UPDATE:Chile Codelco 1Q Copper Output 371,000MT Vs 347,000MT

Copper output at Corporacion Nacional del Cobre de Chile, or Codelco, the world's largest copper mining company, rose in the first quarter to 371,000 metric tons from 347,000 tons a year earlier, Codelco Chief Executive Jose Pablo Arellano said Thursday.

Including output from its 49% stake in the El Abra mine, operated by 51% shareholder Freeport-McMoran Copper and Gold Corp. (FCX), total output in the first quarter reached 390,000 tons, up from 367,000 tons the same period a year earlier, Arellano added in a press conference.

Codelco's output increased from a year earlier because the company brought its Gaby copper mine on line in late 2008. Gaby contributed 38,000 tons of copper in the first quarter of 2009 that weren't there in the first quarter of last year, Arellano said.

The mining company also produced 5,000 tons of molybdenum during the quarter, down from the 7,000 tons it produced in January-March 2008.

With copper averaging $1.56 a pound during the first quarter of the year, Codelco's pretax profit plummeted to $97 million from $2.02 billion in the first three months of 2008, when copper averaged $3.52/lb. A sharp drop in molybdenum prices, which fell to an average $21.40 a kilogram in the first quarter from an average $72.50/kg in the same period a year earlier, also pulled pretax profit down.

If Codelco earnings were reported using the same tax requirements as private companies, it would have posted a net profit of $80 million, versus $1.6 billion in the first quarter of 2008.

Company earnings go entirely to the public sector, including a controversial allocation to armed forces weapons procurement totaling 10% of sales.

As to the recovery seen recently in international copper prices, currently around $2 a pound, Arellano told reporters that the company hoped the healthy Chinese demand for the red metal that was buoying prices "is maintained."

"While we'll continue to see market volatility ... we hope the efforts of central banks and governments around the world to boost economies will take effect," the executive said.

-By Carolina Pica, Dow Jones Newswires; 56-2-820-4244; [e-mail]