Repairs to a faulty SAG mill at Chilean copper mine Escondida will be completed mid-August, bringing the mine's Laguna Seca concentrator plant back to capacity, a BHP Billiton Ltd. (BHP) executive said Tuesday.

According to Escondida's initial estimates, some 15% of concentrate production at the mine was lost because of the problem at the Laguna Seca SAG mill, which crushes copper-containing ore into smaller pieces. Cathode production at the mine wasn't hurt.

Mill repairs begain in July and will be completed in the 45-day repair schedule, Diego Hernandez, chief executive of BHP's Base Metals Division, told reporters.

BHP holds a 57.5% stake in Escondida and acts as its operator, while Rio Tinto PLC (RTP) currently holds a 30% stake. A Japanese consortium made up of Mitsubishi Corp. (8058.TO) (60%), Mitsubishi Materials Corp. (5711.TO) (20%), and Nippon Mining & Metals Co. (JJD-MMM) (20%), hold a total 10% stake in Escondida, while International Finance Corp. (IFC.KW), the private sector unit of the World Bank, has the remaining 2.5% interest.

Production at Escondida fell 30% on the year in the first quarter of 2009 to 234,229 metric tons of copper, due to the combined effect of lower ore head grade, increased hardness of the ore treated which resulted in lower copper recovery, and the production problems at the Laguna Seca concentrator plant.

As to upcoming labor talks at Escondida, Hernandez said labor negotiations with Union No. 1, whose contracts expire in early December, will likely start on schedule on October.

"In all likelyhood, (talks) will follow the legally established terms," Hernandez, hinting that the company won't push talks forward.

In 2006, the Escondida Union No. 1 walked off the job for almost a month, bringing production to a standstill while labor talks dragged on.

-By Carolina Pica, Dow Jones Newswires; 56-2-820-4244; carolina.pica@dowjones.com