S. dollar”).

Responsibility for the Information and Use of Estimates

The Board of Directors of the Corporation has been informed of the information included in these
consolidated financial statements and expressly declared its responsibility for the consistent and reliable
nature of the information included in such financial statements as of and for the year ended December 31,
2019, which financial statements fully comply with IFRS as issued by the lASB. These consolidated
financial statements as of December 31, 2019 and for the year then ended were approved by the Board of
Directors at a meeting held on March 26, 2020.

14
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Accounting Principles

These consolidated financial statements reflect the financial position of Codelco and its subsidiaries as of
December 31, 2019 and 2018, and the results of their operations, changes in equity and cash flows for the
years ended December 31, 2019 and 2018, and their related notes, all prepared in accordance with lAS 1,
“Presentation of Financial Statements,” in consideration of the presentation instructions of the Commission
for the Financial Markets, where not in conflict with IFRS.

For the convenience of the reader, these consolidated financial statements and their accompanying notes
have been translated from Spanish into English.

SIGNIFICANT ACCOUNTING POLICIES
Significant Judgments and Key Estimates

In preparing these consolidated financial statements, the use of certain critical accounting estimates and
assumptions that affect the amounts of assets and liabilities recognized as of the date of the financial
statements and the amounts of revenue and expenses recognized during the reporting period is required.
Such preparation also requires the Corporation’s Management to exercise its judgment in the process of
applying the Corporation’s accounting policies. The areas involving a higher degree of judgment or
complexity, or areas where assumptions and estimates are significant to the consolidated financial
statements are as follows:

a) Useful economic lives and residual values of property, plant and equipment – The useful lives
and residual values of property, plant and equipment that are used for calculating depreciation are
determined based on technical studies prepared by specialists (internal or external). The technical
studies consider specific factors related to the use of assets.

When there are indicators that could lead to changes in the estimates of the useful lives of such
assets, these changes are made by using technical estimates to determine the impact of any change.

b) Ore reserves – The measurements of ore reserves are based on estimates of the ore resources that
are legally and economically exploitable, and reflect the technical and environmental considerations
of the Corporation regarding the amount of resources that could be exploited and sold at prices
exceeding the total cost associated with the extraction and processing.

The Corporation applies prudent judgment in determining the ore reserves, and as such, possible
changes in these estimates might significantly impact the estimates of net revenues over time. In
addition, these changes might lead to modifications in usage estimates, which might have an effect
on depreciation and amortization expense, calculation of stripping cost adjustments, determination of
impairment losses, expected future disbursements related to decommissioning and restoration
obligations, long term defined benefits plans’ accounting and the accounting for financial derivative
instruments.

15
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The Corporation estimates ¡ts reserves and mineral resources based on the information certified by
the Competent Persons of the Corporation, who are defined and regulated according to Law No.
20235. These estimates correspond to the application of the Certification Code of Ore Reserves,
Resources and Exploration, issued by the Mining Committee which was instituted through the
aforementioned law. This does not modify the global volume of the Corporation’s ore reserves and
resources.

Notwithstanding the above, the Corporation also periodically reviews such estimates, supported by
world-class external experts, who certify the reserves as determined.

c) Impairment of non-financial assets – The Corporation reviews the carrying amount of its assets
to determine whether there is any indication that those assets have suffered an impairment loss. If
any such indicator exists, the recoverable amount of the assets is estimated in order to determine
the extent of the impairment loss. In testing impairment, the assets are grouped into cash
generating units (“CGUs”) to which the assets belong, where applicable. The recoverable amount
of these CGUs is calculated as the present value of the expected future cash flows from such
assets, considering a pre-tax discount rate that reflects current market assessments of the time
value of money and the risks specific to the asset. If the recoverable amount of the assets is lower
than their carrying amount, an impairment loss is recognized. Goodwill and indefinitely-lived assets
are tested for impairment at least annually.

The Corporation defines the CGUs and also estimates the timing and cash flows that such CGUs will
generate. Subsequent changes in the grouping of the CGU, or changes in the assumptions
supporting the estimates of cash flows or the discount rate, may impact the carrying amounts of the
corresponding assets.

Estimates of assumptions influencing the calculation of cash flows, such as the price of copper or
treatment charges and refining charges, among others, are determined based on studies conducted
by the Corporation using uniform criteria over different periods. Any changes to these criteria may
impact the estimated recoverable amount of the assets.

The Corporation has assessed and defined that the CGUs are determined at the level of each of its
current operating divisions.

Impairment testing also is performed at the level of associates and joint arrangements.

d) Provisions for decommissioning and site restoration costs – The Corporation is obliged to incur
decommissioning and site restoration costs when such site restoration or decommissioning is
required due to a legal or constructive obligation. Costs are estimated on the basis of a formal
closure plan and are reassessed annually or as of the date such obligations become known. The
initial estimate of decommissioning and site restoration costs is recognized as property, plant and
equipment in accordance with IAS 16, and simultaneously a liability in accordance with IAS 37, is
recorded.

16
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

For these purposes, a defined list of mine sites, facilities and other equipment are studied under this
process, considering the engineering level profile, the cubic meters of assets that will be subject to
removal and restoration, weighted by a structure of market prices of goods and services, reflecting
the best current knowledge related to carrying out such activities, as well as techniques and more
efficient construction procedures to date. In the process of valuation of these activities, the
assumptions of the exchange rate for tradable goods and services is made, as well as a discount
rate, which considers the time value of money and the risks associated with the liabilities, which ¡is
determined based, where applicable, on the currency in which disbursements are expected to be
made.

The liability amounts recognized at the end of each reporting date represent management’s best
estimate of the present value of the future decommissioning and site restoration costs. Changes to
estimated future costs that result from changes in the estimated timing or amount of the outflow of
resources embodying economic benefits required to settle the obligation, or a change in the discount
rate are added to, or deducted from, the cost of the related asset in the current period (as well as the
associated liability). The amount deducted from the cost of the asset shall not exceed its carrying
amount. If a decrease in the liability exceeds the carrying amount of the asset, the excess is
recognized immediately in profit or loss.

If the adjustment results in an addition to the cost of the asset, Codelco considers whether this is an
indicator that the new carrying amount of the asset may not be fully recoverable. If it is considered
such an indicator, Codelco tests the asset for impairment by estimating its recoverable amount, and
accounts for any impairment loss in accordance with IAS 36.

The decommissioning costs are initially recorded at the moment when a plant or other assets are
installed. Such costs are capitalized as part of property, plant and equipment and discounted to their
present value. These decommissioning costs are charged to net income over the life of the mine,
through depreciation of the corresponding asset. Depreciation expense ¡is included in cost of sales,
while the unwinding of the discount in the provision is included in finance costs.

e) Provisions for employee benefits – Provisions for employee benefits related to severance
payments and health benefits for services rendered by the employees are determined based on
actuarial calculations using the projected unit credit method, and are recognized in other
comprehensive income or profit or loss (depending on the accounting standards applicable).on
accrual bases.

The Corporation uses assumptions to determine the best estimate of future obligations related to
these benefits. Such estimates, as well as assumptions, are determined by management using the
assistance of external actuaries. These assumptions include demographic assumptions, discount
rate and expected salary increases and rotation levels, among other factors.

f) Accruals for open invoices – The Corporation uses information on future copper prices, through
which it recognizes adjustments to ¡ts revenues and trade receivables, due to the conditions in

17
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

provisional pricing arrangements. These adjustments are updated on a monthly basis, See Notes 2 r)
“Revenue from contracts with customers” of Note 2 “Significant accounting policies” below.

g) Fair value of derivatives and other financial instruments – Management may use its judgment to
choose an adequate and proper valuation method for financial instruments that are not quoted in an
active market. In the case of derivative financial instruments, assumptions are based on observable
market inputs, adjusted depending on factors specific to the instruments among others.

h) Lawsuits and contingencies – The Corporation assesses the probability of lawsuits and
contingency losses on an ongoing basis according to estimates performed by its legal advisors. For
cases in which management and the Corporation’s legal advisors believe that a loss is not probable
of occurring or where probable, may not be estimated reliably, no provisions are recognized. When it
is considered more likely than not that a loss is probable and it may be reliably estimated, a provision
is recognized.

i) Application of IFRS 16 that include the following:

– Estimation of the lease term;
– Determine if it is reasonably certain that an extension or termination option will be exercised;
– Determination of the appropriate rate to discount lease payments.

j) Revenue recognition -The Corporation determines appropriate revenue recognition for its contracts
with customers by analyzing the type, terms and conditions of each contract or agreement with a
customer.

As part of the analysis, the management must make judgments about whether an agreement or
contract is legally enforceable, and whether the agreement includes separate performance
obligations. In addition, estimates are required in order to allocate the total price of the transaction to
each performance obligation based on the stand-alone selling price of the promised goods or
services underlying each performance obligation. (The Corporation applies the constraint on variable
consideration as defined in IFRS 15, if applicable).

Although the abovementioned estimates have been made based on the best information available as of
the date of issuance of these consolidated financial statements, it is possible that new developments
could lead the Corporation to modify these estimates in the future. Such modifications, if applicable,
would be adjusted prospectively, as required by IAS 8 “Accounting Policies, Changes in Accounting
Estimates and Errors.”

18
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

2.

Significant accounting policies

a)

b)

d)

Period covered – The accompanying consolidated financial statements of Corporación Nacional del
Cobre de Chile include the following statements:

– Consolidated statements of financial position as of December 31, 2019 and 2018.

– Consolidated statements of comprehensive income for years ended December 31, 2019 and
2018.

– Consolidated statements of changes in equity for years ended December 31, 2019 and 2018.

– Consolidated statements of cash flows for years ended December 31, 2019 and 2018.

Basis of preparation – The consolidated financial statements of the Corporation as of December 31,
2019 and 2018, and for the years ended December 31, 2019 and 2018 have been prepared in
accordance with the instructions from the Commission for the Financial Market which fully comply
with IFRS as issued by the lASB.

The consolidated statement of financial position as of December 31, 2018, and the consolidated
statement of comprehensive income for the year ended December 31, 2018, the consolidated
statement of changes in equity and consolidated statement of cash flows for the year ended
December 31, 2018, which are included for comparative purposes, have been prepared in
accordance with IFRS issued by the IASB, on a basis consistent with the criteria used for the same
period ended December 31, 2019, except for the adoption of the new IFRS standards and
interpretations adopted by the Corporation as of and for the years ended December 31, 2019, which
are disclosed in note 11.3.

These consolidated financial statements have been prepared based on the accounting records kept
by the Corporation.

Functional Currency – The functional currency of Codelco is the U.S. dollar, which is the currency of
the primary economic environment in which the Corporation operates and the currency in which it
receives ¡ts revenues.

The functional currency of subsidiaries, associates and joint ventures, is the currency of the primary
economic environment in which those entities operate and the currency in which they receive their
revenues. For those subsidiaries and associates that are an extension of the operations of Codelco
(entities that are not self-sustaining and whose main transactions are with Codelco); the functional
currency is also the U.S. dollar.

The presentation currency of Codelco’s consolidated financial statements is the U.S. dollar.

Basis of consolidation – The consolidated financial statements incorporate the financial statements
of the Corporation and its subsidiaries.

19
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Subsidiaries are fully consolidated from the date of acquisition, being the date on which the
Corporation obtains control, and continue to be consolidated until the date such control ceases.
Specifically, income and expenses of a subsidiary acquired or disposed of during the year are
included in the consolidated statement from the date the Corporation gains control until the date
when the Corporation ceases to control the subsidiary.

The financial statements of the subsidiaries are prepared for the same reporting period as the
Corporation, using consistent accounting policies.

All assets, liabilities, equity, income, expenses and cash flows related to transactions between
consolidated companies are fully eliminated on consolidation. Non-controlling interests in equity and
in the comprehensive income of the consolidated subsidiaries are presented, respectively, under the
line items “Total Equity: Non-controlling interests” in the consolidated statement of financial position
and “Net income attributable to non-controlling interests” and “Comprehensive income attributable to
non-controlling interests” in the consolidated statement of comprehensive income.

20
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The companies included in the consolidation are as follows:

12/31/2019 12/31/2018
Taxpayer ID Number Company Country Currency % Ownership % Ownership
Direct | Indirect Total Total
Foreign Chile Copper Limited England EP 100.00] a] 100.00 100.00]
Foreign Codelco do Brasil Mineracao Brazil BRL a] 100.00 100.00 100.00]
Foreign Codelco Group Inc. United States of US$ 100.00] dl 100.00 100.00]
America
Foreign Codelco International Limited Bermuda US$ 100.00] a] 100.00 100.00]
Foreign Codelco Kupferhandel GmbH Germany EURO 100.00] a] 100.00 100.00]
Foreign Codelco Metals Ino. United States of | ¡og 0] 100.00] 100.00] 100.00]
America
Foreign Codelco Services Limited England Gap a] 100.00 100.00 100.00]
Foreign Codelco Shanghai Company Limited China RMB 100.00] a] 100.00 100.00]
Foreign Codelco Technologies Ltd. Bermuda US$ a] J – 100.00]
Foreign Codelco USA Inc. United States of US$ a] 100.00 100.00 100.00]
America
Foreign Codelco Canada Canada US$ a] 100.00 100.00 100.00]
Foreign Ecometales Limited Channel Islands | US$ a] 100.00 100.00 100.00]
Foreign Exploraciones Mineras Andinas Ecuador EMSAEC S.A. Ecuador US$ a] 100.00 100.00 100.00]
Foreign Cobrex Prospeccao Mineral Brazil BRL a] 51.00] 51.00 51.00
78.860.780-6 Compañía Contractual Minera los Andes Chile US$ 99.97 0.03 100.00 100.00]
79.506.720-2 Isapre Chuquicamata Ltda. Chile CLP 0.00] 0.00 – 100.00]
81.767.200-0 Asociación Garantizadora de Pensiones Chile CLP 96.59 a] 96.69 96.59
88.497.100-4 Clínica San Lorenzo Limitada Chile CLP 99.90 0.10 100.00 100.00]
76.521.202 San Lorenzo Institución de Salud Previsional Ltda. Chile CLP a] 100.00 100.00 100.00]
89.441.300-K Isapre Río Blanco Ltda Chile CLP a] a] – 100.00]
96.817.780-K Ejecutora Proyecto Hospital del Cobre Calama S.A. Chile US$ 99.99 0.01 100.00 100.00]
96.819.040-7 Complejo Portuario Mejilones S.A Chile US$ 99.99 0.01 100.00 100.00]
96.991.180-9 Codelco Teo SpA Chile US$ 99.91 0.09 100.00 100.00]
99.569.520-0 Exploraciones Mineras Andinas S.A. Chile US$ 99.90 0.10 100.00 100.00]
99.573.600-4 Clínica Río Blanco S.A. Chile CLP 99.00 1.00] 100.00 100.00]
76.064.682-2 Centro de Especialidades Médicas Río Blanco Lta Chile CLP 99.00 1.00] 100.00 100.00]
77.773.260 Inversiones Copperfeld SpA Chile US$ 99.99 0.01 100.00 100.00]
76.043.396-9 Innovaciones en Cobre S.A. Chile US$ 0.05] 99.96] 100.00 100.00]
76.148,338-2 Sociedad de Procesamiento de Molíbdeno Ltda. Chile US$ 99.96 0.05 100.00 100.00]
76.173.357-5 Inversiones Gacrux SpA Chile US$ 100.00] a] 100.00 100.00]
76.231.838-5 Inversiones Mineras Nueva Acrux SpA Chile US$ a] 67.80 67.80 67.80
76.237.866-3 Inversiones Mineras Los Leones SpA Chile US$ 100.00] a] 100.00 100.00]
76.173.783-k Inversiones Mineras Becrux SpA Chile US$ a] 67.80 67.80 67.80
76.124.156-7 Centro de Especialidades Médicas San Lorenzo Ltda. Chile US$ a] 100.00 100.00 100.00]
76,255.061-K Cental Eléctica Luz Minera SpA Chile US$ 100.00] a] 100.00 100.00]
70.905.700-6 Fusat Chile CLP a] a] 0 a]
76.334.370-7 Isalud Isapre de Codelco Ltda. Chile CLP 59.26 40.73 99.99 a]
78.394.040-K Centro de Servicios Médicos Porvenir Ltda. Chile CLP a] 99.00] 99.00 99.00
77.928.390-9 Inmobiliaria e Inversiones Rio Cipreces Ltda Chile CLP a] 99.90] 99.90 99.90
77.270.020 Prestaciones de Servicios de la Salud Intersalud Ltda Chile CLP a] 99.00] 99.00 99.00
76.764.301-8 Salar de Maricunga SpA Chile CLP 100.00] dl 100.00 100.00]

On July 15, 2019, according to Bermuda Registration Certificate No. 28890, the merger between
Codelco Technologies and Codelco International is reported, the latter being the absorbing company
of Codelco Technologies, for which it acquires 9.99 % of subsidiary Codelco Brasil and 100% of
Ecometales.

21
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

On December 2, 2019, by public deed, the partners approved the merger by incorporation of the
Institución de Salud Previsional Chuquicamata Ltda., San Lorenzo Institución de Salud Previsional
Ltda., Institución de Salud Previsional Río Blanco Ltda., and Institución de Salud Previsional Fusat
Ltda., the latter being the absorbing Isapre (health insuring entity). In addition, the partners approved
modifications to the statutes related to a change in the company name, capital increase due to the
merger, contribution and participation of the partners in the share capital.

For the purposes of these consolidated financial statements, subsidiaries, associates, acquisitions
and disposals and joint ventures are defined as follows:

+ Subsidiaries – A subsidiary is an entity over which the Corporation has control. Control is
exercised if, and only if, the following conditions are met: the Corporation has i) power to direct
the relevant activities of the subsidiaries unilaterally; ii) exposure or rights to variable returns
from these entities; and ¡i¡) the ability to use its power to influence the amount of these returns.
The Corporation reassesses whether or not it controls a subsidiary if facts and circumstances
indicate that there are changes to one or more of the elements of control listed above.

The consolidated financial statements include all assets, liabilities, revenues, expenses and
cash flows of Codelco and its subsidiaries, after eliminating all inter-company balances and
transactions.

The value of the participation of non-controlling shareholders in equity, net income and
comprehensive income of subsidiaries are presented, respectively, in the headings “Non-
controlling interests” of the consolidated statement of financial position; “Net income attributable
to non-controlling interests”; and “Comprehensive income attributable to non-controlling
interests” in the statements of comprehensive income.

+. Associates – An associate is an entity over which Codelco has significant influence. Significant
influence is the power to participate in the financial and operating policy decisions of the
associate but is not control or joint control over those policies.

Codelco’s interest ownership in associates is recognized in the consolidated financial
statements under the equity method. Under this method, the initial investment is recognized at
cost and adjusted thereafter to recognize changes in Codelco’s share of the comprehensive
income of the associate, less any impairment losses or other changes to the investment in net
assets of the associate.

Appropriate adjustments to the Codelco’s share of the associate’s profit or loss after acquisition

are made in order to account for depreciation of the depreciable assets and related deferred tax
balances based on their fair values at the acquisition date.

22
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

+. Acquisitions and Disposals – The results of businesses acquired are incorporated in the
consolidated financial statements from the date when control is obtained; the results of
businesses sold during the period are included in the consolidated financial statements up to the
effective date of disposal. Gains or losses on disposal is the difference between the sale
proceeds (net of expenses) and the carrying amount of the net assets attributable to the
ownership interest that has been sold (and, where applicable, the associated cumulative
translation adjustment).
If control is lost over a subsidiary, the retained ownership interest in the investment will be
recognized at its fair value.

At the acquisition date of an investment in a subsidiary, associate or joint venture, any excess of
the cost of the investment (consideration transferred) plus the amount of the non-controlling
interest in the acquiree plus the fair value of any previously held equity interest in the acquiree,
where applicable, over Codelco’s share of the net fair value of the identifiable assets and
acquired liabilities is recognized as goodwill. Any excess of Codelco’s share of the net fair
value of the identifiable assets and acquired liabilities over the consideration transferred, after
reassessment, is recognized immediately in profit or loss in the period in which the investment is
acquired.

+. Joint Ventures – The entities that qualify as joint ventures are accounted for using the equity
method.

e) Foreign currency transactions and Reporting currency conversion- Transactions in currencies
other than the Corporation’s functional currency are recognized at the rates of exchange prevailing at
the dates of the transactions. At the end of each reporting period, foreign currency transactions
denominated in foreign currencies are converted at the rates prevailing at that date. Exchange
differences on such transactions are recognized in profit or loss in the period in which they arise and
are included in line item “Foreign exchange differences” in the consolidated statement of
comprehensive income.

At the end of each reporting period, assets and liabilities denominated in Unidades de Fomento (UF
or inflation index-linked units of account) are translated into U.S. dollars at the closing exchange rates
at that date (12/31/2019: US$37.81; 12/31/2018: US$39.68). The expenses and revenues in Chilean
pesos have been expressed in dollars at the observed exchange rate, corresponding to the date of
the accounting recording of each operation.

The financial statements of subsidiaries, associates and jointly controlled entities, whose functional
currency is other than the presentation currency of Codelco, are translated as follows for purposes of
consolidation:

+ Assets and liabilities are translated using the prevailing exchange rate on the closing date of the
financial statements.

+ Income and expenses for each statement of comprehensive income are translated at average
exchange rates for the period.

23
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

9)

+ All resulting exchange differences are recognized in other comprehensive income and
accumulated in equity under the heading “Reserve on exchange differences on translation.”

The exchange rates used in each reporting period were as follows:

. Closing exchange ratios
Relation
12/31/2019 12/31/2018
USD / CLP 0.00134 0.00144
USD / GBP 1.31320 1.27000
USD / BRL 0.24910 0.25848
USD/EURO 1.12133 1.14390
USD/AUD 0.70018
USD /HKD 0.12844

Offsetting balances and transactions – In general, assets and liabilities, income and expenses, are
not offset in the financial statements, unless required or permitted by an IFRS or when offsetting
reflects the substance of the transaction as well as when it is the intention of the Corporation to settle
a transaction net.

Income or expenses arising from transactions which, for contractual or legal reasons, permit the
possibility of offsetting and which the Corporation intends to liquidate for their net value or realize the
assets and settle the liabilities simultaneously, are stated net in the statement of comprehensive
income.

Property, plant and equipment and depreciation — ltems of property, plant and equipment are
initially recognized at cost. Subsequent to initial recognition, they are measured at cost, less any
accumulated depreciation and any accumulated impairment losses.

Extension, modernization or improvement costs that represent an increase in productivity, capacity or
efficiency, or an increase in the useful life of the assets are capitalized as increasing the cost of the
corresponding assets.

Furthermore, assets acquired under finance lease contracts are included in property, plant and
equipment.

The assets included in property, plant and equipment are depreciated, as a general rule, using the
units of production method, when the activity performed by the asset is directly attributable to the
mine production process. All other assets included in property, plant and equipment are depreciated
using the straight-line method.

The assets included in property, plant and equipment and certain intangibles (software) are
depreciated over their economic useful lives, as described below:

24
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Category Useful Life
Land Not depreciated
Land on mine site Units of production
Buildings Straight-line over 20-50 years
Buildings in underground mine levels Units of production level
Vehicles Straight-line over 3-7 years
Plant and equipment Units of production
Smelters Straight-line
Refineries Units of production
Mining rights Units of production
Support equipment Units of production
Intangibles – Software Straight-line over 8 years
Open pit and underground mine
development Units of production

Leased assets are depreciated over the lease term or their estimated useful life, whichever is shorter.

Estimated useful lives, residual values and depreciation method are reviewed at the end of each
reporting period, and any change in estimates is recognized prospectively.

Additionally, depreciation methods and estimated useful lives of assets, especially plants, facilities
and infrastructure may be revised at the end of each year or during the year according to changes in
the structure of reserves of the Corporation and productive long-term plans updated as of that date.

This review may be made at any time if the conditions of ore reserves change significantly as a result
of new known information, confirmed and officially released by the Corporation.

Gains or losses on the sale of disposal of an asset are calculated as the difference between the net
disposal proceeds received and the carrying amount of the asset, and are included in profit or loss
when the asset is derecognized.

Construction in progress includes the amounts invested in the construction of property, plant and
equipment and in mining development projects. Construction in progress is transferred to assets in
operation once the testing period has ended and when they are ready for use; at that point,
depreciation begins to be recognized.

Borrowing costs that are directly attributable to the acquisition or construction of assets that require a
substantial period of time before they are ready for use or sale are capitalized as part of the cost of
the corresponding items of property, plant and equipment.

The ore deposits owned by the Corporation are recorded in the accounting records at US$1.

25
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

h)

Notwithstanding the above, those reserves and resources acquired as part of acquisition of entities
accounted for as business combinations, are recognized at their fair value.

Intangible assets – The Corporation initially recognizes these assets at acquisition cost. Subsequent
to initial recognition, intangible assets are amortized in a systematic way over their economic useful
life, except for those assets with indefinite useful life, which are not amortized. Indefinitely-lived
intangible assets are tested for impairment at least annually, and whenever there ¡is an indication that
these assets may be impaired. Definitely-lived intangible assets are tested for impairment when an
indicator of impairment has been identified. At the end of each reporting period, these assets are
measured at their cost less any accumulated amortization (when applicable) and any accumulated
impairment losses.

The main intangible assets are described as follows:

Research and Technological Development and Innovation Expenditures: The expenditures for
the development of Technology and Innovation Projects are recognized as intangible assets at their
cost and are considered to have indefinite useful lives.
Development expenses for technology and innovation projects are recognized as intangible assets at
cost, if and only if, all of the following have been demonstrated:
e The technical feasibility of completing the intangible asset so that it will available for use or
sale;
The intention to complete the intangible asset is to use or sell it;
The ability to use or sell the intangible asset;
That the intangible asset will generate probable future economic benefits;
The availability of adequate technical, financial and other resources to complete the
development and to use or sell the intangible asset; and
e The ability to measure reliably the expenditure attributable to the intangible asset during its
development.

Research expenses for technology and innovation projects are recognized in profit or loss when
incurred.

Impairment of property, plant and equipment and intangible assets – The carrying amounts of
property, plant and equipment and intangible assets with finite useful lives are reviewed to determine
whether there is an indication that those assets have suffered an impairment loss. If any such
indicator exists, the Corporation estimates the asset’s recoverable amount to determine the extent of
the impairment loss which is then recorded.

For assets with indefinite useful lives, their recoverable amounts are annually estimated at the end of
each reporting period.

When an asset does not generate cash flows that are independent from other assets, Codelco
determines the recoverable amount of the CGU to which the asset belongs.

26
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The Corporation has defined each of its divisions as a cash generating unit.

Recoverable amount of an asset is the higher of fair value less costs of disposal and value in use. In
assessing value in use, the estimated future cash flows are discounted to their present value using a
pre-tax discount rate that reflects current market assessments of the time value of money and the
risks specific to the asset. On the other hand, the fair value less cost of disposal is usually
determined for operational assets considering the Life of Mine (“LOM”), based on a model of
discounted cash flows, while the assets not included in LOM as resources and potential resources to
exploit are measured by using a market model of multiples for comparable transactions.

If the recoverable amount of an asset or CGU is estimated to be less than its carrying amount, an
impairment loss is recognized immediately in profit or loss, reducing the carrying amount to its
recoverable amount. When an impairment loss subsequently reverses, the carrying amount of the
asset or CGU is increased to the revised estimate of its recoverable amount, but so that the
increased carrying amount does not exceed the carrying amount that would have been determined
had no impairment loss been recognized for the asset or CGU in prior years.

The estimates of future cash flow for a CGU are based on future production forecasts, future prices of
basic products and future production costs. Under lAS 36 “Impairment of Assets”, there are certain
restrictions for future cash flows estimates related to future restructurings and future cost efficiencies.
When calculating value in use, it is also necessary to base the calculations on the spot exchange rate
at the date of calculation.

Expenditures for exploration and evaluation of mineral resources, mine development and
mining operations – The Corporation has defined an accounting policy for each of these
expenditures.

Development expenses for deposits under exploitation whose purpose is to maintain production
levels are recognized in profit or loss when incurred.

Exploration and evaluation costs such as: drillings of deposits, including expenses necessary to
locate new mineralized areas and engineering studies to determine their potential for commercial
exploitation are recognized in profit or loss, normally at the pre-feasibility stage.

Pre-operating and mine development expenses (normally after feasibility engineering is reached)
incurred during the execution of a project and until its start-up are capitalized and amortized in
relation to the future production of the mine. These costs include stripping of waste material,
constructing the mine’s infrastructure and other works carried out prior to the production phase.

Finally, costs for defining of new areas or deposit areas in exploitation and of mining operations

(PP8E) are recognized in property, plant and equipment and are amortized through profit or loss
over the period during which the benefits are obtained.

27
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

k)

Stripping costs – Costs incurred in removing mine waste materials (overburden) in open pits that are

in production, that provide access to mineral deposits, are recognized in property, plant and

equipment, when the following criteria set out in IFRIC 20 Stripping Costs in the Production Phase of

a Surface Mine are met:

– — Itis probable that the future economic benefits associated with the stripping activity will flow to
the entity.

– Itis possible to identify the components of an ore body for which access has been improved as
a result of the stripping activity.

– The costs relating to that stripping activity can be measured reliably.

The amounts recognized in property, plant and equipment are depreciated according to the units of
production extracted from the ore body related to the specific stripping activity which generated this
amount.

Income taxes and deferred taxes – Codelco and ¡ts Chilean subsidiaries recognize annually income
taxes based on the net taxable income determined as per the standards established in the Income
Tax Law and Article 2 of D.L. 2398, as well as, the specific tax on mining referred to in Law 20026 of
2005. lts foreign subsidiaries recognize income taxes according to the tax regulations in each
country.

In addition, Codelco’s taxable income in each period is subject to the tax regime established in Article
26 of D.L. No. 1350, which states that tax payments will be made on March, June, September and
December of each year, based on a provisional tax calculation.

Deferred taxes on temporary differences and other events that generate differences between the
accounting and tax bases of assets and liabilities are recognized in accordance with lAS 12 “Income
taxes.”

Deferred taxes are also recognized for undistributed profits of subsidiaries, associates and joint
ventures, originated by withholding tax rates on remittances of dividends paid out by such companies
to the Corporation.

Inventories – Inventories are measured at cost, when such does not exceed net realizable value. Net
realizable value represents the estimated selling price for inventories less all estimated costs of
completion and costs necessary to make the sale (i,e,, marketing, sales and distribution expenses).
Costs of inventories are determined according to the following methods:

– Finished products and products in process: These inventories are measured at their average
production cost determined using the absorption costing method, including labor, depreciation of
fixed assets, amortization of intangibles and indirect costs of each period. Inventories of products in
process are classified in current and non-current, according to the normal cycle of operation.

28
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

– Materials in warehouse: These inventories are measured at their acquisition cost. The Corporation
estimates an allowance for obsolescence considering the turnover rate of slow-moving materials in
the warehouse.

– Materials in transit: These inventories are measured at cost incurred until the end of reporting
period. Any difference as a result of an estimate of net realizable value of the inventories lower than
its carrying amount is recognized in profit or loss.

Dividends – In accordance with Article 6 of D.L. 1350, the Corporation has a mandatory obligation to
distribute its net income as presented in the financial statements. The payment obligation is
recognized on an accrual basis.

Employee benefits – Codelco recognizes a provision for employee benefits when there is a present
obligation (legal or constructive) as a result of services rendered by its employees.

The employment contracts stipulate, subject to compliance with certain conditions, the payment of an
employee termination indemnity when an employment contract ends. In general, this corresponds to
one monthly salary per year of service and considers the components of the final remuneration which
are contractually defined as the basis for the indemnity. This employee benefit has been classified as
a defined benefit plan.

Codelco has also agreed to post-employment medical care benefits for certain retirees, which are
paid based on a fixed percentage applied to the monthly taxable salary of retirees covered by this
agreement. This employee benefit has been classified as a defined benefit plan.

These plans continue to be unfunded as of December 31, 2019.

The employee termination indemnity and the post-employment medical plan obligations are
determined using the projected unit credit method, with actuarial valuations being carried out at the
end of each reporting period. The defined benefit plan obligations recognized in the statement of
financial position represent the present value of the accrued obligations. Actuarial gains and losses
are recognized immediately in other comprehensive income and will not be reclassified to profit or
loss.

The Corporation’s management uses assumptions to determine the best estimate of these benefits.
The assumptions include an annual discount rate, expected increases in salaries and turnover rate,
among other factors.

In accordance with its operating optimization programs to reduce costs and increase labor
productivity by incorporating new current technologies and/or better management practices, the
Corporation has established employee retirement programs by amending certain employment
contracts or collective union agreements to include benefits encouraging employees to early retire.
Accordingly, these arrangements are accounted for as termination benefits and required accruals are
established based on the accrued obligation at current value. In case of employee retirement
programs which involve multi-year periods, the accrued obligations are updated using a discount rate
determined based on financial instruments denominated in the same currency and similar maturities
that will be used to pay the obligations.

29
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

p)

a)

Provisions for decommissioning and site restoration costs – The Corporation is obliged to incur
decommissioning and site restoration costs when such site restoration or decommissioning is
required due to a legal or constructive obligation. Costs are estimated on the basis of a formal
closure plan and cost estimates are annually reviewed.

A provision is recognized for decommissioning and site restoration costs. The amount of the
provision is the present value of the expenditures expected to be required to settle the obligation. The
provision is initially recognized with a corresponding increase in the carrying amount of the related
assets.

The provision for decommissioning and site restoration costs is accreted over time to reflect the
unwinding of the discount with the accretion expense included in finance costs in the statement of
income. The carrying amount of the related asset is depreciated over its useful life.

Changes in the measurement of the decommissioning and site restoration provision that result from
changes in the estimated timing or amount of the outflow of resources embodying economic benefits
required to settle the obligation, or a change in the discount rate, are added to, or deducted from, the
cost of the related assets in the period when changes occurred. The amount deducted from the cost
of the related assets cannot exceed its carrying amount. If a decrease in the liability exceeds the
carrying amount of the asset, the excess is recognized immediately in profit or loss.

If the adjustment results in an addition to the cost of an asset, the Corporation considers whether this
is an indication that the new carrying amount of the asset may not be fully recoverable. If such an
indicator exists, the Corporation tests the asset for impairment by estimating its recoverable amount,
and recognizes an impairment loss, if any.

The effects of the updating of the liability, due to the effect of the discount rate and / or passage of
time, is recorded as a financial expense.

Leases

Leases as of January 1, 2019 – Effective January 1, 2019, IFRS 16 Leases becomes effective, for
which the Corporation evaluates its contracts at initial application to determine whether they contain a
lease. The Corporation recognizes an asset for right of use and a corresponding liability for lease with
respect to all lease agreements in which Codelco is the lessee, except for short-term leases (defined
as a lease with a lease term of 12 months or less) and leases of low-value assets. For these leases,
the Corporation recognizes lease payments as an operating cost on a straight-line basis over the
term of the lease unless another systematic basis is more representative of the time pattern in which
the economic benefits of the leased assets are consumed.

The lease liability is initially measured at the present value of the lease payments that have not been

paid at the commencement date, discounted using the interest rate implicit in the lease. If this rate
cannot be easily determined, the Corporation uses the incremental borrowing rate.

30
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The incremental rate for loans used by Codelco is determined by estimating the interest rate that the
Corporation would have to pay for borrowing the necessary funds to obtain an asset of an equivalent
nature similar in value to the right-of-use asset of the respective lease, in a similar economic
environment over a similar term.

Lease payments included in the measurement of the lease liability mainly include fixed payments,
variable payments that depend on an index or a rate and the exercise price of a purchase option.
Variable payments that do not depend on an index or a rate are excluded.

The lease liability is subsequently measured as follows: the carrying amount increased to reflect the
interest on the lease liability (using the effective rate method) and the carrying amount is reduced to
reflect the lease payments made.

The Corporation revalues the lease liability as to the discount rate (and makes the corresponding
adjustments to the asset for respective right of use) when:

– There is a change in the term of the lease or;
– There is a change in the assessment of an option to purchase the underlying asset or;
– There is a change in an index or rate which generates a change in cash flows.

The right-of-use assets include the amount of the initial measurement of the lease liability, the lease
payments made before or until the start date less the lease incentives received and any initial direct
costs incurred. The assets for right to use are subsequently measured at cost less accumulated
depreciation and accumulated losses due to impairment.

When the Corporation incurs a cost obligation to dismantle or remove a leased asset, restore the
location in which it is located or restore the underlying asset to the condition required by the terms
and conditions of the lease, a provision is recognized and measured in accordance with lAS 37.
Costs are included in the corresponding asset for right of use, unless those costs are incurred to
produce inventories.

The right-of-use assets are depreciated during the shorter period between the term of the lease and
the useful life of the underlying asset. If a lease transfers the ownership of the underlying asset or the
cost of the asset for right of use reflects that the Corporation expects to exercise its option to
purchase, the right-of-use asset is depreciated over the useful life of the underlying asset.
Depreciation is made from the start date of the lease.

The assets for right of use and the lease liability are presented under “Property, plant and equipment”
and “Other financial liabilities”, respectively, in the consolidated statement of financial position.

31
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Leases until December 31, 2018- Leases are classified as finance leases whenever the terms of the
lease transfer substantially all the risks and rewards of ownership to the Corporation. All other leases
are classified as operating leases. Operating lease costs are recognized as an expense on a straight-
line basis over the lease term.

Assets held under finance leases are initially recognized as assets at the inception of the lease at
either their fair value or the present value of the minimum lease payments (discounted at the interest
rate implicit in the lease), whichever is lower. Lease payments are apportioned between finance costs
and reduction of the lease obligation so as to achieve a constant rate of return on the remaining
balance of the liability. Lease obligations are included in other current or non-current liabilities, as
appropriate.

In accordance with IFRIC 4 “Determining whether an Arrangement contains a Lease”, an
arrangement is, or contains a lease if fulfilment of the arrangement is dependent on the use of a
specific asset or assets and if the arrangement conveys the right to use the asset, even if that right is
not explicitly specified.

Revenue from Contracts with Customers – Revenue is recognized in an amount that reflects the
consideration to which the entity expects to be entitled in exchange for transferring goods or services
to customers.

– Sale of mineral goods and / or by-products: Contracts with customers for the sale of mineral
goods and / or by-products include the performance obligation for the delivery of the physical
goods and the associated transportation service, at the place agreed with the customers. The
Corporation recognizes revenue from the sale of goods when the performance obligation is
satisfied according to the shipment or dispatch of the products, in accordance with the agreed
conditions, such revenue being subject to variations related to the content and / or sale price at
the date of its liquidation. Notwithstanding the foregoing, there are some contracts where the
performance obligation is satisfied when there is receipt of the product (FOB ship point) instead
of the buyer’s corresponding destination, thus recognizing revenue at the time of said transfer.
When services of transport of goods are provided, the Corporation recognizes revenue when the
service obligation is satisfied.

Sales that have discounts associated with volume subject to compliance with goals are
recognized net, estimating the probability that the volume target will be reached.

Sales contracts include a provisional price at the shipment date. The final price is generally
based on the London Metals Exchange (“LME”) price. Revenue from sales of copper is
measured using estimates of the future spread of metal prices on the LME and/or the spot price
at the date of shipment, with subsequent adjustments made upon final pricing recognized as
revenue. The terms of sales contracts with customers contain provisional pricing arrangements
whereby the selling price for metal concentrate is based on prevailing spot prices on a specified
future date after shipment to the customer (the “quotation period”). Consequently, the final price
is set at the dates indicated in the contracts. Adjustments to provisional sale prices occur based

32
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

on movements in quoted market prices on the LME up to the date of final pricing. The period
between provisional invoicing and final pricing is typically between one and nine months.
Changes in fair value over the quotation period and until final pricing are estimated by reference
to forward market prices for applicable metals.

In terms of hedge accounting established by IFRS 9, the Corporation has opted to continue
applying the hedge accounting requirements of lAS 39 instead of the requirements of the new
standard. Therefore, there were no generated effects either at the level of account balances or at
the level of disclosures.

Sales in the Chilean market are recognized in conformity with the regulations that govern
domestic sales as indicated in Articles 7, 8 and 9 of Law No. 16624, modified by Article 15 of
Decree Law No. 1349 of 1976, on the determination of sales prices for the internal market which
does not differ from IFRS 15.

As indicated in the note related to hedging policies in the market of metal derivatives, the
Corporation enters into operations in the market of metal derivatives. Gains and losses from
those which are fair value hedges contracts are recognized as revenues.

– — Rendering of services: Additionally, the Corporation recognizes revenue for rendering services,
which are mainly related to the processing of minerals bought from third parties. Revenue from
rendering of services is recognized when the amounts can be measured reliably and when the
services have been provided.

s) Derivative contracts – Codelco uses derivative financial instruments to reduce the risk of fluctuations
in sales prices of its products and of exchange rates.

Derivatives are initially recognized at fair value at the date the derivative contracts are entered into
and are subsequently measured to their fair value at the end of each reporting period.

The effective portion of changes in the fair value of derivatives that are designated and qualify as
cash flow hedges is recognized in other comprehensive income and accumulated in equity under the
item “Cash flow hedge reserve.” The gain or loss relating to the ineffective portion is immediately
recognized in profit or loss, and included in the “Finance cost” or “Finance income” line items.
Amounts previously recognized in other comprehensive income and accumulated in equity are
reclassified to profit or loss in the periods when the hedged item affects profit or loss, in the same line
as the effect for the fluctuation in the recognized hedged item.

A hedge relationship is considered highly effective when changes in fair value or in cash flows of the
underlying item directly attributable to the hedged risk are offset by changes in fair value or cash
flows of the hedging instrument, with an effectiveness ranging from 80% to 125%. Changes in fair
value accumulated in other comprehensive income are subsequently reclassified from equity to profit
or loss in the same period or periods during which the hedged item affects profit or loss. Upon
discontinuation of hedge accounting and depending on the circumstances, the cumulative gain or
loss on the hedging instrument remains in equity until the hedged transaction occurs or, if the hedged

33
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

transaction is not expected to occur, the amount accumulated in other comprehensive income ¡is
reclassified to profit or loss.

The total fair value of hedging derivatives is classified as “non-current financial asset or liability”, if the
remaining maturity of the hedged item is greater than 12 months, and as “current financial asset or
liability”, if the remaining maturity of the hedged item ¡is less than 12 months.

The derivative contracts held by the Corporation have been entered into to apply the risk hedging

policies and are accounted for as indicated below:

– — Hedging policies for exchange rate risk: The Corporation enters into exchange rate derivatives
to hedge exchange rate variations between the U.S. dollar and the currencies of transactions the
Corporation undertakes. In accordance with the policies established by the Board of Directors,
these hedge transactions are only entered into when there are recognized assets or liabilities,
forecasts of highly probable transactions or firm commitments. The Corporation does not enter
into derivative transactions for non-hedging purposes.

– — Hedging policies for metal market prices risk: In accordance with the policies established by
the Board of Directors, the Corporation entered into derivative contracts to reduce the inherent
risks in the fluctuations of metal prices.

The hedging policies seek to cover expected cash flows from the sale of products by fixing the
sale prices for a portion of future production. When the sales agreements are fulfilled and the
derivative contracts are settled, the results from sales and derivative transactions are offset in
profit or loss in revenue.

Hedging transactions carried out by the Corporation in the metal derivatives market are not
undertaken for speculative purposes.

– Embedded derivatives: The Corporation has established a procedure that allows for evaluation
of the existence of embedded derivatives in financial and non-financial contracts. Where there is
an embedded derivative, and the host contract is not a financial instrument and the characteristics
and risks of the embedded derivative are not closely related to the host contract, the derivative is
required to be recognized separately.

t) Financial information by segment – The Corporation has defined ¡ts Divisions as its operating
segments in accordance with the requirements of IFRS 8, Operating Segments. The mining deposits
in operation, where the Corporation conducts its extractive and processing activities are managed by
the following Divisions: Chuquicamata, Radomiro Tomic, Ministro Hales, Gabriela Mistral, Salvador,
Andina and El Teniente, In addition, the smelting and refining activities are managed at the Ventanas
Division. All these Divisions have a separate operational management, which reports to the Chief
Executive Officer, through the North and South Central Vice-President of Operations, respectively.
Income and expenses of the Head Office are allocated to the defined operating segments.

34
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

u) Presentation of Financial Statements – The Corporation presents (i) its statements of financial
position classified as “current and non-current”, (ii) profit or loss or loss and other comprehensive
income in one statement and the classification of expenses within profit or loss by function, and (iii)

its statement of cash flows using the direct method.

v) Current and non-current financial assets – The Corporation determines the classification of its
financial assets at the time of initial recognition. The classification depends on the business model in

which the investments are managed and the contractual characteristics of their cash flows.

The Corporation’s financial assets are classified into the following categories:

Fair value through profit or loss:

Initial recognition: This category includes those financial assets not qualifying under the categories
of Fair Value through Other Comprehensive Income or Amortized Cost. These instruments are
initially recognized at fair value.

Subsequent recognition: Their subsequent recognition is at fair value, recording in the
consolidated statement of comprehensive income, in the line “Other gains (losses)” any changes
in fair value.

Amortized cost:

Initial recognition: This category includes those instruments with respect to which the objective of
the business model of the Corporation is to hold the financial instrument to collect contractual
cash flows and such cash flows consist of solely payments of principal and interest. This category
includes certain Trade and other current receivables, and the loans included in other non-current
financial assets.

Subsequent recognition: These instruments are subsequently measured at amortized cost using
the effective interest method. The amortized cost of a financial asset is the amount at which the
financial asset is measured at initial recognition minus the principal repayments, plus the
cumulative amortization using the effective interest method of any difference between that initial
amount and the maturity amount, adjusted for any impairment allowance.

Interest income is recognized in profit or loss and is calculated by applying the effective interest
rate to the gross carrying amount of a financial asset. For financial assets measured at amortized
cost that are not part of a designated hedging relationship, exchange differences are recognized
in profit or loss in the “Foreign exchange difference” line item.

35
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

– Atfair value through other comprehensive income:

Initial measurement: Financial assets that meet the criteria “Solely payments of principal and
interest” (SPPI) are classified in this category and must be maintained within a business model
both to collect the cash flows and to sell the financial assets. These instruments are initially
recognized at fair value.

Subsequent recognition: Their subsequent valuation is at fair value. Interest income calculated
using the effective interest rate method, foreign exchange gains and losses and impairment are
recognized in income. Other net gains and losses are recognized in other comprehensive income.
On derecognition, the gains and losses accumulated in other comprehensive income for debt
instruments are reclassified to income.

Codelco did not irrevocably choose to designate any of its investment assets at fair value with
effect on other comprehensive income.

w) Financial liabilities – Financial liabilities are initially recognized at fair value net of transaction costs.
Subsequent to their initial recognition, the valuation of the financial liabilities will depend on their
classification, within which the following categories are distinguished:

– — Financial liabilities at fair value through profit or loss: This category includes financial
liabilities defined as held for trading.

Changes in fair value associated with own credit risk are recorded in other comprehensive
income unless doing so creates an accounting mismatch.

– — Financial liabilities at amortized cost: This category includes all financial liabilities other
than those measured at fair value through profit or loss.

The Corporation includes in this category bonds, obligations and other current payables.

These financial liabilities are measured using the effective interest rate method, recognizing
interest expense based on the effective rate.

The effective interest rate method is a method of calculating the amortized cost of a financial
liability and of allocating interest expense over the relevant period. The effective interest rate
is the rate that exactly discounts estimated future cash payments through the expected life of
the financial liability, or where appropriate, a shorter period, to the net carrying amount on
initial recognition.

Trade and other current payables are financial liabilities that do not explicitly accrue interest
and are recognized at their nominal value, which approximates its fair value.

Financial liabilities are derecognized when the liabilities are paid or expire.

36
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

x)

y)

Impairment of financial assets – The Corporation measures the loss allowance at an amount equal
to lifetime expected credit losses for certain of its trade receivables. For these, it uses the simplified
approach as required under IFRS 9. The Corporation considers a trade receivable to be in default at
90 days.

The provision matrix is based on an entity’s historical credit loss experience over the expected life of
such trade receivables and is adjusted for forward-looking estimates taking into account the most
relevant macroeconomic factors that affect bad debts.

Other accounts receivable and other financial assets are reviewed using reasonable and sustainable
information that is available without cost or disproportionate effort in accordance with IFRS 9 to
determine the credit risk of the respective financial assets. A provision is established for impairment
losses in trade accounts receivable and other financial assets, when there is objective evidence that
those amounts owed cannot be fully recovered.

Cash and cash equivalents and statement of cash flows prepared using the direct method –
The statement of cash flows reflects changes in cash and cash equivalents that took place during the
period, determined under the direct method. For the purposes of preparing the statement of cash
flows, the Corporation has defined the following:

– Cash flows: inflows and outflows of cash or cash equivalents, which are defined as highly liquid
investments maturing in less than three months with a low risk of changes in value.

– — Operating activities are the principal revenue-producing activities of the Corporation and other
activities that are not investing or financing activities.

– Investing activities are the acquisition and disposal of long-term assets and other investments
not included in cash equivalents.

– — Financing activities are activities that result in changes in the size and composition of net
equity and borrowings of the Corporation.

Bank overdrafts are classified as external resources in current liabilities.

Law No. 13196 – Law No. 13196 requires the payment of a 10% special export tax on receivables of
the sales proceeds that Codelco receives and transfers to Chile from the export of copper and related
by-products produced by Codelco. The Chilean Central Bank deducts 10% of the amounts that
Codelco transferred to its Chilean bank account. The amount recognized for this concept is
presented in the statement of income within the line item “Other expenses.”

On January 27, 2017, Law No. 20989, article 3, establishes changes in the application of Law No.

13196 as of January 1, 2018, through which the Corporation will deposit annually, no later than
December 15 of each year, the funds established in article 1 in that law.

37
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

aa)

ab)

ac)

ad)

On September 26, 2019, Law No. 21,174 was published, which repeals Law No. 13,196 and
establishes that the 10% tax to the tax benefit provided by the Corporation will subsist for a period of
nine years, decreasing from the tenth year 2.5% per year until reaching 0% in the twelfth year. The
validity of this law is as of January 1, 2020.

Cost of sales – Cost of sales is determined according to the absorption costing method, including the
direct and indirect costs, depreciation, amortization and any other expenses directly attributable to
the production process.

Environment – The Corporation adheres to the principles of sustainable development, which foster
the economic development while safekeeping the environment and the health and safety of its
collaborators. The Corporation recognizes that these principles are central for the well-being of its
collaborators, care for the environment and success in its operations.

Classification of current and non-current balances – In the consolidated statement of financial
position, the balances are classified according to their maturities, that is, as current for those with a
maturity equal to or less than twelve months and as non-current for those with a greater maturity.
Where there are obligations whose maturity is less than twelve months, but whose long-term
refinancing is insured upon a decision by the Corporation whose intention is to refinance, through
credit agreements available unconditionally with long-term maturity, these could be classified as non-
current liabilities.

Non-current assets or groups of assets for disposition classified as held for sale: The
Corporation classifies as non-current assets or groups of assets for disposal, classified as held for
sale, properties, plants and equipment, investments in associates and groups subject to expropriation
(group of assets that are going to be disposed of together with their directly related liabilities), for
which, at the closing date of the financial statements, their sale has been committed to or steps have
been initiated and it is estimated that it will be carried out within the twelve months following said
date. These assets or groups subject to disposal are valued at book value or the estimated sale value
minus the costs necessary for sale, whichever is less, and are no longer amortized from the moment
they are classified as non-current assets held for sale. Non-current assets or groups of assets for
disposal classified as held for sale and the components of the groups subject to disposal classified as
held for sale are presented in the consolidated statement of financial position on a line for each of the
following concepts: “Non-current assets or groups of assets for disposition classified as held for sale”
and/or “Non-current liabilities or groups of liabilities for disposition classified as held for sale.”

New standards and interpretations adopted by the Corporation

The accounting policies adopted in the preparation of the consolidated financial statements are consistent
with those applied in the preparation of the Corporation’s annual consolidated financial statements for the
year ended December 31, 2018, except for the adoption of new standards, interpretations and
amendments, effective from January 1, 2019, which are:

38
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

a) IFRS 16, Lease:
In the current period, the Corporation has applied IFRS 16 Leases for the first time.

IFRS 16 introduces new or modified requirements with respect to the accounting for leases. lt introduces
significant changes to lease accounting for lessees by removing the distinction between operating and
financial leases; requires the recognition, at the outset, of an asset for right to use and a lease liability for
all leases, allowing exemptions for short-term leases and leases of low-value assets. In contrast to the
accounting for the lessee, the requirements for the accounting of the lessor remain largely unchanged.
Details of these new requirements are described in Chapter Il, note 2, letter q Leases. The impact of the
adoption of IFRS 16 in the consolidated financial statements of the Corporation is described below.

The initial application date of IFRS 16 for the Corporation is January 1, 2019.

The Corporation has applied IFRS 16 with the cumulative effect of the initial application of the standard
recognized as of January 1, 2019. Consequently, it has not restated the comparative financial information.

Impact of the new definition of a lease

The change in the definition of a lease is mainly related to the concept of control. IFRS 16 determines
whether a contract contains a lease on the basis of whether the client has the right to control the use of an
identified asset for a period of time in exchange for consideration.

Impact on the accounting of leases

Operating Leases – IFRS 16 changes with respect to how the Corporation accounts for leases previously
classified as operating leases under IAS 17, which, with this change, are recognized in the assets and
liabilities of the statement of financial position.

The Corporation has re-evaluated all of its contracts at the date of initial application. As a result of the
foregoing, leases have been re-assessed in accordance with the new requirements of IFRS 16.

Transition rules

As of the transition date of January 1, 2019, the Corporation recognizes its leases with the accumulated
effect on the date of initial application, opting to recognize a right to use asset equal to the lease liability.

Practical expedients applied in the transition to operating leases
– Discount rate applied to a lease portfolio;
– — Short-term lease exemption for those contracts whose term ¡is less than twelve months;
– — Exemption for leases of low-value;
– Review of lease contracts at transition under the “onerous contract” provisions of lAS 37 rather
than undertaking an impairment review under lAS 36;
– — Measurement of right-of-use assets at lease liability amount at date of initial application;

39
CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Impact on assets, liabilities and equity as of January 1, 2019

. . Balances

Balances prior Adjustment diusted b:
to IFRS 16 IFRS 16 2 1ERS 16 y

ThUs$ ThUS$
ThUS$

Property, plant and equipment (1) 26,754,998 373,889 27,128,887
Total Assets 37,090,805 373,889 37,464,694
Other current financial liabilities 872,277 96,404 968,681
Other non-current financial liabilities 14,674,510 277,485 14,951,995
Total Liabilities 25,746,936 373,889 26,120,825
Net Effect 11,343,869 11,343,869

Reconciliation of operating leases under lAS 17 disclosed as of December 31, 2018 and lease

liabilities recognized as of January 1, 2019

Reconciliation of operating leases

Operating lease commitments as of December 31, 2018, as disclosed in the consolidated
financial statements in accordance with |AS17.
Less initial recognition exceptions:

Short-term leases

Leases with variable payments that do not depend on an index or a rate

Low-value leases

Total lease liabilities (undiscounted) recognized as of January 1, 2019

Plus:
Leases identified in existing contracts as of January 1, 2019 under IFRS 16 (1)

January 1, 2019

Discounted using the incremental borrowing rate at the date of the initial application (January 1,

2019)

Discounted financing lease liabilities recognized as of January 1, 2019
Lease liabiliies related to leases previously classified as financial leases
Total lease liabilities recognized on January 1, 2019

Consisting of:

Lease liabiliies current portion

Lease liabiliies non-current portion

Total lease liabilities recognized on January 1, 2019

(1) The Corporation has re-evaluated all of its contracts at the date of initial application, including those

ThUS $
266,351

(55,360)
(69,070)
(220)

141,701

421,608
3.81%

373,889
107,839
481,728

117,914
363,814
481,728

that under lAS 17 and IFRIC 4, had not been identified as leases. As a result of the foregoing, leases

have been included in accordance with the new requirements of IFRS 16.

40
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

b) IFRIC 23 Uncertainty about treatment of income tax

IFRIC 23 establishes how to determine a tax position when there is uncertainty about the treatment for
income tax. For this determination, the steps are as follows:

i. determine if uncertain tax positions should be evaluated separately or as a whole;
li. evaluate if the tax authority is likely to accept an uncertain tax treatment used, or proposed to be
used, by an entity in its tax returns:
– Ifacceptable, the entity must determine its accounting tax position in a manner consistent with the tax
treatment used or planned to be used in ¡ts tax return.
– Ifuncertain, the entity must reflect the effect of uncertainty in the determination of its accounting tax
position.

The Corporation has determined that it has no significant uncertain tax positions.

The application of IFRIC 23 has not materially affected the consolidated financial statements of
Codelco.

c) Amendments to IFRS 9, Features of prepayment with negative compensation

The amendments to IFRS 9 clarify that for purposes of evaluating whether a prepaid feature meets the
condition of cash flows that are only principal and interest payments (SPPI), the party exercising the
option could pay or receive reasonable compensation for the prepayment regardless of the reason for
the prepayment. The application of these amendments had no impact on the consolidated financial
statements of the Corporation, however it could affect the accounting of future transactions or
agreements.

d) Amendmenkts to IAS 28, Long-term investments in associates and joint ventures

The amendments clarify that when applying IFRS 9 to long-term investments, an entity does not take
into account the adjustments to its carrying amounts required by lAS 28. The application of these
amendments had no impact on the consolidated financial statements of the Corporation, however, it
could affect the accounting of future transactions or agreements.

e) Amendments to IAS 19, Employee Benefits Plan Amendment, Curtailment or Settlement

The amendmenkts clarify that the past service cost (or of the gain or loss on settlement) is calculated by
measuring the defined benefit liability (asset) using updated assumptions and comparing benefits
offered and plan assets before and after the plan amendment (or curtailment or settlement) but
ignoring the effect of the asset ceiling (that may arise when the defined benefit plan is in a surplus
position). IAS 19 is now clear that the change in the effect of the asset ceiling that may result from the
plan amendment (or curtailment or settlement) is determined in a second step and is recognized in the
normal manner in other comprehensive income. The amendments to lAS 19 require the use of
updated actuarial assumptions to remeasure the service cost and the net interest for the remainder of
the reporting period after the change to the plan. The application of these amendments had no impact
on the consolidated financial statements of the Corporation, however it could affect the accounting of
future transactions or agreements.

41
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

f) Annual improvements cycle 2015 – 2017 (amendments to IFRS 3, IFRS 11, IAS 12 and lAS 23)
– Amendments to IFRS 3 and IFRS 11: Adds paragraphs on treatment for acquisitions in
participations previously held in a joint operation.
– Amendments to lAS 12: Add paragraph on treatment of taxes related to dividends payable.
– Amendments to lAS 23: Modify wording on application of the capitalization rate.
The application of these amendments had no impact on the consolidated financial statements of the
Corporation, however it could affect the accounting of future transactions or agreements.
New accounting pronouncements
a) The following new IFRS, amendments and interpretations had been issued by the lASB, but their
application is not yet mandatory:

New IFRS Date of mandatory application Summary
Establishes the principles for the
IFRS 17, Insurance Contracts Annual periods beginning on or after | recognition, measurement,
January 1, 2021 presentation and disclosure of
insurance contracts, reinsurance

contracts and investment contracts
with discretional participating features
and supersedes IFRS 4 Insurance
contracts.

Amendments to IFRS

Date of mandatory application

Summary

Amendment to IFRS 10 and IAS
28: Sale or Contribution of
Assets

Date to be determined by lASB.

Recognizes the profits or losses of
sales of assets between an investor
and an associate or a joint venture,
which are recognized for the total
when the transaction involves assets
which constitute a business and are
recognized partially when the assets
do not constitute a business.

Definition of a Business
(Amendments to IFRS 3)

Annual reporting periods beginning on
or after January 1, 2020

Clarifies that to be considered a
business, an acquired set of activities
and assets must include, at a
minimum, an input and a substantive
process that together significantly
contribute to the ability to create
outputs

Definition of Material
(Amendments to IAS 1 and lAS
8)

Annual reporting periods beginning on
or after January 1, 2020

Clarifies the definition of ‘material”
and aligns the definition used in the
Conceptual Framework and the
standards.

42

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Modifications Conceptual
Framework for the Report
Revised Financial

Annual periods initiated on or after the
January 1, 2020

It incorporates some new concepts,
provides updated definitions and
recognition criteria for assets and
liabilities. This modification
accompanies a separate document,
“Modifications to the References to
Conceptual Framework in the Rules
IFRS , which establishes
amendments to other IFRS in order to
update the references to the new
Conceptual Framework

Interest Rate Benchmark Reform
(Amendments to IFRS 9, IAS 39
and IFRS 7)

Annual reporting periods beginning on
or after 1 January 2020

The amendments in Interest Rate
Benchmark Reform (Amendments to
IFRS 9, IAS 39 and IFRS 7) clarify
that entities would continue to apply
certain hedge accounting
requirements assuming that the
interest rate benchmark on which the
hedged cash flows and cash flows
from the hedging instrument are
based will not be altered as a result of
interest rate benchmark reform.

The Administration does not expect significant impacts with respect to standards, amendments and

interpretations indicated above.

EXPLANATORY NOTES

Cash and cash equivalents

The detail of cash and cash equivalents as of December 31, 2019 and 2018, is as follows:

ltem 12/31/2019 | 12/31/2018
TRUS$ ThHUS$

Cash on hand 49,017 25,033
Bank balances 213,580 59,030
Time deposits 972,125 | 1,131,049
Mutual Funds – Money Market 2,158 1,698
Repurchase agreements 66,225 12,315
Total cash and cash equivalents 1,303,105 1,229,125

Interest on time deposits is recognized on an accrual basis using the contractual interest rate of each of

these instruments.

The Corporation does not hold any significant amounts of cash and cash equivalents that have a

restriction on use.

Cash and cash equivalents meet the low credit risk exemption under IFRS 9.

43
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

2. Trade and other receivables
a) Accruals for open sales invoices

As mentioned in the Summary of Significant Accounting Policies Section, the Corporation adjusts ¡ts
revenues and trade receivable balances, based on future copper prices through the recognition of an
accrual for open sales invoices.

When future price of copper is lower than the provisional invoicing price, the accrual is presented in
the statement of financial position as follows:

– For those customers that have due balances with the Corporation the accrual is presented as a
deduction from the line item trade and other current receivables.

– For those customers that do not have due balances with the Corporation the accrual is presented
in the line item trade and other current payables.

When the future copper price is higher than the provisional invoicing price, the accrual is added to the
line item trade and other current receivables.

According to the foregoing, as of December 31, 2019 and for provisions for unfinalized sales
invoices, a positive amount of ThUS$98,045 is presented intrade and other current receivables for
open invoices related to customers with no outstanding amounts to Codelco.

As of December 31, 2018, a negative amount is presented in the trade and other current receivable
of ThUS$96,396 and a provision of ThUS$5,025 in the trade accounts payable item of current
liabilities, the latter associated with customers that do not present balances owed to Codelco; totaling
a negative effect of ThUS$101,421 for open invoices related to customers..

b) Trade and other receivables

The following table sets forth trade and other receivables balances, with their corresponding
allowances for doubtful accounts:

Current Non-Current
Items 12/31/2019 12/31/2018 12/31/2019 12/31/2018
LES THUS$ THUS$ LES

Trade receivables (1) 1,934,245 1,542,420 438 820
Allowance for doubtful accounts (3) (7,530) (37,811) – –
Subtotal trade receivables, net 1,926,715 1,504,609 438 820
Other receivables (2) 668,218 712,446 98,106 83,911
Allowance for doubtful accounts (3) (6,665) (4,846) – –
Subtotal other receivables, net 661,553 707,600 98,106 83,911
Total 2,588,268 2,212,209 98,544 84,731

44
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

(1) Trade receivables correspond to the sales of copper and its by-products, those that in general
are sold in cash or through banks transfers.

(2) Other receivables mainly consist of the following items:

+ Corporation’s employee short-term loans and mortgage loans, both monthly deducted from
the employee’s salaries. Mortgage loans granted to the Corporation’s employees for
ThUS$48,809 are secured with collateral.

+ Reimbursement receivables from insurance companies.

+ Advance payments to suppliers and contractors.

+ Accounts receivable for tolling services (Ventanas Smelter).

+ VAT credit and other refundable taxes of ThUS$179,486 and ThUS$201,274 as of
December 31, 2019 and 2018, respectively.

(3) The Corporation recognizes an allowance for doubtful accounts based on its expected credit
loss model.

The reconciliation of changes in the allowance for doubtful accounts for the year ended December
31, 2019 and 2018, were as follows:

12/31/2019 12/31/2018
Items
TRUS$ TRUS$

Opening balance 42,657 40,100
Net Increases 1,709 7,215
Write-ofis/applications (30,171) (4,658)
Total movements (28,462) 2,557
Closing balance 14,195 42,657

As of December 31, 2019 and 2018, the balance of past due but not impaired trade receivables, is as
follows:

. 12/31/2019 12/31/2018
Maturity
ThUS$ ThUS$
Less than 90 days 9,510 3,473
Between 90 days and 1 year 1,211 4,789
More than 1 year 9,530 10,266
Total trade receivables past-due but not impaired 20,251 18,528

45
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

3. Balance and transactions with related parties
a) Transactions with related persons

In accordance with Law on New Corporate Governance, the members of Codelco’s Board are, in
terms of transactions with related persons, subject to the provisions of Title XVI of Law on
Corporations, which sets the requirements regarding transactions with related parties in publicly
traded companies and their subsidiaries.

Notwithstanding the foregoing, pursuant to the provisions of the final paragraph of Article 147 b) of
Title XVI, which contains exceptions to the approval process for transactions with related parties, the
Corporation has established a general policy over customary transactions (which were
communicated through a significant event notice to the CMF), that defines customary transactions as
those carried out with its related parties in the normal course of business, which contributes to the
social interest and are necessary to the normal development of Codelco’s activities.

Likewise, consistent with the legal framework, the Corporation maintains within its internal framework
a specific policy about transactions between related persons and companies with Codelco’s
employees. Codelco’s Corporate Policy No.18 (“CCP No. 18”), the latest version currently in force,
was approved by the Chief Executive Officer and the Board of Directors.

Accordingly, Codelco without the authorization required in CCP No. 18 and of the Board of Directors,
when required by Law or by the Corporation by-laws, shall not enter into any contracts or agreements
involving one or more Directors, its Chief Executive Officer, the members of Division’s Managing
Committees, Vice-presidents, Legal Counsel, General Auditor, Division Chief Executive Officers,
Advisors of Senior Management, employees who must make recommendations and/or have the
authority to award tenders, assignments of purchases and/or contracting goods and services, and
employees in management positions (up to fourth hierarchical level in the organization), including
their spouses, children and other relatives up to second degree of relation, with a direct interest,
represented by third parties or on behalf of another person. Likewise, CCP No. 18 requires
administrators of Corporation’s contracts to declare all related persons, and disqualify himself/herself
¡Fany related persons are involved within the field of his/her job responsibilities.

This prohibition also includes the companies in which such administrators are involved through
ownership or management, either directly or through representation of other natural persons or legal
entities, as well as those individuals who also have ownership or management in those companies.

The Board of Directors has been informed and approved certain transactions as defined in CCP No.
18.

The most significant transactions with related persons and the amounts involved are detailed in the
following table:

46
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

11112019 1/1/2018
. Taxpayer o Description of the 12/31/2019 12/31/2018
Entity Country | Nature of the relationship .
number transaction Amount Amount
ThUS$ ThUS$

Administración de Sistemas y Services Herman 76.349.138-2 | Chile |Employee’s relative Services – 200
Yerko Valenzuela Rojas E.LR.L

Anglo American Sur S.A. 77.762.940-9 | Chile [Associate Supplies 16 55
Arcadis Chile S.A. 89.371.200-3 | Chile [Employee’s relative Services – 3,511
Asociación Chilena de Seguridad 70.360.100-6 | Chile | Member of Board of directors Services – 852
B.Bosch S.A 84.716.400K | Chile. [Employee’s relative Supplies 5,071 –
Centro de Capacitación y Recreación Radomiro Tomi, 75.985.550-7 | Chile [Other related Services 62 847
Codelco Tec SpA 96.991.180-9 | Chile |Subsidiary Services – 10,000
Ecometales Limited agencia en Chile 59.087.580-9 | Chile |Subsidiary Services 43,495 20,040
Exploraciones Mineras Andinas S.A. 99.569.520-0 | Chile |Subsidiary Services – 358,130
Fismidih S.A 89.564.200-6 | Chile [Employee’s relative Supplies 5812 –
Fundacion Educacional de Chuquicamata 72.747.300-9 | Chile |Founder member donor Services 134 –
Fundación Orquesta Sinfónica Infantil de los Andes. | 65.018.784-9 | Chile. |Founder member donor Services 270 297
Glasstech S.A, 87.949.500-8 | Chile [Employee’s relative Supplies – 3
Highservice ingeniería y construcción ltda. 76.378.396-0 | Chile |[Employee’s relative Services 11,803 –
Industrial Support Company Ltda 77.276.280-1 | Chile [Employee’s relative Services 76,389 –
Industrial y Comercial Arimatemb Ltda. 76.108.720-7 | Chile [Employee’s relative Services 20 2
Inoxa SA. 99.513.620-1. | Chile [Employee’s relative Services – 468
Instítución de Salud Previsional Chuquicamata Ltda. | 79.566.720-2 | Chile |Subsidiary Services 3,257 2
Insttución de Salud Previsional Río Blanco Ltda. 89.441.300 | Chile |Subsidiary Services – 47,028
Kairos Mining S.A. 76.781.030 | Chile. [Other related Services – 13,700
Komatsu Chile S.A. 96.843.130-7. | Chile |[Employee’s relative Services y Supplies 20,446 138,962
Linde Gas Chile S.A. 90.100.000: | Chile. [Employee’s relative Supplies 147 91
Marsol S.A. 91.443.000-3 | Chile [Employee’s relative Supplies 101 –
San Lorenzo Isapre Limitada 76.521.250-2 | Chile |Subsidiary Services – 25,945
Services de Ingeniería IMA S.A. 76.523.610 | Chile. [Employee’s relative Services – 125
Soc. de Prod. y Serv. Solava Ltda 78.663..520-9 | Chile [Employee’s relative Supplies 57 –
Sociedad Contractual Minera El Abra. 96.701.340-4 | Chile [Associate Supplies 73 –
Sodimac S.A. 96.792.430 | Chile. [Employee’s relative Supplies 1,644 –
Sonda S.A. 83.628.100-4 | Chile |[Employee’s relative Services 221 –
Suez Medioambiente Chile S.A 77.441.870-9 | Chile [Employee’s relative Supplies 57 –
Transeleo Norte S.A. 99.521.960-6 | Chile | Member of Board of directors Services – 4411
S y $ Ingenieros Consultores S.A 84.146.102 | Chile |Employee’ relative Servicios 43 –

b) Key Management of the Corporation

In accordance with the policy established by the Board of Directors and its related regulations, the
transactions with the Directors, the Chief Executive Officer, Vice Presidents, Corporate Auditor, the
members of the Divisional Management Committees and Divisional General Managers shall be
approved by the Board of Directors.

During the year ended December 31, 2019 and 2018, the members of the Board of Directors have
received the following amounts as per diems, salaries and fees:

47
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

1/1/2019 1/1/2018
Taxpayer Nature of the Description of the 12/31/2019 12/31/2018
Name Country . . .
number relationship transaction Amount Amount
ThUS$ ES
Blas Tomic Errázuriz 5.390.891-8 Chile [Director Directors’s fees 115 122
Dante Contreras Guajardo 9.976.475-9 Chile [Director Directors’s fees – 34
Ghassan Day oub Pseli 14.695.762-5 Chile [Director Directors’s fees 92 97
Ghassan Day oub Pseli 14.695.762-5 Chile [Director Payroll 122 107
Hernán de Solminihac Tampier 6.263.304-2 Chile [Director Directors’s fees 92 63
Ignacio Briones Rojas 12.232.813-9 Chile [Director Directors’s fees 78 63
Isidoro Palma Penco 4.754.025-9 Chile [Director Directors’s fees 92 97
Juan Benavides Feliú 5.633.221-9 Chile [Chairman of the board Directors’s fees 138 95
Juan Morales Jaramillo 5.078.923-3 Chile [Director Directors’s fees 92 97
Laura Albornoz Pollmann 10.338.467-2 Chile [Director Directors’s fees 34
Oscar Landerretche Moreno 8.366.611-0 Chile [Chairman of the board Directors’s fees 51
Paul Schiodtz Obilinovich 7.170.719-9 Chile [Director Directors’s fees 92 97
Raimundo Espinoza Concha 6.512.182-4 Chile [Director Directors’s fees 92 97
Raimundo Espinoza Concha 6.512.182-4 Chile [Director Payroll 36 64

The Ministry of Finance through Supreme Decree No. 100, dated February 5, 2018, established the
compensation for the Corporation’s Directors. The compensation to Board of Director members, is as

follows:

a. The Directors of Codelco will receive a fixed monthly compensation of Ch$3,931,757 (three
million nine hundred and thirty one thousand, seven hundred and fifty seven Chilean pesos) for
meeting attendance. The payment of the monthly compensation is dependent on meetings

attended.

b. The Chairman of the Board will receive a fixed monthly compensation of Ch$7,863,513 (seven

million eight hundred and sixty three thousand, five hundred and thirteen Chilean pesos).

Cc. Each member of the Directors” Committee, whether the one referred to in Article 50 bis) of Law
No. 18046 or another established by the Corporation by-laws, will receive a fixed additional
monthly compensation of Ch$1,310,584 for meeting attendance, regardless of the number of
committees of which they are members. In addition, the Chairman of the Directors” Committee

will receive a fixed monthly compensation of Ch$2,621,171 for meeting attendance.

d. The compensation established in the legal text is effective for a period of two years, as from
June 1, 2018, and will be updated on January 1, 2019, in accordance with the same provisions
that govern the general salary adjustments of officials of the public sector. For the year 2019, the

readjustment is 3.5%.

48

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

On the other hand, the short-term benefits of key management of the Corporation paid during
the year ended December 31, 2019 and 2018, were ThUS$11,442 and ThUS$12,382,
respectively.

The methodology to determine the remuneration of key management was approved by the
Board of Directors at a meeting held on January 29, 2003.

During the year ended December 31, 2019 and 2018, severance indemnities were paid to key
management of the Corporation for ThUS$1,619 and ThUS$1,084, respectively.

There were no payments to key management for other non-current benefits during the year
ended December 31, 2019 and 2018.

There are no share based payment plans granted to Directors or key management personnel of
the Corporation.

c) Transactions with companies in which Codelco has ownership interest
The Corporation undertakes commercial and financial transactions that are necessary for ¡ts activities
with its subsidiaries, associates and joint ventures (“related parties”). The financial transactions
correspond mainly to loans granted (mercantile current accounts).
Commercial transactions with related companies mainly consist of purchases/sales of products or
rendering of services carried out under market conditions and prices, which do not bear any interest
or indexation.

As of the date of these financial statements, the Corporation has not recognized any allowance for
doubtful accounts with respect to receivable balances from ¡ts related companies.

The detail of accounts receivable and payable between the Corporation and its related parties as of
December 31, 2019 and 2018, is as follows:

Accounts receivable from related companies:

. Current Non-current

Taxpayer Nature of the Indexation
Name Country a a 12/31/2019 | 12/31/2018 | 12/31/2019 | 12/31/2018

number relationship currency

LES ES LES THUS$
77.762.940-9 Anglo American Sur S.A. Chile Associate US$ 16,677 88,497 –

76.063.022-5 Inca de Oro S.A. Chile Associate US$ 438 380 – –
76.255.054-7 Planta Recuperadora de Metales SpA Chile Associate US$ 1,677 3,099 15,370 20,306
96.701.340-4 Sociedad Contractual Minera El Abra Chile Associate US$ 2,077 383 – –
96.801.450-1 Agua de la Falda S.A. Chile Associate US$ 5.0 6 224 224
Totals 20,874 92,365 15,594 20,530

49
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Accounts payable to related companies:

Current Non-current
Taxpayer Nature of the Indexation
Name Country Monshi 12/31/2019 | 12/31/2018 | 12/31/2019 | 12/31/2018
number relationship currency
THUS$ ES THUS$ LES

77.762.940-9 ‘Anglo American Sur S.A. Chile Associate US$ 108,243 125,913
96.701.340-4 Sociedad Contractual Minera El Abra Chile Associate US$ 26,608 22,940
76.255.054-7 Planta Recuperadora de Metales SpA Chile Associate US$ 430 –
76.781.030-K Kairos Mining S.A. Chile Associate US$ 1,953 2,063
Totals 137,234 150,916

The following table sets forth the transactions carried out between the Corporation and its related
companies and their corresponding effects in profit or loss for the year ended December 31, 2019

and 2018:
1/1/2019 1/1/2018
12/31/2019 12/31/2018
Effects on net Effects on net
Taxpayer , o Index. . .
Entity Nature of the transaction | Country income (charges) / income (charges) /
number Currency . .
Amount credits Amount credits
Thus$ ThHUS$ Thuss$ ThuS$

96.801.450-1 | Agua de la Falda S.A. ¡Sales of services Chile CLP 3 3 4 4
96.801.450-1 | Agua de la Falda S.A. Capital contribution Chile US$ 19 338
77.762.940-9 | Anglo American Sur S.A. Dividends received Chile US$ 84,372 182,903
77.762.940-9 | Anglo American Sur S.A. Dividends receivable Chile US$ – – 84,372 –
77.762.940-9 | Anglo American Sur S.A. ¡Sales of goods Chile US$ 25,044 25,044 58,411 58,411
77.762.940-9 | Anglo American Sur S.A. ¡Sales of services Chile CLP 8,661 8,661 8,162 8,162
77.762.940-9 | Anglo American Sur S.A. Purchase of products Chile US$ 643,832 (643,832) 711,384 (711,384)

Extranjera [Deutsche Geissdraht GmbH Dividends received Alemania EURO – – 946
76.063.022-5 |Inca de Oro S.A. ¡Sales of services Chile CLP 198 16 214 29
77.781.030 |Kairos Mining Services Chile CLP 21,050 (21,050)| 31,281 (31,281)
77.781.030 |Kairos Mining ¡Sales of services Chile CLP 1 1
76.255.054-7 [Planta Recuperadora de Metales SpA Interest loans Chile US$ 1,029 1,029 1,029 1,029
76.255.054-7 [Planta Recuperadora de Metales SpA Services Chile US$ 23,656 (23,656)| 23,443 (23,443)
76.255.054-7 [Planta Recuperadora de Metales SpA ¡Sales of services Chile CLP 8,087 8,087 940 940
76.255.054-7 [Planta Recuperadora de Metales SpA ¡Sales of goods Chile US$ 65 65 4,077 4,077
76.255.054-7 [Planta Recuperadora de Metales SpA Loan recovery Chile CLP 5,966 3,242 –
96.701.340-4 |Soc. Contractual Minera El Abra Dividends received Chile US$ 3,062 – 4,900
96.701.340-4 |Soc. Contractual Minera El Abra Buy shares Chile US$ 4,000 4,000 – –
96.701.340-4 |Soc. Contractual Minera El Abra Purchase of products Chile US$ 242,900 (242,900) 293,173 (293,173)
96.701.340-4 |Soc. Contractual Minera El Abra ¡Sales of goods Chile US$ 39,046 39,046 24,79 24,79
96.701.340-4 |Soc. Contractual Minera El Abra Other sales Chile US$ 1,493 1,493 1,493 1,493
96.701.340-4 |Soc. Contractual Minera El Abra Perceived commissions — [Chile US$ 100 100 113 113
96.701.340-4 |Soc. Contractual Minera El Abra ¡Other purchases Chile US$ 39 (39) – –

d) Additional information

The current account receivable from Planta Recuperadora de Metales SpA. corresponds to the loan
agreement granted to build its plant, which was signed on July 7, 2014.

50

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The purchase/sales of products transactions with Anglo American Sur S.A., are regular business
activity transactions to buy/sell copper and other products. On the other hand, there are certain
transactions related to the contract entered into with the subsidiary Inversiones Mineras Nueva Acrux
SpA (whose non-controlling shareholder is Mitsui) and Anglo American Sur S.A., under which the
latter agreed to sell a portion of its annual copper output to said subsidiary.

4. Inventories

The detail of inventories as of December 31, 2019 and 2018, is as follows:

Current Non-current
Items 12/31/2019 12/31/2018 12/31/2019 12/31/2018
ThHUS$ TRUS$ TRUS$ ThHUS$

Finished products 210,309 446,344 –

Subtotal finished products, net 210,309 446,344 – –
Products in process 1,150,060 1,137,605 585,681 457,070
Subtotal products in process, net 1,150,060 1,137,605 585,681 457,070
Material in warehouse and other 723,264 555,504

Obsolescence allowance adjustment (162,498) (96,805)

Subtotal material in warehouse and other, net 560,766 458,699 – –
Total Inventories 1,921,135 2,042,648 585,681 457,070

The amount of inventories of finished goods transferred to cost of sales for the year ended December 31,
2019 and 2018 was ThUS$10,007,361 and ThUS$11,145,242, respectively.

For the year ended December 31, 2019 and 2018, the Corporation has not reclassified strategic
inventories to Property, Plant and Equipment.

The reconciliation of changes in the allowance for obsolescence ¡s detailed below:

Changes in Allowance for Obsolescence 1213112019 123112018
ThHUS$ ThUS$
Opening Balance (96,805) (94,083)
Period provision (65,693) (2,722)
Closing Balance (162,498) (96,805)

For the year ended December 31, 2019 and 2018, the Corporation recognized write-offs of damaged
inventories for ThUS$35.136 and ThUS$4,004, respectively.

The provision for the net realizable value of inventories was ThUS$38,144 for the year ended December
31, 2019 (ThUS$31,889 for the year ended December 31, 2018).

During the year ended December 31, 2019 and 2018, increases in the provision for net realizable value
were ThUS$6,255 and ThUS$28,890, respectively.

51
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

As of December 31, 2019 and 2018, there are no unrealized gains or losses recognized on the
intercompany sales of inventories of finished products.

As of December 31, 2019 and 2018, there are no inventories pledged as security for liabilities.
Income taxes and deferred taxes

a) Composition of income tax expense

1/1/2019 1/1/2018
Items 12/31/2019 | 12/31/2018

ThUS$ TRUS$
Current income tax (7,484) (92,270)
Eftect of Deferred Taxes (384, 160) (249,217)
Adjustments to current tax from the prior period – (19,956)
Other (1,601) 4,160
Total tax expense (393,245) (357,283)

b) Deferred tax assets and liabilities:

The following table details deferred tax assets and liabilities:

Deferred tax assets 12/31/2019 12/31/2018
ThUuS$ Thus$
Provisions 1,556,662 1,429,060
Right of use liabilities 4,808 13,162
Tax loss 613,340 250,255
Other 2,906 4,603
Total deferred tax assets 2,177,716 1,697,080
Deferred tax liabilities 1213112019 1213112018
TRUS$ TRUS$
Tax on mining activity 235,931 163,280
Property, plant and equipment 1,386,874 889,841
Postemploy ment benefit obligations 14,676 10,346
Accelerated depreciation for tax purposes 5,198,975 5,017,532
Fair value of mining properties acquired 108,518 108,518
Hedging derivatives — future contracts 14,889 12,282
Undistributed profits of subsidiaries 34,998 50,006
Total deferred tax liabilities 6,994,861 6,251,805

52
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The following tables sets forth the deferred taxes as presented in the statement of financial position:

Deferred taxes 12/31/2019 12/31/2018
TRUS$ TRUS$
Non-current assets 43,736 31,443
Non-current liabilities 4,860,881 4,586, 168
Net 4,817,145 4,554,725

The effects of deferred taxes on the components of other comprehensive income are as follows:

12/31/2019 | 12/31/2018

Deferred taxes on components of other comprehensive income
TRUS$ TRUS$

(Charge) credit cash flow hedge 52,072 (67,704)
Defined Benefit Plans 69,667 33,148
Total deferred tax effect on components of other comprehensive income (loss) 121,739 (34,556)

The following table sets forth the reconciliation of the effective tax rate:

12/31/2019
Reconciliation of tax rate Taxable Base At the Tax rate

25.0% 40.0% 5% 25.0% 40.0% 5% Total

ES ThHUSs$ Thus$ THus$ ES ThUS$ ES
Tax effect on the income (loss) before taxes 404,692 404,692 404,692 (101,173) (161,877) (20,235) (283,285)
Tax effect on the income (loss) before taxes of subsidiaries 3,081 3,081 3,081 (770) (1,232) (154) (2,156)
Tax effect consolidated profit (loss) before taxes 407,773 407,773 407,773 (101,943) (163,109) (20,389) (285,441)
Permanent differences:
First category income tax (25% ) 86,549 – – (21,637) – (21,637)
Specif tax for state-owned entities Art. 2 D.L. 2398 (40% ) . 60,799 . (24,320) – (24,320)
Specific tax on mining activities – – 1,136,260 – – (56,813) (56,813)
Single Tax Art 21 Inc. N*1 – – – – – – (3,417)
Differences imposed previous years – – – – – (1,617)
TOTAL TAX EXPENSE (123,580) — (187,429) — (77,202) (393,245)

12/31/2018
Reconciliation of tax rate Taxable Base At the Taxrate

25.0% 40.0% 5% 25.0% 40.0% 5% Total

ES ThHUSs$ Thus$ THus$ ES ThUS$ ES
Tax effect on the income (loss) before taxes 498,216 498,216 498,216 (124,554) (199,286) (24,911) (348,751)
Tax effect on the income (loss) before taxes of subsidiaries 48,814 48,814 48,814 (12,204) (19,526) (2,441) (34,171)
Tax effect consolidated profit (loss) before taxes 547,030 547,030 547,030 (136,758) (218,812) (27,352) (382,922)
Permanent differences:
First category income tax (25% ) (96,902) – – 24,226 – 24,226
Specific tax for state-owned entities Art. 2 D.L. 2398 (40% ) – (114,392) – 45,757 – 45,757
Specific tax on mining activities – – 868,189 – – (43,409) (43,409)
Single Tax Art 21 Inc. N*1 – – – – – – (3,856)
Others – – – – – 2,921
TOTAL TAX EXPENSE (412,532) — (173,055) — (70,761) (357,283)

53

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Pursuant to Article 2 of the Decree Law 2398, Codelco is subject to an additional tax rate of 40% on
income before taxes and dividends received in accordance with the law.

For the calculation of deferred taxes, the Corporation has applied a General Tax Regime, with first-
rate tax rates for the 2019 and 2018 business years of 25%. There ¡is no option to avail of the regimes
established in article 14, as a State Company. Meanwhile, the national subsidiaries and associates,
by default, have applied the Partially Integrated Taxation system with a rate of 27% for both years.
Foreign subsidiaries and associates have applied the tax rates in force in their respective countries.
In relation to the specific tax on mining activities the tax rate applicable is 5% under Law No. 20469.

The Corporation, as a Taxpayer of first category, is liable to the single Tax of 40%, contained in the
first paragraph of Article 21 of the Income Tax Law No. 824, in numbers ¡), ii) and ii) , the
disbursements incurred in said numerals.

6. Current and non-current tax assets and liabilities

The current tax balance is presented net of monthly provisional payments as an asset or liability in Current
Taxes, as the case may be, determined as indicated in section II. Main accounting policies, 2.1):

12/31/2019 | 12/31/2018

Current Tax Assets

ThUS$ TRUS$
Taxes to be recovered 22,719 13,645
Total Current Tax Assets 22,719 13,645

12/31/2019 | 12/31/2018
THUS$ US$

Current Tax Liabilities

Monthly Provisional Pay ment Provision 10,672 6,910
Provision Tax 3,185 3,867
Total Current Tax Liabilities 13,857 10,777

12/31/2019 | 12/31/2018
THUS$ TRUS$

Non-Current Tax Assets 222,169 143,606

Total Non-Current Tax Assets 222,169 143,606

Non-Current Tax Assets

Non-current recoverable taxes correspond to advance tax payments made provisionally and which are
probable of realization through utilization on future income tax returns. These non-current recoverable
taxes are not expected to be realized in the current period. The Corporation has tax loss carryforwards of
ThUS$874,222.

54
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

7. Property, Plant and Equipment

a) The items of property, plant and equipment as of December 31, 2019 and 2018, are as follows:

Property, Plant and Equipment, gross 1213112019 1213112018

TRUS$ THUS$
Construction in progress 6,234,130 8,808,652
Land 173,316 173,926
Buildings 5,963,605 5,403,295
Plant and equipment 19,217,547 15,894,046
Fixtures and fitings 58,631 58,807
Motor vehicles 2,080,124 2,062,920
Land improvements 6,504,063 5,619,800
Mining operations 8,751,368 7,214,915
Mine development 4,546,765 4,117,362
Assets by right of use 692,262 –
Other assets 1,164,163 1,380,354
Total Property, Plant and Equipment, gross 55,385,974 50,734,077

Property, Plant and Equipment, accumulated depreciation 1213112019 1213112018

TRUS$ THUS$

Construction in progress –

Land 9,975 8,964
Buildings 3,152,227 3,048,902
Plant and equipment 10,618,524 10,125,253
Fixtures and fitings 47,431 43,878
Motor vehicles 1,480,020 1,378,911
Land improvements 3,482,960 3,267,244
Mining operations 5,253,285 4,728,591
Mine development 893,575 804,318
Assets by right of use 260,110 –
Other assets 487,703 573,018
Total Property, Plant and Equipment, accumulated depreciation 25,685,810 23,979,079

Property, Plant and Equipment, net 12/31/2019 12/31/2018

THUS$ ThHUS$
Construction in progress 6,234,130 8,808,652
Land 163,341 164,962
Buildings 2,811,378 2,354,393
Plant and equipment 8,599,023 5,768,793
Fixtures and fitings 11,200 14,929
Motor vehicles 600,104 684,009
Land improvements 3,021,103 2,352,556
Mining operations 3,498,083 2,486,324
Mine development 3,653,190 3,313,044
Assets by right of use 432,152 –
Other assets 676,460 807,336

Total Property, Plant and Equipment, net 29,700,164 26,754,998

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

b) Movement of Property, plant and equipment:

Fixed
Movements Construction in | Lana | Buildings | Plantand | installations | Motor Ground Mining — |Development| Assetsby | Other Total
equipment and vehicles |improvements | operations | ofmines | rightofuse | assets
Thus$ progress .
accessories
Reconciliation of changes in properties, plant and equipment
Properties, plant and equipment at the beginning of the period. Opening Balance 1/1/2019 8,808,652| 164,962| 2,354,303| 5,768,793] 14,920| 684,009 2,352,556] — 2,486,324] — 3,313,044 -| 807,336| 26,754,998
Changes in property, plant and equipment
Increases other than those from business, property, plant and equipment combinations 3,602,113 . 1,750 14,525 23 7.852 19,128 521,191 . 109,505] — 14,917| — 4,291,004
Depreciation, property, plant and equipment =| (1,010)| — (162,340) (649,076) (8,663)| — (109,913) (215,641) (796,714) (87,933)| — (143,369)| (47,606)| (2,217,265)
Increases (decreases) in transfers and other changes, properties, plant and equipment
Increases (decreases) by transfers from constructions in process, properties, plant and equipment (6,173,762) -| 646,591] 3,511,039 6 17,702 816,773 1,176,508 5,049 – 94 –
Increases (decreases) by other changes, properties, plant and equipment 4,3380] — (611)| — (23,221) (28,739) (94) 1,874 48,561 110,774 423,030 465,558| — (95,338)] 906,183
Increase (decrease) by transfers and other changes, properties, plant and equipment (6,169,373)| — (611)| — 623,370| 3,482,300 (68) 19,576 865,334 1,287,282 428,079 465,558| (95,244)| 906,183
Dispositions and withdrawals of service, property, plant and equipment
Retirements, property, plant and equipment (7,262) | (5795) (17,519) (1) (1,420) (274) – . 458] (2.943)] (34,756)
Dispositions and withdrawals of service, property, plant and equipment (7,262) | (5,795) (17,519) 0) (1,420) (274) – – 458] (2,943)| (34,756)
Increase (decrease) in properties, plant and equipment (2,574,522) (1,621) 456,985| 2,830,230 (3,729)| (83,905) 668,547 1,011,759 340,146 432,152| (130,876)| 2,945,166
Properties, plant and equipment at the end of the period. Closing balance 12/31/2019 6,234,130] 163,341] 2,811,378] 8,599,023 11,200| 600,104 3,021,103| 3,498,083| 3,653,190 432,152| 676,460| 29,700,164
Fixed
Movements o Plantand | installations | Motor Mining Assets by | Other
Construction in | Land a . . Ground . Development| Total
Buildings | equipment and vehicles | operations : right ofuse | assets
Thus$ progress improvements of mines

accessories

Reconciliation of changes in properties, plant and equipment

Properties, plant and equipment at the beginning of the period. Opening Balance 1/1/2018 7,004,522| 167,086| 2,490,520] 5,660,185 17,842| 743,542 2,247,481] — 2,607,039] — 3,495,230 -| 842,056| 25,275,512
Changes in property, plant and equipment

Increases other than those from business, property, plant and equipment combinations 3,582,688 . 138 21,028 376 1,383 484 375,575 1,125 “| 38,478| 4,021,275
Depreciation, property, plant and equipment | (1.011)| — (167,547) (665,721) (8,669)| — (113,872) (218,323) (859,955) (80,153) -| (70,299)| (2,180,550)
Impairment losses recognized in profit or loss for the period (2,179) -| (82,585) (88,677) – (140) (4,786) – . -| (10,531)| — (198,898)
Increases (decreases) in transfers and other changes, properties, plant and equipment

Increases (decreases) by transfers from constructions in process, properties, plant and equipment (1,281,365) -| 102,865 812,901 647 51,758 191,986 21,168 99,681 – 359 .
Increases (decreases) by other changes, properties, plant and equipment (851,945)| — (1,113) 11,228 46,177 (68) 2,879 135,714 342,497| (202,839) | 7536 (9,934)
Increase (decrease) by transfers and other changes, properties, plant and equipment (1,633,310) — (1,113)| — 114,093 859,078 579 54,637 327,700 363,665] (103,158) «| 7,895 (9,934)
Dispositions and withdrawals of service, property, plant and equipment

Retirements, property, plant and equipment (143,069) . (235) (7,100) (199) (1,541) . – . – (263)| — (152,407)
Dispositions and withdrawals of service, property, plant and equipment (143,069) – (235) (7,100) (199) (1,541) – – – – (263)| — (152,407)
Increase (decrease) in properties, plant and equipment 1,804,130| —(2,124)| _ (136,136) 108,608 (2,913)| (59,533) 105,075 (120,715)| (182,186) «| (34,720)| 1,479,486
Properties, plant and equipment at the end of the period. Closing balance 12/31/2018 8,808,652] 164,962| 2,354,393| 5,768,793 14,929| 684,009 2,352,556] 2,486,324| 3,313,044, -| 807,336| 26,754,998

56
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

c)

The balance of construction in progress, is directly associated with the operating activities of the
Corporation, and relates to the acquisition of equipment for projects in construction and associated
costs toward their completion.

The Corporation has signed insurance policies to cover the possible risks to which the various
property, plant and equipment items are subject, as well as the possible claims that may arise for the
period of its activities. Such policies sufficiently cover the risks to which they are subject in
Management’s opinion.

Borrowing costs capitalized for the year ended December 31, 2019 and 2018 were ThUS$367,548
and ThUS$31 1,399, respectively. The annual capitalization average rate for the year ended
December 31, 2019 and 2018 was 4.19% and 4.42%, respectively.

Expenses on exploration and drilling of deposits recognized in profit or loss and the cash outflows
disbursed for the same concepts are presented in the following table:

1/1/2019 1/1/2018
Expenditure on exploration and drilling reservoirs 12/31/2019 | 12/31/2018
ThUS$ TRUS$

Recognized in profit /(loss) 47,048 50,765
Cash outflows disbursed 47,551 62,857
The detail of “Other assets” under “Property, plant and equipment” is as follows:
Other assets, net 12/31/2019 | 12/31/2018
TRUS$ TRUS$
Leased assets (1) – 93,334
Mining properties from the purchase of Anglo American Sur S.A. 402,000 402,000
Maintenances and other major repairs 217,079 235,091
Other assets — Calama Plan 54,174 72,225
Other 3,207 4,686
Total other assets, net 676,460 807,336

(1) As of January 1, 2019, the lease agreements under lAS 17 and IFRIC 4 become part of the lease
agreements under IFRS 16 that are classified under the name of assets for right of use.

During the first quarter of 2018, US$103.6 million were reclassified from the line item Intangible
assets other than goodwill, to Construction in Progress of Property, plant and equipment,
corresponding to assets of the Continuous Mining project (see note 9 Intangible Assets other than
goodwill) that could potentially be used in other operations and / or projects of the Corporation.

Subsequently, US$66.4 million (US$23 million after taxes) from the assets mentioned above were
written off as of June 30, 2018.

The Corporation currently has no ownership restrictions relating to assets belonging to Property,
plant and equipment, except for leased assets whose legal title corresponds to the lessor.

57
CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

j) Codelco has not pledged any items of property, plant and equipment as collateral to third parties in
order to enable the realization of its normal business activities or as a commitment to support

payment obligations.

k) According to the policy indicated in note 2 ¡), referring to impairment property, plant and equipment
and intangible assets, and as indicated in note 21, for the year ended December 31, 2018, the
Corporation recorded an impairment in the value of the Ventanas assets for an amount of
ThUS$198,898 before taxes. At December 31, 2019, the property, plant and equipment assets
showed no indicators of impairment or reversals of impairments recognized in previous years, so that
no adjustments were made to the value of the assets at that date. (see note 21).

1) As of December 31, 2019, the composition by asset class of assets for right of use ¡s:

Assets by right of use 12/31/2019 | 1/1/2019
TRUS$ THUS$
Buildings 18,286 24,069
Plant and equipment 298,463 283,750
Motor vehicles 11,504 140,960
Fixtures and fitings 97,952 12,028
others assets by right ofuse 5,947 6,922
Total Assets by right of use 432,152 467,729

m) The Corporation presents at December 31, 2019 a reclassification of property, plant and equipment
to the item intangible assets other than goodwill which amounts to ThUS$2,090.

Investments accounted for using the equity method

The following table sets forth the carrying amount and the share of profit (loss) of the investments
accounted for using the equity method (all material associates’ principal place of business is Chile) :

Equity Interest Carrying Value Net income (loss)
Associates Taxpayer Funct. Cuurenc. 1/1/2019 1/1/2018
Numbers 12/31/2019 12/31/2018 12/31/2019 12/31/2018 12/31/2019 12/31/2018
% % ThUS$ THUS$ ThUS$ ThUS$
Agua de la Falda S.A. 96.801.450-1 USD 42.26% 42.26% 4,864 4,953 (279) (329)
Anglo American Sur S.A. 77.762.940-9 USD 29.5% 29.5% 2,850,171 2,835,412 19,852 99,709
Deutsche Geissdraht GmbH Foreign USD 0.0% 40.0% – – 1,159
Inca de Oro S.A. 73.063.022-5 USD 33.19% 33.19% 12,675 12,913 (101) (42)
Kairos Mining S.A. 76.781.030-K USD 40.00% 5.00% 82 – 29 –
Minera Purén SCM 76.028.880-2 USD 35.0% 35.0% 9,934 9,902 32 8
Planta Recuperadora de Metales SpA 76.255.054-7 USD 34.0% 34.0% 10,914 10,365 549 55
¡Sociedad Contractual Minera El Abra 96.701.340-4 USD 49.0% 49.0% 594,883 610,339 (12,799) 10,181
Sociedad GNL Mejillones S.A. 76.775.710-7 USD 0.0% 37.0% – 84,409 5,920 8,373
TOTAL 3,483,523 3,568,293 13,203 119,114

58

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

a)

Associates
Agua de la Falda S.A.

As of December 31, 2019, Codelco holds a 42.26% ownership interest in Agua de la Falda S.A., with
the remaining 57.74% owned by Minera Meridian Limitada.

The corporate purpose of this company is to exploit deposits of gold and other minerals, in the third
region of Chile.

Sociedad Contractual Minera El Abra

Sociedad Contractual Minera El Abra was incorporated in 1994. As of December 31, 2019, Codelco
holds a 49% ownership interest, with the remaining 51% owned by Cyprus El Abra Corporation, a
subsidiary of Freeport-McMoRan Copper 8 Gold Inc.

On October 9, 2019, El Abra increased its capital by ThUS$4,000 represented by 300 shares.
Codelco bought all the shares and made payment through a contribution in the domain of
Concesiones Mineras. Along with the subscription of shares, Codelco sold 153 shares (51%) to
Cyprus El Abra Corporation, thus maintaining the structure and percentage participation of the
company’s shareholders.

The company business activities involve the extraction, production and selling copper cathodes.
Sociedad Contractual Minera Purén

As of December 31, 2019, Codelco holds a 35% ownership interest, with the remaining 65% owned
by Compañía Minera Mantos de Oro.

This company’s corporate purpose is to explore, identify, survey, investigate, develop and exploit
mining deposits in order to extract, produce and process minerals.

Sociedad GNL Mejillones S.A.

The corporate purpose of this company is the production, storage, marketing, transportation and
distribution of all types of fuel, and the acquisition, construction, maintenance and operation of
infrastructure facilities and construction projects necessary for transport, reception, processing and
storage both in Chile and abroad, by itself or in partnership with third parties.

As of December 31, 2018, Codelco held a 37% ownership interest, with the remaining 63% owned by
Suez Energy Andino S.A. These shareholdings were established on November 5, 2010, when the
Corporation did not participate in the capital increase agreed to at Shareholders’ meeting of such
company. Prior to the capital increase, the Corporation and Suez Energy Andino S.A. held a 50%
ownership interest each.

59
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The Corporation made, on August 6, 2019, the sale of its 37% stake in the company GNL Mejillones
S.A. to the Ameris Capital AGF Investment fund, for an amount of US$193.5 million.

The sale of the LNG Mejillones stake generated a profit of US$103 million before tax (note 22) and a
result after tax of US $ 36 million.

Inca de Oro S.A.

On June 1, 2009, Codelco’s Board of Directors authorized the incorporation of a new company aimed
to develop studies allowing the continuity of the Inca de Oro Project, which is a wholly-owned
subsidiary of Codelco.

On February 15, 2011, the business association of Codelco and Minera PanAust IDO Ltda. in respect
to the Inca de Oro deposit was approved. As a result Minera PanAust IDO Ltda holds 66% ownership
interest and the remaining 34% is held by Codelco.

This transaction resulted in a gain after taxes of ThUS$33,668 recognized in the year ended
December 31, 2011.

At the Extraordinary meeting of the shareholders held on December 30, 2014, a capital increase of
ThUS$102,010 was agreed upon, reducing Codelco’s ownership interest to 33.19%.

As of December 31, 2015, the Corporation reduced the carrying amounts of mining property and
exploration and evaluation expenditures as a result of an impairment loss recognized.

As of December 31, 2019, Codelco holds a 33.19% ownership interest in this company.
Planta Recuperadora de Metales SpA

On December 3, 2012, Planta Recuperadora Metales SpA was incorporated by Codelco, which held
a 100% ownership interest of this company.

On July 7, 2014, Codelco reduced its ownership interest in Planta Recuperadora de Metales SpA to
51%, with the remaining 49% ownership interest held by LS-Nikko Copper Inc.

On October 14, 2015, Codelco reduced its ownership interest to 34% interest, with LS-Nikko Copper
Inc, holding the remaining 66%.

As of December 31, 2019, LS-Nikko Copper Inc, is the controlling shareholder of this company based
on the control elements set out in the shareholders’ agreement.

The principal business activity of the company is the processing of intermediate products of the
refining and processing of copper and other metals aiming to recover the copper, other metals and
other sub products, their transformation to commercial products and the selling and distribution of all
classes of goods or inputs derived from such process.

60
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Deutsche Giessdraht GmbH

On July 31, 2018 the share sale agreement was finalized representative of the shareholding in
Deutsche Giessdraht GmbH maintained by Codelco Kupferhandel GmbH. (CK), which until before
that date was the holder of a 40% stake in the capital of DG.

The acquiring company of the shares was the Aurubis Company AG, which was, until before the sale
transaction, the majority shareholder of DG. The result after taxes of this transaction was Euro
15,214 Thousands (ThUS$18,172 in its equivalence to the exchange rate of the date of the
transaction).

Anglo American Sur S.A.

As December 31, 2019, the controlling shareholder of Anglo American Sur S.A. is Inversiones Anglo
American Sur S.A. holding a 50.06% ownership interest, while the non-controlling interest is held by
Inversiones Mineras Becrux SpA., which in turn is a subsidiary controlled by Codelco with a 67.8%
ownership interest. Consequently, Codelco exercises significant influence in Anglo American Sur
S.A. through its indirect ownership interest of 29.5%.

On December 21, 2017, according to archive No. 12285 / 2017, by public deed, it was agreed
between the shareholders to merge the Acrux SpA Mining Investment Company (“Absorbed
Company”) into the Investment Company Minera Becrux SpA (“Absorbing Company”), which took
effect as of December 22, 2017, where the Absorbing Company acquired all the assets and liabilities
of the Absorbed Company, which was to be dissolved without the need for its liquidation. In addition,
the Absorbing Company is responsible for the payment of all taxes owed or which may be owed by
the Absorbed Company.

The principal activities of the Company are the exploration, extraction, exploitation, production,
processing and trading of minerals, concentrates, precipitates, copper bars and all metallic and non-
metallic minerals, all fossil substances and liquid and gaseous hydrocarbons. This includes the
exploration, exploitation and use of all natural energy sources capable of industrial use and the
products or by-products obtained, as well as any other related, connected or complementary
activities on which the shareholders agree.

Kairos S.A.

Until before November 26, 2012, the Corporation held a 40% stake in conjunction with Honeywell
Chile S.A. who was the majority shareholder with 60% of the capital stock of Kairos Mining S.A.

On November 26, 2012, the Corporation sold part of its stake to Honeywell Chile SA, which implies

that Codelco maintained a 5% interest as of December 31, 2012, while the remaining 95% was held
Honeywell Chile S.A. The result of this pre-tax operation was ThUS$13.

61
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

On June 6, 2019, Codelco purchased 350 shares of Kairos Mining from Honeywell Chile S.A.,
increasing its participation from 5% to 40%.

As of December 31, 2019, the control of the company lies in Honeywell Chile S.A. which owns 60%
of the shares while Codelco owns the remaining 40%.

The purpose of the company is to provide automation and control services for industrial and mining
activities and to provide technology and software licenses.

The following tables provide details of asset and liabilities of the associates as of December 31, 2019
and 2018, and their profit (loss) for the year ended December 31, 2019 and 2018:

Assets and Liabilities 12/31/2019 12/31/2018
TRUS$ TRUS$
Current Assets 1,735,588 1,805,003
Non-current Assets 5,248,569 5,637,321
Current Liabilites 618,644 1,008,086
Non-current Liabilities 1,793,879 1,699,529
1/1/2019 1/11/2018
Net Income 12/31/2019 12/31/2018
TRUS$ ThUS$
Revenue 2,825,062 3,256,402
Cost of sales (2,646,416) (2,665,805)
Profit for the year 178,646 590,597
Movements of Investment in Associates 1/1/2019 1/1/2018
12/31/2019 12/31/2018
TRUS$ TRUS$
Opening balances 3,568,293 3,665,601
Contributions 2,200 338
Dividends (3,062) (213,172)
Result of the period 13,203 119,114
Sales (90,328) –
Other comprehensive income (6,648) (710)
Other (135) (2,878)
Final balance 3,483,523 3,568,293

The following tables provide details of asset and liabilities of the principal associates as of December
31, 2019 and 2018, and their profit (loss) for the years ended December 31, 2019 and 2018.

62
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Anglo American Sur S.A.
Assets and liabilities 12/31/2019 12/31/2018
TRUS$ TRUS$
Current Assets 1,099,695 1,164,724
Non-current Assets 4,083,739 4,104,271
Current Liabilities 531,089 890,874
Non-current Liabilites 1,405,143 1,226,503
1/1/2019 1/1/2018
Net Income 12/31/2019 12/31/2018
TRUS$ TRUS$
Revenue 2,286,876 2,543,730
Costof sales (2,174,029) (2,158,834)
Profit for the y ear 112,847 384,896

Sociedad Contractual Minera El Abra

Assets and liabilities 1213112018 1213112018
ThUs$ ThUS$
Current Assets 590,850 576,167
Non-current Assets 1,007,012 1,013,165
Current Liabiliies 79,422 73,458
Non-current Liabilities 304,394 270,283
1/1/2019 1/1/2018
Net Income 12/31/2019 12/31/2018
TRUS$ TRUS$
Revenue 493,531 596,060
Cost of sales (519,651) (575,283)
Profit (loss) for the year (26,120) 20,777

b) Additional information on unrealized profits (losses)

Codelco enters into transactions for the purchase and sale of copper with Sociedad Contractual
Minera El Abra. As of December 31, 2019 and 2018, there were no unrealized profits (losses)
recognized in the carrying amount of inventories of finished products.

The Corporation has recognized unrealized profits for the purchase of rights to use the LNG terminal

from the El Abra Mining Contract Company for ThUS$3,920 as of December 31, 2019, (as of
December 31, 2018: ThUS$3,920).

63
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

e)

d)

Investments in associates acquired

On August 24, 2012, Codelco recognized the acquisition of ownership interest in Anglo American Sur
S.A. which resulted in the initial recognition of the cost of the investment for ThUS$6,490,000 that
corresponded to the proportionate share (29.5%) of the net fair value of the identifiable assets and
liabilities acquired.

In determining the share of the fair value of the identifiable assets and liabilities acquired, the
Corporation considered the resources and mineral reserves that could be measured reliably and the
assessment of intangibles and all other considerations about contingent assets and liabilities.

The allocation of the purchase price at fair value between the identifiable assets and liabilities was
prepared by management using its best estimate and taking into account all relevant and available
information at the acquisition date of Anglo American Sur S.A.

The acquisition did not result in obtaining control of the acquired company.

The Corporation used a discounted cash flows model to estimate cash flow projections, based on the
life of mine. These projections were based on estimated production and future prices of minerals,
operating costs and capital costs, among other estimates made at the date of acquisition.
Additionally, proven and probable resources to explore were not included in the mine plan, therefore,
they were valued separately using a market model. Such resources are included in item “Mineral
Resources.”

As part of this process and by applying the valuation criteria indicated above, the fair value of the net
assets of Anglo American Sur S.A. was US$22,646 million, therefore the proportionate share
acquired by Inversiones Mineras Becrux SpA (29.5%) was equivalent to US$6,681 million at the
acquisition date.

Additional information on impairment of investments accounted for using the equity method

As of December 31, 2015, the Corporation identified indicators of impairment in the operating units of
Anglo American Sur S.A. Consequently, and with the purpose of making the corresponding
adjustments to the investment in this associate, the Corporation estimated its recoverable amount.

In determining the recoverable amount, the Corporation applied the methodology of fair value less
costs of disposal. The recoverable amount of the operating units was determined based on the life of
mine by using a discounted cash flow model whose main assumptions included ore reserves
declared by the associate, copper price, supply costs, foreign exchange rates, discount rate and
market information for the long-term asset valuation. The discount rate used was annual rate of 8%
after taxes.

64
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Furthermore, the proven reserves not included in the LOM, as well as the probable reserves to
explore, have been valued using a multiples market approach for comparable transactions. Such
methodology is consistent with the methodologies used at the acquisition date, which is described in
letter c) above.

The recoverable amount as estimated was less than the carrying amount of the identified assets of
the associate, therefore, the Corporation recognized an impairment loss of ThUS$2,439,495, which
was included within the line item “Share of profit or loss of associates and joint ventures accounted
for using the equity method” in the consolidated statement of comprehensive income for the year
ended December 31, 2015. The impairment loss was mainly attributable to the drop in copper prices
during the year 2015.

Subsequent to recognition of the impairment, there have been no indicators requiring the recognition
of further impairment losses on the recoverable amount of the investment held in Anglo American Sur
S.A.

As of December 31, 2016, the parent company of Anglo American Sur S.A. reviewed the discounted
cash flow model of its cash generating units (CGU), determining an impairment loss for the El
Soldado CGU of US$200 million due to the uncertainty related to obtaining the required approval of
its operational plan from the National Mining and Geology Service (“SERNAGEOMIN” in ¡ts Spanish
acronym), which raised questions about the generation of future economic benefits to support the
value of the assets related to such CGU.

Consequently, and with the purpose of making the corresponding adjustments to the recognition its
investment in the associate, the Corporation estimated its recoverable amount by considering the fair
value of the identified net assets of the associate El Soldado. The recoverable amount as estimated
was less than the carrying amount of the identified assets of the associate, therefore, the Corporation
recognized an impairment loss of ThUS$78,811 over the identified assets related to El Soldado
operations, which was included within the line item “Share of profit or loss of associates and joint
ventures accounted for using the equity method” in the statement of comprehensive income for the
year ended December 31, 2016.

On April 27, 2017, the SERNAGEOMIN approved the updated mine plan for El Soldado, based on
this resolution Anglo American Sur S.A. has resumed the operations of the mine. Consequently, the
company recognized a reversal of an impairment loss for US$193 million.

As of December 31, 2017, Codelco made a corresponding adjustment to the identified assets at the
acquisition date of the investment associated with El Soldado operations by recognizing a reversal of
an impairment loss of ThUS$67,277, which is presented in the line item “Share of profit or loss of
associates and joint ventures accounted for using the equity method.”

As of December 31, 2019 and 2018, there are no indicators of impairment nor reversal, therefore,
there have been no adjustments recognized to the carrying amounts of the assets.

65
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

e) Share of profit or loss for the year

The share in profit or loss of the associate Anglo American Sur S.A. recognized for the year ended
December 31, 2019 was income of ThUS$33,290 (income of ThUS$113,544 for the year ended
December 31, 2018). In addition, the Corporation has made appropriate adjustments to its share of
profit or loss in the associate for depreciation of the depreciable assets based on the fair values at
the acquisition date, which resulted in an expense of ThUS$13.438 for the year ended December 31,
2019 (an expense of ThUS$13,835 for year ended December 31, 2018) recognized within line item
“Share of profit or loss of associates and joint ventures accounted using the equity method” in the
consolidated statement of comprehensive income.

9. Intangible assets other than goodwill
As of December 31, 2019 and 2018, the intangible assets other than goodwill are described as follows:

a) This item is composed of the following:

Intangible assets composition 12/31/2019 12/31/2018
TRUS$ TRUS$
Intangible assets with finite useful lives, net 37,789 40,421
Intangible assets with indefinite useful lives 10,048 7,958
Total 47,837 48,379

66

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

b) Carrying amount and accumulated amortization:

12/31/2019
Accumulated
intangible assets Gross Amortization Net
ThUS$ TRUS$ TRUS$
Trademarks, patents and licenses 28 – 28
Water rights 10,048 – 10,048
Sofware 2,738 (1,745) 993
Other intangible assets 36,791 (23) 36,768
Total 49,605 (1,768) 47,837
12/31/2018
Accumulated
intangible assets Gross Amortization Net
ThUS$ TRUS$ TRUS$
Trademarks, patents and licenses 28 – 28
Water rights 7,958 – 7,958
Sofware 2,803 (1,351) 1,452
Other intangible assets 38,950 (9) 38,941
Total 49,739 (1,360) 48,379

c) Reconciliation of the carrying amount at beginning and end of the period:

Trademarks, | y Technological
Movements patents and | ¿oa | Software | developmentand | Other | Total
licenses Y innovation

Reconciliation of changes in intangible assets other than goodwill
Intangible assets other than goodwill. Opening balance (1/1/2019) 28 7,958 | — 1,452 | 38,941 48,379
Changes in intangible assets other than goodwill

Increases other than those arising from business combinations, intangible assets other than goodwil – – 13 – 40 53
Amortization, intangible assets other than goodwil – – (594) | (2,210) (2,804)
Increases (decreases) in transfers and other changes, intangible assets other than goodwill

Increases (decreases) in transfers and other changes, intangible assets other than goodwil – 2,090 – – – 2,090
Increases (decreases) due to other changes, intangible assets other than goodwil – 122 – 0] 119
Increase (decrease) in transfers and other changes, intangible assets other than goodwill – 2,090 122 6 2,209
Provisions and withdrawals of service, intangible assets other than goodwill

Service retirements / retirements, intangible assets other than goodwill

Provisions and withdrawals of service, intangible assets other than goodwill . – . .
Increase (decrease) in intangible assets other than goodwill – 2,090 (459) -| (2173) (542)
Intangible assets other than goodwill. Final Balance 12/31/2019 28| 10,048 993 – | 36,768 47,837

67

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Trademarks, Technological

Water

Movements patents and | ¡yy | Software | devolopmentand | Other Total
licenses innovation

Reconciliation of changes in intangible assets other than goodwill

Intangible assets other than goodwill. Opening balance (1/1/2018) 28 7959 | 1,693 175,710 | 33,727 | 249,117

Changes in intangible assets other than goodwill

Increases other than those arising from business combinations, intangible assets other than goodwil – – 586 704 | 9,261 10,551

Amortization, intangible assets other than goodwil – – (590) – (690)

Increases (decreases) in transfers and other changes, intangible assets other than goodwill

Increases (decreases) in transfers and other changes, intangible assets other than goodwil – (103,638) – | (103,638)
Increases (decreases) due to other changes, intangible assets other than goodwil – ( (62) – (859) (422)
Increase (decrease) in transfers and other changes, intangible assets other than goodwill – ( (62) (103,638) (359)| — (104,060)
Provisions and withdrawals of service, intangible assets other than goodwill

Service rerements / retirements, intangible assets other than goodwill – – (175) (72,TT6)| — (3,688)| — (76,639)
Provisions and withdrawals of service, intangible assets other than goodwill – . (175) (72,776)| — (3,688)| — (76,639)
Increase (decrease) in intangible assets other than goodwill – (1 (241) (175,740) 5,214 | (170,738)
Intangible assets other than goodwill. Final Balance 12/31/2018 28 7,958 | 1,452 -| 38,941 48,379

d)

Additional Information

As of January 1, 2018, the balance of ThUS$175,710 corresponded mainly to the internally
generated technological development project: Continuous Mining.

Continuous Mining is a project of the Corporation aimed toward development of an internal
technological breakthrough associated with the exploitation of underground mines, the main
characteristics of the project are: (1) reduction in the exposure of workers to mineral extraction areas;
(2) increasing the pace of mineral extraction; and (3) simultaneous mineral extraction from different
sections.

This project began in 2005, when the first conceptual tests were made, and in 2007 and 2008 it was
applied at the pilot level and from 2009 the basic and detailed engineering and the construction
phase for industrial validation at the West sector of third panel of Andina Division were performed,
which was expected to be carried out through 2018. lt was expected that its subsequent
implementation would be at Chuquicamata Underground and of the new mining projects of Codelco.
During the 2018 period, project studies were carried out and Management decided not to continue
with it.

In view of the discontinuation of the project during the first quarter of 2018, a write-off of US$71.7
million before tax (US$25 million after taxes) associated with basic engineering, construction and
equipment was recognized in profit or loss. In addition, US$103.6 million was reclassified to Property,
plant and equipment in relation to those assets that might potentially be used in other operations and
/ or projects of the Corporation. As a result of a subsequent review, an additional write-off for
US$66.4 million (see note 8 Property, plant and equipment) of assets was recognized. Consequently,
the total write-offs as of December 31, 2018, related to this project was US$138.1 million (US$48
million after taxes).

68
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

As of December 31, 2019 and 2018, there are no fully amortized intangible assets that are still in use.
For the year ended December 31, 2019 and 2018, research and technological development and
innovation expenditures recognized in assets were ThUS$7,536 and ThUS$6,816 (accrued),
respectively. On the other hand, research recognized in expense was ThUS$4,956 and
ThUS$10,042 (expended) for the year ended December 31, 2019 and 2018 respectively.

10. Subsidiaries

The following tables set forth a detail of assets, liabilities and profit (loss) of the Corporation’s subsidiaries,
prior to consolidation adjustments:

Assets and liabilities 1213112019 12/31/2018
Thus$ Thus$
Current assets 464,674 621,753
Non Current Assets 3,607,177 3,605,801
Current Liabiliies 281,973 305,030
Non Current Liabilities 1,086,975 1,122,471
1/1/2019 1/1/2018
Profit (loss) 12/31/2019 12/31/2018
THUS$ ThUuS$
Ordinary Income 1,140,473 2,119,617
Ordinary Expenses (1,176,801) (2,071,713)
Profit (loss) of year (36,328) 47,904

69
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

11. Current and non-current financial assets

Current and non-current financial assets included in the statement of financial position are as follows:

12/31/2019
At fair value though . Total financial
Amortized Cost Derivatives for hedging
Classification in the statement of financial profit and loss — assets
position Hedging Cross currency
derivatives swap

ThUS$ ThUuS$ ThUs$ ThUuS$ ThUS$
Cash and cash equivalents 2,158 1,300,947 – – 1,303,105
Trade and other current receivables 723,619 1,864,649 – – 2,588,268
Non – current receivables – 98,544 – – 98,544
Current receivables from related parties – 20,874 – – 20,874
Non – current receivables from related parties – 15,594 – 15,594
Other current financial assets – 171,636 1,315 – 172,951
Other non – current financial assets – 8,691 525 82,584 91,800
TOTAL 725,777 3,480,935 1,840 82,584 4,291,136

12/31/2018

At fair value though Amortized Cost Derivatives for hedging Total financial

Classification in the statement of financial profit and loss — assets

position Hedging Cross currency
derivatives swap

ThUS$ ThUuS$ ThUs$ ThUuS$ ThUS$
Cash and cash equivalents 1,698 1,227,427 – – 1,229,125
Trade and other current receivables 789,710 1,422,499 – – 2,212,209
Non – current receivables – 84,731 – – 84,731
Current receivables from related parties – 92,365 – – 92,365
Non – current receivables from related parties – 20,530 – 20,530
Other current financial assets – 187,870 43,539 – 231,409
Other non – current financial assets – 23,089 14,962 107,700 145,751
TOTAL 791,408 3,058,511 58,501 107,700 4,016,120

» Fair value through profit or loss: As of December 31, 2019, this category mainly includes
receivables from provisional invoicing sales. Section 11.2.r.

» Amortized cost: lt corresponds to financial assets held within a business model whose objective is to
hold financial assets to collect contractual cash flows that are solely payments of principal and interest
on the principal outstanding. These assets are not quoted in an active market.

The effects on profit or loss recognized for these assets are mainly from financial income and
exchange differences from balances denominated in currencies other than the functional currency.

No material impairments were recognized in trade and other receivables.

70
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

e Derivatives for Hedging: Corresponds to the balance for changes in the fair value of derivative
contracts to cover existing transactions (cash flow hedges) and that affect the profit or loss when
transactions are settled or when, to the extent required by accounting standards, a compensation
effect is charged (credited) to the income statement. The detail of derivative hedging transactions is
included in the Note 28.

As of December 31, 2019 and 2018, there were no reclassifications between the different categories of
financial instruments, under the accounting standards at the respective dates.

12. Other financial liabilities
Current and non-current interest-bearing borrowings consists of loans from financial institutions, bond
issuance obligations and finance leases, which are measured at amortized cost using the effective

interest rate method.

The following tables set forth other current/non-current financial liabilities:

12/31/2019
Current Non-current
Items Amortized Cost Hedging Amortized Cost Hedging

derivatives Total derivatives Total

LES LES LES Thus$ Thus$ Thus$
Loans from financial institutions 066,144 – 666,144 2,408,267 – 2,408,267
Bonds issued 572,587 – 572,587 13,617,358 – 13,617,358
Lease 127,761 – 127,761 305,110 – 305,110
Hedging derivatives – 11,496 11,496 – 148,987 148,987
Other financial liabilities 363 – 363 58,501 – 58,501
Total 1,366,855 11,496 1,378,351 16,389,236 148,987 16,538,223

12/31/2018
Current Non-current
Items Amortized Cost Hedging Amortized Cost Hedging

derivatives Total derivatives Total

LES LES LES Thus$ Thus$ Thus$
Loans from financial institutions 404,871 – 404,871 2,107,078 – 2,107,078
Bonds issued 435,429 – 435,429 12,310,307 – 12,310,307
Lease 21,510 – 21,510 86,329 – 86,329
Hedging derivatives – 10,096 10,096 – 106,824 106,824
Other financial liabilities 371 – 371 63,972 – 63,972
Total 862,181 10,096 872,277 14,567,686 106,824 14,674,510

71
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Loans from financial institutions:

The loans obtained by the Corporation aim to finance production operations oriented towards the
foreign market.

On August 23, 2012, the subsidiary Inversiones Gacrux SpA (Gacrux) signed a credit agreement with
Oriente Copper Netherlands BV (a subsidiary of Mitsui £ Co, Ltd, (“Mitsui”)) for approximately
US$1,863 million, renewable monthly until November 26, 2012, after which, if not paid or renegotiated,
will automatically become a loan with a 7.5 year maturity from the date of disbursement, and an annual
rate of Libor + 2.5%. This loan has no underlying guarantees given by Codelco.

The proceeds from the loan were used by Codelco’s indirect subsidiary Inversiones Mineras Becrux
SpA to acquire 24.5% of the shares of Anglo American Sur S.A., including other acquisition-related
expenses.

On October 31, 2012, the credit agreement was amended, the new terms established an annual fixed
interest rate of 3.25% and a 20-year maturity, to be paid in 40 semi-annual installments of principal and
interest, and maintaining the “non-recourse” (no underlying guarantee) condition. Under previous
agreements, Mitsui is entitled to an additional interest equivalent to one-third of the savings obtained
by Gacrux under the renegotiated credit as compared to the conditions from the credit agreement
originally signed. Thus, Mitsui (through its subsidiary) held an option to acquire from Gacrux an
additional 15.25% of the shares of Inversiones Mineras Acrux SpA (“Acrux”), at a fixed price of
approximately US$998 million. These funds were fully allocated to a portion of Gacrux’s debt under the
Credit Agreement.

On November 26, 2012, Mitsui exercised the call option and acquired the additional ownership interest
in Acrux. The proceeds received were used by Codelco to partially pre-pay the debt with Mitsui.

On November 26, 2016, Codelco signed a credit agreement with Oriente Copper Netherlands BV
renegotiating the payment of principal at the end of the contract. The terms established an annual
interest rate of Libor +2.5% with a 5 year maturity to be payable in one installment at maturity with
semi-annual interest payment.

On May 26, 2017, Codelco signed a credit agreement with Oriente Copper Netherlands BV
renegotiating the semi-annual payment. The terms established an annual interest rate of Libor +2.5%
with a 5 year maturity to be payable in one installment at maturity with semi-annual interest payment.
The credit agreements obtained in 2016 and 2017, mentioned above, were paid on May 23, 2018.

As of December 31, 2019, the outstanding balance of the credit agreements is ThUS$591,933.

7
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Bond issued:

On May 10, 2005, the Corporation issued and placed bonds in the domestic market for a nominal
amount of UF 6,900,000 of a single series labeled “Series B”, which consists of 6,900 bonds for UF
1,000 each. These bonds are payable in a single installment on April 1, 2025, at an annual interest rate
of 4% and semi-annual interest payments.

On September 21, 2005, the Corporation issued and placed bonds in the U.S. market under Rule 144-
A and Regulation S, for a nominal amount of ThUS$500,000. These bonds are payable in a single
installment on September 21, 2035, at an annual interest rate of 5.6250% and semi-annual interest
payments.

On October 19, 2006, the Corporation issued and placed bonds in the U.S. market under Rule 144-A
and Regulation S, for a nominal amount of ThUS$500,000. These bonds are payable in a single
installment on October 24, 2036, at an annual interest rate of 6.15% and semi-annual interest
payments.

On January 20, 2009, the Corporation issued and placed bonds in the U.S. market under Rule 144-A
and Regulation S, for a nominal amount of ThUS$600,000. These bonds are payable in a single
installment on January 15, 2019, at an annual interest rate of 7.5% and semi-annual interest payments.
On August 3, 2017, principal was paid for an amount of ThUS$333,155.

On November 4, 2010, the Corporation issued and placed bonds in the U.S. market under Rule 144-A
and Regulation S, for a nominal amount of ThUS$1,000,000. These bonds are payable in a single
installment on November 4, 2020, at an annual interest rate of 3.75% and semi-annual interest
payments. On August 3, 2017 and February 6, 2019, principal was paid for an amount of
ThUS$414,763 and ThUS$183,051 respectively.

On November 3, 2011, the Corporation issued and placed bonds in the U.S. market under Rule 144-
A and Regulation S, for a nominal amount of ThUS$1,150,000. These bonds are payable in a single
installment on November 4, 2021, atan annual interest rate of 3.875% and semi-annual interest
payments. On August 3, 2017 and February 6, 2019, principal was paid for an amount of
ThUS$665,226 and ThUS$247,814 respectively.

On July 17, 2012, the Company issued and placed bonds in the U.S. market under Rule 144-A and
Regulation S, for a nominal amount of TRUS$2,000,000. These bonds are payable in two installments
(i) the first tranche on July 17, 2022 in the amount of US$1,250,000 at a 3% annual interest rate. On
August 22, 2017, and February 6, 2019, principal was paid in the amounts of ThUS$412,514 and
ThUS$314,219, respectively, and (ii) the other tranche matures on July 17, 2042 and is in the amount
of ThUS$750,000 at an annual interest rate of 4.25%.

73
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

On August 13, 2013, the Corporation issued and placed bonds in the U.S. market, under Rule 144-A
and Regulation S, for a nominal amount of ThUS$750,000, payable in a single installment on August
13, 2023, at an annual interest rate of 4.5% and semi-annual interest payments. On August 22, 2017,
February 12 and February 26, 2019, principal in the amounts of ThUS$162,502, ThUS$228,674 and
ThUS$270 respectively, was paid.

On October 18, 2013, the Corporation issued and placed bonds in the U.S. market, under Rule 144-A
and Regulation S, for a nominal amount of ThUS$950,000, payable in a single installment on October
18, 2043, at an annual interest rate of 5.625% and semi-annual interest payments.

On July 9, 2014, the Corporation issued and placed bonds in the international financial markets, under
Rule 144-A and Regulation S, for a nominal amount of EUR$600,000,000, payable in a single
installment on July 9, 2024, at an annual interest rate of 2.25% and annual interest payments.

On November 4, 2014, the Corporation issued and placed bonds in the U.S. market, under Rule 144-A
and Regulation S, for a nominal amount of ThUS$980,000, payable in a single installment on
November 4, 2044, at an annual interest rate of 4.875% and semi-annual interest payments.

On September 16, 2015, the Corporation issued and placed bonds in the U.S. market, under Rule 144-
A and Regulation S, for a nominal amount of ThUS$2,000,000, payable in a single installment on
September 16, 2025, at an annual interest rate of 4.5% and semi-annual interest payments. On August
22, 2017 and February 12, 2019, principal was paid for an amount of ThUS$378,655 and
ThUS$552,754 respectively.

On August 24, 2016, the Corporation issued and placed bonds in the local market for a nominal
amount of UF10,000,000 of single series labeled “Series C”, which consists of 20,000 bonds for UF500
each. These bonds are payable in a single installment on August 24, 2026, at an annual interest rate of
2.5% and semi-annual interest payments.

On July 25, 2017, the Corporation made an offer in New York to buy its bonds issued in dollars with
maturities between 2019 and 2025, repurchasing US$2,367 million.

On August 1, 2017, the Corporation issued and placed bonds on the North American market, under
standard 144-A and Regulation S, for a total, nominal, amount of ThUS$2,750,000. ThUS$1,500,000,
with an annual coupon rate of interest of 3.625% and semi-annual interest payments which will mature
on August 1, 2027, while ThUS$1,250,000, with an annual coupon of 4.5% and semi-annual interest
payments, will mature on August 1, 2047.

These operations allowed optimizing the debt maturity profile of Codelco. As a result of these
transactions, 86% of the funds from the new issue (US$2,367 million) were used to refinance old debt.
The average interest rate of refinanced funds decreased from 4.36% to 4.02%.

The effect recognized in profit and loss associated with this refinancing was a charge of US$ 42 million
after tax.

74
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

On May 18, 2018, Codelco issued a bond for US$600 million with 30 year maturity in the market of
Formosa, Taiwan. The bond issued is denominated in US dollars, had a yield of 4.85% and a
prepayment option at the issue value that can be exercised from the fifth year onwards at its par value.

On January 28, 2019, the Corporation in New York made an offer to purchase its bonds issued in
dollars with maturities between 2020 and 2025, repurchasing US$1,527 millions.

Subsequently, on February 5, 2019, the Corporation issued and placed bonds in the North American
market, under Rule 144-A and Regulation S, for a total nominal amount of ThUS$1,300,000, which
maturity will be 5 February 2049 with a coupon of 4.375% per annum and interest payments on a semi-
annual basis.

The effect recognized in results associated with this refinancing was a charge of US$10 million after
taxes.

On July 22, 2019, the Corporation made a bond issue and placement, Regulation S, for a nominal
amount of AUD $ 70,000,000, whose maturity will be in a single installment on July 22, 2039, with a
coupon of 3.58% annual and interest payment annually.

On August 23, 2019, the Corporation made a bond issue and placement, Regulation S, for a nominal
amount of US$130,000,000, whose maturity will be in a single installment on August 23, 2029, with a
coupon of 2.869% annual and interest payment semiannually.

On September 30, 2019, the Corporation made an issue and placement of bonds in the North
American market, under rule 144-A and Regulation S, for a total nominal amount of TRUS$2,000,000
whose maturity will be, under one tranche, on September 30, 2029 corresponding to an amount of
ThUS$1,100,000 with a 3% annual coupon. The other tranche contemplates a maturity for January 30,
2050, corresponding to an amount of ThUS$900,000 with a coupon of 3.70% per year.

Along with this placement, Codelco launched a purchase offer, in which a repurchase amount of US$
152 million was reached. The effect recognized in results associated with this refinancing was a charge
of US$2 million after taxes.

As of December 31, 2019 and 2018, the Corporation is not required to comply with any financial
covenants related to borrowings from financial institutions and bond obligations.

Financial debt commissions and expenses: Transaction costs incurred in obtaining financial
resources are deducted from the loan proceeds and are amortized using the effective interest rate.

Finance leases: Leasing operations are generated by contracts, mainly for buildings and machinery.

75
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

As of December 31, 2019, the details of loans from financial institutions and bond obligations are as follows:

1213112019
Principal Nominal Current | NO”
rincipal lomina urren
A A Loans with instal maturity | Mierest | a P . vee ofamortizat Payment e | Effective | current
uni Institution laturi urrency | Amoun e of amortization nteres alance
Number ‘Y — [financial entities Y late y ye Interest Rao [“erestRate balance
ate

THUS$ | THUS$

97.036.000-K | Chile Bilateral Credit — [Santander Chile 3/27/2020 | Floating | US$ |100,000,000| Maturty Semiannual | 2.36% | 2.36% | 100,597 –
97.018.000-1 | Chile Bilateral Credit — [Scotiabank Chile 9/7/2020 | Floating | US$ |100,000,000| Maturity Semizannual | 2.34% | 2.34% | 100,753 –
97.018.000-1 | Chile Bilateral Credit — [Scotiabank Chile 9/14/2020 | Floating | US$ | 65,000,000| Maturity Semizannual | 2.40% | 2.40% | 65473 –
97.018.001 | Chile Bilateral Credit — [Scotiabank Chile 12/20/2020 | Floating | US$ |300,000,000| Maturiy Semizannual | 2.63% | 2.63% | 300,241 –
Foreign USA Bilateral Credit — |MUFG Bank Ltd 9/30/2021 | Floating | US$ |250,000,000| Maturity Semizannual | 2.96% | 3.08% 3,409 | 249,690
Foreign USA Bilateral Credit. [Export Dev Canada 11/3/2021 | Floaing | US$ |300,000,000| Maturiyy Semizannual | 2.54% | 2.72% 1,205 | 299,265
Foreign Cayman Island | Bilateral Credit |[Scotabank 8 Trust (Cayman) Ltd | 4/13/2022 | Floating | US$ |300,000,000| Maturity Quarterly | 2.65% | 2.86% 1,701 | 298,834
Foreign Vapan Bilateral Credit — [Japan Bank International Cooperation. | 5/24/2022 | Floating | US$ | 224,000,000| Halfy early principal payments fom 2015 to the present. | Semizannual | 2.34% | 2.53% | 32,187 | 47,833
Foreign USA Bilateral Credit. [Export Dev Canada 7/17/2022 | Floating | US$ | 300,000,000| Matuity Semizannual | 2.83% | 2.95% 3,774 | 299,550
Foreign Panama Bilateral Credit. [Banco Latinaamericano de Comercio | 12/18/2026 | Floating | US$ | 75,000,000| Maturity Semizannual | 3.10% | 3.28% 77 74401
Foreign USA Bilateral Credit. [Export Dev Canada 10/25/2028 | Floating | US$ | 300,000,000| Maturiy Semizannual | 3.40% | 3.52% 4,505 | 298,390
Foreign USA Bilateral Credit. [Export Dev Canada 7/25/2029 | Floating | US$ | 300,000,000| Matuity Semizannual | 3.42% | 3.62% 4,393 | 296,200
Foreign Holland Bilateral Credit — [Oriente Copper Netherlands B.V. — |11/26/2032| Fixed | US$ |874,959,000| Semi-annual Semizannual | 3.25% | 5.42% | 47,829 | 544,104
TOTAL 666,144 | 2,408,267
Principal Current Non-current

Taxpayer Country Maturity Interest Rate Currency Amount Type of Pay ment of Nominal Effective balance balance
1D Number amortization interest Interest Rate | Interest Rate
Thus$ Thuss$

144-A REG.S Luxembourg 11/4/2020 Fixed US$ 1,000,000,000 At Maturity 3.75% 3.89% 396,742 –
144-A REG.S Luxembourg 11/4/2021 Fixed US$ 1,150,000,000 At Maturity 3.88% 4.02% 1,377 226,416
144-A REG.S Luxembourg 7/17/2022 Fixed US$ 1,250,000,000 At Maturity Semi-annual 3.00% 3.16% 4,978 410,882
144-A REG.S Luxembourg 8/13/2023 Fixed US$ 750,000,000 At Maturity Semi-annual 4.50% 4.74% 4,627 332,188
144-A REG.S Luxembourg 7/9/2024 Fixed EURO 600,000,000 At Maturity Annual 2.25% 2.48% 7,236 666,384
BCODE-B Chile 4/1/2025 Fixed U.F 6,900,000 At Maturity 4.00% 3.24% 2,595 270,374
144-A REG.S Luxembourg 9/16/2025 Fixed US$ 2,000,000,000 At Maturity 4.50% 4.75% 14,003 1,055,236
BCODE-C Chile 8/24/2026 Fixed U.F 10,000,000 At Maturity 2.50% 2.48% 3,292 394,774
144-A REG.S Luxembourg 8/1/2027 Fixed US$ 1,500,000,000 At Maturity 3.63% 4.20% 22,607 1,443,875
REG.S Luxembourg 8/23/2029 Fixed US$ 130,000,000 At Maturity 2.87% 2.98% 1,328 128,808
144-A REG.S Luxembourg 9/30/2029 Fixed US$ 1,100,000,000 At Maturity Semi-annual 3.00% 3.14% 8,385 1,087,092
REG.S Luxembourg 11/7/2034 Fixed HKD 500,000,000 At Maturity Annual 0.00% 0.00% 275 63,593
144-A REG.S Luxembourg 9/21/2035 Fixed US$ 500,000,000 At Maturity Semi-annual 5.63% 5.78% 7,804 492,115
144-A REG.S Luxembourg 10/24/2036 Fixed US$ 500,000,000 At Maturity Semi-annual 6.15% 6.22% 5,713 496,544
REG.S Luxembourg 7/22/2039 Fixed AUD 70,000,000 At Maturity Annual 0.00% 0.00% 783 48,519
144-A REG.S Luxembourg 7/17/2042 Fixed US$ 750,000,000 At Maturity Semi-annual 4.25% 4.41% 14,465 733,450
144-A REG.S Luxembourg 10/18/2043 Fixed US$ 950,000,000 At Maturity Semi. 5.63% 5.76% 10,804 933,573
144-A REG.S Luxembourg 11/4/2044 Fixed US$ 980,000,000 At Maturity 4.88% 5.01% 7,481 961,425
144-A REG.S Luxembourg 8/1/2047 Fixed US$ 1,250,000,000 At Maturity 4.50% 4.73% 23,387 1,205,925
144 – REG.S Luxembourg 5/18/2048 Fixed US$ 600,000,000 At Maturity 4.85% 4.91% 3,438 594,487
144-A REG.S Luxembourg 2/5/2049 Fixed US$ 1,300,000,000 At Maturity Semi. 4.38% 4.97% 22,874 1,182,292
144-A REG.S Luxembourg 1/30/2050 Fixed US$ 900,000,000 At Maturity Semi-annual 3.70% 3.78% 8,393 889,406
TOTAL 572,587 13,617,358

Nominal and effective interest rates presented above correspond to annual rates.

76
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

As of December 31, 2018, the details of loans from financial institutions and bond obligations are as follows:

TUSTA0TE
, Principal . Current
Taxpayer 1D Loans with financial . e Paymentof | Nominal | Effective Non:current balance
Number Country entities Institution Maturity Interest Rate | Currency Amount Type of amortization Interest Interest Rate|Interest Rate! balance
Thus$ Thus$
97.018.001 [Che Bilatera Credit [Scofabank Call 12/20/2019 | Floaing | US$ 300,000,000] Maturiy Semiannua | 360% | 374% 300,059 –
Foreign USA Bilateral Credit [MUFG Bank Ltd algo/2021 | Floaing | US$ 250,000,000] Maturiy Semiannual | 327% | 337% 3,768 249,579
Foreign USA Bilateral Credit. — [ExportDew Canada 1118/2021 | Floaing | US 300.000.000] Mati Semisannual | 344% | 362% 1,604 298,875
Foreign Cayman island — | Bilateral Credit — [Scotiabank 8 Trust (Cayman) Ltd 4/18/2022 | Floaing | USS 300.000.000] Maturiy Quaery | 3.09% | 330% 1,980 298,401
Foreign USA Bilateral Credit. — [ExportDew Canada 77/2022 | Floaing | US$ 300,000,000] Maturity Semisannual | 338% | 348% 1,915 299.432
Foreign USA Bilateral Credit. — [ExportDew Canada 10/25/2028 | Floating | US 300.000.000] Maturiy Semisannual | 396% | 409% 2212 298,250
Foreign Vapan Bilateral Credit [MUFG Bank Ltd 5/24/2029 | Floaing | US$ 96,000,000] Haltyeary principal payments fom 2015 o he present. Semiannual | 344% | 384% 12,016 –
Foreign Vapan Bilateral Credit. Japan Bank Intematonal Cooperation 5/24/2022 | Floaing | US$ 224,000,000| Haltyeary principal payments fom 2015 to he present. Semiannual | 334% | 354% 32,363 79674
Foreign Holand Bilateral Credit. — [Oriente Copper Nethertands B.V, 11/26/2082. | Fixed | US$ 874,959,000| Semisamual Semisannual | 325% | 542% 48490 582,867
Foreign Gemeny Credit Line HSBC Tnkaus 6 Floaing | Euo 125% | 125% 408 –
Oherinsttions 56 –
TOTAL 404871 2,107,078
roxpayer Principal Nominal | Efecive | — Current Non-current
on P A County Maturity — | Interest Rate| Currency Amount Type ofamortizaion | Paymentofinterest | Interest | Interest balance balance
umber
Rate Rate ThUS$ ThUS$
144-A REG.S Luxembourg 1/15/2019 Fixed US$ 00,000,000 AtMaturily Semi-annual 7.50%| 7.78% 276,061 –
144-A REG.S Luxembourg 11/4/2020 Fixed US$ 1,000,000,000 At Maturity Semi-annual 3.75%| 3.97% 3,456 582,989
144-A REG.S Luxembourg 11/4/2021 Fixed US$ 1,150,000,000 At Maturity Semi-annual 3.88%| 4.06% 2,958 482,430
144-A REG.S Luxembourg 7/17/2022 Fixed US$ 1,250,000,000 At Maturity Semi-annual 3.00%| 3.17% 11,538 832,748
144-A REG.S Luxembourg 8/13/2023 Fixed US$ 750,000,000 At Maturity Semi-annual 4.50%| 4.75% 10,058 581,548
144-A REG.S Luxembourg 7/09/2024 Fixed EUR 600,000,000 At Maturity Annual 2.25%| 2.48% 7,404 678,446
BCODE-B Chile 4/1/2025 Fixed UF. 6,900,000 At Maturity Semi-annual 4.00%| 3.24% 2,737 285,436
144-A REG.S Luxembourg 9/16/2025 Fixed US$ 2,000,000,000 At Maturity Semi-annual 4.50%| 4.77% 21,364 1,596,926
BCODE-C Chile 8/24/2026 Fixed UF. 10,000,000 At Maturity Semi-annual 2.50%| 2.48% 3,455 416,715
144-A REG.S Luxembourg 1/8/2027 Fixed US$ 1,500,000,000 At Maturity Semi-annual 3.63%| 4.20% 22,607 1,437,938
144-A REG.S Luxembourg 9/21/2035 Fixed US$ 00,000,000 At Maturity Semi-annual 5.63%| 5.78% 7,925 491,814
144-A REG.S Luxembourg 10/24/2036 Fixed US$ 00,000,000 At Maturity Semi-annual 6.15%| 6.22% 5,998 496,430
144-A REG.S Luxembourg 7/17/2042 Fixed US$ 750,000,000 At Maturity Semi-annual 4.25%| 4.41% 14,638 733,027
144-A REG.S Luxembourg 10/18/2043 Fixed US$ 950,000,000 At Maturity Semi-annual 5.63%| 5.76% 10,864 933,256
144-A REG.S Luxembourg 11/4/2044 Fixed US$ 980,000,000 At Maturity Semi-annual 4.88%| 5.01% 7,522 961,050
144-A REG.S Luxembourg 8/1/2047 Fixed US$ 1,250,000,000 At Maturity Semi-annual 4.50%| 4.73% 23,387 1,205,156
REG.S Taiwan 5/18/2048 Fixed US$ 00,000,000 At Maturity Semi-annual 4.85%| 4.91% 3,457 594,398
TOTAL 435,429 | 12,310,307

Nominal and effective interest rates presented above correspond to annual rates.

The undiscounted amounts that the Corporation will have to disburse to settle the obligations with financial institutions, are as follows:

77

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

12/31/2019 Current Non-current
Debtor’s Name Currency | Effective interest rate No Payments of Interest | Less than 90 days | More than 90 days | Currenttotal | 1to3years | 3to5years | More than 5 years | Non-current total
Santander Chile US$ 2.36% 2.36% Semiannual 101,165 101,165 – – – –
Scotiabank Chile US$ 2.34% 2.34% Semi-annual 101,182 -| 101,182 – – – –
Scotiabank Chile US$ 2.40% 2.40% Semi-annual 65,790 – 65,790 – – – –
Scotiabank Chile US$ 2.63% 2.63% Semi-annual – 304,054| 304,054 – – – –
MUFG Bank LTD US$ 3.06% 2.96% Semi-annual 3,840 3,737 7,577 261,212 – – 261,212
Export Dev Canada US$ 2.72% 2.54% Semi-annual – 7,757 7,757 307,715 – – 307,715
Scotiabank 8 Trust (Cayman) Ltd US$ 2.86% 2.65% Quarterly 1,988 6,053 8,041 312,062 – – 312,062
Japan Bank International Cooperaton| US$ 2.53% 2.34% Semi-annual – 33,720 33,720 49,137 – – 49,137
Export Dev Canada US$ 2.95% 2.83% Semi-annual 4,411 4,293 8,704 317,291 – – 317,291
Export Dev Canada US$ 3.52% 3.40% Semi-annual 5,213 5,156 10,369 20,683 20,711 346,607 388,001
Export Dev Canada US$ 3.62% 3.42% Semi-annual 5,244 5,187 10,431 20,804 20,833 351,897 393,534
Banco Latinoamericano de Comercio | US$ 3.28% 3.10% Semi-annual – 2,380 2,380 4,722 3,545 80,886 89,153
BONO 144-A REG.S 2020 US$ 3.89% 3.75% Semi-annual – 409,690| 409,690 – – – –
BONO 144-A REG.S 2021 US$ 4.02% 3.88% Semi-annual – 8,796 8,796 235,777 – – 235,777
BONO 144-A REG.S 2022 US$ 3.16% 3.00% Semi-annual 6,187 6,187 12,374 437,224 – – 437,224
BONO 144-A REG.S 2023 US$ 4.74% 4.50% Semi-annual 7,535 7,535 15,070 30,138 349,940 – 380,078
BONO 144-A REG.S 2025 US$ 4.75% 4.50% Semi-annual 24,044 24,044 48,088 96,174 96,174 1,116,688 1,309,036
BONO 144-A REG.S 2027 US$ 4.20% 3.63% Semi-annual 27,188 27,188 54,376 108,750 108,750 1,663,125 1,880,625
REG.S 2029 US$ 2.98% 2.87% Semi-annual 1,865 1,865 3,730 7,459 7,459 148,649 163,567
BONO 144-A REG.S 2029 US$ 3.14% 3.00% Semi-annual 16,500 16,500 33,000 66,000 66,000 1,265,000 1,397,000
BONO 144-A REG.S 2035 US$ 5.78% 5.63% Semi-annual 14,063 14,063 28,126 56,250 56,250 809,375 921,875
BONO 144-A REG.S 2036 US$ 6.22% 6.15% Semi-annual – 30,750 30,750 61,500 61,500 869,000 992,000
BONO 144-A REG.S 2042 US$ 4.41% 4.25% Semi-annual 15,938 15,938 31,876 63,750 63,750 1,323,750 1,451,250
BONO 144-A REG.S 2043 US$ 5.76% 5.63% Semi-annual – 53,438 53,438 106,875 106,875 1,965,313 2,179,063
BONO 144-A REGS 2044 US$ 5.01% 4.88% Semi-annual – 47,175 47,775 95,550 95,550 1,935,500 2,126,600
BONO 144-A REG.S 2047 US$ 4.73% 4.50% Semi-annual 28,125 28,125 56,250 112,500 112,500 2,543,750 2,768,750
BONO 144 REG.S 2048 US$ 4.91% 4.85% Semi-annual – 29,100 29,100 58,200 58,200 1,283,850 1,400,250
BONO 144-A REG.S 2049 US$ 4.97% 4.38% Semi-annual 28,438 28,438 56,876 113,750 113,750 2,693,438 2,920,938
BONO 144-A REG.S 2050 US$ 3.78% 3.70% Semi-annual 11,100 22,261 33,361 66,782 66,782 1,745,911 1,879,476
Oriente Copper Netherlands B.V. US$ 5.42% 3.25% Semi-annual 72,705 72,705 141,137 135,320 537,640 814,097
Total TRUS$ 469,816 1,216,735| 1,686,551] 3,151,442] 1,543,889 20,680,379 25,375,711
[BONO BCODE-B 2025 UF] 3.24% [4.00% Semi-annual 138,000 138,000] 276,000 552,000 552,000 7,038,000 8,142,000
[BONO BCODE-C 2026 | 2.48% [250% Semi-annual 124,228 124,228] 248,457 496,913 496,913 10,496,914 11,490,740
Tolal UF. 262,228 262,228] —524,457| 1,048,913] 1,048,913 17,534,914 19,632,740
Subtotal ThUS$ 9,915 9,915 19,830 39,661 39,660 662,997 742,318
[BONO 144-A REG.S 2024 EURO | 2.48% [2.25% Annual – 13.500,000| 13,500,000| 27,000,000| 27,000,000 600.000,000| —654,000,000
Subtotal ThUS$ – 15,138 15,138 30,276 30,276 672,798 733,350
[REG.s 2039 AUD | 3.65%] 3.58% Annual – 2.506.000| 2.506,000| 5/012,000| 5,012,000 107,590,000| —117.614,000
Subtotal ThUS$ – 1,755| 1,755 3,509 3,509 75,332 82,350
[REG.S 2034 HKD | 2.92% | 2.64% Annual – 14,238,904| 14,238,904| 28,400,000| 28,438,904 642.077,808| —698,916,712
Subtotal ThUS$ – 1,829 1,829 3,648 3,653 82,468 89,769
Total TRUS$ 479,731 1,245,372] 1,725,103] 3,228,536| 1,620,987 22,173,974] 27,023,498

Nominal and effective interest rates presented above correspond to annual rates.

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

12/31/2018 Current Non-current
Creditor Name Currency Eee es o lerest Payments of Interest el so MA so Currenttotal 1103 years 3to5 years | More than 5 years| Non-current total
Scotiabank Chile US$ 3,74% 3,60% Semi-annual – 310,893 310,893 – – – –
Bank of Tokyo Mitsubishi Ltd. US$ 3,37% 3,27% Semi-annual 4,176] 4,108 8,284| 270,701 – – 270,701
Export Dev Canada US$ 3,62% 3,44% Semi-annual – 10,395 10,395| 320,934 – – 320,934
Scotiabank 8. Trust (Cayman) Ltd US$ 3,30% 3,09% Quarterly 2,340] 7,099| 9,439] 18,801 304,578 – 323,379
Export Dev Canada US$ 3,48% 3,38% Semi-annual – 10,279 10,279| 20,586| 310,251 – 330,837
Export Dev Canada US$ 4,09% 3,96% Semi-annual – 12,053| 12,053 24,139 24,106 360,330 408,575
MUFG Bank Ltd US$ 3,84% 3,44% Semi-annual > 12,205 12,205 – > – >
Japan Bank International Cooperation US$ 3,54% 3,34% Semi-annual – 35,496| 35,496 67,793| 16,268| – 84,061
BONO 144-A REG.S 2019 US$ 7,78% 7,50% Semi-annual 276,852 – 276,852 – > – >
BONO 144-A REG.S 2020 US$ 3,97% 3,75% Semi-annual > 21,946| 21,946 607,183 > – 607,183
BONO 144-A REG.S 2021 US$ 4,06% 3,88% Semi-annual > 18,785 18,785 522,344 > – 522,344
BONO 144-A REG.S 2022 US$ 3,17% 3,00% Semi-annual 12,562 12,562 25,124 50,249] 862,611 – 912,860
BONO 144-A REG.S 2023 US$ 4,75% 4,50% Semi-annual 13,219 13,219 26,438 52,875| 640,373 – 693,248
BONO 144-A REG.S 2025 US$ 4,71% 4,50% Semi-annual 36,480 36,480| 72,960 145,922] 145,922] 1,767,277 2,059,121
BONO 144-A REG.S 2027 US$ 4,20% 3,63% Semi-annual 27,188 27,188| 54,376 108,750| 108,750| 1,717,500 1,935,000
BONO 144-A REG.S 2035 US$ 5,78% 5,63% Semi-annual 14,063 14,063 28,126 56,250| 56,250 837,500 950,000
BONO 144-A REG.S 2036 US$ 6,22% 6,15% Semi-annual > 30,750| 30,750 61,500] 61,500 899,750 1,022,750
BONO 144-A REG.S 2042 US$ 4,41% 4,25% Semi-annual 15,938 15,938 31,876 63,750| 63,750 1,355,625 1,483,125
BONO 144-A REG.S 2043 US$ 5,76% 5,63% Semi-annual > 53,438| 53,438 106,875| 106,875| 2,018,750| 2,232,500]
BONO 144-A REG.S 2044 US$ 5,01% 4,88% Semi-annual > 47,775| 47,775] 95,550] 95,550 1,983,275 2,174,375|
BONO 144-A REG.S 2047 US$ 4,73% 4,50% Semi-annual 28,125 28,125| 56,250 112,500| 112,500] 2,600,000] 2,825,000]
REG.S. 2048 US$ 4,91% 4,85% Semi-annual > 29,100] 29,100 58,200| 58,200 1,312,950 1,429,350
Oriente Copper Netherlands B.V. US$ 5,42% 3,25% Semi-annual – 72,705| 72,705 141,137 135,320| 537,640 814,097
Total TRUS$ 430,943 824,602 1,255,545 2,906,039] 3,102,804] 15,390,597 21,399,440
BONO BCODE-B 2025 UE. 3,24%] 4,00% | Semi-annual 138,000] 138,000] 276,000 552,000 552,000 7,314,000] 8,418,000
BONO BCODE-C 2026 UE. 2,48%] 2,50%] Semi-annual 124,228| 124,228| 248,457 496,913| 496,913 10,745,370] 11,739,197]
Total U.F. 262,228 262,228 524,457 1,048,913 1,048,913 18,059,370] 20,157,197
Subtotal TRUS$ 10,404] 10,404 20,808 41,617 41,617| 716,526 799,760
[ BONO 144-A REG. S 2024 [ EUR [ 2,48%) 2,25%] Annual 13,500,000] 13,500,000] 27,000,000] 27,000,000 613,500,000, 667,500,000|
Total EUR 13,500,000] 13,500,000] 27,000,000] 27,000,000 613,500,000, 667,500,000|
Subtotal TRUS$ 15,443 15,443 30,885| 30,885 701,783 763,553
Total TRUS$ 441,347 850,449 1,291,796 2,978,541 3,175,306 16,808,906 22,962,753

Nominal and effective interest rates presented above correspond to annual rates.

79

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The present value of future lease payments are detailed in the following table:

12/31/2019 12/31/2018
Leases Gross Interest Present Value Gross Interest Present Value
ThUS$ ThUS$ ThUS$ ThUs$ ThUs$ ThuS$
Less than 90 days 39,668 (4,557) 35,111 6,092 (1,735) 4,357
Between 90 days and 1 year 105,315 (12,665) 92,650 21,529 (5,186) 16,343
Between 1 and 2 years 107,218 (12,248) 94,970 23,385 (5,943) 17,442
Between 2 and 3 years 77,753 (9,881) 67,872 20,079 (4,807) 15,272
Between 3 and 4 years 60,078 (6,813) 53,265 13,628 (3,699) 9,929
Between 4 and 5 years 32,384 (4,780) 27,604 20,756 (2,812) 17,944
More than 5 years 70,857 (9,458) 61,399 35,126 (8,574) 26,552
Total 493,273 (60,402) 432,871 140,595 (32,756) 107,839

The expense related to short-term leases, low-value assets and variable leases not included in the
measurement and or amortization of lease liabilities for year ended December 31, 2019 is presented in the
following table:

1/1/2019
Lease expense 12/31/2019
TRUS$
Short-term leases 84,252
Low value leases 5,684
Variable lease pay ments not included in the initial measurement or remeasurement of 1,488,400
liabiliies (ex cluding, where applicable, changes in indices or rates)
TOTAL 1,578,345

The operating lease expense recognized in the statement of comprehensive income for the year ended
December 31, 2018 totaled ThUS$191,311.

The table below details changes in CODELCO’s financing activities in the statement of cash flow,
including both cash and non-cash changes for the year ended December 31, 2019 and 2018:

Changes that do not represent cash flow
Initial Balance at Flows of cash Financial Cost Adjustment | Effective Interest | — Other Final Balance at
Liabilities forfinancing activities 41112019 From Used Total (m Exchange aceretion/amortiza 1213112019
US$ US$, MUS$ US$, US$ US$ US$ us$ US$ us$

Loans wih financial instiuions 2,511,949 | — 840,000] — (386625)| 453,375 104,592 – – 1,606 2.889 3.074,41
Bond Obiigations 12,745,736 | 3543,190 | (2610,321)| 982878 591,920 (45.137) – (85,452) – 14,189,945
‘Obligatons for coverage 116,132 – (21:167)| (21:67) 21,556 13,142 21.515 – 588 157,826
Paid Dividens – – – – – – – –

Financial assets for hedge derivaives (107,700) – – – 31,438 (6,322) – – (82,584)
Leases 107,839 (168181) (148481) 31.416 (18,114) – 459,911 432,871
Capital contibution – 400,000 – 400,000 – – – – –

Other 64,343 – (15488) (75483) 51,082 – – – 18,922 58,864
Total liabilities from financing activities 15.438,20 | 4,783,199 | (3241,777)[ 1,541,422 800,566 (18,671) 21,253 (83,846) 482,310 17,831,333

80
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Changes that do not represent cash flow
Initial Balance at Flows of cash Financial Cost] Adjustment | Effective Interest ]— Other — | Final Balance at
Liabilities forfinancing activities 4/1/2018 From Used Total (1 Exchange aceretion/amortiza 12/31/2018
US$ THUS$ US$ THUS$ US$ LS US$ LS US$ US$

Loans wih financial insttuions 2460,384 | — 300.000] (333.027) (38027) 84,502 – – 2,511,949
Bond Obiigaions 12249.406 | 600.00| (541,341)| 58,659 543,874 (101,299) – (4,904) 12,745,736
Obligatons for coverage 83,896 (18,930)| (18,930) 20.070 35,884 (4,788) 116,132
Paid Dividens – (602.461) (602.461)| – – – –
Financial assets for hedge derivaives (137,544) – – 66,177 (86,333) (107,700)|
Leases 102,711 (27,130) (27.130) 2,774 2,645 – 26,889 107,839
Capital contibuion 600,000 600,000 – – – –
Other 69,813 (e9200)| (99200) 82,886 – – 10.844 64,343
Total liabilities from financing activities 14,828,666 | 1,500.00 | (1,622/089)| (122080) 734,196 3,407 (41,121) (4,904) 37,683 15,430,299

(1) The finance costs consider the capitalization of interest, which for the year ended December 31,
2019 and 2018, amounts to TRUS$367,548 and ThUS$311,399 respectively.

13. Fair Value of financial assets and liabilities

The carrying amount of financial assets is a reasonable approximation to their fair value, therefore, no
additional disclosures are required in accordance with IFRS 7 with respect thereto.

Regarding financial liabilities, the following table shows a comparison as of December 31, 2019 between
the carrying amount and the fair value of financial liabilities other than those whose carrying amount is a
reasonable approximation of fair value.

Comparison value book vs fair value | Accounting treatment for Carrying amount Fair value
as of December 31, 2019 valuation ThUS$ THuS$
Financial liabilities:
Bond Obligations Amortized cost 14,189,945 15,522,523

14. Fair value hierarchy

The estimated fair value for the Corporation’s portfolio of financial instruments is based on valuation
techniques and observable inputs. Considering the hierarchy of the data used in these valuation
techniques, the assets and liabilities measured at fair value can be classified into the following levels:

+» Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.
+ Level 2: Inputs other than quoted prices included within Level 1 that are observable for the assets or

liabilities, either directly (i,e, as prices) or indirectly (i,e, derived from prices).
+ Level 3: Inputs are significant unobservable inputs for the asset or liability.

81

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The following table presents financial assets and liabilities measured at fair value as of December 31,
2019:

Financial instruments measured at fair 12/31/2019
value Level 1 Level 2 Level 3 Total
ThUus$ ThUS$ ThUus$ ThUus$

Financial Assets

Provisional price sales contracts – 723,619 – 723,619
Cross Currency Swap – 82,584 – 82,584
Mutual fund units 2,158 – – 2,158
Metal futures contracts 1,840 – – 1,840
Financial Liabilities

Metal futures contracts 1,801 857 – 2,658
Cross Currency Swap – 157,825 157,825

There were no transfers between the different levels during the year ended December 31, 2019.
15. Trade and other payables

The detail of trade and other current payables as of December 31, 2019 and 2018, is as follows:

Currents
Items 12/31/2019 12/31/2018
ThUs$ ThUS$
Trade pay ables 1,150,047 1,317,623
Payables to employees 8,390 21,561
Withholdings 113,147 72,681
Withholding taxes 76,387 60,621
Other payables 72,944 74,098
Total 1,420,915 1,546,584

82
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

16. Other provisions

The detail of other current and non-current provisions as of December 31, 2019 and 2018, is as follows:

Current Non-current

Other Provisions 12/31/2019 | 12/31/2018 | 12/31/2019 | 12/31/2018

THUSS THUS$ THUSS THUSS$
Sales-related provisions (1) 2,932 2,692 –
Operating (2) 260,973 233,277
Law No. 13196 109,643 93,309 – –
Other provisions 128,429 51,771 24,097 20,153
Onerous Contract (3) 195 3,200 81 4,534
Decommissioning and restoration (4) – 2,016,625 1,506, 162
Legal proceedings – 49,684 69,334
Total 502,172 384,249 2,090,487 1,600,183

(1) Corresponds to a sales-related accruals, which includes charges for freight, loading, and unloading

that were not invoiced at the end of the period.
(2) Corresponds to a provision for customs duties, freight on purchases, electricity, among others.

(3) Corresponds to a provision recognized for an onerous contract with Copper Partners Investment
Company Ltd, See Note 29 b).

(4) Corresponds to the provision for future decommissioning and site restoration costs primarily related to
tailing dams, closures of mine operations and other mining assets. The amount of the provision is the
present value of future expected cash flows discounted at a pre-tax rate of 1.05% for the obligations in

Chilean currency and 1.86% for the obligations in U.S. dollar. Both, discount rates reflect the

corresponding assessments of the time value of money and the risks specific to the liability. The

discount rate does not reflect risks for which future cash flow estimates have been made. The discount
period varies between 9 and 54 years.

The Corporation determines and recognized this liability in accordance with the accounting policy
described in Note 2, letter p) on Significant Accounting Policies.
Changes in Other provisions, were as follows:

1/1/2019
12/31/2019
Changes Other Provisions, | Decommissioning . .
. Contingencies Total
non-current and restoration
ThUS$ ThUS$ ThUS$ ThUS$
Opening balance 24,687 1,506,162 69,334 1,600,183
Closing provision adjustment – 507,062 507,062
Financial expenses – 36,345 – 36,345
Pay ment of liabilities (406) – (21,366) (21,772)
Foreign currency translation (91) (32,160) (1,657) (33,908)
Provision increase (4,452) – – (4,452)
Other increases (decreases) 4,440 (784) 3,373 7,029
Closing Balance 24,178 2,016,625 49,684 2,090,487

83
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

1/1/2018
12/31/2018
Changes Other Provisions, | Decommissioning ¿. .
il Contingencies Total
non-current and restoration
ThUs$ ThUS$ ThUS$ ThUs$

Opening balance 26,524 1,636,695 48,583 1,711,802
Closing provision adjustment – (117,174) – (117,174)
Financial expenses – 34,754 – 34,754
Pay ment of liabilities – (827) (5,100) (5,927)
Foreign currency translation (3,617) (52,704) (3,574) (59,895)
Provision increase (3,200) – (3,200)
Other increases (decreases) 4,980 5,418 29,425 39,823
Closing Balance 24,687 1,506,162 69,334 1,600,183

17. Employee benefits
a. Provisions for post-employment benefits and other long term benefits

Provision for post-employment benefits mainly corresponds to employee severance indemnities and
medical care plans. The provision for severance indemnities recognizes the contractual obligation that
the Corporation has with its employees/retirees regardless of the reason for employee’s departure. The
provision for medical care plans recognizes the contractual obligation that the Corporation has with ¡ts
retirees/employees to cover their medical care costs.

Both long-term employee benefits are stated in the terms of employment contracts and collective
bargaining agreements as agreed to by the Corporation and its employees.

These defined benefit liabilities are recognized in the statement of financial position, at the present
value of the defined benefit obligation. The discount rate applied is determined by reference to the
market yields of government bonds in the same currency and estimated term of the post-employment
benefit obligations.

The defined benefit obligations are denominated in Chilean pesos, therefore the Corporation is
exposed to foreign exchange rate risk.

Actuarial gains and losses resulting from changes in actuarial assumptions and experience
adjustments are recognized in other comprehensive income and are not subsequently reclassified to
profit or loss.

For the year ended December 31, 2019, there were no significant changes in post-employment
benefits plans.

The following actuarial assumptions were used in the actuarial calculation of the defined benefit plans:

84
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Assumptions 12/31/2019 12/31/2018
Retirement plan Health plan Retirement plan Health plan
Annual Discount Rate 3.68% 3.68% 4.49% 4.93%
Voluntary Annual Turnover Rate for Retirement (Men) 5.00% 5.00% 4.00% 4.00%
Voluntary Annual Turnover Rate for Retirement (Women) 4.70% 4.70% 3.70% 3.70%
Salary Increase (real annual average) 3.26% – 4.08% –
Future Rate of Long-Term Inflation 3.00% 3.00% 3.00% 3.00%
Inflation Health Care – 5.05% – 5.05%
Mortality tables used for projections CB14-RV14 CB14-RV14 CB14-RV14 CB14-RV14
Average duration of future cash fows (years) 7.21 17.13 7.50 16.94
Expected Retirement Age (Men) 60 60 60 60
Expected Retirement Age (Women) 59 59 59 59

The discount rates correspond to the rates in the secondary market of government bonds issued in
Chile. The annual inflation corresponds to the long-term expectation set by the Central Bank of Chile.
The turnover rates were determined using the past three years of historical experience of the
Corporation’s employee departure behavior. The expected rate of salary increases has been estimated
using the long-term behavior of historical salaries paid by the Corporation. The mortality tables used
were those issued by the CMF, which are considered an appropriate representation of the Chilean
market given the lack of comparable statistical series to develop independent studies. The period over
which the obligation is being amortized corresponds to the estimate of the period over which the cash
flows will occur.

b. The detail of current and non-current provisions for employment benefits as of December 31, 2019 and
2018, is as follows:

Current Non-current
Accrual for employee benefits 12/31/2019 12/31/2018 12/31/2019 12/31/2018
THUS$ TRUS$ TRUS$ TRUS$

Employees’ collective bargaining agreements 181,040 204,040 – –
Employee termination benefit 21,904 27,247 704,877 802,260
Bonus 35,195 60,616 –
Vacation 143,971 183,628 – –
Medical care programs (1) 497 460 561,709 496,323
Retirement plans (2) 37,479 17,620 8,181 8,355
Other 15,479 16,423 8,590 8,582

Total 435,565 510,034 1,283,357 1,315,520

(1) Corresponds to a provision recognized for the obligations with health care institutions as agreed
with current and former employees.
(2) Correspond to the provision recognized for early retirement benefits provided to employees.

The reconciliation of the present value of the retirement plan and post-employment benefit obligation,
is as follows:

85
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

1/11/2019 1/1/2018
12/31/2019 12/31/2018
Movements
Retirement plan | Health plan |Retirement plan] Health plan
us$ Thus$ Thus$ Thus$
Opening balance 829,507 496,783 882,090 523,649
Service cost 51,086 39,980 72,821 9,962
Financial cost 15,512 9,290 15,966 11,520
Paid contributions (115,970) (44,275) (57,166) (39,779)
Actuarial (gains)/losses 4,828 93,889 16,576 30,200
Transfer from other benefits – 3,335 –
Subtotal 784,963 595,667 933,622 535,552
(Gains) Losses on foreign exchange rate (58,182) (33,461) (104,115) (38,769)
Final Total 726,781 562,206 829,507 496,783

The technical revaluation (actuarial gain/loss as defined under IAS 19) of the liability for compensation
benefits for years of service has been made, for the year ended December 31, 2019. Such was
charged to equity, which consists of an actuarial loss of ThUS$4,828, corresponding primarily to a
change in financial assumptions; this is broken down into a loss of ThUS$7,262 from the revaluation of
financial assumptions, specifically a profit of ThUS$11,513 from the revaluation of demographic
assumptions and a loss from experience of ThUS$9,079.

For the obligation generated by health benefit plans, an actuarial loss of ThUS$93,889 has been
determined, consisting primarily of an adjustment for experience loss made up of a loss to changes in
financial assumptions of ThUS$9,365; and an adjustment for experience loss of ThUS$84,524.

The balance of the defined benefit liability as of December 31, 2019, comprises a short term portion of
ThUS$21,904 and ThUS$497 for the termination indemnities plan and the medical care plan,
respectively. The expected amount of the defined benefit liability projected at December 31, 2020,
consists of ThUS$766,732 for the termination indemnities plan and ThUS$540,109 for the medical care
plan. The expected monthly average future disbursements related to defined benefit plans are of
ThUS$1,825 for termination indemnities and of ThUS$41 for medical care.

The following table sets forth the sensitivity analysis of the value of the each line item for a change in
estimates, respectively, from the medium (used in the estimate recorded) to the low and from the
medium to the high; the second to the last column represents the change between the low and medium
and the last column represents the change between the medium and the high:

86
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Severance Benefits for Years of Service Low Medium High Reduction Increase
Financial effect on interest rates 3.430% 3.680% 3.930% 1.25% 1.21%
Financial effect on the real increase in income 3.008% 3.258% 3.508% -1.07% 1.10%
Demographic effect of job rotations 4.470% 4.970% 5.470% 0.95% 0.74%
Demographic effect on mortality tables -25.00% CB14-RV14, Chile] 25.00% -0.04% 0.04%

Health Benefits and Other Low Medium High Reduction Increase
Financial effect on interest rates 3.430% 3.680% 3.930% 3.37% 3.28%
Financial effect on health inflation 4.550% 5.050% 5.550% 6.79% 7.64%
Demographic effect, planned retirement age 58 / 57 60 / 59 62/61 3.93% 3.91%
Demographic effect on mortality tables -25.00% CB14-RV14, Chile] 25.00% 11.91% 8.23%

c. Retirement benefits and conflict termination bonus

The Corporation under its operational optimization programs seeks to reduce costs and increase labor
productivity, and through the incorporation of modern technologies and/or best management practices
has established employee retirement programs by making corresponding modifications to employment
contracts or collective bargaining agreements, with benefits encouraging early retirement. The early
retirement plans are recognized as a liability and expense as the Corporation can no longer withdraw
the offer of those benefits.

As of December 31, 2019 and 2018, the retirement plan provision current balance was ThUS$37,479
and ThUS$17,620, respectively, while the non-current balance was ThUS$8,181 and ThUS$8,355,
respectively. The non-current portion is associated with the provision related to the term of the
collective bargaining process that Codelco’s management negotiated during the month of December
2012 with the employee unions of the Chuquicamata Division. The non-current amounts recognized
have been discounted using a discount rate equivalent to that used for calculating employee benefits
provisions and whose outstanding balances are part of the balances as of December 31, 2019 and
2018.

d. Employee benefits expenses

The employee benefit expenses recognized for the year ended December 31, 2019 and 2018, are as
follows:

Expense by Nature of Employee 11112019 111/2018
12/31/2019 12/31/2018
Benefits

TRUS$ TRUS$
Benefits – Short term 1,519,659 1,731,593
Benefits – Post employ ment 39,980 9,962
Benefits – Termination 100,747 54,594
Benefits by years of service 51,086 72,821
Total 1,711,472 1,868,970

87
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

18.

Equity

The Corporation’s total equity as of December 31, 2019 is ThUS$11,634,677 (ThUS$11,343,869 as of
December 31, 2018).

In accordance with article 6 of Decree Law 1350 of 1976, it is established that, before March 30 of each
year, the Board must approve the Corporation’s Business and Development Plan for the next three-year
period. Taking that plan as a reference, and keeping in mind the Corporation’s balance sheet for the
immediately preceding year and aiming to ensure its competitiveness, before June 30 of each year the
amounts that the Corporation shall allocate to the formation of capitalization funds and reserves shall be
determined by decree from the Ministries of Mining and Treasury.

Net income shown in the balance sheets, after deducting the amounts referred to in the previous
paragraph, shall belong to the State and becomes part of the Nation’s general income.

Pursuant to the Exempt Decree No. 184 of June 27, 2014 of the Ministry of Finance, the Corporation was
authorized to capitalize US$200 million of the net profit of the financial statements as of December 31,
2013.

Those resources were charged to the profits of 2014.

On October 24, 2014, the President of the Republic of Chile signed Law No. 20790. Such Law sets forth
an extraordinary capital contribution of up to US$3 billion for the Corporation during the period of 2014-
2018. The resources obtained from such capital contribution, together with the capitalization of the profits
obtained during such period — up to US$800 million — generated in that period, will serve to boost the
Investment Plan in mining projects, sustainability, mining development and renewal of equipment and
industrial plants. At December 31, 2014, there were no capitalized resources under such statute.

Pursuant to the Exempt Finance Decree (Decree No. 197 of December 31, 2015 issued by the Ministry of
Finance), the Corporation was authorized to capitalize US$225 million of the net profit registered in the
financial statements as of December 31, 2014.

Those resources were to be taken from the profits for year 2015 for their capitalization.

Pursuant to the ORD Finance Ministry Officio No. 1410 dated on May 27, 2016, it was established that the
aforementioned Decree confirms the impossibility of capitalizing the aforementioned US$225 million,
consequently the capitalization fund comprised of said amount was reversed.

On October 28, 2015, it was reported that after reviewing the Development Business Plan 2014-2018 for
Codelco, it was decided to make a capital contribution of US$600 million that was made effective on
December 2, 2015.

On December 1, 2016, it was informed that, pursuant to Article 1 of Law No. 20790, it was decided to

make an extraordinary capital contribution of US$500 million, which was made effective on December 28,
2016.

88
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Both capital contributions were funded by the Public Treasury through the sale of financial assets.

On January 27, 2017, Law No. 20989 on extraordinary capitalization was enacted. The Law authorizes the
transferring of funds from application of the Copper Reserved Law to the Public Treasury, allowing an
extraordinary capitalization to Codelco of up to US$950 million for year 2017 aiming to reduce Codelco’s
indebtedness in an amount equivalent to the difference between the funds transferred as required by the
Reserved Law No. 13196 and cash flow surpluses obtained by the Corporation.

On March 13, 2017, through Decree No. 322 an extraordinary capital contribution was authorized under
Article 2 of Law No. 20989, for a total amount of US$475 million. The capital contribution was made
effective on April 13, 2017.

By Exempt Decree of Treasury No. 1698, dated November 17, 2017, in accordance with the provisions of
Article 1 of Law No. 20790, it was decided to make an extraordinary contribution of capital for an amount
of US$520 million, which were recorded on December 22, 2017.

On October 16, 2018, the Ministry of Finance issued Exempt Decree 311 in which it has an extraordinary
capital contribution for Codelco pursuant to Law No. 20,790 of US$1,000 million, which will be made in a
first part for US$600 million and in a second part for US$400 million, and that will be transferred in
installments that will not be timed later than December 31, 2018 and February 28, 2019 respectively.

On December 26, 2018 the Corporation received the first part of the contribution to capital for US$600
million.

On February 26, 2019 the Corporation received the second part of the contribution to capital for US$400
million.

As of 2019, the Corporation has established that dividend payments will not be made as long as there are
prepayments of dividends paid in excess.

As of December 31, 2019, the Corporation has not paid dividends, due to the fact that in 2018 there were
advances of dividends paid in excess as follows:

ThUS$
Dividends payable as of December 31, 2017 295,842
Advance dividends as of December 31, 2018 155,719
Advance dividends overpaid as of December 31, 2018 150,900
Total dividends paid as of December 31, 2018 602,461

The consolidated statement of changes in equity discloses the changes in the Corporation’s equity.

89
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The movement and composition of other equity reserves is presented in the consolidated statement of

changes in equity.

Reclassification adjustments from other comprehensive income to profit or loss resulted in an income of
ThUS$3,337 and a loss of ThUS$4,597 for the year ended December 31, 2019 and 2018, respectively.

a) Other reserves

The detail of other reserves as of December 31, 2019 and 2018, is as follows:

Other Reserves 12/31/2019 | 12/31/2018
ThHuSs$ THuSs$
Reserve on exchange differences on translation (6,672) (6,863)
Reserve of cash flow hedges 19,506 47,792
Capitalization fund and reserves 4,962,393 4,962,393
Reserve of remeasurement of defined benefit plans (305,770) (274,480)
Other reserves 622,290 625,317
Total other reserves 5,291,747 5,354,159

b) Non-controlling interests

The detail of non-controlling interests, included in equity and profit or loss, as of and for each reporting

period, is as follows:

UN Non-controlling Net equity Gain (loss)
Societies participation
12/31/2019 12/31/2018 12/31/2019 12/31/2018 1/1/2019 1/1/2018
12/31/2019 12/31/2018

% % ThUus$ ThUS$ ThUS$ ThUS$
Inversiones Gacrux SpA 32.20% 32.20% 919,764 969,203 7,905
Others – – (7) 1 (14)
Total 919,757 969,204 7,891

For the year ended December 31, 2019, Inversiones Gacrux SpA did not distribute any dividends to

non-controlling interests.

The percentage of non-controlling interest in Inversiones Mineras Becrux SpA (previously Inversiones
Mineras Acrux SpA) generates a non-controlling interest in our subsidiary Inversiones Gacrux SpA,
which presents the following figures relating to its statement of financial position, statement of

comprehensive income and cash flows:

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Assets and liabilities 12/31/2019 | 12/31/2018

THus$ Thus$
Current Assets 227,367 361,568
Non-current assets 2,855,708 2,839,764
Current liabilities 157,345 176,742
Non-current liabilities 554,890 593,078

1/1/2019 1/1/2018

Results 12/31/2019 | 12/31/2018
THus$ Thus$
Revenues 682,079 836,195
Expenses (681,954) (762,557)
Profit of the year 125 73,638

1/1/2019 1/1/2018

Cash flow 12/31/2019 | 12/31/2018
THus$ Thus$
Net cash flow from operating activities 84,426 142,997
Net cash flow from (using) investing activities (42,403) –
Net cash flow from (using) financing activities (128,413) (204,961)

19. Revenue

Revenues for the years ended December 31, 2019 and 2018, are as follows:

1/1/2019 1/1/2018
Item 12/31/2019 12/31/2018
THUS$ ThUuS$

Revenue from sales of own copper 10,392,975 11,195,340
Revenue from sales of third-party copper 1,006,199 1,900,899
Revenue from sales of molybdenum 595,967 651,305
Revenue from sales of other products 520,351 537,562
Gain in futures market 9,439 23,652

Total 12,524,931 14,308,758

The Corporation’s revenue is recognized at a point in time.

The breakdown of revenue ¡is presented in explanatory note No.24 Operating Segments.
20.

21.

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Expenses by nature

Expenses by nature for the years ended December 31, 2019 and 2018, are as follows:

1/11/2019 1/11/2018
Item 12/31/2019 12/31/2018
TRUS$ TRUS$
Short-term benefits to employees 1,519,659 1,731,593
Depreciation 2,217,265 2,180,550
Amortization 2,804 590
Total 3,739,728 3,912,733

Impairment of Assets

As of December 31, 2018, the Corporation made a calculation of the recoverable amount of its cash
generating unit Ventanas Division, for the purpose of checking the existence of a deterioration in the value
of the assets associated with said division, the carrying amount of which amounted to US$323 million.

The aforementioned calculation of the recoverable amount determined a value of US$124 million, which
compared with the amount in books, implied an acknowledgment of an impairment loss of assets for
ThUS$198,898 (before tax), which was recorded in the Other ¡item expenses by function, of the
comprehensive income statement for the year 2018.

The recoverable amount determined for the calculation of the impairment loss corresponds to value in use
using a 7.2% annual discount rate before taxes. The main variables used to determine the recoverable
amount of this asset correspond to the price of acid, cost of treatment and refining, exchange rates and
discount rates.

The aforementioned loss due to impairment is mainly generated by the fall in the costs of treatment and
refining.

During the years ended December 31, 2019 and there were no indicators of additional deterioration or
reversals of impairment recognized in previous years.

92
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

22. Other income and expenses by function

Other income and expenses by function for the years ended December 31, 2019 and 2018, are as follows:

a) Other income by function

1/1/2019 1/1/2018
Item 12/31/2019 12/31/2018
TRUS$ TRUS$
Penalties to suppliers 27,954 18,920
Delegated Administration 4,713 5,346
Miscellaneous sales (net) 39,870 25,973
Insurance claims for claims 27,054 –
Customer recovery 7,836 –
Gain on sale of shares of related companies (Note 8) 103,151 18,279
Material retum 43,510 –
Reverse site closure update 33,993 –
Other miscellaneous income 72,609 56,308
Total 360,690 124,826
b) Other expenses by function
1/1/2019 1/1/2018
Htem 12/31/2019 12/31/2018
THUS$ THUS$

Law No. 13196 (935,599) (1,108,209)
Research expenses (85,621) (103,649)
Bonus for the end of collective bargaining (109,651) (204,623)
Expenses plan (100,747) (54,594)
Write-off of investment projects (7,261) (212,587)
Write-off of property, plant 8 equipment (27,495) (7,357)
Medical care plan (39,979) (9,962)
Impairment of assets (note 21) – (198,898)
Write-off inventories (35,136) (4,004)
Customer bad debt (1,307) –
Contingency expenses (20,482) (37,030)
Fixed indirect costs, low production level (313,917) (96,285)
Other (70,643) (78,116)
Total (1,747,838) (2,115,314)

93
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

23.

24.

Finance costs

The detail of finance costs for the years ended December 31, 2019 and 2018, is as follows:

1/1/2019 1/1/2018
Item 12/31/2019 12/31/2018
THUS$ ThHUS$

Bond interest (301,060) (265,001)
Bank loan interest (54,683) (69,869)
Unwinding of discount on severance indemnity provision (12,332) (16,497)
Unwinding of discount on other non-current provisions (43,798) (46,959)
Other (67,434) (65,122)

Total (479,307) (463,448)

Operating segments

The Corporation has defined its Divisions as its operating segments in accordance with the requirements
of IFRS 8, Operating Segments. The revenues and expenses of the Head Office are allocated among the
defined operating segments.

The mining deposits in operation, where the Corporation conducts its extractive and processing activities
are managed by the following Divisions: Chuquicamata, Radomiro Tomic, Ministro Hales, Gabriela Mistral,
Salvador, Andina and El Teniente. In addition, the smelting and refining activities are managed at the
Ventanas Division. All these Divisions have a separate operational management, which reports to the
Chief Executive Officer, through the North and South Central Vice-President of Operations, respectively.
The information on each Division and their corresponding mining deposits is as follows:

Chuquicamata

Types of mine sites: Open pit mines

Operating: since 1915

Location: Calama — Region |

Products: Electro refined and electrolytic (electro-obtained) copper cathodes and copper concentrate

Radomiro Tomic

Types of mine sites: Open pit mines

Operating: since 1997,

Location: Calama — Region ll

Products: Electro refined and electrolytic (electro-obtained) copper cathodes and copper concentrate

Ministro Hales

Type of mine: Open pit mine

Operating: since 2014

Location: Calama — Region |

Products: Calcined copper, copper concentrates
Gabriela Mistral

Type of mine: Open pit mine

Operating: since 2008

94
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Location: Calama — Region |
Products: Electrolytic (electro-obtained) cathodes

Salvador

Type of mine: Underground mine and open pit mine

Operating: since 1926

Location: Salvador — Region |1l

Products: Electro refined and electrolytic (electro-obtained) copper cathodes and copper concentrate

Andina

Type of mines: Underground and open pit mines
Operating: since 1970

Location: Los Andes – Region V

Product: Copper concentrate

El Teniente

Type of mine: Underground mine

Operating: since 1905

Location: Rancagua — Region VI

Products: Fire-refined copper and copper anodes

a) Allocation of Head Office revenue and expenses

Revenue and expenses controlled by the Head Office are allocated to the Divisions based on following
criteria.

The main items are assigned based on the following criteria:

Revenue and Cost of Sales of Head Office commercial transactions

+ Allocation to the operating segments is made in proportion to revenues of each Division.

Other income, by function

+ Other income by function, associated and identified with each Division, is directly allocated.

+ Recognition of realized profits and other income by way of subsidiaries are allocated in proportion
to the revenues of each Division.

+ The remaining other income is allocated in proportion to the aggregate of balances of “other
income” and “finance income” of each Division.

95
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Distribution costs

+ Expenses associated and identified with each Division are directly allocated.
+ Distribution costs of subsidiaries are allocated in proportion to the revenues of each Division.

Administrative Expenses

+ Administrative expenses associated and identified with each Division are directly allocated,

+ Administrative expenses recorded in cost centers associated with the sales function and
administrative expenses of subsidiaries are allocated in proportion to the revenues of each Division.

+ Administrative expenses recorded in cost centers associated with the supply function are allocated
in proportion to inventory balances in warehouse in each Division.

+ The remaining administrative expenses are allocated in proportion to operating cash outflows of
each Division.

Other Expenses, by function

+ Other expenses associated and identified with each Division are directly allocated.

+ Expenses for pre-investment studies and other expenses by function of subsidiaries are allocated in
proportion to the revenues of each Division.

Other gains

+ Other gains associated and identified with each Division are directly allocated.
+ Other gains of subsidiaries are allocated in proportion to the revenues of each Division.

Finance Income

+ Finance income associated and identified with each Division is directly allocated.

+ Finance income of subsidiaries is allocated in proportion to the revenues of each Division.

+ The remaining finance income is allocated in relation to the operating cash outflows of each
Division.

Finance costs

+ Finance costs associated and identified with each Division are directly allocated.
+» Finance costs of subsidiaries are allocated in proportion to the revenues of each Division.

Share in profit (loss) of associates and joint ventures accounted for using the equity method

+ Share in profit or loss of associates and joint ventures identified for each Division is directly
allocated.

96
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Foreign exchange differences

+ Foreign exchange differences identifiable with each Division are directly allocated.

+ Foreign exchange difference of subsidiaries is allocated in proportion to the revenues of each
Division.

+ The remaining foreign exchange differences are allocated in relation to operating cash outflows of
each Division.

Contribution to the Chilean Treasury under Law No. 13196

+ The amount of the contribution is allocated and accounted for in proportion to the invoiced and
recorded amounts for copper and sub-product exports of each Division, that are subject to the
surcharge.

Income tax benefit (expense)

+ Corporate income tax under D.L. 2398 and specific mining tax are allocated based on the income
before income taxes of each Division, considering for this purpose the income and expenses
allocation criteria of the Head Office and subsidiaries mentioned above.

+ Other tax expenses are allocated in proportion to the corporate income tax, specific mining tax and
tax under D.L. 2398 of each Division.

b) Transactions between segments

Transactions between segments mainly related to products processing services (or tolling services),
are recognized as revenue for the segment rendering the tolling services and as the cost of sales for
the segment that receives the service. Such recognition is made in the period in which these services
are rendered, as well as its elimination in the consolidated corporate financial statements.

Additionally, the reallocation of the profit and loss assumed by Ventanas Division, associated with the
corporate mineral processing contract between Codelco and Enami, in which a distribution is applied
based on the revenue of each division is included as a transaction between segments.

c) Cash flows by segments
The operating segments defined by the Corporation, has a cash management which refers mainly to
operational activities that need to be covered periodically with funds constituted in each of these
segments and whose amounts are not significant in relation to corporate balances of cash and cash
equivalents.

Conversely, activities such as obtaining financing, investment and payment of relevant financial
obligations are mainly based at the Head Office.

97
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The following tables details the financial information organized by operating segments:

From 1/1/2019

12/31/2019
. . . . . Total Subsidiaries and Total
Segments Chuquicamata R. Tomic Salvador Andina El Teniente Ventanas G. Mistral M. Hales Segments Head Office, net | Consolidated
ThUS$ ThUS$ ThUS$ ThUS$ ThUs$ LES Thus$ Thus$ ThUS$ ThUS$ Thus$

Revenue from sales of own copper 3,341,305 1,655,359 344,116 916,542 2,496,457 65,680 666,997 906,516 10,392,972 3 10,392,975
Revenue from sales of third-party copper 1,634 – – – – 19,233 – 20,867 985,332 1,006,199
Revenue from sales of molybdenum 297,324 10,251 20,026 67,524 194,153 – – – 589,278 6,689 595,967
Revenue from sales of other products 138,935 – 35,741 2,107 109,344 192,567 3,520 31,229 513,443 6,908 520,351
Revenue from futures market 5,859 3,023 418 (69) 29 (733) 805 107 9,439 9,439
Revenue between segments 35,928 – 24,103 2,554 1,330 105,184 – – 169,099 (169,099) –
Revenue 3,820,985 1,668,633 424,404 988,658 2,801,313 381,931 671,322 937,852 11,695,098 829,833 12,524,931
Costof sales of own copper (2,842,594)| — (1,244,908) (855,946) (918,185)| — (1,594,596) (65,974) (675,313) (731,320)| — (8,418,836) 622 (8,418,214)
Cost of sales of copper third-party copper (1,704) – – – (20,225) – (21,929) (974,448) (996,377)
Costof sales of molybdenum (83,780) (13,937) (9,241) (25,982) (47,803) – – – (180,743) (25,256) (205,999)
Costof sales of other products (130,612) – (20,442) (597) (60,816) (197,169) (3,390) (10,616) (423,642) (7,209) (430,851)
Cost of sales between segments (102,971) 42,164 (26,515) (1,589) 6,770 (98,331) (1,720) 13,093 (169,099) 169,099
Cost of sales (3,161,661)| — (1,216,681) (412,144) (946,353) — (1,696,445) (871,699) (680,423) (728,843)| — (9,214,249) (837,192)| — (10,051,441)
Gross profit 659,324 451,952 12,260 42,305 1,104,868 10,232 (9,101) 209,009 2,480,849 (7,359) 2,473,490
Other income, by function 100,500 8,817 20,493 24,001 42,197 1,853 6,878 5,535 210,274 150,416 360,690
Impairment gains determined in accordance with IFRS 9 – – – – – – – 378 378
Distribution costs (5,680) (214) (826) (270) (1,761) (1,262) (90) (1,323) (11,426) (5,643) (17,069)
Administrative expenses (50,451) (28,061) (13,913) (16,504) (45,847) (8,484) (28,135) (25,215) (216,610) (192,624) (409,234)
Other expenses, by function (440,991) (17,273) (96,233) (17,305) (104,232) (13,520) (18,937) (15,871) (724,362) (87,877) (812,239)
Law No. 13.196 (304,321) (148,096) (32,023) (89,524) (222,475) (18,931 (64,906) (65,323 (935,599) – (935,599)
Other gains – – – – – – – – 22,672 22,672
Finance income (1,209) (97) 89 251 874 202 18 (347) (219) 37,090 36,871
Finance costs (64,411) (47,344) (15,309) (64,068) (172,137) (9,899) (15,300) (46,784) (435,252) (44,055) (479,307)
Share in the profit (loss) of associates and joint ventures Ñ (409) (1,255) (1,201) Ñ (2,859) 16,062 13,203
accounted by the equity method
Exchange differences 52,099 10,535 9,807 18,840 56,738 5,586 8,113 13,565 175,283 (21,366) 153,917
Income (loss) before taxes (55,140) 230,219 (116,058) (103,529) 657,024 (34,223) (121,460) 83,246 540,079 (32,306) 407,773
Income tax expenses 29,969 (162,974) 76,094 61,658 (479,456) 20,763 83,454 (59,847) (430,340) 37,095 (393,245)
Income (loss) (25,171) 67,245 (39,964) (41,871) 177,568 (13,460) (38,006) 23,399 109,739 (95,211) 14,528

98

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

From 1/1/2018

12/31/2018
Chuquicamata | R. Tomic Salvador Andina El Teniente Ventanas G. Mistral M. Hales Total Subsidiaries and Total
Segments Segments Head Office, net | Consolidated
ThUSs$ Thus$ Thus$ Thus$ ThUus$ ThUSs$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$

Revenue from sales of own copper 3,100,186 2,058,291 365,850 1,102,898 2,778,189 13,497 641,681 1,125,496 11,186,088 9,252 11,195,340
Revenue from sales of third-party copper 177 – – – 14,597 – 23,123 37,897 1,863,002 1,900,899
Revenue from sales of moly bdenum 359,996 15,751 20,356 88,841 164,388 – – 649,332 1,973 651,305
Revenue from sales of other products 142,143 – 42,781 3,483 91,443 196,436 – 59,416 535,702 1,860 537,562
Revenue from futures market 8,474 10,322 687 (106) 1,210 64 2,316 685 23,652 – 23,652
Revenue between segments 122,767 – 73,379 1,487 94 105,787 – – 303,514 (303,514) –
Revenue 3,733,743 2,084,364 503,053 1,196,603 3,035,324 330,381 643,997 1,208,720 12,736,185 1,572,573 14,308,758
Costof sales ofown copper (2,880,603)| — (1,343,886) (297,189) (031,698)] — (1,637,057) (2,889) (540,134) (896,470)| — (8,630,926) (15,076) (8,646,002)
Costof sales of copper third-party copper (192) – – – – (16,345) – (23,123) (39,660) (1,841,680) (1,881,340)
Costof sales of molybdenum (79,793) (8,902) (9,530) (25,980) (51,627) – – – (175,832) (18,048) (193,880)
Costof sales of other products (140,063) – (27,477) (738) (74,274) (214,792) – (14,166) (471,510) (1,609) (473,119)
Costof sales between segments (198,829) 52,328 (79,004) 4,217 17,831 (117,771) (1,228) 18,942 (803,514) 303,514 –
Cost of sales (3,299,480)| — (1,300,460) (513,200) (054,199)| — (1,745,127) (852,797) (541,362) (914,817)| — (9,621,442) (1,572,899)| — (11,194,341)
Gross profit 434,263 783,904 (10,147) 242,404 1,290,197 (22,416) 102,635 293,903 3,114,743 (326) 3,114,417
Other income, by function 10,994 5,769 4,497 14,348 18,018 1,819 3,108 4,577 63,130 61,696 124,826
Impairment gains determined in accordance with IFRS 9 – – – – – – – – 158 158
Distribution costs (3,010) (570) (1,049) (944) (1,140) (597) (139) (1,043) (8,492) (9,770) (18,262)
Administrative expenses (60,412) (82,429) (17,676) (22,649) (66,815) (9,796) (22,361) (82,077) (264,215) (201,113) (465,328)
Other expenses, by function (97,154) (85,056) (125,943) (92,589) (171,207) (210,008) (12,023) (87,058) (781,038) (226,067) (1,007,105)
Law No. 13.196 (314,516 (201,452) (34,027 (118,451) (265,868) (15,137) (63,789) (94,969)| — (1,108,209 (1,108,209)
Other gains – – – – – – – 21,395 21,395
Finance income 189 244 126 115 2,174 84 18 160 3,110 48,219 51,329
Finance costs (62,271) (46,437) (14,073) (61,517) (155,965) (8,625) (17,075) (46,664) (412,627) (50,821) (463,448)
Share in the profit (loss) of associates and joint ventures
accounted by the equity method 174 (475) (466) (2,253) – – 6,020 122,134 119,114
Exchange differences 88,760 14,668 15,552 33,218 45,160 10,859 5,344 11,678 225,239 (47,096) 178,143
Income (loss) before taxes (2,983) 488,641 (183,215) (6,531) 692,301 (253,817) (4,282) 98,507 828,621 (281,591) 547,030
Income tax expenses 2,070 (329,166) 128,918 1,928 (476,388) 181,869 2,890 (68,015) (555,894) 198,611 (857,283)
Income (loss) (813) 159,475 (54,297) (4,603) 215,913 (71,948) (1,392) 30,492 272,727 (82,980) 189,747

99
CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The assets and liabilities related to each operating segment, including the Corporation’s head office as of
December 31, 2019 and 2018, are detailed in the following tables:

12/31/2019
Category Chuquicamata | domio le ador | Andina | ElTeniente | Ventanas | G.Mistral | M.Hales |ouccueries and [> Total
Tomic Head Office, net | Consolidated
ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$
Current assels 1,318,498 673,058] 409,962 269,730 959,041 63,802 264,389 342,614 1,748,927 6,050,021
Non-current assets 9,079,665 2,097,006] 1,0203] 4,828,805] 7,521,778] 268,457| 1,149,763] 3,247,562 5,079,521 | 34,204,590
Current labilites 821,067 179,649] — 140,456 214,350 474,126| 76,222 103,484 139,946 1,773,657 3,922,957
Non-current labiiies 765,850 262,729| 255,063 588,841| — 1,257,577| 138,455 152,528 115,909 21,250,035 | 24,786,987
12/31/2018
cat chueuicamata. | Fadomiro [ Andi El Teniente | Vent mistral | mates. SUbsidiarios and | Total
ategory uquicamata salvador ndina enient fentanas | G. Mistral -Hales cad fico, net | Consolidated
ThUS$ ThUS$ ThUSS ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$
Current assets 1,278,051 715,681] — 278,481 247,676 696,341 89,148 239,493 291,782 1,991,553 5,828,206
Non-current assets 7,863,667 1,941,213] — 727,675] 4,519,730] 6,547,657] 155316| 1,136,948] 3,278,883 5,091,501 | — 31,262,599
Current labilites 729,319 192,735] — 115,908 218,550 441,255| 61,363 111,615 117,624 1,551,043 3,539,412
Non-current labiiies 855,735 205,997| 196,608 472,713 910,005| 53,084 146,005 81,958 19,315,419 | 22,207,524
The revenue segregated per geographical areas is the following:
1/1/2019 1/1/2018
Revenue per geographical areas 12/31/2019 12/31/2018
Thus$ Thus$
Total revenue from domestic customers 2,616,605 1,313,064
Total revenue from foreign customers 9,908,326 12,995,694
Total 12,524,931 14,308,758
1/1/2019 1/1/2018
Revenue per geographical areas 12/31/2019 12/31/2018
Thus$ Thus$
China 2,315,772 3,867,505
Restof Asia 1,673,357 1,982,163
Europe 3,673,299 3,482,755
America 3,932,012 3,764,467
Other 930,491 1,211,868
Total 12,524,931 14,308,758

During the periods January – December 2019 and 2018, there is no income from ordinary activities from
transactions with a single client, representing 10 percent or more of the income of ordinary activities of the

Corporation.

100

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

25. Foreign exchange differences

The detail of foreign exchange differences for the years ended December 31, 2019 and 2018, is as

follows:
1/1/2019 1/1/2018
Gain (loss) from foreign exchange differences recognized inincome | 12/31/2019 12/31/2018
Thus$ Thus$
Gain from foreign exchange differences 254,314 277,780
Loss from foreign exchange differences (100,398) (99,637)
Total exchange difference, net 153,916 178,143

26. Statement of cash flows

The following table shows the items that comprise other collections and payments from operating activities
in the Statement of Cash Flows:

1/1/2019 1/11/2018
Other collections from operating activities 12/31/2019 12/31/2018
ThuS$ TRUS$
VAT Refund 1,580,041 1,513,219
Sales hedge 12,357 –
Other 234,866 220,336
Total 1,827,264 1,733,555
1/1/2019 1/11/2018
Other payments from operating activities 12/31/2019 12/31/2018
ThuS$ TRUS$
Contribution to Chilean treasury Law N?*13.196 (917,632) (1,136,559)
Sales hedge – (29,843)
VAT and other similar taxes paid (1,319,723) (1,388,782)
Total (2,237,355) (2,555, 184)

During the years ended December 31, 2019 and 2018, as indicated in the equity note, capital
contributions were received for a total of ThUS$400,000 and ThUS$600,000, respectively, which are

presented in other cash inflows (outflows) corresponding to the net cash flows provided by (used in)
activities of financing.

101
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

27.

Financial risk management, objectives and policies

Codelco has committees within its organization to set out strategies allowing to reduce the financial risks
to which it may be exposed.

The risks to which Codelco is exposed and a brief description of the management procedures that are
carried out in each case, are described below:

a. Financial risks

Exchange rate risk:

According to IFRS 7, exchange rate risk is understood to be the risk that arises from financial
instruments that are denominated in foreign currencies, that is, a currency other than the
Corporation’s functional currency (US dollar).

Codelco’s activities that generate this exposure correspond to funding in UF, accounts payable and
receivable in Chilean pesos, other foreign currencies used in its business operations and
obligations with employees.

The majority of transactions in currencies other than US$ are denominated in Chilean pesos. Also,
there is another portion in Euro, which corresponds mainly to a long-term loan issued through the
international market, which exchange rate risk is mitigated with hedging instruments (Swap).

Taking into consideration the financial assets and liabilities as of December 31, 2019 as the base, a
fluctuation (positive or negative) of 10 Chilean pesos against the U.S. dollar (keeping the other
variables constant), could affect profits before taxes by US$34 million in net income, respectively.
This result is obtained by identifying the main items (including assets and financial liabilities)
denominated in foreign currencies in order to measure the impact on profit or loss that a variation
of +/- 10 Chilean pesos would have in terms of US$, with respect to the closing exchange rate at
the end of the reporting period.

As of December 31, 2019 and 2018 the balance of time deposits denominated in Chilean pesos
amounts to ThUS$56,308 and ThUS$270,021, respectively.

Interest rate risk:

This risk arises from interest rate fluctuations in Codelco’s investment and financing activities. This
movement can affect future cash flows or the market value of fixed rate financial instruments.

102
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

These rate variations refer to U.S. dollar variations, mostly with respect to the LIBOR rate. To
manage this risk, Codelco maintains an adequate combination of fixed and variable rate debt, which
is complemented by the possibility of using interest-rate derivatives to meet the strategic guidelines
defined by Codelco’s Corporate Finance Department.

It is estimated that, on the basis of net debt balance as of December 31, 2019, a 1% change in
interest rates on the financial liabilities subject to variable interest rates would mean approximately
a US$23 million change in finance costs, before tax. This estimationis made by
identifying the liabilities assigned variable interest, accrued at the end of the financial statements,
which may vary with a change of one percentage point in variable interest rates.

Total fixed and variable interest rate obligations maintained by Codelco as of December 31, 2019
correspond to amounts of ThUS$14,189,945 and ThUS$3,074,411, respectively.

Market risks
– — Commodity price risk:

As a result of its commercial operations and activities, the Corporation’s income is mainly
exposed to the volatility of copper prices and certain sub-products such as gold and silver.

Copper and molybdenum concentrate sale agreements and copper cathode sale agreements
generally provide for provisional pricing of sales at the time of shipment, with final pricing based
on the monthly average market price for specified future periods. At the reporting date, the
provisionally priced metal sales are marked-to-market, with adjustments (both gains and losses)
being recorded in revenues in the consolidated statement of comprehensive income. Forward
prices at the period-end are used for copper sales, while period-end average prices are used for
molybdenum concentrate sales due to the absence of an assets futures market. (See Note 2.r)
“Income from Activities Ordinary Procedures from Contracts with Customers “of section II” Main
policies countable ”).

For the year ended December 31, 2019, if the future price of copper fluctuates by + / – 5% (with
the other variables constant), the result would vary in an amount of US$97 million before taxes
as a result of setting the mark to market of sales revenue to provisional prices in effect as of
December 31, 2019 (MTMF 314). For the estimate indicated, all of those physical sales
contracts were valued according to the monthly average immediately following the close of the
financial statements, and proceeds to be estimated regarding what the final settlement price will
be if there ¡is a difference of + / – 5% with respect to the future price known to date for this period.

In order to protect cash flow and adjust, where necessary, its sales contracts to its trade policy,
the Corporation holds operations in futures markets. At the end of the reporting period, these
contracts are adjusted to fair value, recording this effect, at the settlement date of the hedging
transactions as part of net product sales.

103
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

d.

As of December 31, 2019, a variation of U.S. £ 1 in the price per pound of copper, considering
derivatives contracted by the Corporation, involves a change in income or payments for existing
contracts (exposures) of US$194 before taxes. This calculation is obtained from a simulation
curves of future copper prices, which are used to assess the subscribed derivative instruments
by the Corporation; estimations would vary with respect to the exposure related these
instruments if there is an increase of U.S. $0.01 decrease in the price per pound of copper.

The Corporation has not entered into any hedging transactions with the specific purpose of
hedging the price risk caused by fluctuations in prices of production inputs.

Liquidity risk

The Corporation ensures that it has sufficient resources, such as pre-approved credit lines (including
refinancing), in order to meet short-term requirements, after considering the necessary working
capital for its operations and any other commitments it has.

In this sense, Codelco Chile maintains resources at its disposal sufficient to meet its obligations,
whether in cash, liquid financial instruments or credit facilities.

In addition, the Finance Department constantly monitors the Corporation’s cash flow projections
based on short and long term projections and available financing alternatives. In addition, the
Corporation estimates that it has enough headroom to increase the level of borrowing for the normal
requirements of its operations and investments established in its development plan.

In this context, according to current existing commitments with creditors, the cash requirements to
cover financial liabilities classified by maturity and presented in the statement of financial position are
detailed as follows:

Less than Between one More than
Maturity of financial liabilities as of 12/31/2019 one year and five years five years
ThUS$ ThUS$ ThUS$

Loans from financial institutions 666,144 1,195,172 1,213,095
Bonds 572,587 1,635,870 11,981,488
Finance leases 127,761 243,711 61,399
Derivatives 11,496 – 148,987
Other financial liabilities 363 58,501 –
Total 1,378,351 3,133,254 13,404,969

Credit risk

This risk comprises the possibility that a third party does not fulfill its contractual obligations, thereby
causing a loss for the Corporation.

104
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Given the Corporation’s sales policy, principally with cash and advance payments and bank letters of
credit, the uncollectability of client debt balances is minimal. This is complemented by the familiarity
the Corporation has with its clients and the length of time it has operated with them. Therefore, the
credit risk of these transactions is not significant.

The indications with respect to the payment conditions to the Corporation are detailed in every sales
contract and the negotiation management is under the charge of the Vice Presidency of Marketing.

In general, the Corporation’s other accounts receivable have a high credit quality according to the
Corporation’s evaluations, based on each debtor’s solvency analysis and payment history.

The maximum exposure to credit risk as of December 31, 2019 is represented by the financial asset
items presented in the Corporation’s Statement of Financial Position.

The Corporation’s accounts receivable do not include customers with balances that could be
classified as a significant concentration of debt and would represent a material exposure for Codelco.
This exposure is distributed among a large number of clients and other counterparties.

In the customer items, the provisions, which are not significant, are included based on the review of
the outstanding balances and characteristics of the clients, destined to cover eventual insolvencies.

In explanatory note 2, trade and other receivables presents past due balances that have not been
impaired.

The Corporation estimates that unimpaired amounts overdue over 30 days are recoverable based on
clients’ historical payment behavior and their existing credit ratings.

As of December 31, 2019 and 2018, there are no receivable balances that have been renegotiated.
Codelco works with major banks, which have high national and international ratings, and continually
assesses them; therefore, the risk that could affect the availability of the Corporation’s funds and
financial instruments is not significant.

Also, in some cases, to minimize credit risk, the Corporation has contracted credit insurance policies
through which it transfers to third parties the commercial risk associated with some aspects of its
business.

During the year ended December 31, 2019 and 2018, no guarantees have been executed to ensure
the collection of third party debt.

Personnel loans mainly related to mortgage loans, according to programs included in union
agreements, which are paid for through payroll discounts.

105
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

28.

Derivatives contracts

The Corporation has entered into transactions to hedge cash flows, to minimize the risk of foreign
exchange rate variations and sales price variations, detailed as follows:

a. Hedges

The Corporation has taken measures to protect itself from exchange rate and interest rate variations,
whose positive fair value, net of taxes, amounts to TAUS$19,792.

The following table summarizes the detail of the financial hedges contracted by the Corporation:

December 31, 2019

Type of colin: Fair value of
Hedged item Bank derivative| Maturity |Currency| Amount . hedging Asset Liability
contract hedging instruments
instrument
ThUS$ ThUuSs$ ThUuS$ ThUus$ Thus$
Bond UF Mat 2025 [Credit Suisse (EE.UU) Swap 4/1/2025 US$ 260,890 208,519 75,608 | 329,480 | (253,872)
Bond EUR Mat. 2024 [Santander (Chile) Swap 7/9/2024 US$ 336,399 409,650 (73,114)| 380,570 | (453,684)
Bond EUR Mat. 2024 [Deustche Bank (Inglaterra) Swap 7/9/2024 US$ 336,399 409,680 (72,756)| 380,583 | (453,339)
Bond UF Mat 2026 [Santander (Chile) Swap | 8/24/2026 | US$ 378,101 406,212 6,976 | 461,581 (454,605)
Bond AUD Mat. 2039 |Santander (Chile) Swap | 8/22/2039 | US$ 49,013 49,266 (1,558) 54,509 (56,067)
Bond HKD Mat. 2034 [HSBC Bank USA N.A. (EH Swap | 11/7/2034 | US$ 64,220 63,792 (703) 64,220 (64,923)
Total 1,425,022 | 1,547,119 (65,547) | 1,670,943 | (1,736,490)
December 31, 2018
Type of Financial Fair value of
Hedged item Bank derivative | Maturity |Currency| Amount a hedging Asset Liability
contract . instruments
instrument
Thus$ Thus$ Thus$ ThUS$ ThUS$
Bond UF Mat. 2025 [Credit Suisse (USA) Swap 4/1/2025 US$ 273,765 208,519 84,365 334,180 | (249,815)
Bond EUR Mat 2024 |Santander (Chile) Swap 7/9/2024 US$ 343,170 409,650 (53,592) 388,339 | (441,931)
Bond EUR Mat 2024 |Deustche Bank (England) | Swap 7/9/2024 US$ 343,170 409,680 (53,170) 388,339 | (441,509)
Bond UF Mat. 2026 [Santander (Chile) Swap | 8/24/2026| US$ 396,761 406,212 23,335 458,627 | (435,292)
Total 1,356,866 | 1,434,061 938 1,569,485 | (1,568,547)

As of December 31, 2019, the Corporation does not maintains cash deposit guarantee balances.

The current methodology for valuing currency swaps is to use the bootstrapping technique from the
mid – swap rate to construct the curves (zero) in UF and USD respectively, from market information.

106
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The notional amounts are detailed below:

Notional amount of contracts with final maturity
Less than 90 | More than 90 More than5 | Non- t
December 31, 2019 Currency ess nan ore nan CurrentTotal | 1to3 years | 3to5 years ore nan orcumen
days days years Total
ThUs$ ThUS$ ThUS$ ThUs$ ThUS$ ThUS$ ThUs$
Currency derivatives ThUS$ 13,156 48,151 61,307 122611 122,611 1,629,037 1,874,259

b. Cash flows hedging contracts and commercial policy adjustment

The Corporation enters into metals hedging activities. Such results increase or decrease the total sales
revenue based on the market prices of the metals. As of December 31, 2019, these operations
generated a gain of ThUS$10,935.

b.1

b.2.

. Commercial flexibility operations of copper contracts

The purpose of these contracts is to adjust the price of shipments to the price defined in the
Corporation’s related policy, defined in accordance with the London Metal Exchange (LME). As of
December 31, 2019, the Corporation performed derivative market transactions of copper that
represent 432,800 metric tons of fine copper. These hedging operations are performed as part of
the Corporation’s commercial policy.

The current contracts as of December 31, 2019, present a negative fair value of ThuS$815 and
their final result will only be known at their maturity, offsetting the hedging transactions with
revenue from the sale of the hedged products.

The transactions settled as of year ended December 31, 2019 resulted in a net positive effect on
net income of ThUS$11,960, which is comprised of the amounts received for sales contracts for
ThUS$10,464 and the amounts net off against purchases contracts for ThUS$1,496.

Commercial Transactions of Current Gold and Silver Contracts

As of December 31, 2019, the Corporation maintains derivative contracts for the sale of gold and
silver of ThOZT 2,720.

The contracts outstanding as of December 31, 2019 show a negative fair value of ThUS$1. The
final result will only be known at the expiration of such operations, after offsetting between
hedging and income from the sale of the goods. These hedging operations expire up until April
2020.

107

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

b.3.

The operations completed between January 1 and December 31, 2019, generated a negative
effect on results of ThUS$1,025, corresponding to values per physical sales contracts for a
negative amount of ThUS$1,025.

Cash flow hedging operations backed by future production

The Corporation does not possess cash flow hedges backed by future production as of December
31, 2019.

The following tables set forth the maturities of metal hedging activities, as referred to in point b
above:

December 31, 2019 Maturity date
ThUS$ 2020 2021 2022 2023 2024 Upcoming Total

Flex Com Cobre (Asset) 1,315 525 – – – – 1,840|

Flex Com Cobre (Liability) (1,799) (844) (12) – – . (2,655)

Flex Com Gold/Silver (1) – – – – . (1)

Price setting

Metal options

Total (485) (819) (12) – – – (816)

December 31, 2018 Maturity date

ThUs$ 2019 2019 2020 2021 2022 Upcoming Total

Flex Com Cobre (Asset) 43,539 13,969 993 – – – 58,501
Flex Com Cobre (Liability) (56) (62) – – – – (118)
Flex Com Gold/Silver (671) – – – – – (671)
Price setting – –
Metal options

Total 42,812 13,907 993 – – – 57,712

December 31, 2019 Maturity date

AII figures in thousands of
metric tons ounces 2020 2021 2022 2023 2024 Upcoming Total

Copper Futures [MT] 335.65 96.65 0.50 – – – 432.80
Gold/Silver Futures [MOZ] 2.72 – – – – – 2.72
Copper price setting [MT]

Copper Options [MT]

December 31, 2018 Maturity date

AII figures in thousands of
metric tons ounces 2019 2020 2021 2022 2023 Upcoming Total

Copper Futures [MT] 300.10 110.45 10.30 – – – 420.85
Gold/Silver Futures [TMOZ] 349.57 – – – – – 349.57
Copper price setting [MT] –

Copper Options [MT]

108
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

29. Contingencies and restrictions
a) Litigations and contingencies

There are various lawsuits and legal actions initiated by or against the Corporation, which derive from
its operations and the industry in which it operates. In general, these are civil, tax, labor and mining
litigations, all related to the Corporation’s activities.

In the opinion of Management and ¡ts legal advisors, the lawsuits where the Corporation is being sued
and could have negative results do not represent significant loss contingencies or cash flows. Codelco
defends its rights and employs all corresponding relevant legal instances, resources and procedures.
The most significant lawsuits that involve Codelco are related to the following matters:

– Tax proceedings: There is a tax proceeding for liquidation No.141 of tax year 2015 and
Exempt Resolution No. 89 of 2016 issued by the Internal Revenue Service (SI), for which the
Corporation presented the corresponding appeals, which were received and resolved in favor of the
Tax and Customs Courts, a resolution that was appealed by the SI!.

– Labor proceedings: Labor proceedings brought by the workers of the Andina Division against the
Corporation with regard to occupational diseases (silicosis).

– Mining proceedings and others arising from the Operation: The Corporation has been participating,
and will probably continue to participate, as plaintiff and defendant in given court proceedings
involving its mining operation and activities, through which it seeks to exercise certain actions or set
up certain defenses in relation to given mining concessions that have been established or are in the
process of being established, as well as also with regard to its other activities. These proceedings
currently do not involve any given amount and do not have any essential effect on Codelco’s
development.

– — Atthe date of issuance of these financial statements, the Codelco faces various lawsuits and legal
actions against it for a total of approximately US$306 million corresponding to 372 cases. According
to the estimate made by the legal advisors of the Corporation, 298 cases, which represent 80.11%
of the universe, have associated probable loss results amounting to ThUS$49,684. There are also
61 cases, representing 16.4% for an amount of ThUS$34,981, for which it is more likely than not,
that the ruling will not be against the Corporation.

– Lawsuit under administrative law: On August 2, 2017, a Nullity in Public Law claim was filed in the
25th Civil Court of Santiago against Audit Report No. 900 of 2016, issued by the General
Comptrollership of the Republic on May 10, 2017. At this date, the discussion stage has been
completed and the evidence submitting stage should start soon.

For litigation with a probable unfavorable outcome for the Corporation, the necessary provisions has
been recognized as “provisions for legal proceedings.”

109
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

b) Other Commitments

i. On May 31, 2005, Codelco, through its subsidiary Codelco International Ltd. signed an agreement
with Minmetals to form a company, CuPIC, in which both companies have an equal equity
interest. A 15-year copper cathode sales contract to that associated company was agreed upon,
as well as a purchase contract from Minmetals to CupiC for the same period and for equal
monthly shipments to complete a total of 836,250 metric tons. Each shipment shall be paid for by
the buyer at a price formed by a fixed re-adjustable component plus a variable component, which

depends on current copper prices at the time of shipment.

During the first quarter of 2006 and on the basis of the negotiated financial terms, financing
contracts were formalized with the China Development Bank allowing CuPIC to make the US$550

million advance payment to Codelco in March 2006.

With regard to financial obligations incurred by the associate CuPIC with the China Development
Bank, Codelco Chile and Codelco International Ltd, must meet certain commitments, mainly
relating to the delivery of financial information. In addition, Codelco Chile must maintain 51%

ownership of Codelco International Limited.

According to the Sponsor Agreement, dated March 8, 2006, the Codelco International Ltd.

subsidiary gave its participation in CuPIC as a guarantee to the China Development Bank.

Subsequently, on March 14, 2012, CUuPIC paid off its debt to the abovementioned bank. As of
December 31, 2017. Codelco does not hold any indirect guarantee regarding its participation in

this associated company.

On December 17, 2015, the Codelco administration presented a restructuring for the Supply

Contract, which implies the removal of its share in CUPIC.

On April 7, 2016, the Corporation formalized the removal of ¡ts share in CUPIC, of which Codelco
retained 50% ownership through the subsidiary Codelco International. Until that date, Codelco
shared the ownership of the Company in the same proportion with the company Album

Enterprises Limited (a subsidiary of Minmetals).

In order to realize the above mentioned term of the shareholding, Codelco signed a set of

agreements which formalized primarily the following issues:

+ Copper sales contract modifications from Codelco to CUPIC signed in 2006, which establishes
the reduction of half of the outstanding tonnage to deliver to this company and in which

Codelco pays to CUPIC the amount of ThUS$99,330.

+ Reduction of share capital in CuPIC, equivalent to the 50% of the Codelco International shares

in said company and by which CuPIC repays to Codelco the amount of ThUS$99,330.
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

+ Waiver of Codelco to any dividends associated with the profits generated by CuPIC from
January 1, 2016 and the date of signing the agreement.

* Additionally, the cessation of dividends reception as a consequence of the removal of the
Codelco share in the ownership of CuPIC since 2016, led to a reduction of the net profit
estimated to Codelco until the end of the contract signed with that company (year 2021). This
implied that such contract qualifies as an onerous contract, according to lAS 37, which
negatively impacts on earnings before tax of Codelco in ThUS$22,184 (negative net tax effect
of ThUS$6,599 as of April 7, 2016).

Regarding the financing agreement signed on August 23, 2012, between the subsidiary, Gacrux
Inversiones SpA and Mitsui 8 Co. Ltd. for the acquisition of the 24.5% stake in Anglo American
Sur S.A. which was subsequently amended on October 31, 2012, a pledge is included over the
shares that the subsidiary has on Acrux Inversiones SpA (shared participation with Mitsui and
minority shareholder in Anglo American Sur S.A.), in order to ensure compliance with the
obligations that the financial agreement contemplates.

This pledge extends to the right to collect and receive from Acrux dividends which have been
agreed in the corresponding meetings of shareholders of the company and any other distributions
paid or payable to Gacrux respect of the pledged shares.

On December 22, 2017 according to archive No. 12326 / 2017, itwas established that, Gacrux,
the Creditor and the Guarantee Agent, the latter representing the Guaranteed Parties, modified ,
by virtue of the Merger (see Note 2d), the Contract of Pledge and the Modified Pledge Agreement
as to the pledge on transferable securities and the commercial pledge, as well as the restrictions
and prohibitions established in the Pledge Contract and in the Modified Pledge Contract, making it
subject to , by virtue of the Merger, to two thousand thirteen million two hundred and forty-five
thousand four hundred and seventy-three shares pledge issued by Becrux, owned by Gacrux,
hereinafter the “Pledged Becrux Shares.”

Law 19.993 dated December 17, 2004, authorized the purchase of the Refinery and Smelter Las
Ventanas assets from ENAMI, establishing that the Corporation must ensure that the smelting and
refining capacity required is maintained, without any restriction and limitation, for treating the
products of the small and medium mining sector sent by ENAMI, under the form of toll production
or another form agreed upon by the parties.

Obligations with the public for bond issues means that the Corporation must meet certain
restrictions related to limits on pledges and leaseback transactions on its principal assets and on
its ownership interest in subsidiaries.

The Corporation has complied with these conditions as of December 31, 2019 and 2018.

111
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

v.

vi.

vil.

viii.

On January 20, 2010, the Corporation signed two energy supply contracts with Colbún S.A,,
which includes energy and power sales and purchases for a total of 510 MW of power. The
contract provides a discount for that unconsumed energy from Codelco’s SIC divisions with
respect to the amount of contracted power. The discount is equivalent to the value of the sale of
that energy on the spot market.

The contracted power for supplying these Divisions is comprised by two contracts:

– Contract No.1 for 176 MW, current until December 2029

– Contract No.2 for 334 MW, current until December 2044. This contract is based on energy
production from Colbún’s Santa María thermal power station, which is currently in operation.
This plant is coal-fired, and therefore the electric energy tariff rate applied for the energy
supplied to Codelco is linked to the price of coal.

Both of these contracts comply with Codelco’s long-term energy and power requirements from the
SIC of approximately 510 MW.

Through these contracts, which operate through take or pay, the Corporation agrees to pay for the
contracted energy and Colbún undertakes to reimburse at market price the energy not consumed
by Codelco.

These contracts have maturity dates in 2029 and 2044.

On November 6, 2009, Codelco signed the following long-term electric energy supply contracts
with ELECTROANDINA S.A. (associate until January 2011), which matured in August 2017.
For the electric power supply of the Chuquicamata’s work center, there are three contracts:
– — Engie for a 15-year term from January 2010, that is maturing in December 2024, for 200
MW capacity, and another contract for a 200 MW capacity which was signed in January
2018 and will be effective as of January 2025 with maturity in December 2035.
– CTA effective from 2012 for 80 MW capacity, maturity in 2032.

On August 26, 2011, Codelco signed two energy supply contracts with AESGener. The first one
for the Minister Hales division for a 99 MW capacity and the second contract for the Radomiro
Tomic work center, for a maximum capacity of 145 MW. Both contracts will mature in 2028.

On November 11, 2011, Law No. 20551 was published in the Official Journal, which regulates the
tasks and closure of mining facilities. Additionally, on November 22, 2012, the Supreme Decree
No. 41 of the Minister of Mining, which approves the Regulations of this Law, was published in the
Diario Oficial.

This law requires the Corporation, among other requirements, to provide financial guarantees to

the State to ensure the implementation of closure plans. lt also establishes the obligation to make
contributions to a fund which aims to cover the costs of post-closure activities.

112
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The Corporation, in accordance with the mentioned regulation, provided to SERNAGEOMIN the
Mine Closure Plan (ARO) for all of the Codelco operating divisions in 2014, which were approved
in 2015 in accordance with the provisions of the Act.

The mine closure plans delivered to SERNAGEOMIN were developed by invoking the transitional
regime of the Act, which was specified for the affected mining companies under the general
application procedure (extraction capacity > 10,000 tons per month), and which, at the date of
enactment of the Law, will abide in operation and move forward with a mine closure plan
previously approved under Mine Safety Regulations Supreme Decree No. 132.

The Corporation considers that the accounting liability recorded caused by this obligation differs
from the law’s requirement, mainly by differences concerning the horizon that is considered for the
projection of flows, in which the law requires the determination of the obligations in terms of
mineral reserves, while the financial-accounting approach incorporates some of its mineral
resources. Therefore, the discount rate established by law, may differ from that used by the
Corporation under the criteria set out in lAS 37 “Provisions, Contingent Liabilities and Contingent
Assets” and described in Note 2, letter p) of Main Accounting Policies.

As of December 31, 2019, the Corporation has agreed guarantees for an annual amount of U.F.
27,892,917 to comply with the aforementioned Law No. 20.551. The following table details the
main given guarantees:

Transmitter Mine site Amount |Currency Date Maturity date a Thus$
lo
Banco Estado Radomiro Tomic| 3,232,980 UF 11/8/2019 | 11/10/2020 0.09 122,239
Banco ltau Ministro Hales 1,845,954 UF 11/6/2019 | 11/13/2020 0.09 69,796
Banco de Chile Chuquicamata 4,191,593 UF 11/26/2019 | 11/26/2020 0.10 158,485
Banco Santander El Teniente 5,000,000 UF 11/29/2019 | 12/2/2020 0.15 189,051
Banco ltau El Teniente 2,367,016 UF 11/28/2019 | 12/2/2020 0.15 89,497
Banco Bci El Teniente 1,800,000 UF 11/29/2019 | 12/2/2020 0.18 68,058
Banco Estado Gabriela Mistral 1,978,180 UF 12/11/2019 | 12/15/2020 0.11 74,795
Banco ltau Salvador 2,700,000 UF 8/8/2018 2/18/2020 0.10 102,087
Banco Santander Salvador 611,647 UF 2/6/2019 2/18/2020 0.15 23,126
Banco Estado Andina 3,310,724 UF 4/22/2019 5/3/2020 0.07 125,179
Banco Estado Ventana 400,043 UF 12/19/2019 | 10/7/2020 0.10 15,126
Banco Bci Ventana 454,782 UF 12/18/2019 | 10/7/2020 0.18 17,195
Total 27,892,919 1,054,634

On August 24, 2012, Codelco through its subsidiary Inversiones Mineras Nueva Acrux SpA
(Nueva Acrux) (which minority shareholder is Mitsui), signed a contract with Anglo American Sur
S.A. Under this contract, Codelco agreed to sell a portion of its annual copper production to the
mentioned subsidiary, who in turn agrees to purchase such production.

Such annual portion is determined by the share of Codelco’s indirect subsidiary, Inversiones

Mineras Becrux SpA (also shared ownership with Mitsui), maintained for the shares of Anglo
American Sur S.A.

113
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

In turn, the subsidiary Nueva Acrux agrees to sell to Mitsui, the products purchased under the
agreement described in the preceding paragraphs.

The contract expiration will occur when the shareholders agreement of Anglo American Sur S.A
ends or other events related to the completion of mining activities of the company take place.

On June 11, 2019, Codelco and Anglo American Sur S.A. signed an agreement that ensures and
optimizes the operation of their respective copper mines, Andina and Los Bronces, respectively.
This agreement is similar to others that the same parties have signed during the last 40 years and
that favor the independent, safe and sustainable operation of these neighboring mines.

114
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

30. Guarantees
The Corporation as a result of its activities has received and given guarantees.

The following tables list the main guarantees given to financial institutions:

Direct Guarantees provided to Financial Institutions
Creditor of the Guarantee Type of Gu: 123112019 1213112018
Currency | Maturity ThUs$ Thus$

Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
Ministry of national goods Project of exploitaion CLP 2/28/2020 7 –
General Directorate of Maritime Territory and Merchant Marine Maritime concession CLP 3/1/2020 1,409 –
General Directorate of Maritime Territory and Merchant Marine Maritime concession CLP 6/30/2020 2 –
General Directorate of Maritime Territory and Merchant Marine Maritime concession CLP 7/15/2020 230 –
Minestry of Public Works Building project UF 12/31/2019 22,364 –
General Directorate of Mariime Territory and Merchant Marine Building project CLP 3/1/2019 – 1,783
Minestry of Public Works Building project UF 10/1/2019 – 566
Minestry of Public Works Building project UF 10/2/2021 516 –
management Building project UF 3/1/2020 1 –
management UF 3/1/2020 1 –

Viability management Building project UF 3/1/2020 1 –
management Building project UF 3/1/2020 1 –

Viability management Building project UF 4/22/2020 4 –
management Building project UF 2/18/2020 1 –

Viability management Building project UF 4/8/2024 4 –
management Building project UF 3/10/2020 2 –
management UF 3/10/2020 2 –

Viability management Building project UF 3/10/2020 4 –
Ministry of national goods Project of exploitaion UF 6/19/2020 8 –
Ministry of national goods Project of exploitaion UF 6/19/2020 8 –
Ministry of national goods Project of exploitaion UF 6/19/2020 8 –
[Oriente Copper Netherlands B.V. Pledge on shares US$ 11/1/2032 877,813 877,813
|¡Semageomin Environmental UF 3/18/2019 – 17,920
|¡Semageomin Environmental UF 5/9/2019 – 137,355
|¡Semageomin Environmental UF 6/13/2019 – 73,210
|¡Semageomin Environmental UF 6/13/2019 – 11,980
|¡Semageomin Environmental UF 6/1/2019 – 110,322
|¡Semageomin Environmental UF 6/1/2019 – 273,875
|¡Semageomin Environmental UF 5/25/2019 – 192,789
|¡Semageomin Environmental UF 5/25/2019 – 103,290
|¡Semageomin Environmental UF 5/12/2019 – 39,150
|¡Semageomin Environmental UF 5/12/2019 – 38,215
|¡Semageomin Environmental UF 5/25/2019 – 96,395
|¡Semageomin Environmental UF 11/11/2019 122,239 –
|¡Semageomin Environmental UF 11/14/2019 69,796 –
|¡Semageomin Environmental UF 11/14/2019 158,485 –
|¡Semageomin Environmental UF 11/27/2019 189,051 –
|¡Semageomin Environmental UF 11/27/2019 89,497 –
|¡Semageomin Environmental UF 11/27/2019 168,058 –
|¡Semageomin Environmental UF 12/2/2019 74,795 –
|¡Semageomin Environmental UF 12/2/2019 102,087 –
|¡Semageomin Environmental UF 12/15/2019 23,126 –
|¡Semageomin Environmental UF 2/18/2020 125,179 –
|¡Semageomin Environmental UF 5/3/2020 15,126 –
|¡Serageomin Environmental UR 9/18/2020 17,195 –
Total 1,957,167 | 1,974,663

115
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

As for the documents received as collateral, they cover mainly obligations of suppliers and contractors

related to the various development projects. Below are given the amounts received as collateral, grouped

according to the Operating Divisions that have received these amounts:

Guarantees received from third parties
Division 12/31/2019 12/31/2018
ThUs$ ThUus$
Andina 418 3,891
Chuquicamata 375 2,445
Casa Matriz 887,051 803,719
Salvador 387 1,311
El Teniente 447 4,137
Ventanas 52 105
Total 888,730 815,608

31. Balances in foreign currency

a) Assets by Type of Currency

Category 12/31/2019 12/31/2018
ThUs$ ThUus$
Liquid assets 1,476,056 1,460,534
US Dollars 1,385,451 1,383,897
Euros 49,773 25,482
Other currencies 4,674 4,547
Non-index ed Ch$ 34,367 46,129
UF. 1,791 479
Cash and cash equiv alents 1,303,105 1,229,125
US Dollars 1,212,657 1,152,715
Euros 49,773 25,482
Other currencies 4,674 4,547
Non-index ed Ch$ 34,348 46,109
UF. 1,653 272
Other current financial assets 172,951 231,409
US Dollars 172,794 231,182
Euros – –
Other currencies – –
Non-index ed Ch$ 19 20
UF. 138 207
Short and long term receivables 2,723,280 2,409,835
US Dollars 2,042,514 1,789,757
Euros 112,649 62,857
Other currencies 384 320
Non-index ed Ch$ 547,809 482,180
UF. 19,924 74,721
Trade and other receivables 2,588,268 2,212,209
US Dollars 2,006,046 1,676,862
Euros 112,649 62,580
Other currencies 384 320
Non-index ed Ch$ 450,304 398,966
UF. 18,885 73,481

116
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

12/31/2019 12/31/2018
Category
ThUsS$ ThUs$
Rights receivables, non-current 98,544 84,731
US Dollars – –
Euros 277
Other currencies – –
Non-indexed Ch$ 97,505 83,214
UF. 1,039 1,240
Due from related companies, current 20,874 92,365
US Dollars 20,874 92,365
Euros –
Other currencies – –
Non-indexed Ch$ – –
UF. – –
Due from related companies, non-current 15,594 20,530
US Dollars 15,594 20,530
Euros –
Other currencies – –
Non-indexed Ch$ – –
UF. – –
Rest of assets 36,145,275 33,220,436
US Dollars 35,353,960 32,171,442
Euros 191 705
Other currencies 65,714 279
Non-indexed Ch$ 86,056 377,119
UF. 639,354 670,891
Total assets 40,344,611 37,090,805
US Dollars 38,781,925 35,345,096
Euros 162,613 89,044
Other currencies 70,772 5,146
Non-indexed Ch$ 668,232 905,428
UF. 661,069 746,091

117
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

b) Liability by type of currency:

12/31/2019 12/31/2018
Current liability by currency Up to 90 days | 90 days to 1 year | Up to 90 days | 90 days to 1 year
ThUS$ ThUs$ ThUs$ ThUS$

Current liabilities 3,031,838 891,119 3,049,854 489,558
US Dollars 1,874,286 812,946 1,824,181 452,648
Euros 84,339 (7,238) 107,341 408
Other currencies 10,280 5,180 9,826 –
Non-indexed Ch$ 1,041,933 73,518 1,088,536 31,419
UF. 21,000 6,713 19,970 5,083
Other current financial liabilities 508,466 869,885 412,451 459,826
US Dollars 468,557 812,910 396,148 452,635
Euros 7,236 (7,238) 7,404 408
Other currencies 813 5,180 34 –
Non-indexed Ch$ 21,818 52,661 879 1,700
UF. 10,042 6,372 7,986 5,083
Bank loans 326,228 339,916 5,739 399,132
US Dollars 326,228 339,916 5,683 398,724
Euros – – – 408
Other currencies – – – –
Non-indexed Ch$ > – – >
UF. – – 56 –
Obligations 146,757 425,830 401,174 34,255
US Dollars 132,851 419,842 387,578 34,255
Euros 7,236 – 7,404 –
Other currencies 783 5,988 – –
Non-indexed Ch$ > – – >
UF. 5,887 – 6,192 –
Finance lease 35,111 92,650 5,167 16,343
US Dollars 9,478 27,224 2,887 9,560
Euros – – – –
Other currencies 30 242 – –
Non-indexed Ch$ 21,448 52,661 542 1,700
UF. 4,155 12,523 1,738 5,083
Others 370 11,489 371 10,096
US Dollars – 25,928 – 10,096
Euros – (7,238) – –
Other currencies – (1,050) 34 –
Non-indexed Ch$ 370 – 337 –
UF. – (6,151) – –
Other current liabilities 2,523,372 21,234 2,637,403 29,732
US Dollars 1,405,729 36 1,428,033 13
Euros 77,103 – 99,937 –
Other currencies 9,467 – 9,792 –
Non-indexed Ch$ 1,020,115 20,857 1,087,657 29,719
UF. 10,958 341 11,984 –

118
CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

12/31/2019 12/31/2018
Non-current liability by currency 1to3 3to5 5to 10 More than 1to3 3to5 5to 10 More than
years years years 10 years years years years 10 years
Thus$ ThUS$ ThUS$ ThUs$ ThUS$ Thus$ Thus$ ThUSs$

Non-Current liabilities 7,366,038 1,204,628 5,517,333 10,698,988 6,804,312 2,260,258 5,142,419 8,000,535
US Dollars 6,868,702 366,261 5,249,173 8,965,313 6,396,888 2,114,245 4,160,204 6,918,087
Euros – 666,384 (672,798) – 14 – (7,832)

Other currencies 788 – – 608,656 1 – – –
Non-indexed Ch$ 456,079 154,879 247,001 548,174 390,088 141,392 277,356 505,603
UF. 40,469 17,104 693,957 576,845 17,321 4,621 712,691 576,845
Other non-current financial

liabilities 2,053,813 1,079,441 5,259,536 8,145,433 1,710,559 2,118,866 4,847,087 5,997,998
US Dollars 1,950,557 366,261 5,224,934 7,536,777 1,702,164 2,114,245 4,142,228 5,997,998
Euros – 666,384 (672,798) – – – (7,832)

Other currencies 378 – – 608,656 – – –

Non-indexed Ch$ 75,474 29,692 13,538 – 219 – –

UF. 27,404 17,104 693,862 – 8,176 4,621 712,691 –
Bank loans 1,195,172 668,991 544,104 548,454 677,507 298,250 582,867
US Dollars 1,195,172 668,991 544,104 548,454 677,507 298,250 582,867
Euros – – – – – –

Other currencies – – – – – –

Non-indexed Ch$ – – – – – –

UF. – – – – – – – –
Obligations 637,298 998,572 4,380,159 7,601,329 1,065,419 1,414,296 4,415,461 5,415,131
US Dollars 637,298 332,188 3,715,011 6,992,673 1,065,419 1,414,296 3,034,864 5,415,131
Euros – 666, 384 – – – – 678,446

Other currencies – – 608,656 – – –

Non-indexed Ch$ – – – – – –

UF. – – 665,148 – – – 702,151

Finance Lease 162,842 80,869 61,399 – 32,714 27,063 26,552

US Dollars 59,589 34,073 19,400 – 24,322 22,442 16,012

Euros – – – – – –

Other currencies 378 – – – – – –

Non-indexed Ch$ 75,471 29,692 13,538 – 216 – –

UF. 27,404 17,104 28,461 – 8,176 4,621 10,540

Others 58,501 148,987 – 63,972 – 106,824

US Dollars 58,498 821,532 – 63,969 – 793,102

Euros – (672,798) – – – (686,278)

Other currencies – – – – – –

Non-indexed Ch$ 3 – – 3 – –

UF. – – 253 – – – – –
Other liabilities non-current 5,312,225 125,187 257,797 2,553,555 5,093,753 141,392 295,332 2,002,537
US Dollars 4,918,145 24,239 1,428,536 4,694,724 – 17,976 920,089
Euros – – – 14 – –

Other currencies 410 – – – 1 – – –
Non-indexed Ch$ 380,605 125,187 233,463 548,174 389,869 141,392 277,356 505,603
UF. 13,065 95 576,845 9,145 – – 576,845

119
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

32. Sanctions

33.

As of December 31, 2019 and 2018, neither Codelco Chile nor its Directors and Managers have been
sanctioned by the CMF or any other administrative authorities.

Environmental Expenditures

Each of Codelco’s operations is subject to national, regional and local regulations related to protection of
the environment and natural resources, including standards relating to water, air, noise and disposal and
transportation of dangerous residues, among others. Chile has introduced environmental regulations that
have obligated companies, including Codelco, to carry out programs to reduce, control or eliminate
relevant environmental impacts. Codelco has executed and shall continue to execute a series of
environmental projects to comply with these regulations.

Pursuant to the Letter of Values approved in 2010, Codelco is governed by a series of internal policies
and regulations that frame its commitment to the environment, among which is the Corporate Sustainable
Development Policy (2016).

The environmental management systems of the divisions, structure their efforts in order to comply with the
commitments assumed by the corporation’s environmental policies, incorporating elements of planning,
operating, verifying and reviewing activities. As of December 31, 2019, Codelco is implementing a
strategic change process in all divisions to manage the aspects and risks associated with environmental
matters, under a corporate management system issued by Head Office, seeking to obtain the ISO 14001:
2015 certification.

In accordance with Supreme Decree D.S. No. 28, the Corporation is carrying out is environmental,
maintenance and operating plans for its smelting plants.

To comply with the Circular No. 1901 of 2008 of the CMF, the details of the Corporation’s main
expenditures related to the environment during the years ended December 31, 2019 and 2018,
respectively, and the projected future expenses are stated below.

120
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Disbursements 12/31/2019 12/31/2018 Future committed
Entity Proyect name Proyect status | Amount Asset Asset] Amount | Amount | Estimated
ThUS$ | Expense | Expenditure Item | ThUS$ ThUS$ date

Chuquicamata
Codelco Chile [Talambre dam capaci extension, Sth stage In Progress 76.611 | — Asset P.P8E 148,715 65,157 | — 2020
Codelco Chile [Emergency restoraon system dust control crushing plant 2/3 Finished | Asset P.P8E 345 – –
Codelco Chile [Replacementof circulation pot 1A and 2A In Progress 14,033 | — Asset P.P8E 1,370 6590 | 2020
Codelco Chile [Construction instalañon surplus management In Progress 761 | Asset P.P8E . 65| 2019
Codelco Chile [Replacementof water treatment plant In Progress 8,944 | — Asset P.P8E . 4822| 2019
Codelco Chile [Replacement gas management system In Progress 9,671| Asset P.P8E 745 1,724 | 2020
Codelco Chile [Acid plant tranformañon 3-4 DCIDA In Progress 160,546 | — Asset P.P8E 200,844 7291 | 2020
Codelco Chile: |Enablementreíning gas tealmentsystem In Progress 50,009 | — Asset P.P8E 26.973 28,504 | 2020
Codelco Chile [Dryer replacementn * 5 fuco In Progress 39,136 | — Asset P.P8E 23,204 16,603 | 2020
Codelco Chile [Management feeding and transport powders Finished | Asset P.P8E 1,363 – –
Codelco Chile [Construction Relle Res Don+Asim Montec In Progress 2,181 | — Asset P.P8E 599 8.408 | 2020
Codelco Chile [Construction IX stage Talambre tanque In Progress 9,542 | — Asset P.P8E 6,063 1601| 2019
Codelco Chile [Construction 8 Seg Montecristo In Progress 11,393 | — Asset P.P8E 799 7875| 2020
Codelco Chile [Acid plants In Progress 35.823 | Expendiure | — Adm. Expense 30.989 – | 2019
Codelco Chile [Solid waste In Progress 2.388 | Expendiure | — Adm. Expense 6.595 – | 2019
Codelco Chile [Taiings In Progress 23,153 | Expendiure | — Adm. Expense 23,047 – | 2019
Codelco Chile [Water treatment plant In Progress 25,143 | Expendiure | — Adm. Expense 17,501 – | 2019
Codelco Chile [Environmental monitoring In Progress 2,152 | Expendiure | — Adm. Expense 3.811 – | 2019
Codelco Chile [Normalizaton drainage system dril hole In Progress 4,551 | — Asset P.P8E . 6747 | 2020
Codelco Chile [Standard handing / feeding / tansportpowder In Progress 61| Asset P.P8E – 21505| 2021

Total Chuquicamata 476,098 492,963 177,082

Salvador
Codelco Chile [Improved integration ofthe gas process In Progress 87,710 | Asset P.P8E 91,755 45224 | 2020
Codelco Chile [Concentrator fler plant constucion Finished | Asset P.P8E 28 – –
Codelco Chile [Water capture improvement Finished | Asset P.P8E 147 – –
Codelco Chile [Tailngs In Progress 3,141 | Expendiure | — Adm. Expense 2,008 – | 2019
Codelco Chile [Acid plants In Progress 51,131 | Expendiure | — Adm. Expense 29,677 – | 2019
Codelco Chile [Solid waste In Progress 1,472 | Expenditure | — Adm. Expense 902 – | 2019
Codelco Chile. [Water treatment plant In Progress 855 | Expenditure | — Adm Expense 687 – | 2019
Codelco Chile [Overhaul hickeners taiings sal-proy In Progress 3,413 | — Asset P.P8E 1,443 510| 2019
Codelco Chile [Dangerous substances warehouse In Progress 301 | Asset P.P8E 82 – | 2019
Codelco Chile [Bell replacement In Progress 23,639 | — Asset P.P8E 11,185 5664 | 2020
Codelco Chile |Diteh hazardous waste In Progress 785 | Asset P.P8E 62 – | 2019
Codelco Chile [DRPA Emergency In Progress 4,564 | — Asset P.P8E 177 22,205 | 2020
Codelco Chile [Compliance DS 43 storage dangerous substances In Progress 68| Asset P.P8E – 2213| 2020

Total Salvador 177,079 138,153 75,906

Andina
Codelco Chile [Drain water treatment Finished | Asset P.P8E 171 – –
Codelco Chile [Water Normatve Phase 2 Finished | Asset P.P8E 1,274 – –
Codelco Chile [Constucion site emergency plan In Progress 3.886 | — Asset P.P8E 11,176 541| 2019
Codelco Chile [Constucion site emergency plan Finished | Asset P.P8E 5,975 – –
Codelco Chile: [Improved water internal ip E2 In Progress 256| Asset P.P8E 2.620 – | 2019
Codelco Chile [Constucion early alert plan Finished | Asset P.P8E – – –
Codelco Chile |Implementaton in RCA compliance wells (Hydraulic Barrier) Finished | Asset P.P8E 3,010 – –
Codelco Chile [Catchment water drainage hil black In Progress 306 | Asset P.P8E 2,301 – | 2019
Codelco Chile [Construction canal outine DL east In Progress 5,133| — Asset P.P8E 6,136 9,725| 2021
Codelco Chile [Standard fuel supply system Finished | Asset P.P8E 258 – –
Codelco Chile [Constucion site emergency plan In Progress 4,436 | Asset P.P8E 7,942 3675| 2020
Codelco Chile [Oo Sbr Level 640 Msnm Trang Finished | Asset P.P8E 16,720 – –
Codelco Chile [Expansion dam In Progress 49,430 | — Asset P.P8E – 63,343 | 2020
Codelco Chile [Constucion Stucture and instuments In Progress 378| Asset P.P8E . 2972 | 2020
Codelco Chile [Water injecion system In Progress 761 | Asset P.P8E . 89| 2019
Codelco Chile [construcion of pits containmentof pills In Progress 441| Asset P.P8E . 804| 2020
Codelco Chile [Valve and works raing In Progress 1,097 | — Asset P.P8E . 4,037 | 2020
Codelco Chile [Collection tower constucion No. 5 In Progress 336 | Asset P.P8E 173 2019
Codelco Chile [Solid waste In Progress 2.833 | Expendiure | — Adm. Expense 2,735 – | 2019
Codelco Chile [Water treatment plant In Progress 4,063 | Expenditre | — Adm Expense 3,927 – | 2019
Codelco Chile [Trailng In Progress 65.557 | Expendiure | — Adm. Expense 68.220 – | 2019
Codelco Chile [Acid drainage In Progress 27.615 | Expendiure | — Adm. Expense 30.894 – | 2019
Codelco Chile [Environmental monitoring In Progress 882 | Expenditure | — Adm Expense 554 – | 2019
Codelco Chile |Sustainabilty and external maters management In Progress 2,410 | Expendiure | — Adm. Expense 2.880 – | 2019
Codelco Chile [DLN conditoning works In Progress 8| Asset P.P8E – 18,667 | — 2021
Codelco Chile [Construction works miigaton water shortage In Progress 7,605 | — Asset P.P8E . 20,638 | 2021
Codelco Chile |Excavaton operation improvement In Progress 34| Asset P.P8E . 3645| — 2021
Codelco Chile [Water dispatch tunnel modifcaton In Progress 34| Asset P.P8E – 6969| 2021

Total Andina 177,501 166,793 135.278
Subtotal 830,678 797,909 388,266

121

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Disbursements 12/31/2019 12/31/2018 Future committed
Entity Proyect name Amount Asset Asset] Amount Amount | Estimated
ThuS$ | Expense | Expenditure Item | ThUS$ ThUS$ date
El Teniente
Codelco Chile [Construction of7h phase of Carén In Progress 58,357 | — Asset P.P8E 27.866 234,149 | — 2022
Codelco Chile [Construction of6h phase of Carén Finished | Asset P.P8E . – –
Codelco Chile [Construction ofslag treatment plant In Progress 122,158 | — Asset P.P8E 108,854 98,653 | 2020
Codelco Chile [Construction ofslag treatment plant Finished | Asset P.P8E 19,749 – –
Codelco Chile [Smeting emissions network In Progress 26.393 | — Asset P.P8E 51,273 2236 | 2020
Codelco Chile [Smoke capaciy reduction Finished | Asset P.P8E 5.579 – –
Codelco Chile [Smoke capacity reduction In Progress 11412 | — Asset P.P8E 38,749 1,944 | — 2019
Codelco Chile [Construction ofslag treatment plant In Progress 843 | Asset P.P8E 1,650 1611 | 2020
Codelco Chile [Acid plants In Progress 66,348 | Expendiure | — Adm. Expense 66.294 – | 2019
Codelco Chile [Solid waste In Progress 2,929 | Expendiure | — Adm. Expense 4,460 – | 2019
Codelco Chile [Water treatment plant In Progress 13,786 | Expenditure | — Adm. Expense 16,688 – | 2019
Codelco Chile [Taiings In Progress 65,003 | Expendiure | Adm. Expense 66.632 – | 2019
Codelco Chile [Well constucion and hydrogeology modifcaton Colitue-Cauquenes In Progress 18| Asset P.P8E . 4868 | 2022
Codelco Chile |Improvementofthe container washing system for fer plants In Progress 231| Asset P.P8E . 451 | 2020
Total El Teniente 367,478 407,794 343,912
Gabriela Mistral
Codelco Chile [Environmental monitoring In Progress 54 | Expenditure | Adm. Expense 6 – | 2019
Codelco Chile [Solid waste In Progress 2,031 | Expendiure | — Adm. Expense 2,420 – | 2019
Codelco Chile [Environmental consultancy In Progress 131 | Expenditure | — Adm Expense 2,087 – | 2019
Codelco Chile. [Water treatment plant In Progress 1 | Expenditure | — Adm Expense 106 – | 2019
Codelco Chile [Garbage dump extension In Progress 25.270| — Asset P.P8E 7.446 9,137 | 2020
Codelco Chile [Improved dust collecion system In Progress 382 | Asset P.P8E 61 – | 2019
Total Gabriela Mistral 27,869 12,126 9,137
Ventanas
Codelco Chile [Constucion new warehouse ofconcentrate Finished | Asset P.P8E 2,072 – –
Codelco Chile [Acid plants In Progress 24,694 | Expendiure | — Adm. Expense 30.514 – | 2019
Codelco Chile [Solid waste In Progress 1,689 | Expenditure | — Adm. Expense 1,908 – | 2019
Codelco Chile [Environmental monitoring In Progress 1,362 | Expenditure | — Adm. Expense 1,586 – | 2019
Codelco Chile [Water treatment plant In Progress 5,573 | Expendiure | — Adm. Expense 5,340 – | 2019
Codelco Chile [Disribuion systemreplacement In Progress TIO | Asset P.P8E 2,072 569| 2019
Codelco Chile [Main chimey implementaton In Progress 474 | Asset P.P8E . 714| 2020
Codelco Chile [Implementation of abatement water system In Progress 239| Asset P.P8E . 725| 2020
Codelco Chile [Stockpite improvement In Progress 525| Asset P.P8E . 828| 2020
Codelco Chile: [Improvement closure faciles and crusher belts In Progress 219| Asset P.P8E . 72 | 2020
Codelco Chile [Stabiized road operations In Progress 211| Asset P.P8E . 447 | 2020
Total Ventanas 35,756 43,492 4,005
¡Radomiro Tomic
Codelco Chile [Solid waste In Progress 2,031 | Expenditure | — Adm. Expense 1,132 – | 2019
Codelco Chile [Environmental monitoring In Progress 54 | Expenditure | Adm. Expense 725 – | 2019
Codelco Chile. [Water treatment plant In Progress 1 | Expenditure | — Adm Expense 949 – | 2019
Total Radomiro Tomic 2,086 2,806 –
Ministro Hales
Codelco Chile [Solid waste In Progress 1,961 | Expenditure | — Adm Expense 664 – | 2019
Codelco Chile [Environmental monitoring In Progress – | Expenditure | — Adm. Expense 664 – | 2019
Codelco Chile [Water treatment plant In Progress 159 | Expenditure | — Adm Expense 180 – | 2019
Codelco Chile |Pitdrainage wells mine In Progress 3,148 | — Asset P.P8E 10 3213| 2020
Codelco Chile [Implementation monitoring acuifero pit In Progress 173 | Asset P.P8E 11 2.866 | 2020
Codelco Chile [Silice barn extension and dome control room In Progress 45| Asset P.P8E – 4,130 | — 2021
Total Ministro Hales 5.486 1,529 10,209
Ecometales Limited
Codelco Chile [Smeting powders leaching plant In Progress 730 | Expenditure | — Adm Expense 613 548| 2020
Codelco Chile [Smeling powders leaching plant In Progress 7 | Expenditure | — Adm. Expense 8 8| 2020
Total Ecometales Limited 737 621 556
Subtotal 439,412 468,368 367,819
[Total [1,270,090 [ [1,266,277] 756,085 |

122

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

34. Subsequent events

– On January 7, 2020, the Corporation reported an essential fact that on such date Don Roberto
Ecclefield Escobar, current Vice President of Marketing has submitted his resignation to the
Corporation, which will become effective on February 1, 2020.

– On January 7, 2020, the Corporation reported as an essential fact that Codelco accessed the
international financial markets, through the placement of bonds in New York for US$1 billion for 10
years and US$1 billion for 30 years, through a reopening of the 30-year bond issued in September
2019, with yields of 3.175% and 3.958%, respectively. The rates represent spreads of 135 and 165
basis points on the American Treasury bond in each term. With this operation, Codelco’s net debt is
not increased and a new step is taken to a sustainable financing of the investment portfolio, in
accordance with the guidelines given by the Board of Directors with respect to progress in the
materialization of structural projects while maintaining a solid financial position.

The issuance was led by banks HSBC Securtires (USA) Inc., JP Morgan Securities LLC, BofA
Securities, and Scotia Capital (USA) Inc.

– On January 9, 2020, the Corporation reported as an essential fact, in accordance with the provisions of
Circular No. 1,072, detail of the financing operation carried out on January 7, 2020.

– On January 29, 2020, the Corporation reported as an essential fact that S.E. the President of the
Republic has designated as Director of Codelco, Mr. Rodrigo Cerda Norambuena, replacing Mr.
Ignacio Briones Rojas.

– On January 31, 2020, the Corporation reported as an essential fact that Ms. Lorena Ferreiro Vidal has
been appointed as Codelco’s Legal Counselor from March 1, 2020.

From such date, Ms. María Francisca Dominguez M. finishing practicing as Interim Legal
Counselor.and will continue serving as Legal Director of the Corporation.

– On January 31, 2020, the Corporation reported as an essential fact, the creation of the Vice
Presidency of Smelters and Refinery, reporting to the Executive President. From March 2020, Mr. José
Sanhueza Reyes, who served up to such date, as General Manager of the Ventanas Division, was
appointed Vice President in charge. Likewise, from such date, Mr. Gerardo Sanchez, is appointed as
General Manager of the Ventanas Division.

– On February 28, 2020 and in relation to PE – 015/2020 dated January 31, 2020, the Corporation
reported as an essential fact, that Mr. Gerardo Sánchez Sepúlveda will continue to serve as Manager
of the Caletones Foundry of the El Teniente Division, for such reason, as of March 1, 2020, Mr.
Cristián Cortés Egaña will assume in an interim capacity the position of General Manager of the
Ventanas Division.

123
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

– On March 2, 2020, the Corporation reported as an essential fact, the appointment of Don Patricio
Vergara Lara, as Vice President of Mining Resources and Development Management, from April 20,
2020.

– On March 11, 2020, the World Health Organization characterized the outbreak of a strain of the new
coronavirus (“COVID-19”) as a pandemic that has resulted in a series of public health and emergency
measures that have been put in place and are underway to combat the spread of the virus. The
duration and impact of COVID-19 are unknown at this time and it is not possible to reliably estimate the
impact of the duration and severity of these developments in future periods.

For several weeks now, Codelco has been permanently monitoring the aforementioned outbreak, its
constant evolution, eventual impact on the Corporation’s financial and operational indicators, possible
effects on our workers, clients, suppliers, as well as collaborating with government actions that are
being taken to reduce its spread, with no material impact observed to date on its ability to meet its
financial, production or sale commitments. The foregoing is without prejudice to the impact on world
demand for copper, which has meant a decrease in the price, which is public knowledge.

Particularly, in relation to the Corporation’s liquidity levels, and as a result of the last financing carried
out in January this year, the Corporation finds itself in a solid cash position, which allows it to absorb
the short-term negative impacts on the price of copper.

Thus, we cannot currently estimate the overall duration of any resulting adverse impact on our
business, financial condition and / or results of operations as well as its degree of materiality. However,
given some scenarios that could materialize in the coming months, we cannot rule out that our financial
results may be negatively affected by this contingency.

– On March 23, the Ministry of Finance issued Ordinary Letter No. 843, which modifies the payment
method of the Law 13,196 funds to meet national needs generated by the COVID-19 crisis.

Said Official Letter establishes the full amount of funds owed to the Treasury for the application of Law
No. 13,196, equivalent to TRUS$240,168 (contribution for December 2019, January and February
2020), before March 31 this year. Subsequently and from the month of April, the Corporation should
carry out the monthly transfer of the corresponding resources according to their recordkeeping, within a
period not exceeding the last day of the month following its booking.

Before the amendment established in this document, the payment method of the funds associated to
Law 13,196, consisted in an annual payment no later than December 15 of each year.

– On March 25, the Corporation announced that it will temporarily suspend some of its projects, as part
of the measures to prevent the spread of Coronavirus. The suspension will be carried out gradually
starting from March 25 and will last for 15 days. Specifically, it deals with the construction of the
remaining works of the Chuquicamata Underground Mine Project, the early works of Rajo Inca and the
assembly works of Traspaso Andina. This measure has no impact on the production of the respective
divisions that maintain operational continuity with the largest sanitary safeguards.

124
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Management of the Corporation is not aware of other significant events of a financial nature or of any
other nature that could affect these financial statements, occurring between January 1, 2020 and the date
of issue of these consolidated financial statements as of March 26, 2020.

Octavio Araneda Osés Alejandro Rivera Stambuk
Chief Executive Officer Chief Financial Officer

Javier Tapia Avila Juan Ogas Cabrera

Accounting and Finance Control Manager Accounting Director

125
CORPORACION NACIONAL
DEL COBRE DE CHILE

Consolidated Financial Statements
As of and for the years ended December 31, 2018 and 2017
m
Deloitte. os

Auditores y Consultores Limitada
Rosario Norte 407

Rut: 80.276.200-3

Las Condes, Santiago

Chile

Fono: (56) 227 297 000

Fax: (56) 223 749 177
deloittechileOdeloitte.com
www.deloitte.cl

INDEPENDENT AUDITORS” REPORT

To the Chairman and Board of Directors of
Corporación Nacional del Cobre de Chile

We have audited the accompanying consolidated statements of financial position of Corporación
Nacional del Cobre de Chile and its subsidiaries (the “Company”) at December 31, 2018 and 2017, and
the related consolidated statements of comprehensive income, changes in equity and cash flows for the
years then ended and the related notes to the consolidated financial statements.

Management’s Responsibility for the Consolidated Financial Information

Management is responsible for the preparation and fair presentation of these consolidated financial
statements in accordance with International Financial Reporting Standards as issued by the
International Accounting Standards Board (“IASB”). This responsibility includes the design,
implementation, and maintenance of internal control relevant to the preparation and fair presentation of
consolidated financial statements that are free from material misstatement, whether due to fraud or
error.

Auditor”s Responsibility

Our responsibility is to express an opinion on these consolidated financial statements based on our
audits. We performed our audits in accordance with auditing standards generally accepted in Chile.
Those standards require that we plan and perform the audit to obtain reasonable assurance about
whether the consolidated financial statements are free from material misstatement.

An audit includes performing procedures to obtain audit evidence about the amounts and disclosures in
the consolidated financial statements. The procedures selected depend on the auditor”s judgment,
including the assessment of the risks of material misstatement of the consolidated financial statements,
whether due to fraud or error. In making those risk assessments, the auditor considers internal control
relevant to the preparation and fair presentation of the entity’s consolidated financial statements in
order to design audit procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the entity”s internal control. Accordingly, we express no
such opinion. An audit also includes assessing the appropriateness of the accounting policies used and
the reasonableness of the significant estimates made by the Company’s Management, as well as
evaluating the overall presentation of the consolidated financial statements.

We believe that the audit evidence that we have obtained is sufficient and appropriate to provide a
basis for our audit opinion.

Deloitte? se refiere a Deloitte Touche Tohmatsu Limited una compañía privada limitada por garantía, de Reino Unido, y a su red de firmas miembro, cada una de las cuales es una
entidad legal separada e independiente. Por favor, vea en www.deloitte.com/c//acercade la descripción detallada de la estructura legal de Deloitte Touche Tohmatsu Limited y sus
firmas miembro.

Deloitte Touche Tohmatsu Limited es una compañía privada limitada por garantía constituida en Inglaterra 8: Gales bajo el número 07271800, y su domicilio registrado: Hill House,
1 Little New Street, London, EC4A 3TR, Reino Unido.
Opinion

In our opinion, the consolidated financial statements referred to above present fairly, in all material
respects, the financial position of Corporación Nacional del Cobre de Chile and its subsidiaries as of
December 31, 2018 and 2017, and the results of their operations and their cash flows for the years then
ended in accordance with International Financial Reporting Standards as issued by the International
Accounting Standards Board.

Other-matter — Translation

The accompanying consolidated financial statements have been translated into English solely for the
convenience of readers outside of Chile.

arch 28, 2019
Santiago, Chile
O

CODELCO

CODELCO – CHILE

Consolidated Financial Statements as of and for the years ended December 31,
2018 and 2017

(Translation into English of the consolidated financial statements originally issued
in Spanish — see Note 1.2)
TABLE OF CONTENTS
CONSOLIDATED FINANCIAL STATEMENTS
(Translation into English of the consolidated financial statements originally issued in Spanish – see Note 1.2)

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)..
CONSOLIDATED STATEMENTS OF CASH FLOWS – DIRECT METHOD
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY ……………..

L GENERAL INFORMATION

1. Corporate Information
2. Basis of Presentation of the Consolidated Financial Statements

ll. SIGNIFICANT ACCOUNTING POLICIES

1. Significant Judgments and Key Estimates
2. Significant accounting policies ……………o.oo.o..

3. New standards and interpretations adopted by the Corporation
4. New accounting pronouncements

lll… EXPLANATORY NOTES

1. Cash and cash equivalents

2. Trade and other receivables…………… .42
3. Balance and transactions with related parties .. .44
4. InventorieS oo.ooococcnnanonnnnnnnnnoncnanacananos .50
5. Income taxes and deferred taxes…….. .51
6. Current and non-current tax assets and liabilities. .53
7. Non-current assets or groups of assets for disposition classified as held for sale… .54
8. Property, Plant and EquipMeNt ….oonnccononcononanconenconannnrnnoncnrnonoraccorinonnos .54
9. Investments accounted for using the equity . .58
10. Intangible assets other than goodwil! ….. .65

11. SubsidiarieS …….ococonnnosmmm>**«”*”.
12. Other non-current non-financial assets
13. Current and non-current financial assets
14. Interest-bearing borrowings……………….
15. Fair Value of financial assets and liabilities .
16. Fair value hierarchy…….

17. Trade and other payables .. .79
18. Other provisions ……. .79
19. Employee benefits .80
20. Equity ………. 84

21. Revenue…
22. Expenses by nature…
23. Impairment of Assets
24. Other income and expenses by function.
25. Finance COSÉS .onononoconononononanananananananos .90
26. Operating segments……….
27. Foreign exchange differences
28. Statement of cash flOWS ………cococonooososos
29. Financial risk management, objectives and policies .
30. Derivatives CONtractS ……ocooconommmmsm.m. … 102
31. Contingencies and restrictiONS………..occocnnnennncnsnsnnennncononconannacononcornnoronon conoce rnnno ro nro nora ro rn aro rn nao rara rnrnnnoss 105

32.
33.
34.
35.
36.

Guarantees

Balances in foreign currency
SanctionS …………..
Environmental Expenditures

Subsequent events

CORPORACION NACIONAL DEL COBRE DE CHILE
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
As of December 31, 2018 and 2017
(In thousands of US dollars – TRUS$)
(Translation into English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

12/31/2018 12/31/2017
Notes
Assets
Current Assets
Cash and cash equivalents 1 1,229,125 1,448,835
Other current financial assets 13 231,409 1,327
Other current non-financial assets 6,805 25,638
Trade and other current receivables 2 2,212,209 2,815,352
Accounts receivable from related parties, current 3 92,365 64,344
Inventories 4 2,042,648 1,829,698
Current tax assets 6 13,645 21,623
Total current assets other than assets or groups of assets for
disposition classified as held for sale or held as distributable to 5,828,206 6,206,817
owners
Non-current assets or groups of assets for disposition classified
7 – 4,236
as held for sale
[Total current assets 5,828,206 6,211,053 ]
Non-current assets
Other non-current financial assets 13 145,751 149,526
Other non-current non-financial assets 12 6,817 11,575
Non-current receivables 2 84,731 91,442
Accounts receivable from related parties, non-current 3 20,530 25,830
Non-current inventories 4 457,070 428,447
Investments accounted for using equity method 9 3,568,293 3,665,601
Intangible assets other than goodwill 10 48,379 219,117
Property, plant and equipment 8 26,754,998 25,275,512
Investment property 981 981
Non-current tax assets 6 143,606 233,772
Deferred tax assets 5 31,443 43,285
Total non-current assets 31,262,599 30,145,088
Total Assets 37,090,805 36,356,141

The accompanying notes are an integral part of these consolidated financial statements.
CORPORACION NACIONAL DEL COBRE DE CHILE
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
As of December 31, 2018 and 2017
(In thousands of US dollars – TRUS$)
(Translation into English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

12/31/2018 12/31/2017
Notes
Liabilities and Equity
Liabilities
Current liabilities
Other current financial liabilities 14 872,277 324,388
Trade and other current payables 17 1,546,584 1,915,768
Accounts payable to related parties, current 3 150,916 123,791
Other current provisions 18 384,249 324,631
Current tax liabilities 6 10,777 58,690
Current provisions for employee benefits 19 510,034 516,681
Other current non-financial liabilities 64,575 51,507
[Total current liabilities 3,539,412 3,315,456 |
Non-current liabilities
Other non-current financial liabilities 14 14,674,510 14,648,004
Non-current payables 26,613 44,983
Other non-current provisions 18 1,600,183 1,711,802
Deferred tax liabilities 5 4,586,168 4,314,237
Non-current provisions for employee benefits 19 1,315,520 1,392,659
Other non-current non-financial liabilities 4,530 3,662
Total non-current liabilities 22,207,524 22,115,347
Total liabilities 25,746,936 25,430,803
Equity
Issued capital 20 5,219,423 4,619,423
Accumulated deficit (198,917) (36,672)
Other reserves 20 5,354,159 5,335,092
[ Equity attributable to owners of the parent 10,374,665 9,917,843 |
Non-controlling interests 20 969,204 1,007,495
Total equity 11,343,869 10,925,338
[Total liabilities and equity 37,090,805 36,356,141 |

The accompanying notes are an integral part of these consolidated financial statements.
CORPORACION NACIONAL DEL COBRE DE CHILE
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
For the years ended December 31, 2018 and 2017

(In thousands of US dollars – TRUS$)
(Translation into English of the consolidated financial statements originally issued in Spanish — see

Note 1.2)

Notes 1/1/2018 1/1/2017
N? 12/31/2018 12/31/2017

Revenue 21 14,308,758 14,641,555
Cost of sales (11,194,341) (10,380,403)
[Gross profit 3,114,417 4,261,152
Other Income, by function 24.a 124,826 154,332
Impairment gain and reversal of impairment loss determined in accordance with IFRS 9 158 –
Distribution costs (18,262) (10,403)
Administrative expenses (465,328) (428,140)
Other expenses 24.b (2,115,314) (1,557,473)
Other gains 21,395 32,605
[Income from operating activities 661,892 2,452,073
Finance income 51,329 29,836
Finance costs 25 (463,448) (644,610)
Share of profit of associates and joint ventures accounted for using equity method 9 119,114 185,428
Foreign exchange difference 27 178,143 (206,058)
[Income for the years before tax 547,030 1,816,669
Expense – income Taxes 5 (357,283) (1,193,067)
[Net income for the years 189,747 623,602
Net income attributable to owners of parent 155,719 569,175
Net income attributable to non-controlling interests 20.b 34,028 54,427
189,747 623,602

[Net income for the years

The accompanying notes are an integral part of these consolidated financial statements.
CORPORACION NACIONAL DEL COBRE DE CHILE
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
CONTINUED
For the years ended December 31, 2018 and 2017
(In thousands of US dollars – TRUS$)
(Translation into English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Notes 1/1/2018 1/1/2017
N* 12/31/2018 12/31/2017

[Net income for the years 189,747 623,602
Components of other comprehensive income that will not be reclassified to profit or loss,

before tax:

(Losses) gains on remeasurement of defined benefit plans, before tax (48,626) 25,106
Share of other comprehensive (loss) income of associates and joint ventures accounted for using the (1,617) 193
equity method that will not be reclassified to profit or loss before tax ‘

Other comprehensive (loss) income that will not be reclassified to profit or loss before tax (50,243) 25,229
Components of other comprehensive income that will be reclassified to profit or loss, before

tax

(Losses) gains on exchange difference on translation, before tax (848) 4,592
Gains (losses) on cash flow hedges, before tax 104,160 (2,874)
Share of other comprehensive income (loss) of associates and joint ventures accounted for using 554 (604)
equity method that will be reclassified to profit or loss, before tax

Other comprehensive income that will be reclassified to profit or loss before tax 103,866 1,114
Other comprehensive income, before tax 53,623 26,343
Net income tax effect of components of other comprehensive income which will not be

reclassified to profit or loss:

Income tax effect relating measurement of defined benefit plans in other comprehensive income 5 33,148 (16,937)
Net income (loss) tax of components of other comprehensive income which will be reclassified

to profit or loss:

Income tax effect relating to cash flow hedges of other comprehensive income 5 (67,704) 1,868
Total other comprehensive income 19,067 11,274
Total Comprehensive Income 208,814 13,142
Comprehensive income attributable to:

Comprehensive income attributable to owners of the parent 174,786 580,449
Comprehensive income attributable to non-controlling interests 20.b 34,028 54,427
[Total comprehensive Income 208,814 634,876

The accompanying notes are an integral part of these consolidated financial statements.
CORPORACION NACIONAL DEL COBRE DE CHILE
CONSOLIDATED STATEMENTS OF CASH FLOWS – DIRECT METHOD
For the years ended December 31, 2018 and 2017

(In thousands of US dollars – TRUS$)
(Translation into English of the consolidated financial statements originally issued in Spanish – see Note 1.2)

Notes 1/1/2018 1/1/2017
12/31/2018 12/31/2017
Cash flows provided by operating activities:
Receipts from sales of goods and rendering of services 15,428,893 14,521,538
Other cash receipts from operating activities 28 1,733,555 1,657,104
Payments to suppliers for goods and services (8,870,763) (7,822,093)
Payments to and on behalf of employees (1,920,204) (1,614,446)
Other cash payments from operating activities 28 (2,555,184) (2,223,368)
Dividends received 188,749 227,843
Income taxes paid (67,326) (31,224)
| Cash flows provided by operating activities 3,937,720 4,715,354
Cash flows used in investing activities:
Other payments to acquire equity or debt instruments of other entities (338) –
Other charges for the sale of interests in joint ventures and associates 7 21,842 –
Purchase of property, plant and equipment (3,893,851) (3,411,496)
Interest received 47,259 15,290
Other outflows of cash (127,570) (49,897)
| Cash flows used in investing activities (3,952,658) (3,446,103)
Cash flows used in financing activities:
Total proceeds from borrowings 900,000 3,050,000
Repayment of borrowings (259,011) (3,375,216)
Payments of finance lease liabilities classified as financing activities (27,130) (25,565)
Dividends paid (602,461) (273,332)
Interest paid (634,289) (582,471)
Other cash inflow 500,802 790,149
Cash flows used in financing activities (122,089) (416,435)
Decrease) Increase in cash and cash equivalents before effect of exchange (137,027) 852.816
Effect of exchange rate changes on cash and cash equivalents (82,683) 19,293
(Decrease) increase in cash and cash equivalents (219,710) 872,109
Cash and cash equivalents at beginning of years 1 1,448,835 576,726
Cash and cash equivalents at end of years 1 1,229,125 1,448,835

The accompanying notes are an integral part of these consolidated financial statements.
CORPORACION NACIONAL DEL COBRE DE CHILE
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
For the years ended December 31, 2018 and 2017
(In thousands of US dollars – TRUS$)
(Translation into English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Reserve of
Reserve on exchange remeasuement of Other Eauly
December 31, 2018 O O a A rccmuis att o
sud cepl translation edges P reserves Total other ao O Total Equiy
reserves et parent interests
Note 19 Note 20 Note 20
Initial balance as of 1/1/2018 4,619,423 (6,015)| 11,336 (259,002)| 5,588,773 5,335,092 (36,672)| 9,917,843 1,007,495 10,925,338
Increase (decrease) through changes in accounting policies 2,282 2,282 – 2,282
Initial balance restated 4,619,423 (6,015)| 11,336 (259,002)| 5,588,773 5,335,092 (34,390)| 9,920,125 1,007,495 10,927,620
Changes in equity:
Net income 155,719 155,719 34,028 189,747
Other comprehensive income (loss) (848)| 36,456 (15,478)! (1,063)! 19,067 19,067 – 19,067
Comprehensive income 174,786 34,028 208,814
Dividends (306,619) (806,619) (306,619)
Capital increases 600,000 – – – – – – 600,000 – 600,000
Increase (decrease) through transfers and other changes – – – – – – (13,627)| (13,627)! (72,319)! (85,946)!
Total changes in equity 600,000 (848) 36,456 (15,478) (1,063) 19,067 (164,527)| 454,540 (88,291)| 416,249
Final balance as of 12/31/2018 5,219,423 (6,863)| 47,792 (274,480)| 5,587,710 5,354,159 (198,917)| 10,374,665 969,204 11,343,869
Reserve of Equiy
Reserve on exchange remeasurement of Other a
Reserve of cash fow| attibutable to
D ber 31, 2017 dif defined benefit ll
‘acamber Issued capital da hedges plans Doa Total other Acum oa the Nor-conteling Total Equiy
reserves interests
Note 19 Note 20 Note 20
Initial balance as of 1/1/2017 3,624,423 (10,607) 12,342 (267,171)| 5,582,828 5,317,392 (30,072)| 8,911,743 978,666 9,890,409
Changes in equity:
Net income 569,175 569,175 54,427 623,602
Other comprehensive income (loss) 4,592 (1,006) 8,169 (481) 11,274 11,274 – 11,274
Comprehensive income 580,449 54,427 634,876
Dividends (569,175) (569,175) (569,175)
Capital Increases 995,000 – – – – – – 995,000 – 995,000
Increase (decrease) through transfers and other changes – – – 6,426 6,426 (6,600)| (174) (25,598) (25,772)|
Total changes in equity 995,000 4,592 (1,006) 8,169 5,945 17,700 (6,600)| 1,006,100 28,829 1,034,929
Final balance as of 12/31/2017 4,619,423 (6,015) 11,336 (259,002)| 5,588,773 5,335,092 (36,672)| 9,917,843 1,007,495 10,925,338

The accompanying notes are an integral part of these consolidated financial statements.

10
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

GENERAL INFORMATION
Corporate Information

Corporación Nacional del Cobre de Chile (hereinafter referred to as “Codelco”, “Codelco – Chile”, or the
“Corporation”), is, in Management’s opinion, the largest copper producer in the world. Codelco’s most
important product is refined copper, primarily in the form of cathodes. The Corporation also produces copper
concentrates, blister and anode copper and by-products such as molybdenum, anode slime and sulfuric
acid.

The Corporation trades ¡ts products based on a policy aimed to sell refined copper to manufacturers or
producers of semi-manufactured products.

These products contribute to diverse fields of community development, particularly those intended to
improve areas such as public health, energy efficiency, and sustainable development, among others.

Codelco-Chile is registered under Securities Registry No. 785 of the Chilean Commission for the Financial
Market (the “CMF”), and is subject to its supervision. According to Article No. 10 of Law No. 20392 (related
to the new Corporate Governance of Codelco), such supervision shall be on the same terms as publicly
traded companies, notwithstanding the provisions in Decree Law (D.L.) No.1349 of 1976, which created the
Comisión Chilena del Cobre (“Chilean Copper Commission”).

Codelco’s head office is located in Santiago, Chile, at 1270 Huérfanos Street, telephone number (56-2)
26903000.

Codelco was incorporated through D.L. No. 1350 of 1976, which is the statutory decree applicable to the
Corporation. In accordance with the statutory decree, Codelco is a government-owned mining, industrial
and commercial company, which is a separate legal entity with its own equity, Codelco Chile currently carries
out its mining business through its Chuquicamata, Radomiro Tomic, Ministro Hales, Gabriela Mistral,
Salvador, Andina, El Teniente and Ventanas divisions. The Gabriela Mistral division is in charge of the ore
deposit of the same name, whose operations were, until December 31, 2012, the responsibility of its
subsidiary Minera Gaby SpA., a wholly owned subsidiary of the Corporation which was absorbed by Codelco
on that date.

The Corporation also carries out similar activities in other mining deposits in association with third parties.

In accordance with letter e) of Article 10 of Law No. 20392, Codelco is governed by its organic standards
set forth in Decree Law No. 1350 (D.L. No. 1350) and that of its by-laws, and in matters not covered by them
and, insofar as they are compatible and do not contradict the provisions of such standards, by the rules that
govern publicly traded companies and the common laws as applicable to them.

In accordance with D.L. No. 1350 Section IV related to the Company’s Exchange and Budget Regulations.

Codelco’s financial activities are conducted following an annual budgeting program that is composed of an
Operations Budget, an Investment Budget and a Debt Amortization Budget.

11
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

2.

The tax system applicable to Codelco’s taxable income is in accordance with Article 26 of D. L. No.1350
which refers to Decree Law No. 824 on Income Tax of 1974 and Decree Law No. 2398 (Article 2) of 1978,
as applicable. The Corporation’s taxable income is also subject to a Specific Mining Tax in accordance with
Law No. 20026 of 2005.

The Corporation is subject to Law No. 13196, which mandates the payment of a 10% tax over the foreign
currency return on the actual sale revenue of copper production, including its by-products. On January 27,
2017, Law No. 20989, article 3, establishes changes in the application of Law No. 13196 as of January 1,
2018, through which the Corporation will deposit annually, no later than December 15 of each year, the
funds established in article 1 in that law.

The subsidiaries whose financial statements are included in these consolidated financial statements
correspond to companies located in Chile and abroad, which are detailed in Note 11.2.d.

The associates and joint ventures located in Chile and abroad, are detailed in the Explanatory Notes Section
II of Note 9.

Basis of Presentation of the Consolidated Financial Statements

The Corporation’s consolidated statements of financial position as of December 31, 2018 and 2017, and
the consolidated statements of comprehensive income for the years ended December 31, 2018 and 2017,
changes in equity and of cash flows for the years ended December 31, 2018 and 2017, have been prepared
in accordance with International Financial Reporting Standards (*IFRS”) as issued by the International
Accounting Standards Board (*lASB”).

These consolidated financial statements include all information and disclosures required in annual financial
statements.

These consolidated financial statements have been prepared from accounting records maintained by the
Corporation.

The consolidated financial statements of the Corporation are presented in thousands of United States dollar
(“U.S. dollar”).

Responsibility for the Information and Use of Estimates

The Board of Directors of the Corporation has been informed of the information included in these
consolidated financial statements and expressly declared its responsibility for the consistent and reliable
nature of the information included in such financial statements as of and for the year ended December 31,
2018, which financial statements fully comply with IFRS as issued by the lASB. These consolidated financial
statements as of December 31, 2018 and for the year then ended were approved by the Board of Directors
at a meeting held on March 28, 2019.

12
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Accounting Principles

These consolidated financial statements reflect the financial position of Codelco and its subsidiaries as of
December 31, 2018 and 2017, and the results of their operations for the years ended December 31, 2018
and 2017, changes in equity and cash flows for years ended December 31, 2018 and 2017, and their related
notes, all prepared in accordance with lAS 1, “Presentation of Financial Statements”, in consideration of
the presentation instructions of the Commission for the Financial Markets, where not in conflict with IFRS.

For the convenience of the reader, these consolidated financial statements and their accompanying notes
have been translated from Spanish into English.

13
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

SIGNIFICANT ACCOUNTING POLICIES

Significant Judgments and Key Estimates

In preparing these consolidated financial statements, the use of certain critical accounting estimates and
assumptions that affect the amounts of assets and liabilities recognized as of the date of the financial
statements and the amounts of revenue and expenses recognized during the reporting period is required.
Such preparation also requires the Corporation’s Management to exercise its judgment in the process of
applying the Corporation’s accounting policies. The areas involving a higher degree of judgment or
complexity, or areas where assumptions and estimates are significant to the consolidated financial
statements are as follows:

a)

b)

Useful economic lives and residual values of property, plant and equipment – The useful lives
and residual values of property, plant and equipment that are used for calculating depreciation are
determined based on technical studies prepared by specialists (internal or external). The technical
studies consider specific factors related to the use of assets.

When there are indicators that could lead to changes in the estimates of the useful lives of such assets,
these changes are made by using technical estimates considering specific factors related to the use of
the assets.

Ore reserves – The measurements of ore reserves are based on estimates of the ore resources that
are legally and economically exploitable, and reflect the technical and environmental considerations of
the Corporation regarding the amount of resources that could be exploited and sold at prices exceeding
the total cost associated with the extraction and processing.

The Corporation applies prudent judgment in determining the ore reserves, and as such, possible
changes in these estimates might significantly impact the estimates of net revenues over time. In
addition, these changes might lead to modifications in usage estimates, which might have an effect on
depreciation and amortization expense, calculation of stripping cost adjustments, determination of
impairment losses, expected future disbursements related to decommissioning and restoration
obligations, long term defined benefits plans’ accounting and the accounting for financial derivative
instruments.

The Corporation estimates ¡ts reserves and mineral resources based on the information certified by the
Competent Persons of the Corporation, who are defined and regulated according to Law No. 20235.
These estimates correspond to the application of the Certification Code of Ore Reserves, Resources
and Exploration, issued by the Mining Committee which was instituted through the aforementioned law.
This does not modify the global volume of the Corporation’s ore reserves and resources.

Notwithstanding the above, the Corporation also periodically reviews such estimates, supported by
world-class external experts, who certify the reserves as determined.

14
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

c) Impairment of non-financial assets – The Corporation reviews the carrying amount of its assets to
determine whether there is any indication that those assets have suffered an impairment loss. If any
such indicator exists, the recoverable amount of the assets is estimated in order to determine the extent
of the impairment loss. In testing impairment, the assets are grouped into cash generating units
(“CGUs”) to which the assets belong, where applicable. The recoverable amount of these CGUs is
calculated as the present value of the expected future cash flows from such assets, considering a pre-
tax discount rate that reflects current market assessments of the time value of money and the risks
specific to the asset. If the recoverable amount of the assets is lower than their carrying amount, an
impairment loss is recognized.

The Corporation defines the CGUs and also estimates the timing and cash flows that such CGUs will
generate. Subsequent changes in the grouping of the CGU, or changes in the assumptions supporting
the estimates of cash flows or the discount rate, may impact the carrying amounts of the corresponding
assets.

Estimates of assumptions influencing the calculation of cash flows, such as the price of copper or
treatment charges and refining charges, among others, are determined based on studies conducted
by the Corporation using uniform criteria over different periods. Any changes to these criteria may
impact the estimated recoverable amount of the assets.

The Corporation has assessed and defined that the CGUs are determined at the level of each of its
current operating divisions.

Impairment testing also is performed at the level of associates and joint arrangements.

d) Provisions for decommissioning and site restoration costs – The Corporation is obliged to incur
decommissioning and site restoration costs when such site restoration or decommissioning ¡is required
due to a legal or constructive obligation. Costs are estimated on the basis of a formal closure plan and
are reassessed annually or as of the date such obligations become known. The initial estimate of
decommissioning and site restoration costs is recognized as property, plant and equipment in
accordance with IAS 16, and simultaneously a liability in accordance with IAS 37, is recorded.

For these purposes, a defined list of mine sites, facilities and other equipment are studied under this
process, considering the engineering level profile, the cubic meters of assets that will be subject to
removal and restoration, weighted by a structure of market prices of goods and services, reflecting the
best current knowledge related to carrying out such activities, as well as techniques and more efficient
construction procedures to date. In the process of valuation of these activities, the assumptions of the
exchange rate for tradable goods and services is made, as well as a discount rate, which considers the
time value of money and the risks associated with the liabilities, which is determined based, where
applicable, on the currency in which disbursements are expected to be made.

The liability amounts recognized at the end of each reporting date represent management’s best

estimate of the present value of the future decommissioning and site restoration costs. Changes to
estimated future costs that result from changes in the estimated timing or amount of the outflow of

15
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

resources embodying economic benefits required to settle the obligation, or a change in the discount
rate are added to, or deducted from, the cost of the related asset in the current period (as well as the
associated liability). The amount deducted from the cost of the asset shall not exceed its carrying
amount. If a decrease in the liability exceeds the carrying amount of the asset, the excess is recognized
immediately in profit or loss.

If the adjustment results in an addition to the cost of the asset, Codelco considers whether this is an
indication that the new carrying amount of the asset may not be fully recoverable. If it is considered
such an indicator, Codelco tests the asset for impairment by estimating its recoverable amount, and
accounts for any impairment loss in accordance with IAS 36.

The decommissioning costs are initially recorded at the moment when a plant or other assets are
installed. Such costs are capitalized as part of property, plant and equipment and discounted to their
present value. These decommissioning costs are charged to net income over the life of the mine,
through depreciation of the corresponding asset. Depreciation expense ¡is included in cost of sales,
while the unwinding of the discount in the provision is included in finance costs.

e) Provisions for employee benefits – Provisions for employee benefits related to severance payments

and health benefits for services rendered by the employees are determined based on actuarial
calculations using the projected unit credit method, and are recognized in other comprehensive income
or profit or loss (depending on the accounting standards applicable).

The Corporation uses assumptions to determine the best estimate of future obligations related to these
benefits. Such estimates, as well as assumptions, are determined by management using the
assistance of external actuaries. These assumptions include demographic assumptions, discount rate
and expected salary increases and rotation levels, among other factors.

Accruals for open invoices – The Corporation uses information on future copper prices, through which
it recognizes adjustments to ¡ts revenues and trade receivables, due to the conditions in provisional
pricing arrangements. These adjustments are updated on a monthly basis, See Notes 2 r) “Revenue
from contracts with customers” of Note 2 “Significant accounting policies” below.

g) Fair value of derivatives and other financial instruments – Management may use its judgment to

choose an adequate and proper valuation method for financial instruments that are not quoted in an
active market. In the case of derivative financial instruments, assumptions are based on observable
market inputs, adjusted depending on factors specific to the instruments among others.

h) Lawsuits and contingencies – The Corporation assesses the probability of lawsuits and contingency

losses on an ongoing basis according to estimates performed by its legal advisors. For cases in which
management and the Corporation’s legal advisors believe that a loss is not probable of occurring or
where probable, may not be estimated reliably, no provisions are recognized.

Revenue recognition – Beginning on January 1, 2018, the Corporation has adopted IFRS 15,
Revenue from Contracts with Customers, which provides new guidance on recognition of revenue. The

16
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Corporation determines appropriate revenue recognition for its contracts with customers by analyzing
the type, terms and conditions of each contract or agreement with a customer.

As part of the analysis, the management must make judgments about whether an agreement or
contract is legally enforceable, and whether the agreement includes separate performance obligations.
In addition, estimates are required in order to allocate the total price of the transaction to each
performance obligation based on the stand-alone selling price of the promised goods or services
underlying each performance obligation. (The Corporation applies the constraint on variable
consideration as defined in IFRS 15, if applicable).

Although the abovementioned estimates have been made based on the best information available as of
the date of issuance of these consolidated financial statements, itis possible that new developments could
lead the Corporation to modify these estimates in the future. Such modifications, if applicable, would be
adjusted prospectively, as required by IAS 8 “Accounting Policies, Changes in Accounting Estimates and
Errors.”

17
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

2.

Significant accounting policies

a)

b)

d)

Period covered – The accompanying consolidated financial statements of Corporación Nacional del
Cobre de Chile include the following statements:

Consolidated statements of financial position as of December 31, 2018 and 2017.

Consolidated statements of comprehensive income for years ended December 31, 2018 and 2017.
Consolidated statements of changes in equity for years ended December 31, 2018 and 2017.
Consolidated statements of cash flows for years ended December 31, 2018 and 2017.

Basis of preparation – The consolidated financial statements of the Corporation as of December 31,
2018 and 2017, and for the years ended December 31, 2018 and 2017 have been prepared in
accordance with the instructions from the Commission for the Financial Market which fully comply with
IFRS as issued by the lASB.

The consolidated statement of financial position as of December 31, 2017, and the consolidated
statement of income for the year ended December 31, 2017, the consolidated statement of changes in
equity and consolidated statement of cash flows for the year ended December 31, 2017, which are
included for comparative purposes, have been prepared in accordance with IFRS issued by the lASB,
on a basis consistent with the criteria used for the same period ended December 31, 2018, except for
the adoption of the new IFRS standards and interpretations adopted by the Corporation as of and for
the years ended December 31, 2018, which are disclosed in note 11.3.

These consolidated financial statements have been prepared based on the accounting records kept by
the Corporation.

Functional Currency – The functional currency of Codelco is the U.S. dollar, which is the currency of
the primary economic environment in which the Corporation operates and the currency in which it
receives ¡ts revenues.

The functional currency of subsidiaries, associates and joint ventures, is the currency of the primary
economic environment in which those entities operate and the currency in which they receive their
revenues. However, for those subsidiaries and associates that are an extension of the operations of
Codelco (entities that are not self-sufficient and whose main transactions are with Codelco); the
functional currency is also the U.S. dollar.

The presentation currency of Codelco’s consolidated financial statements is the U.S. dollar.

Basis of consolidation – The consolidated financial statements incorporate the financial statements
of the Corporation and its subsidiaries.

Subsidiaries are fully consolidated from the date of acquisition, being the date on which the Corporation

obtains control, and continue to be consolidated until the date such control ceases. Specifically, income
and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated

18
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

statement from the date the Corporation gains control until the date when the Corporation ceases to
control the subsidiary.

The financial statements of the subsidiaries are prepared for the same reporting period as the
Corporation, using consistent accounting policies.

All assets, liabilities, equity, income, expenses and cash flows related to transactions between
consolidated companies are fully eliminated on consolidation. Non-controlling interests in equity and in
the comprehensive income of the consolidated subsidiaries are presented, respectively, under the line
items “Total Equity: Non-controlling interests” in the consolidated statement of financial position and
“Net income attributable to non-controlling interests” and “Comprehensive income attributable to non-
controlling interests” in the consolidated statement of comprehensive income.

19
CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The companies included in the consolidation are as follows:

12/31/2018 12/31/2017
Taxpayer ID Number Company Country Currency % Ownership % Owmership
Direct Indirect Total Total

Foreign Chile Copper Limited England GBP 100.00] -] 100.00] 100.00]
Foreign [Codelco do Brasil Mineracao Brazil BRL -] 100.00] 100.00] 100.00]
Foreign [Codelco Group Inc. Unid States | ¡os 100.00] , 100.00 100.00

of America
Foreign [Codelco Intemational Limited Bermuda US$ 100.00] -] 100.00] 100.00]
Foreign ¡Codelco Kupferhandel GmbH Germany EURO 100.00] -] 100.00] 100.00]
Foreign [Codelco Metals Inc. United States [yg y 100.00 100.00 100.00

of America
Foreign [Codelco Services Limited England GBP -] 100.00] 100.00] 100.00]
Foreign ¡Codelco Shanghai Company Limited China RMB 100.00] -] 100.00] 100.00]
Foreign [Codelco Technologies Ltd. Bermuda US$ -] 100.00] 100.00] 100.00]
Foreign [Codelco USA Inc United States [yg y 100.00 100.00 100.00

of America
Foreign [Codelco Canada Canada US$ -] 100.00] 100.00] 100.00]
Foreign Ecometales Limited Channel US$ y 100.00] 100.00] 100.00]

Islands

Foreign Exploraciones Mineras Andinas Ecuador EMSAEC S.A. Ecuador US$ -] 100.00] 100.00] 100.00]
Foreign ¡Cobrex Prospeccao Mineral Brazil BRL -] 51.00] 51.00] 51.00]
78.860.780-6 ¡Compañía Contractual Minera los Andes Chile US$ 99.97| 0.03] 100.00] 100.00]
179.566.720-2 Isapre Chuquicamata Ltda. Chile CLP 98.30] 1.70] 100.00] 100.00]
81.767.200-0 ¡Asociación Garantizadora de Pensiones Chile CLP 96.69] >] 96.69] 96.69]
88.497. 1004 [Clinica San Lorenzo Limitada Chile CLP 99.90] 0.10] 100.00] 100.00]
76.521.250-2 [San Lorenzo Institución de Salud Previsional Ltda. Chile CLP >] 100.00] 100.00] 100.00]
89.441. 300-K Isapre Río Blanco Ltda. Chile CLP 99.99] 0.01 100.00] 100.00]
196.817.780-K Ejecutora Hospital del Cobre Calama S.A. Chile US$ 99.99] 0.01 100.00] 100.00]
196.819.040-7 [Complejo Portuario Mejillones S.A. Chile US$ 99.99] 0.01 100.00] 100.00]
76.024.442-2 Ecosea Farming S.A. Chile US$ -] -] -] 98.98|
196.991.180-9 [Codelco Tec SpA Chile US$ 99.91 0.09] 100.00] 100.00]
199.569.520-0 Exploraciones Mineras Andinas S.A. Chile US$ 99.90] 0.10] 100.00] 100.00]
199.573.600-4 [Clinica Río Blanco S.A. Chile CLP 99.00] 1.00] 100.00] 100.00]
76.064.682-2 [Centro de Especialidades Médicas Río Blanco Ltda. Chile CLP 99.00] 1.00] 100.00] 100.00]
77.773.260-9 Inversiones Copperfield Ltda. Chile US$ 99.99] 0.01 100.00] 100.00]
76.043.396-9 Innovaciones en Cobre S.A. Chile US$ 0.05] 99.95] 100.00] 100.00]
76.148.338-2 ¡Sociedad de Procesamiento de Molibdeno Ltda. Chile US$ 99.95] 0.05] 100.00] 100.00]
176.173.357-5 Inversiones Gacrux SpA Chile US$ 100.00] -] 100.00] 100.00]
76.231.838-5 Inversiones Mineras Nueva Acrux SpA Chile US$ -] 67.80] 67.80] 67.80]
76.237.866-3 Inversiones Mineras Los Leones SpA Chile US$ 100.00] -] 100.00] 100.00]
76.173.783-K Inversiones Mineras Becrux SpA Chile US$ -] 67.80] 67.80] 67.80]
76.124.156-7 [Centro de Especialidades Médicas San Lorenzo Ltda. Chile US$ -] 100.00] 100.00] 100.00]
76.255.061-K [Central Eléctrica Luz Minera SpA Chile US$ 100.00] -] 100.00] 100.00]
70.905.700-6 Fusat Chile CLP -] -] -] 3
176.334.370-7 Instituto de Salud Previsional Fusat Ltda. Chile CLP >] >] >] -]
78.394.040-K [Centro de Servicios Médicos Porvenir Ltda… Chile CLP >] 99.00] 99.00] 99.00]
77.928.390-9 Inmobiliaria e Inversiones Rio Cipreces Ltda. Chile CLP -] 99.90] 99.90] 99.90]
77.270.020-2 Prestaciones de Servicios de la Salud Intersalud Ltda. Chile CLP >] 99.00] 99.00] 99.00]
76.754.301-8 [Salar de Maricunga SpA Chile CLP 100.00] -] 100.00] 100.00]

On December 21, 2017, according to decree No. 12285 / 2017, by public deed, it was agreed between
the shareholders to merge the Acrux SpA Mining Investment Company (“Absorbed Company”) with
the Investment Company Minera Becrux SpA (“Absorbing Company”), which took effect as of
December 22, 2017, where the Absorbing Company acquired all the assets and liabilities of the

20
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Absorbed Company, (which will be dissolved without having to effect its liquidation) in addition to being
responsible for the payment of all taxes owed or which may be owed by the Absorbed Company.

For the purposes of these consolidated financial statements, subsidiaries, associates, acquisitions
and disposals and joint ventures are defined as follows:

Subsidiaries – A subsidiary is an entity over which the Corporation has control. Control is
exercised if, and only if, the following conditions are met: the Corporation has i) power to direct
the relevant activities of the subsidiaries unilaterally; ii) exposure or rights to variable returns from
these entities; and iii) the ability to use ¡its power to influence the amount of these returns.

The Corporation reassesses whether or not it controls a subsidiary if facts and circumstances
indicate that there are changes to one or more of the elements of control listed above.

The consolidated financial statements include all assets, liabilities, revenues, expenses and cash
flows of Codelco and its subsidiaries, after eliminating all inter-company balances and
transactions.

The value of the participation of non-controlling shareholders in equity, net income and
comprehensive income of subsidiaries are presented, respectively, in the headings “Non-
controlling interests” of the consolidated statement of financial position; “Net income attributable
to non-controlling interests”; and “Comprehensive income attributable to non-controlling interests.”

Associates – An associate is an entity over which Codelco has significant influence. Significant
influence ¡is the power to participate in the financial and operating policy decisions of the associate
but is not control or joint control over those policies.

Codelco’s interest ownership in associates is recognized in the consolidated financial statements
under the equity method. Under this method, the initial investment is recognized at cost and
adjusted thereafter to recognize changes in Codelco’s share of the comprehensive income of the
associate, less any impairment losses or other changes to the net assets of the associate.

Appropriate adjustments to the Codelco’s share of the associate’s profit or loss after acquisition
are made in order to account for depreciation of the depreciable assets and related deferred tax
balances based on their fair values at the acquisition date.

Acquisitions and Disposals – The results of businesses acquired are incorporated in the
consolidated financial statements from the date when control is obtained; the results of businesses
sold during the period are included into the consolidated financial statements up to the effective
date of disposal. Gains or losses on disposal is the difference between the sale proceeds (net of
expenses) and the carrying amount of the net assets attributable to the ownership interest that
has been sold (and, where applicable, the associated cumulative translation adjustment).

If control is lost over a subsidiary, the retained ownership interest in the investment will be
recognized at its fair value.

21
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

e)

At the acquisition date of an investment in a subsidiary, associate or joint venture, any excess of
the cost of the investment (consideration transferred) plus the amount of the non-controlling
interest in the acquiree plus the fair value of any previously held equity interest in the acquiree,
where applicable, over Codelco’s share of the net fair value of the identifiable assets and acquired
liabilities is recognized as goodwill. Any excess of Codelco’s share of the net fair value of the
identifiable assets and acquired liabilities over the consideration transferred, after reassessment,
is recognized immediately in profit or loss in the period in which the investment is acquired.

+ Joint Ventures – The entities that qualify as joint ventures are accounted for using the equity
method.

Foreign currency transactions and conversion to reporting currency – Transactions in currencies
other than the Corporation’s functional currency are recognized at the rates of exchange prevailing at
the dates of the transactions. At the end of each reporting period, foreign currency transactions
denominated in foreign currencies are converted at the rates prevailing at that date. Exchange
differences on such transactions are recognized in profit or loss in the period in which they arise and
are included in line item “Foreign exchange differences” in the consolidated statement of
comprehensive income.

At the end of each reporting period, assets and liabilities denominated in Unidades de Fomento (UF
or inflation index-linked units of account) are translated into U.S. dollars at the closing exchange rates
at that date (12/31/2018: US$39.68; 12/31/2017: US$43.59). The expenses and revenues in Chilean
pesos have been expressed in dollars at the observed exchange rate, corresponding to the date of the
accounting recording of each operation.

The financial statements of subsidiaries, associates and jointly controlled entities, whose functional
currency is other than the presentation currency of Codelco, are translated as follows for purposes of
consolidation:

+ Assets and liabilities are translated using the prevailing exchange rate on the closing date of the
financial statements.

+ Income and expenses for each statement of comprehensive income are translated at average
exchange rates for the period.

+ Non-monetary assets and liabilities as well as equity are translated at historic exchange rates.

+ All resulting exchange differences are recognized in other comprehensive income and
accumulated in equity under the heading “Reserve on exchange differences on translation”.

22
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

9)

The exchange rates used in each reporting period were as follows:

Relation Closing exchange ratios

12/31/2018 | 12/31/2017

USD /CLP 0.00144 | 0.00163
USD /GBP 1.27000 | 1.35355
USD /BRL 0.25848 | 0.30198
USD /EURO 1.14390 | 1.20236

Offsetting balances and transactions: In general, assets and liabilities, income and expenses, are
not offset in the financial statements, unless required or permitted by an IFRS or when offsetting reflects
the substance of the transaction as well as when it is the intention of the Corporation to settle a
transaction net.

Income or expenses arising from transactions which, for contractual or legal reasons, permit the
possibility of offsetting and which the Corporation intends to liquidate for their net value or realize the
assets and settle the liabilities simultaneously, are stated net in the statement of comprehensive
income.

Property, plant and equipment and depreciation – ltems of property, plant and equipment are
initially recognized at cost. Subsequent to initial recognition, they are measured at cost, less any
accumulated depreciation and any accumulated impairment losses.

Extension, modernization or improvement costs that represent an increase in productivity, capacity or
efficiency, or an increase in the useful life of the assets are capitalized as increasing the cost of the
corresponding assets.

Furthermore, assets acquired under finance lease contracts are included in property, plant and
equipment.

Starting fiscal year 2014, the assets included in property, plant and equipment are depreciated, as a
general rule, using the units of production method, when the activity performed by the asset is directly
attributable to the mine production process. All other assets included in property, plant and equipment
are depreciated using the straight-line method.

23
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The assets included in property, plant and equipment and certain intangibles (software) are depreciated
over their economic useful lives, as described below:

Category Useful Life
Land Not depreciated
Land on mine site Units of production
Buildings Straight-line over 20-50 years
Buildings in underground mine levels Units of production level
Vehicles Straight-line over 3-7 years
Plant and equipment Units of production
Smelters Straight-line
Refineries Units of production
Mining rights Units of production
Support equipment Units of production
Intangibles – Software Straight-line over 8 years
Open pit and underground mine
development Units of production

Leased assets are depreciated over the lease term or their estimated useful life, whichever is shorter.

Estimated useful lives, residual values and depreciation method are reviewed at the end of each
reporting period, and any change in estimates is recognized prospectively.

Additionally, depreciation method and estimated useful lives of assets, especially plants, facilities and
infrastructure may be revised at the end of each year or during the year according to changes in the
structure of reserves of the Corporation and productive long-term plans updated as of that date.

This review may be made at any time if the conditions of ore reserves change significantly as a result
of new known information, confirmed and officially released by the Corporation.

Gains or losses on the sale of disposal of an asset are calculated as the difference between the net
disposal proceeds received and the carrying amount of the asset, and are included in profit or loss
when the asset is derecognized.

Construction in progress includes the amounts invested in the construction of property, plant and
equipment and in mining development projects. Construction in progress is transferred to assets in
operation once the testing period has ended and when they are ready for use; at that point, depreciation
begins to be recognized.

Borrowing costs that are directly attributable to the acquisition or construction of assets that require a
substantial period of time before they are ready for use or sale are capitalized as part of the cost of the
corresponding items of property, plant and equipment.

The ore deposits owned by the Corporation are recorded in the accounting records at US$1.

24
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

h)

Notwithstanding the above, those reserves and resources acquired as part of acquisition of entities
accounted for as business combinations, are recognized at their fair value.

Intangible assets – The Corporation initially recognizes these assets at acquisition cost. Subsequent
to initial recognition, intangible assets are amortized in a systematic way over their economic useful
life, except for those assets with indefinite useful life, which are not amortized. Indefinitely-lived
intangible assets are tested for impairment at least annually, and whenever there ¡is an indication that
these assets may be impaired. Definitely-lived intangible assets are tested for impairment when an
indicator of impairment has been identified. At the end of each reporting period, these assets are
measured at their cost less any accumulated amortization (when applicable) and any accumulated
impairment losses.

The main intangible assets are described as follows:

Research and Technological Development and Innovation Expenditures: The expenditures for
the development of Technology and Innovation Projects are recognized as intangible assets at their
cost and are considered to have indefinite useful lives.

Development expenses for technology and innovation projects are recognized as intangible assets at
cost, if and only if, all of the following have been demonstrated:
e The technical feasibility of completing the intangible asset so that it will available for use or
sale;
The intention to complete the intangible asset is to use or sell it;
The ability to use or sell the intangible asset;
That the intangible asset will generate probable future economic benefits;
The availability of adequate technical, financial and other resources to complete the
development and to use or sell the intangible asset; and
e The ability to measure reliably the expenditure attributable to the intangible asset during its
development.

Research expenses for technology and innovation projects are recognized in profit or loss when
incurred.

Impairment of property, plant and equipment and intangible assets – The carrying amounts of
property, plant and equipment and intangible assets with finite useful lives are reviewed to determine
whether there is an indication that those assets have suffered an impairment loss. If any such indicator
exists, the Corporation estimates the asset’s recoverable amount to determine the extent of the
impairment loss which is then recorded.

For assets with indefinite useful lives, their recoverable amounts are annually estimated at the end of
each reporting period.

When an asset does not generate cash flows that are independent from other assets, Codelco
determines the recoverable amount of the CGU to which the asset belongs.

25
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

j

The Corporation has defined each of its divisions as a cash generating unit.

Recoverable amount of an asset is the higher of fair value less costs of disposal and value in use. In
assessing value in use, the estimated future cash flows are discounted to their present value using a
pre-tax discount rate that reflects current market assessments of the time value of money and the risks
specific to the asset. On the other hand, the fair value less cost of disposal is usually determined for
operational assets considering the Life of Mine (“LOM”), based on a model of discounted cash flows,
while the assets not included in LOM as resources and potential resources to exploit are measured by
using a market model of multiples for comparable transactions.

If the recoverable amount of an asset or CGU is estimated to be less than its carrying amount, an
impairment loss is recognized immediately in profit or loss, reducing the carrying amount to its
recoverable amount. When an impairment loss subsequently reverses, the carrying amount of the
asset or CGU is increased to the revised estimate of its recoverable amount, but so that the increased
carrying amount does not exceed the carrying amount that would have been determined had no
impairment loss been recognized for the asset or CGU in prior years.

The estimates of future cash flow for a CGU are based on future production forecasts, future prices of
basic products and future production costs. Under lAS 36 “Impairment of Assets”, there are certain
restrictions for future cash flows estimates related to future restructurings and future cost efficiencies.
When calculating value in use, it is also necessary to base the calculations on the spot exchange rate
at the date of calculation.

Expenditures for exploration and evaluation of mineral resources, mine development and
mining operations – The Corporation has defined an accounting policy for each of these expenditures.

Development expenses for deposits under exploitation whose purpose is to maintain production levels
are recognized in profit or loss when incurred.

Exploration and evaluation costs such as: drillings of deposits, including expenses necessary to locate
new mineralized areas and engineering studies to determine their potential for commercial exploitation
are recognized in profit or loss, normally at the pre-feasibility stage.

Pre-operating and mine development expenses (normally after feasibility engineering is reached)
incurred during the execution of a project and until its start-up are capitalized and amortized in relation
to the future production of the mine. These costs include stripping of waste material, constructing the
mine’s infrastructure and other works carried out prior to the production phase.

Finally, costs for defining of new areas or deposit areas in exploitation and of mining operations (PP8.E)

are recognized in property, plant and equipment and are amortized through — profit or loss over the
period during which the benefits are obtained.

26
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

k)

Stripping costs – Costs incurred in removing mine waste materials (overburden) in open pits that are
in production, that provide access to mineral deposits, are recognized in property, plant and equipment,
when the following criteria set out in IFRIC 20 Stripping Costs in the Production Phase of a Surface
Mine are met:

– — Itis probable that the future economic benefits associated with the stripping activity will flow to the
entity.

– — Itis possible to identify the components of an ore body for which access has been improved as a
result of the stripping activity.

– The costs relating to that stripping activity can be measured reliably.

The amounts recognized in property, plant and equipment are depreciated according to the units of
production extracted from the ore body related to the specific stripping activity which generated this
amount.

Income taxes and deferred taxes – Codelco and ¡ts Chilean subsidiaries recognize annually income
taxes based on the net taxable income determined as per the standards established in the Income Tax
Law and Article 2 of D.L. 2398, as well as, the specific tax on mining referred to in Law 20026 of 2005.
Its foreign subsidiaries recognize income taxes according to the tax regulations in each country.

In addition, Codelco’s taxable income in each period is subject to the tax regime established in Article
26 of D.L. No. 1350, which states that tax payments will be made on March, June, September and
December of each year, based on a provisional tax return.

Deferred taxes on temporary differences and other events that generate differences between the
accounting and tax bases of assets and liabilities are recognized in accordance with lAS 12 “Income
taxes.”

Deferred taxes are also recognized for undistributed profits of subsidiaries, associates and joint
ventures, originated by withholding tax rates on remittances of dividends paid out by such companies
to the Corporation.

Inventories – Inventories are measured at cost, when such does not exceed net realizable value. Net
realizable value represents the estimated selling price for inventories less all estimated costs of
completion and costs necessary to make the sale (i,e,, marketing, sales and distribution expenses).
Costs of inventories are determined according to the following methods:

– Finished products and products in process: These inventories are measured at their average
production cost determined using the absorption costing method, including labor, depreciation of fixed
assets, amortization of intangibles and indirect costs of each period. Inventories of products in process
are classified in current and non-current, according to the normal cycle of operation.

27
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

– Materials in warehouse: These inventories are measured at their acquisition cost. The Corporation
estimates an allowance for obsolescence considering the turnover rate of slow-moving materials in the
warehouse.

– Materials in transit: These inventories are measured at cost incurred until the end of reporting period.
Any difference as a result of an estimate of net realizable value of the inventories lower than its carrying
amount is recognized in profit or loss.

Dividends – In accordance with Article 6 of D.L. 1350, the Corporation has a mandatory obligation to
distribute its net income as presented in the financial statements. The payment obligation is recognized
on an accrual basis.

Employee benefits – Codelco recognizes a provision for employee benefits when there is a present
obligation (legal or constructive) as a result of services rendered by its employees.

The employment contracts stipulate, subject to compliance with certain conditions, the payment of an
employee termination indemnity when an employment contract ends. In general, this corresponds to
one monthly salary per year of service and considers the components of the final remuneration which
are contractually defined as the basis for the indemnity. This employee benefit has been classified as
a defined benefit plan.

Codelco has also agreed to post-employment medical care benefits for certain employees, which are
paid based on a fixed percentage applied to the last monthly taxable salary of the retirees covered by
this agreement. This employee benefit has been classified as a defined benefit plan.

These plans continue to be unfunded as of December 31, 2018.

The employee termination indemnity and the post-employment medical plan obligations are determined
using the projected unit credit method, with actuarial valuations being carried out at the end of each
reporting period. The defined benefit plan obligations recognized in the statement of financial position
represent the present value of the accrued obligations. Actuarial gains and losses are recognized
immediately in other comprehensive income and will not be reclassified to profit or loss.

The Corporation’s management uses assumptions to determine the best estimate of these benefits.
The assumptions include an annual discount rate, expected increases in salaries and turnover rate,
among other factors.

In accordance with ¡ts operating optimization programs to reduce costs and increase labor productivity
by incorporating new current technologies and/or better management practices, the Corporation has
established employee retirement programs by amending certain employment contracts or collective
union agreements to include benefits encouraging employees to early retire. Accordingly, these
arrangements are accounted for as termination benefits and required accruals are established based
on the accrued obligation at current value, In case of employee retirement programs which involve
multi-year periods, the accrued obligations are updated using a discount rate determined based on

28
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

p)

a)

financial instruments denominated in the same currency and similar maturities that will be used to pay
the obligations.

Provisions for decommissioning and site restoration costs – The Corporation is obliged to incur
decommissioning and site restoration costs Such site restoration or decommissioning ¡is required due
to a legal or constructive obligation. Costs are estimated on the basis of a formal closure plan and cost
estimates are annually reviewed.

A provision is recognized for decommissioning and site restoration costs. The amount of the provision
is the present value of the expenditures expected to be required to settle the obligation. The provision
is initially recognized with a corresponding increase in the carrying amount of the related assets.

The provision for decommissioning and site restoration costs is accreted over time to reflect the
unwinding of the discount with the accretion expense included in finance costs in the statement of
income. The carrying amount of the related asset is depreciated over its useful life.

Changes in the measurement of the decommissioning and site restoration provision that result from
changes in the estimated timing or amount of the outflow of resources embodying economic benefits
required to settle the obligation, or a change in the discount rate, are added to, or deducted from, the
cost of the related assets in the period when changes occurred. The amount deducted from the cost of
the related assets cannot exceed its carrying amount. If a decrease in the liability exceeds the carrying
amount of the asset, the excess is recognized immediately in profit or loss.

If the adjustment results in an addition to the cost of an asset, the Corporation considers whether this
is an indication that the new carrying amount of the asset may not be fully recoverable. If such an
indicator exists, the Corporation tests the asset for impairment by estimating its recoverable amount,
and recognizes an impairment loss, if any.

The effects of the updating of the liability, due to the effect of the discount rate and / or passage of time,
is recorded as a financial expense.

Leases – Leases are classified as finance leases whenever the terms of the lease transfer substantially
all the risks and rewards of ownership to the Corporation. All other leases are classified as operating
leases. Operating lease costs are recognized as an expense on a straight-line basis over the lease
term.

Assets held under finance leases are initially recognized as assets at the inception of the lease at either
their fair value or the present value of the minimum lease payments (discounted at the interest rate
implicit in the lease), whichever is lower. Lease payments are apportioned between finance costs and
reduction of the lease obligation so as to achieve a constant rate of return on the remaining balance of
the liability. Lease obligations are included in other current or non-current liabilities, as appropriate.

In accordance with IFRIC 4 “Determining whether an Arrangement contains a Lease”, an arrangement
is, or contains a lease if fulfilment of the arrangement is dependent on the use of a specific asset or

29
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

assets and if the arrangement conveys the right to use the asset, even if that right is not explicitly
specified.

All “take-or-pay” contracts and any other service and supply contracts that meet the conditions in IFRIC
4, are reviewed to determine whether they contain a lease.

Revenue from Contracts with Customers – Revenue is recognized in an amount that reflects the
consideration to which the entity expects to be entitled in exchange for transferring goods or services.

– Sale of mineral goods and / or by-products

Contracts with customers for the sale of mineral goods and / or by-products include the performance
obligation for the delivery of the physical goods and the associated transportation service, at the place
agreed with the customers. The Corporation recognizes revenue from the sale of goods at the time
control of the asset is transferred to the customer, according to the shipment or dispatch of the
products, in accordance with the agreed conditions, such revenue being subject to variations related
to the content and / or sale price at the date ofits liquidation. Notwithstanding the foregoing, there are
some contracts where control is transferred substantially to the client based on the receipt of the
product instead of the buyer’s corresponding destination, making the revenue recognition at the time
of said transfer. When services of transport of goods are provided, the Corporation recognizes revenue
when the service obligation is satisfied.

Sales that have discounts associated with volume subject to compliance with goals are recognized net,
estimating the probability that the volume target will be reached.

Sales contracts include a provisional price at the shipment date. The final price is generally based on
the London Metals Exchange (“LME”) price, Revenue from sales of copper is measured using
estimates of the future spread of metal prices on the LME and/or the spot price at the date of shipment,
with subsequent adjustments made upon final pricing recognized as revenue. The terms of sales
contracts with customers contain provisional pricing arrangements whereby the selling price for metal
concentrate is based on prevailing spot prices on a specified future date after shipment to the customer
(the “quotation period”). Consequently, the final price is set at the dates indicated in the contracts.
Adjustments to provisional sale prices occur based on movements in quoted market prices on the LME
up to the date of final pricing. The period between provisional invoicing and final pricing is typically
between one and nine months. Changes in fair value over the quotation period and until final pricing
are estimated by reference to forward market prices for applicable metals.

In terms of hedge accounting established by IFRS 9, the Corporation has opted to continue applying
the hedge accounting requirements of the IAS 39 instead of the requirements of the new standard.
Therefore, the generated no effects both at the level of account balances or at the level of disclosures.

Sales in the Chilean market are recognized in conformity with the regulations that govern domestic
sales as indicated in Articles 7, 8 and 9 of Law No. 16624, modified by Article 15 of Decree Law No.

30
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

1349 of 1976, on the determination of sales prices for the internal market which does not differ from
IFRS 15.

As indicated in the note related to hedging policies in the market of metal derivatives, the Corporation
enters into operations in the market of metal derivatives. Gains and losses from those which are fair
value hedges contracts are recognized as revenues.

– — Rendering of services

Additionally, the Corporation recognizes revenue for rendering services, which are mainly related to
the processing of minerals bought from third parties. Revenue from rendering of services is recognized
when the amounts can be measured reliably and when the services have been provided.

Derivative contracts – Codelco uses derivative financial instruments to reduce the risk of fluctuations
in sales prices of its products and of exchange rates.

Derivatives are initially recognized at fair value at the date the derivative contracts are entered into and
are subsequently measured to their fair value at the end of each reporting period.

The effective portion of changes in the fair value of derivatives that are designated and qualify as cash
flow hedges is recognized in other comprehensive income and accumulated in equity under the item
“Cash flow hedge reserve.” The gain or loss relating to the ineffective portion is immediately recognized
in profit or loss, and included in the “Finance cost” or “Finance income” line items. Amounts previously
recognized in other comprehensive income and accumulated in equity are reclassified to profit or loss
in the periods when the hedged item affects profit or loss, in the same line as the effect for the
fluctuation in the recognized hedged item.

A hedge relationship is considered highly effective when changes in fair value or in cash flows of the
underlying item directly attributable to the hedged risk are offset by changes in fair value or cash flows
of the hedging instrument, with an effectiveness ranging from 80% to 125%. Changes in fair value
accumulated in other comprehensive income are subsequently reclassified from equity to profit or loss
in the same period or periods during which the hedged item affects profit or loss. Upon discontinuation
of hedge accounting and depending on the circumstances, the cumulative gain or loss on the hedging
instrument remains in equity until the hedged transaction occurs or, if the hedged transaction is not
expected to occur, the amount accumulated in other comprehensive income is reclassified to profit or
loss.

The total fair value of hedging derivatives is classified as “non-current financial asset or liability”, if the
remaining maturity of the hedged item is greater than 12 months, and as “current financial asset or
liability”, if the remaining maturity of the hedged item ¡is less than 12 months.

The derivative contracts held by the Corporation have been entered into to apply the risk hedging
policies and are accounted for as indicated below:

31
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

– — Hedging policies for exchange rate risk: The Corporation enters into exchange rate derivatives
to hedge exchange rate variations between the U.S. dollar and the currencies of transactions the
Corporation undertakes. In accordance with the policies established by the Board of Directors, these
hedge transactions are only entered into when there are recognized assets or liabilities, forecasts
of highly probable transactions or firm commitments. The Corporation does not enter into derivative
transactions for non-hedging purposes.

– — Hedging policies for metal market prices risk: In accordance with the policies established by the
Board of Directors, the Corporation entered into derivative contracts to reduce the inherent risks in
the fluctuations of metal prices.

The hedging policies seek to cover expected cash flows from the sale of products by fixing the sale
prices for a portion of future production. When the sales agreements are fulfilled and the derivative
contracts are settled, the results from sales and derivative transactions are offset in profit or loss in
revenue.

Hedging transactions carried out by the Corporation in the metal derivatives market are not
undertaken for speculative purposes.

– Embedded derivatives: The Corporation has established a procedure that allows for evaluation of
the existence of embedded derivatives in financial and non-financial contracts. Where there is an
embedded derivative, and the host contract is not a financial instrument and the characteristics and
risks of the embedded derivative are not closely related to the host contract, the derivative ¡is
required to be recognized separately.

t) Financial information by segment – The Corporation has defined ¡ts Divisions as its operating
segments in accordance with the requirements of IFRS 8, Operating Segments. The mining deposits
in operation, where the Corporation conducts its extractive and processing activities are managed by
the following Divisions: Chuquicamata, Radomiro Tomic, Ministro Hales, Gabriela Mistral, Salvador,
Andina and El Teniente, In addition, the smelting and refining activities are managed at the Ventanas
Division. All these Divisions have a separate operational management, which reports to the Chief
Executive Officer, through the North and South Central Vice-President of Operations, respectively.
Income and expenses of the Head Office are allocated to the defined operating segments.

u) Presentation of Financial Statements – The Corporation presents (i) its statements of financial
position classified as “current and non-current”, (ii) profit or loss and other comprehensive income in
one statement and the classification of expenses within profit or loss by function, and (iii) its statement
of cash flows using the direct method.

v) Current and non-current financial assets – The Corporation determines the classification of its
financial assets at the time of initial recognition. The classification depends on the business model in
which the investments are managed and the contractual characteristics of their cash flows.

32
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The Corporation’s financial assets are classified into the following categories:

Fair value through profit or loss:

Initial recognition: This category includes those financial assets not qualifying under the categories
of Fair Value through Other Comprehensive Income or Amortized Cost. These instruments are
initially recognized at fair value.

Subsequent recognition: Their subsequent recognition is at fair value, recording in the consolidated
statement of comprehensive income, in the line “Other gains (losses)” any changes in fair value.

Amortized cost:

Initial recognition: This category includes those instruments with respect to which the objective of
the business model of the Corporation is to hold the financial instrument to collect contractual cash
flows and such cash flows consist of solely payments of principal and interest. This category
includes Trade and other current receivables, and the loans included in other non-current financial
assets.

Subsequent recognition: These instruments are subsequently measured at amortized cost using
the effective interest method. The amortized cost of a financial asset is the amount at which the
financial asset is measured at initial recognition minus the principal repayments, plus the cumulative
amortization using the effective interest method of any difference between that initial amount and
the maturity amount, adjusted for any impairment allowance.

Codelco did not irrevocably choose to designate any of its investment assets at fair value with effect
on other comprehensive income.

Interest income ¡is recognized in profit or loss and is calculated by applying the effective interest
rate to the gross carrying amount of a financial asset. For financial assets measured at amortized
cost that are not part of a designated hedging relationship, exchange differences are recognized in
profit or loss in the “Foreign exchange difference” line item.

At fair value through other comprehensive income:

Initial measurement: Financial assets that meet the criteria “Solely payments of principal and
interest” (SPPI) are classified in this category and must be maintained within a business model both
to collect the cash flows and to sell the financial assets. These instruments are initially recognized
at fair value.

Subsequent recognition: Their subsequent valuation is at fair value. Interest income calculated

using the effective interest rate method, foreign exchange gains and losses and impairment are
recognized in income. Other net gains and losses are recognized in other comprehensive income.

33
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

On derecognition, the gains and losses accumulated in other comprehensive income are
reclassified to income.

w) Financial liabilities – Financial liabilities are initially recognized at fair value net of transaction costs.

y)

Subsequent to their initial recognition, the valuation of the financial liabilities will depend on their
classification, within which the following categories are distinguished:

Financial liabilities at fair value through profit or loss: This category includes financial liabilities
defined as held for trading.

The Corporation includes is this category certain hedge contracts and the equity and debt instruments
sold in the short-term, which are classified as held for trading.

Changes in fair value associated with own credit risk are recorded in other comprehensive income.

Financial liabilities at amortized cost: This category includes all financial liabilities other than those
measured at fair value through profit or loss.

The Corporation includes in this category bonds, obligations and other current payables.

These financial liabilities are measured using the effective interest rate method, recognizing interest
expense based on the effective rate.

The effective interest rate method is a method of calculating the amortized cost of a financial liability
and of allocating interest expense over the relevant period. The effective interest rate ¡is the rate that
exactly discounts estimated future cash payments through the expected life of the financial liability, or
where appropriate, a shorter period, to the net carrying amount on initial recognition.

Trade and other current payables are financial liabilities that do not explicitly accrue interest and are
recognized at their nominal value, which approximates their fair value.

Financial liabilities are derecognized when the liabilities are paid or expire.
Impairment of financial assets – The Corporation measures the loss allowance at an amount equal
to lifetime expected credit losses for ¡ts trade receivables. For this, it uses the simplified approach as a

requirement under IFRS 9.

The provision matrix is based on an entity’s historical credit loss experience over the expected life of
the trade receivables and is adjusted for forward-looking estimates.

Cash and cash equivalents and statement of cash flows prepared using the direct method – The

statement of cash flows reflects changes in cash and cash equivalents that took place during the period,
determined under the direct method.

34
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

aa)

ab)

ac)

For the purposes of preparing the statement of cash flows, the Corporation has defined the following:

– Cash flows: inflows and outflows of cash or cash equivalents, which are defined as highly liquid
investments maturing in less than three months with a low risk of changes in value.

– — Operating activities are the principal revenue-producing activities of the Corporation and other
activities that are not investing or financing activities.

– Investing activities are the acquisition and disposal of long-term assets and other investments
not included in cash equivalents.

– — Financing activities are activities that result in changes in the size and composition of net equity
and borrowings of the Corporation.

Bank overdrafts are classified as external resources in current liabilities.

Law No. 13196 – Law No. 13196 requires the payment of a 10% special export tax on receivables of
the sales proceeds that Codelco receives and transfers to Chile from the export of copper and related
by-products produced by Codelco. The Chilean Central Bank deducts 10% of the amounts that Codelco
transferred to ¡ts Chilean bank account. The amount recognized for this concept is presented in the
statement of income within line item other expenses.

On January 27, 2017, Law No. 20989, article 3, establishes changes in the application of Law No.
13196 as of January 1, 2018, through which the Corporation will deposit annually, no later than
December 15 of each year, the funds established in article 1 in that law.

Cost of sales – Cost of sales is determined according to the absorption costing method, including the
direct and indirect costs, depreciation, amortization and any other expenses directly attributable to the
production process.

Environment – The Corporation adheres to the principles of sustainable development, which foster the
economic development while safekeeping the environment and the health and safety of its
collaborators. The Corporation recognizes that these principles are central for the well-being of its
collaborators, care for the environment and success in its operations.

Classification of current and non-current balances – In the consolidated statement of financial
position, the balances are classified according to their maturities, that is, as current for those with a
maturity equal to or less than twelve months and as non-current for those with a greater maturity.
Where there are obligations whose maturity is less than twelve months, but whose long-term
refinancing is insured upon a decision by the Corporation whose intention is to refinance, through credit
agreements available unconditionally with long-term maturity, these could be classified as non-current
liabilities.

35
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

ad) Non-current assets or groups of assets for disposition classified as held for sale: The
Corporation classifies as non-current assets or groups of assets for disposal, classified as held for sale,
properties, plants and equipment, investments in associates and groups subject to expropriation (group
of assets that are going to be disposed of together with their directly related liabilities), for which, at the
closing date of the financial statements, their sale has been committed to or steps have been initiated
and it is estimated that it will be carried out within the twelve months following said date. These assets
or groups subject to disposal are valued at book value or the estimated sale value minus the costs
necessary for sale, whichever is less, and are no longer amortized from the moment they are classified
as non-current assets held for sale. Non-current assets or groups of assets for disposal classified as
held for sale and the components of the groups subject to disposal classified as held for sale are
presented in the consolidated statement of financial position on a line for each ofthe following concepts:
“Non-current assets or groups of assets for disposition classified as held for sale” and “Non-current
liabilities or groups of liabilities for disposition classified as held for sale.”

New standards and interpretations adopted by the Corporation

The accounting policies adopted in the preparation of the consolidated financial statements are consistent
with those applied in the preparation of the Corporation’s annual consolidated financial statements for the
year ended December 31, 2017, except for the adoption of new standards, interpretations and amendments,
effective from January 1, 2018, which are:

a) IFRS 9, Financial Instruments:

Due to the transition alternatives indicated in IFRS 9, no balances have been adjusted for comparative
periods corresponding to the year 2017.

The initial application date of IFRS 9 is January 1, 2018, and the difference between the recorded amounts
in comparative periods and those recorded at the date of initial application were recorded in Accumulated
Deficit as a gain of ThUS $ 2,282 (see detail below).

Classification of financial assets and liabilities

The adoption of IFRS 9 involved, first, reassessing the classification of financial assets and liabilities, based
on the new definition included in this standard. In this sense, and in accordance with the business model in
which Codelco manages its investments and the contractual characteristics of the cash flows of such, the
classification of financial assets and liabilities under IFRS 9 and adopted by the Corporation (disclosed in
notes 13 and 14 of section lIl of these Consolidated Financial Statements), resulted solely in a
reclassification of the trade and accounts receivable subject to provisional pricing. Such receivables
classification has been changed from amortized cost to fair value through profit and loss. Previously, the
provisional pricing element was separated as an embedded derivative. Under IFRS 9, the receivable ¡is
classified at fair value through profit and loss considering the receivable as a hybrid contract.This
reclassification under IFRS 9 did not result in any adjustments to accumulated deficit at January 1, 2018.

36
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Impairment

Regarding the guidance in IFRS 9 related to the application of the expected credit loss model under the
approach described in note 2 of the Significant Accounting Policies, letter x), the application resulted in the
recognition of a loss allowance over the accounts receivable balances at the date of initial application as
indicated below:

Effects of IFRS 9 on Trade and other current receivables as of January 1, 2018 ThUS$
Net trade and other current receivables balance as of January 1, 2018, under accounting 2,815,352
criteria prior to IFRS 9

Transition adjustment to IFRS 9 – allowance for doubtful accounts (2,239)
Net trade and other current receivables balance as of January 1, 2018, adjusted by IFRS 9 2,813,113

Financial Liabilities

Another topic of the adoption of IFRS 9 that had an effect on Codelco ¡is related to the financial liabilities
refinanced during July 2017, which resulted in the continuation of the deferral and subsequent amortization
of certain financial costs relating to the original financing due to the non-substantial modification of
contractual flows under lAS 39. Under IFRS 9, a modified gain/loss is required to be calculated with respect
to such modification which for purposes of the first application of the new standard, resulted in the
recognition of an adjustment to the balances of bond obligations at the date of transition as indicated below:

Effects of IFRS 9 on Other non-current financial liabilities as of January 1, 2018 ThUS$
Other non-current financial liabilities balance as of January 1, 2018, under accounting 14,648,004
criteria prior to IFRS 9

Transition adjustment to IFRS 9 (9,846)
Other non-current financial liabilities balance as of January 1, 2018, adjusted for IFRS 9 14,638,158

Hedge accounting

In terms of hedge accounting established by IFRS 9, the Corporation has opted to continue applying the
hedge accounting requirements of the IAS 39 instead of the requirements of the new standard. Therefore,
the generated no effects both at the level of account balances or at the level of disclosures.

37

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Finally, the net effect on initial application of IFRS 9 on Codelco’s accumulated deficit, considering the
amounts previously indicated, was as follows:

Effects of IFRS 9 on accumulated deficit as of January 1, 2018 ThUS$
Accumulated deficit balance as of January 1, 2018, under accounting criteria (36,672)
prior to IFRS 9

Transition adjustments to IFRS 9, net of deferred taxes 2,282
Accumulated deficit balance as of January 1, 2018, adjusted for IFRS 9. (34,390)

b) IFRS 15, Revenue from Contracts with Customers

IFRS 15 establishes a new model for the recognition of income, which highlights the concept of the transfer
to the client of the “control” of assets sold in place of the “risk” transfer concept referred to in IAS 18.
Additionally, it requires more detail in disclosures and makes more in-depth reference to contracts with sale
of multiple elements. The application of IFRS 15 has not materially affected the measurements of Codelco’s
revenue, and the disclosures required by this standard are set forth in notes 21 and 26 of section !1l ofthese
Consolidated Financial Statements.

c) Amendments to IFRS 4, Applying IFRS 9 “Financial Instruments” with IFRS 4 “Insurance Contracts”:

It instructs on aspects related to insurance contracts that will be affected upon entry into application of IFRS
9 – Financial Instruments. The application of these amendments had no impact on the consolidated financial
statements of the Corporation, however, it could affect the accounting for future transactions or agreements.
d) Amendments to IAS 40, Transfers of investment property:

These amendments clarify the requirements for the treatment of investment property transfers. The
application ofthese amendments had no impact on the consolidated financial statements of the Corporation,
however, it could affect the accounting for future transactions or agreements.

e) IFRIC 22 Foreign currency transactions and advance consideration:

This interpretation addresses the exchange rate to be used in foreign currency transactions, when the
consideration is paid or received before recognizing related revenue, expenses or related assets. The

application of this interpretation had no impact on the consolidated financial statements of the Corporation,
however, it could affect the accounting for future transactions or agreements.

38
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

New accounting pronouncements

a)

application is not yet mandatory:

The following new IFRS, amendments and interpretations had been issued by the lASB, but their

New IFRS

Date of mandatory application

Summary

IFRS 16 — Leases

Annual periods beginning on or after
January 1, 2019

Requires lessees to recognize
assets and liabilities for all rights
and obligations originated by
leases unless the lease term is 12
months or less or the underlying
asset has a low value, where such
expedients have been adopted by
an entity. Additional disclosure
requirements are also included.
Additionally, the Standard
establishes new requirements of
information to disclose related to
the risk exposure on the part of
lessors.

IFRS 17, Insurance Contracts

Annual periods beginning on or after
January 1, 2021

Establishes the principles for the
recognition, measurement,
presentation and disclosure of
insurance contracts, reinsurance
contracts and investment contracts
with discretional participating
features and supersedes IFRS 4
Insurance contracts.

Amendments to IFRS

Date of mandatory application

Summary

Amendment to IFRS 10 and
IAS 28: Sale or Contribution of
Assets

Date to be determined by IASB.

Recognizes the profits or losses of
sales of assets between an
investor and an associate or a joint
venture, which are recognized for
the total when the transaction
involves assets which constitute a
business and are recognized
partially when the assets do not
constitute a business.

39

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Features of prepayment with
negative compensation
(amendments to IFRS 9)

Annual periods beginning on or after
January 1, 2019.

It adds paragraphs on the
designation of financial assets and
liabilities, restatement of previous
periods and disclosures for
instruments repayable in advance
and provides additional clarity as to
the accounting effects should
prepayment features result in
negative compensation to the
creditor.

Long-term investments in
Associates and Joint Ventures
(amendments to lAS 28)

Annual periods beginning on or after
January 1, 2019.

It includes, within the scope of
IFRS 9, other financial instruments
in an associate or joint venture to
which the equity method does not
apply, including long-term
investments.

Annual improvements for the
2015-2017 cycle
(amendments to IFRS 3, IFRS
11, lAS 12 and lAS 23)

Annual periods beginning on or after
January 1, 2019.

Amendments to IFRS 3 and IFRS
11: Adds paragraphs on treatment
for acquisitions in previously held
shares in a joint operation.
Amendments to lAS 12: Adds
paragraphs on treatment of taxes
related to dividends payable.
Amendments to IAS 23: Modifies
wording on application of weighted
average rate.

Plan Amendment, Curtailment
or Settlement (Amendments to
lAS 19)

Annual periods beginning on or after
January 1, 2019.

It requires the use of actuarial
assumptions to determine the cost
of service of the current period and
the net interest for the remainder of
the reporting period prior to
determining the effect of the
application of “asset ceiling” after
the amendment, curtailment or
settlement of the plan when the
entity remeasures its liability
(asset) for defined benefits.

40

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Definition of a Business
(Amendments to IFRS 3)

Annual reporting period beginning on
or after 1 January 2020

Clarifies that to be considered a
business, an acquired set of
activities and assets must include,
at a minimum, an input and a
substantive process that together
significantly contribute to the ability
to create outputs

Definition of Material
(Amendments to lAS 1 and IAS
8)

Annual reporting periods beginning
on or after 1 January 2020

Clarifies the definition of ‘material’
and aligns the definition used in the
Conceptual Framework and the
standards.

Modifications Conceptual
Framework for the Report
Revised Financial

Annual periods initiated on or after
the 1st of January 2020

It incorporates some new
concepts, provides updated
definitions and recognition criteria
for assets and liabilities. This
modification accompanies a
separate document, “Modifications
to the References to Conceptual
Framework in the Rules IFRS “,
which establishes amendments to
other IFRS in order to update the
references to the new Conceptual
Framework

New Interpretations Date of mandatory application Summary
IFRIC 23: Uncertainty over| Annual periods beginning on or after | It establishes how to determine a
Income Tax Treatments January 1, 2019 tax position when there is

uncertainty about the treatment for
the income tax.

The Administration does not expect significant impacts with respect to standards, amendments and

interpretations indicated above.

With respect to IFRS 16, Management has evaluated the impact of its implementation on Codelco’s
Consolidated Financial Statements and has determined that the effects on the amounts of these financial
statements will not be significant. The changes in the disclosures will be presented in accordance, both in
term and in form, as established by IFRS 16.

41

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

lll. EXPLANATORY NOTES
1. Cash and cash equivalents

The detail of cash and cash equivalents as of December 31, 2018 and 2017, is as follows:

ltem 12/31/2018 | 12/31/2017
ThUS$ ThUS$
Cash on hand 25,033 3,300
Bank balances 59,030 124,275
Time deposits 1,131,049 1,306,476
Mutual Funds – Money Market 1,698 651
Repurchase agreements 12,315 14,133
Total cash and cash equivalents 1,229,125 1,448,835

Interest on time deposits is recognized on an accrual basis using the contractual interest rate of each of
these instruments.

The Corporation does not hold any significant amounts of cash and cash equivalents that have a restriction
on use.

2. Trade and other receivables
a) Accruals for open sales invoices
As mentioned in the Summary of Significant Accounting Policies Section, the Corporation adjusts ¡ts
revenues and trade receivable balances, based on future copper prices through the recognition of an

accrual for open sales invoices.

When future price of copper is lower than the provisional invoicing price, the accrual is presented in the
statement of financial position as follows:

– For those customers that have due balances with the Corporation the accrual is presented as a
deduction from the line item trade and other current receivables.

– For those customers that do not have due balances with the Corporation the accrual is presented
in the line item trade and other current payables.

When the future copper price is higher than the provisional invoicing price, the accrual is added to the
line item trade and other current receivables.

As of December 31, 2018 and 2017, due balances included a negative ThUS$96,396 and positive
ThUS$244,265, respectively for provisional pricing.

As of December 31, 2018, ThUS$5,025 for the provision for open invoices related to customers with
no outstanding amounts to Codelco, is presented in Trade accounts payable. This balance plus the

42
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

balance presented in trade and other receivables, totaling cumulative provisional pricing effect of
MUS$101,421.

Trade and other receivables

The following table sets forth trade and other receivables balances, with their corresponding
allowances for doubtful accounts:

Current Non-Current
Items 12/31/2018 12/31/2017 12/31/2018 12/31/2017
ThUuS$ ThUS$ ThUS$ ThUS$

Trade receivables (1) 1,542,420 2,178,788 820 1,887
Allowance for doubtful accounts (3) (37,811) (28,684) – –
Subtotal trade receivables, net 1,504,609 2,150,104 820 1,887
Other receivables (2) 712,446 674,425 83,911 89,555
Allowance for doubtful accounts (3) (4,846) (9,177) – –
Subtotal other receivables, net 707,600 665,248 83,911 89,555
Total 2,212,209 2,815,352 84,731 91,442

(1) Trade receivables correspond to the sales of copper and its by-products, those that in general
are sold in cash or through banks.

(2) Other receivables mainly consist of the following items:

» Corporation’s employee short-term loans and mortgage loans, both monthly deducted from
the employee’s salaries. Mortgage loans granted to the Corporation’s employees for
ThUS$55,484 are secured with collateral.

+ Reimbursement receivables from insurance companies.

+ Settlements from the Chilean Central Bank under Law 13196.

+ Advance payments to suppliers and contractors.

+ Accounts receivable for tolling services (Ventanas Smelter).

+ VAT creditand other refundable taxes of ThUS$201,274 and ThUS$147,589 as of December
31, 2018 and December 31, 2017, respectively.

(3) The Corporation recognizes an allowance for doubtful accounts based on its expected credit
loss model.

43
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The reconciliation of changes in the allowance for doubtful accounts in the year ended December 31,
2018 and 2017, ¡is as follows:

ltems 12/31/2018 12/31/2017
Thus$ Thus$

Opening balance 37.861 9.035
Initial adjustment NIIF 9 2.239 –
Initial balance adjusted 40.100 9.035
Net Increases 7.215 29.160
Write-offs/applications (4.658) (334)
Total movements 2.557 28.826
Closing balance 42.657 37.861

As of December 31, 2018 and 2017, the balance of past due but not impaired trade receivables, is as

follows:
. 12/31/2018 12/31/2017
Maturity
ThUS$ ThUS$

Less than 90 days 3,473 15,145
Between 90 days and 1 year 4,789 1,615
More than 1 year 10,266 10,389
Total trade receivables past-due but not impaired 18,528 27,149

3. Balance and transactions with related parties
a) Transactions with related persons

In accordance with the Law on New Corporate Governance and lAS 24, the members of Codelco’s
Board are, in terms of transactions with related persons, subject to the provisions of Title XVI of Law
on Corporations, which sets the requirements regarding transactions with related parties in publicly
traded companies and their subsidiaries.

Notwithstanding the foregoing, pursuant to the provisions of the final paragraph of Article 147 b) of Title
XVI, which contains exceptions to the approval process for transactions with related parties, the
Corporation has established a general policy over customary transactions (which was informed
through a significant event notice to the CMP), that defines customary transactions as those carried
out with its related parties in the normal course of business, which contributes to the social interest and
are necessary to the normal development of Codelco’s activities.

Likewise, consistent with the legal framework, the Corporation maintains within its internal framework
a specific policy about transactions between related persons and companies with Codelco’s
employees. Codelco’s Corporate Policy No.18 (*CCP No. 18”), the latest version currently in force, was
approved by the Chief Executive Officer and the Board of Directors.

44
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Accordingly, Codelco without the authorization required in CCP No. 18 and of the Board of Directors,
when required by Law or by the Corporation by-laws, shall not enter into any contracts or agreements
involving one or more Directors, its Chief Executive Officer, the members of Division’s Managing
Committees, Vice-presidents, Legal Counsel, General Auditor, Division Chief Executive Officers,
Advisors of Senior Management, employees who must make recommendations and/or have the
authority to award tenders, assignments of purchases and/or contracting goods and services, and
employees in management positions (up to fourth hierarchical level in the organization), including their
spouses, children and other relatives up to second degree of relation, with a direct interest, represented
by third parties or on behalf of another person. Likewise, CCP No. 18 requires administrators of
Corporation’s contracts to declare all related persons, and disqualify himself/herself if any related
persons are involved within the field of his/her job responsibilities.

This prohibition also includes the companies in which such administrators are involved through
ownership or management, either directly or through representation of other natural persons or legal
entities, as well as those individuals who also have ownership or management in those companies.

The Board of Directors has been informed and approved certain transactions as defined in CCP No.

18. The most significant transactions with related persons and the amounts involved are detailed in the
following table:

45
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

1/1/2018 1/1/2017
Entity Taxpayer Country] — Nature of the relationship Description of the 12/31/2018 12/31/2017
number transaction Amount Amount
Thus$ ThUuS$
Administración de Sistemas y Servicios Herman . , .
76.349.138-2 Chile [Employee’s relative Services 200 –
‘Yerko Valenzuela Rojas E.LR.L
Anglo American Sur S.A. 77.762.940-9 Chile [Associate Supplies 55 3
Arcadis Chile S.A. 89.371.200-3 Chile [Employee’s relative Services 3,511 –
Arriendo de Maquinaria Marcelo Enrique Balocchi Vivg 76.300.049-4 Chile [Employee’s relative Services – 95
Asociación Chilena de Seguridad 70.360.100-6 Chile [Member of Board of directors Services 852 –
B.Bosch S.A. 84.716.400-K Chile [Employee’s relative Supplies – 60
Centro de Capacitación y Recreación Radomiro Tomi 75.985.550-7 Chile [Other related Services 847 177
Codelco Tec SpA 96.991.180-9 Chile [Subsidiary Services 10,000 –
Consultor Jannet Troncoso Carvajal E.I.R.L. 76.174.237-K Chile [Employee’s relative Supplies – 74
Distribuidora Cummins Chile S.A. 96.843.140-4 Chile [Employee’s relative Supplies – 302
Ecometales Limited agencia en Chile. 59.087.530-9 Chile [Subsidiary Services 20,040 462
Exploraciones Mineras Andinas S.A. 99.569.520-0 Chile [Subsidiary Services 358,130 –
Fundación de Salud El Teniente. 70.905.700-6 Chile [Subsidiary Services – 13
Fundación Orquesta Sinfónica Infantil de los Andes. 65.018.784-9 Chile |Founder member donor Services 297 247
Fundación Sewell 65.493.830-K Chile [Founder member donor Services – 421
Geotermica del Norte S.A. 96.971.330-6 Chile [Employee’s relative Services – 3,912
Glasstech S.A. 87.949.500-8 Chile [Employee’s relative Supplies 3 –
Industrial Support Company Ltda 77.276.280-1 Chile [Employee’s relative Services – 218
Industrial y Comercial Artimatemb Ltda. 76.108.720-7 Chile [Employee’s relative Services 28 40
Inoxa S.A. 99.513.620-1 Chile [Employee’s relative Services 468 14
Institución de Salud Previsional Chuquicamata Ltda. 79.566.720-2 Chile [Subsidiary Services 22 15,571
Institución de Salud Previsional Río Blanco Ltda. 89.441.300-K Chile [Subsidiary Services 47,028 –
Isapre Fusat Ltda, 76.334.370-7 Chile [Subsidiary Services – 126,800
Kaefer Buildteck SpA 76.105.206-3 Chile [Employee’s relative Services – 97
Kairos Mining S.A. 76.781.030-K Chile [Other related Services 13,700 –
Komatsu Chile S.A. 96.843.130-7 Chile [Employee’s relative Services and Supplies 138,962 208,437
Linde Gas Chile S.A. 90.100.000-K Chile [Employee’s relative Supplies 91 –
Nueva Ancor Tecmin S.A. 76.411.929-0 Chile [Employee’s relative Supplies – 83
San Lorenzo Isapre Limitada 76.521.250-2 Chile [Subsidiary Services 25,945 –
Servicios de Ingeniería IMA S.A. 76.523.610-K Chile [Employee’s relative Services 125 –
Sociedad Contractual Minera El Abra. 96.701.340-4 Chile [Associate Supplies – 134
Sociedad de Procesamiento de Moblibdeno Ltda, 76.148.338-2 Chile [Subsidiary purchase of products – 1
Sodimac S.A. 96.792.430-K Chile [Employee’s relative Supplies – 2,132
Sonda S.A. 83.628.100-4 Chile [Employee’s relative Services – 1,446
Sourcing SpA. 76.355.804-5 | Chile [Employee’s relative Services – 1,259
Teléfonica Chile S.A. 90.635.000-9 Chile [Employee’s relative Services – 99
Transelec Norte S.A. 99.521.950-6 Chile [Member of Board of directors Services 4,411 –
Ziiblin International GmbH Chile SpA 77.555.640-4 Chile [Employee’s relative Services – 117,637

b) Key Management of the Corporation

In accordance with the policy established by the Board of Directors and its related regulations, the
transactions with the Directors, its Chief Executive Officer, Vice Presidents, Corporate Auditor, the
members of the Divisional Management Committees and Divisional General Managers shall be

approved by the Board of Directors.

During the years ended December 31, 2018 and 2017, the members of the Board of Directors have

received the following amounts as per diems, salaries and fees:

46

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

1/1/2018 | 1/1/2017
Name Taxpayer number] Country Nature of the Description of the | 12/31/2018 | 12/31/2017

relationship transaction Amount | Amount

ThUuS$ | ThuS$
Blas Tomic Errázuriz 5.390.891-8 Chile [Director Directors’s fees 122 118
Dante Contreras Guajardo 9.976.475-9 Chile Director Directors’s fees 34 95
Gerardo Jofré Miranda 5.672.444-3 Chile [Director Directors’s fees – 38
Ghassan Dayoub Pseli 14.695.762-5 Chile Director Directors’s fees 97 71
Ghassan Dayoub Pseli 14.695.762-5 Chile Director Payroll 107 72
Hernán de Solminihac Tampier 6.263.304-2 Chile Director Directors’s fees 63 –
Ignacio Briones Rojas 12.232.813-9 Chile Director Directors’s fees 63 –
Isidoro Palma Penco 4.754.025-9 Chile [Director Directors’s fees 97 95
Juan Benavides Feliú 5.633.221-9 Chile ¡Chairman ofthe Board Directors’s fees 95 –
Juan Morales Jaramillo 5.078.923-3 Chile [Director Directors’s fees 97 95
Laura Albornoz Pollmann 10.338.467-2 Chile [Director Directors’s fees 34 95
Oscar Landerretche Moreno 8.366.611-0 Chile ¡Chairman ofthe Board Directors’s fees 51 142
Paul Schiodiz Obilinovich 7.170.719-9 Chile [Director Directors’s fees 97 64
Raimundo Espinoza Concha 6.512.182-4 Chile Director Directors’s fees 97 95
Raimundo Espinoza Concha 6.512.182-4 Chile Director Payroll 64 53

The Ministry of Finance through Supreme Decree No. 100, dated February 5, 2018, established the
compensation for the Corporation’s Directors. The compensation to Board of Director members, is as

follows:

a. The Directors of Codelco will receive a fixed monthly compensation of Ch$3,931,757 (three million
nine hundred and thirty one thousand, seven hundred and fifty seven Chilean pesos) for meeting
attendance. The payment of the monthly compensation is dependent on meetings attended.

b. The Chairman of the Board will receive a fixed monthly compensation of Ch$7,863,513 (seven

million eight hundred and sixty three thousand, five hundred and thirteen Chilean pesos).

Cc. Each member of the Directors” Committee, whether the one referred to in Article 50 bis) of Law
No. 18046 or another established by the Corporation by-laws, will receive a fixed additional
monthly compensation of Ch$1,310,584 for meeting attendance, regardless of the number of
committees of which they are members. In addition, the Chairman of the Directors’ Committee will

receive a fixed monthly compensation of Ch$2,621,171 for meeting attendance.

d. The compensation established in DS No. 36 is effective for a period of two years, as from March
1, 2018, and will be updated on January 1, 2019, in accordance with the same provisions that

govern the general salary adjustments of officials of the public sector.

On the other hand, the short-term benefits of key management of the Corporation paid during the
periods ended December 31, 2018 and 2017, were ThUS$12,382 and ThUS$10,899,

respectively.

47

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

c)

The methodology to determine the remuneration of key management was approved by the Board
of Directors at a meeting held on January 29, 2003.

During the ended December 31, 2018 and 2017, severance indemnities were paid to key
management of the Corporation for TAUS$1,084 and ThUS$471, respectively.

There were no payments to key management for other non-current benefits during the periods
ended December 31, 2018 and 2017.

There are no share based payment plans granted to Directors or key management personnel of
the Corporation.

Transactions with companies in which Codelco has ownership interest
The Corporation undertakes commercial and financial transactions that are necessary for ¡ts activities
with its subsidiaries, associates and joint ventures (“related parties”). The financial transactions
correspond mainly to loans granted (mercantile current accounts).
Commercial transactions with related companies mainly consist of purchases/sales of products or
rendering of services carried out under market conditions and prices, which do not bear any interest or
indexation.
As of the date of these financial statements, the Corporation has not recognized any allowance for
doubtful accounts with respect to receivable balances from ¡ts related companies.
The detail of accounts receivable and payable between the Corporation and its related parties as of
December 31, 2018 and 2017, is as follows:
Accounts receivable from related companies:
7 Nat Fin Indexati Current Non-current
ee Name Country meo ve non 12/31/2018 | 12/31/2017 | 12/31/2018 | 12/31/2017
number relationship currency
ThUS$ TUSS ThUS$ TUSS
77.762.940-9 ‘Anglo American Sur S.A. Chile Associate US$ 88,497 63,596 –
76.063.022-5 Inca de Oro S.A. Chile Associate US$ 380 199 – –
76.255.054-7 Planta Recuperadora de Metales SpA Chile Associate US$ 3,099 – 20,306 25,581
196.701.340-4 Sociedad Contractual Minera El Abra Chile Associate US$ 383 549 – –
196.801.450-1 ¡Agua de la Falda S.A Chile Associate US$ 6 – 224 249
Totals 92,365 64,344 20,530 25,830

48
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

d)

Accounts payable to related companies:

. Current Non-current
Taxpayer Nature of the Indexation
Name Country a Si 12/31/2018 | 12/31/2017 | 12/31/2018 | 12/31/2017
number relationship currency
ThHUS$ ThHUS$ THUS$ THUSS$
77.762.940-9 Anglo American Sur S.A. Chile Associate US$ 125,913 92,315 –
196.701.340-4 Sociedad Contractual Minera El Abra Chile Associate US$ 22,940 25,370
Foreign Deutsche Geissdraht GmbH Germany Associate EURO 6,106
76.255.054-7 Planta Recuperadora de Metales SpA Chile Associate US$ 2,063 –
Totals 150,916 123,791

The following table sets forth the transactions carried out between the Corporation and its related
companies and their corresponding effects in profit or loss for the years ended December 31, 2018 and

2017:
1/1/2018 1/1/2017
12/31/2018 12/31/2017
Effects on net Effects on net
Taxpayer a a Index. . .
number Entity Nature of the transaction | Country Currency income (charges) I income (charges) 1
Amount credits Amount credits
ES THus$ ES ES

96.801.450-1 | Agua de la Falda S.A. Sales of services Chile CLP 4 4 5 5
96.801.450-1 | Agua de la Falda S.A. Capital contribution Chile CLP 338 –
77.762.940-9 | Anglo American Sur S.A. Dividends received Chile US$ 182,903 187,346
77.762.940-9 | Anglo American Sur S.A. Dividends receivable Chile US$ 84,372 – 59,003 –
77.762.940-9 | Anglo American Sur S.A. Sales of goods Chile US$ 58,411 58,411 76,065 76,065
77.762.940-9 | Anglo American Sur S.A. Sales of services Chile CLP 8,162 8,162 6,598 6,598
77.762.940-9 | Anglo American Sur S.A. Purchase of products Chile US$ 711,384 (711,384)| 714,340 (714,340)
77.762.940-9 | Anglo American Sur S.A. Capital contribution Chile US$ – – – –

Foreign | Deutsche Geissdraht GmbH Dividends received Germany | EURO 946 – 1,119
76.063.022-5 [Inca de Oro S.A. Sales of services Chile CLP 214 2 169 –
76.255.054-7 |Planta Recuperadora de Metales SpA Interest loans Chile US$ 1,029 1,029 1,029 1,029
76.255.054-7 |Planta Recuperadora de Metales SpA Services Chile US$ 23,443 (23,443) 26,065 (26,065)
76.255.054-7 |Planta Recuperadora de Metales SpA Sales of goods Chile US$ 940 940 – –
96.701.340-4 [Soc. Contractual Minera El Abra Dividends received Chile US$ 4,900 – 39,200 –
96.701.340-4 |Soc. Contractual Minera El Abra Purchase of products Chile US$ 293,173 (293,173)| 245,954 (245,954)
96.701.340-4 |Soc. Contractual Minera El Abra Sales of goods Chile US$ 24,796 24,79 9,516 9,516
96.701.340-4 [Soc. Contractual Minera El Abra Other sales Chile US$ 1,493 1,493 1,493 1,493
96.701.3404 [Soc. Contractual Minera El Abra Perceived commissions — [Chile US$ 113 113 9% 9%
96.701.340-4 |Soc. Contractual Minera El Abra Other purchases Chile US$ 992 (992)
76.028.880-2 |Sociedad Contractual Minera Puren Dividends received Chile US$ 178 –

Additional information

The current account receivable from Planta Recuperadora de Metales SpA. corresponds to the loan
agreement granted to build its plant, which was signed on July 7, 2014.

The purchase/sales of products transactions with Anglo American Sur S.A., are regular business
activity transactions to buy/sell copper and other products. On the other hand, there are certain
transactions related to the contract entered into with the subsidiary Inversiones Mineras Nueva Acrux

49

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

SpA (whose non-controlling shareholder is Mitsui) and Anglo American Sur S,A,, under which the latter
agreed to sell a portion of its annual copper output to said subsidiary.

Inventories

The detail of inventories as of December 31, 2018 and 2017, is as follows:

Current Non-current
ltems 12/31/2018 12/31/2017 12/31/2018 12/31/2017
ThUS$ ThUS$ ThUuS$ ThUS$

Finished products 446,344 348,083 –

Subtotal finished products, net 446,344 348,083 – –
Products in process 1,137,605 1,105,590 457,070] 428,447
Subtotal products in process, net 1,137,605| 1,105,590 457,070| 428,447
Material in warehouse and other 555,504 470,108 – –
Obsolescence allowance adjustment (96,805) (94,083)

Subtotal material in warehouse and other, net 458,699 376,025 – –
Total Inventories 2,042,648 1,829,698 457,070] 428,447

The amount of inventories of finished goods transferred to cost of sales for the years ended December 31,
2018 and 2017 were ThUS$11,145,242 and ThUS$10,341,613, respectively.

For the years ended December, 2018 and 2017, the Corporation has nat reclassified strategic inventories
to Property, Plant and Equipment.

The reconciliation of changes in the allowance for obsolescence ¡s detailed below:

: 12/31/2018 12/31/2017
Changes in Allowance for Obsolescence ThUS$ ThUs$
Opening Balance (94,083) (90,930)
Period provision (2,722) (3,153)
Closing Balance (96,805) (94,083)

For the years ended December 31, 2018 and 2017, the Corporation recognized write-offs of damaged
inventories for ThUS$4,004 and ThUS$4,126 respectively.

The provision for the net realizable value of inventories was ThUS$31,889 for the year ended December
31, 2018 (ThUS$3,000 at December 31, 2017).

During the years ended December 31, 2018 and 2017, decreases in the provision for net realizable value
were ThUS$28,890 and ThUS$3,744, respectively.

As of December 31, 2018 and 2017, there are no unrealized gains or losses recognized on the
intercompany sales of inventories of finished products.

As of December 31, 2018 and 2017, there are no inventories pledged as security for liabilities.

50
5.

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

Income taxes and deferred taxes

a) Composition of income tax expense

1/1/2018 1/1/2017
Items 12/31/2018 | 12/31/2017

ThUus$ ThUs$
Currentincome tax (92,270) (72,897)
Effect of Deferred Taxes (249,217) (1,126,918)
Adjustments to current tax from the prior period (19,956) –
Other 4,160 6,748
Total tax expense (357,283) (1,193,067)

b) Deferred tax assets and liabilities:

The following table details deferred tax assets and liabilities:

Deferred tax assets 12/31/2018 12/31/2017
ThUus$ ThUuS$
Provisions 1,429,060 1,264,736
Financial leasing 13,162 24,983
Customers advance 250,255 1,013,438
Other 4,603 23,690
Total deferred tax assets 1,697,080 2,326,847
ner 12/31/2018 12/31/2017
Deferred tax liabilities Thus$ ThUS$
Tax on mining activity 163,280 183,571
Property, plant and equipment variations 889,841 1,058,609
Post-employment beneft obligations 10,346 21,532
Accelerated depreciation for tax purposes 5,017,532 5,168,062
Fair value of mining properties acquired 108,518 108,518
Hedging derivatives — future contracts 12,282 5,635
Undistributed profits of subsidiaries 50,006 45,177
Other – 6,695
Total deferred tax liabilities 6,251,805 6,597,799

Deferred taxes 12/31/2018 12/31/2017
ThUuS$ ThUus$
Non-current assets 31,443 43,285
Non-current liabilities 4,586,168 4,314,237
Net 4,554,725| 4,270,952.

The following tables sets forth the deferred taxes as presented in the statement of financial position:

51
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The effects of deferred taxes on the components of other comprehensive income are as follows:

12/31/2018 | 12/31/2017

Deferred taxes on components of other comprehensive income ThUS$ ThUS$

(Charge) credit cash fiow hedge (67,704) 1,868
Defined Benefit Plans 33,148 (16,937)
Total deferred taxes on components of other comprehensive income (loss) (34,556) (15,069)

The following table sets forth the reconciliation of the effective tax rate:

12/31/2018
Reconciliation of tax rate Taxable Base Atthe Taxrate

25,0% 40,0% 5% 25,0% 40,0% 5% Total

TRUS$ THUS$ THUS$ ThUS$ THUS$ THUS$ LES
Tax effect on the income (loss) before taxes 498,216 498.216 498.216 (124.554) (199.286) (24.911) (348.751)
Tax effect on the income (loss) before taxes of subsidiaries 48.814 48.814 48.814 (12.204) (19.526) (2.441) (34.171)
Tax effect consolidated profit (loss) before taxes 547.030 547.030 547.030 (136.758) (218.812) (27.352) (382.922)
Permanent differences:
First category income tax (25% ) (96.902) 24.226 24.226
Specific tax for state-owned entities Art 2 D.L. 2398 (40% ) (114.392) 45.757 45.757
Specific tax on mining activities 868.189 (43.409) (43.409)
Single Tax Art 21 Inc. N*1 (3.856)
Others 2.921
TOTAL TAX EXPENSE (112.532) (173.055) (70.761) (357.283)

12/31/2017
Reconciliation of tax rate Taxable Base Atthe Tax rate

25,0% 40,0% 5% 25,0% 40,0% 5% Total

TRUS$ THUS$ THUS$ ThUS$ THUS$ THUS$ LES
Tax effect on the income (loss) before taxes 1.786.885 1.786.885 1.786.885 (446.721) (714.754) (89.344) (1.250.819)
Tax effect on the income (loss) before taxes of subsidiaries 29.784 29.784 29.784 (7.446) (11.914) (1.489) (20.849)
Tax effect consolidated profit (loss) before taxes 1.816.669 1.816.669 1.816.669 (454.167) (726.668) (90.833) (1.271.668)
Permanent differences:
First category income tax (25% ) (228.408) 57.102 57.102
Specific tax for state-owned entities Art 2 D.L. 2398 (40% ) (113.268) 45.307 45.307
Specific tax on mining activities 400.028 (20.001) (20.001)
Tax effect of non-usable tax loss (3.807)
TOTAL TAX EXPENSE (897.065) — (681.361) (110.834) (1.193.067)

Pursuant to Article 2 of the Decree Law 2398, Codelco is subject to an additional tax rate of 40% on
income before taxes and dividends received in accordance with the law.

Tax Reform in Chile

On September 29, 2014, Law No. 20780 entitled “Tax Reform which modifies the Income Tax System,
and which introduces various adjustments on the Tax System”, was enacted.

52

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

The principal changes, among others, was the creation of two optional tax systems: (i) The Attributed
Income System established a progressive increase in the first category income tax rate to 21%, 22.5%,
24% and 25% for fiscal years 2014, 2015, 2016 and 2017, respectively; and (ii) the Partially Integrated
System, established a progressive increase in the first category income to 21%, 22.5%, 24%, 25.5%
and 27% for fiscal years 2014, 2015, 2016, 2017 and 2018, respectively.

Notwithstanding the above, the Corporation has applied the General Taxation Regime, with
progressive first category income tax rates of 21%, 22.5%, 24% and 25% for fiscal years 2014, 2015,
2016 and 2017 onwards, respectively. The Corporation, as a state-owned company, did not have the
option to apply the tax regimes stated in the Tax Reform. Meanwhile, the subsidiaries and associates
applied the partially integrated tax system by default.

In relation to the specific tax on mining activities the tax rate applicable is a 5% under Law No. 20469.
The Corporation, as a Taxpayer of first category, is liable to the single Tax of 40%, contained in the
first paragraph of Article 21 of the Income Tax Law No. 824, in numbers i), li) and iii) , the disbursements
incurred in said numerals.

6. Current and non-current tax assets and liabilities

The current tax balance is presented net of monthly provisional payments as an asset or liability in Current
Taxes, as the case may be, determined as indicated in section II. Main accounting policies, 2.1):

12/31/2018 | 12/31/2017

Current Tax Assets ThUSS$ ThUS$
Taxes to be recovered 13,645 21,623
Total Current Tax Assets 13,645 21,623

12/31/2018 | 12/31/2017

Current Tax Liabilities ThUSs$ ThUS$

Provision Specific tax on mining activities – 46,710
PPM Provision 6,910 4,418
Provision Tax 3,867 7,562
Total Current Tax Liabilities 10,777 58,690
ltems 12/31/2018 | 12/31/2017
ThUS$ ThUS$

Non-Current Tax Assets 143,606 233,772
Total Non-Current Tax Assets 143,606 233,772

Non-current recoverable taxes correspond to advance tax payments made provisionally and which are
probable of realization through utilization on future income tax returns. These non-current recoverable taxes
are not expected to be utilized in the current period. The Corporation has tax loss carryforwards of
ThUS$355,143.

53
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

7.

Non-current assets or groups of assets for disposition classified as held for sale

As of December 31, 2017, the balance of Non-current assets or groups of assets for disposal, classified as
held for sale, of the consolidated current assets, corresponds in its entirety to the shareholding held by the
Corporation at that date of the company Deutsche Giessdraht GmbH. The affiliate Codelco Kupferhandel
GmbH, has a 40% interest in the capital of the company Deutsche Giessdraht GmbH.

On July 31, 2018, the sale of the shares related to the ownership interest held by CK in Deutsche
Giessdraht GmbH was completed. The acquirer entity was Aurubis AG, which was, the major shareholder
of DG before the sale transaction. The gain after taxes for this transaction was Th€ 15,214 (ThUS$
18,172) and is included in the item Other income.

As of December 31, 2018, there are no balances of non-current assets or disposal groups classified as
held for sale.

Property, Plant and Equipment

a) The items of property, plant and equipment as of December 31, 2018 and 2017, are as follows:

Property, Plant and Equipment, gross 12/31/2018 1213112017

ThUS$ ThUS$
Construction in progress 8,808,652 7,004,522
Land 173,926 175,039
Buildings 5,403,295 5,375,235
Plant and equipment 15,894,046 15,150,823
Fixtures and fitings 58,807 58,839
Motor vehicles 2,062,920 2,018,740
Land improvements 5,619,800 5,296,402
Mining operations 7,214,915 6,785,364
Mine development 4,117,362 4,183,572
Other assets 1,380,354 1,346,712
Total Property, Plant and Equipment, gross 50,734,077 47,395,248

Property, Plant and Equipment, accumulated depreciation 12/31/2018 1213112017

ThUS$ ThUS$
Construction in progress – –
Land 8,964 7,953
Buildings 3,048,902 2,884,706
Plant and equipment 10,125,253 9,490,638
Fixtures and fitings 43,878 40,997
Motor vehicles 1,378,911 1,275,198
Land improvements 3,267,244 3,048,921
Mining operations 4,718,591 4,178,325
Mine development 804,318 688,342
Other assets 573,018 504,656
Total Property, Plant and Equipment, accumulated depreciation 23,969,079 22,119,736

54
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the consolidated financial statements originally issued in Spanish — see Note 1.2)

: 12/31/2018 12/31/2017

Property, Plant and Equipment, net ThUS$ ThUS$

Construction in progress 8,808,652 7,004,522
Land 164,962 167,086
Buildings 2,354,393 2,490,529
Plant and equipment 5,768,793 5,660,185
Fixtures and fitings 14,929 17,842
Motor vehicles 684,009 743,542
Land improvements 2,352,556 2,247,481
Mining operations 2,486,324 2,607,039
Mine development 3,313,044 3,495,230
Other assets 807,336 842,056
Total Property, Plant and Equipment, net 26,754,998 25,275,512

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Movement of Property, plant and equipment:

oemens Constructionin | Land | Buildings | Plantand [Fixedinstalaions andy; epicios| — Ground Ma aval Other Total
ThUS$ equipment accessories , operations |Developmentof | assets
progress improvements mines
Reconciliation of changes in properties, plant and equipment
Properties, plant and equipment al the beginning ofhe period. Opening Balance 1/4/2018 7,004,522 — 167.086] — 2,490,520] 5,660,185 17842] 749,542 2.247.481] 2607.09] 3405230] 842056] — 25275512
Changes in property, plant and equipment
Increases other than those ffom business, propery, plant and equipment combinatons 3,582,688) . 138 21,008 376 1,383 484 375.575 1,125 38478] — 4021275
Deprecialion, property, plant and equipment 3 (aom| (167,547) (657,866) (3569) — (119,872) (218,323) (859,955) (80,159)| — (70299) — (2.172,605)
Impaimentlosses recognized in proftor loss for the period (2179) (62,585) (98,77) – (140) (4,786) . (10:53) (198,808)
Increases (decreases) in transfers and other changes, properties, plant and equipment
Increases (decreases) by transfers from constuctons in process, properties, plant and equipment (1,281,365) 102888 812.901 647 51,758 191,986 21,168 99.681 359 .
Increases (decreases) by other changes, properties, plant and equipment (851,945) — (1,113) 11,228 38,322 (68) 2.879 135,714 342.497 (202,889) 75% (17,780)
Increase (decrease) by transfers and other changes, properties, plant and equipment (1,600,310) — (11413) 114.008 851,223 579 54,697 327,700 360,665 (103-158) 7,895] (17,789)
Dispositions and witherawals of service, property, plant and equipment
Retements, properiy, plant and equipment (143,069) (235) (7,400) (199) (1541) . (268) (152,407)
Dispositions and witherawals of service, property, plant and equipment (143,069) . (235) (7,400) (199) (1,544) . . (e88) (15240)
Increase (decrease) in properties, plant and equipment 1,804,130 (2,124| — (136,136) 108,608 (2913)| (69,539) 105,075] (120,715) (182,486)| — (34,720)| — 1,479,486
Properties, plant and equipment at the end of the period. Closing balance 12/31/2018 8,808,652] — 164,962] — 2,354,399] 5,768,793 14,929] 684,009] 2.352,556] ——2,86,324[ 3,313,044] —807,336| — 26,754,998
Movements Plantand — [Fixed installations and . Minin Other
muss Construction in | Land | ungings | equipment accessories [Motorvehicies| Ground operations Development of | assets Jotal
progress improvements mines
Reconciliation of changes in properties, plant and equipment
Properties, plant and equipment the beginning of the year. Opening Balance 1/1/2017 6260471] — 144415] — 2407188] — 5402668 13,150] 807087 2.089.866] 2598209) 3407706 900536| — 23,977,261
Changes in property, plant and equipment
Increases other than those ffom business, property, plant and equipment combinations 3,061,027] — 2814 2,76 54,962 5 3207 20.081 395,786 2984] 27524 3,511,192
Depreciaton, property, plant and equipment (1:29) (161,592) (632,410)| (3465) — (117366) (225,571) (807,000) (82.627)| — (65549) — (2,096,809)
Impairmentlosses recognized in profitor loss for the year – – – – – – – – – – –
Increases (decreases) in transfers and other changes, properties, plant and equipment
Increases (decreases) by transfers from constructons in process, propertes, plant and equipment (1406.450)| — 16.959] 187,749 690,167 7,581 50,908 311,076 58,806 163,908| — 10201 .
Increases (decreases) by obher changes, propertes, plant and equipment (624,685) 5021 86813 220,085 441 3014 52,861 481,238 32641 — (256558) 2.400
Increase (decrease) by transfers and other changes, properties, plant and equipment (2231,135| — 20.986 244,562 850,252 8/22 53,922 363,937 540,044 167,167| — (15451) 2,400
Dispositions and withdrawals of service, property, plant and equipment
Retremenis, propery, plant and equipment (91,841) (2.387) (15.267) (19) (3.288) (692) (4898) — (118,592)
Dispositions and withdrauals of service, property, plant and equipment (91,841) . (2,387) (15,267) (19) (0288) (632) . (4898) (118,592)
Increase (decrease) in properties, plant and TO8.051| 22,671 89,346 257,521 4602| (63,525) 157,615 68,890 87,524 (58,480) 1,208,251
Properties, plant and at the end of the year. Closing balance 12/31/2017 7,004,522] —167,086| 2,490,520] 5,660,185 17,842] —— 743,542 2,247,481] 2,607,039[ 3,495,230] —84Z056| — 25,275,512

56

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

c)

The balance of construction in progress, is directly associated with the operating activities of the
Corporation, and relates to the acquisition of equipment for projects in construction and associated
costs toward their completion.

The Corporation has signed insurance policies to cover the possible risks to which the various
property, plant and equipment items are subject, as well as the possible claims that may arise for the
period of its activities. Such policies sufficiently cover the risks to which they are subject in
Management’s opinion.

Borrowing costs capitalized for the years ended December 31, 2018 and 2017 were ThUS$311,399
and ThUS$217,031, respectively. The annual capitalization average rate for the years ended
December 31, 2018 and 2017 was 4.42% and 4.04%, respectively.

Expenses on exploration and drilling of deposits recognized in profit or loss and the cash outflows
disbursed for the same concepts are presented in the following table:

1/11/2018 1/11/2017
Expenditure on exploration and drilling reservoirs 12/31/2018 | 12/31/2017
ThUS$ ThUS$
Recognized in profit /(loss) 50,765 46,068
Cash outfows disbursed 62,857 76,010

The detail of “Other assets” under “Property, plant and equipment” is as follows:

Other assets, net 12/31/2018 | 12/31/2017
: Thus$ ThUs$
Leased assets 93,334 91,628
Mining properties from the purchase of Anglo American Sur S.A. shares 402,000 402,000
Maintenances and other major repairs 235,091 254,253
Other assets — Calama Plan 72,225 90,281
Other 4,686 3,894
Total other assets, net 807,336 842,056

During the first quarter of 2018, US$103.6 million were reclassified from the line item Intangible
assets other than goodwill, to Construction in Progress of Property, plant and equipment,
corresponding to assets of the Continuous Mining project (see note 10 Intangible Assets other than
goodwill) that could potentially be used in other operations and / or projects of the Corporation.

Subsequently, US$66.4 million (US$23 million after taxes) from the assets mentioned above were
written off as of June 30, 2018.

The Corporation currently has no ownership restrictions relating to assets belonging to Property,
plant and equipment, except for leased assets whose legal title corresponds to the lessor.

57
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

j)

Codelco has not pledged any items of property, plant and equipment as collateral to third parties in
order to enable the realization of its normal business activities or as a commitment to support
payment obligations.

According to the policy indicated in note 2 ¡), referring to property, plant and equipment and intangible
assets, and as indicated in note 23, for the year ended December 31, 2018, the Corporation
recorded an impairment in the value of the Ventanas assets for an amount of ThUS $ 198,898 before
taxes. At 31 December 2017, the property, plant and equipment assets showed no indicators of
impairment or reversals of impairments recognized in previous years, so that no adjustments were
made to the value of the assets at that date. (see note 23).

Investments accounted for using the equity method

The following table sets forth the carrying amount and the share of profit (loss) ofthe investments accounted
for using the equity method:

Equity Interest Carrying Value Net income (loss)
Associates Taxpayer Funct. Cuurenc. 11112018 41112017
Numbers 12/31/2018 12/31/2017 12/31/2018 12/31/2017 12/31/2018 12/31/2017
% % Thus$ Thus$ Thus$ Thus$
[Agua de la Falda S.A. 96.801.450-1 US$ 42.26% 42.26% 4,953 4,943 (329)| (422)
¡Anglo American Sur S.A. 77.762.940-9 US$ 29.5% 29.5% 2,835,412 2,945,084 99,709 163,775
Deutsche Geissdraht GmbH Foreign EURO 40.0% 40.0% – – 1,159 1,375
Inca de Oro S.A. 73.063.022-5 US$ 33.19% 33.19% 12,913 12,942 (42) (104)|
Minera Purén SCM 76.028.880-2 US$ 35.0% 35.0% 9,902 9,897 8 (16)
Planta Recuperadora de Metales SpA 76.255.054-7 US$ 34.0% 34.0% 10,365 10,916 55 (74)
¡Sociedad Contractual Minera El Abra 96.701.340-4 US$ 49.0% 49.0% 610,339 605,769 10,181 15,343
¡Sociedad GNL Mejillones S.A. 76.775.710-7 US$ 37.0% 37.0% 84,409 76,050 8,373 5,551
[TOTAL 3,568,293 3,665,601 119,114 185,428
a) Associates
Agua de la Falda S.A.

As of December 31, 2018, Codelco holds a 42.26% ownership interest in Agua de la Falda S.A., with
the remaining 57.74% owned by Minera Meridian Limitada.

The corporate purpose of this company is to exploit deposits of gold and other minerals, in the third
region of Chile.

Sociedad Contractual Minera El Abra
Sociedad Contractual Minera El Abra was incorporated in 1994. As of December 31, 2018, Codelco
holds a 49% ownership interest, with the remaining 51% owned by Cyprus El Abra Corporation, a

subsidiary of Freeport-McMoRan Copper 8 Gold Inc.

The company business activities involve the extraction, production and selling copper cathodes.

58

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Sociedad Contractual Minera Purén

As of December 31, 2018, Codelco holds a 35% ownership interest, with the remaining 65% owned by
Compañía Minera Mantos de Oro.

This company’s corporate purpose is to explore, identify, survey, investigate, develop and exploit
mining deposits in order to extract, produce and process minerals.

Sociedad GNL Mejillones S.A.

As of December 31, 2018, Codelco holds a 37% ownership interest, with the remaining 63% owned by
Suez Energy Andino S.A. These current shareholdings were established on November 5, 2010, when
the Corporation did not participate in the capital increase agreed to at Shareholders’ meeting of such
company. Prior to the capital increase, the Corporation and Suez Energy Andino S.A. held a 50%
ownership interest each.

The corporate purpose of this company is the production, storage, marketing, transportation and
distribution of all types of fuel, and the acquisition, construction, maintenance and operation of
infrastructure facilities and construction projects necessary for transport, reception, processing and
storage both in Chile and abroad, by itself or in partnership with third parties.

Inca de Oro S.A.

On June 1, 2009, Codelco’s Board of Directors authorized the incorporation of a new company aimed
to develop studies allowing the continuity ofthe Inca de Oro Project, which is a wholly-owned subsidiary
of Codelco.

On February 15, 2011, the business association of Codelco and Minera PanAust IDO Ltda. in respect
to the Inca de Oro deposit was approved. As a result Minera PanAust IDO Ltda holds 66% ownership
interest and the remaining 34% is held by Codelco.

Prior to the association, Codelco owned 100% of the company. This transaction resulted in a gain after
taxes of ThUS$33,668 recognized in the year ended December 31, 2011.

At the Extraordinary meeting of the shareholders held on December 30, 2014, a capital increase of
ThUS$102,010 was agreed upon, reducing Codelco’s ownership interest to 33.19%.

As of December 31, 2015, the Corporation reduced the carrying amounts of mining property and
exploration and evaluation expenditures as a result of an impairment loss recognized.

As of December 31, 2018, Codelco holds a 33.19% ownership interest in this company.

59
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Planta Recuperadora de Metales SpA

On December 3, 2012, Planta Recuperadora Metales SpA was incorporated by Codelco, which held a
100% ownership interest of this company.

On July 7, 2014, Codelco reduced its ownership interest in Planta Recuperadora de Metales SpA to
51%, with the remaining 49% ownership interest held by LS-Nikko Copper Inc.

On October 14, 2015, Codelco reduced its ownership interest to 34% interest, with LS-Nikko Copper
Inc, holding the remaining 66%.

As of December 31, 2018, LS-Nikko Copper Inc, is the controlling shareholder of this company based
on the control elements set out in the shareholders’ agreement.

The principal business activity of the company is the processing of intermediate products of the refining
and processing of copper and other metals aiming to recover the copper, other metals and other sub
products, their transformation to commercial products and the selling and distribution of all classes of
goods or inputs derived from such process.

Deutsche Giessdraht GmbH

As of December 31, 2017, the balance of this investment is classified under Non-current assets or
groups of assets for disposition classified as held for sale Note 7, of the consolidated current assets,
and corresponds in ¡ts entirety to the participation held by the Corporation at that date through its
affiliate Codelco Kupferhandel GmbH, having a 40% interest in the capital of the company Deutsche
Giessdraht GmbH.

On July 31, 2018 the share sale agreement was finalized representative of the shareholding held by
CK in Deutsche Giessdraht GmbH. The acquiring company of the shares was the Aurubis Company
AG, which was, until before the sale transaction, the majority shareholder of DG.

The result after taxes of this transaction was a net income Th€ 15,214 (ThUS $ 18,172).
Anglo American Sur S.A.

As December 31, 2018, the controlling shareholder of Anglo American Sur S.A. is Inversiones Anglo
American Sur S.A. holding a 50.06% ownership interest, while the non-controlling interest is held by
Inversiones Mineras Becrux SpA., which in turn is a subsidiary controlled by Codelco with a 67.8%
ownership interest. Consequently, Codelco exercises significant influence in Anglo American Sur S.A.
through its indirect ownership interest of 29.5%.

On December 21, 2017, according to archive No. 12285 / 2017, by public deed, it was agreed between
the shareholders to merge the Acrux SpA Mining Investment Company (“Absorbed Company”) into the
Investment Company Minera Becrux SpA (“Absorbing Company”), which took effect as of December
22, 2017, where the Absorbing Company acquires all the assets and liabilities of the Absorbed

60
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Company, which would be dissolved without the need for its liquidation. In addition the Absorbing
Company ¡is responsible for the payment of all taxes owed or which may be owed by the Absorbed
Company.

The principal activities of the Company are the exploration, extraction, exploitation, production,
processing and trading of minerals, concentrates, precipitates, copper bars and all metallic and non-
metallic minerals, all fossil substances and liquid and gaseous hydrocarbons. This includes the
exploration, exploitation and use of all natural energy sources capable of industrial use and the
products or by-products obtained, as well as any other related, connected or complementary activities
on which the shareholders agree.

The following tables provide details of asset and liabilities of the associates as of December 31, 2018
and 2017, and their profit (loss) for the years ended December 31, 2018 and 2017:

Assets and Liabilities 12/31/2018 1213112017
TRUS$ TRUS$
Current Assets 1,805,003 1,595,687
Non-current Assets 5,637,321 5,925,176
Current Liabilities 1,008,086 766,986
Non-current Liabilities 1,699,529 1,724,512
1/1/2018 1/1/2017
Net Income 12/31/2018 12/31/2017
TRUS$ TRUS$
Revenue 3,256,402 2,766,212
Cost of sales (2,665,805) (2,359,555)
Profit for the period 590,597 406,657
Movements of Investment in Associates 1/1/2018 1/1/2017
12/31/2018 12/31/2017
TRUS$ TRUS$
Opening balances 3,665,601 3,753,974
Capital contribution 338
Dividends (213,172) (273,560)
Result of the period 119,114 118,151
Foreign exchange differences – (59)
Reverse/ Impairment Anglo American Sur S.A. – 67,277
Other comprehensive income (710) (4,236)
Other (2,878) 4,591
Final balance 3,568,293 3,665,601

61
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The following tables provide details of asset and liabilities of the principal associates as of December 31,
2018 and 2017, and their profit (loss) for the periods ended December 31, 2018 and 2017:

Anglo American Sur S.A.
Assets and liabilities 12/31/2018 12/31/2017
ThUS$ ThUS$
Current Assets 1,164,724 1,055,740
Non-current Assets 4,104,271 4,265,685
Current Liabilities 890,874 635,033
Non-current Liabilities 1,226,503 1,209,904

See note 20. Letter b) participation non-controlling note

1/1/2018 1/1/2017
Net Income 12/31/2018 12/31/2017
ThUS$ ThUS$
Revenue 2,543,730 2,152,324
Costof sales (2,158,834) (1,790,407)
Profit for the period 384,896 361,917

Sociedad Contractual Minera El Abra

rs 12/31/2018 12/31/2017
Assets and liabilities ThUS$ ThUS$
Current Assets 576,167 477,857
Non-current Assets 1,013,165| 1,110,167
Current Liabilities 73,458| 80,077
Non-current Liabilities 270,283 271,684
1/1/2018 1/1/2017
Net Income 12/31/2018 12/31/2017
ThUS$ ThUS$
Revenue 596,060 501,073
Costof sales (575,283) (469,761)
Profit (loss) for the period 20,777 31,312

b) Additional information on unrealized profits (losses)

Codelco enters into transactions for the purchase and sale of copper with Sociedad Contractual Minera
El Abra. As of December 31, 2018 and 2017, there were no unrealized profits (losses) recognized in
the carrying amount of inventories of finished products.

Codelco enters into transactions for the purchase and sale of copper with Anglo American Sur S.A. As

of December 31, 2018 and 2017, there were no unrealized profits (losses) recognized in the carrying
amount of inventories of finished products.

62
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

d)

For the year ended December 31, 2018, the Corporation has recognized unrealized profits of
ThUS$3,920 (ThUS$3,920 as of December 31, 2017) for the service transaction related to the use of
the LNG terminal of the associate Contractual Minera El Abra.

Investments in associates acquired

On August 24, 2012, Codelco recognized the acquisition of ownership interest in Anglo American Sur
S.A. which resulted in the initial recognition of the cost of the investment for ThUS$6,490,000 that
corresponded to the proportionate share (29.5%) of the net fair value of the identifiable assets and
liabilities acquired.

In determining the share of the fair value of the identifiable assets and liabilities acquired, the
Corporation considered the resources and mineral reserves that could be measured reliably and the
assessment of intangibles and all other considerations about contingent assets and liabilities.

The allocation of the purchase price at fair value between the identifiable assets and liabilities was
prepared by management using its best estimate and taking into account all relevant and available
information at the acquisition date of Anglo American Sur S.A.

The acquisition did not result in obtaining control of the acquired company.

The Corporation used a discounted cash flows model to estimate cash flow projections, based on the
life of mine. These projections were based on estimated production and future prices of minerals,
operating costs and capital costs, among other estimates made at the date of acquisition. Additionally,
proven and probable resources to explore were not included in the mine plan, therefore, they were
valued separately using a market model. Such resources are included in item “Mineral Resources.”

As part of this process and by applying the valuation criteria indicated above, the fair value of the net
assets of Anglo American Sur S.A. was US$22,646 million, therefore the proportionate share acquired
by Inversiones Mineras Becrux SpA (29.5%) was equivalent to US$6,681 million at the acquisition date.

Additional information on impairment of investments accounted for using the equity method

As of December 31, 2015, the Corporation identified indicators of impairment in the operating units of
Anglo American Sur S.A. Consequently, and with the purpose of making the corresponding
adjustments to the investment in this associate, the Corporation estimated its recoverable amount.

In determining the recoverable amount, the Corporation applied the methodology of fair value less
costs of disposal. The recoverable amount of the operating units was determined based on the life of
mine by using a discounted cash flow model whose main assumptions included ore reserves declared
by the associate, copper price, supply costs, foreign exchange rates, discount rate and market
information for the long-term asset valuation. The discount rate used was annual rate of 8% after taxes.

63
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Furthermore, the proven reserves not included in the LOM, as well as the probable reserves to explore,
have been valued using a multiples market approach for comparable transactions. Such methodology
is consistent with the methodologies used at the acquisition date, which is described in letter c) above.

The recoverable amount as estimated was less than the carrying amount of the identified assets of the
associate, therefore, the Corporation recognized an impairment loss of ThUS$2,439,495, which was
included within the line item “Share of profit or loss of associates and joint ventures accounted for using
the equity method” in the consolidated statements of comprehensive income for the year ended
December 31, 2015.

The impairment loss was mainly attributable to the drop in copper prices during the year 2015.

Subsequent to recognition of the impairment, there has been no indicators requiring the recognition of
further impairment losses on the recoverable amount of the investment held in Anglo American Sur
S.A.

As of December 31, 2016, the parent company of Anglo American Sur S.A. reviewed the discounted
cash flow model of its cash generating units (CGU), determining an impairment loss for the El Soldado
CGU of US$200 million due to the uncertainty related to obtaining the required approval of its
operational plan from the National Mining and Geology Service (“SERNAGEOMIN” in its Spanish
acronym), which raised questions about the generation of future economic benefits to support the value
of the assets related to such CGU.

Consequently, and with the purpose of making the corresponding adjustments to the recognition its
investment in the associate, the Corporation estimated its recoverable amount by considering the fair
value of the identified net assets of the associate El Soldado. The recoverable amount as estimated
was less than the carrying amount of the identified assets of the associate, therefore, the Corporation
recognized an impairment loss of ThUS$78,811 over the identified assets related to El Soldado
operations, which was included within the line item “Share of profit or loss of associates and joint
ventures accounted for using the equity method” in the statement of comprehensive income for the
year ended December 31, 2016.

On April 27, 2017, the SERNAGEOMIN approved the updated mine plan for El Soldado, based on this
resolution Anglo American Sur S.A. has resumed the operations of the mine. Consequently, the
company recognized a reversal of an impairment loss for US$193 million.

As of December 31, 2017, Codelco made a corresponding adjustment to the identified assets at the
acquisition date of the investment associated with El Soldado operations by recognizing a reversal of
an impairment loss of ThUS$67,277, which is presented in the line item “Share of profit or loss of
associates and joint ventures accounted for using the equity method.”

As of December 31, 2018, there are no indicators of impairment, therefore, there have been no
adjustments recognized to the carrying amounts of the assets.

64
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

e) Share of profit or loss for the year

The share in profit or loss of the associate Anglo American Sur S.A. recognized for the year ended
December 31, 2018 was income of ThUS$113,544 (income of ThUS$106,766 for the year ended
December 31, 2017). In addition, the Corporation has made appropriate adjustments to its share of
profit or loss in the associate for depreciation of the depreciable assets based on the fair values at the
acquisition date, which resulted in an expense of ThUS$13,835 for the year ended December 31, 2018
(an expense of ThUS$10,268 for the year ended December 31, 2017) recognized within line item
“Share of profit or loss of associates and joint ventures accounted using the equity method” in the
consolidated statements of comprehensive income.

10. Intangible assets other than goodwill
As of December 31, 2018 and 2017, the intangible assets other than goodwill are described as follows:

a) This item is composed of the following:

ltem 12/31/2018 12/31/2017
ThUuS$ ThUuS$
Intangible assets with finite useful lives, net 40,421 35,449
Intangible assets with indefinite useful lives 7,958 183,668
Total 48,379 219,117
b) Carrying amount and accumulated amortization:
12/31/2018
Accumulated
Gross o Net
Item Amortization
TRUS$ TRUS$ THUS$
Trademarks, patents and licenses 28 – 28
Water rights 7,958 – 7,958
Sofware 2,803 (1,351) 1,452
Other intangible assets 38,950 (9) 38,941
Total 49,739 (1,360) 48,379

65
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

12/31/2017
Accumulated
Gross o Net
Item Amortization
ThUS$ ThUS$ TRUS$
Trademarks, patents and licenses 28 – 28
Water rights 7,959 – 7,959
Sofware 5,226 (3,533) 1,693
Technological development and innovation 175,710 – 175,710
Other intangible assets 33,727 – 33,727
Total 222,650 (3,533) 219,117

c) Reconciliation of the carrying amount at beginning and end of the period:

Trademarks, Technological
Movements patents and — | Water rights | Software | developmentand | Other Total
licenses innovation
Reconciliation of changes in intangible assets other than goodwill
Intangible assets other than goodwill. Opening balance (1/1/2018) 2 7,959 1,693 1758,710| 33,727 219,117
Changes in intangible assets other than goodwill
Increases other than those arising from business combinations, intangible assets other than goodwil – – 586 704 9,261 10,561
‘Amortization, intangible assets other than goodwil – – (603) – (852) (855)
Increases (decreases) in transfers and other changes, intangible assets other than goodwill
Ihcreases (decreases) in transfers and other changes, intangible assets other than goodwil – – – (103,638) – (103,638)
Increases (decreases) due to other changes, intangible assets other than goodwil – (0) (149) – 7) (157)
Increase (decrease) in transfers and other changes, intangible assets other than goodwill – (1 (149) (103,638) (MÍ (103,795)
Provisions and withdrawals of service, intangible assets other than goodwill
Service retirements / retirements, intangible assets other than goodwill – – (175) (72,776) (3,688) (76,639)
Provisions and withdrawals of service, intangible assets other than goodwill – – (475) (72,776) (3,688) (76,639)
Increase (decrease) in intangible assets other than goodwill – 4) (241) (475,710)| 5214] (170,738)
Intangible assets other than goodwill. Final Balance 12/31/2018 2 7,958 1,452 -| 38,941 48,379
Trademarks, Technological
Movements patents and — | Water rights | Software | developmentand | Other Total
licenses innovation
Reconciliation of changes in intangible assets other than goodwill
Intangible assets other than goodwil. Opening balance (1/1/2017) 2 7,959 1,905 174,624 12,381 196,897
Changes in intangible assets other than goodwill
Ihcreases other than those arising from business combinations, intangible assets other than goodwil – – 87 1,086 4 1,177
‘Amortization, intangible assets other than goodwill – – (430) – (852) (782)
Increases (decreases) in transfers and other changes, intangible assets other than goodwill
Increase (decrease) in transfers and other changes, intangible assets other than goodwill – – 22,869 22,869
Increases (decreases) due to other changes, intangible assets other than goodwil – – 132 – (62) 80
Increase (decrease) in transfers and other changes, intangible assets other than goodwill – – 132 | 2817 22,949
Provisions and withdrawals of service, intangible assets other than goodwill –
Retirements from service, intangible assets other than goodwil – – 0) – (1,123) (1,124)
Disposiciones y retiros de servicio, activos intangibles distintos de la plusvalía – – (1) 1 (4,123) (1,124)]
Increase (decrease) in intangible assets other than goodwill – – (212) 1,086 | 21,346 22,220
Intangible assets other than goodwill. Final Balance 12/31/2017 2 7,959 1.693 175,0] 33,727 219,117

d) Additional Information

As of December 31, 2018, the Corporation does not hold balances for intangible assets corresponding
to technological development and innovation. The Corporation has significant intangible assets for
ThUS$175,710, as of December 31, 2017, related to the “Continuous Mining” Project.

Continuous Mining is a project of the Corporation aimed toward development of an internal

technological breakthrough associated with the exploitation of underground mines, the main
Characteristics of the project are: (1) reduction in the exposure of workers to mineral extraction areas;

66
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

(2) increasing the pace of mineral extraction; and (3) simultaneous mineral extraction from different
sections.

This project began in 2005, when the first conceptual tests were made, and in 2007 and 2008 it was
applied at the pilot level and from 2009 the basic and detailed engineering and the construction phase
for industrial validation at the West sector of third panel of Andina Division were performed, which was
expected to be carried out through 2018. It was expected that its subsequent implementation would be
at Chuquicamata Underground and of the new mining projects of Codelco. During the 2018 period,
project studies were carried out and Management has decided not to continue with it.

In view of the discontinuance of the project during the first quarter of 2018, a write-off of US$71.7 million
before tax (US$25 million after taxes) associated with basic engineering, construction and equipment
was recognized in profit or loss. In addition, US$103.6 million were reclassified to Property, plant and
equipment in relation to those assets that might potentially be used in other operations and / or projects
of the Corporation. As a result of a subsequent review, an additional write-off for US$66.4 million (see
note 8 Property, plant and equipment) of assets was recognized. Consequently, the total write-offs as
of December 31, 2018, related to this project is US$138.1 million (US$48 million after taxes).

As of December 31, 2018 and 2017, there are no fully amortized intangible assets that are still in use.
For the years ended December 31, 2018 and 2017, research and technological development and
innovation expenditures recognized in assets were ThUS$6,816 and ThUS$6,884, respectively. On
the other hand, research recognized in expense was ThUS$10,042 and ThUS$13,552 for the years
ended December 31, 2018 and 2017, respectively.

11. Subsidiaries

The following tables set forth a detail of assets, liabilities and profit (loss) of the Corporation’s subsidiaries,
prior to consolidation adjustments:

eres 12/31/2018 12/31/2017
Assets and liabilities ThUS$ ThUS$
Current assets 621,753 596,285
Non Current Assets 3,605,801 3,743,260
Current Liabilities 305,030 307,223
Non Current Liabilities 1,122,471 1,321,709
1/1/2018 1/1/2017
Profit (loss) 12/31/2018 9/30/2017
ThUS$ ThUS$
Ordinary Income 2,119,617 2,134,080
Ordinary Expenses (2,071,713) (2,017,464)
Profit (loss) of period 47,904 116,616

67
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

12. Other non-current non-financial assets

Other non-current non-financial assets as of December 31, 2018 and 2017, are as follows:

Other non-current non-financial assets 12/31/2018 12/31/2017
Thus$ ThUs$
Advance payment (Law No.13196) (1) 4,433 6,266
Other 2,384 5,309
Total 6,817 11,575

(1) Corresponds to the record of the commitment related to Law No. 13196 to the advance payment
received for the copper sales contract signed with Copper Partners Investment Company Limited.
This amount will be amortized according to the shipments made.
13. Current and non-current financial assets

Current and non-current financial assets included in the statement of financial position are as follows:

12/31/2018
Atfair value though prof Amortized Cost Derivatives for hedging Total financial
and loss assets
Classification in the statement of financial position Cross currency
Hedging derivatives swap

Thus$ Thus$ Thus$ Thus$ ThUS$
Cash and cash equivalents 1,698 1,227,427 – – 1,229,125
Trade and other current receivables 789,710 1,422,499 – – 2,212,209
Non – current receivables – 84,731 – – 84,731
Current receivables from related parties – 92,365 – – 92,365
Non – current receivables from related parties – 20,530 – 20,530
Other current financial assets – 187,870 43,539 – 231,409
Other non – current financial assets – 23,089 14,962 107,700 145,751
TOTAL 791,408 3,058,511 58,501 107,700 4,016,120

12/31/2017
Atfair value though prof Amortized Cost Derivatives for hedging Total financial
and loss assets
Classification in the statement of financial position Cross currency
Hedging derivatives swap

Thus$ Thus$ Thus$ Thus$ ThUS$
Cash and cash equivalents 651 1,448,184 – – 1,448,835
Trade and other current receivables 244,265 2,571,087 – – 2,815,352
Non – current receivables – 91,442 – – 91,442
Current receivables from related parties – 64,344 – – 64,344
Non – current receivables from related parties – 25,830 – – 25,830
Other current financial assets – 1,327 – – 1,327
Other non – current financial assets – 11,127 855 137,544 149,526
TOTAL 244,916 4,213,341 855 137,544 4,596,656

+» Fair value through profit or loss: As of December 31, 2018, this category mainly includes receivables
from provisional invoicing sales. Section 11.2.r.

» Amortized cost: lt corresponds to financial assets held within a business model whose objective is to

hold financial assets to collect contractual cash flows that are solely payments of principal and interest
on the principal outstanding. These assets are not quoted in an active market.

68

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The effects on profit or loss recognized for these assets are mainly from financial income and exchange
differences from balances denominated in currencies other than the functional currency.

No material impairments were recognized in trade and other receivables.

e Derivatives for Hedging: Corresponds to the balance for changes in the fair value of derivative
contracts to cover existing transactions (cash flow hedges) and that affect the profit or loss when
transactions are settled or when, to the extent required by accounting standards, a compensation effect
is charged (credited) to the income statement. The detail of derivative hedging transactions is included
in the Note 30.

As of December 31, 2018 and 2017, there were no reclassifications between the different categories of
financial instruments, under the accounting standards at the respective dates.

14. Interest-bearing borrowings
Current and non-current interest-bearing borrowings consists of loans from financial institutions, bond
issuance obligations and finance leases, which are measured at amortized cost using the effective interest

rate method.

The following tables set forth other current/non-current financial liabilities as of December 31, 2018 and
2017:

12/31/2018
Current Non-current
Items Amortized Cost Hedging Amortized Cost Hedging
derivatives Total derivatives Total
ThUus$ Thus$ Thus$ ThUs$ Thus$ Thus$
Loans from financial institutions 404,871 – 404,871 2,107,078 – 2,107,078
Bonds issued 435,429 – 435,429 12,310,307 – 12,310,307
Financial Lease 21,510 – 21,510 86,329 – 86,329
Hedging derivatives – 10,096 10,096 – 106,824 106,824
Other financial liabilities 371 – 371 63,972 – 63,972
Total 862,181 10,096 872,277 14,567,686 106,824 14,674,510
12/31/2017
Current Non-current
ltems Loans and other Hedging Loans and other Hedging
payables derivatives Total payables derivatives Total
ThUus$ Thus$ Thus$ ThUs$ Thus$ Thus$
Loans from financial institutions 130,727 – 130,727 2,329,657 – 2,329,657
Bonds issued 165,784 – 165,784 12,083,622 – 12,083,622
Financial Lease 16,364 – 16,364 86,347 – 86,347
Hedging derivatives – 10,526 10,526 – 79,552 79,552
Other financial liabilities 987 – 987 68,826 – 68,826
Total 313,862 10,526 324,388 14,568,452 79,552 14,648,004

69
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Loans from financial institutions:

The loans obtained by the Corporation aim to finance production operations oriented towards the foreign
market.

On August 23, 2012, the subsidiary Inversiones Gacrux SpA (Gacrux) signed a credit agreement with
Oriente Copper Netherlands BV (a subsidiary of Mitsui 8, Co, Ltd, (“Mitsui”)) for approximately US$1,863
million, renewable monthly until November 26, 2012, after which, if not paid or renegotiated, will
automatically become a loan with a 7.5 year maturity from the date of disbursement, and an annual rate
Libor + 2.5%. This loan has no underlying guarantees given by Codelco.

The proceeds from the loan were used by Codelco’s indirect subsidiary Inversiones Mineras Becrux SpA
to acquire 24.5% of the shares of Anglo American Sur S.A., including other acquisition-related expenses.
On October 31, 2012, the credit agreement was amended, the new terms established an annual fixed
interest rate of 3.25% and a 20-year maturity, to be paid in 40 semi-annual installments of principal and
interest, and maintaining the “non-recourse” (no underlying guarantee) condition. Under previous
agreements, Mitsui is entitled to an additional interest equivalent to one-third of the savings obtained by
Gacrux under the renegotiated credit as compared to the conditions from the credit agreement originally
signed. Thus, Mitsui (through its subsidiary) held an option to acquire from Gacrux an additional 15.25%
of the shares of Inversiones Mineras Acrux SpA (“Acrux”), at a fixed price of approximately US$998
million. These funds were fully allocated to a portion of Gacrux’s debt under the Credit Agreement.

On November 26, 2012, Mitsui exercised the call option and acquired the additional ownership interest
in Acrux. The proceeds received were used by Codelco to partially pre-pay the debt with Mitsui.

On November 26, 2016, Codelco signed a credit agreement with Oriente Copper Netherlands BV
renegotiating the payment of principal at the end of the contract. The terms established an annual interest
rate of Libor +2.5% with a 5 year maturity to be payable in one installment at maturity with semi-annual
interest payment.

On May 26, 2017, Codelco signed a credit agreement with Oriente Copper Netherlands BV renegotiating
the semi-annual payment. The terms established an annual interest rate of Libor +2.5% with a 5 year
maturity to be payable in one installment at maturity with semi-annual interest payment.

The credit agreements obtained in 2016 and 2017, mentioned above, were paid on May 23, 2018.

As of December 31, 2018, the outstanding balance of the credit agreements is ThUS$631,357.

Bond issued:

On May 10, 2005, the Corporation issued and placed bonds in the domestic market for a nominal amount
of UF 6,900,000 of a single series labeled “Series B”, which consists of 6,900 bonds for UF 1,000 each.

These bonds are payable in a single installment on April 1, 2025, at an annual interest rate of 4% and
semi-annual interest payments.

70
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

On September 21, 2005, the Corporation issued and placed bonds in the U.S. market under Rule 144-
A and Regulation S, for a nominal amount of ThUS$500,000. These bonds are payable in a single
installment on September 21, 2035, at an annual interest rate of 5.6250% and semi-annual interest
payments.

On October 19, 2006, the Corporation issued and placed bonds in the U.S. market under Rule 144-A
and Regulation S, for a nominal amount of ThUS$500,000. These bonds are payable in a single
installment on October 24, 2036, at an annual interest rate of 6.15% and semi-annual interest payments.

On January 20, 2009, the Corporation issued and placed bonds in the U.S. market under Rule 144-A
and Regulation S, for a nominal amount of ThUS$600,000. These bonds are payable in a single
installment on January 15, 2019, at an annual interest rate of 7.5% and semi-annual interest payments.
On August 3, 2017, principal was paid for an amount of ThUS$333,155.

On November 4, 2010, the Corporation issued and placed bonds in the U.S. market under Rule 144-A
and Regulation S, for a nominal amount of ThUS$1,000,000. These bonds are payable in a single
installment on November 4, 2020, atan annual interest rate of 3.75% and semi-annual interest payments.
On August 3, 2017, principal was paid for an amount of ThUS$414,763.

On November 3, 2011, the Corporation issued and placed bonds in the U.S. market under Rule 144-
A and Regulation S, for a nominal amount of ThUS$1,150,000. These bonds are payable in a single
installment on November 4, 2021, atan annual interest rate of 3.875% and semi-annual interest
payments. On August 3, 2017, principal was paid for an amount of ThUS$665,226.

On July 17, 2012, the Company issued and placed bonds in the U.S. market under Rule 144-A and
Regulation S, for a nominal amount of ThUS$2,000,000. These bonds are payable in two installments
() Thus$1,250,000 at an annual interest rate of 3%, On August 22, 2017, principal was paid for an
amount of ThUS$412,514, with maturity on July 17, 2022, and (ii) TRUS$750,000 at an annual interest
rate of 4.25% with maturity on July 17, 2042, and each have annual interest payments.

On August 13, 2013, the Corporation issued and placed bonds in the U.S. market, under Rule 144-A
and Regulation S, for a nominal amount of ThUS$750,000, payable in a single installment on August 13,
2023, at an annual interest rate of 4.5% and semi-annual interest payments. On August 22, 2017,
principal was paid for an amount of ThUS$162,502.

On October 18, 2013, the Corporation issued and placed bonds in the U.S. market, under Rule 144-A
and Regulation S, for a nominal amount of ThUS$950,000, payable in a single installment on October
18, 2043, at an annual interest rate of 5.625% and semi-annual interest payments.

On July 9, 2014, the Corporation issued and placed bonds in the international financial markets, under
Rule 144-A and Regulation S, for a nominal amount of EUR$600,000,000, payable in a single installment
on July 9, 2024, at an annual interest rate of 2.25% and semi-annual interest payments.

On November 4, 2014, the Corporation issued and placed bonds in the U.S. market, under Rule 144-A

and Regulation S, for a nominal amount of ThUS$980,000, payable in a single installment on November
4, 2044, at an annual interest rate of 4.875% and semi-annual interest payments.

71
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

On September 16, 2015, the Corporation issued and placed bonds in the U.S. market, under Rule 144-
A and Regulation S, for a nominal amount of ThUS$2,000,000, payable in a single installment on
September 16, 2025, at an annual interest rate of 4.5% and semi-annual interest payments. On August
22, 2017, principal was paid for an amount of ThUS$378,655.

On August 24, 2016, the Corporation issued and placed bonds in the local market for a nominal amount
of UF10,000,000 of single series labeled “Series C”, which consists of 20,000 bonds for UF500 each.
These bonds are payable in a single installment on August 24, 2026, at an annual interest rate of 2.5%
and semi-annual interest payments.

On August 1, 2017, the Corporation issued and placed bonds on the North American market, under
standard 144-A and Regulation S, for a total, nominal, amount of ThUS$2,750,000. ThUS$1,500,000,
with an annual coupon rate of interest of 3.625% and semi-annual interest payments, will mature on
August 1, 2027, while ThUS$1,250,000, with an annual coupon of 4.5% and semi-annual interest
payments, which will mature on August 1, 2047.

These operations allowed optimizing the debt maturity profile of Codelco. As a result of these
transactions, 86% of the funds from the new issue (US$2,367 million) were used to refinance old debt.
The average interest rate of refinanced funds decreased from 4.36% to 4.02%.

The effect recognized in profit and loss associated with this refinancing was a charge of US$ 42 million
after tax.

On May 18, 2018, Codelco issued a bond for US$600 million with 30 year maturity in the market of
Formosa, Taiwan. The bond issued is denominated in US dollars, had a yield of 4.85% and a prepayment
option at the issue value that can be exercised from the fifth year onwards at its par value.

As of December 31, 2018 and 2017, the Corporation is not required to comply with any financial
covenants related to borrowings from financial institutions and bond obligations.

– Financial debt commissions and expenses:

Transaction costs incurred in obtaining financial resources are deducted from the loan proceeds and are
amortized using the effective interest rate.

– Finance leases:

Finance lease contracts mainly corresponds to buildings and machinery.

72
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

As of December 31, 2018, the details of loans from financial institutions and bond obligations are as follows:

12/34/2018
. Principal Nominal | Effective | Current [ Non-current
Taxpayer ID Loans with a . Interest _ Payment of
Country Institución Maturity Currency| Amount Type of amortization Interest | Interest | balance | balance
Number financial entities Rate Interest
Rate Rate Thus$ Thus$
97.018.000-1 [Chile Scotiabank Chile 12/20/2019 3,60% | 3,74% 300,059 –
Bilateral Credit Floating | US$ 300,000,000| Maturity Semi-annual
Foreign [USA Bilateral Credit — [Bank of Tokyo Mitsubishi Ltd. 9/30/2021] Floating | US$ 250,000,000| Maturiy Semizannual | 3.27% | 3.37% 3,768 249,579
Foreign [USA Bilateral Credit — [Export Dev Canada 11/3/2021 | Floaing | US$ 300,000,000| Maturity Semizannual | 3.44% | 3.62% 1,604 298,875
Foreign [Cayman Island | Bilateral Credit — [Scotiabank 8: Trust (Cayman) Ltd 4/13/2022| Floaing | US$ 300,000,000| Maturity Quarterly 3.09% | 3.30% 1,980 298,401
Foreign [USA Bilateral Credit — [Export Dev Canada 7/7/2022] Floating | US$ 300,000,000| Maturity Semizannual | 3.38% | 3.48% 1,915 299,432
Foreign [USA Bilateral Credit — [Export Dev Canada 10/25/2019| Floaing | US$ 300,000,000| Maturity Semizannual | 3.96% | 4.09% 2,212 298,250
Foreign [Japan Bilateral Credit — [Bank of Tokyo-Mitsubishi Ltd 5/24/2029] Floating | US$ 96,000,000| Halfyearly principal payments from 2015 to the present | Semizannual | 3.44% | 3.84% 12,016 –
Foreign [Japan Bilateral Credit — [Japan Bank International Cooperation 5/24/2022] Floating | US$ 224,000,000| Halfyearly principal payments from 2015 to the present | Semizannual | 3.34% | 3.54% 32,363 79,674
Foreign [Holland Credit Oriente Copper Netherlands B.V. 11/26/2032| — Fixed US$ 874,959| Semi-annual Semizannual | 3.25% | 5.42% 48,490 582,867
Foreign [Germany creditline HSBC Trinkaus 8 Floating | Euro 1.25% | 1.25% 408 –
other institutions 56 –
TOTAL 404,871] 2,107,078
Taxpayer merest Principal Nominal | Effective Current Non-current
DD Number Country Maturity Rat Currency Amount Type of amortization Pay mentofinterest | Interest | Interest balance balance
Rate Rate ThUS$ ThUS$
144-A REG.S Luxembourg 1/15/2019| — Fixed US$ 600,000,000 At Maturity Semizannual 7.50% 7.78% 276,061 –
144-A REG.S Luxembourg 11/4/2020| — Fixed US$ 1,000,000,000 At Maturity Semi-annual 3.75% 3.97% 3,456 582,989
144-A REG.S Luxembourg 11/4/2021] — Fixed US$ 1,150,000,000 At Maturity Semi-annual 3.88%| 4.06% 2,958 482,430
144-A REG.S Luxembourg 7/17/2022] — Fixed US$ 1,250,000,000 At Maturity Semi-annual 3.00% 3.17% 11,538 832,748
144-A REG.S Luxembourg 8/13/2023] — Fixed US$ 750,000,000 At Maturity Semi-annual 4.50%| 4.75% 10,058 581,548
144-A REG.S Luxembourg 9/07/2024] — Fixed EUR 600,000,000 At Maturity Annual 2.25% 2.48% 7,404 678,446
BCODE-B Chile 4/1/2025] — Fixed UR. 6,900,000 At Maturity Semi-annual 4.00% 3.24% 2,737 285,436
144-A REG.S Luxembourg 9/16/2025] — Fixed US$ 2,000,000,000 At Maturity Semi-annual 4.50%| 4.77% 21,364 1,596,926
BCODE-C Chile 8/24/2026] — Fixed UR. 10,000,000 At Maturity Semi-annual 2.50% 2.48% 3,455 416,715
144-A REG.S Luxembourg 8/112027| — Fixed US$ 1,500,000,000 At Maturity Semi-annual 3.63%| 4.20% 22,607 1,437,938
144-A REG.S Luxembourg 9/21/2035] — Fixed US$ 500,000,000 At Maturity Semi-annual 5.63% 5.78% 7,925 491,814
144-A REG.S Luxembourg 10/24/2036| — Fixed US$ 500,000,000 At Maturity Semi-annual 6.15% 6.22% 5,998 496,430
144-A REG.S Luxembourg 7/17/2042| — Fixed US$ 750,000,000 At Maturity Semi-annual 4.25%| 4.41% 14,638 733,027
144-A REG.S Luxembourg 10/18/2043| — Fixed US$ 950,000,000 At Maturity Semi-annual 5.63% 5.76% 10,864 933,256
144-A REG.S Luxembourg 4111/2044] — Fixed US$ 980,000,000 At Maturity Semi-annual 4.88% 5.01% 7,522 961,050
144-A REG.S Luxembourg 1/8/2047| — Fixed US$ 1,250,000,000 At Maturity Semi-annual 4.50%| 4.73% 23,387 1,205,156
144 – REG S Luxembourg 5/18/2048] _ Fixed US$ 600,000,000 At Maturity Semi-annual 4.85%| 4.91% 3,457 594,398
TOTAL 435,429] 12,310,307

Nominal and effective interest rates presented above correspond to annual rates.

73
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

As of December 31, 2017, the details of loans from financial institutions and bond obligations are as follows:

12/31/2017
si s Principal Nominal a Current — | NonForeign USA Bilateral Credit Bank of Tokyo Mitsubishi Ltd. 9/30/2021| — Floating US$ 250,000,000| Maturity Quarterly 2.10% 2.16% 1,081 249,483|
Foreign USA Bilateral Credit Export Dev Canada 11/3/2021] Floating US$ 300,000,000| Maturity Quarterly 2.00% 2.17% 969| 298,480]
Foreign Cayman Island | Bilateral Credit — [Scotiabank 8 Trust (Cayman) Ltd 4/18/2022| – Floating US$ 300,000,000| Maturity Quarterly 2.01% 2.20% 1,323 297,935
Foreign [USA Bilateral Credit — [ExportDev Canada 7/17/2022] Floating US$ 300,000,000| Maturity Quartery 2.01% 2.09% 1,142 299,253]
Foreign USA Bilateral Credit Mizuho Corporate Bank Ltd 6/5/2019] — Floating US$ 95,000,000| Maturity Quarterly 2.14% 2.35% 130) 94,740]
Foreign USA Bilateral Credit Export Dev Canada 6/16/2019] — Floating US$ 300,000,000| Maturity Quarterly 1.97% 2.03% 1,346| 299,480]
Foreign ¡Japan Bilateral Credit — [Bank of Tokyo Mitsubishi Ltd. 5/24/2019| – Floating US$ 96,000,000| Halfyeariy principal payments from 2015 to the present. Semi-annual 2.20% 2.60% 24,081 11,883]
Foreign Japan Bilateral Credit — [Japan Bank Intemational Cooperation 5/24/2022 – Floating US$ 224,000,000| Halfyeariy principal payments from 2015 to the present. Semi-annual 2.10% 2.29% 32,311 111,478]
Foreign Holland Bilateral Credit [Oriente Copper Netherlands B.V’ 11/26/2032] — Fixed US$ 874,959,000| At maturity with semi-annual interest payments Semi-annual 3.25% 5.37% 43,748| 626,357|
Foreign Holland Bilateral Credit [Oriente Copper Netherlands B.V’ 11/26/2021 Fixed US$ 23,946,863| At maturity with semi-annual interest payments Semi-annual 3.79% 4.02% 24,044]
Foreign Holland Bilateral Credit [Oriente Copper Netherlands B.V’ 5/26/2022| Fixed US$ 16,395,765| At maturity with semi-annual interest payments Semi-annual 3.92% 3.98% 16,460]
Foreign [Germany Credit Line HSBC Trinkaus 8 Floating Euro 1.24% 1.24% 17,045] –
Foreign [Germany Credit Line Deutsche Bank Floating Euro 1.22% 1,22% 7,355 –
[other institutions 196 64
TOTAL 130,727] 2,329,657]

Principal . Non-current

CA Country Maturity Interest Rate Currency Amount Type of amortization Payment of interest a. MA Current balance balance
Thus$ THUs$

144-A REG.S Luxembourg 1/15/2019) Fixed US$ 600,000,000| Maturity Semi-annual 7.50% 7.78% 9,162] 266,111
144-A REG.S Luxembourg 4/11/2020 Fixed US$ 1,000,000,000) Maturity Semi-annual 3.75% 3.97% 3,456| 581,833
144-A REG.S Luxembourg 4/11/2021 Fixed US$ 1,150,000,000 Maturity Semi-annual 3.88% 4.06% 2,993| 481,661
144-A REG.S Luxembourg 7/17/2022 Fixed US$ 1,250,000,000 Maturity Semi-annual 3.00% 3.17% 11,385| 831,500
144-A REG.S Luxembourg 8/13/2023 Fixed US$ 750,000,000| Maturity Semi-annual 4.50% 4.75% 10,058| 580,420
144-A REG.S Luxembourg 7/09/2024 Fixed EUR 600,000,000| Maturity Annual 2.25% 2.48% 7,782] 711,734
BCODE-B Chile 4/01/2025 Fixed v.F 6,900,000) Maturity Semi-annual 4.00% 3.24% 3,797| 316,327
144-A REG.S Luxembourg 9/16/2025 Fixed US$ 2,000,000,000 Maturity Semi-annual 4.50% 4.71% 21,364] 1,593,900]
BCODE-C Chile 8/24/2026 Fixed v.F 10,000,000 Maturity Semi-annual 2.50% 2.48% 3,008| 460,495|
144-A REG.S Luxembourg 8/01/2027 Fixed US$ 1,500,000,000) Maturity Semi-annual 3.63% 4.14% 22,485| 1,439,403|
144-A REG.S Luxembourg 9/21/2035 Fixed US$ 500,000,000| Maturity Semi-annual 5.63% 5.78% 7,925| 491,529]
144-A REG.S Luxembourg 10/24/2036| Fixed US$ 500,000,000| Maturity Semi-annual 6.15% 6.22% 5,998| 496,323 |
144-A REG.S Luxembourg 7/17/2042 Fixed US$ 750,000,000| Maturity Semi-annual 4.25% 4.41% 14,638| 732,623
144-A REG.S Luxembourg 10/18/2043| Fixed US$ 950,000,000| Maturity Semi-annual 5.63% 5.76% 10,950| 932,957
144-A REG.S Luxembourg 4/11/2044 Fixed US$ 980,000,000| Maturity Semi-annual 4.88% 5.01% 7,523| 960,696
144-A REG.S Luxembourg 8/01/2047 Fixed US$ 1,250,000,000) Maturity Annual 4.50% 4.72% 23,260] 1,206,110]
TOTAL 165,784] 12,083,622|

Nominal and effective interest rates presented above correspond to annual rates.

74

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The undiscounted amounts that the Corporation will have to disburse to settle the obligations with financial institutions, are as follows:

12/31/2018 Current Non-current

Creditor Name Currency e eres! noma e lerest Payments of Interest a 9 More tan so Current total 1 to 3 years 3to5 years | More than 5 years| Non-current total

Scotiabank Chile US$ 3.74%) 3.60% Semi-annual 310,893] 310,893] – – – –

Bank of Tokyo Mitsubishi Ltd. US$ 3.37% 3.27%] Semi-annual 4,176| 4,108| 8,284] 270,701 – -| 270,701
Export Dev Canada US$ 3.62% 3.44%] Semi-annual 10,395| 10,395| 320,934] – -| 320,934!
Scotiabank 8 Trust (Cayman) Ltd US$ 3.30%| 3.09% Quarterly 2,340] 7,099] 9,439] 18,801 304,578 – 323,379
Export Dev Canada US$ 3.48% 3.38%] Semi-annual – 10,279] 10,279] 20,586| 310,251 -| 330,837
Export Dev Canada US$ 4.09%] 3.96%] Semi-annual 12,053| 12,053| 24,139] 24,106| 360,330| 408,575|
Bank of Tokyo-Mitsubishi Ltd. US$ 3.84% 3.44%] Semi-annual 12,205] 12,205| – – -| –
Japan Bank International Cooperation US$ 3.54% 3.34%] Semi-annual – 35,496 35,496 67,793| 16,268| -| 84,061
BONO 144-A REG.S 2019 US$ 7.78%) 7.50%] Semi-annual 276,852 276,852 >] – – >
BONO 144-A REG.S 2020 US$ 3.97%) 3.75%] Semi-annual – 21,946 21,946 607,183 – – 607,183|
BONO 144-A REG.S 2021 US$ 4.06%] 3.88%] Semi-annual – 18,785| 18,785| 522,344] – – 522,344|
BONO 144-A REG.S 2022 US$ 3.17% 3.00%] Semi-annual 12,562] 12,562] 25,124 50,249 862,611 – 912,860|
BONO 144-A REG.S 2023 US$ 4.75%] 4.50%] Semi-annual 13,219] 13,219] 26,438 52,875 640,373 – 693,248|
BONO 144-A REG.S 2025 US$ 4.77%] 4.50%] Semi-annual 36,480 36,480 72,960 145,922] 145,922] 1,767,271| 2,059,121
BONO 144-A REG.S 2027 US$ 4,20%] 3.63%] Semi-annual 27,188 27,188 54,376 108,750] 108,750| 1,717,500] 1,935,000
BONO 144-A REG.S 2035 US$ 5.78% 5.63%] Semi-annual 14,063| 14,063| 28,126 56,250 56,250] 837,500| 950,000|
BONO 144-A REG.S 2036 US$ 6.22%] 6.15%] Semi-annual – 30,750 30,750 61,500] 61,500] 899,750] 1,022,750
BONO 144-A REG.S 2042 US$ 4.41%] 4.25%] Semi-annual 15,938| 15,938| 31,876 63,750] 63,750] 1,355,625] 1,483,125]
BONO 144-A REG.S 2043 US$ 5.76% 5.63%] Semi-annual – 53,438 53,438 106,875] 106,875| 2,018,750| 2,232,500]
BONO 144-A REG.S 2044 US$ 5.01%] 4.88%] Semi-annual – 47,775] 47,775] 95,550) 95,550] 1,983,275] 2,174,375
BONO 144-A REG.S 2047 US$ 4.73%] 4.50%] Semi-annual 28,125 28,125 56,250 112,500] 112,500] 2,600,000] 2,825,000]
BONO 144 REG.S 2048 US$ 4.91%] 4.85%] Semi-annual – 29,100 29,100 58,200 58,200] 1,312,950] 1,429,350
Oriente Copper Netherlands B.V. US$ 5.42%] 3.25%] Semi-annual 72,705 72,705 141,137] 135,320] 537,640] 814,097
Total TRUS$ 430,943 824,602| 1,255,545] 2,906,039] 3,102,804] 15,390,597| 21,399,440

BONO BCODE-B 2025 VE 3.24%] 4.00%] Semi-annual 138,000 138,000 276,000 552,000] 552,000, 7,314,000] 8,418,000]
BONO BCODE-C 2026 UE. 2.48%] 2.50%] Semi-annual 124,228 124,228 248,457 496,913 496,913 10,745,370] 11,739,197]
Total U.F. 262,228 262,228 524,457| 1,048,913| 1,048,913| 18,059,370| 20,157,197|

Subtotal TRUS$ 10,404 10,404| 20,808 41,617] 41,617] 716,526 799,760|

[BONO 144-A REG. S 2024 [ EUR 2.48%| 2.25%] Annual 13,500,000) 13,500,000) 27,000,000] 27,000,000] 613,500,000| 667,500,000,
Total EUR 13,500,000) 13,500,000) 27,000,000] 27,000,000] 613,500,000| 67,500,000,
Subtotal ThUS$ 15,443 15,443 30,885 30,885 701,783 763,553
Total TRUS$ 441,347 850,449] 1,291,796] 2,978,541 3,175,306] 16,808,906] 22,962,753|

Nominal and effective interest rates presented above correspond to annual rates.

75
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

12/31/2017 Current Non-current
Debtor’s Name Currency Efecive interest Nominal Payments of Interest Less than 90 More than 90 Current total 1 to 3 years 3 to 5 years More han 5 Non-current total
rate Rate days days years
Bank of Tokyo Mitsubishi Ltd. US$ 2.16%] 2.10%] Quarterly 1,344 3,989] 5,333 10,680| 255,070 > 265,750
Export Dev Canada US$ 2,17%] 2.00%] Quarterly 1,570] 4,561 6,131 12,213] 306,098 > 318,311
¡Scotiabank 8. Trust (Cayman) Ltd US$ 2.20%] 2.01%] Quarterly 1,590 4,553| 6,143] 12,286| 309,072 > 321,358
Export Dev Canada US$ 2.09%] 2.01%] Quarterly 1,545| 4,584| 6,129] 12,273] 310,577 > 322,850|
Mizuho Corporate Bank Ltd US$ 2.35%] 2.14%] Quarterly 509] 1,555 2,064] 96,012 – – 96,012]
Export Dev Canada US$ 2.03%] 1.97%) Quarterly 2,988| 3,005| 5,993 304,121 – > 304,121
Bank of Tokyo-Mitsubishi Ltd. US$ 2.60%] 2.20%] Semi-annual -| 24,669 24,669 12,133] – – 12,133
Japan Bank International Cooperation US$ 2.29%] 2.10%] Semi-annual -| 34,897 34,897 67,753 49,020] – 116,773
BONO 144-A REG. S 2019 US$ 7.18%] 7.50%] Semi-annual 10,007| 10,007| 20,014 276,852 – > 276,852
BONO 144-A REG. S 2020 US$ 3.97%] 3.75%] Semi-annual -| 21,946 21,946 629,130 – > 629,130
BONO 144-A REG. S 2021 US$ 4.06%] 3.88% Semi-annual -| 18,785| 18,785| 37,570 503,559 > 541,129
BONO 144-A REG. S 2022 US$ 3.17%] 3.00%] Semi-annual 12,562 12,562] 25,124 50,249] 887,735 > 937,984|
BONO 144-A REG. S 2023 US$ 4.75%] 4.50%] Semi-annual 13,219] 13,219] 26,438 52,875| 52,875] 613,935 719,685
BONO 144-A REG. S 2025 US$ 4.77%] 4.50%] Semi-annual 36,480] 72,961 109,441 145,922 145,922| 1,840,238| 2,132,082]
BONO 144-A REG. S 2027 US$ 4.14%] 3.63% Semi-annual 27,188] 27,188 54,376 108,750 108,750| 1,771,875] 1,989,375|
BONO 144-A REG. S 2035 US$ 5.18%] 5.63%] Semi-annual 14,063| 14,063| 28,126 56,250 56,250] 865,625 978,125
BONO 144-A REG. S 2036 US$ 6.22%] 6.15%] Semi-annual -| 30,750 30,750 61,500 61,500] 930,500 1,053,500
BONO 144-A REG. S 2042 US$ 4.41%] 4.25%] Semi-annual 15,938| 15,938| 31,876 63,750 63,750] 1,387,500] 1,515,000
BONO 144-A REG. S 2043 US$ 5.76%] 5.63%] Semi-annual -| 53,438 53,438 106,875] 106,875| 2,072,188| 2,285,938
BONO 144-A REG. S 2044 US$ 5.01%] 4.88%] Semi-annual -| 47,775] 47,775] 95,550 95,550] 2,031,050| 2,222,150]
BONO 144-A REG. S 2047 US$ 4.72%] 4.50%] Semi-annual 28,125] 28,125 56,250 112,500 112,500] 2,656,250| 2,881,250]
Oriente Copper Netherlands B.V. US$ 5.42%] 3.25%] Semi-annual -| 74,147 74,147 144,020 138,203| 604,579 886,802!
Oriente Copper Netherlands B.V. US$ 4.20%] 3.92%] Semi-annual -| 691 691 1,384] 17,430] – 18,814
Oriente Copper Netherlands B.V. US$ 3.92%] 3.98% Semi-annual -| 1,010 1,010 2,022] 24,956| – 26,978|
Total ThUS$ 167,128| 524,418] 691,546 2,472,670] 3,605,692] 14,773,740| 20,852,102]
BONO BCODE-B 2025 UF. 3.24%] 4.00%] Semi-annual 138,000] 138,000] 276,000 552,000] 552,000 7,590,000] 8,694,000]
BONO BCODE-C 2026 UF. 2.48%] 2.50%] Semi-annual 248,457 124,228] 372,685| 496,913 496,913| 10,993,827 11,987,654]
Total U.F. 386,457 262,228 648,685 1,048,913 1,048,913| 18,583,827 20,681,654!
Subtotal ThUS$ 16,846] 11,431 28,277 45,724| 45,724| 810,105 901,553|
BONO 144-A REG. S 2024 EUR 2.48%| 2.25%] Annual -| 13,500,000) 13,500,000, 27,000,000] 27,000,000] 627,000,000| 681,000,000
Total EUR – 13,500,000) 13,500,000 27,000,000] 27,000,000] 627,000,000| 681,000,000
Subtotal TRhUS$ -| 16,232 16,232 32,464| 32,464 753,879 818,806
Total ThUS$ 183,974 552,081 736,055| 2,550,858 | 3,683,880] 16,337,724| 22,572,461

Nominal and effective interest rates presented above correspond to annual rates.

76
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The present value of future lease payments for financial lease obligations are detailed in the following table:

12/31/2018 12/31/2017
Financial Leases Gross Interest Present Value Gross Interest Present Value
ThUS$ ThUS$ ThUS$ ThUs$ ThUS$ ThUS$

Less than 90 days 6,902 (1,735) 5,167 6,745 (2,857) 3,888
Between 90 days and 1 year 21,529 (5,186) 16,343 20,877 (8,401) 12,476
Between 1 and 2 years 23,385 (5,943) 17,442 23,807 (8,222) 15,585
Between 2 and 3 years 20,079 (4,807) 15,272 17,114 (5,729) 11,385
Between 3 and 4 years 13,628 (3,699) 9,929 11,733 (3,993) 7,740
Between 4 and 5 years 19,946 (2,812) 17,134 10,426 (3,196) 7,230
More than 5 years 35,126 (8,574) 26,552 57,181 (12,774) 44,407
Total 140,595 (32,756) 107,839 147,883 (45,172) 102,711

The total future lease payments for operating leases and rental expenses recognized in the statements of
comprehensive income are summarized in the following tables:

Future lease payments for operating issues 12/31/2018 1213112017
ThUS$ ThUS$
Less than one year 82,843 121,172
Between one and five years 164,132 263,495
More than five years 19,376 47,239
TOTAL 266,351 431,906
a o 12/31/2018 12/31/2017
Rental fees recognized in the statement of comprehensive income ThUS$ ThUSS$
Rental expenses 191,311 228,104

The table below details changes in CODELCOSs liabilities classified as financing activities in the statement
of cash flow, including both cash and non-cash changes for the ended December 31, 2018:

Changes that do not represent cash flow

Initial Balance at Flows of cash Effective Interest | — Other
Financial Cost Fair Value — [accretion/amortizat
Liabilities forfinancing activities 11112018 From Used Total (Mm Exchange Adjustment | ¡on notcah flow Final Balance at
Difference related 12/31/2018
ThUS$ ThUS$ ThUS$ ThUS$ ThUs$ ThUS$ ThUS$ ThUS$ ThUS$ ThUs$
[Loans wifi inandal insitulons 2,460,384 300,000 | (333,027)| (33,027) 84,592 – – – 2.511.949
Bond Obligatons 12.249.406 600.000 | (541,341) 58,659 543874 (101,299) – (4,904) 12,745,736
Obiigatons for coverage 83,896 (18,980)| (18/30) 20.070 35,884 (4,788) – 116,132
Paid Dividens – (602.461)| — (602.461) – – – (602,461)
Financial assets for hedge derivalves (137,544) – – – 66,177 (96,333) – (107,700)
Finanoe leases 102,711 (27,130)| —— (27,130) 2,774 2645 26,839 107,839
¡Capital contibuton – | 600.00 – | 600.000 – – – –
¡Other 69813 – (e9200)| (99,200) 82.886 – – – 10.844 64,343
[Total liabilies from financing activities 14,828,666 | — 1:500,000| —(1.622,088)| (122,089) 734,196 3.407 (41.121) (4.904) 37,683 14,835,838
Changes that do not represent cash flow
Initial Balance at Flows of cash . Fair Value — | Effective Interest
Liabiites forfinancing activi 12017 » Used Total a a A Adjustment — [accretion/amortizat Final Balance at
sabes foriinancing activites mm se oa (1 Difference ionnotcahflow | Other 1213112017
ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThUS$ ThuS$ ThUS$
Loans wih inandalinstiulons 3,154,741] — 300.000] (1,043,246) — (743,246) 74,342 (25,453) – – – 2460384
Bond Obligatons 11,758,820 | 2,760,000 | (3094,341)| — (344,341) 521,750 163,314 – – 149,863 12.249.406
Obiigatons for coverage 171,061 15,737 – 15,737 15,553 (89,036)| (6,162) (23257) – 83,896
Paid Dividens – | (273332) — (273332) – – – – –
Financial assels for hedge derivatves (63,781)| 5291 – 5291 4,765 (71,579) (85497) 23257 – (137,544)
Finance leases 124,491 (25565) (25565) – – – 3,785 102,711
¡Capital contibuton -| 995000 – | 995,000 – –
¡Other 74,253 – (45980)| (45,980) – – – – 41,540 69813
“Total liabilties fromfinancing activities 15.219.585] — 4,066,028] —(4,482,464)| (416.436) 516.410 (22,754) (41,659) – 195.188 14,820,666.

77

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

15.

16.

(1) The finance costs consider the capitalization of interest, which for the year ended December 31, 2018
and 2017, amounts to TRUS$311,399 and ThUS$217,031, respectively.

Fair Value of financial assets and liabilities

The carrying amount of financial assets is a reasonable approximation to their fair value, therefore, no
additional disclosures are required in accordance with IFRS 7.

Regarding financial liabilities, the following table shows a comparison as of December 31, 2018 between
the carrying amount and the fair value of financial liabilities other than those whose carrying amount is a
reasonable approximation of fair value.

Comparison value book vs fair value Accounting treatment for Carrying amount Fair value
as of December 31, 2018 valuation ThUS$ ThUus$
Financial liabilities:
Bond Obligations Amortized cost 12,745,736 13,131,637

Fair value hierarchy

The estimated fair value for the Corporation’s portfolio of financial instruments is based on valuation
techniques and observable inputs. Considering the hierarchy of the data used in these valuation techniques,
the assets and liabilities measured at fair value can be classified into the following levels:

+» Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.

+ Level 2: Inputs other than quoted prices included within Level 1 that are observable for the assets or
liabilities, either directly (i,e, as prices) or indirectly (i,e, derived from prices).

+ Level 3: Inputs are significant unobservable inputs for the asset or liability.

The following table presents financial assets and liabilities measured at fair value as of December 31, 2018:

12/31/2018

Financial instruments measured at fair value Level 1 Level 2 Level 3 Total

ThUS$ ThUS$ ThUS$ ThUS$
Financial Assets
Provisional price sales contracts – 789,710 – 789,710
Cross Currency Swap – 107,700 – 107,700
Mutual fund units 1,698 – – 1,698
Metal futures contracts 58,501 – – 58,501
Financial Liabilities
Metal futures contracts 726 62 – 788
Cross Currency Swap – 116,132 – 116,132

There were no transfers between the different levels during the period ended December 31, 2018.

78
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

17. Trade and other payables

The detail of trade and other current payables as of December 31, 2018 and 2017, ¡is as follows:

Currents
ltems 12/31/2018 12/31/2017
ThUus$ ThUus$
Trade payables 1,317,623 1,376,270
Dividends payables – 295,842
Payables to employees 21,561 17,177
Withholdings 72,681 88,386
Withholding taxes 60,621 36,020
Other payables 74,098 102,073
Total 1,546,584 1,915,768

18. Other provisions

The detail of other current and non-current provisions as of December 31, 2018 and 2017, ¡is as follows:

Current Non-current
Other Provisions 12/31/2018 12/31/2017 12/31/2018 12/31/2017
ThUS$ ThUs$ ThUS$ ThUS$

Sales-related provisions (1) 2,692 4,177 –
Operating (2) 233,277 152,075
Law No. 13196 93,309 134,013 – –
Other provisions 51,771 31,166 20,153 18,790
Onerous Contract (3) 3,200 3,200 4,534 7,734
Decommissioning and restoration (4) – – 1,506,162 1,636,695
Legal proceedings – 69,334 48,583

Total 384,249 324,631 1,600,183 1,711,802

(1) Corresponds to a sales-related accruals, which includes charges for freight, loading, and unloading that
were not invoiced at the end of the period.

(2) Corresponds to a provision for customs duties, freight on purchases, electricity, among others.

(3) Corresponds to a provision recognized for an onerous contract with Copper Partners Investment
Company Ltd, See Note 31 b).

(4) Corresponds to the provision for future decommissioning and site restoration costs primarily related to
tailing dams, closures of mine operations and other mining assets. The amount of the provision is the
present value of future expected cash flows discounted at a pre-tax rate of 2.03% for the obligations in
Chilean currency and 2.78% for the obligations in U.S. dollar. Both, discount rates reflect the
corresponding assessments of the time value of money and the risks specific to the liability. The discount
rate does not reflect risks for which future cash flow estimates have been made. The discount period
varies between 9 and 54 years.

The Corporation determines and recognized this liability in accordance with the accounting policy
described in Note 2, letter p) on Significant Accounting Policies.

79
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Changes in Other provisions, were as follows:

1/1/2018
12/31/2018
Changes Other Provisions, |Decommissioning . .
. Contingencies Total
non-current and restoration
TRUS$ TRUS$ TRUS$ ThUS$

Opening balance 26,524 1,636,695 48,583 1,711,802
Adjust closing provision – (117,174) (117,174)
Financial expenses – 34,754 – 34,754
Pay ment of liabilities – (827) (5,100) (5,927)
Foreign currency translation (3,617) (52,704) (3,574) (59,895)
Provision increase (3,200) – (3,200)
Other increases 4,980 5,418 29,425 39,823
Closing Balance 24,687 1,506,162 69,334 1,600,183

19. Employee benefits
a. Provisions for post-employment benefits and other long term benefits

Provision for post-employment benefits mainly corresponds to employee severance indemnities and
medical care plans. The provision for severance indemnities recognizes the contractual obligation that
the Corporation has with its employees/retirees regardless of the reason for employee’s departure. The
provision for medical care plans recognizes the contractual obligation that the Corporation has with ¡ts
retirees/employees to cover their medical care costs.

Both long-term employee benefits are stated in the terms of employment contracts and collective
bargaining agreements as agreed to by the Corporation and its employees.

These defined benefit liabilities are recognized in the statement of financial position, at the present value
of the defined benefit obligation. The discount rate applied is determined by reference to the market
yields of government bonds in the same currency and estimated term of the post-employment benefit
obligations.

The defined benefit obligations are denominated in Chilean pesos, therefore the Corporation is exposed
to foreign exchange rate risk.

Actuarial gains and losses resulting from changes in actuarial assumptions and experience adjustments
are recognized in other comprehensive income and are not subsequently reclassified to profit or loss.

For the year ended December 31, 2018, there were no significant changes in post-employment benefits
plans.

80
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The following actuarial assumptions were used in the actuarial calculation of the defined benefit plans:

Assumptions 12/31/2018 12/31/2017
Retirement plan Health plan Retirement plan Health plan
Annual Discount Rate 4.49% 4.93% 4.86% 5.27%
Voluntary Annual Turnover Rate for Retirement (Men) 3.90% 3.90% 3.90% 3.90%
Voluntary Annual Turnover Rate for Retirement (Women) 3.30% 3.30% 3.30% 3.30%
Salary Increase (real annual average) 4.03% – 4.03% –
Future Rate of Long-Term Infiation 3.00% 3.00% 3.00% 3.00%
Infation Health Care – 5.05% – 5.05%
Mortality tables used for projections CB14-RV14 CB14-RV14 CB14-RV14 CB14-RV14
Average duration of future cash flows (years) 7.50 16.90 7.50 17.22
Expected Retirement Age (Men) 60 60 60 60
Expected Retirement Age (Women) 59 59 59 59

The discount rates correspond to the rates in the secondary market of government bonds issued in Chile.
The annual inflation corresponds to the long-term expectation set by the Central Bank of Chile. The
turnover rates were determined using the past three years of historical experience of the Corporation’s
employee departure behavior. The expected rate of salary increases has been estimated using the long-
term behavior of historical salaries paid by the Corporation. The mortality tables used were those issued
by the CMF, which are considered an appropriate representation of the Chilean market given the lack of
comparable statistical series to develop independent studies. The period over which the obligation is
being amortized corresponds to the estimate of the period over which the cash flows will occur.

b. The detail of current and non-current provisions for employment benefits as of December 31, 2018 and
2017, is as follows:

Current Non-current
Accrual for employee benefits 12/31/2018 12/31/2017 12/31/2018 12/31/2017
ThUS$ ThUS$ ThUs$ ThUs$

Employees’ collective bargaining agreements 204,040 218,167 – –
Employee termination benefit 27,247 31,468 802,260 850,622
Bonus 60,616 62,921 – –
Vacation 183,628 176,489 – –
Medical care programs (1) 460 443 496,323 523,206
Retirement plans (2) 17,620 7,987 8,355 9,494
Other 16,423 19,206 8,582 9,337

Total 510,034 516,681 1,315,520 1,392,659

(1) Corresponds to a provision recognized for the obligations with health care institutions as agreed
with current and former employees.
(2) Correspond to the provision recognized for early retirement benefits provided to employees.

81
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The reconciliation of the present value of the post-employment benefit obligation, is as follows:

11112018 1/11/2017
12/31/2018 12/31/2017
Movements
Retirement plan Health plan Retirement plan Health plan
ThUS$ ThUS$ ThUS$ ThUs$
Opening balance 882,090 523,649 777,706 538,237
Service cost 72,821 9,962 65,284 936
Financial cost 15,966 11,520 9,332 8,666
Paid contributions (57,166) (39,779) (57,897) (37,678)
Actuarial (gains)/losses 16,576 30,200 7,178 (31,426)
Transfer from other benefits 3,335 – 3,346 –
Subtotal 933,622 535,552 804,949 478,735
(Gains) Losses on foreign exchange rate (104,115) (38,769) 77,141 44,914
Final Total 829,507 496,783 882,090 523,649

The technical revaluation (actuarial gain/loss as defined under IAS 19) of the liability for compensation
benefits for years of service has been made, for the year ended December 31, 2018. Such was charged
to equity, which consists of an actuarial loss of ThUS$16,576, corresponding primarily to a change in
financial assumptions. . Such charge to equity is broken down into a loss of ThUS$15,584 for the
revaluation of financial assumptions and an experience loss of ThUS$992.

For the obligation generated by health benefit plans, an actuarial loss of ThUS$30,200 has been
determined, consisting primarily of an adjustment for financial assumptions which is composed of a loss
for changes in the financial assumptions of ThUS$25,930; and an experience loss of ThUS$4,270.
The balance of the defined benefit liability as of December 31, 2018, comprises a short term portion of
ThUS$27,247 and ThUS$460 for the termination indemnities plan and the medical care plan,
respectively. The expected amount of the defined benefit liability projected at December 31, 2019,
consists of ThUS$881,076 for the termination indemnities plan and ThUS$457,843 for the medical care
plan. The expected monthly average future disbursements related to defined benefit plans are of
ThUS$2,271 for termination indemnities and of ThUS$38 for medical care.

The following table sets forth the sensitivity analysis of the value of the each line item for a change,
respectively, from the medium (used in the estimate recorded) to the low and from the medium to the
high; the second to the last column represents the change between the low and medium and the last
column represents the change between the medium and the high:

82
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Severance Benefits for Years of Service Low Medium High Reduction Increase
Financial effect on interest rates 3.490% 4.490% 5.490% 5.46% 4.78%
Financial effect on the real increase in income 3.530% 4.030% 4.530% -2.21% 2.34%
Demographic effect of job rotations 3.340% 3.840% 4.340% 0.78% 0.69%
Demographic effect on mortality tables -25.00% CB14-RV14, Chile 25.00% 0.07% 0.07%

Health Benefits and Other Low Medium High Reduction Increase
Financial effect on interest rates 3.926% 4.926% 5.926% 15.44% -12.06%
Financial effect on health inflation 4.550% 5.050% 5.550% 5.96% 6.65%
Demographic effect, planned retirement age 58/57 60/59 62/61 3.98% 3.90%
Demographic effect on mortality tables -25.00% CB14-RV14, Chile 25.00% 10.22% -7.20%

Cc. Retirement plans and conflict termination bonus

The Corporation under its operational optimization programs seeks to reduce costs and increase labor
productivity, and through the incorporation of modern technologies and/or best management practices
has established employee retirement programs by making corresponding modifications to employment
contracts or collective bargaining agreements, with benefits encouraging early retirement. The early
retirement plans are recognized as a liability and expense as the Corporation can no longer withdraw
the offer of those benefits.

As of December 31, 2018 and 2017, the termination benefits current balance was ThUS$17,620 and
ThUS$7,987, respectively, while the non-current balance was ThUS$8,355 and ThUS$9,494,
respectively. The non-current portion is associated with the provision related to the term of the collective
bargaining process that Codelco’s management negotiated during the month of December 2012 with the
employee unions of the Chuquicamata Division. The non-current amounts recognized have been
discounted using a discount rate equivalent to that used for calculating employee benefits provisions and
whose outstanding balances are part of the balances as of December 31, 2018 and 2017.

d. Employee benefits expenses

The employee benefit expenses recognized for the years ended December 31, 2018 and 2017, are as
follows:

1/1/2018 1/1/2017

Expense by Nature of Employee Benefits 12/31/2018 12/31/2017

TRUS$ ThUS$
Benefits – Short term 1,731,593 1,633,536
Benefits – Post employ ment 9,962 936
Benefits – Retirement plans and confiict termination 54,594 20,553
Benefits by years of service 72,821 65,284
Total 1,868,970 1,720,309

83
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

20.

Equity

The Corporation’s total equity as of December 31, 2018 is ThUS$11,343,869 (ThUS$10,925,338 as of
December 31, 2017).

In accordance with article 6 of Decree Law 1350 of 1976, it is established that, before March 30 of each
year, the Board must approve the Corporation’s Business and Development Plan for the next three-year
period. Taking that plan as a reference, and keeping in mind the Corporation’s balance sheet for the
immediately preceding year and aiming to ensure its competitiveness, before June 30 of each year the
amounts that the Corporation shall allocate to the formation of capitalization funds and reserves shall be
determined by decree from the Ministries of Mining and Treasury.

Net income shown in the balance sheets, after deducting the amounts referred to in the previous paragraph,
shall belong to the State and becomes part of the Nation’s general income.

Pursuant to the Exempt Decree No. 184 of June 27, 2014 of the Ministry of Finance, the Corporation was
authorized to capitalize US$200 million of the net profit of the financial statements as of December 31, 2013.
Those resources were charged to the profits of 2014.

On October 24, 2014, the President of the Republic of Chile signed Law No. 20790. Such Law sets forth an
extraordinary capital contribution of up to US$3 billion for the Corporation during the period of 2014-2018.
The resources obtained from such capital contribution, together with the capitalization of the profits obtained
during such period — up to US$800 million — generated in that period, will serve to boost the Investment
Plan in mining projects, sustainability, mining development and renewal of equipment and industrial plants.
At December 31, 2014, there were no capitalized resources under such statute.

Pursuant to the Exempt Finance Decree (Decree No. 197 of December 31, 2015 issued by the Ministry of
Finance), the Corporation was authorized to capitalize US$225 million of the net profit registered in the
financial statements as of December 31, 2014.

Those resources were to be taken from the profits for year 2015 for their capitalization.

Pursuant to the ORD Finance Ministry Officio No. 1410 dated on May 27, 2016, it was established that the
aforementioned Decree confirms the impossibility of capitalizing the aforementioned US$225 million,
consequently the capitalization fund comprised of said amount was reversed.

On October 28, 2015, it was reported that after reviewing the Development Business Plan 2014-2018 for
Codelco, it was decided to make a capital contribution of US$600 million that was made effective on
December 2, 2015.

On December 1, 2016, it was informed that, pursuant to Article 1 of Law No. 20790, it was decided to make
an extraordinary capital contribution of US$500 million, which was made effective on December 28, 2016.

Both capital contributions were funded by the Public Treasury through the sale of financial assets.

84
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

On January 27, 2017, Law No. 20989 on extraordinary capitalization was enacted. The Law authorizes the
transferring of funds from application of the Copper Reserved Law to the Public Treasury, allowing an
extraordinary capitalization to Codelco of up to US$950 million for year 2017 aiming to reduce Codelco’s
indebtedness in an amount equivalent to the difference between the funds transferred as required by the
Reserved Law and cash flow surpluses obtained by the Corporation.

On March 13, 2017, through Decree No. 322 an extraordinary capital contribution was authorized under
Article 2 of Law No. 20989, for a total amount of US$475 million. The capital contribution was made effective
on April 13, 2017.

By Exempt Decree of Treasury No. 1698, dated November 17, 2017, in accordance with the provisions of
Article 1 of Law No. 20790, it was decided to make an extraordinary contribution of capital for an amount of
US$520 million, which were recorded on December 22, 2017.

On October 16, 2018, the Ministry of Finance issued Exempt Decree 311 in which it has an extraordinary
capital contribution for Codelco pursuant to Law No. 20,790 of US $ 1,000 million, which will be made in a
first part for US $ 600 million and in a second part for US $ 400 million, and that will be transferred in
installments that will not be timed later than December 31, 2018 and February 28, 2019 respectively. On
December 26, 2018 the Corporation received the first part of the contribution to capital for US $ 600 million.

As of December 31, 2018, the dividends paid were ThUS$602,461 as follows:

ThUS$
Dividends payable as of December 31, 2017 295,842
Advance dividends as of December 31, 2018 155,719
Advance dividends overpaid as of December 31, 2018 150,900
Total dividends paid as of December 31, 2018 602,461

As of December 31, 2017, the dividends paid amounted to ThUS $ 273,332, and provisioned dividends
payable ThUS $ 295,842.

The consolidated statement of changes in equity discloses the changes in the Corporation’s equity.

The movement and composition of other equity reserves is presented in the consolidated statement of
changes in equity.

Reclassification adjustments from other comprehensive income to profit or loss resulted in a loss of
ThUS$9,273 and ThUS$1,694 for the years ended December 31, 2018 and 2017, respectively.

85
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

a) Other reserves

The detail of other reserves as of December 31, 2018 and 2017, is as follows:

Total other reserves

12/31/2018
Other Reserves 12/81/2017
ThUS$ ThUS$
Reserve on exchange differences on translation (6,863) (6,015)
Reserve of cash flow hedges 47,792 11,336
Capitalization fund and reserves 4,962,393 4,962,393
Reserve of remeasurement of defined benefit plans (274,480) (259,002)
Other reserves 625,317 626,380
5,354,159 5,335,092

b) Non-controlling interests

The detail of non-controlling interests, included in equity and profit or loss, as of and for each reporting

year, is as follows:

Non-controlling participation Net equity Gain (loss)
1/1/2018 1/1/2017
Societies 12/31/2018 12/31/2017 12/31/2018 12/31/2017 12/31/2018 4213112017
% % ThuS$ LES ThUuS$ ThUS$
Inversiones Gacrux SpA 32.20% 32.20% 969,203 1,007,493 34,031 54,423
Others – – 1 2 (3) 4
Total 969,204 1,007,495 34,028 54,427

For the year ended December 31, 2018, Inversiones Gacrux SpA did not distribute any dividends to

non-controlling interests.

The percentage of non-controlling interest in Inversiones Mineras Becrux SpA (previously Inversiones
Mineras Acrux SpA) generates a non-controlling interest in our subsidiary Inversiones Gacrux SpA,
which presents the following figures relating to its statement of financial position, statement of

comprehensive income and cash flows:

86

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Assets and liabilities 12/31/2018 12/81/2017
ThUS$ ThUS$
Current Assets 361,568 306,496
Non-current assets 2,839,764 2,959,114
Current liabilities 176,742 158,455
Non-current liabilities 593,078 676,208
1/11/2018 1/1/2017
Results 12/31/2018 12/31/2017
ThUS$ ThUS$
Revenues 836,195 586,640
Expenses (762,557) (496,650)
Profit of the period 73,638 89,990
1/11/2018 1/1/2017
Cash flow 12/31/2018 12/31/2017
ThUS$ ThUS$
Net cash flow from operating activities 142,997 204,342
Net cash flow from (using) investing activities – (38,049)
Net cash flow from (using) financing activities (204,961) (25,512)

21. Revenue

Revenues as of December 31, 2018 and 2017, are as follows:

1/11/2018 1/11/2017
Item 12/31/2018 12/31/2017
ThUs$ ThUS$
Revenue from sales of own copper 11,195,340 11,636,279
Revenue from sales of third-party copper 1,900,899 2,005,974
Revenue from sales of molyodenum 651,305 502,382
Revenue from sales of other products 537,562 498,207
Gain (loss) in futures market 23,652 (1,287)
Total 14,308,758 14,641,555

The Corporation’s revenue is recognized at a point in time.

The breakdown of revenue ¡is presented in explanatory note No.26 Operating Segments.
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

22.

23.

Expenses by nature

Expenses by nature as of December 31, 2018 and 2017, are as follows:

11112018 1/11/2017
Item 12/31/2018 12/31/2017
ThUs$ ThUS$
Short-term benefits to employees 1,731,593 1,633,536
Depreciation 1,186,480 1,152,803
Amortization 994,660 948,298
Total 3,912,733 3,734,637

Impairment of Assets

As of December 31, 2018, the Corporation made a calculation of the recoverable amount of its cash
generating unit Windows Division, for the purpose of checking the existence of a deterioration in the value
of the assets associated with said division, the carrying amount of which amounted to US$323 million.

The aforementioned calculation of the recoverable amount determined a value of US$124 million, which
compared with the amount in books, implied an acknowledgment of an impairment loss of assets for
ThUS$ 198,898 (before tax), which was recorded in the Other ¡item expenses by function, of the
comprehensive income statement for the year 2018 (note 24b).

The recoverable amount determined for the calculation of the impairment loss corresponds to value in use
using a 7.2% annual discount rate before taxes. The main variables used to determine the recoverable
amount of this asset correspond to the price of acid, cost of treatment and refining, exchange rates and
discount rates.

The aforementioned loss due to impairment is mainly generated by the fall in the costs of treatment and
refining.

As of December 31, 2017, the Corporation recognized a reversal of a portion of the impairment loss
previously recognized on the Anglo American Sur investment (Explanatory Note 9).

As of December 31, 2018 and 2017 there are no signs of additional deterioration or reversals of impairment
recognized in previous years.

88
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

24. Other income and expenses by function

Other income and expenses by function for periods ended December 31, 2018 and 2017, are as follows:

a) Other income by function

11112018 1/11/2017
Item 12/31/2018 12/31/2017
ThUS$ ThUS$
Penalties to suppliers 18,920 10,926
Delegated Administration 5,346 4,458
Miscellaneous sales (net) 25,973 33,243
Insurances recoveries by incidents – 16,757
Profit on sale of shares of Deutsche Giessdraht GmbH (See note 7) 18,279 –
Other income 56,308 88,948
Total 124,826 154,332
b) Other expenses by function
1/1/2018 1/1/2017
Item 12/31/2018 12/31/2017
ThHUS$ TRHUS$
Law No. 13196 (1,108,209) (1,098,556)
Research expenses (103,649) (110,942)
Bonus for the end of collective bargaining (204,623) (28,577)
Expenses plan (54,594) (20,553)
Write-off of investment projects (See Note 10) (212,587) (74,655)
Write-off of property, plant 8, equipment (7,357) (11,824)
Medical care plan (9,962) (936)
Additional bonuses to contractors – (161)
Impairment of assets (note 22) (198,898) –
Write-off inventories (4,004) (14,187)
Write-off by onerous contract – (10,279)
Bad debts clients (671) (21,851)
Additional bonus – (3,149)
Contingency expenses (36,359) (23,046)
Other (174,401) (138,757)
Total (2,115,314) (1,557,473)

89
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

25.

26.

Finance costs

The detail of finance costs for the years ended December 31, 2018 and 2017, is as follows:

1/1/2018 1/1/2018
Item 12/31/2018 | 12/31/2017
Thus$ LES
Bond interest (265.001) (333.717)
Bank loan interest (69.869) (74.583)
Unwinding of discount on severance indemnity provision (16.497) (12.301)
Unwinding of discount on other non-current provisions (46.959) (34.751)
Other (65.122) (189.258)
Total (463.448) (644.610)

Operating segments

The Corporation has defined its Divisions as ¡ts operating segments in accordance with the requirements of
IFRS 8, Operating Segments. The revenues and expenses of the Head Office are allocated among the
defined operating segments.

The mining deposits in operation, where the Corporation conducts its extractive and processing activities
are managed by the following Divisions: Chuquicamata, Radomiro Tomic, Ministro Hales, Gabriela Mistral,
Salvador, Andina and El Teniente. In addition, the smelting and refining activities are managed at the
Ventanas Division. All these Divisions have a separate operational management, which reports to the Chief
Executive Officer, through the North and South Central Vice-President of Operations, respectively.

The information on each Division and their corresponding mining deposits is as follows:

Chuquicamata

Types of mine sites: Open pit mines

Operating: since 1915

Location: Calama — Region |

Products: Electro refined and electrolytic (electro-obtained) copper cathodes and copper concentrate

Radomiro Tomic

Types of mine sites: Open pit mines

Operating: since 1997,

Location: Calama — Region |

Products: Electro refined and electrolytic (electro-obtained) copper cathodes and copper concentrate

Ministro Hales

Type of mine: Open pit mine
Operating: since 2014
Location: Calama — Region |

90
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Products: Calcined copper, copper concentrates

Gabriela Mistral

Type of mine: Open pit mine

Operating: since 2008

Location: Calama — Region |

Products: Electrolytic (electro-obtained) cathodes

Salvador

Type of mine: Underground mine and open pit mine

Operating: since 1926

Location: Salvador — Region |1l

Products: Electro refined and electrolytic (electro-obtained) copper cathodes and copper concentrate

Andina

Type of mines: Underground and open pit mines
Operating: since 1970

Location: Los Andes – Region V

Product: Copper concentrate

El Teniente

Type of mine: Underground mine

Operating: since 1905

Location: Rancagua — Region VI

Products: Fire-refined copper and copper anodes

a) Allocation of Head Office revenue and expenses

Revenue and expenses controlled by the Head Office are allocated to the Divisions based on following
criteria.

Revenue and Cost of Sales of Head Office commercial transactions

+ Allocation to the operating segments is made in proportion to revenues of each Division.

Other income, by function

+ Other income by function, associated and identified with each Division, is directly allocated.

+ Recognition of realized profits and other income by way of subsidiaries are allocated in proportion to
the revenues of each Division.

+ The remaining other income is allocated in proportion to the aggregate of balances of “other income
and “finance income” of each Division.

91
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Distribution costs

+ Expenses associated and identified with each Division are directly allocated.
+ Distribution costs of subsidiaries are allocated in proportion to the revenues of each Division.

Administrative Expenses

+ Administrative expenses associated and identified with each Division are directly allocated,

+ Administrative expenses recorded in cost centers associated with the sales function and
administrative expenses of subsidiaries are allocated in proportion to the revenues of each Division.

+ Administrative expenses recorded in cost centers associated with the supply function are allocated
in proportion to inventory balances in warehouse in each Division.

+ Theremaining administrative expenses are allocated in proportion to operating cash outflows of each
Division.

Other Expenses, by function

+ Other expenses associated and identified with each Division are directly allocated.

+ Expenses for pre-investment studies and other expenses by function of subsidiaries are allocated in
proportion to the revenues of each Division.

Other gains

+ Other gains associated and identified with each Division are directly allocated.
+ Other gains of subsidiaries are allocated in proportion to the revenues of each Division.

Finance Income

+ Finance income associated and identified with each Division is directly allocated.

+ Finance income of subsidiaries is allocated in proportion to the revenues of each Division.

+ The remaining finance income is allocated in relation to the operating cash outflows of each Division.

Finance costs

+ Finance costs associated and identified with each Division are directly allocated.
+ Finance costs of subsidiaries are allocated in proportion to the revenues of each Division.

Share in profit (loss) of associates and joint ventures accounted for using the equity method
+ Share in profit or loss of associates and joint ventures identified for each Division is directly allocated.
Foreign exchange differences

+ Foreign exchange differences identifiable with each Division are directly allocated.

92
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

+ Foreign exchange difference of subsidiaries is allocated in proportion to the revenues of each
Division.

+ The remaining foreign exchange differences are allocated in relation to operating cash outflows of
each Division.

Contribution to the Chilean Treasury under Law No. 13196

+ The amount of the contribution is allocated and accounted for in proportion to the invoiced and
recorded amounts for copper and sub-product exports of each Division, that are subject to the
surcharge.

Income tax benefit (expenses)

+ Corporate income tax under D.L. 2398 and specific mining tax are allocated based on the income
before income taxes of each Division, considering for this purpose the income and expenses
allocation criteria of the Head Office and subsidiaries mentioned above.

+ Other tax expenses are allocated in proportion to the corporate income tax, specific mining tax and
tax under D.L. 2398 of each Division.

b) Transactions between segments

Transactions between segments mainly related to products processing services (or tolling services), are
recognized as revenue for the segment rendering the tolling services and as the cost of sales for the
segment that receives the service. Such recognition is made in the period in which these services are
rendered, as well as ¡ts elimination in the consolidated corporate financial statements.

Additionally, the reallocation of the profit and loss assumed by Ventanas Division, associated with the
corporate mineral processing contract between Codelco and Enami, in which a distribution is applied
based on the revenue of each division is included as a transaction between segments.

c) Cash flows by segments
The operating segments defined by the Corporation, has a cash management which refers mainly to
operational activities that need to be covered periodically with funds constituted in each of these
segments and whose amounts are not significant in relation to corporate balances of cash and cash
equivalents.

Conversely, activities such as obtaining financing, investment and payment of relevant financial
obligations are mainly based at the Head Office.

93
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The following tables details the financial information organized by operating segments:

From 1/1/2018
12/31/2018
. . . . . Total Subsidiaries and Total
Segments Chuquicamata | R. Tomic Salvador Andina El Teniente | Ventanas | G. Mistral M.Hales | somente | Head Offico, net | Consolidated
Thus$ ThuS$ ThuSs$ ThUS$ ThUS$ ThUS$ ThuSs$ ThUS$ ThUS$ ThUS$ ThUS$

Revenue from sales of own copper 3.100.186 | — 2.058.291 365.850 1.102.898 | — 2.778.189 13.497 641.681 1.125.496 | — 11.186.088 9.252 11.195.340
Revenue from sales of third-party copper 177 – – – – 14.597 – 23.123 37.897 1.863.002 1.900.889
Revenue from sales of molybdenum 359.996 15.751 20.356 88.841 164.388 – – – 649.332 1.973 651.305
Revenue from sales of olher products 142.143 – 42.781 3.483 91.443 196.436 – 59.416 535.702 1.860 537.562
Revenue from futures market 8.474 10.322 687 (106) 1.210 64 2.316 685 23.652 – 23.652
Revenue betw een segments 122.767 – 73.379 1.487 94 105.787 – – 303.514 (303.514) –
Revenue 3.733.743 | 2.084.364 503.053 1.196.603 | 3.035.324 330.381 643.997 1.208.720 | 12.736.185 1.572.573 14.308.758
Costof sales of own copper (2.880.603)| — (1.343.886) (397.189) (e31.698)] — (1.637.057) (3.889) (540.134) (896.470)| — (8.630.926) (15.076) (8.646.002)
Cost of sales of copper third-party copper (192) – – – – (16.345) – (23.123) (39.660) (1.841.680) (1.881.340)
Cost of sales of moly bdenum (79.793) (8.902) (9.530) (25.980) (1.627) – – – (175.832) (18.048) (193.880)
Cost of sales of other products (140.063) – (27.477) (738) (74.274) (214.792) – (14.166) (471.510) (1.609) (473.119)
Cost of sales beween segments (198.829) 52.328 (79.004) 4,217 17.831 (117.771) (1.228) 18.942 (303.514) 303.514 –
Cost of sales (3.299.480)| (1.300.460) (513.200) (054.199)| — (1.745.127) (852.797) (541.362) (914.817)| — (9.621.442) (1-572.899) (11.194.341)
Gross profit 434.263 783.904 (10.147) 242.404 1.290.197 (22.416) 102.635 293.903 | 3.114.743 (326) 3.114.417
Other income, by function 10.994 5.769 4.497 14.348 18.018 1.819 3.108 4.577 63.130 61.696 124.826
Impairment loss determined in accordance with IFRS 9 – – – – – – – – – 158 158
Distribution costs (3.010) (570) (1.049) (944) (1.140) (597) (139) (1.043) (8.492) (9.770) (18.262)
Administrative expenses (60.412) (32.429) (17.676) (22.649) (66.815) (9.796) (22.361) (32.077) (264.215) (201.113) (465.328)
Other expenses, by function (97.154) (35.056) (125.943) (82.589) (171.207) (210.008) (12.023) (87.058) (781.038) (226.067) (1.007.105)
Law No. 13.196 (314.516) (201.452) (34.027 (118.451) (265.868) (15.137) (63.789) (94.969)| — (1.108.209) – (1.108.209)
Other gains (losses) – – – – – – – – – 21.395 21.395
Finance income. 189 244 126 115 2.174 84 18 160 3.110 48.219 51.329
Finance costs (62.271) (46.437) (14.073) (61.517) (155.965) (8.625) (17.075) (46.664) (412.627) (50.821) (463.448)
Share in the profit (loss) of associates and joint ventures 174 – (75) (466) (2259) – – – (9.020) 122.134 119114
accounted by the equity method
Exchange diflerences 88.760 14.668 15.552 33.218 45.160 10.859 5.344 11.678 225.239 (47.096) 178.143
Income (loss) before taxes 2.983 488.641 (183.215) (63.351) 692.301 (253.817) (4.282) 98.507 828.621 (281.591) 547.030
Income tax expenses 2.070 (329.166) 128.918 1.928 (476.388) 181.869 2.890 (68.015) (655.894) 198.611 (357.283)
Income (loss) 913 159.475 (54.297) (4.603) 215.913 (71.948) (1.392) 30.492 272.727 (82.980) 189.747

94
CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

From 1/1/2017
12/31/2017
. . . . . Total Subsidiaries and Total
Segments Chuquicamata | R. Tomic Salvador Andina — | El Teniente | Ventanas | G.Mistral [| M.Hales | como | Head Office, net | Consolidated
ThUS$ ThUS$ ThuSs$ Thus$ ThUS$ ThuSS Thus$ ThUS$ ThuSS Thus$ ThUS$

Revenue from sales of own copper 2.823.439 | 2.009.715 502.181 1.326.314 | — 2.850.926 12.206 798.407 | — 1.344.509 | 11.667.697 (81.418) 11.636.279
Revenue from sales of hird-party copper (1.165) – (104) – – 32.392 – 237.708 268.831 1.737.143 2.005.974
Revenue from sales of moly bdenum 276.868 40.654 16.005 65.908 101.571 – – – 501.006 1.376 502.382
Revenue from sales of olher products 128.696 – 44,254 7.500 69.083 196.513 – 52.161 498.207 498.207
Revenue from futures market (124) 40 29 35 571 (1.772) 42 (111) (1.290) 3 (1.287)
Revenue between segments 117.638 – 82.308 801 194 102.564 – – 303.505 (803.505) –
Revenue 3.345.352 | 2.050.409 644.673 | 1.400.558 | 3.022.345 341.903 798.449 | 1.634.267 | 13.237.956 1.403.599 14.641.555
Costof sales of own copper (2.063.065)|— (1.290.391) (440.523) (837.786)| — (1.562.246) (9.193) (546.845) (870.282)| — (7.820.831) 27.456 (7.792.875)
Costof sales of copper third-party copper – – – – (32.961) – (237.770) (270.731) (1.728.913) (1.999.644)
Costof sales of molybdenum (84.777) (28.807) (9.656) (24.030) (40.445) – – – (187.715) (1.345) (189.060)
Costof sales of other products (72.475) – (22.953) (814) (84.159) (206.512) – (11.900) (398.813) (11) (398.824)
Costof sales beween segments (283.468) 80.943 (68.990) 16.388 11.131 (125.547) – 56.038 (803.505) 303.505 –
Cost of sales (2.503.785)| (1.238.255) (632.122) (946.242) | — (1.675.719) (874.213) (546.845)| — (1.163.914) (8.981.095) (1-399.308)| (10.380.403)
Gross profit 841.567 812.154 112.551 454.316 | 1.346.626 (82.310) 251.604 470.353 | 4.256.861 4.291 4.261.152
Other income, by funcion 17.249 22.136 18.044 14.861 28.357 1.361 4.174 5.645 111.827 42.505 154.332
Distribution costs (1.614) (186) (610) (299) (561) (560) – (960) (4.790) (6.613) (10.403)
Administrative expenses (46.703) (26.316) (16.763) (24.352) (63.480) (10.201) (25.947) (20.419) (234.181) (193.959) (428.140)
Other expenses, by function (96.986) (18.370) (49.178) (77.191) (50.258) (11.176) (6.583) (6.546) (315.288) (143.629) (458.917)
Law No. 13.196 (269.112) (196.289) (61.423) (124.627) (255.957, (15.459) (76.530) (109.159)| — (1.098.556) – (1.098.556)
Other gains (losses) – – – – – – – – – 32.605 32.605
Finance income 1.083 549 381 139 2.518 313 393 305 5.681 24.155 29.836
Finance costs (116.215) (53.270) (16.894) (105.146) (215.611) (10.012) (13.626) (66.324) (587.098) (57.512) (644.610)
Share in the profit (loss) of associates and joint ventures
accounted by the equiyy method 529 – 427 (685) 413 – – – e 184.644 185.428
Exchange differences (64.137) (60.635) (19.278) (19.500) (68.197) (9.067) (8.686) (7.838) (257.338) 51.280 (206.058)
Income (loss) before taxes 265.661 479.773 (22.743) 117.616 723.850 (87.111) 125.799 275.057 | 1.877.902 (61.233) 1.816.669
Income tax expenses (189.709) (320.426) 18.324 (91.965) (485.743) 57.108 (81.170) (194.326)| (1.287.907) 94.840 (1-193.067)
Income (loss) 75.952 159.347 (4.419) 25.651 238.107 (30.003) 44.629 80.371 589.995 33.607 623.602

95
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The assets and liabilities related to each operating segment, including the Corporation’s head office as of
December 31, 2018 and 2017, are detailed in the following tables:

12/31/2018
Category Chuquicamata ano Salvador | Andina | ElTeniente | Ventanas | G. Mistral | M.Hales Di mn Cd
ThuSs$ ThUuS$ ThUuS$ ThUS$ ThUuS$ ThuSs$ Thuss ThuSs$ Thuss ThuSs$
Current assets 1.278.051 715.681 278.481 247.676 696.341 89.148| 239.493| 291.782| 1.991.553 5.828.206
Non-current assets 7.863.667 1.941.213 727.675 4.519.739 6.547.657 155.316 1.136.948 3.278.883 5.091.501 31.262.599
Current liabilities 729.319 192.735 115.908 218.550 441.255 61.363 111.615 117.624 1.551.043 3.539.412
Non-current liabilities 855.735 205.997 196.608 472.713 910.005 53.084 116.005 81.958| 19.315.419 22.207.524
12/31/2017
. Radomiro o . . Subsidiaries and Total
Category Chuquicamata Tomic Salvador Andina El Teniente | Ventanas | G. Mistral M.Hales | ad Office, net | Consolidated
Thus$ ThUuS$ ThUuS$ ThuS$ ThUuS$ Thus$ Thuss Thus$ Thuss Thus$
Current assets 1.209.431 747.780 222.573 262.381 796.357 103.143 248.431 336.608| 2.284.349 6.211.053
Non-current assets 6.493.203 2.011.892 699.810 4.326.237 6.143.112 342.980| 1.172.667 3.499.326 5.455.861 30.145.088
Current liabilities 727.862 181.996 140.431 202.925 433.947 62.748 87.669] 99.511 1.378.367 3.315.456
Non-current liabilities 939.029 206.376 216.712 475.508 957.596 60.991 124.334 90.884 19.043.917 22.115.347
The revenue segregated per geographical areas are the following:
1/11/2018 1/11/2017
Revenue per geographical areas 12/31/2018 12/31/2017
ThUS$ ThUS$
Total revenue from domestic customers 1,313,064 1,141,762
Total revenue from foreign customers 12,995,694 13,499,793
Total 14,308,758 14,641,555
1/11/2018 1/11/2017
Revenue per geographical areas 12/31/2018 12/31/2017
ThUS$ ThUS$
China 3,867,505 3,231,719
Restof Asia 1,982,163 1,990,528
Europe 3,482,755 1,353,503
America 3,764,467 3,453,366
Other 1,211,868 4,612,439
Total 14,308,758 14,641,555

96
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The main customers of the Corporation are listed in the following table:

1/1/2018
Principal Customers Country 12/31/2018

ThUS$
Glencore International Ag. Switzerland 1,039,310
Southwire Company United States 720,172
Nexans France France 531,740
Glencore Chile S.P.A. Chile 516,938
Trafigura Pte Ltd. Singapore 502,875
Wanxiang Sg Pte Ltd. Singapore 430,957
Jiangxi Copper Company Ltd. China 359,495
Lobb Heng Pte. Ltd China 303,718
Concord Resources Limited Japan 303,083
Triway International Limited Hong-Kong 274,615
Total 4,982,903

27. Foreign exchange differences

The detail of foreign exchange differences for the years ended December 31, 2018 and 2017, is as follows:

1/11/2018 1/1/2017
Gain (loss) from foreign exchange differences
doss) an nana 12/31/2018 | 12/31/2017
recognized in income

ThUS$ ThUS$
Gain from foreign exchange differences 277,780 74,782
Loss from foreign exchange differences (99,637) (280,840)
Total exchange difference, net 178,143 (206,058)

97
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

28.

29.

Statement of cash flows

The following table shows the items that comprise other collections and payments from operating activities
in the Statement of Cash Flows:

1/11/2018 1/1/2017
Other collections from operating activities 12/31/2018 12/31/2017
ThUS$ ThUS$
VAT Refund 1,513,219 1,373,195
Other 220,336 283,909
Total 1,733,555 1,657,104
1/11/2018 1/1/2017
Other payments from operating activities 12/31/2018 12/31/2017
ThUS$ ThUS$
Contribution to the Chilean Treasury (Law No. 13196) (1,136,559) (1,062,496)
Finance hedge and sales (29,843) (5,090)
VAT and other similar taxes paid (1,388,782) (1,155,782)
Total (2,555,184) (2,223,368)

As of December 31, 2018 and 2017, as indicated in the equity note, capital contributions were received
for a total of ThUS $ 600,000 and ThUS $ 995,000, respectively, which are presented in other cash
inflows (outflows) corresponding to the net cash flows from (used in) activities of financing.

Financial risk management, objectives and policies

Codelco has committees within its organization to set out strategies allowing to reduce the financial risks to
which it may be exposed.

The risks to which Codelco is exposed and a brief description of the management procedures that are
carried out in each case, are described below:

a. Financial risks
– Exchange rate risk:
According to IFRS 7, exchange rate risk is understood to be the risk that arises from financial
instruments that are denominated in foreign currencies, that is, a currency other than the
Corporation’s functional currency (US dollar).
Codelco’s activities that generate this exposure correspond to funding in UF, accounts payable and

receivable in Chilean pesos, other foreign currencies used in its business operations and obligations
with employees.

98
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The majority of transactions in currencies other than US$ are denominated in Chilean pesos. Also,
there is another portion in Euro, which corresponds mainly to a long-term loan issued through the
international market, which exchange rate risk is mitigated with hedging instruments (Swap).

Taking into consideration the financial assets and liabilities as of December 31, 2018 as the base, a
fluctuation (positive or negative) of 10 Chilean pesos against the U.S. dollar (keeping the other
variables constant), could affect profits before taxes by US$33 million in net income, respectively.
This result is obtained by identifying the main items (including assets and financial liabilities)
denominated in foreign currencies in order to measure the impact on profit or loss that a variation
of +/- 10 Chilean pesos would have in terms of US$, with respect to the closing exchange rate at the
end of the reporting period.

As of December 31, 2018, the balance of time deposits denominated in Chilean pesos was
ThUS$270,021 (ThUS$252,161 as of December 31, 2017).

Interest rate risk:

This risk arises from interest rate fluctuations in Codelco’s investment and financing activities. This
movement can affect future cash flows or the market value of fixed rate financial instruments.

These rate variations refer to U.S. dollar variations, mostly with respect to the LIBOR rate. To manage
this risk, Codelco maintains an adequate combination of fixed and variable rate debt, which is
complemented by the possibility of using interest-rate derivatives to meet the strategic guidelines
defined by Codelco’s Corporate Finance Department.

Itis estimated that, on the basis of net debt balance as of December 31, 2018, a 1% change in interest
rates on the financial liabilities subject to variable interest rates would mean approximately a US$19
million change in finance costs, before tax. This estimation is made by identifying the liabilities
assigned to variable interest, accrued at the end of the financial statements, which may vary with a
change of one percentage point in variable interest rates.

Total fixed and variable interest rate obligations maintained by Codelco as of December 31, 2018
corresponds to amounts of ThUS$13,377,093 and ThUS$1,880,592, respectively.

Market risks
– — Commodity price risk:

As a result of its commercial operations and activities, the Corporation’s income is mainly exposed
to the volatility of copper prices and certain sub-products such as gold and silver.

Copper and molybdenum concentrate sale agreements and copper cathode sale agreements

generally provide for provisional pricing of sales at the time of shipment, with final pricing based
on the monthly average market price for specified future periods. At the reporting date, the

99
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

provisionally priced metal sales are marked-to-market, with adjustments (both gains and losses)
being recorded in revenues in the consolidated statement of comprehensive income. Forward
prices at the period-end are used for copper sales, while period-end average prices are used for
molybdenum concentrate sales due to the absence of an assets futures market. (See Note 2.r)
“Income from Activities Ordinary Procedures from Contracts with Customers “of section 11” Main

policies countable ”).

For the year ended December 31, 2018, if the future price of copper fluctuates by + / – 5% (with
the other variables constant), the result would vary + / – US$167 million before taxes as a result
of setting the mark to market of sales revenue to provisional prices in effect as of December 31,
2018 (MTMF 564). For the estimate indicated, all of those physical sales contracts were valued
according to the monthly average immediately following the close of the financial statements, and
proceeds to be estimated regarding what the final settlement price will be if there ¡is a difference

of + / – 5% with respect to the future price known to date for this period.

In order to protect cash flow and adjust, where necessary, its sales contracts to its trade policy,
the Corporation holds operations in futures markets. At the end of the reporting period, these
contracts are adjusted to fair value, recording this effect, at the settlement date of the hedging

transactions as part of net product sales.

As of December 31, 2018, a variation of U.S. £ 1 in the price per pound of copper, considering
derivatives contracted by the Corporation, involves a change in income or payments for existing
contracts (exposures) of US$1.7 million before taxes. This calculation is obtained from a
simulation curves of future copper prices, which are used to assess the subscribed derivative
instruments by the Corporation; estimations would vary with respect to the exposure related these

instruments if there is an increase of U.S. $0.01 decrease in the price per pound of copper.

The Corporation has not entered into any hedging transactions with the specific purpose of

hedging the price risk caused by fluctuations in prices of production inputs.

Cc. Liquidity risk

The Corporation ensures that it has sufficient resources, such as pre-approved credit lines (including
refinancing), in order to meet short-term requirements, after considering the necessary working capital

for its operations and any other commitments it has.

In this sense, Codelco Chile maintains resources at its disposal sufficient to meet its obligations,

whether in cash, liquid financial instruments or credit facilities.

In addition, the Finance Department constantly monitors the Corporation’s cash flow projections based
on short and long term projections and available financing alternatives. In addition, the Corporation
estimates that it has enough headroom to increase the level of borrowing for the normal requirements

of its operations and investments established in its development plan.
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

In this context, according to current existing commitments with creditors, the cash requirements to
cover financial liabilities classified by maturity and presented in the statement of financial position are
detailed as follows:

Maturity of financial liabilities as of Less than Between one More than
12/31/2018 one year and five years five years
ThUS$ ThUS$ ThUS$

Loans from financial institutions 404,871 1,225,961 881,117
Bonds 435,429 2,479,715 9,830,592
Finance leases 21,510 59,777 26,552
Derivatives 10,096 – 106,824
Other financial liabilities 371 63,972 –
Total 872,277 3,829,425 10,845,085

d. Credit risk

This risk comprises the possibility that a third party does not fulfill its contractual obligations, thereby
causing a loss for the Corporation.

Given the Corporation’s sales policy, principally with cash and advance payments and bank letters of
credit, the uncollectability of client debt balances is minimal. This is complemented by the familiarity
the Corporation has with its clients and the length of time it has operated with them. Therefore, the
credit risk of these transactions is not significant.

The indications with respect to the payment conditions to the Corporation are detailed in every sales
contract and the negotiation management is under the charge of the Vice Presidency of Marketing.

In general, the Corporation’s other accounts receivable have a high credit quality according to the
Corporation’s evaluations, based on each debtor’s solvency analysis and payment history.

The maximum exposure to credit risk as of December 31, 2018 is represented by the financial asset
items presented in the Corporation’s Statement of Financial Position.

The Corporation’s accounts receivable do not include customers with balances that could be classified
as a significant concentration of debt and would represent a material exposure for Codelco. This
exposure is distributed among a large number of clients and other counterparties.

In the customer items, the provisions, which are not significant, are included based on the review of
the outstanding balances and characteristics of the clients, destined to cover eventual insolvencies.

In explanatory note 2, trade and other receivables presents past due balances that have not been
impaired.

101
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The Corporation estimates that unimpaired amounts overdue over 30 days are recoverable based on
clients’ historical payment behavior and their existing credit ratings.

As of December 31, 2018 and 2017, there are no receivable balances that have been renegotiated.
Codelco works with major banks, which have high national and international ratings, and continually
assesses them; therefore, the risk that could affect the availability of the Corporation’s funds and
financial instruments is not significant.

Also, in some cases, to minimize credit risk, the Corporation has contracted credit insurance policies
through which it transfers to third parties the commercial risk associated with some aspects of its
business.

During the years ended December 31, 2018 and 2017, no guarantees have been executed to ensure
the collection of third party debt.

Personnel loans mainly related to mortgage loans, according to programs included in union
agreements, which are paid for through payroll discounts.

30. Derivatives contracts

The Corporation has entered into transactions to hedge cash flows, to minimize the risk of foreign exchange
rate variations and sales price variations, detailed as follows:

a. Hedges

The Corporation has taken measures to protect itself from exchange rate and interest rate variations,
where the positive fair value of such derivative, net of taxes, amounts to ThUS$27,346.

The following table summarizes the financial hedges contracted by the Corporation:

December 31, 2018

Financial

Type of cn Fair value of
¡ ivat , obligation: . o
Hedged ¡tem Bank derivative | Maturity_ | Currency | Amount [94 hedging Asset Liability
contract COn9 Il nstruments
instrument
ThUS$ ThUS$ TRUS$ ThUS$ ThUS$
Bond UF Mat 2025 — [Credit Suisse (USA) Swap 4/1/2025 US$ 273.765 208.519 84.365 334.180 | (249.815)
Bond EUR Mat 2024 [Santander (Chile) Swap 7/9/2024 US$ 343.170 409.650 (63.592) 338.339 | (441.931)
Bond EUR Mat 2024 |Deusiche Bank (England) Swap 7/9/2024 US$ 343.170 409.680 (63.170) 388.339 | (441.509)
Bond UF Mat 2026 [Santander (Chile) Swap 8/24/2026 | US$ 396.761 406.212 23.335 458.627 | (435.292)
Total 1.356.866 | 1.434.061 938 1.596.485 | (1.568.547)

102
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

December 31, 2017

Type of Financial Fair value of
Hedged item Bank derivative | Maturity Currency | Amount obligation: hedging Asset Liability
contract hedging instruments
instrument
ThUus$ ThUus$ ThUus$ ThUus$ ThUus$
Bond UF Mat 2025 |Credit Suisse (USA) Swap 4/1/2025 US$ 300.784 208.519 101.158 361.056 (259.898)
Bond EUR Mat. 2024 |Santander (Chile) Swap 7/9/2024 US$ 360.708 409.650 (88.485) 415.241 (453.726)
Bond EUR Mat. 2024 |Deustche Bank (England) Swap 7/9/2024 US$ 360.708 409.680 (37.989) 415.241 (453.230)
Bond UF Mat 2026 |Santander (Chile) Swap 8/24/2026 US$ 435.919 406.212 36.387 483.784 (447.397)
Total 1.356.866 1.434.061 61.071 1.675.322 | (1.614.251)

As of December 31, 2018, the Corporation does not maintain margin deposits.

The current methodology for valuing currency swaps is to use the bootstrapping technique from the
mid – swap rate to construct the curves (zero) in UF and US$ respectively, from market information.

The notional amounts are detailed below:

Notional amount of contract with final expiration date
More than 90
Less than 90 days Current total 1 to 3 years 3to5 years More than 5 years| Non-currenttotal
December 31, 2018 Currency days
ThUS$ ThUS$ Thus$ ThUS$ ThUS$ ThUS$ Thus$
Currency derivative US$ 13,156 44,290 57,446 114,892 114,892 1,525,989 1,755,773

b. Cash flows hedging contracts and commercial policy adjustment

The Corporation enters into metals hedging activities. Such results increase or decrease the total sales
revenue based on the market prices of the metals. As of December 31, 2018, these operations generated

a gain of ThUS$29,414.

b.1. Commercial flexibility operations of copper contracts

The purpose of these contracts is to adjust the price of shipments to the price defined in the
Corporation’s related policy, defined in accordance with the London Metal Exchange (LME). As of
December 31, 2018, the Corporation performed derivative market transactions of copper that
represent 420,850 metric tons of fine copper. These hedging operations are performed as part of
the Corporation’s commercial policy.

The current contracts as of December 31, 2018, present a positive fair value of such derivatives of
ThUS$53,518 and their final result will only be known at their maturity, offsetting the hedging
transactions with revenue from the sale of the hedged products.

The transactions settled as of period ended December 31, 2018 resulted in a net positive effect on

net income of ThUS$29,351, which is comprised of the amounts received for sales contracts for
ThUS$23,588 and the values paid for purchases contracts for ThUS$5,763.

103

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

b.2.

b.3.

Commercial Transactions of Current Gold and Silver Contracts

As of December 31, 2018, the Corporation maintains derivative contracts for the sale of gold for
ThOZT 22.09 and silver for TROZT 327.48.

The contracts outstanding as of December 31, 2018 show a negative fair value of ThUS$671. The
final result will only be known at the expiration of such operations, after offsetting between hedging
and income from the sale of the goods. These hedging operations expire up until April 2019.

The operations completed between January 1 and December 31, 3018, generated a positive effect
on results of ThUS$63, corresponding to values per physical sales contracts for a positive amount
of ThUS$64 and securities for contracts physical purchases for a negative amount of ThUS$1.
Cash flow hedging operations backed by future production

The Corporation does not possess cash flow hedges backed by future production as of December
31, 2018.

104
CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)

(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

b.4. Quantitative effects for metal hedging activities

The following tables set forth the maturities of metal hedging activities, as referred to in point b

above:
December 31, 2018 Maturity date
ThUS$ 2019 2020 2021 2022 2023 Upcoming Total
Flex Com Cobre (Asset) 43,539 13,969 993 – – 58,501
Flex Com Cobre (Liability) (56) (62) – – – (118)
Flex Com Gold/Silver (671) – – – – (671)
Price setting – – – – –
Metal options – – – – – –
Total 42,812 13,907 993 – – 57,712
December 31, 2017 Maturity date
ThUS$ 2018 2019 202 2021 2022 Upcoming Total

Flex Com Cobre (Asset) – 855 – – – 855
Flex Com Cobre (Liability) (2,582) (2,598) (474) – – (5,655)
Flex Com Gold/Silver (527) – – – – (527)
Price setting – – – – –
Metal options – – – – – –
Total (3,109) (1,743) (474) – – (5,326)
December 31, 2018 Maturity date

ThTM/Ounces 2019 2020 2021 2022 2023 Upcoming Total
Copper Futures [MT] 300.10 110.45 10.30 – 420.85
Gold/Silver Futures [ThOZ] 349.57 – – 349.57
Copper price setting [MT] – – –
Copper Options [MT] – – –
December 31, 2017 Maturity date

ThTM/Ounces 2018 2019 2020 2021 2022 Upcoming Total
Copper Futures [MT] 282.60 71.35 5.10 – 359.05
Gold/Silver Futures [ThOZ] 93.20 – – 93.20
Copper price setting [MT] – – –
Copper Options [MT] – – –

31. Contingencies and restrictions

a) Litigations and contingencies

There are various lawsuits and legal actions initiated by or against the Corporation, which derive from its
operations and the industry in which ¡it operates. In general, these are civil, tax, labor and mining
litigations, all related to the Corporation’s activities.

105
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

In the opinion of Management and its legal advisors, the lawsuits where the Corporation is being sued
and could have negative results do not represent significant loss contingencies or cash flows. Codelco
defends its rights and employs all corresponding relevant legal instances, resources and procedures.

The most significant lawsuits that involve Codelco are related to the following matters:

– Tax proceedings: There is a tax proceeding for liquidation No.141 of tax year 2015 and
Exempt Resolution No. 89 of 2016 issued by the Internal Revenue Service (SI), for which the
Corporation presented the corresponding appeals, which were received and resolved in favor of the
Tax and Customs Courts, a resolution that was appealed by the SI!.

– Labor proceedings: Labor proceedings brought by the workers of the Andina Division against the
Corporation with regard to occupational diseases (silicosis).

– Mining proceedings and others arising from the Operation: The Corporation has been participating,
and will probably continue to participate, as plaintiff and defendant in given court proceedings
involving its mining operation and activities, through which it seeks to exercise certain actions or set
up certain defenses in relation to given mining concessions that have been established or are in the
process of being established, as well as also with regard to its other activities. These proceedings
currently do not involve any given amount and do not have any essential effect on Codelco’s
development.

– Asof December 31, 2018, the total of lawsuits filed against the National Corporation of the Copper
amounts to ThUS$103,378, which represents the estimate made by the legal advisors of the
Corporation subject to consideration under IAS 37. An analysis, case by case, has revealed that
there is a total of 358 causes with an estimated amount of ThUS$103,378, of which, 248 causes that
represent 69.27% of the universe, and that amounts to ThUS$69,334 (judgments reported as
probable and possible loss for the Corporation), which could have a negative result for the
Corporation. There are also 44 causes, which represent a 12.29% for an amount of ThUS$33,444,
over which there is no security that its failure be contrary to the Corporation. For the remaining 66
cases, for an amount of TRUS$ 600 legal advisors of the Corporation estimate that the probability of
loss is remote.

– Lawsuit under administrative law: On August 2, 2017, a Nullity in Public Law claim was filed in the
25th Civil Court of Santiago against Audit Report No. 900 of 2016, issued by the General
Comptrollership of the Republic on May 10, 2017. At this date, the discussion stage has been
completed and the evidence submitting stage should start soon.

For litigations with a probable unfavorable outcome for the Corporation, the necessary provisions has
been recognized as “provisions for legal proceedings.”

106
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

b) Other Commitments

On May 31, 2005, Codelco, through its subsidiary Codelco International Ltd. signed an agreement
with Minmetals to form a company, CuPIC, in which both companies have an equal equity interest.
A 15-year copper cathode sales contract to that associated company was agreed upon, as well as
a purchase contract from Minmetals to CupiCfor the same period and for equal monthly shipments
to complete a total of 836,250 metric tons. Each shipment shall be paid for by the buyer at a price
formed by a fixed re-adjustable component plus a variable component, which depends on current
copper prices at the time of shipment.

During the first quarter of 2006 and on the basis of the negotiated financial terms, financing contracts
were formalized with the China Development Bank allowing CuPIC to make the US$550 million
advance payment to Codelco in March 2006.

With regard to financial obligations incurred by the associate CuPIC with the China Development
Bank, Codelco Chile and Codelco International Ltd, must meet certain commitments, mainly relating
to the delivery of financial information. In addition, Codelco Chile must maintain 51% ownership of
Codelco International Limited.

According to the Sponsor Agreement, dated March 8, 2006, the Codelco International Ltd.
subsidiary gave its participation in CuPIC as a guarantee to the China Development Bank.

Subsequently, on March 14, 2012, CUuPIC paid off its debt to the abovementioned bank. As of
December 31, 2017. Codelco does not hold any indirect guarantee regarding its participation in this
associated company.

On December 17, 2015, the Codelco administration presented a restructuring for the Supply
Contract, which implies the removal of its share in CUPIC.

On April 7, 2016, the Corporation formalized the removal of ¡ts share in CUPIC, of which Codelco
retained 50% ownership through the subsidiary Codelco International. Until that date, Codelco
shared the ownership of the Company in the same proportion with the company Album Enterprises
Limited (a subsidiary of Minmetals).

In order to realize the above mentioned term of the shareholding, Codelco signed a set of
agreements which formalized primarily the following issues:

+ Copper sales contract modifications from Codelco to CUPIC signed in 2006, which establishes
the reduction of half of the outstanding tonnage to deliver to this company and in which Codelco
pays to CUPIC the amount of ThUS$99,330.

+ Reduction of share capital in CuPIC, equivalent to the 50% of the Codelco International shares
in said company and by which CuPIC repays to Codelco the amount of ThUS$99,330.

107
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

+ Waiver of Codelco to any dividends associated with the profits generated by CuPIC from January
1, 2016 and the date of signing the agreement.

* Additionally, the cessation of dividends reception as a consequence of the removal of the
Codelco share in the ownership of CuPIC since 2016, led to a reduction of the net profit
estimated to Codelco until the end of the contract signed with that company (year 2021). This
implied that such contract qualifies as an onerous contract, according to IAS 37, which negatively
impacts on earnings before tax of Codelco in ThUS$22,184 (negative net tax effect of
ThUS$6,599 as of April 7, 2016).

Regarding the financing agreement signed on August 23, 2012, between the subsidiary, Gacrux
Inversiones SpA and Mitsui 3, Co. Ltd. for the acquisition of the 24.5% stake in Anglo American Sur
S.A. which was subsequently amended on October 31, 2012, a pledge is included over the shares
that the subsidiary has on Acrux Inversiones SpA (shared participation with Mitsui and minority
shareholder in Anglo American Sur S.A.), in order to ensure compliance with the obligations that
the financial agreement contemplates.

This pledge extends to the right to collect and receive from Acrux dividends which have been agreed
in the corresponding meetings of shareholders of the company and any other distributions paid or
payable to Gacrux respect of the pledged shares.

On December 22, 2017 according to archive No. 12326 / 2017, itwas established that, Gacrux,
the Creditor and the Guarantee Agent, the latter representing the Guaranteed Parties, modified , by
virtue of the Merger (see Note 2d), the Contract of Pledge and the Modified Pledge Agreement as
to the pledge on transferable securities and the commercial pledge, as well as the restrictions and
prohibitions established in the Pledge Contract and in the Modified Pledge Contract, making it
subject to , by virtue of the Merger, to two thousand thirteen million two hundred and forty-five
thousand four hundred and seventy-three shares pledge issued by Becrux, owned by Gacrux,
hereinafter the “Pledged Becrux Shares.”

Law 19.993 dated December 17, 2004, authorized the purchase of the Refinery and Smelter Las
Ventanas assets from ENAMI, establishing that the Corporation must ensure that the smelting and
refining capacity required is maintained, without any restriction and limitation, for treating the
products of the small and medium mining sector sent by ENAMI, under the form of toll production
or another form agreed upon by the parties.

Obligations with the public for bond issues means that the Corporation must meet certain restrictions
related to limits on pledges and leaseback transactions on its principal assets and on its ownership
interest in subsidiaries.

The Corporation has complied with these conditions as of December 31, 2018 and 2017.

On January 20, 2010, the Corporation signed two energy supply contracts with Colbún S.A., which
includes energy and power sales and purchases for a total of 510 MW of power. The contract

108
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

vi.

vil.

viii.

provides a discount for that unconsumed energy Codelco’s SIC divisions with respect to the amount
of contracted power. The discount is equivalent to the value of the sale of that energy on the spot
market.

The contracted power for supplying these Divisions is comprised by two contracts:

– Contract No.1 for 176 MW, current until December 2029

– Contract No.2 for 334 MW, current until December 2044. This contract is based on energy
production from Colbún’s Santa María thermal power station, which is currently in operation.
This plant is coal-fired, and therefore the electric energy tariff rate applied for the energy supplied
to Codelco is linked to the price of coal.

Both of these contracts comply with Codelco’s long-term energy and power requirements from the
SIC of approximately 510 MW.

Through these contracts, which operate through take or pay, the Corporation agrees to pay for the
contracted energy and Colbún undertakes to reimburseat market price the energy not consumed
by Codelco.

These contracts have maturity date in 2029 and 2044.

On November 6, 2009, Codelco signed the following long-term electric energy supply contracts with
ELECTROANDINA S.A. (associate until January 2011), which matured in August 2017.

For the electric power supply of the Chuquicamata’s work center, there are three contracts:
– — Engie for a 15-year term from January 2010, that is maturing in December 2024, for 200
MW capacity, and another contract for a 200 MW capacity which was signed in January
2018 and will be effective as of January 2025 with maturity in December 2035.
– CTA effective from 2012 for 80 MW capacity, maturity in 2032.

On August 26, 2011, Codelco signed two energy supply contracts with AESGener. The first one for
the Minister Hales division for a 99 MW capacity and the second contract for the Radomiro Tomic
work center, for a maximum capacity of 145 MW. Both contracts will mature in 2028.

On November 11, 2011, Law No. 20551 was published in the Official Journal, which regulates the
tasks and closure of mining facilities. Additionally, on November 22, 2012, the Supreme Decree No.
41 of the Minister of Mining, which approves the Regulations of this Law, was published in the Diario
Oficial.

This law requires the Corporation, among other requirements, to provide financial guarantees to the

State to ensure the implementation of closure plans. It also establishes the obligation to make
contributions to a fund which aims to cover the costs of post-closure activities.

109
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

The Corporation, in accordance with the mentioned regulation, provided to SERNAGEOMIN the
Mine Closure Plan (ARO) for all of the Codelco operating divisions in 2014, which were approved
in 2015 in accordance with the provisions of the Act.

The mine closure plans delivered to SERNAGEOMIN were developed by invoking the transitional
regime of the Act, which was specified for the affected mining companies under the general
application procedure (extraction capacity > 10,000 tons per month), and which, at the date of
enactment of the Law, will abide in operation and move forward with a mine closure plan previously
approved under Mine Safety Regulations Supreme Decree No. 132.

The Corporation considers that the accounting liability recorded caused by this obligation differs
from the law’s requirement, mainly by differences concerning the horizon that is considered for the
projection of flows, in which the law requires the determination of the obligations in terms of mineral
reserves, while the financial-accounting approach incorporates some of its mineral resources.
Therefore, the discount rate established by law, may differ from that used by the Corporation under
the criteria set out in lAS 37 “Provisions, Contingent Liabilities and Contingent Assets” and
described in Note 2, letter p) of Main Accounting Policies.

As of December 31, 2018, the Corporation has agreed guarantees for an annual amount of U.F.
27,058,918 to comply with the aforementioned Law No. 20.551. The following table details the main
given guarantees:

. . . . Emission
Transmitter Mine site Amount Currency Date Maturity date rate % ThUS$
Banco Estado Radomiro Tomic 2,691,723 UF 11/30/2018 11/11/2019 0.08 106,797
Banco Estado Ministro Hales 911,821 UF 11/29/2018 11/14/2019 0.08 36,178
Banco Chile Ministro Hales 541,257 UF 12/6/2018 11/14/2019 0.10 21,475
Banco Chile Chuquicamata 2,300,000 UF 12/5/2018 11/27/2019 0.10 91,255
Banco Bci Chuquicamata 4,600,000 UF 11/30/2018 11/27/2019 0.15 182,510
Banco ltau Chuquicamata 915,319 UF 27/12/2018 11/27/2019 0.16 36,316
Banco Chile El Teniente 2,632,299 UF 12/5/2018 12/2/2019 0.10 104,439
Banco Santander El Teniente 5,000,000 UF 12/20/2018 12/2/2019 0.15 198,381
Banco Estado Gabriela Mistral 1,513,907 UF 11/29/2018 12/15/2019 0.08 60,066
Banco ltau Gabriela Mistral 278,180 UF 6/6/2018 6/13/2019 0.15 11,037
Banco ltau Salvador 2,674,603 UF 8/8/2018 2/18/2019 0.10 106,118
Banco Estado Andina 2,666,740 UF 10/29/2018 5/3/2019 0.07 105,806
Banco Chile Ventanas 333,069 UF 12/13/2018 9/19/2019 0.07 13,215
Total 27,058,918 1,073,593

On August 24, 2012, Codelco through its subsidiary Inversiones Mineras Nueva Acrux SpA (Nueva
Acrux) (which minority shareholder is Mitsui), signed a contract with Anglo American Sur S.A. Under
this contract, Codelco agreed to sell a portion of its annual copper production to the mentioned
subsidiary, who in turn agrees to purchase such production.

110
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Such annual portion is determined by the share of Codelco’s indirect subsidiary, Inversiones
Mineras Becrux SpA (also shared ownership with Mitsui), maintained for the shares of Anglo
American Sur S.A.

In turn, the subsidiary Nueva Acrux agrees to sell to Mitsui, the products purchased under the
agreement described in the preceding paragraphs.

The contract expiration will occur when the shareholders agreement of Anglo American Sur S.A
ends or other events related to the completion of mining activities of the company take place.

32. Guarantees
The Corporation as a result of its activities has received and given guarantees.

The following tables list the main guarantees given to financial institutions:

111
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Direct Guarantees provided to Financial Institutions
Creditor of the Guarantee Type of Guarantee 12/31/2018 12/31/2017
Currency Maturity ThUs$ ThUS$
Urban Regional Manager, Metropolitan Building project UF 3/31/18 – 10
Urban Regional Manager, Metropolitan Building project UF 8/31/18 – 10
Minestry of Public Works Building project US$ 6/27/18 – 209
General Directorate of Maritime Territory and Merchant | Building project CLP 3/1/19 1,783 –
Marine
Minestry of Public Works Building project UF 10/31/18 – 25,339
Minestry of Public Works Building project UF 10/31/18 – 28,399
Minestry of Public Works Building project UF 10/1/19 566 566
Oriente Copper Netherlands B.V. Pledge on shares US$ 11/1/32 877,813 877,813
Sernageomin Environmental UF 11/3/18 – 139,589
Sernageomin Environmental UF 3/18/18 – 13,156
Sernageomin Environmental UF 5/10/18 – 106,936
Sernageomin Environmental UF 5/10/18 – 57,302
Sernageomin Environmental UF 6/1/18 – 104,598
Sernageomin Environmental UF 6/1/18 – 199,215
Sernageomin Environmental UF 6/14/18 – 60,716
Sernageomin Environmental UF 5/26/18 – 118,924
Sernageomin Environmental UF 5/26/18 – 156,804
Sernageomin Environmental UF 5/26/18 – 24,526
Sernageomin Environmental UF 8/31/8 – 119,414
Sernageomin Environmental UF 8/31/8 – 852
Sernageomin Environmental UF 3/18/19 17,920 –
Sernageomin Environmental UF 5/9/19 137,355 –
Sernageomin Environmental UF 6/13/19 73,210 –
Sernageomin Environmental UF 6/13/19 11,980 –
Sernageomin Environmental UF 6/1/19 110,322 –
Sernageomin Environmental UF 6/1/19 273,875 –
Sernageomin Environmental UF 5/25/19 192,789 –
Sernageomin Environmental UF 5/25/19 103,290 –
Sernageomin Environmental UF 5/12/19 39,150 –
Sernageomin Environmental UF 5/12/19 38,215 –
Sernageomin Environmental UF 5/25/19 96,395 –
Total 1,974,663 2,034,381

As for the documents received as collateral, they cover mainly obligations of suppliers and contractors
related to the various development projects. Below are given the amounts received as collateral, grouped
according to the Operating Divisions that have received these amounts:

112
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Guarantees received from third parties
A 12/31/2018 12/31/2017
Division
ThUS$ ThUS$

Andina 3,891 8,228

Chuquicamata 2,445 7,614

Casa Matriz 803,719 737,160

Salvador 1,311 7,295

Ministro Hales – 6

El Teniente 4,137 19,064

Ventanas 105 778

Total 815,608 780,145

33. Balances in foreign currency
a) Assets by Type of Currency
Catego 12/31/2018 12/31/2017
soy ThUS$ ThUS$

Liquid assets 1,460,534 1,450,162
US Dollars 1,383,897 1,378,521
Euros 25,482 3,472
Other currencies 4,547 4,245
Non-indexed Ch$ 46,129 63,002
UE. 479 922
Cash and cash equivalents 1,229,125 1,448,835
US Dollars 1,152,715 1,378,247
Euros 25,482 3,472
Other currencies 4,547 4,245
Non-indexed Ch$ 46,109 62,779
UE. 272 92
Other current financial assets 231,409 1,327
US Dollars 231,182 274
Euros – –
Other currencies – –
Non-indexed Ch$ 20 223
UE. 207 830
Short and long term receivables 2,409,835 2,996,968
US Dollars 1,789,757 2,473,589
Euros 62,857 59,297
Other currencies 320 1,625
Non-indexed Ch$ 482,180 406,589
UE. 74,721 55,868
Trade and other receivables 2,212,209 2,815,352
US Dollars 1,676,862 2,383,415
Euros 62,580 57,992
Other currencies 320 1,625
Non-indexed Ch$ 398,966 317,819
UE. 73,481 54,501

113
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Category 12/31/2018 12/31/2017
ThUS$ ThUS$
Rights receivables, non-current 84,731 91,442
US Dollars – –
Euros 217 1,305
Other currencies – –
Non-indexed Ch$ 83,214 88,770
UE. 1,240 1,367
Due from related companies, current 92,365 64,344
US Dollars 92,365 64,344
Euros – –
Other currencies – –
Non-indexed Ch$ – –
UE. – –
Due from related companies, non-current 20,530 25,830
US Dollars 20,530 25,830
Euros – –
Other currencies – –
Non-indexed Ch$ – –
UE. – –
Rest of assets 33,220,436 31,909,011
US Dollars 32,171,442 31,025,279
Euros 705 26,952
Other currencies 279 367
Non-indexed Ch$ 377,119 119,690
UE. 670,891 736,723
Total assets 37,090,805 36,356,141
US Dollars 35,345,096 34,877,389
Euros 89,044 89,721
Other currencies 5,146 6,237
Non-indexed Ch$ 905,428 589,281
UE. 746,091 793,513

114
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

b) Liability by type of currency:

12/31/2018 12/31/2017
Current liability by currency Up to 90 days 90 days to 1 year Up to 90 days 90 days to 1 year
ThuS$ Thus$ ThUS$ ThuS$
Current liabilities 3,049,854 489,558 3,126,371 189,085
US Dollars 1,824,181 452,648 1,821,173 150,417
Euros 107,341 408 119,851 –
Other currencies 9,826 – 9,668 –
Non-indexed Ch$ 1,088,536 31,419 1,155,722 32,964
UE. 19,970 5,083 19,957 5,704
Other current financial liabilities 412,451 459,826 166,557 157,831
US Dollars 396,148 452,635 124,107 150,402
Euros 7,404 408 32,182 –
Other currencies 34 – – –
Non-indexed Ch$ 879 1,700 1,269 1,725
UE. 7,986 5,083 8,999 5,704
Bank loans 5,739 399,132 26,819 103,908
US Dollars 5,683 398,724 2,223 103,908
Euros – 408 24,400 –
Other currencies – – – –
Non-indexed Ch$ – – – –
UE. 56 – 196 –
Obligations 401,174 34,255 134,864 30,920
US Dollars 387,578 34,255 120,277 30,920
Euros 7,404 – 7,782 –
Other currencies – – – –
Non-indexed Ch$ – – – –
UE. 6,192 – 6,805 –
Finance lease 5,167 16,343 3,888 12,476
US Dollars 2,887 9,560 1,347 5,047
Euros – – – –
Other currencies – – – –
Non-indexed Ch$ 542 1,700 543 1,725
UE. 1,738 5,083 1,998 5,704
Others 371 10,096 986 10,527
US Dollars – 10,096 260 10,527
Euros – – – –
Other currencies 34 – – –
Non-indexed Ch$ 337 – 726 –
UE. – – – –
Other current liabilities 2,637,403 29,732 2,959,814 31,254
US Dollars 1,428,033 13 1,697,066 15
Euros 99,937 – 87,669 –
Other currencies 9,792 – 9,668 –
Non-indexed Ch$ 1,087,657 29,719 1,154,453 31,239
UE. 11,984 – 10,958 –

115
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

12/31/2018 12/31/2017
Non-current liability by currency 1to3 3to5 5to 10 More than 1to3 3to5 5to 10 More than
years years years 10 years years years years 10 years
Thus$ Thus$ Thus$ Thus$ Thus$ Thus$ Thus$ Thus$
Non-Current liabilities 6,804,312 2,260,258 5,142,419 8,000,535 6,200,324 2,773,522 5,534,293 7,607,208
US Dollars 6,396,888 2,114,245 4,160,204 6,918,087 5,755,523 2,619,881 4,461,270 6,501,948
Euros 14 – (7,832) – 89 – (9,682) –
Other currencies 1 – – – 1 – – –
Non-indexed Ch$ 390,088 141,392 277,356 505,603 423,022 148,258 291,395 527,887
UF 17,321 4,621 712,691 576,845 21,689 5,383 791,310 577,373
Other non-current financial liabilities 1,710,559 2,118,866 4,847,087 5,997,998 1,349,908 2,625,264 5,226,237 5,446,595
US Dollars 1,702,164 2,114,245 4,142,228 5,997,998 1,334,855 2,619,881 4,444,609 5,446,595
Euros – – 7,832 – – – (9,682) –
Other currencies – – – – – –
Non-indexed Ch$ 219 – – – 2,996 – –
UF 8,176 4,621 712,691 – 12,057 5,383 791,310 –
Bank loans 548,454 677,507 298,250 582,867 406,167 1,297,133 – 626,357
US Dollars 548,454 677,507 298,250 582,867 406,103 1,297,133 – 626,357
Euros – – – – – – –
Other currencies
Non-indexed Ch$ –
UF – – – – 64 – – –
Obligations 1,065,419 1,414,296 4,415,461 5,415,131 847,944 1,313,161 5,102,279 4,820,238
US Dollars 1,065,419 1,414,296 3,034,864 5,415,131 847,944 1,313,161 3,613,723 4,820,238
Euros – – 678,446 – – – 711,734 –
Other currencies – –
Non-indexed Ch$ – – – – –
UF – – 702,151 – – – 776,822
Finance Lease 32,714 27,063 26,552 – 26,970 14,970 44,407
US Dollars 24,322 22,442 16,012 – 11,981 9,587 29,919
Euros – – – – – –
Other currencies – – – – –
Non-indexed Ch$ 216 – – – 2,996 – –
UF 8,176 4,621 10,540 – 11,993 5,383 14,488
Others 63,972 – 106,824 – 68,827 – 79,551
US Dollars 63,969 – 793,102 – 68,827 – 800,967
Euros – – (686,278) – – – (721,416)
Other currencies – – –
Non-indexed Ch$ 3
UF – – – – – – – –
Other liabiliies non-current 5,093,753 141,392 295,332 2,002,537 4,850,416 148,258 308,056 2,160,613
US Dollars 4,694,724 – 17,976 920,089 4,420,668 – 16,661 1,055,353
Euros 14 – – 89 – –
Other currencies 1 – – – 1 – – –
Non-indexed Ch$ 389,869 141,392 277,356 505,603 420,026 148,258 291,395 527,887
UF 9,145 – – 576,845 9,632 – – 577,373

34. Sanctions

As of December 31, 2018 and December 31, 2017, neither Codelco Chile nor its Directors and Managers
have been sanctioned by the CMF or any other administrative authorities.

35. Environmental Expenditures

Each of Codelco’s operations is subject to national, regional and local regulations related to protection of
the environment and natural resources, including standards relating to water, air, noise and disposal and
transportation of dangerous residues, among others. Chile has introduced environmental regulations that
have obligated companies, including Codelco, to carry out programs to reduce, control or eliminate relevant
environmental impacts. Codelco has executed and shall continue to execute a series of environmental
projects to comply with these regulations.

116
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Pursuant to the Letter of Values approved in 2010, Codelco is governed by a series of internal policies and
regulations that frame ¡ts commitment to the environment, including the Sustainable Development Policy
(2003) and the Corporate Security, Occupational Health and Environmental Management Policy (2007).

The environmental management systems of the divisions and the Head Office, structure their efforts in order
to comply with the commitments assumed by the corporation’s environmental policies, incorporating
planning, operating, verifying and reviewing elements. As of December 31, 2018, they have received ISO
14001 certification for the environmental management of Chuquicamata, Radomiro Tomic, Andina,
Salvador, El Teniente, Ventanas, Gabriela Mistral and the Head Office.

In accordance with Supreme Decree D.S. No. 28, the Corporation is carrying out is environmental,
maintenance and operating plans for its smelting plants.

To comply with the Circular No. 1901 of 2008 of the CMF, the details of the Corporation’s main expenditures

related to the environment during the years ended December 31, 2018 and 2017, respectively, and the
projected future expenses are stated below.

117
CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Disbursements 12/31/2018 wa13alzor | Future committed
disbursements
Entity Proyect name Y
Amount | Asset ” Amount | Amount | Estimated
Proyectstatus | muss | menso | Benditure | Cayos | muss Ene
Item
Chuquicamata 492,963 300,883 | 479,386
Codelco Chile. |Talambre dam capacity extension, 8h stage In Progress 148,715 | — Asset PP EE 8e7sr | 131,287 | — 2020
Codelco Chile [Emergency restoraton system dust control crushing plant 2/3. | — In Progress 345 | — Asset PP EE 6114 – –
Codelco Chile. [Replacement of circulation pot 1A and 2A In Progress 4,3370 | — Asset PP EE 21407] 15717| 2019
Codelco Chile. [Construction installaton surplus management In Progress | Asset PP EE 6,644 – –
Codelco Chile [Replacement of water treaiment plant In Progress | Asset PP EE 24,318 – –
Codelco Chile. [Replacement gas management system In Progress 745 | — Asset PP EE so] 1040| 2019
Codelco Chile [Acid plant tranformaton 3-4 DC/DA In Progress 200,844 | — Asset PP EE 115588 | 108,863 | — 2019
Codelco Chile. [Enablement refning gas treatment system In Progress 26,973 | — Asset PP EE 10,163] 47122 | 2019
Codelco Chile. [Dyer replacement * 5fuco In Progress 28,204 | — Asset PP EE 1er | 36257 | 2019
Codelco Chile. [Management feeding and transport pow ders In Progress 1,368 | — Asset PP EE 620 – –
Codelco Chile. [Construction Relle Res Dom-Asim Montec In Progress 509 | Asset PP EE 2| te] 2019
Codelco Chile. [Construction lX stage Talambre tranque In Progress 6.063 | — Asset PP EE Te] 11259] 2019
Codelco Chile. — [Construction 8 Seg Montecristo In Progress 799 | — Asset PP EE o] 16560] 2019
Codelco Chile [Acid plants In Progress 30,980 | Expenditure | Adm. Expense | — 23,014 | 20m
Codelco Chile [Solid waste In Progress 6,505 | Expenditure | Adm. Expense 1,707 | 20m
Codelco Chile — [Talings In Progress 28,047 | Expenditure | Adm. Expense 15,474 | 20m
Codelco Chile. [Water reaiment plant In Progress 17,501 | Expenditure | Adm. Expense 14,849 | 20m
Codelco Chile — [Environmental monitoring In Progress 3,811 | Expenditure | Adm. Expense 796 | 20m
Salvador 138,153 110,683 | — 167,627
Codelco Chile. [mproved integration of he gas process In Progress 91,755 | — Asset PP EE 76,785 | 100,552 | — 2019
Codelco Chile. [Concentrator fer plant construcion In Progress 28] Asset PP EE 10,994 – –
Codelco Chile. [Water capture improvement In Progress 147 | Asset PP EE 807 – –
Codelco Chile — [Talings In Progress 2,008 | Expenditure | Adm. Expense 2,180 1,006 | — 2019
Codelco Chile [Acid plants In Progress 29,677 | Expenditure | Adm. Expense 18,401 7562 | — 2019
Codelco Chile — [Solid waste In Progress 902 | Expenditure | Adm. Expense 768 304 | 2019
Codelco Chile. [Water reaiment plant In Progress 687 | Expenditure | Adm. Expense 528 486 | 2019
Codelco Chile. [Overhaul hickeners talings sal-proy In Progress 1443 | — Asset PP EE 20] 1rese| 2019
Codelco Chile [Dangerous substances warehouse In Pogress 82| Asset PP EE – 356 | 2019
Codelco Chile [Bell replacement In Pogress 11,185 | — Asset PP EE | 24555 | 2019
Codelco Chile — [Ditoh hazardous waste In Pogress 62| Asset PP EE – 865 | 2019
Codelco Chile. [DRPA Emergency In Pogress 177 | Asset PP EE | 18023 | 2019
Andina 166,793 208,822 | — 59,220
Codelco Chile [Drain water treament Finished 171] Asset PP EE 11,236 – –
Codelco Chile [Water Normatve Phase 2 In Progress 4,274 | — Asset PP EE 4,095 – –
Codelco Chile. [Construction site emergenoy plan In Progress 11,176 | — Asset PP EE 22,127 3500 | 2019
Codelco Chile. [Construction site emergenoy plan Finished 5975 | — Asset PP EE 27,570 – –
Codelco Chile. |mproved water intemal ip E2 In Progress 2,620] — Asset PP EE 2,906 – –
Codelco Chile. [Construction eary alert plan Finished | Asset PP EE 308 – –
Codelco Chile. [mplementaton in RCA compliance well (Hydraulic Barrer) In Progress 3,010| — Asset PP EE 868 – –
Codelco Chile [Catchment water drainage hil black In Progress 2,301 | — Asset PP EE 329 627 | 2019
Codelco Chile. [Construction canal outine DL east In Progress 6,136 | — Asset PP EE sa] 2040] 2020
Codelco Chile [Standard fuel supply system In Progress 258 | — Asset PP EE 18 – –
Codelco Chile. [Construction site emergency plan In Progress 7,942 | — Asset PP EE 6 5115| 2019
Codelco Chile. [Oo Sbr Level 640 Msnm Trang In Progress 16,720 | — Asset PP EE 63,195 – –
Codelco Chile — [Solid waste In Progress 2,735 | Expenditure | Adm. Expense 1,884 746 | 2019
Codelco Chile. [Water reaiment plant In Progress 3,927 | Expenditure | Adm. Expense 2,501 920] 2019
Codelco Chile — [Traling In Progress 68,220 | Expenditure | Adm. Expense | — 50,956] 17485] 2019
Codelco Chile — |Acid drainage In Progress 30,894 | Expenditure | Adm. Expense 17,462 9474 | 2019
Codelco Chile [Environmental monitoring In Progress 554 | Expenditure | Adm. Expense 824 122 | 2019
Codelco Chile [Sustainabilty and external matters management In Progress 2,880 | Expenditure | Adm. Expense 1,462 791 | 2019
Subtotal 797,909 659,388 | 706,233

118

CORPORACION NACIONAL DEL COBRE DE CHILE

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

Disbursements 12/31/2018 wargarzorr | Futurecommitted
disbursements
Entity Proyect name Assetí
Amount | Asset ! Amount | Amount | Estimated
Thus$ Expense | PXPenditure | ysg Thus$ date
ltem
El Teniente 407,794 250,563 | 496,088
Codelco Chile. [Constuction of 71h phase of Carén In Progress 27,866 | — Asset P.P8E 2436 | 280,642 | 2022
Codelco Chile — [Constuction of 6hh phase of Carén Finished | asset P.PEE 7,550 . –
Codelco Chile. [Constucton ofslag treatment plant In Progress 108,854 | — Asset P.PEE a2o19 | 108/225| 2019
Codelco Chile. [Constuction ofslag treatment plant In Progress 19,749 | — Asset P.PEE 23,214 . –
Codelco Chile. |Smeling emissions network In Progress 51,273 | — Asset P.PEE soose| 27997| 2019
Codelco Chile. [Smoke capacity reduction In Progress 5,579 | — Asset P.PEE 2744 | 24,555| 2019
Codelco Chile. [Smoke capacity reduction In Progress 38,749 | — Asset P.PEE 6,693 6862 | 2019
Codelco Chile. [Constuction ofslag treatment plant In Progress 1.660 | — Asset P.PEE 456 2223 | 2019
Codelco Chile |acia plants In Progress 66,294 | Expenditure | Adm. Expense 53204] 18060] 2019
Codelco Chile — [Solid waste In Progress 4,460 | Expenditre | Adm. Expense 3,933 ost] 2019
Codelco Chile. — [Water treatment plant In Progress 16.688 | Expenditure | Adm. Expense 10,962 4332 | 2019
Codelco Chile — |Talings In Progress 66,632 | Expenditure | Adm. Expense 36,305 | 16282 | 2019
Gabriela Mistral 12,126 8,425 | — 47,405
Codelco Chile [Installaton of the rubble dump folder phase VI Finished | asset P.P8E 6,446 . –
Codelco Chile [Installation of the rubble dump folder phase VII Finished | asset P.PEE 262 . –
Codelco Chile. [Replacement three tracked tractors In Progress | asset P.PEE 164 5,753 –
Codelco Chile [Environmental monitoring In Progress 6 | Expendiure | Adm. Expense 46 “| 2019
Codelco Chile — [Solid waste In Progress 2,420 | Expenditre | Adm. Expense 1,441 617| 2019
Codelco Chile. [Environmental consultancy In Progress 2,087 | Expenditre | Adm. Expense 38 30| 2019
Codelco Chile. [Water treatment plant In Progress 106 | Expenditure | Adm. Expense 38 30| 2019
Codelco Chile. [Garbage dump extension In Progress 7,446 | — Asset P.PEE | 40563 | 2020
Codelco Chile — [Improved dust collection system In Progress 51] Asset P.PEE . am] 2020
Ventanas 43,492 40,080 9,783
Codelco Chile. [Capturing of second gases Finished | asset P.P8E 723 . –
Codelco Chile. [Removal ofvisible fumes raf Finished | asset P.PEE 3,612 . –
Codelco Chile. [Fugiive gas treatment Finished | asset P.PEE 3,432 . –
Codelco Chile — [Second gas collection CT Finished | asset P.PEE 3,589 . –
Codelco Chile. [Fugiive gas treatment CT Finished | asset P.PEE 2270 . –
Codelco Chile. [Constuction new warehouse of concentrate In Progress 2072 | Asset P.PEE 5t8 . –
Codelco Chile |acia plants In Progress 30,514 | Expenditure | Adm. Expense 19,483 6530 | 2019
Codelco Chile — [Solid waste In Progress 1.908 | Expenciture | Adm. Expense 1,883 ms | 2019
Codelco Chile — [Environmental monitoring In Progress 1.586 | Expenditure | Adm. Expense 1,088 358 | 2019
Codelco Chile. [Water treatment plant In Progress 5,340 | Expenditure | Adm. Expense 3,482 2,80 | 2019
Codelco Chile [Distribution system replacement In Progress 2.072 | Asset P.PEE . . –
Radomiro Tomic 2,806 1,867 77
Codelco Chile — [Solid waste In Progress 1,132 | Expenditure | Adm. Expense 823 216 | 2019
Codelco Chile — [Environmental monitoring In Progress 725 | Expenditure | Adm. Expense 296 245| 2019
Codelco Chile. [Water treatment plant In Progress 949 | Expenditure | Adm. Expense 748 249| 2019
Ministro Hales 1,529 2,487 12,809
Codelco Chile — [Solid waste In Progress 664 | Expenditure | Adm. Expense 1,377 1.956 | — 2019
Codelco Chile — [Environmental monitoring In Progress 664 | Expenditure | Adm. Expense 572 287 | 2019
Codelco Chile. [Water treatment plant In Progress 180 | Expenditre | Adm. Expense 238 366 | 2019
Codelco Chile [Pitdrainage wells mine In Progress 10] Asset P.PEE . 660 | 2019
Codelco Chile. [Implementation monitoring acuifero pit In Progress 1] Asset P.PEE . 3557 | 2019
Ecometales Limited 62 13 82
Codelco Chile — |Smeling powders leaching plant In Progress 613 | Expenditure | Adm. Expense 515 e7| 2019
Codelco Chile. |Smeling powders leaching plant In Progress 8 | Expendiure | Adm. Expense 216 “| 2019
Subtotal 468,368 303,853 | 557,683
Total 1,266,277 963,241 | 1,263,916

119

CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

36. Subsequent events

– On January 16, 2019, it is reported as an essential fact that Mr. Patricio Chávez Inostroza ceases to
exercise his functions as Vice President of Corporate Affairs and Sustainability of the Corporation and
assuming his duties on an “acting” basis, is, José Pesce Rosenthal who will also maintain the position of
Vice President of Management of Mining Resources and Development, a role he currently exercises.

– On January 28, 2019, it is reported as an essential fact that Codelco issued bonds in New York for USD
1,300 million at 30 years, with an annual rate of 4.375%. This operation will give greater financial flexibility
for it to invest in its structural projects, the first of which, Chuquicamata Subterránea, will start operations
this year. The issue will allow the Corporation to lighten ¡ts profile of debt repayments for the period 2020 –
2025 and extend part of its financial commitments to 30 years, matching the payment dates with the years
in which, in addition to Chuquicamata Subterránea, the New Mine level, Andean Transfer and Inca Rajo
also will be in full production.

With this transaction, Codelco’s net debt is not increased and a new step is taken in a sustainable financing,
according to the guidelines given by the Board of Directors in terms of advancing the realization of structural
projects and maintaining a solid financial position.

In this way, Codelco launched in New York an offer to purchase its bonds issued in dollars with maturities
between 2020 and 2025. The offer of purchase points to two groups of bonds. The first includes those with
expiration in 2020, 2021, and 2022, and was offered for aggregate amount of up to US$1,907 million, which
corresponds to the total maturities of those papers.

These activities were led on this occasion by HSBC Securities (USA) Inc., JP Morgan Securities
LLC, Citigroup Global Markets Inc., and Scotiabank.

The impact on results associated with this refinancing, reached an estimated loss after taxes of US$14
million.

– On February 1, 2019, it is reported as essential fact, the withdrawal from the Corporation of Mr. Ricardo
Montoya Peredo, General Manager of the Gabriela Mistral Division; and, on an “acting” basis, Mr. Gustavo
Cordova Alfaro, who up until this date had served as the Mine Manager of the same Division, assumes his
role.

– On February 8, 2019, itwas reported as an essential fact, according to the provisions in Circular No. 1,072,
details of the financing operation carried out on January 28, 2019.

– On February 8, 2019, it was reported as an essential fact that, on the occasion of climatic phenomenon
that affected the north of the country, Codelco has had to put on hold part of the tasks in divisions
Chuquicamata and Ministro Hales. The restoration of operations will be progressive as long as the climatic
conditions allow, while mitigation measures to minimize the effects of this paralysis are put in place.

120
CORPORACION NACIONAL DEL COBRE DE CHILE
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
(In thousands of US dollars of the United States of America, except as indicated in other currency or unit)
(Translation to English of the Consolidated Financial Statements originally issued in Spanish — see Note 1.2)

It is estimated that, with the existing information up to this moment, this situation will not cause a material
or significant impact on Codelco’s results in 2019.

– On February 28, 2019, an extraordinary capital contribution was received through the Exempt Decree No.
311 of the Ministry of Finance, pursuant to Law No. 20.970, for an amount of TRUS$400 million.

– On March 1, 2019, it was reported as an essential fact that it was proceeded to designate from April 1,
2019, the following principal executives:

1. Mr. Jaime Rivera Machado was appointed as General Manager of the Andina Division.
2. Mr. Andrés Music Garrido was appointed as General Manager of the Ministro Hales Division.
3. Mr. Sergio Herbage Lundín was appointed as General Manager of the Gabriela Mistral Division.

– As of March 1, 2019, the role of Vice-Presidency of Technology was created reporting to the Executive
President., Don Alvaro García González was appointed, starting on March 11, 2019.

The administration of the Corporation is not aware of other significant events of a financial nature or of any
other nature that could affect these financial statements, which occurred between January 1, 2019 and the
date of issuance of these consolidated financial statements up to the March 28, 2019.

Nelson Pizarro Contador Alejandro Rivera Stambuk
Chief Executive Officer Chief Financial Officer
Gonzalo Zamorano Martínez Javier Tapia Avila
Accounting and Finance Control Manager Accountant Director

121
THE ISSUER

Corporación Nacional del Cobre de Chile
Huérfanos 1270
Santiago
Republic of Chile

TRUSTEE, PAYING AGENT, TRANSFER AGENT AND REGISTRAR

The Bank of New York Mellon
240 Greenwich Street, Floor 7 East
New York, New York 10286
United States

LUXEMBOURG LISTING AGENT

The Bank of New York Mellon SA/NV, Luxembourg Branch
Vertigo Building
Polaris 2-4 rue Eugéne Ruppert
L-2453 Luxembourg
Luxembourg

LEGAL ADVISORS TO THE ISSUER

Ás to New York law As to Chilean law
Cleary Gottlieb Steen € Hamilton LLP Carey y Cía. Ltda.
One Liberty Plaza Isidora Goyenechea, 2800, Piso 43
New York, New York 10006 Las Condes, Santiago
United States Republic of Chile

LEGAL ADVISORS TO THE INITIAL PURCHASERS

As to New York law As to Chilean law

Davis Polk $: Wardwell LLP Philippi, Prietocarrizosa, Ferrero DU €
450 Lexington Avenue Uría SpA
New York, New York 10017 El Golf 40, Piso 20
United States Las Condes, Santiago
Republic of Chile
INDEPENDENT AUDITORS
Deloitte

Auditores y Consultores Ltda.
Rosario Norte 407, Las Condes
Santiago
Chile

$

CODELCO

Corporación Nacional del Cobre de Chile
U.S.$500,000,000 3.150% Notes due 2051

Offering Memorandum

Joint Book-Running Managers

BofA Securities J.P. Morgan Mizuho Securities Scotiabank

December 7, 2020

Link al archivo en CMFChile: https://www.cmfchile.cl/sitio/aplic/serdoc/ver_sgd.php?s567=24443be2448c7e13035666f3d0d2928cVFdwQmVVMUVSWGxOUkZFMVQwUnJNRTVCUFQwPQ==&secuencia=-1&t=1682376108