Final Results

Antofagasta PLC
11 March 2008

                                Antofagasta plc

      Preliminary Results Announcement for the year ended 31 December 2007

11 March 2008

HIGHLIGHTS

   • Excellent financial results with net earnings (1) up 2.1% to US$1,382.1
    million (2006 - US$1,354.3 million) and cash flows from operations
    maintained at US$2,817.7 million (2006 - US$2,810.1 million). The Group
    benefited from continued strength in commodity prices, which helped offset
    the effects of lower copper production and higher operating costs mainly due
    to industry pressures.

   • Total dividend for the year up 2.9% to 49.6 cents per share. The final
    dividend proposed for 2007 is 43.4 cents, comprising an ordinary dividend of
    5.4 cents and a special dividend of 38.0 cents.

   • Continued progress with capital projects. Los Pelambres completed the
    repowering of its plant in the first half of the year. Construction of the
    Mauro tailings dam, where the resolution of litigation remains pending, was
    98.5% complete by the end of 2007. The Esperanza project, which received
    board approval in mid-2007, remains on schedule with pre-stripping and early
    works having begun following provisional environmental authorisation
    received in December 2007. Production expected to commence as planned at the
    end of 2010.

   • Feasibility studies to enhance the Group's project pipeline. The Reko
    Diq project in Pakistan and the Antucoya project in Chile will have
    commenced feasibility studies in 2008.

   • Increased mineral resources through successful exploration. Increased
    resource estimates at Reko Diq and encouraging preliminary results at Los
    Pelambres and the Sierra Gorda district in Chile (where El Tesoro and
    Esperanza are located) underline the long-term prospects of the Group with
    the potential for the Sierra Gorda district to be developed as a single
    complex for oxide and sulphide ores.

Marcelo Awad, Chief Executive Officer of Antofagasta Minerals S.A., commented:

'We are very pleased with the strong performance of the Group in 2007.
Fundamentals in both the copper and molybdenum markets remain solid and we
expect commodity prices to remain sound well into 2009, although the volatility
that has recently characterised the markets is likely to continue. The Group's
operations have performed well, although industry-wide cost pressures including
fuel, energy and acid prices persist. We continue to make further progress in
the Group's strategy for sustainable growth through new projects and exploration
in Chile and internationally.'

Antofagasta is a Chilean-based mining group listed in the United Kingdom. In
addition to copper mining, its interests include rail and road transport
operations and water distribution.

+--------------------------------------+---------+---------+---------+--------+
|FULL YEAR TO 31 DECEMBER              |         |   2007  |   2006  |% Change|
+--------------------------------------+---------+---------+---------+--------+
|Group turnover                        |    US$'m|3,826.7  |3,870.0  |  (1.1)%|
+--------------------------------------+---------+---------+---------+--------+
|Cash flow from operations             |    US$'m|2,817.7  |2,810.1  |   0.3% |
+--------------------------------------+---------+---------+---------+--------+
|Profit before tax                     |    US$'m|2,750.2  |2,859.0  |  (3.8)%|
+--------------------------------------+---------+---------+---------+--------+
|Net earnings (1)                      |    US$'m|1,382.1  |1,354.3  |   2.1% |
+--------------------------------------+---------+---------+---------+--------+
|Earnings per share                    |    cents|  140.2  |  137.4  |   2.0% |
+--------------------------------------+---------+---------+---------+--------+
|Total dividends per share (2)         |    cents|   49.6  |   48.2  |   2.9% |
+--------------------------------------+---------+---------+---------+--------+
|LME copper price (per pound)          |    cents|  323.3  |  305.3  |   5.9% |
+--------------------------------------+---------+---------+---------+--------+
|Group copper production               |     '000|  428.1  |  465.5  |  (8.0)%|
|                                      |   tonnes|         |         |        |
+--------------------------------------+---------+---------+---------+--------+
|Group weighted average cash costs (3) |    cents|   31.6  |   40.2  | (21.4)%|
|(net of by-product credits)           |         |         |         |        |
+--------------------------------------+---------+---------+---------+--------+
|Group weighted average cash costs (3) |    cents|  110.7  |   95.6  |  15.8% |
|excluding by-product credits          |         |         |         |        |
+--------------------------------------+---------+---------+---------+--------+
|Market molybdenum price (per pound)   |    US$  |   30.2  |   24.8  |  21.8% |
+--------------------------------------+---------+---------+---------+--------+
|Group molybdenum production           |     '000|   10.2  |    9.8  |   4.1% |
|                                      |   tonnes|         |         |        |
+--------------------------------------+---------+---------+---------+--------+

(See footnotes 1 to 3 below.) 

1 Net earnings refer to profit for the financial year attributable to equity
holders of the Company.

2 Dividends are paid in either sterling or US dollars. The conversion rate for
dividends to be paid in sterling will be set on 13 May 2008.

3 Cash cost is a method used by the mining industry to express the cost of
production in cents per pound of copper, and is further explained in Note 29(b)
(iii).

+---------------------------------------+---------------------------------------+
|Enquiries - London : Antofagasta plc   | Press enquiries : Bankside Consultants|
+---------------------------------------+---------------------------------------+
|Tel: [phone]                  |                  Tel: [phone]|
+---------------------------------------+---------------------------------------+
|www.antofagasta.co.uk                  |                            Keith Irons|
+---------------------------------------+---------------------------------------+
|Desmond O'Conor                        |              Email: [e-mail]|
+---------------------------------------+---------------------------------------+
|Email: [e-mail]       |                  Tel: [phone]|
+---------------------------------------+---------------------------------------+
|Hussein Barma                          |                         Oliver Winters|
+---------------------------------------+---------------------------------------+
|Email: [e-mail]        |     Email: [e-mail]|
+---------------------------------------+---------------------------------------+
|Enquiries - Santiago : Antofagasta     |                                       |
|Minerals S.A.                          |                                       |
+---------------------------------------+---------------------------------------+
|Tel [phone]                      |                                       |
+---------------------------------------+---------------------------------------+
|Alejandro Rivera                       |                                       |
+---------------------------------------+---------------------------------------+
|Email: [e-mail]            |                                       |
+---------------------------------------+---------------------------------------+



DIRECTORS' COMMENTS FOR THE YEAR TO 31 DECEMBER 2007

Overview

The Group had another excellent year in 2007, with net earnings marginally up
2.1% to US$1,382.1 million and cash flow from operations maintained at a similar
level of US$2,817.7 million. These results were achieved against a background of
continued strength in metal prices and sound operational performances across the
Group.

During 2007 metal prices remained well above historical levels. LME copper
prices averaged 323.3 cents per pound (2006 - 305.3 cents per pound), ranging
from a low of under 240 cents to a peak of nearly 380 cents, reflecting changes
in market sentiment during the year. Despite some weakness towards the end of
the year, prices have since recovered strongly and have reached over 400 cents
per pound in early March. Molybdenum prices, which were much less volatile,
averaged US$30.2 per pound (2006 - US$24.8 per pound), rising from under US$25
per pound at the beginning of the year to nearly US$33 per pound by the end of
the year. The Group expects fundamentals in both copper and molybdenum to remain
sound, with strong demand in Asian and other emerging markets and steady growth
in Europe to offset weakness in the United States. Nevertheless, with the
uncertainty that has characterised financial markets particularly in the second
half of 2007 and the larger role played by investment funds in commodity
markets, prices for exchange-traded commodities are likely to remain volatile.
The copper concentrate market is expected to remain in continued deficit with
recent increases in smelting capacity, and this should keep tolling charges
favourable to producers.

Group copper production was 428,100 tonnes, a decrease of 8.0% compared with the
previous year. This was principally due to expected lower ore grades together
with the effect of the higher proportion of harder primary ore on throughput at
Los Pelambres. This was only partly offset by the benefit from the plant
expansion which had been substantially completed at the end of 2006. However,
attributable copper production remained virtually unchanged at 300,400 tonnes
(2006 - 300,200 tonnes) following the acquisition of Equatorial Mining Limited
in the second half of 2006 which increased the Group's interest in El Tesoro to
100%. Molybdenum production at Los Pelambres reached a record 10,200 tonnes,
4.1% above 2006. The transport and water divisions both achieved further
increases in volumes benefiting from new contracts coming on stream in the past
two years.

Weighted average cash costs at the mining operations were 31.6 cents per pound,
compared with 40.2 cents per pound in the previous year, as a result of improved
molybdenum by-product credits and lower tolling charges. Excluding these, cost
pressures remain significant and weighted average on-site and shipping costs
increased from 68.0 cents per pound in 2006 to 90.6 cents per pound in 2007, due
to higher input costs such as energy, fuel and sulphuric acid prices, one-off
costs of new labour agreements signed in the year and the impact of the lower
production at Los Pelambres. As explained below, industry-wide pressures are
expected to persist through 2008, particularly as a result of higher energy
costs and sulphuric acid prices in Chile.

The Group also made good progress with its development plans during 2007. Los
Pelambres completed its plant expansion in the first half of the year, although
the effect of the higher proportion of harder primary ore will mean that
throughput will average approximately 130,000 tonnes per day over the next 10
years. Construction of the Mauro tailings dam, which is necessary for continued
operations when the Quillayes dam reaches capacity, was nearly complete by the
end of the year. Los Pelambres is currently awaiting resolution of the
litigation concerning the dam in order to complete the remaining works and
commence its operation; the Group continues to believe that all necessary
permits and land titles have been properly applied for and granted. Further
details of these cases are given later in these Directors' Comments.

The Group's greenfield opportunities also remain attractive. The Esperanza
project, which received board approval in mid-2007, has obtained provisional
environmental authorisation to commence pre-stripping and other initial works.
Full environmental approvals are expected in mid-2008 and production is expected
to commence on schedule at the end of 2010. Tethyan Copper Company Limited
('Tethyan'), the Group's joint venture with Barrick Gold Corporation, completed
an 18-month exploration programme and scoping study at Reko Diq in south-west
Pakistan which has resulted in a significant increase in the mineral resource
estimate in the Western Porphyries to 4.1 billion tonnes (compared to the
previous mineral resource estimate of 1.6 billion tonnes). Tethyan has initiated
a feasibility study for a 72,000 tpd operation in 2008 and will examine options
for future expansion. It has also commenced discussions with the federal and
provincial governments on a mineral agreement to establish a framework for
future investment. During 2008, the Group will also conduct a feasibility study
at Antucoya for a run-of-mine project which could extend the life of the
Michilla plant beyond its current operations.

The Group maintained an active exploration programme within Chile over the year.
The results of the two-year exploration programme at Los Pelambres are under
review, with encouraging initial results. Results in the Sierra Gorda district
surrounding El Tesoro and Esperanza have also been encouraging and the Group
either owns or has a controlling interest in a number of other deposits
including the Telegrafo sulphide deposit, smaller satellite oxide deposits
surrounding El Tesoro and Caracoles, a porphyry to the southeast of Esperanza.
With estimated combined mineral resources (including El Tesoro and Esperanza) of
approximately 3 billion tonnes, the Sierra Gorda district has eventual potential
for development as a single complex for both oxide and sulphide ores.

In the conduct of the Group's operational, development and exploration
activities as set out above, the Board places great importance on a range of
considerations including health and safety, environmental matters, community
relations and proper management of human resources. Sustainable development
considerations are an integral part of the Group's decision-making process and
it adopts a long-term view in formulating strategy, company policy and everyday
business procedures.

The Board has announced a final dividend for 2007 of 43.4 cents per ordinary
share, comprising an ordinary dividend of 5.4 cents and a special dividend of
38.0 cents. This gives a total dividend for the year of 49.6 cents, representing
a distribution of 35% of 2007 net earnings and a 2.9% increase over 2006. The
Board believes this combines its desire to continue to return cash to
shareholders in a year of strong results with the ability to develop the Group's
existing opportunities for growth.


Review of Operations

Los Pelambres

Los Pelambres had another very good year with operating profit of US$2,098.6
million, 5.6% below 2006, as higher molybdenum volumes and prices and lower
tolling charges offset the effects of lower copper production, marginally lower
copper prices and higher on-site and shipping costs.

Realised copper prices at Los Pelambres were 328.3 cents per pound (2006 - 335.0
cents per pound) despite the higher average LME price during the year, because
of lower provisional pricing credits compared with 2006 when the LME price had
increased very significantly over the course of that year. Realised molybdenum
prices increased to US$31.7 per pound (2006 - US$24.6 per pound) reflecting
higher market prices and tight market conditions. Realised molybdenum prices did
not differ significantly from market prices in either year. Further details of
pricing adjustments for both copper and molybdenum are given in the Financial
Commentary on page 13 and in Note 4(a) to the preliminary results announcement.

Los Pelambres produced 289,900 tonnes of payable copper in 2007, 10.6% below the
2006 production of 324,200 tonnes. The decrease was mainly due to an expected
reduction in the ore grade to 0.71% (2006 - 0.81%). In addition, processing
levels were affected by the higher proportion of harder primary ore; this offset
the benefit of the plant expansion which had been substantially completed at the
end of 2006. Ore throughput averaged 126,300 tpd (2006 - 127,400 tpd), compared
to initial estimates of 134,000 tpd. Molybdenum production reached a record
level of 10,200 tonnes, compared with 9,800 tonnes in 2006 as Los Pelambres
continued to benefit from high molybdenum grades in the current phase of the
mine plan (0.030% in 2007 compared with 0.028% in 2006).

Cash costs, which are stated net of by-product credits and include tolling
charges, were negative 10.8 cents compared to 16.4 cents per pound in 2006. The
decrease of 27.2 cents was due to higher by-product credits (which increased
from 79.7 cents to 116.7 cents) and lower tolling charges (which decreased from
39.7 cents to 29.6 cents), partly offset by an increase in on-site and shipping
costs from 56.4 cents in 2006 to 76.3 cents this year. Higher by-product credits
resulted mainly from the increase in molybdenum production and prices. Tolling
charges decreased principally due to the more favourable terms achieved in the
negotiations with smelters for the 2007 calendar year, including both lower
treatment and refining charges and nil price participation, although the impact
of this was partly mitigated by the 'brick system' under which terms agreed are
often averaged over two years. The increase in on-site costs was principally due
to the lower production as well as increased machinery hire, fuel, oil and
labour costs (which included on-off bonus payments on early conclusion of union
negotiations as explained below).

Labour relations remained good and Los Pelambres was able to reach new labour
agreements with both its unions ahead of schedule. A 45 month agreement was
reached with the mine-port union in May 2007, in advance of the expiration of
the previous agreement in the fourth quarter of 2007. Similarly, a 48 month
agreement was reached with the plant union in November, ahead of the scheduled
time of mid-2008. These included one-off signing bonuses for both negotiations
of US$6.8 million.

During 2007 Los Pelambres continued to reduce its borrowings with repayments
totalling US$81.4 million. Remaining borrowings at the end of the year (net of
deferred financing costs) were US$233.7 million.

Los Pelambres also progressed with its capital expenditure programmes, which are
being financed out of its cash resources. Total capital expenditure in 2007 was
US$323.4 million.

Remaining expenditures on the expansion of the plant through a re-powering of
the grinding lines, installation of a fifth ball mill and additional flotation
cells, which commenced in mid-2005, was completed during 2007 at a remaining
cost of US$47.6 million, mainly incurred in the first half of this year. The
total cost of the project was US$192 million, marginally in excess of the
original budget of US$182 million. Due to the impact of the harder primary ore
now experienced by Los Pelambres, plant throughput is expected to average
approximately 130,000 tpd over the next ten years and 120,000 tonnes per day
over the life of the existing mine plan which runs to 2047.

Los Pelambres also progressed with the Mauro tailings dam, which was 98.5%
complete by the end of 2007. Cumulative expenditure at the end of 2007 was
US$526.5 million, of which US$203.5 million was incurred in the year. The Mauro
dam, together with the Quillayes tailings dam, will provide Los Pelambres with
sufficient storage capacity to support the existing mine plan. As previously
reported, there are a number of claims currently in the Chilean courts against
either third parties (governmental authorities or former land owners in the El
Mauro area) and in one case directly against Los Pelambres. These cases include
the case against the Chilean Water Authority which is under appeal to the
Supreme Court and which is now being heard by that Court during March. In all
cases, the Group believes that Los Pelambres has received all the necessary
technical and legal permits and land ownership for the Mauro tailings dam and
these have been properly applied for and granted in accordance with applicable
regulations and the law. Resolution of these cases will, however, be necessary
to enable some of the remaining works to be completed and for the tailings dam
to be put into operation. Current operations remain unaffected while the
Quillayes dam, which is expected to have capacity until early 2009, remains in
use.

In 2008 the ore processing level is expected to increase to approximately
130,000 tpd compared with 126,300 tpd in 2007, partly due to improvements in the
crushing process at the end of 2007 and a lower proportion of primary ore in
2008. The ore grade is also expected to improve under the current phase of the
mine plan to approximately 0.79%, with better grades in the second half of the
year, and reverting to lower grades in subsequent years. Consequently, copper
production is expected to increase to approximately 330,000 tonnes. Molybdenum
production is expected to be approximately 6,800 tonnes, as the molybdenum grade
is expected to decrease to approximately 0.019% in the area of the mine to be
worked under the 2008 plan and this will only be partly compensated by the
higher throughput level.

Tolling charges are expected to continue to fall in 2008 to less than 20 cents
per pound, due to further reductions in the annual benchmark and as the full
benefit of nil price participation is realised under the brick system. With
continued cost pressures, however, on-site and shipping costs are expected to
increase. This is principally due to higher energy costs resulting from the
renegotiation of Los Pelambres' energy contract after the expiry of the previous
agreement at the end of 2007, and to a lesser extent, other costs including
fuel, freight and explosives which will outweigh the benefit of increased
production. Cash costs before by-product credits (including on-site and shipping
costs as well as tolling charges) are expected to increase from 105.9 cents per
pound in 2007 to approximately 113 cents in 2008. By-product credits are
expected to be lower in line with reduced molybdenum production, although Los
Pelambres should continue to benefit from the tight molybdenum market which is
expected to keep prices strong.


El Tesoro

Operating profit at El Tesoro was US$380.3 million compared with US$409.9
million in 2006, as higher copper prices and reduced hedging costs were offset
by increased cash costs and a marginal reduction in production and sales
volumes.

Realised copper prices were 327.6 cents per pound compared with 316.4 cents in
2006, reflecting the higher average LME price and strong cathode premiums,
partly offset by less favourable pricing adjustments on provisionally invoiced
cathode sales compared with the previous year.

Production at El Tesoro was 93,000 tonnes in 2007, marginally below the 94,000
tonnes produced the previous year. Plant throughput averaged 26,800 tonnes per
day compared with 28,700 tonnes per day in 2006, due to higher moisture levels
in the ore processed. The difficulties experienced with high moisture levels
were successfully resolved through modifications to the production process in
the final quarter of the year, when processing levels were comparable to 2006.
Ore grades averaged 1.23%, compared with 1.16% in 2006.

Cash costs increased from 78.6 cents per pound in 2006 to 109.8 cents per pound
in 2007. The principal factor was higher energy costs as in line with several
other companies in northern Chile, El Tesoro renegotiated its energy contract
during the first half of the year to absorb the higher generation costs faced by
suppliers in the region. Other factors included a higher waste-to-ore ratio,
increased acid consumption and prices and the greater costs of processing ores
with a high content of carbonates. Results during the year were also affected by
an inventory provision of US$18.8 million during the first half, as reported in
the interim results. This related to high carbonate ore accumulated in the
previous year which was no longer expected to be processed following a review of
the mine plan. There were no further provisions required in the second half.

As explained in the interim results, El Tesoro entered into a commodity hedging
programme using min-max instruments in the first half of the year; these did not
have any material impact on its operating results in 2007. In contrast, the 2006
results included a charge to operating profit of US$44.8 million. Further
details of the effects of commodity hedging and the instruments in place at 31
December 2007 are given in the financial commentary under 'Derivative Financial
Instruments' and in Note 4(b) to the preliminary results announcement.

Borrowings continued to be reduced by regular repayments of US$14.1 million; the
remaining balance of US$14.1 million at the end of the year is expected to be
repaid by the end of 2008.

During 2007, El Tesoro revised its mine plan to incorporate Tesoro North-East, a
satellite deposit which is located approximately one kilometre from the existing
open pit, with ore reserves of 28.5 million tonnes with an average grade of
1.03%. Its inclusion in El Tesoro's mine plan will help to mitigate the decline
in grades that would otherwise occur from mining exclusively from the open pit,
and extends the mine life by three years to 2020. Pre-stripping began in
December 2007 and is expected to be completed in mid-2009, at a cost (including
equipment) of approximately US$80 million. Tesoro North-East is owned through
Antomin Limited, in which the Group has approximately a 51% interest.

In 2008, El Tesoro expects to produce approximately 90,000 tonnes, mainly due to
a reduction in the ore grade to 1.13% which is partly offset by an increase in
ore throughput following the modification to the crushing process completed in
the final quarter of 2007. Cash costs are expected to increase to approximately
142 cents per pound. This is mainly due to a significant increase in annual
sulphuric acid contract prices, which have doubled compared with 2006 due to a
combination of increased demand and supply constraints in the region. Other
factors include higher energy costs, which remain under pressure and normal
inflationary pressures, partly offset by lower mine costs due to an expected
decrease in the stripping ratio.


Michilla

Operating profit in 2007 increased to US$154.0 million (2006 - US$145.5
million), reflecting continued strong copper prices and the significantly lower
impact of commodity hedging, partly offset by higher cash costs.

Realised copper prices in the year were 313.8 cents per pound (2006 - 318.5
cents per pound), reflecting strong LME prices, cathode premiums and to a lesser
extent positive pricing adjustments in both years. As explained in Note 4(b) to
the Preliminary Results Announcement, realised copper prices in 2007 also
include the effect of commodity hedging due to the application of the hedge
accounting provisions of IAS 39; previously this was included in operating cost.

Production in the year reached 45,100 tonnes, compared with 47,300 tonnes in
2006. This was partly due to lower ore grades of 1.03% (2006 - 1.05%) as well as
lower throughput which averaged 14,800 tonnes per day (2006 - 15,200 tonnes per
day) as a result of some disruption in November as a result of the earthquake in
northern Chile.

Cash costs for 2007 were 143.5 cents per pound, compared with 126.4 cents in
2006. The increase was due to a range of factors including increased energy
costs, lower production, higher costs of third party services and the impact of
the bonus payment following the early conclusion of the labour agreement in May
as previously reported.

The impact of commodity hedging was significantly lower at US$14.2 million
compared with US$39.7 million in 2006. Further details of the effects of
commodity hedging and the instruments in place at 31 December 2007 are given in
the Financial Commentary under 'Derivative Financial Instruments' and in Note 4
(b) to the Preliminary Results Announcement.

Michilla's current mine plan extends to the end of 2009 and the Group is
currently examining options for a possible extension of mine life. This includes
further exploration at Michilla, with 14,000 metres of drilling carried out in
2007, evaluation of existing resources for inclusion as additional ore reserves
and the possibility of eventually processing enriched copper solution from
Antucoya, which will undergo a feasibility study in 2008 as explained below. Any
eventual decision will, however, depend on the results of further development
expenditure and future copper prices.

For 2008, production is expected to be 43,000 tonnes due to a marginal decrease
in expected recoveries, although ore grades and throughput are expected to be
similar to 2007. Cash costs are expected to increase to nearly 190 cents, mainly
due to higher sulphuric acid prices in 2008 as with El Tesoro. Other factors
include higher energy costs (following a new contract agreed at the beginning of
2008), costs of acquiring ore from third party workings and the effect of the
decrease in production as compared with 2007.


Railway and other transport services

The transport division had another strong year. Rail and road transport volumes
in 2007 were 5.0 million tons (2006 - 4.5 million tons) and 1.3 million tons
(2006 - 1.5 million tons) respectively, a combined increase of 6.4%. The
increase was mainly due to the Spence mine and Escondida's sulphide leach
project, both of which started up in the second half of 2006. The Railway also
began to move cargo for the San Cristobal mine in Bolivia from August, although
production problems and delays at the mine meant that tonnages were below
expectations and these should increase in 2008. Turnover in the year (net of
sales to the mining division) was US$117.0 million (2006 - US$105.3 million),
due to a combination of increased volumes and normal tariff adjustments under
contracts in line with costs.

Operating profit (excluding income from associates) increased by 7.3% to US$35.0
million (2006 - US$32.6 million), mainly as a result of increased volumes. 2006
was also affected by a number of factors including costs from adverse weather
conditions and labour costs following a new union agreement in the early part of
that year; 2007 did not have these exceptional factors.

The Railway's transport volumes should continue to increase in 2008, as the San
Cristobal mine reaches full production. It also has a transport contract for
sulphuric acid and copper cathodes with Codelco's Gaby project, which is
expected to start production in the middle of the year. The rail network also
remains well placed to benefit from any further increases in mining activity in
northern Chile.


Aguas de Antofagasta

Aguas de Antofagasta continued to perform well in 2007. Combined industrial and
domestic water sales were 39.9 million cubic metres compared with 37.8 million
cubic metres in 2006, an overall increase of 5.6%. This included a 1.9% increase
in domestic volumes to 29.0 million cubic metres and a 16.3% increase in
industrial volumes (including water transported) to 10.9 million cubic metres
with the Spence mine starting operations in the second half of 2006. Aguas de
Antofagasta expects that these volumes can be maintained in 2008.

Turnover increased by 5.3% to US$67.1 million (2006 - US$63.7 million), in line
with volumes. Lower domestic tariffs following the completion of the five-yearly
review in mid-2006 were largely offset by the stronger Chilean peso, the
currency in which the majority of sales are invoiced. Operating profit was
US$30.4 million, compared with US$31.5 million in 2006, as increased operating
costs (including the costs of increasing production from the desalination plant
at Antofagasta to meet increased demand) offset the growth in volumes.


Projects, exploration and new opportunities

Esperanza

The Esperanza copper-gold project received board approval for its development at
the end of June following completion of the feasibility study initiated in
August 2006. Esperanza is a sulphide deposit located in Chile's II Region
approximately four kilometres south of the Group's El Tesoro mine. It will
produce copper concentrate containing gold and silver by-product credits through
a conventional milling and flotation process, with ore throughput expected to
average 97,000 tonnes per day. Esperanza has at present a 15 year mine life,
although the Group's adjacent Telegrafo sulphide deposit is ultimately expected
to utilise the Esperanza plant and facilities well beyond this period. The
deposit also includes an oxide ore resource of 119 million tonnes with an
average copper grade of 0.35% which mainly forms part of the 170 million tonnes
of overburden to be removed through pre-stripping. Esperanza is owned by the
Group with a small proportion of the deposit held through Antomin Limited.

An environmental impact assessment was submitted in August 2007, and in December
provisional authorisation was granted to begin pre-stripping and other initial
works which have now begun. Full environmental approvals are expected in
mid-2008, with construction beginning in the third quarter. Esperanza has also
started to enter into contracts for the development of the project; these
include an engineering, procurement, construction and management contract with
Aker-Kvaerner for the plant, orders for plant equipment and machinery and a
memorandum of understanding for the supply of electricity from 2011 with Suez
Energy International. During 2008, the Group expects to examine a number of
options for the financing the Esperanza project, including the possibility of
borrowings, forward sales of gold or the inclusion of a partner.

Capital costs remain within a budget of US$1.5 billion (before taking into
account escalation, any financing costs or working capital requirements), and
Esperanza remains on schedule to start production at the end of 2010. In its
first ten years of operation, Esperanza is expected to produce approximately
700,000 tonnes of concentrate containing 195,000 tonnes of payable copper,
229,000 ounces of payable gold and 1,556,000 ounce of silver, with molybdenum
production expected to start in the fifth year of operation with approximately
2,100 tonnes per year over the following five years.


Reko Diq (Tethyan Copper Company Limited)

The Group holds a 50% interest in Tethyan Copper Company Limited ('Tethyan'),
its joint venture with Barrick Gold Corporation established in 2006. Tethyan's
principal assets are a 75% interest in the exploration licence encompassing the
Reko Diq prospects in the Chagai Hills region of South-West Pakistan (in which
the Government of Balochistan holds the remaining 25%) including the Western
Porphyries, and a 100% interest in certain other licences in the region.

During the year, Tethyan substantially completed its initial 18-month programme
begun in June 2006 at a cost of US$43.4 million to December 2007, which included
US$28 million relating directly to exploration. This included 101,000 metres of
drilling at the Western Porphyries and a scoping study (including
pre-feasibility work) which analysed different project scenarios.

The drilling programme, which was completed in December, has proved successful
with a revised resource estimate for this prospect of 4.1 billion tonnes with a
copper grade of 0.50% and a gold grade of 0.29 g/t. This compares with the
previous estimate for the Western Porphyries of 1.6 billion tonnes with a copper
grade of 0.54% and a gold grade of 0.29 g/t, and represents a 136% increase in
contained copper and a 157% increase in contained gold. In addition, the
previous resource estimates at other prospects in Reko Diq, which have not yet
been updated, amount to a further 0.8 billion tonnes with a copper grade of
0.45% and a gold grade of 0.21 g/t.

Following the scoping study, Tethyan has decided to progress with a feasibility
study for an initial project of 72,000 tonnes per day ore throughput, and this
is expected to be completed in early 2009. It will also continue with initial
studies for potential further expansion. The Group continues to believe that the
long-term potential of this investment remains positive.

Antucoya

During 2007, the Group concluded a drilling programme at Antucoya together with
initial engineering and technical studies. Antucoya is an oxide deposit located
approximately 45 kilometres from Michilla, which incorporates Buey Muerto, a
property held through Antomin Limited. Following the completion of the drilling
programme, Antucoya has an estimated resource of 531 million tonnes of ore with
an average copper grade of 0.39% (compared with a previous estimate of 460
million tonnes with an average copper grade of 0.41%).

The Group has begun a feasibility study to examine a run of mine operation to
provide enriched copper solution which could be processed at the SX-EW plant at
Michilla, eventually producing between 30,000 to 55,000 tonnes of copper per
annum and extending the life of the Michilla plant beyond its own available
reserves. The feasibility study has a budget of US$5.5 million and is expected
to be completed in the second half of 2008. As explained above, however, any
eventual decision will depend on the results of further development expenditure
and future copper prices.

Antomin Limited

The Group holds approximately a 51% interest in Antomin Limited ('Antomin'),
which owns a number of copper exploration properties in Chile's II and IV
Regions. The Group acquired its interest in Antomin pursuant to an agreement in
2001 for a nominal consideration from Mineralinvest Establishment, a company
controlled by the Luksic family, which continues to hold the remaining
approximately 49% of Antomin. Under the terms of the acquisition agreement, the
Group committed to meet in full the exploration costs (including costs incurred
during the pre-feasibility stage) in respect of these properties.

Antomin's properties include (but are not limited to) Buey Muerto (which forms
part of Antucoya), Tesoro North-East and a small proportion of the Esperanza
project. These properties are either under development or likely to be developed
as part of the Group's portfolio of projects.

Other exploration activities and opportunities

During 2007, the Group spent US$38.1 million in exploration activities (2006 -
US$21.5 million). This included US$17.7 million relating to Reko Diq (including
both its share of costs incurred by Tethyan as well as costs incurred on the
Group's own account; 2006 - US$5.3 million); US$1.2 million relating to
Esperanza (2006 - US$6.9 million which related mainly to the costs of the
pre-feasibility study which was completed in the middle of that year) and US$2.4
million relating to Antucoya. Other expenditure related mainly to the Group's
exploration and evaluation programmes in Chile and the rest of the world. A
budget of US$24 million has been established for 2008.

Sierra Gorda district

In Chile, the Group's primary focus was the Sierra Gorda district, where El
Tesoro and Esperanza are located. The Group's acquisition of Equatorial Mining
Limited ('Equatorial') in 2006 provided it with additional mining properties
located between the Telegrafo and Centinela deposits. These are held through a
joint venture in which Equatorial holds 81.5% and Compania Minera Milpo S.A.A.
of Peru holds the remaining 18.5% through Minera Rayrock Limitada. A 6,000 metre
drilling programme was carried out during 2007, and has resulted in the
discovery of Caracoles, a porphyry copper-gold system approximately 10
kilometres southeast of Esperanza. Additional drilling is required to define the
extent of the mineralisation and a budget of US$12 million has been allocated
for 2008.

Further drilling was carried out at the Telegrafo deposit, which is adjacent to
Esperanza and which as explained above could extend the life of the Esperanza
plant and facilities beyond the current Esperanza mine plan. Preliminary
estimated resources are 404 million tonnes of 0.41% copper, 0.1 g/t of gold and
0.013% of molybdenum at Telegrafo Norte and 898 million tonnes of 0.45% copper,
0.17 g/t of gold and 0.013% of molybdenum at Telegrafo Sur, both based on a 0.3%
cut-off grade for copper.

In addition, as previously reported, the Group owns a number of other prospects
in the Sierra Gorda district which include smaller oxide deposits mainly held
through Antomin. Like Tesoro North-East, these could eventually provide
additional ores for the El Tesoro plant when ore grades under the current mine
plan decline in the future.

With estimated combined mineral resources (including El Tesoro and Esperanza) of
approximately 3 billion tonnes, the Sierra Gorda district has eventual potential
for development as a single complex for both oxide and sulphide ores.

Los Pelambres

Los Pelambres concluded the second stage of a two-year exploration programme
which commenced in 2006 in order to identify additional resources beyond the
present 2.9 billion tonnes. The results of this programme in the area to the
south-east of the open pit have been encouraging and additional drilling will be
required to define the resource and to evaluate its economics to the long-term
mine plan of Los Pelambres.

Colombia, Ecuador and Peru

As reported in the Group's interim results, the Group decided in July not to
continue with the exploration agreements with Ascendant Copper Corporation in
respect of the Chaucha deposit in Ecuador and with AngloGold Ashanti in the area
of interest in southern Colombia, following a review of drill results achieved
to date. In June, the Group also completed the disposal of its 50% interest in
Cordillera de Las Minas S.A., through which its joint-venture interests in Peru
with Compania Vale do Rio Doce ('Vale') were held, to Panoro Minerals Limited
('Panoro'). These regions nevertheless remain within the focus of the Group,
with an on-going programme in Ecuador, which remains committed to its search for
opportunities both in Latin America and world-wide.

Opportunities in geo-thermal and coal exploration and generation

As countries in the southern cone, particularly Chile, are facing severe
problems relating to shortages of energy supplies and significantly increasing
costs, the Group has decided to enter the energy exploration business and has
formed management and exploration teams to search for geo-thermal prospects. It
has been granted title to the 62,000-hectare Tinguiririca geo-thermal
concessions in south-central Chile and also secured approximately 116,000
hectares of a largely unexplored coal basin in southern Chile, with exploration
planned during 2008.



Dividends

Dividends per share proposed in relation to the year are as follows:
+--------------+-----------------------------------+-----------------------------+
|              |            US dollars             |      Percentage change      |
+--------------+--------+--------+--------+--------+---------+---------+---------+
|              |    2007|    2006| 2005(1)| 2004(1)|  07 v 06|  06 v 05|  05 v 04|
|              |   cents|   cents|   cents|   cents|   change|   change|   change|
+--------------+--------+--------+--------+--------+---------+---------+---------+
|Ordinary      |   3.2  |   3.2  |   3.2  |   3.0  |         |         |         |
+--------------+--------+--------+--------+--------+---------+---------+---------+
|Interim       |   5.4  |   5.0  |   4.8  |   4.8  |         |         |         |
+--------------+--------+--------+--------+--------+---------+---------+---------+
|Final         |        |        |        |        |         |         |         |
|              | -------| -------|--------| -------|         |         |         |
|              |   8.6  |   8.2  |   8.0  |   7.8  |    4.9% |    2.5% |    2.6% |
|              | -------| -------|--------| -------|         |         |         |
+--------------+--------+--------+--------+--------+---------+---------+---------+
|Special       |   3.0  |   2.0  |     -  |     -  |         |         |         |
+--------------+--------+--------+--------+--------+---------+---------+---------+
|Interim       |  38.0  |  38.0  |  14.0  |   8.0  |         |         |         |
+--------------+--------+--------+--------+--------+---------+---------+---------+
|Final         |        |        |        |        |         |         |         |
|              | -------| -------|--------| -------|         |         |         |
|              |  41.0  |  40.0  |  14.0  |   8.0  |         |         |         |
|              | -------| -------|--------| -------|         |         |         |
+--------------+--------+--------+--------+--------+---------+---------+---------+
|Total         |  49.6  |  48.2  |  22.0  |  15.8  |    2.9% |  119.1% |   39.2% |
|dividends to  | =======| =======|========| =======|         |         |         |
|ordinary      |        |        |        |        |         |         |         |
|shareholders  |        |        |        |        |         |         |         |
+--------------+--------+--------+--------+--------+---------+---------+---------+
|              |            Percentage             |         |         |         |
+--------------+--------+--------+--------+--------+---------+---------+---------+
|Dividends as a|    35% |    35% |    30% |    27% |         |         |         |
|percentage of | =======| =======|========| =======|         |         |         |
|profit        |        |        |        |        |         |         |         |
|attributable  |        |        |        |        |         |         |         |
|to equity     |        |        |        |        |         |         |         |
|shareholders  |        |        |        |        |         |         |         |
+--------------+--------+--------+--------+--------+---------+---------+---------+

1 Dividends per share have been restated for the effects of the 4-for-1 bonus
issue on 19 June 2006.

2 Further details relating to dividends are given in Note 8 to this Preliminary
Results Announcement.


The Board recommends a final dividend of 43.4 cents per ordinary share payable
on 12 June 2008 to shareholders on the Register at the close of business on 9
May 2008. The final dividend comprises an ordinary dividend of 5.4 cents and a
special dividend of 38.0 cents. Including the interim dividend, this represents
a distribution of approximately 35% of net earnings (profit attributable to
equity holders of the Company) after taking into account withholding taxes
incurred by the Group in funding the dividend.

The Board's policy is to establish an ordinary dividend which can be maintained
or progressively increased at conservative long-term copper prices and through
the economic cycle. The Board recommends special dividends when it considers
these appropriate after taking into account the level of profits earned in the
period under review, the existing cash position of the Group and significant
known or expected funding commitments. As can be seen from the above table, the
Board has increased its recommended dividends in line with profits by means of
special dividends in these years of high copper prices.

The cost of the final dividend, including related withholding taxes, is
approximately US$546 million. In determining this, the Board has taken into
account its existing capital commitments and working capital requirements and
considers this to be an appropriate level of distribution of profits earned in
the year. The Board has also considered the potential future capital
requirements of the Group which could amount to approximately US$3 billion over
a number of years, should it proceed with its existing portfolio of projects and
opportunities, and it believes these remain attractive for the long-term
development of the Group even in an environment of lower copper prices. The
Board also considers that this provides the Group with sufficient flexibility to
take advantage of new opportunities which may arise in the future.


Current Trading Prospects

Although the copper market remained volatile in 2007, driven by uncertainty in
financial markets and economic concerns particularly in the United States, LME
prices averaged 323.3 cents - an increase of 5.9% over the previous year. More
recently, despite some weakness towards the end of 2007, prices have recovered
strongly and have averaged 338.6 cents in the first two months of 2008 while
spot prices in early March have reached over 400 cents.

Market fundamentals for copper remain sound and continued strength in China and
other regions such as South Asia and the Middle East is expected to help offset
the effects of a slowdown in the United States. Supply continues to be affected
by disruptions, including labour disputes, energy supply constraints, equipment
availability and longer lead times to develop new projects and expansions due to
previous underinvestment in the sector as well as stricter environmental
permitting in some countries. With some additional mine production coming on
stream, for example Codelco's Gaby project, most commentators expect a small
market surplus could develop in the second half of 2008 although this will
continue to be subject to supply-side risks. Low inventory levels should
continue to support high prices with recent consensus estimates having increased
to approximately 340 cents for 2008 and falling only slightly below that for
2009. Cost pressures continue to affect the industry and increased production
costs should help to keep prices above previously long-term historical levels
further into the future. Nevertheless, the increased role of investment funds in
commodity markets has made base metals more sensitive to changes in market
sentiment and given current financial and economic concerns, prices are expected
to remain volatile.

The concentrate market also remains in favour of producers, with the
concentrates deficit which developed in 2006 continuing to intensify as further
smelting capacity has continued to come on stream through 2007 which has
exceeded any increases in mine production. This has resulted in improved terms
for producers with settlements for the annual negotiations for 2008 at the level
of US$45 per dry metric tonne of concentrate for smelting and 4.5 cents per
pound of copper for refining, compared with US$60 and 6.0 cents respectively
agreed in respect of 2007. Price participation has also been agreed at nil for
the second successive year (compared with 10% over 90 cents per pound in 2006
and earlier years), which will continue to benefit producers under the 'brick
system' whereby the benchmark is often averaged over two years. Most
commentators expect the concentrate deficit to remain at least until 2010, with
the market continuing to balance through reduced utilisation rates by smelters.

The molybdenum market has also remained strong, remaining in deficit again in
2007. Prices improved from over US$25 per pound at the start of 2007 to average
over US$30 per pound, with current spot prices of over US$33 per pound. Demand
is expected to remain strong, driven by the continued demand from both the steel
and catalyst sectors. Supply growth in 2008 is expected to be limited, as a
number of producers (including Los Pelambres) will experience lower grades or
will face fewer opportunities for further flex-grading or otherwise increasing
production following the high prices of recent years. A number of primary
molybdenum mines are under construction, and if successfully developed these
could redress the market balance from 2009. Market consensus is for prices to
exceed US$30 per pound in 2008, possibly weakening in 2009 to around US$25 per
pound, but this will depend on how successfully new primary mines come on stream
to provide additional supply.

For 2008, Group copper production is expected to increase by approximately 8% to
463,000 tonnes, mainly due to improved ore grades and higher throughput at Los
Pelambres compared with 2007. Molybdenum production is expected to be
approximately 6,800 tonnes compared with the 10,200 tonnes achieved for 2007 due
to lower expected molybdenum ore grades at Los Pelambres. Cash costs will
increase mainly due to the strengthening of the Chilean peso and industry cost
pressures particularly energy costs and, in the case of the Group's heap-leach
operations, significantly higher sulphuric acid prices. These are, however,
partly mitigated by lower tolling charges at Los Pelambres. Excluding
by-products, weighted average cash costs are expected to increase by
approximately 13% to around 125 cents per pound.

With the continued progress made in 2007 on the Group's development plans, the
medium to longer term prospects for the Group also remain good. In addition to
the Esperanza project which is now in the development phase with start-up
scheduled for the end of 2010, the Reko Diq and Antucoya projects could
eventually also contribute additional production in future years. While the
cases in relation to the Mauro tailings dam require resolution, the Group is
confident that longer-term potential for Los Pelambres also remains good. The
Group's exploration programme has also shown encouraging results, with potential
for its prospects in the Sierra Gorda district to enhance El Tesoro and
Esperanza in the future. The Group believes it has a number of prospects that
could substantially enhance its current production profile in the medium to
longer term, and it intends to use its sound financial position to advance its
existing assets and properties while continuing to seek opportunities globally
to secure further world-class mining assets.


FINANCIAL COMMENTARY FOR THE YEAR TO 31 DECEMBER 2007

Results

Turnover

Group turnover in 2007 was US$3,826.7 million, 1.1% below the US$3,870.0 million
achieved in 2006. The slight decrease mainly reflected the impact of lower sales
volumes and realised prices for copper, partly offset by the effect of higher
molybdenum prices and volumes, reduced tolling charges for copper concentrate
and increased sales at the transport and water divisions.

Turnover from copper concentrate and copper cathodes

Turnover from copper concentrate and copper cathode sales from the Group's three
mines decreased by 7.3% to US$2,915.9 million, compared with US$3,144.7 million
in 2006. The Group's average realised copper price decreased by 0.9% to 326.6
cents per pound (2006 - 329.5 cents), despite a 5.9% increase in the average LME
copper price to 323.3 cents per pound (2006 - 305.3 cents). Realised copper
prices are determined by comparing turnover (gross of tolling charges for
concentrate sales) with sales volumes in the period. Realised copper prices
differ from market prices mainly because, in line with industry practice,
concentrate and cathode sales agreements generally provide for provisional
pricing at the time of shipment with final pricing based on the average market
price for future periods (normally about 30 days after delivery to the customer
in the case of cathode sales and up to 180 days after delivery to the customer
in the case of concentrate sales). In 2007 the pricing adjustments on
provisionally invoiced sales, while remaining positive, were lower than in 2006,
as the level of increase in the LME copper price in the current year was less
than in 2006.

In the case of Los Pelambres, pricing adjustments added US$52.8 million in 2007
to initially invoiced sales (before adjusting for tolling charges) compared with
US$223.5 million in 2006. The adjustments in 2007 comprised US$22.0 million in
respect of sales invoiced in 2006 (net of the reversal of mark-to-market
adjustments made at the end of 2006) which were finally priced in 2007 and
US$30.8 million in respect of sales invoiced in 2007 (net of a mark-to-market
provision for open sales at the end of the year of US$72.8 million). Pricing
adjustments in 2007 at El Tesoro and Michilla reduced revenues by US$5.1 million
(2006 - increased revenues by US$11.7 million) and US$1.2 million (2006 -
increased revenues by US$8.9 million) respectively. El Tesoro and Michilla
continued to benefit from strong cathode premiums reflecting tight market
conditions in the year. Further details of provisional pricing adjustments are
given in Note 4(a) to the preliminary results announcement.

In 2007 turnover also included a loss of US$14.0 million on commodity
derivatives at El Tesoro and Michilla which matured during the year, recognised
under the hedge accounting provisions of IAS 39 'Financial Instruments:
Recognition and Measurement' which were applied with effect from 1 January 2007.
As explained below, during 2006 losses on the commodity derivatives were
recognised within other operating expenses.

Copper sales volumes decreased by 8.4% from 467,800 tonnes in 2006 to 428,500
tonnes this year. The decrease was mainly due to the expected lower ore grades
together with the effect of harder primary ore on throughout at Los Pelambres.
Sales volumes differed slightly from production each year mainly due to
differences in shipping and loading schedules.

Tolling charges for copper concentrate at Los Pelambres decreased from US$254.0
million in 2006 to US$169.4 million in 2007, mainly due to reduced price
participation as a result of the 2007 calendar year negotiations. Tolling
charges are deducted from concentrate sales in reporting turnover and hence the
decrease in these charges has had a positive impact on turnover compared with
2006.

Turnover from by-products

Turnover from by-products at Los Pelambres increased by 30.6% to US$726.7
million in 2007 compared with US$556.3 million in 2006, mainly due to higher
molybdenum market prices.

Molybdenum revenues (net of roasting charges) were US$676.4 million (2006 -
US$513.8 million). The realised molybdenum price increased by 28.9% to US$31.7
per pound in 2007 (2006 - US$24.6 per pound), mainly due to the increase in the
market price which averaged US$30.2 per pound compared with US$24.8 per pound in
2006. Molybdenum sales are also subject to provisional pricing and as prices
strengthened during 2007, realised prices were slightly higher than the average
market price. In contrast, during 2006 weakening prices caused the realised
price to be lower than the market price. Molybdenum sales volumes were similar
at 10,000 tonnes (2006 - 9,900 tonnes), and small differences with production in
each year reflected shipping and loading schedules.

Credits received from gold and silver contained in copper concentrate sold
increased to US$50.3 million (2006 - US$42.5 million).

Turnover from the transport and water divisions

Turnover from the transport division (FCAB) increased by US$11.7 million or
11.1% to US$117.0 million, mainly due to increased rail volumes and normal
tariff adjustments under contracts in line with costs. Volumes increased from
various mines, with the most significant being BHP Billiton's Spence, which
started its operations during the second half of 2006.

Turnover at Aguas de Antofagasta, which operates the Group's water business,
increased by US$3.4 million or 5.3% to US$67.1 million in 2007, mainly due to
increased volumes to industrial customers, mainly due to the impact of the
Spence mine, partly offset by the full year impact of the tariff review in
respect of domestic customers in mid-2006.

Operating profit from subsidiaries and joint ventures and EBITDA

Operating profit from subsidiaries and joint ventures decreased by 5.4% from
US$2,804.1 million in 2006 to US$2,653.4 million in 2007.

Operating profit at the mining division decreased by 5.5% from US$2,740.0
million to US$2,588.0 million, due to the reduction in turnover as explained
above (resulting mainly from reduced copper sales volume, partly offset by the
effect of higher molybdenum prices and reduced tolling charges for copper
concentrate) and increased operating costs. Excluding by-product credits (which
are reported as part of turnover) and tolling charges for concentrates (which
are deducted from turnover), weighted average cash costs for the Group
(comprising on-site and shipping costs in the case of Los Pelambres and cash
costs in the case of the other two operations) increased from 68.0 cents per
pound in 2006 to 90.6 cents per pound. This reflected the impact of higher input
costs and specific factors at each mine as discussed in the review of operations
above.

During 2006 a loss of US$84.5 million was recognised within other operating
expense in respect of commodity derivatives, relating both to amounts realised
on instruments maturing during the period and net mark-to-market adjustments
prior to the adoption of the hedge accounting provisions of IAS 39. As noted
above, during 2007 a loss of US$14.0 million relating to commodity derivatives
which matured in the period has been recorded within turnover, along with a gain
of US$0.7 million recognised within other finance items as explained below and a
mark-to-market loss of US$0.2 million deferred in equity.

Exploration costs increased from US$21.5 million in 2006 to US$38.1 million,
reflecting the increased level of exploration activity across the Group
particularly in Chile and Pakistan. Net costs in respect of corporate and other
items were lower at US$6.8 million (2006 - US$17.6 million) due to one-off gains
included in other operating income of US$21.8 million; further details are given
in Note 2(ii) to the preliminary results announcement.

Operating profit (excluding income from associate) at the transport division
increased by US$2.4 million to US$35.0 million, mainly reflecting the increased
rail volumes as higher tariffs were offset by higher operating costs. Aguas de
Antofagasta contributed US$30.4 million compared to US$31.5 million last year,
with the increased revenues offset by higher operating costs as explained in the
review of operations above.

EBITDA (earnings before interest, depreciation, tax and amortisation) in 2007
was US$2,824.0 million, compared with US$2,957.3 million in 2006, a decrease of
4.5%. This is calculated by adding back to operating profit from subsidiaries
and joint ventures, depreciation and amortisation of US$162.2 million (2006 -
US$145.0 million) and losses on disposals of property, plant and equipment of
US$8.4 million (2006 - US$8.2 million). The increased depreciation related
mainly to higher charges at Los Pelambres (following the completion of the
repowering project which is now in operation) and El Tesoro (due to the full
year effect of fair value amortisation following the acquisition of Equatorial
Mining Limited in August 2006).

The Group's share of net profit from its 30% investment in Antofagasta Terminal
Internacional S.A. ('ATI') was US$1.4 million (2006 - US$1.1 million).


Net finance income

Net finance income in 2007 was US$95.4 million, compared with US$53.8 million in
2006.

Interest receivable increased from US$78.3 million in 2006 to US$113.4 million
in 2007, due to the higher level of cash and deposit balances. Interest expense
decreased from US$25.2 million in 2006 to US$20.4 million, reflecting the
decrease in the level of borrowings through loan repayments during the year.

Other finance items increased from a gain of US$0.7 million in 2006 (restated
for the inclusion of the discount charge relating to provisions from interest
expense) to US$2.4 million. Following the application of the hedge accounting
provisions of IAS 39 'Financial Instruments: Recognition and Measurement' with
effect from 1 January 2007, a gain of US$0.7 million has been recognised in the
year in respect of the time value element of changes in the fair value of
commodity derivative options, which is excluded from the designated hedging
relationship, and is therefore recognised directly in the income statement. No
interest derivatives were held during the current period and so no
mark-to-market gains or losses arose, compared to a mark-to-market gain of
US$0.3 million in 2006. Foreign exchange gains included in finance items were
US$2.9 million in 2007, compared with US$1.6 million in the previous year.

Profit before tax

The resulting profit before tax for the period was US$2,750.2 million compared
to US$2,859.0 million in 2006, reflecting the reduction in turnover and
increased operating costs, partly offset by higher investment income.

Income tax expense

The rate of first category (i.e. corporation) tax in Chile was 17% for both 2007
and 2006. Los Pelambres, El Tesoro and Michilla are also subject to a mining tax
(royalty) which imposes an additional tax of 4% of tax-adjusted operating
profit. For 2006 and 2007, 50% of the mining tax could be offset against first
category tax and the remaining 50% was tax deductible (i.e. an allowable expense
in determining liability to first category tax). From 2008, when the ability to
offset will no longer be available, 100% of the mining tax will be tax
deductible. The effect is to increase the effective tax rate of these three
operations (before taking into account deductibility against corporation tax) by
approximately 2% in 2006 and 2007 and 4% thereafter. In addition to first
category tax and the mining tax, the Group incurs withholding taxes on the
remittance of profits from Chile. Withholding tax is levied on remittances of
profits from Chile at 35% less first category tax already paid. Accordingly, the
effective tax rate of withholding tax for the purpose of paying dividends to
Group shareholders is approximately 18% of the amount remitted or expected to be
remitted.

Tax (including deferred tax) amounted to US$638.4 million (2006 - US$664.9
million), reflecting the decrease in profit before tax for the year. Including
both current and deferred taxes, this comprised corporate tax of US$449.4
million (2006 - US$476.6 million), the Chilean mining tax of US$51.4 million
(2006 - US$56.6 million) and withholding tax charges of US$166.1 million (2006 -
US$134.1 million). This was partly offset by exchange gains on corporate tax
balances of US$28.5 million (2006 - US$2.4 million) since tax prepayments made
in the course of the year, which are designated in Chilean pesos, benefited from
the strengthening of that currency against the US dollar.

As a result of these factors, the effective tax rate for the Group in 2007 was
23.2% (2006 - 23.3%), compared with the Chilean statutory tax rate of 17%.

Minority interests

Profit for the financial year attributable to minority shareholders was US$729.7
million, compared with US$839.8 million in 2006. The decrease was largely due to
the acquisition of Equatorial Mining Limited in the second half of 2006 which
had the effect of eliminating the 39% minority interest at El Tesoro, as well as
the reduction in the Group's profit before tax in 2007 compared with 2006.

Earnings per share

As a result of the factors set out above, profit for the 2007 financial year
attributable to equity shareholders of the Company was US$1,382.1 million
compared with US$1,354.3 million in 2006. Accordingly, basic earnings per share
were 140.2 cents in 2007 compared with 137.4 cents for 2006, an increase of
2.0%.


Derivative financial instruments

The Group periodically uses derivative financial instruments to reduce exposure
to commodity price movements. The Group does not use such derivative instruments
for speculative trading purposes.

The Group has applied the hedge accounting provisions of IAS 39 'Financial
Instruments: Recognition and Measurement' with effect from 1 January 2007. From
that date, changes in the fair value of derivative financial instruments that
are designated and effective as hedges of future cash flows have been recognised
directly in equity, with such amounts subsequently recognised in the income
statement in the period when the hedged item affects profit or loss. Any
ineffective portion is recognised immediately in the income statement. Realised
gains and losses on commodity derivatives recognised in the income statement
have been recorded within turnover. The time value element of changes in the
fair value of derivative options is excluded from the designated hedging
relationship, and is therefore recognised directly in the income statement
within other finance items. Prior to 1 January 2007 derivatives were measured at
fair value through the income statement, with both realised and unrealised gains
or losses on commodity derivatives being recorded within other operating income
or expense.

The impact of derivative instruments on the Group's results for the period is
set out above in the sections on turnover, operating profit from subsidiaries
and net finance income, and in Note 4(b) to this preliminary results
announcement.

At 31 December 2007, the Group had min/max instruments for 70,200 tonnes of
copper production (of which 60,000 tonnes relate to El Tesoro and 10,200 tonnes
relate to Michilla), covering a total period up to 31 December 2009. The
weighted average remaining period covered by these hedges calculated with effect
from 1 January 2008 is 11 months. The instruments have a weighted average floor
of 248.9 cents per pound and a weighted average cap of 389.2 cents per pound.
The Group also had futures for 6,500 tonnes, to both buy and sell copper
production at El Tesoro, with the effect of swapping COMEX prices for LME prices
without eliminating underlying market price exposure, covering a period to 31
January 2009. The remaining weighted average period covered by these instruments
was 7 months.

Between 31 December 2007 and the date of this report, Michilla entered into
further min/max instruments for 15,000 tonnes of copper production, covering a
total period up to 31 December 2008. The weighted average remaining period
covered by these hedges calculated with effect from 1 January 2008 is 7 months.
The instruments have a weighted average floor of 292.1 cents per pound and a
weighted average cap of 342.1 cents per pound.

These instruments represent approximately 60% of Michilla's forecast production
for 2008 and 33% of El Tesoro's forecast production to the end of 2009, and the
Group's exposure to the copper price will be limited to the extent of these
instruments. Details of the mark-to-mark position of these instruments at 31
December 2007, together with details of any interest and exchange derivatives
held by the Group, are given in Note 4(b) to this preliminary results
announcement.


Commodity price sensitivities

Based on 2007 production volumes and without taking into account the effects of
provisional pricing and any hedging activity, a one-cent change in the average
copper price would affect turnover and profit before tax by US$9.4 million and
earnings per share by 0.5 cents. Similarly, a one-dollar change in the average
molybdenum price would affect turnover and profit before tax by US$22.5 million
and earnings per share by 1.1 cents.


Cash flows, cash and debt

Cash flows from operations were US$2,817.7 million in 2007 compared with
US$2,810.1 million last year, reflecting the operating results adjusted for
depreciation, amortisation and disposals gains and losses of US$150.5 million
(2006 - US$153.2 million) and a net working capital decrease of US$13.8 million
(2007 - increase of US$147.2 million). The movement in working capital was
particularly significant in 2006 due to the effect of the significant increase
in the copper price on the level of trade debtors during that year.

A dividend of US$2.4 million (2006 - US$0.4 million) was received from the
Group's investment in ATI.

Cash tax payments in the year were US$806.0 million (2006 - US$498.2 million),
comprising corporation tax of US$537.7 million (2006 - US$426.5 million), mining
tax of US133.0 million (2006 - US$9.9 million) and withholding tax of US$135.3
million (2006 - US$61.8 million). These amounts differ from the current tax
charge in the consolidated income statement of US$598.7 million (2006 - US$592.2
million) because cash tax payments partly comprise monthly payments on account
in respect of current year profits and partly comprise the settlement of the
outstanding balance for the previous year. The increased payments reflect higher
profits in 2006 compared with 2005 (thereby increasing both monthly payments on
account for 2007 as well as settlement of the outstanding balance for the
previous year) and higher withholding tax payments due to higher dividends paid
in 2007.

No acquisitions were made in 2007; in 2006 the cash outflow from acquisitions
(net of cash balances acquired) amounted to US$487.5 million, which comprised
US$199.4 million in respect of Tethyan and US$288.1 million in respect of
Equatorial.

Cash proceeds from disposals of interests in subsidiaries, joint ventures and
available for sale investments amounted to US$27.5 million in 2007. This
comprised US$4.9 million received at the beginning of the period from the sale
of Equatorial North America Inc. in December 2006; US$6.0 million for the cash
element of the sale of the Group's interest in Cordillera de Las Minas S.A. to
Panoro Minerals Limited and US$16.6 million for the sale of shares in Mercator
Minerals Limited. In 2006, cash proceeds from disposals amounted to US$84.3
million, mainly relating to the disposal of 50% of Tethyan to Barrick Gold.

Capital expenditure in 2007 was US$481.7 million compared with US$506.6 million
in 2006. This included expenditure of US$203.5 million relating to the Mauro
tailings dam project (2006 - US$256.9 million), US$47.6 million relating to the
completion of the plant expansion at Los Pelambres (2006 - US$134.0 million),
US$49.3 (2006 - US$ nil) on early works for the next repowering and US$43.7
million relating to the Esperanza project (2006 - US$6.6 million).

Dividends (including special dividends) paid to ordinary shareholders of the
Company this year were US$485.0 million (2006 - US$236.6 million), which related
to the final dividend declared in respect of the previous year and the interim
dividend in respect of the current year, and reflected the increased dividend
per share paid in 2007 compared with 2006. Dividends paid by subsidiaries to
minority shareholders were US$681.2 million (2006 - US$630.6 million),
principally due to increased distributions by Los Pelambres.

Repayments of borrowings and finance leasing obligations in the year, mainly at
Los Pelambres and El Tesoro, were US$100.2 million (2006 - US$ 111.4 million).
New borrowings in the year amounted to US$7.0 million (2006 - US$3.8 million).

Details of other cash inflows and outflows in the year are contained in the
Consolidated Cash Flow Statement.

At 31 December 2007, the Group had cash and cash equivalents of US$2,212.5
million (2006 - US$1,805.5 million). Excluding the minority share in each
partly-owned operation, the Group's attributable share of total cash and cash
equivalents was US$2,135.4 million (2006 - US$1,592.7 million).

Total Group borrowings at 31 December 2007 were US$266.0 million (2006 -
US$358.7 million). Of this, US$169.5 million (2006 - US$230.0 million) is
proportionally attributable to the Group after excluding the minority
shareholdings in partly-owned operations. The decrease in debt is mainly due to
further principal repayments at Los Pelambres and El Tesoro as explained above.


Balance Sheet

Net equity (i.e. equity attributable to ordinary shareholders of the Company)
increased from US$3,155.1 million at 1 January 2007 to US$4,065.0 million at 31
December 2007, relating mainly to profit after tax and minority interests for
the period less ordinary dividends declared and paid in the year. Other changes
relate mainly to movements in the fair value of hedges and available for sale
investments and the currency translation adjustment; these are set out in the
Consolidated Statement of Changes in Equity.

Minority interests increased from US$793.0 million at 1 January 2007 to US$841.5
million at 31 December 2007, principally reflecting the minority's share of
profit after tax, less the minority's share of the dividends paid by
subsidiaries in the year. Other movements affecting minority interest are also
set out in the Consolidated Statement of Changes in Equity.



Consolidated Income Statement
                                               Year ended Year ended
                                                 31.12.07   31.12.06
                                           Notes    US$'m      US$'m

Group turnover                             2,3    3,826.7    3,870.0

Total operating costs                            (1,173.3)  (1,065.9)
                                                 --------   --------
Operating profit from subsidiaries and     2,3    2,653.4    2,804.1
joint ventures

Share of income from associate            2,12        1.4        1.1
                                                 --------   --------
Total profit from operations and             2    2,654.8    2,805.2
associates
                                                 --------   --------
Investment income                                   113.4       78.3
Interest expense                                    (20.4)     (25.2)
Other finance items                                   2.4        0.7
                                                 --------   --------

Net finance income                           5       95.4       53.8
                                                 --------   --------
Profit before tax                                 2,750.2    2,859.0

Income tax expense                           6     (638.4)    (664.9)
                                                 --------   --------
Profit for the financial year                     2,111.8    2,194.1
                                                 ========   ========

Attributable to:
                                                 --------   --------
Minority interests                                  729.7      839.8

Equity holders of the Company (net                1,382.1    1,354.3
earnings)                                        --------   --------

                                                 US cents   US cents

Basic earnings per share                     7      140.2      137.4
                                                 ========   ========

Dividends to ordinary shareholders of
the Company

Per share                                        US cents   US cents
Dividends per share proposed in              8
relation to the year

         - ordinary dividend (interim)                3.2        3.2
           - ordinary dividend (final)                5.4        5.0
          - special dividend (interim)                3.0        2.0
            - special dividend (final)               38.0       38.0
                                                 --------   --------
                                                     49.6       48.2
                                                 ========   ========
Dividends per share paid in the year
and deducted from net equity

         - ordinary dividend (interim)                3.2        3.2
           - ordinary dividend (final)                5.0        4.8
          - special dividend (interim)                3.0        2.0
            - special dividend (final)               38.0       14.0
                                                 --------   --------
                                                     49.2       24.0
                                                 ========   ========
In aggregate                                        US$'m      US$'m

Dividends proposed in relation to the        8      489.0      475.2
year                                             ========   ========

Dividends paid in the year and                      485.0      236.6
deducted from net equity                         ========   ========

Turnover and operating profit are derived from continuing operations.


Consolidated Balance Sheet
                                                       At        At
                                                 31.12.07  31.12.06
                                            Notes   US$'m     US$'m
Non-current assets
Intangible assets                             9     207.7     205.3
Property, plant and equipment                10   2,679.8   2,373.7
Investment property                          11       3.5       3.2
Investment in associate                      12       2.5       3.5
Trade and other receivables                          32.0      39.3
Derivative financial instruments              4       1.4         -
Available for sale investments               14       3.3       6.2
Deferred tax assets                          19      14.7       3.1
                                                 --------  --------
                                                  2,944.9   2,634.3
                                                 --------  --------
Current assets
Inventories                                  15     130.3     120.3
Trade and other receivables                         540.4     510.1
Current tax assets                                   26.9       7.5
Derivative financial instruments              4       0.5       7.3
Cash and cash equivalents                    22   2,212.5   1,805.5
                                                 --------  --------
                                                  2,910.6   2,450.7
                                                 --------  --------

Total assets                                      5,855.5   5,085.0
                                                 ========  ========

Current liabilities
Short-term borrowings                     16,22    (101.8)    (97.6)
Derivative financial instruments              4      (1.4)        -
Trade and other payables                           (246.5)   (211.5)
Current tax liabilities                             (16.9)   (204.8)
                                                 --------  --------
                                                   (366.6)   (513.9)
                                                 --------  --------
Non-current liabilities
Medium and long term borrowings           16,22    (164.2)   (261.1)
Trade and other payables                             (2.6)     (4.8)
Post-employment benefit obligations          17     (29.1)    (24.1)
Long-term provisions                         18     (10.9)     (9.8)
Deferred tax liabilities                     19    (375.6)   (323.2)
                                                 --------  --------
                                                   (582.4)   (623.0)
                                                 --------  --------

Total liabilities                                  (949.0) (1,136.9)
                                                 ========  ========
                                                             

Net assets                                        4,906.5   3,948.1
                                                 ========  ========

Equity
Share capital                                20      89.8      89.8
Share premium                                20     199.2     199.2
Hedging, translation and fair value                  25.1      12.3
reserves
Retained earnings                                 3,750.9   2,853.8
                                                 --------  --------
Equity attributable to equity holders             4,065.0   3,155.1
of the Company

Minority interests                                  841.5     793.0
                                                 --------  --------
Total equity                                      4,906.5   3,948.1
                                                 ========  ========


The preliminary information was approved by the Board of Directors on 10 March
2008.

Consolidated Cash Flow Statement

                                                     Year      Year
                                                    ended     ended
                                                 31.12.07  31.12.06
                                            Notes   US$'m     US$'m

Cash flows from operations                   21   2,817.7   2,810.1
Interest paid                                       (20.2)    (24.6)
Dividends from associate                     12       2.4       0.4
Income tax paid                                    (806.0)   (498.2)
                                                 --------  --------
Net cash from operating activities                1,993.9   2,287.7
                                                 --------  --------

Investing activities
Acquisition of subsidiaries                  23         -    (487.5)
Disposal and part-disposal of                23       4.9      84.3
subsidiaries
Disposal of joint venture interest           13       6.0         -
Disposal of available for sale               14      16.6         -
investments
Recovery of Chilean VAT paid on                       8.8       8.7
purchase of water concession
Purchases of property, plant and                   (481.7)   (506.6)
equipment
Interest received                                   111.3      77.6
                                                 --------  --------
Net cash used in investing activities              (334.1)   (823.5)
                                                 --------  --------

Financing activities
Dividends paid to equity holders of                (485.0)   (236.6)
the Company
Dividends paid to preference                         (0.2)     (0.2)
shareholders of the Company
Dividends paid to minority interests               (681.2)   (630.6)
Net proceeds from issue of new               22       7.0       3.8
borrowings
Repayments of borrowings                     22     (99.3)   (109.6)
Repayments of obligations under              22      (0.9)     (1.8)
finance leases
                                                 --------  --------
Net cash used in financing activities             (1,259.6)  (975.0)
                                                 --------  --------
                                                  

Net increase in cash and cash                       400.2     489.2
equivalents                                      ========  ========

Cash and cash equivalents at beginning            1,805.5   1,316.8
of the year
Net increase in cash and cash                       400.2     489.2
equivalents
Effect of foreign exchange rate                       6.8      (0.5)
changes
                                                 --------  --------
Cash and cash equivalents at end of          22   2,212.5   1,805.5
the year                                         ========  ========



Consolidated Statement of Changes in Equity



For the years ended 31 December 2006 and 2007

                 Share   Share Hedging    Fair Translation  Retained       Net  Minority   Total
               capital premium reserve   value     reserve  earnings    equity interests
                                       reserve
                 US$'m   US$'m   US$'m   US$'m       US$'m     US$'m     US$'m     US$'m     US$'m

Balance at 1      16.6   272.4       -       -        16.6   1,736.1   2,041.7     721.3   2,763.0
January 2006

Profit for the       -       -       -       -           -   1,354.3   1,354.3     839.8   2,194.1
financial year

Currency             -       -       -       -        (4.3)        -      (4.3)        -      (4.3)
translation
adjustment

Acquisition of       -       -       -       -           -         -         -    (137.5)   (137.5)
minority
interest

Capitalisation    73.2   (73.2)      -       -           -         -         -         -         -
of share premium
on bonus issue
of ordinary
shares

Dividends            -       -       -       -           -    (236.6)   (236.6)   (630.6)   (867.2)
               -------  ------  ------  ------     -------    ------    ------    ------    ------
Balance at 31     89.8   199.2       -       -        12.3   2,853.8   3,155.1     793.0   3,948.1
December 2006
and 1 January
2007

Profit for the       -       -       -       -           -   1,382.1   1,382.1     729.7   2,111.8
financial year

Currency             -       -       -       -        13.5         -      13.5         -      13.5
translation
adjustment

Losses in fair
value of cash
flow hedges          -       -    (6.9)      -           -         -      (6.9)        -      (6.9)
deferred in
reserves

Losses in fair
value of cash
flow hedges
transferred to
the
income               -       -     6.7       -           -         -       6.7         -       6.7
statement

Gains in fair
value of
available for        -       -       -    10.0           -         -      10.0         -      10.0
sale
investments

Gains in fair
value of
of available
for sale
investments
transferred to
the income           -       -       -   (10.5)          -         -     (10.5)        -     (10.5)
statement

Deferred tax
effects
arising from
hedge                -       -       -       -           -         -         -         -         -
accounting

Dividends            -       -       -       -           -    (485.0)   (485.0)   (681.2)  (1,166.2)

               -------  ------  ------  ------     -------    ------    ------    ------    ------
Balance at 31     89.8   199.2    (0.2)   (0.5)       25.8   3,750.9   4,065.0     841.5   4,906.5
December 2007  =======  ======  ======  ======     =======    ======    ======    ======    ======



Notes

1.      General information and accounting policies

a)         General information

This preliminary results announcement is for the year ended 31 December 2007.
While the financial information contained in this preliminary results
announcement has been computed in accordance with International Financial
Reporting Standards ('IFRS'), this announcement does not itself contain
sufficient information to comply with IFRS. For these purposes, IFRS comprise
the Standards issued by the International Accounting Standards Board ('IASB')
and Interpretations issued by the International Financial Reporting
Interpretations Committee ('IFRIC') that have been endorsed by the European
Union. The Group will send its full financial statements that comply with IFRS
to shareholders in April 2008.

This preliminary results announcement does not constitute the Group's statutory
accounts as defined in section 240 of the Companies Act 1985 but is derived from
those accounts. The statutory accounts for the year ended 31 December 2007 have
been approved by the Board and will be delivered to the Registrar of Companies
following the Company's Annual General Meeting which will be held on 11 June
2008. The auditors have reported on those accounts and their report was
unqualified and did not contain statements under section 237(2) of the Companies
Act 1985 (regarding adequacy of accounting records and returns) or under section
237(3) (regarding provision of necessary information and explanations).

The information contained in this announcement for the year ended 31 December
2006 also does not constitute statutory accounts. A copy of the statutory
accounts for that year has been delivered to the Registrar of Companies. The
auditors' report on those accounts was unqualified and did not contain
statements under sections 237(2) or (3) of the Companies Act 1985.

The information contained in Notes 29 to 31 of this preliminary results
announcement is not derived from the statutory accounts for the years ended 31
December 2006 and 2007 and is accordingly not covered by the auditors' reports.

b)         Accounting policies and adoption of new accounting standards

This preliminary results announcement is derived from the statutory accounts for
the year ended 31 December 2007, which have been prepared on the basis of
accounting policies consistent with those applied in the financial statements
for the year ended 31 December 2006 except as follows:

(i)    The Group has applied the hedge accounting provisions of IAS 39
'Financial Instruments: Recognition and Measurement' with effect from 1 January
2007 as set out in Note 4(b). This change does not have any effect on prior year
comparatives.

(ii)   The Group has adopted IFRS 7 'Financial Instruments: Disclosures' and the
related amendment to IAS 1 'Presentation of Financial Statements'. The impact of
the adoption of IFRS 7 and the changes to IAS 1 has been to expand the
disclosures provided in these financial statements regarding the Group's
financial instruments and management of capital, and has not resulted in any
changes to the consolidated income statement, consolidated balance sheet or
consolidated cash flow statement.

2.      Total profit from operations and associates
                                          Year      Year
                                         ended     ended
                                      31.12.07  31.12.06
                                         US$'m     US$'m

Turnover                               3,826.7   3,870.0
Cost of sales                           (966.5)   (805.1)
                                      --------  --------
Gross profit                           2,860.2   3,064.9
Administrative expenses                 (183.1)   (152.6)
Closure provision                         (0.5)     (0.6)
Severance charges                         (5.3)     (7.7)
Exploration costs                        (38.1)    (21.5)
Other operating income                    31.2      10.3
Other operating expenses                 (11.0)    (88.7)
                                      --------  --------
Operating profit from subsidiaries and 2,653.4   2,804.1
joint ventures
Share of income from associate             1.4       1.1
                                      --------  --------
Total profit from operations and       2,654.8   2,805.2
associates                            ========  ========

(i)      In 2007, cost of sales includes an inventory write-off of US$18.8
million relating to high carbonate ore inventories at El Tesoro (see Note 15).

(ii)     In 2007, other operating income includes a gain of US$10.5 million
relating to the disposal of shares held in Mercator Minerals Ltd (see Note 14),
a gain of US$9.7 million relating to the disposal of the Cordillera de las Minas
joint venture to Panoro Minerals Ltd (see Note 13), and a gain of US$1.6 million
from a settlement in respect of the remaining consideration receivable for the
disposal of Minera Tamaya S.A. in 2002. These items totalled US$21.8 million.

(iii)    In 2006, other operating expenses included losses on commodity
derivatives prior to the application of the hedge accounting provisions of IAS
39 'Financial Instruments: Recognition and Measurement' with effect from 1
January 2007 (see Note 3(a)(viii) and Note 4(b)).

3.      Segmental analysis

Based on risks and returns, the Directors consider the primary reporting format
is by business segment and the secondary reporting format is by geographical
segment. The Group considers its business segments to be Los Pelambres, El
Tesoro, Michilla, Esperanza, exploration, railway and other transport services
and the water concession. Corporate and other items principally relate to the
costs incurred by the Company and Antofagasta Minerals S.A. (the Group's mining
corporate centre), which are not allocated to any individual business segment.
The classification reflects the Group's management structure. The amounts
presented for each business segment exclude any amounts relating to the
investment in Antofagasta Terminal Internacional S.A., an associate which is
held through the railway and other transport services segment.


a)       Turnover, EBITDA and operating profit /(loss) from subsidiaries and 
joint ventures analysed by business segment

                                                               Operating profit /
                                                                     (loss)
                                                                from subsidiaries
                          Turnover             EBITDA          and joint ventures
                         ----------           --------        --------------------
                        Year      Year      Year      Year  Year ended  Year ended
                       ended     ended     ended     ended    31.12.07    31.12.06
                    31.12.07  31.12.06  31.12.07  31.12.06
                       US$'m     US$'m     US$'m     US$'m       US$'m       US$'m

Los Pelambres        2,651.9   2,701.3   2,178.0   2,297.0     2,098.6     2,223.7
El Tesoro              673.9     664.8     430.9     456.0       380.3       409.9
Michilla               316.8     334.9     169.2     158.4       154.0       145.5
Exploration                -         -     (38.1)    (21.5)      (38.1)      (21.5)
Corporate and other        -         -      (5.6)    (16.9)       (6.8)      (17.6)
items                -------   -------   -------   -------     -------     -------
Mining               3,642.6   3,701.0   2,734.4   2,873.0     2,588.0     2,740.0
Railway and other      117.0     105.3      48.9      42.9        35.0        32.6
transport services
Water concession        67.1      63.7      40.7      41.4        30.4        31.5
                     =======   =======   =======   =======     =======     =======
Group turnover       3,826.7   3,870.0   2,824.0   2,957.3     2,653.4     2,804.1
(segment revenue),   =======   =======   =======   =======     =======     =======
EBITDA and operating
profit from
subsidiaries and 
joint ventures
(segment result)


Notes to turnover by business segment (segment revenue)


(i)      Turnover by business segment equates to segment revenue as defined by
IAS 14. Turnover from the railway and other transport services and the water
concession is stated after eliminating inter-segmental sales to the mining
division of US$10.5 million (2006 - US$9.6 million) and US$0.4 million (2006 -
nil) respectively.

(ii)     Turnover includes the effect of both final pricing and mark-to-market
adjustments to provisionally priced sales of copper and molybdenum concentrates
and copper cathodes. Further details of such adjustments are given in Note 4(a).

(iii)    Turnover in 2007 includes realised gains on commodity derivatives at El
Tesoro of US$0.2 million and realised losses at Michilla of US$14.2 million. The
classification of these amounts within turnover is due to the application of the
hedge accounting provisions of IAS 39 'Financial Instruments: Recognition and
Measurement' with effect from 1 January 2007. Prior to this point gains and
losses on commodity derivatives (including both gains and losses realised in a
period and period-end mark-to-market adjustments) were included in other
operating income or expense. Further details of such gains or losses are given
in Note 3(a)(viii) and Note 4(b).

(iv)     Los Pelambres produces and sells copper and molybdenum concentrates. It
is also credited for the gold and silver content in the copper concentrate it
sells. Turnover by type of metal is analysed below to show separately the
amounts prior to deduction of tolling charges, the tolling charges involved and
the net amounts included in turnover. El Tesoro and Michilla do not generate by-
products from their copper cathode operations.

(v)      On a Group basis, total copper revenues amounted to US$2,915.9 million
(2006 - US$3,144.7 million) comprising copper concentrate sales at Los Pelambres
of US$1,925.2 million (2006 - US$2,145.0 million) and copper cathode sales at El
Tesoro and Michilla of US$990.7 million (2006 - US$999.7 million).


Notes to EBITDA and operating profit from subsidiaries by business segment
(segment result)

(vi)    Operating profit for the separate businesses equates to segment result
as defined by IAS 14. This excludes the share of income from associate of US$1.4
million (2006 - US$1.1 million).

(vii)   EBITDA is calculated by adding back depreciation, amortisation and
disposals of property, plant and equipment and impairment charges (see Note
3(b)) to operating profit from subsidiaries and joint ventures.

(viii)  As explained in Note 3(a)(iii) above, in the current year EBITDA and
operating profit include realised gains on commodity derivatives at El Tesoro of
US$0.2 million and realised losses at Michilla of US$14.2 million (recorded
within turnover). In 2006 EBITDA and operating profit included losses on
commodity derivatives (including both losses realised in the year and year-end
mark-to-market adjustments) at El Tesoro of US$44.8 million, and losses at
Michilla of US$39.7 million (recorded within other operating expense).

(ix)    Exploration costs relating to Tethyan Copper Company Limited ('Tethyan')
(see Note 13) have been included within the Exploration category. All other
income and expenditure relating to Tethyan has been included within corporate
and other items.

(x)     As explained in Note 2(i) and Note 15, in 2007 EBITDA and operating
profit at El Tesoro include an inventory write-off of US$18.8 million.

(xi)    As explained in Note 2(ii), EBITDA and operating profit in the corporate
and other items category includes gains of US$21.8 million relating to various
items.


Turnover at Los Pelambres by mineral

                        Before deducting    Tolling charges  Net of tolling charges
                         tolling charges
                        ---------------------------------------------------------
                          Year      Year     Year     Year  Year ended  Year ended
                         ended     ended    ended    ended    31.12.07    31.12.06
                      31.12.07  31.12.06 31.12.07 31.12.06
                         US$'m     US$'m    US$'m    US$'m       US$'m       US$'m

Copper                 2,094.6   2,399.0   (169.4)  (254.0)    1,925.2     2,145.0
Molybdenum               699.8     536.4    (23.4)   (22.6)      676.4       513.8
Gold and silver           51.0      43.1     (0.7)    (0.6)       50.3        42.5
                       -------   -------  -------  -------     -------     -------
Los Pelambres          2,845.4   2,978.5   (193.5)  (277.2)    2,651.9     2,701.3
                       =======   =======  =======  =======     =======     =======


b)    Depreciation and amortisation, loss on disposal of property, plant and 
      equipment and capital expenditure by business segment

                     Depreciation and       Loss on disposals     Capital expenditure
                       amortisation       
                  -----------------------  --------------------- -----------------------
                 Year ended  Year ended Year ended Year ended  Year ended  Year ended
                   31.12.07    31.12.06   31.12.07   31.12.06    31.12.07    31.12.06
                      US$'m       US$'m      US$'m      US$'m       US$'m       US$'m

Los Pelambres         (79.3)      (72.8)      (0.1)      (0.5)      323.4       463.5
El Tesoro             (49.3)      (43.4)      (1.3)      (2.7)       28.0        16.3
Michilla              (11.2)      (10.4)      (4.0)      (2.5)       11.4         7.7
Esperanza                 -           -          -          -        43.7         6.6
Corporate and          (0.9)       (0.3)      (0.3)      (0.4)       15.2        13.9
other items         -------     -------    -------    -------     -------     -------
Mining               (140.7)     (126.9)      (5.7)      (6.1)      421.7       508.0
Railway and other     (11.3)       (8.4)      (2.6)      (1.9)       38.9        25.2
transport
services
Water concession      (10.2)       (9.7)      (0.1)      (0.2)        5.4         5.8
                    -------     -------    -------    -------     -------     -------
                     (162.2)     (145.0)      (8.4)      (8.2)      466.0       539.0
                    =======     =======    =======    =======     =======     =======


Capital expenditure represents purchases of property, plant and equipment stated
on an accruals basis (see Note 10) and may therefore differ from the amount
included in the cash flow statement.

Other non-cash expenses relate to severance and closure costs and are disclosed
for the Group in Note 2.



c)    Assets and liabilities by business segment

                          Segment assets      Segment liabilities   Segment net assets
                         ----------------    --------------------- --------------------
                           Year       Year       Year       Year       Year       Year
                          ended      ended      ended      ended      ended      ended
                       31.12.07   31.12.06   31.12.07   31.12.06   31.12.07   31.12.06
                          US$'m      US$'m      US$'m      US$'m      US$'m      US$'m
Los Pelambres           2,338.4    2,103.4     (137.9)    (125.5)   2,200.5    1,977.9
El Tesoro                 563.5      591.8      (61.1)     (53.3)     502.4      538.5
Michilla                   77.2       74.5      (28.8)     (24.8)      48.4       49.7
Esperanza                  92.8          -       (2.2)         -       90.6          -
Corporate and other       155.1      145.8      (21.4)     (12.3)     133.7      133.5
items                   -------    -------    -------    -------    -------     ------
Mining                  3,227.0    2,915.5     (251.4)    (215.9)   2,975.6    2,699.6
Railway and other         184.0      158.8      (27.7)     (25.2)     156.3      133.6
transport services
Water concession          181.1      181.7      (11.4)      (9.1)     169.7      172.6
                        -------    -------    -------    -------    -------     ------
                        3,592.1    3,256.0     (290.5)    (250.2)   3,301.6    3,005.8
                        =======    =======    =======    =======    =======     ======


Assets and liabilities of Tethyan Copper Company Limited (see Note 13) have been
included within corporate and other items.


Segment assets and liabilities are reconciled to entity assets and liabilities
through unallocated items as follows:

                          Segment assets      Segment liabilities   Segment net assets
                         ----------------    --------------------- --------------------
                           Year       Year       Year       Year       Year       Year
                          ended      ended      ended      ended      ended      ended
                       31.12.07   31.12.06   31.12.07   31.12.06   31.12.07   31.12.06
                          US$'m      US$'m      US$'m      US$'m      US$'m      US$'m
Segment assets/         3,592.1    3,256.0     (290.5)    (250.2)   3,301.6    3,005.8
(liabilities)
Investment property         3.5        3.2          -          -        3.5        3.2
Investment in               2.5        3.5          -          -        2.5        3.5
associate
Available for sale          3.3        6.2          -          -        3.3        6.2
investments
Deferred tax assets/       14.7        3.1     (375.6)    (323.2)    (360.9)    (320.1)
(liabilities)
Current tax assets/        26.9        7.5      (16.9)    (204.8)      10.0     (197.3)
(liabilities)
Cash and cash           2,212.5    1,805.5     (266.0)    (358.7)   1,946.5    1,446.8
equivalents/            -------    -------    -------    -------    -------     ------
(borrowings)
Entity assets/          5,855.5    5,085.0     (949.0)  (1,136.9)   4,906.5    3,948.1
(liabilities)           =======    =======    =======    =======    =======     ======


d) Geographical analysis of turnover by location of customer (geographical segment)

                                               Sales
                                              -------
                                            Year      Year
                                         ended       ended
                                       31.12.07   31.12.06
                                          US$'m      US$'m
Europe
         - United Kingdom                   0.1        8.1
         - Switzerland                    321.9      396.5
         - Rest of Europe                 742.1      877.1
Latin America
         - Chile                          377.8      407.5
         - Rest of Latin America          190.3      165.2
           
North America                             511.4      472.7

Asia
         - Japan                        1,000.6    1,008.2
         - China                          416.8      317.5
         - Rest of Asia                   265.7      213.5

Australia                                     -        3.7
                                       --------   --------
                                        3,826.7    3,870.0
                                       ========   ========


4.      Derivatives and embedded derivatives

a)    Embedded derivatives - provisionally priced sales


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 being based on the monthly average London Metal
Exchange copper price or monthly average molybdenum price for specified future
periods. This normally ranges from 30 to 180 days after delivery to the
customer.


Under IFRS, both gains and losses from the marking-to-market of open sales are
recognised through adjustments to turnover in the income statement and to trade
debtors in the balance sheet. The Group determines mark-to-market prices using
forward prices at each period end for copper concentrate and cathode sales, and
period-end month average prices for molybdenum concentrate sales due to the
absence of a futures market for that commodity. The mark-to-market adjustments
to the balance sheet at the end of each period are as follows:

                                         Balance sheet
                                   net mark to market effect
                                           on debtors
                                          ------------
                                  At 31.12.07   At 31.12.06
                                        US$'m         US$'m

Los Pelambres - copper concentrate      (72.8)       (110.1)
Los Pelambres - tolling charges          (5.1)          7.6
for copper concentrates
Los Pelambres - molybdenum                0.1          (2.4)
concentrate
El Tesoro - copper cathodes              (1.0)          1.3
Michilla - copper cathodes                0.1          (0.6)
                                     --------      --------
                                        (78.7)       (104.2)
                                     ========      ========





(i)   Copper sales
                                     Year     Year     Year        Year     Year     Year
                                    ended    ended    ended       ended    ended    ended
                                 31.12.07 31.12.07 31.12.07    31.12.06 31.12.06 31.12.06
                                    US$'m    US$'m    US$'m       US$'m    US$'m    US$'m

                                      Los       El Michilla         Los       El Michilla
                                Pelambres   Tesoro            Pelambres   Tesoro
                                   Copper   Copper   Copper      Copper   Copper   Copper
                              concentrate cathodes cathodes concentrate cathodes cathodes

Provisionally invoiced gross      2,041.8    678.8    332.2     2,175.5    653.1    326.0
sales

Effects of pricing adjustments
to previous year invoices
Reversal of mark-to-market          110.1     (1.3)     0.6       (33.2)    (0.2)     0.1
adjustments at the end of the
previous year
Settlement of copper sales          (88.1)    (6.5)    (3.3)      169.2      2.0      0.6
invoiced in the previous year

Total effect of adjustments to       22.0     (7.8)    (2.7)      136.0      1.8      0.7
previous year invoices in the
current year

Effects of pricing adjustments
to current year invoices
Settlement of copper sales          103.6      3.7      1.4       197.6      8.6      8.8
invoiced in the current year
Mark-to-market adjustments at       (72.8)    (1.0)     0.1      (110.1)     1.3     (0.6)
the end of the current year

Total effect of adjustments to       30.8      2.7      1.5        87.5      9.9      8.2
current year invoices

Realised gains/(losses) on              -      0.2    (14.2)          -        -        -
commodity derivatives

Turnover before deducting         2,094.6    673.9    316.8     2,399.0    664.8    334.9
tolling charges

Tolling charges                    (169.4)       -        -      (254.0)       -        -

Turnover net of tolling charges   1,925.2    673.9    316.8     2,145.0    664.8    334.9


Copper concentrate


Copper concentrate sales at Los Pelambres have an average settlement period of
approximately four months from shipment date. At 31 December 2007, sales
totalling 99,400 tonnes remained open as to price, with an average
mark-to-market price of 302.4 cents per pound compared with an average
provisional invoice price of 335.7 cents per pound. At 31 December 2006, sales
totalling 127,100 tonnes remained open as to price, with an average
mark-to-market price of 287.0 cents per pound compared with an average
provisional invoice price of 326.3 cents per pound.


Tolling charges include a mark-to-market loss for copper concentrate sales open
as to price at 31 December 2007 of US$5.1 million (31 December 2006 -
mark-to-market gain of US$7.6 million).


Copper cathodes


Copper cathode sales at El Tesoro and Michilla have an average settlement period
of approximately one month from shipment date. At 31 December 2007, sales
totalling 11,000 tonnes remained open as to price, with an average
mark-to-market price of 301.7 cents per pound compared with an average
provisional invoice price of 305.4 cents per pound. At 31 December 2006, sales
totalling 11,600 tonnes remained open as to price, with an average
mark-to-market price of 286.6 cents per pound compared with an average
provisional invoice price of 294.0 cents per pound.



(ii)  Molybdenum sales
                                                      Year        Year
                                                     ended       ended
                                                  31.12.07    31.12.06
                                                     US$'m       US$'m
                                                       Los         Los
                                                 Pelambres   Pelambres
                                                Molybdenum  Molybdenum
                                               concentrate concentrate

Provisionally invoiced gross sales                   670.9       547.8

Effects of pricing adjustments to previous year
invoices
Reversal of mark-to-market adjustments at the          2.4        12.6
end of the previous year
Settlement of molybdenum sales invoiced in the        (1.0)      (27.5)
previous year
Total effect of adjustments to previous year           1.4       (14.9)
invoices in the current year

Effects of pricning adjustments to current year
invoices
Settlement of molybdenum sales invoiced in the        27.4         5.9
current year
Mark-to-market adjustments at the end of the           0.1        (2.4)
current year
Total effect of adjustments to current year           27.5         3.5
invoices

Turnover before deducting tolling charges            699.8       536.4

Tolling charges                                      (23.4)      (22.6)

Turnover net of tolling charges                      676.4       513.8


Molybdenum sales at Los Pelambres have an average settlement period of
approximately three months after shipment date. At 31 December 2007, sales
totalling 2,100 tonnes remained open as to price, with an average mark-to-market
price of US$32.5 per pound compared with an average provisional invoice price of
US$32.4 per pound. At 31 December 2006, sales totalling 2,100 tonnes remained
open as to price, with an average mark-to-market price of US$25.0 per pound
compared with an average provisional invoice price of US$25.5 per pound.


b)    Derivative financial instruments


The Group uses derivative financial instruments to reduce exposure to foreign
exchange, interest rate and commodity price movements. The Group does not use
such derivative instruments for speculative trading purposes.

The Group has applied the hedge accounting provisions of IAS 39 'Financial
Instruments: Recognition and Measurement' with effect from 1 January 2007. From
that date, changes in the fair value of derivative financial instruments that
are designated and effective as hedges of future cash flows have been recognised
directly in equity, with such amounts subsequently recognised in the income
statement in the period when the hedged item affects profit or loss. Any
ineffective portion is recognised immediately in the income statement. Realised
gains and losses on commodity derivatives recognised in the income statement
have been recorded within turnover. The time value element of changes in the
fair value of derivative options is excluded from the designated hedging
relationship, and is therefore recognised directly in the income statement
within other finance items.

Prior to 1 January 2007 derivatives were measured at fair value through the
income statement, with gains or losses on commodity derivatives being recorded
within other operating income or expense.


(i) Commodity derivatives

The Group periodically uses commodity derivatives to reduce its exposure to the
copper price.

The balance sheet mark-to-market adjustments in respect of commodity derivatives
and the total effect on the income statement for each period (before taking into
account deferred tax in each case) are as follows:

                                          Balance sheet      Income statement
                                       Net financial asset     Total effect
                                      ---------------------   --------------
                                            At         At      Year      Year
                                      31.12.07   31.12.06     ended     ended
                                                           31.12.07  31.12.06
                                         US$'m      US$'m     US$'m     US$'m

El Tesoro                                    -          -       0.4     (44.8)
Michilla                                   0.5        7.3     (13.7)    (39.7)
                                      --------   --------  --------  --------
                                           0.5        7.3     (13.3)    (84.5)
                                      ========   ========  ========  ========
Analysed between:
Non-current assets                         1.4          -
Current assets                             0.5        7.3
Current liabilities                       (1.4)         -
                                        --------   --------
                                           0.5        7.3
                                        ========   ========


During the year ended 31 December 2007 a net loss of US$14.0 million was
recognised within turnover, comprising a gain of US$0.2 million at El Tesoro and
a loss of US$14.2 million at Michilla, in respect of derivative instruments
which matured during the year. A gain of US$0.7 million was recognised within
other finance items, comprising a gain of US$0.2 million at El Tesoro and a gain
of US$0.5 million at Michilla, in respect of the time value element of the
mark-to-market adjustments, which is excluded from the designated hedging
relationship. A loss of US$0.2 million was recognised within reserves, relating
to El Tesoro, in respect of the intrinsic value element of the mark-to-market
adjustments, which forms part of the designated effective hedging relationship.

During the year ended 31 December 2006 a loss of US$84.5 million was recognised
within other operating expenses, comprising US$44.8 million at El Tesoro and
US$39.7 million at Michilla. This comprised losses on derivatives which matured
in the year of US$136.3 million partly offset by mark-to-market gains of US$7.3
million at 31 December 2006 in respect of derivatives maturing after the year
end, and the reversal of opening mark to market losses of US$44.5 million.

At 31 December 2007, the Group had min/max instruments for 70,200 tonnes of
copper production (of which 60,000 tonnes relate to El Tesoro and 10,200 tonnes
relate to Michilla), covering a total period up to 31 December 2009. The
weighted average remaining period covered by these hedges calculated with effect
from 1 January 2008 is 11 months. The instruments have a weighted average floor
of 248.9 cents per pound and a weighted average cap of 389.2 cents per pound.

At 31 December 2007, the Group also had futures for 6,500 tonnes, to both buy
and sell copper production at El Tesoro, with the effect of swapping COMEX
prices for LME prices without eliminating underlying market price exposure,
covering a period to 31 January 2009. The remaining weighted average period
covered by these instruments was 7 months.

Between 31 December 2007 and the date of this report, Michilla entered into
further min/max instruments for 15,000 tonnes of copper production, covering a
total period up to 31 December 2008. The weighted average remaining period
covered by these hedges calculated with effect from 1 January 2008 is 7 months.
The instruments have a weighted average floor of 292.1 cents per pound and a
weighted average cap of 342.1 cents per pound.


(ii) Interest and exchange derivatives

There were no outstanding interest derivative instruments at 31 December 2007 or
2006. During the year ended 31 December 2006 a gain of US$0.3 million was
recognised within other finance items in respect of interest rate collars which
matured during the year.

There were no outstanding exchange derivative instruments at 31 December 2007 or
2006.




5.     Net finance income
                                          Year      Year
                                         ended     ended
                                      31.12.07  31.12.06
                                         US$'m     US$'m

Investment income
Interest receivable                      113.4      78.3
                                      --------  --------

Interest expense
Interest payable                         (19.8)    (24.6)
Amortisation of deferred finance costs    (0.4)     (0.4)
Preference dividends                      (0.2)     (0.2)
                                      --------  --------
                                         (20.4)    (25.2)
                                      --------  --------

Other finance items
Mark-to-market effect of derivatives         -       0.3
Time value effect of derivatives           0.7         -
Discount charge relating to provisions    (1.2)     (1.2)
Foreign exchange                           2.9       1.6
                                      --------  --------
                                           2.4       0.7
                                      --------  --------
                                      --------  --------
Net finance income                        95.4      53.8
                                      ========  ========


The discount charge relating to provisions has been reclassified from interest
expense to other finance items, and the prior year comparatives have been
restated accordingly. The reclassification has no effect on net finance income
in either year.


There was no interest capitalised in either year.

6.      Taxation

The tax charge for the year comprised the following:

                                     Year ended Year ended
                                       31.12.07   31.12.06
                                          US$'m      US$'m

Current tax charge
Corporate tax (principally first         (441.3)    (474.2)
category tax in Chile)
Mining tax (Royalty)                      (50.6)     (58.5)
Withholding tax provision                (135.3)     (61.9)
Exchange gains on corporate tax            28.5        2.4
balances                               --------   --------
                                         (598.7)    (592.2)
                                       --------   --------

Deferred tax charge
Corporate tax (principally first           (8.1)      (2.4)
category tax in Chile)
Mining tax (Royalty)                       (0.8)       1.9
Withholding tax provision                 (30.8)     (72.2)
                                       --------   --------
                                          (39.7)     (72.7)
                                       --------   --------

Total tax charge (Income tax expense)    (638.4)    (664.9)
                                       ========   ========


Current tax is based on taxable profit for the year. Deferred tax is the tax
expected to be payable or recoverable on temporary differences (i.e. differences
between the carrying amount of assets and liabilities in the financial
statements and the corresponding tax basis used in the computation of taxable
profit). Deferred tax is accounted for using the balance sheet liability method
and is provided on all temporary differences with certain limited exceptions.
The Group incurs withholding taxes on the remittance of profits from Chile and
the other countries in which it operates and deferred tax is provided on
undistributed earnings to the extent that remittance is probable in the
foreseeable future.


The rate of first category (i.e. corporation) tax in Chile was 17% for both 2007
and 2006. Los Pelambres, El Tesoro and Michilla are also subject to a mining tax
(royalty) which imposes an additional tax of 4% of tax-adjusted operating
profit. For 2006 and 2007, 50% of the mining tax could be offset against first
category tax and the remaining 50% was tax deductible (i.e. an allowable expense
in determining liability to first category tax). From 2008, when the ability to
offset will no longer be available, 100% of the mining tax will be tax
deductible. The effect is to increase the effective tax rate of these three
operations (before taking into account deductibility against corporation tax) by
approximately 2% in 2006 and 2007 and 4% thereafter.

The effective tax rate for 2007 was 23.2%, compared with the Chilean statutory
tax rate of 17.0%. This was principally due to the provision of withholding tax
of US$166.1 million, and the effect of the mining tax, which resulted in a
charge of US$51.4 million, partly offset by exchanges gains of US$28.5 million
on Chilean-peso denominated tax prepayments due to the weakening of the US
dollar during the year. In 2006, the effective tax rate was 23.3%, principally
due to the provision of withholding tax of US$134.1 million, and the mining tax
charge of US$56.6 million. In 2006, exchange gains did not have any significant
effect on the effective tax rate.


7.      Basic earnings per share

Basic earnings per share is calculated on profit after tax and minority interest
giving net earnings of US$1,382.1 million (2006 - US$1,354.3 million) and based
on 985,856,695 ordinary shares. There was no potential dilution of ordinary
shares in any period.


8.      Dividends

The Board will recommend a final dividend of 43.4 cents per ordinary share,
which comprises an ordinary dividend of 5.4 cents per share and a special
dividend of 38.0 cents per share. The interim dividend of 6.2 cents per share,
which comprised an ordinary dividend of 3.2 cents per share and a special
dividend of 3.0 cents per share, was paid on 11 October 2007. Together, this
gives total dividends proposed in relation to 2007 of 49.6 cents per share.


The final dividend proposed in relation to 2006 was 43.0 cents, which comprised
an ordinary dividend of 5.0 cents per share and a special dividend of 38.0 cents
per share. Together with the interim dividend that year of 5.2 cents per share,
which comprised an ordinary dividend of 3.2 cents per share and a special
dividend of 2.0 cents per share, this gave total dividends proposed in relation
to 2006 of 48.2 cents per share.


Dividends per share actually paid in the year and recognised as a deduction from
net equity under IFRS were 49.2 cents (2006 - 24.0 cents) being the interim
dividend for the year and the final dividend proposed in respect of the previous
year.


The final dividend will be paid on 12 June 2008 to shareholders on the register
at the close of business on 9 May 2008. Dividends are declared and paid gross.
The conversion rate for the final dividend of 43.4 cents to be paid in sterling
will be set on 13 May 2008.


Dividends are declared in US dollars but may be paid in either dollars or
sterling. Shareholders on the register of members with an address in the United
Kingdom receive dividend payments in sterling, unless they elect to be paid in
dollars. All other shareholders are paid by cheque in dollars, unless they have
previously instructed the Company's registrar to pay dividends by bank transfer
to a sterling bank account, or they elect for payment by cheque in sterling. The
Company's registrar must receive any such election before the record date of 9
May 2008.


9.      Intangible assets
                                     Concession Exploration Year ended Year ended
                                          right    licenses 31.12.07   31.12.06
                                        US$'m       US$'m      US$'m      US$'m

Balance at the beginning of the          90.3       115.0      205.3       97.7
period
Acquisition                                 -           -          -      230.0
Disposal                                    -           -          -     (115.0)
Amortisation                             (3.8)          -       (3.8)      (4.0)
Foreign currency exchange difference      6.2           -        6.2       (3.4)
                                     --------    --------   --------   --------
Balance at the end of the period         92.7       115.0      207.7      205.3
                                     ========    ========   ========   ========


The concession right relates to the 30-year concession to operate the water
rights and facilities in the Antofagasta Region of Chile which the Group's
wholly-owned subsidiary, Aguas de Antofagasta S.A., acquired in December 2003.
The intangible asset is being amortised on a straight-line basis over the life
of the concession.

The exploration licences relate to the Group's proportionate share of the full
unencumbered value attributed to the interest in exploration licences in the
Reko Diq prospect in the Chagai Hills region of south-west Pakistan acquired by
Tethyan Copper Company Limited in 2006 (see Note 23). This intangible asset will
be amortised in accordance with the Group's policy for mining properties when
the related mining properties enter into production.

10.  Property, plant and equipment
                              Mining    Railway      Water      Year      Year
                                      and other Concession     ended     ended
                                      transport             31.12.07  31.12.06
                               US$'m      US$'m      US$'m     US$'m     US$'m

Balance at the beginning of  2,180.2      124.9       68.6   2,373.7   1,820.0
the year
Additions                      421.7       38.9        5.4     466.0     539.0
Acquisition                        -          -          -         -     171.6
Depreciation                  (140.7)     (11.3)      (6.4)   (158.4)   (141.0)
Asset disposals                 (5.7)      (2.6)      (0.1)     (8.4)     (8.2)
Disposals                          -          -          -         -      (4.7)
Foreign currency exchange          -        2.1        4.8       6.9      (3.0)
difference                  --------   --------   --------  --------  --------
Balance at the end of the    2,455.5      152.0       72.3   2,679.8   2,373.7
year                        ========   ========   ========  ========  ========


11.  Investment property
                                          Year      Year
                                         ended     ended
                                      31.12.07  31.12.06
                                         US$'m     US$'m

Balance at the beginning of the year       3.2       3.4
Foreign currency exchange difference       0.3      (0.2)
                                        --------  --------
Balance at the end of the year             3.5       3.2
                                        ========  ========


Investment property represents the Group's forestry properties, which are held
for long-term potential and accordingly classified as investment property held
at cost.



12.  Investment in associate
                                           Year      Year
                                          ended     ended
                                       31.12.07  31.12.06
                                          US$'m     US$'m

Balance at the beginning of the year        3.5       2.8
                                         --------  --------
Share of profit before tax                  1.7       1.3
Share of tax                               (0.3)     (0.2)
                                         --------  --------
Share of income from associate              1.4       1.1

Dividends received                         (2.4)     (0.4)
                                         --------  --------
Balance at the end of the year              2.5       3.5
                                         ========  ========


The investment in associate refers to the Group's 30% interest in Antofagasta
Terminal Internacional S.A. ('ATI'), which operates a concession to manage
installations in the port of Antofagasta.



13.  Joint venture agreements

Cordillera de las Minas S.A.

The Group had a joint venture agreement, entered into during 2002, with
Companhia Vale do Rio Doce ('Vale') of Brazil, with the objective of developing
mineral exploration activities in a defined area of interest in southern Peru.
In March 2007 the Group agreed to sell its 50% interest in the joint venture
vehicle Cordillera de Las Minas S.A. ('CMSA') to Panoro Minerals Limited
('Panoro'), a company listed on the TSX Venture Exchange.

The agreement was subject to a number of conditions including financing by
Panoro and regulatory approvals. These conditions were fulfilled in June 2007
and the disposal was completed at that point. The fair value of the
consideration received, being US$6.0 million in cash plus six million common
shares in Panoro, was US$9.7 million. The joint venture had a nil carrying value
in the Group's balance sheet, and accordingly the disposal has resulted in a
gain of US$9.7 million being recognised during the period, recorded within other
operating income.

Tethyan Copper Company Limited

As explained in Note 23, in April 2006 the Group acquired 100% of the issued
share capital of Tethyan Copper Company Limited ('Tethyan'). In September 2006
the Group entered into a joint venture agreement with Barrick Gold Corporation
('Barrick Gold'), to establish a 50:50 joint venture in relation to Tethyan's
mineral interests in Pakistan. The Group's 50% share of the assets and
liabilities and results of the jointly controlled entity are included in the
consolidated balance sheet and in the consolidated income statement of the Group
under the proportionate consolidation method.



14.  Available for sale investments
                                           Year      Year
                                          ended     ended
                                       31.12.07  31.12.06
                                          US$'m     US$'m

Balance at the beginning of the year        6.2       0.1
Additions                                   3.7         -
Acquisition                                   -       5.6
Movements in fair value                    10.0       0.5
Disposal                                  (16.6)        -
                                       --------  --------
Balance at the end of the year              3.3       6.2
                                       ========  ========


Available for sale investments represent those investments which are not
subsidiaries, associates or joint ventures and are not held for trading
purposes.

The balance at 31 December 2006 included US$6.1 million related to the
investment in Mercator Minerals Ltd shares, acquired at a fair value of US$5.6
million through the acquisition of Equatorial Mining Limited in August 2006 (see
Note 23). These shares were disposed of during the current year, resulting in a
gain of US$10.5 million recognised in the income statement.

The addition during the year represents the shares in Panoro Minerals Limited
acquired as part consideration for the disposal of the Group's share of the
joint venture entity Cordillera de las Minas S.A. (see Note 13). The fair value
of these shares decreased by US$0.5 million during the year, and the fair value
of the shares at 31 December 2007 was US$3.2 million.

The fair value of the remaining available for sale investments of less than
US$0.1 million held by the Group at 31 December 2007 are mainly Chilean-peso
denominated and did not differ materially from cost at the year end.



15.  Inventories
                                           Year      Year
                                          ended     ended
                                       31.12.07  31.12.06
                                          US$'m     US$'m

Raw materials and consumables              41.1      36.6
Work in progress                           71.1      68.6
Finished goods                             18.1      15.1
                                       --------  --------
                                          130.3     120.3
                                       ========  ========

Work in progress includes US$9.6 million (2006 - US$25.3 million) related to
high carbonate ore inventories at El Tesoro of which US$5.3 million are expected
to be processed more than twelve months after the balance sheet date. During the
year a write-off of US$ 18.8 million was recorded in respect of these
inventories.

16.  Borrowings
                                            At        At
                                      31.12.07  31.12.06
                                         US$'m     US$'m

Los Pelambres
Corporate loans                         (229.0)   (305.3)
Other loans                               (4.7)     (9.5)
El Tesoro
Corporate loans                          (14.0)    (27.9)
Finance leases                            (0.1)     (0.2)
Michilla
Finance leases                            (0.1)     (0.9)
Railway and other transport services
Loans                                    (14.1)    (10.8)
Other
Preference shares                         (4.0)     (4.1)
                                      --------  --------
Total (see Note 22)                     (266.0)   (358.7)
                                      ========  ========

Loans at 31 December 2007 are shown net of deferred financing costs of US$1.0
million (2006 - US$1.5 million). The amount in relation to Los Pelambres was
US$1.0 million (2006 - US$1.4 million). The amount in relation to El Tesoro was
less than US$0.1 million (2006 - US$0.1 million).

Maturity of borrowings
                                            At        At
                                      31.12.07  31.12.06
                                         US$'m     US$'m
Short-term borrowings                   (101.8)    (97.6)
Medium and long-term borrowings         (164.2)   (261.1)
                                      --------  --------
Total (see Note 22)                     (266.0)   (358.7)
                                      ========  ========


Loans are predominantly floating rate. However the Group periodically enters
into interest rate derivative contracts to manage its exposure to interest
rates. As explained in Note 4(b) there were no such derivative contracts
outstanding at 31 December 2007 or 2006.


17.  Post-employment benefit obligation
                                          Year      Year
                                         ended     ended
                                      31.12.07  31.12.06
                                         US$'m     US$'m

Balance at the beginning of the year     (24.1)    (20.6)
Charge to operating profit in the year    (5.3)     (7.7)
Release of discount to net interest in    (0.7)     (0.8)
year
Utilised in the year                       3.1       4.2
Foreign currency exchange difference      (2.1)      0.8
                                        --------  --------
Balance at the end of the year           (29.1)    (24.1)
                                        ========  ========


The post employment benefit obligation relates to the provision for severance
indemnities which are payable when an employment contract comes to an end, in
accordance with normal employment practice in Chile and other countries in which
the Group operates. The severance indemnity obligation is treated as an unfunded
defined benefit plan, and the calculation is based on valuations performed by an
independent actuary.




18.  Long-term provisions
                                          Year      Year
                                         ended     ended
                                      31.12.07  31.12.06
                                         US$'m     US$'m

Balance at the beginning of the year      (9.8)     (9.8)
Charge to operating profit in the year    (0.5)     (0.6)
Release of discount to net interest in    (0.5)     (0.4)
the year
Acquisition                                  -      (0.8)
Disposal                                     -       0.8
Utilised in the year                         -       0.8
Foreign currency exchange difference      (0.1)      0.2
                                      --------  --------
Balance at the end of the year           (10.9)     (9.8)
                                      ========  ========

Analysed as follows:
Decommissioning and restoration          (10.4)     (9.4)
Termination of water concession           (0.5)     (0.4)
                                      --------  --------
Balance at the end of the year           (10.9)     (9.8)
                                      ========  ========


Decommissioning and restoration costs relate to the Group's mining operations.
Costs are estimated on the basis of a formal closure plan and are subject to
regular independent formal review. It is estimated that the provision will be
utilised over a period of up to 40 years based on current mine plans.


The provision for the termination of the water concession relates to the
provision for items of plant, property and equipment and working capital items
under Aguas de Antofagasta's ownership to be transferred to the previous
state-owned operator ESSAN at the end of the concession period, and is based on
the net present value of the estimated value of those assets and liabilities in
existence at the end of the concession.


19.  Deferred tax assets and liabilities
                                          Year      Year
                                         ended     ended
                                      31.12.07  31.12.06
                                         US$'m     US$'m

Net position at the beginning of the    (320.1)   (218.9)
year
Charge to tax on profit in year          (39.7)    (72.7)
Acquisition                                  -     (29.0)
Foreign currency exchange difference      (1.1)      0.5
                                      --------  --------
Net position at the end of the year     (360.9)   (320.1)
                                      ========  ========

Analysed between:
Deferred tax assets                       14.7       3.1
Deferred tax liabilities                (375.6)   (323.2)
                                      --------  --------
Net position                            (360.9)   (320.1)
                                      ========  ========


20.  Share capital and share premium

There was no change in share capital or share premium in the year ended 31
December 2007. During 2006 there was a 4-for-1 bonus issue of ordinary shares,
on 19 June 2006, which resulted in an increase in ordinary share capital of
US$73.2 million and a corresponding reduction in the share premium account.



21.  Reconciliation of profit before tax to net cash inflow from operating
     activities
                                          Year      Year
                                         ended     ended
                                      31.12.07  31.12.06
                                         US$'m     US$'m

Profit before tax                      2,750.2   2,859.0
Depreciation and amortisation            162.2     145.0
Loss on disposal of property, plant        8.4       8.2
and equipment
Profit on disposal of joint venture       (9.6)        -
interest
Profit on disposal of available for      (10.5)        -
sale investments
Net finance income                       (95.4)    (53.8)
Share of profit of associate              (1.4)     (1.1)
Increase in inventories                   (9.9)    (21.5)
Increase in debtors                      (11.7)   (135.5)
Increase in creditors and provisions      35.4       9.8
                                      --------  --------
Cash flows from operations             2,817.7   2,810.1
                                      ========  ========


22.  Analysis of changes in net cash

                           At 1.1.07 Cash flows     Other  Exchange        At
                                                                     31.12.07
                               US$'m      US$'m     US$'m     US$'m     US$'m

Cash and cash equivalents    1,805.5      400.2         -       6.8   2,212.5
                            --------   --------  --------  --------  --------

Bank borrowings due within     (96.7)      92.3     (97.0)     (0.2)   (101.6)
one year
Bank borrowings due after     (256.8)         -      96.6         -    (160.2)
one year
Finance leases due within       (0.9)       0.9      (0.2)        -      (0.2)
one year
Finance leases due after one    (0.2)         -       0.2         -         -
year
Preference shares               (4.1)         -         -       0.1      (4.0)
                            --------   --------  --------  --------  --------
Total borrowings              (358.7)      93.2      (0.4)     (0.1)   (266.0)
                            --------   --------  --------  --------  --------
Net cash                     1,446.8      493.4      (0.4)      6.7   1,946.5
                            ========   ========  ========  ========  ========

Net cash

Net cash at the end of each year was as follows:

                                  At        At
                            31.12.07  31.12.06
                               US$'m     US$'m

Cash and cash equivalents    2,212.5   1,805.5
Total borrowings              (266.0)   (358.7)
                            --------  --------
                             1,946.5   1,446.8
                            ========  ========


23.  Acquisitions and disposals


Year ended 31 December 2007

No acquisitions, disposals or part-disposals of subsidiaries or associates have
been made during the 2007. Details of acquisitions and related transactions
undertaken during 2006 are set out below.


Year ended 31 December 2006

On 20 April 2006 the Group acquired 100% of the issued share capital of Tethyan
Copper Company Limited ('Tethyan') for cash consideration (including transaction
costs) of US$170.4 million. On 22 September 2006, the Group entered into a 50:50
joint venture agreement with Barrick Gold Corporation ('Barrick Gold') in
relation to Tethyan's mineral interests in Pakistan. The Group disposed of 50%
of the issued share capital of Atacama Copper Pty Limited ('Atacama'), the
immediate parent company of Tethyan, to Barrick Gold for US$86.8 million.


On 24 August 2006 the Group acquired 100% of the issued share capital of
Equatorial Mining Limited ('Equatorial') for a cash consideration (including
transaction costs) of US$406.1 million. Equatorial's principal asset was a 39%
interest in Minera El Tesoro, in which the Group held the remaining 61% and
which it had accounted for as a subsidiary. The acquisition resulted in the
elimination of the minority interest of US$137.5 million recognised in the
Group's balance sheet immediately prior to acquisition.


On 11 December 2006, the Group entered into an agreement to dispose of
Equatorial Mining North America Inc. (EMNA), a wholly-owned subsidiary of
Equatorial Mining Limited, to Idaho General Mines Inc ('IGM'). EMNA and its
subsidiaries formerly owned and operated the Tonopah copper mine in Nevada, over
which they retained royalties. The consideration of US$4.9 million was received
in January 2007. No amount has been recognised in respect of the further
contingent consideration of US$6.0 million which is payable should production at
the Tonopah mine commence.



24.  Other transactions

During 2007, the Group decided not to continue with the exploration agreements
with Ascendent Copper Corporation in respect of the Chaucha deposit in Ecuador
and with AngloGold Ashanti in the area of interest in southern Colombia,
following a review of drilling results achieved to date. This decision does not
have any material impact on any of the amounts included within this
announcement.



25.  Contingent assets and liabilities

There are a number of claims currently outstanding to which Antofagasta plc or
its subsidiaries ('the Group') is a party, for which no provision has been made
in the financial statements and are currently not expected to result in any
material loss to the Group. Details of the principal claims are set out below:

a)   Los Pelambres - Mauro tailings dam

In November 2006, the Court of Appeals of Santiago upheld a challenge by
claimants in the Pupio Valley against the Chilean Water Authority (Direccion
General de Aguas) in relation to the award of one of the sectoral permits issued
during 2005 for the construction of the Mauro tailings dam by Los Pelambres. The
Court of Appeals has rejected four requests by the claimants that work on the
dam should be suspended. This has enabled Los Pelambres to continue construction
pending a final resolution by the Chilean Supreme Court, where Los Pelambres has
sought to reverse the November decision as an affected party together with the
Direccion General de Aguas. The Group believes that Los Pelambres has received
all the necessary technical and legal permits and that these have been properly
applied for and granted entirely in accordance with the applicable regulations.
It is confident that this view will be upheld by the Chilean Supreme Court.

On 19 April 2007 a first instance court in Santiago upheld a claim relating to a
purchase agreement entered into in 1992 between two former owners of land in the
area of the Mauro tailings dam, in which the validity of that purchase agreement
was challenged by the plaintiff seller. Los Pelambres, which acquired the land
in 2001, participated in this trial to protect its interest and has appealed
against this decision to the Court of Appeals of Santiago. The appeal has the
effect of suspending the effect of the first instance resolution. The Group is
confident that Los Pelambres' legal title to the land in question will be upheld
on appeal. On 18 May 2007 the Court rejected a second petition by the plaintiff
in that case that works on the Mauro tailings dam should cease immediately,
confirming Los Pelambres' right to complete its construction. The court
nevertheless has held that operation of the dam by depositing tailings cannot
for the moment commence.

On 24 August 2007, a first instance court in Los Vilos notified Los Pelambres of
a new claim made by the same individuals involved in other litigation against
the Mauro tailings dam. The claim was filed earlier the same week and Los
Pelambres was neither notified of nor represented in the hearing. The court also
notified Los Pelambres of an order to suspend those works which directly affect
the Pupio stream. Los Pelambres believes that it has obtained all the necessary
approvals and permits for the construction of the Mauro tailings, which was
98.5% complete at the end of 2007.

There are other claims at first instance currently in the Chilean courts against
governmental authorities. These claims are not against Los Pelambres, but in
some cases the company has intervened in case an eventual judgement affects the
project.

Current operations are unaffected as the Quillayes dam which is expected to have
capacity until early 2009 remains in use.

b)   Tethyan Copper Company Limited - Chagai Hills Exploration Joint Venture

On 26 June 2007 the High Court of Balochistan at Quetta dismissed a petition
which had sought to declare that the Chagai Hills Exploration Joint Venture of
1993 and the exploration licences granted to Tethyan were null and void and
overturned an injunction passed earlier by the Court. The petition had been
filed in November 2006 and was directed at several parties including the Group,
the Government of Pakistan and the Government of Balochistan.

The petitioners have filed a Civil Petition for Leave to Appeal ('CPLA') against
the judgment and this will be heard by the Supreme Court to decide whether the
appeal should be heard on its merits.

c)   Equatorial Mining Limited - Errigal

In July 2006, Equatorial Mining Limited ('Equatorial') received notice of a
claim by Errigal Limited in the New South Wales Supreme Court. Errigal claims
that it is a former minority shareholder in one of Equatorial's subsidiaries
whose interest was acquired by Equatorial in 1993. The claim is for amounts
payable under the 1993 acquisition agreement. The Group does not agree with the
interpretation of the 1993 agreement advanced by Errigal and the action will
continue to be defended vigorously.



26.  Related party transactions

The ultimate parent company of the Group is Metalinvest Establishment, which is
controlled by the E. Abaroa Foundation, in which members of the Luksic family
are interested. The Company's subsidiaries, in the ordinary course of business,
enter into various sale and purchase transactions with companies also controlled
by members of the Luksic family, including Banco de Chile S.A., Madeco S.A. and
Compania Cervecerias Unidas S.A., which are subsidiaries of Quinenco S.A., a
Chilean industrial and financial conglomerate the shares of which are traded on
the Santiago Stock Exchange. These transactions, all of which were on normal
commercial terms, are in total not considered to be material.

The Group holds a 51% interest in Antomin Limited, which owns a number of copper
exploration properties in Chile's II and IV Regions. These include (but are not
limited to) Buey Muerto, some properties in the Sierra Gorda district (including
Tesoro North-East) and a small proportion of the Esperanza project. The Group
acquired its interest in Antomin Limited pursuant to an agreement in 2001 for a
nominal consideration from Mineralinvest Establishment, a company controlled by
the Luksic family, which continues to hold the remaining 49% of Antomin Limited.
Under the terms of the acquisition agreement, the Group committed to meet in
full the exploration and pre-feasibility costs relating to these properties.
During the year the Group incurred US$3.1 million (2006 - US$1.5 million) of
exploration and pre-feasibility costs in respect of these properties. The
cumulative amount incurred to 31 December 2007 was US$11.8 million (2006 -
US$8.7 million).

In September 2006 the Group entered into a joint venture agreement with Barrick
Gold Corporation ('Barrick Gold') to establish a 50:50 joint venture over
Tethyan's mineral interests in Pakistan. During the year the Group contributed
US$15.1 million to Tethyan to provide funds for Tethyan's on-going exploration
programme. The balance due from Tethyan to Group companies at the end of the
year was US$2.2 million (2006 - nil).

The Group has a 30% interest in Antofagasta Terminal Internacional S.A. ('ATI'),
which is accounted for as an associate. The Group received dividends during the
period of US$2.4 million (2006 - US$0.4 million), as disclosed in the
Consolidated Cash Flow Statement.



27.  Currency translation

Assets and liabilities denominated in foreign currencies are translated into
dollars and sterling at the year end rates of exchange. Results denominated in
foreign currencies have been translated into dollars at the average rate for
each year.

Year end rates Average rates

31.12.07 US$1.9912 = £1; US$1 = Ch$497 US$2.0004 = £1; US$1 = Ch$523

31.12.06 US$1.9569 = £1; US$1 = Ch$532 US$1.8386 = £1; US$1 = Ch$530


28.  Distribution

The Annual Report and Financial Statements for the year ended 31 December 2007,
together with the Notice of the 2008 Annual General Meeting, will be posted to
all shareholders in April 2008. The Annual General Meeting will be held at
Church House Conference Centre, Dean's Yard, Westminster, London SW1P 3NZ at
10.30 a.m. on Wednesday, 11 June 2008.


29.  Production and Sales Statistics (not subject to audit or review)

(See notes following Note 29(b).)

a)   Production and sales volumes for copper and molybdenum

                                          Production             Sales
                                         ------------           -------
                                         Year      Year      Year      Year
                                        ended     ended     ended     ended
                                     31.12.07  31.12.06  31.12.07  31.12.06
                                          000       000       000       000
                                       tonnes    tonnes    tonnes    tonnes

Copper
Los Pelambres                           289.9     324.2     289.4     324.8
El Tesoro                                93.0      94.0      93.3      95.3
Michilla                                 45.1      47.3      45.8      47.7
                                     --------  --------  --------  --------
Group total                             428.1     465.5     428.5     467.8
                                     ========  ========  ========  ========

Molybdenum
Los Pelambres                            10.2       9.8      10.0       9.9
                                     ========  ========  ========  ========


b)   Cash costs per pound of copper produced and realised prices per pound of 
     copper and molybdenum sold

                                          Cash costs        Realised prices
                                         ------------      -----------------
                                         Year      Year      Year      Year
                                        ended     ended     ended     ended
                                     31.12.07  31.12.06  31.12.07  31.12.06
                                     US cents  US cents  US cents  US cents

Copper
Los Pelambres                           (10.8)     16.4     328.3     335.0
El Tesoro                               109.8      78.6     327.6     316.4
Michilla                                143.5     126.4     313.8     318.5
                                     --------  --------  --------  --------
Group weighted average (net of           31.6      40.2     326.6     329.5
by-products)                         ========  ========  ========  ========

Group weighted average (before          110.7      95.6
deducting by-products)               ========  ========

Cash costs at Los Pelambres comprise:
On-site and shipping costs               76.3      56.4
Tolling charges for concentrates         29.6      39.7
                                     --------  --------
Cash costs before deducting             105.9      96.1
by-product credits
By-product credits (principally        (116.7)    (79.7)
molybdenum)                          --------  --------
Cash costs (net of by-product           (10.8)     16.4
credits)                             ========  ========

LME average                                                 323.3     305.3
                                                         ========  ========
                                                              US$       US$
Molybdenum
Los Pelambres                                                31.7      24.6
                                                         ========  ========
Market average price                                         30.2      24.8
                                                         ========  ========


Notes to the production and sales statistics


(i)    The production and sales figures represent the actual
amounts produced and sold, not the Group's share of each mine. The Group owns
60% of Los Pelambres, 100% of El Tesoro (61% prior to 24 August 2006) and 74.2%
of Michilla.


(ii)   Los Pelambres produces copper and molybdenum concentrates,
and the figures for Los Pelambres are expressed in terms of payable metal
contained in concentrate. Los Pelambres is also credited for the gold and silver
contained in the copper concentrate sold. El Tesoro and Michilla produce
cathodes with no by-products.


(iii)  Cash costs are a measure of the cost of operational
production expressed in terms of cents per pound of payable copper produced.
Cash costs are stated net of by-product credits and include tolling charges for
concentrates at Los Pelambres. Cash costs exclude depreciation, financial income
and expenses, hedging gains and losses, exchange gains and losses and
corporation tax for all three operations. By-product calculations do not take
into account mark-to-market gains for molybdenum at the beginning or end of each
year.

(iv)   Excluding by-product credits (which are reported as part of turnover) and
tolling charges for concentrates (which are deducted from turnover), weighted
average cash costs for the Group (comprising on-site and shipping costs in the
case of Los Pelambres and cash costs in the case of the other two operations)
increased from 68.0 cents per pound in 2006 to 90.6 cents per pound in 2007.

(v)    Realised copper prices are determined by comparing turnover from copper
sales (grossing up for tolling charges for concentrates) with sales volumes for
each mine in the period. Realised molybdenum prices at Los Pelambres are
calculated on a similar basis. In the current year realised prices reflect gains
and losses on commodity derivatives, which are included within turnover. The
classification of these amounts within turnover is due to the application of the
hedge accounting provisions of IAS 39 'Financial Instruments: Recognition and
Measurement' with effect from 1 January 2007. Prior to this point, gains and
losses on commodity derivatives were included in other operating income or
expense, and so are not reflected within the realised price figures for 2006.

(vi)   The totals in the tables above may include some small apparent
differences as the specific individual figures have not been rounded.

(vii)  The production information in Note 29(a) and the cash cost information in
Note 29(b) is derived from the Group's production report for the fourth quarter
of 2007, published on 31 January 2008.


30.  Summary of mining companies' Chilean GAAP financial statements (not subject
to audit or review)

The Group's three mining companies, Los Pelambres, El Tesoro and Michilla, will
file financial statements under Chilean GAAP for the year ended 31 December 2007
with the Chilean securities regulator, the Superintendencia de Valores y Seguros
de Chile ('SVS') on 28 March 2008. These filings are in accordance with the
Chilean mining tax legislation which requires companies that have elected to
enter a tax stability regime to publish financial information on a quarterly
basis from the 2006 financial year.


The balance sheets, income statements and cash flow statements prepared under
Chilean GAAP and to be filed with the SVS are summarised below.

(a) Balance sheets
                               Los       Los       El       El Michilla Michilla
                         Pelambres Pelambres   Tesoro   Tesoro
                                At        At       At       At       At       At
                          31.12.07  31.12.06 31.12.07 31.12.06 31.12.07 31.12.06
                             US$'m     US$'m    US$'m    US$'m    US$'m    US$'m

Cash and cash equivalents    164.2     485.3    534.3    219.0     43.1     69.5
Trade and other              323.0     365.1     67.0     53.0     32.1     17.0
receivables
Inventories                   74.6      46.6     37.0     53.8     16.3     18.1
Current and deferred tax      93.1      29.9      4.9      2.5      3.5      2.6
assets                     -------   -------  -------  -------  -------  -------

Current assets               654.9     926.9    643.2    328.3     95.0    107.2

Fixed assets               1,753.7   1,504.8    261.7    258.1     43.1     54.6

Other non-current assets     148.4     152.2     38.7     51.4      1.7      0.7
                           -------   -------  -------  -------  -------  -------

TOTAL ASSETS               2,557.0   2,583.9    943.6    637.8    139.8    162.5
                           =======   =======  =======  =======  =======  =======

Short term borrowings        (82.0)    (82.5)   (14.1)   (14.2)       -        -
Trade and other payables    (167.1)   (154.6)   (51.9)   (43.4)   (25.7)   (20.5)
Current and deferred tax         -    (110.7)    (4.0)   (36.0)    (9.0)   (15.5)
liabilities                -------   -------  -------  -------  -------  -------

Current liabilities         (249.1)   (347.8)   (70.0)   (93.6)   (34.7)   (36.0)
                           -------   -------  -------  -------  -------  -------

Medium and long term        (153.3)   (234.8)       -    (14.0)       -        -
borrowings
Trade and other payables     (15.9)    (12.2)    (8.0)    (6.5)    (8.7)    (7.5)
Deferred tax liabilities    (153.5)   (138.8)   (34.0)   (31.6)       -        -
                           -------   -------  -------  -------  -------  -------

Non-current liabilities     (322.7)   (385.8)   (42.0)   (52.1)    (8.7)    (7.5)
                           -------   -------  -------  -------  -------  -------

Total liabilities           (571.8)   (733.6)  (112.0)  (145.7)   (43.4)   (43.5)
                           -------   -------  -------  -------  -------  -------

Share capital               (373.8)   (373.8)   (91.0)   (91.0)   (78.4)   (78.4)
Reserves                  (1,611.4) (1,476.5)  (740.6)  (401.1)   (18.0)   (40.6)
                           -------   -------  -------  -------  -------  -------
                           
Total shareholders' equity (1,985.2) (1,850.3) (831.6)  (492.1)   (96.4)  (119.0)
                           -------   -------  -------  -------  -------  -------
                             
                            =======   =======  =======  =======  =======  =======
TOTAL LIABILITIES AND      (2,557.0) (2,583.9) (943.6)  (637.8)  (139.8)  (162.5)
SHAREHOLDERS' EQUITY
                           =======   =======  =======  =======  =======  =======

(b) Income statements
                               Los       Los       El       El Michilla Michilla
                         Pelambres Pelambres   Tesoro   Tesoro
                              Year      Year     Year     Year     Year     Year
                             ended     ended    ended    ended    ended    ended
                          31.12.07  31.12.06 31.12.07 31.12.06 31.12.07 31.12.06
                             US$'m     US$'m    US$'m    US$'m    US$'m    US$'m
 
Turnover                   2,656.9   2,726.9    673.9    603.2    323.9    260.5

Operating costs             (470.9)   (403.7)  (244.1)  (178.6)  (157.7)  (142.3)
                           -------   -------  -------  -------  -------  -------

Operating margin           2,186.0   2,323.2    429.8    424.6    166.2    118.2

Administrative and           (92.9)    (77.1)   (31.3)   (27.2)   (15.4)   (13.2)
distribution expenses      -------   -------  -------  -------  -------  -------

Operating profit           2,093.1   2,246.1    398.5    397.4    150.8    105.0
                           -------   -------  -------  -------  -------  -------

Other income                   7.8       0.8      2.3      0.3     10.3      0.8
Financial income              29.9      36.1     22.4      4.8      3.6      1.9
Financial expenses           (18.1)    (21.9)    (2.0)    (3.0)    (0.2)    (0.3)
Other expenses                (2.3)     (2.0)    (5.2)    (2.1)    (9.3)    (0.6)
Exchange difference           30.4       4.7      1.2      1.5      0.8      0.7
                           -------   -------  -------  -------  -------  -------

Net non-operating income      47.7      17.7     18.7      1.5      5.2      2.5
                           -------   -------  -------  -------  -------  -------

Profit before tax          2,140.8   2,263.8    417.2    398.9    156.0    107.5

Income tax expense          (399.4)   (419.1)   (77.7)   (75.2)   (29.3)   (21.5)
                             -------   -------  -------  -------  -------  -------

Profit for the financial   1,741.4   1,844.7    339.5    323.7    126.7     86.0
year                         =======   =======  =======  =======  =======  =======

(c) Cash flow statements
                               Los       Los       El       El Michilla Michilla
                         Pelambres Pelambres   Tesoro   Tesoro             
                              Year      Year     Year     Year     Year     Year
                             ended     ended    ended    ended    ended    ended
                          31.12.07  31.12.06 31.12.07 31.12.06 31.12.07 31.12.06
                             US$'m     US$'m    US$'m    US$'m    US$'m    US$'m

Net cash flow from         1,662.8   1,896.8    359.5    352.2    135.0    112.0
operating activities       -------   -------  -------  -------  -------  -------

Investing activities
Additions to fixed assets   (303.4)   (442.2)   (30.2)   (13.7)   (11.4)    (7.8)
Disposals of fixed assets      7.3       1.4        -        -      0.3      0.1
Other loans to related           -         -        -        -     (0.9)       -
companies                  -------   -------  -------  -------  -------  -------

Net cash used in investing  (296.1)   (440.8)   (30.2)   (13.7)   (12.0)    (7.7)
activities                 -------   -------  -------  -------  -------  -------

Financing activities
Dividends paid             (1,606.4) (1,450.0)      -    (95.0)  (149.4)   (50.0)

Loans repaid                 (81.4)    (81.4)   (14.0)   (28.0)       -        -
                           -------   -------  -------  -------  -------  -------

Net cash used in financing (1,687.8) (1,531.4)  (14.0)  (123.0)  (149.4)   (50.0)
activities                 -------   -------  -------  -------  -------  -------
                            

Net (decrease)/increase in  (321.1)    (75.4)   315.3    215.5    (26.4)    54.3
cash and cash equivalents

Cash and cash equivalents    485.3     560.7    219.0      3.5     69.5     15.2
at the beginning of the    -------   -------  -------  -------  -------  -------
year

Cash and cash equivalents    164.2     485.3    534.3    219.0     43.1     69.5
at the end of the year     =======   =======  =======  =======  =======  =======

Notes to Chilean GAAP financial statements

(i)    The above balance sheets, income statements and cash flow statements have
been derived from the financial statements of Los Pelambres, El Tesoro and
Michilla for the year ended 31 December 2007 to be filed with the SVS in Chile
on 28 March 2008. Certain detailed lines in the individual statements have been
combined.

(ii)   The balance sheets, income statements and cash flow statements above have
been prepared under Chilean GAAP and therefore do not necessarily equate to the
amounts that would be included in the Group's consolidated financial statements
for a corresponding period either as to measurement or classification.

(iii)  The amounts disclosed above represent the full amount for each company
and not the Group's attributable share. The Group owns 60% of Los Pelambres,
100% of El Tesoro (61% prior to 24 August 2006) and 74.2% of Michilla.

(iv)   A translation into English of the full financial statements as filed with
the SVS for each company shown in summary form above will be available on the
Group's website www.antofagasta.co.uk after these have been filed.


31.  Reconciliation of Chilean GAAP results to Turnover and EBITDA under IFRS
for individual business segments

(a) Turnover
                                  Los       Los       El       El Michilla Michilla
                            Pelambres Pelambres   Tesoro   Tesoro
                                 Year      Year     Year     Year     Year     Year
                                ended     ended    ended    ended    ended    ended
                             31.12.07  31.12.06 31.12.07 31.12.06 31.12.07 31.12.06
                      Notes     US$'m     US$'m    US$'m    US$'m    US$'m    US$'m

Chilean GAAP -                2,656.9   2,726.9    673.9    603.2    323.9    260.5
Turnover

Mark-to-market of     29(i)      (5.0)    (25.6)       -     (0.2)       -        -
provisionally priced
sales
Reclassification of    29           -         -        -     61.8     (7.1)    74.4
realised (gains)/     (ii)    -------   -------  -------  -------  -------  -------
losses on commodity
derivatives to other
operating expense/
reserves

IFRS - Turnover               2,651.9   2,701.3    673.9    664.8    316.8    334.9
                              =======   =======  =======  =======  =======  =======


(b) EBITDA
                                  Los       Los       El       El Michilla Michilla
                            Pelambres Pelambres   Tesoro   Tesoro
                                 Year      Year     Year     Year     Year     Year
                                ended     ended    ended    ended    ended    ended
                             31.12.07  31.12.06 31.12.07 31.12.06 31.12.07 31.12.06
                      Notes     US$'m     US$'m    US$'m    US$'m    US$'m    US$'m

Chilean GAAP - Operating      2,093.1   2,246.1    398.5    397.4    150.8    105.0
profit

Depreciation &                   78.5      72.2     41.3     35.3     23.0     15.2
amortisation                  -------   -------  -------  -------  -------  -------

Chilean GAAP - EBITDA         2,171.6   2,318.3    439.8    432.7    173.8    120.2

Mark-to-market of     29(i)      (5.0)    (25.6)       -     (0.2)       -        -
provisionally priced
sales

Mark-to-market of      29           -       0.3        -     17.0     (7.1)    34.8
financial derivatives (ii)

Other IFRS and         29        11.4       4.0     (8.9)     6.5      2.5      3.4
consolidation         (iii)   -------   -------  -------  -------  -------  -------
adjustments

IFRS - EBITDA                 2,178.0   2,297.0    430.9    456.0    169.2    158.4
                              =======   =======  =======  =======  =======  =======


Notes to reconciliation of turnover and EBITDA

(i)    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 being based on the monthly average London Metal
Exchange copper price or monthly average molybdenum price for specified future
periods. This normally ranges from 30 to 180 days after delivery to the
customer.

Under Chilean GAAP, the Group's accounting treatment is to value sales, which
remain open as to final pricing at the period end, in aggregate at the lower of
provisional invoice prices and mark-to-market prices at the balance sheet date.
Mark-to-market adjustments in respect of tolling charges (whether positive or
negative) are not taken into account. The Group determines mark-to-market prices
using forward prices at each period end for copper concentrate and cathode
sales, and period-end month average prices for molybdenum concentrate sales due
to the absence of a futures market for that commodity.

Under IFRS, both gains and losses from the marking-to-market of open sales are
recognised through adjustments to turnover in the income statement and to trade
debtors in the balance sheet. Under IFRS, the Group determines mark-to-market
prices in the same way as under Chilean GAAP for gross sales and mark-to-market
adjustments are also recognised in respect of tolling charges.

This results in a GAAP adjustment in cases where the mark-to-market prices are
higher than the provisional invoice prices. For Los Pelambres this results in a
loss of US$5.1 million in respect of copper concentrate sales (principally in
respect of tolling charges), and a credit of US$0.1 million in respect of
molybdenum concentrate sales. The adjustment in respect of El Tesoro and
Michilla is nil.


(ii)    The Group uses derivative financial instruments to reduce exposure to
commodity price movements. The Group does not use such derivative instruments
for trading purposes.

Under Chilean GAAP, such derivatives are held off the balance sheet. Gains or
losses on derivative instruments are matched in the income statement against the
item intended to be hedged. Such gains or losses are reflected by way of
adjustment to turnover.

The Group has applied the hedge accounting provisions of IAS 39 'Financial
Instruments: Recognition and Measurement' with effect from 1 January 2007. From
that date, changes in the fair value of derivative financial instruments that
are designated and effective as hedges of future cash flows have been recognised
directly in equity, with any ineffective portion recognised immediately in the
income statement. Realised gains and losses on commodity derivatives recognised
in the income statement have been recorded within turnover. Prior to 1 January
2007 derivatives were measured at fair value through the income statement, with
gains or losses on commodity derivatives being recorded within other operating
income or expense. For the comparative periods, any amounts included in turnover
under Chilean GAAP were reclassified accordingly.


(iii)   Other IFRS and consolidation adjustments relate mainly to amortisation
of consolidation fair value adjustments and are not material either individually
or in aggregate.











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