AGM Statement

Antofagasta PLC
14 June 2006



                                Antofagasta plc

                COMMENTS MADE BY MR. JEAN-PAUL LUKSIC, CHAIRMAN,
                       AT THE 2006 ANNUAL GENERAL MEETING

London, 14 June 2006

I would like to give you a brief update on where we are as a Group today.

Copper and molybdenum prices were very strong in 2005 and this trend has
continued into 2006 with a LME copper record cash price on 18th May of US$3.98
per lb. On the same date last year it was US$1.49 per lb. Copper prices have
recently fallen back as the market responded to the fears of rising interest
rates and the impact this might have on the world economy. In addition there has
been some profit taking. We foresee a strong market based on the fundamentals of
low and declining stocks in parallel with continuing demand in the main
consuming countries, altogether in a limited supply growth environment.
Molybdenum prices, which peaked in 2005 at nearly US$40 per lb., corrected
downwards towards the end of 2005 but seem to have found good support at around
US$25, still well above historical levels. The effect of all this has been that
we have seen very strong cash generation and profitability and this has resulted
in record results.

Accordingly, as announced in March 2006, the Board is pleased to recommend an
ordinary final dividend for the year 2005 of US$0.24 per share making a total
ordinary dividend for the year of US$0.40 (which level we regard as sustainable
for the future) and up 2.56% from the US$0.39 of the previous year. We are also
recommending a special dividend of US$0.70 cents reflecting the exceptional
level of commodity prices, making a total for the year of US$1.10 compared with
US$0.79 in the previous year. This final dividend will be formally proposed
later in the meeting along with other recommendations of a good housekeeping
nature including updating the Articles of Association and a reorganisation of
the capital structure of the Company through a 4 for 1 bonus issue, the effect
of which will be to bring our share price more into line with other companies
trading on the London Stock Exchange.

It is very difficult to anticipate the direction of copper and molybdenum prices
for the rest of the year and we are now facing extreme volatility as the market
tries to find equilibrium. It does seem, however, that we must accept that
commodity prices have moved to higher sustainable levels than in the past not
least because the cost drivers in our business - sulphuric acid, energy, fuel
oil, steel, etc., have increased enormously since last year together with a
considerable strengthening of the Chilean peso.

As reflected in other mining companies' announcements, mine grades inevitably
deteriorate over time. This has also, of course, been true for us and production
has fallen slightly and cash costs have risen. In the four months to 30th April
this year overall copper production was at 141,300 tonnes against 155,300 tonnes
in the same period in 2005, a fall of 9.0% largely resulting from this grade
decline. Cash costs before by-product credits in the same period rose from US
67.7 cents to US 92.0 cents per lb., very much in line with the first quarter
numbers we reported in March and reflecting broad industry pressures including
smelting and refining charges, adverse exchange rate movements and higher input
costs such as fuel. After adjusting for by-product credits, cash costs have
increased from a negative US 7.9 cents to US 47.9 cents per lb., reflecting the
same cost pressures and lower molybdenum prices.

We continue to work hard on improving the Environmental and Corporate Social
Responsibility, Corporate Governance and Safety fronts which now make up a large
part of the Annual Report. The Board of Antofagasta recognise that these aspects
are of great importance to the Company and we take all these areas very
seriously indeed.

Topical matters which I will now comment on are varied.

Before the end of June we will be completing the take-over at a final
acquisition cost of approximately US$220 million of the Tethyan Copper Company
Limited, the Australian company which owns the Reko Dik ore-body exploration
licences in the Baluchistan region of Pakistan. Reko-Diq has a reported and
inferred mineral resource of 2.4 billion tonnes with a copper grade of 0.51 per
cent and a gold grade of 0.27 g/t. As part of the transaction we will be
terminating the clawback rights over these licences which are currently held by
BHP Billiton. We are pleased here, as reported in the Annual Report, that
Barrick Gold Corporation of Canada will join us as equal partners in this
venture and has agreed to bear 50% of the associated acquisition costs. We feel
that this investment represents a great opportunity for us in a country with
tremendous mining potential and a climate encouraging foreign investment.

We continue to study other possible new acquisitions around the world - although
there is, logically, an emphasis on Latin America. The Tethyan acquisition has
shown that we do not rule out looking further a field but we especially look for
projects that allow us to utilise our best skills and in-built knowledge and
thereby add real value. We decided last month that the particular project we
were working on with CVRD in Peru at Cordillera de las Minas was interesting but
not of a sufficient size to justify further investment. At the risk of repeating
myself, we are actively looking for opportunities to expand and grow the
business and I do not expect this attitude to change.

Within Chile we continue to study the options for the further expansion of the
Los Pelambres mine beyond the 3.1 billion tonne resource. We are, as already
announced, expanding production from 125,000 tonnes to 140,000 tonnes per day
ore throughput and this project is well under way and, if all goes smoothly,
should be finished two months early in mid 2007 at a cost of US$180 million. The
Mauro tailings dam construction also continues apace and we are now well
advanced on this project expecting work to be completed on this project in early
2008. As indicated in March, however, costs for this project are expected to be
approximately 15% higher than the original estimate of US$457 million and are
now expected to be around US$534 million reflecting higher steel prices,
engineering and energy costs etc., and accounting for the appreciation of the
Chilean peso.

At Tesoro we are concentrating on increasing the throughput capacity of the
plant to 10.5 million tonnes of ore per year from 9.0 million. We are also
exploring the immediate area around Tesoro which belongs to Antofagasta in order
to increase the mine resource. In passing I might also mention the very real
efforts being made by El Tesoro to optimise water consumption so as to address
the new restrictions now being imposed on water usage in the Atacama desert.

As mentioned in the Annual Report, production levels at Michilla, which is a
high cost mine with limited reserves, may be reduced from the current 42,000
tonnes per year level. The Board expects to take a decision on this by the third
quarter of this year. We are also looking at the possibility of combining the
ore bodies at Buey Muerto and Antucoya, the latter recently acquired from
Soquimich for US$8 million which might provide additional ore for processing at
the Michilla mine plant.

The Esperanza new mine project is now progressing through its feasibility stage
and we hope this work will result in our being able to take a decision on this
by early 2007. The exploration decline will be completed by the end of this
month and the first conformation results are encouraging. The total drill
inferred resources increased to 786 million tonnes with a 0.53% copper grade,
0.20 grams/tonne gold grade and 0.012% molybdenum grade.

Finally I would like to mention the rail and roadtransport and water
distribution businesses of the railway company, FCAB, and the water distribution
business of Aguas de Antofagasta. You will be aware that new mining activity in
the region served by the FCAB has been on the rise, particularly with the
developments at Spence, Escondida and the San Cristobal Mine in Bolivia. These
are all destined to become new mines or expansions of existing mines and the
result of all this should mean a steady growth in business for our distribution
companies in the next few years.

To conclude, therefore, I believe you will agree that 2005 was an excellent year
for Antofagasta and if copper and molybdenum prices continue at more or less the
average level of the first half, 2006 should also be a good year. We continue
with a very positive view of the industry and of ourselves, be it further
development of existing assets, exploration or, more widely, the potential for
new investments and acquisitions that we feel are sensibly priced. For this we
have a strong cash flow and a solid cash position. coupled with a very
experienced and capable team.


----------------------------                 ------------------------
Enquiries                                    Issued by

Antofagasta plc                              Bankside Consultants
Tel: [phone]                        Tel: [phone]
www.antofagasta.co.uk                        Keith Irons
Desmond O'Conor                              Email: [e-mail]
Email: [e-mail]
Hussein Barma
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