Peruvian miner Compania de Minas Buenaventura (BVN) plans to start producing copper at its Colquijirca mine this year and is also advancing on the expansion of its silver facilities at Uchucchacua, company chief executive Roque Benavides said Thursday.

The official made his remarks in a conference call to discuss second-quarter results. Buenaventura posted net profit of $138.1 million for the period, up from $77.2 million in the year-earlier quarter.

Benavides said copper production at Colquijirca, which currently produces zinc, should start during the first week of October. The output estimate is 90 tons of copper concentrate a day with 18% to 20% grade copper, Benavides said.

In the meantime, an $850 million expansion project at copper producer Sociedad Minera Cerro Verde should be completed by October, with full operations starting in early 2007, Benavides said. Buenaventura has a 18.214% participation in Cerro Verde. The completed facilities will process 200,000 tons of copper per year.

With copper prices at high levels and the cycle expected to continue, "it is the right time to produce a little bit of copper," Benavides said.

Buenaventura is also raising output at Uchucchacua, which produces silver. Benavides said the expanded facilities should be at full capacity by September or October, adding an additional 1 million ounces of silver to production.

Benavides reiterated the company's 2006 forecast for Yanacocha gold output of 2.6 million to 2.7 million ounces. First-half production was 1.55 million ounces but is expected to decline during the latter part of the year. Grade in the second half will be around 0.6 to 0.7 grams per ton, compared with 1.1 to 1.2 grams per ton in the first half, Benavides said, with a cash cost "in excess of $200." Buenaventura has a 43.65% in Minera Yanacocha, which is operated by Newmont Mining Corp (NEM).

Benavides noted that President-elect Alan Garcia, who defeated nationalist candidate Ollanta Humala in last month's elections, takes office Friday. The executive was optimistic on Garcia's economic policy and future relations with the mining industry.

"We expect his government to perform correctly," Benavides said. "All the messages he has given are all right for the business community."

The concern for miners during the elections was whether the next president would raise royalties for the companies. Benavides said Buenaventura expects no increase in those payments, calling such a hike "absurd" because of stability agreements that large producers have signed with the government. Benavides said there could be technical changes in the law but no direct increase in royalties.