2007 meant great achievements and new challenges, and also profound pain for Codelco at having lost ten people that worked in our operations. Through this letter, I repeat the commitment to safety for each and every one of those who work for Codelco as life is the first priority.

Through a revision process at all levels of the company, the Executive Committee approved an Immediate Action Plan concerning safety that was also presented to the Board. This Plan puts the emphasis on reinforcing leadership in safety, the correction of substandard conditions wherever they occur, the reinforcement of safe conduct, and it includes a revision of the Safety, Occupational Health and Environmental Management Policy, whose new version was issued in December.

With regard to resources, 2007 produced very favorable results for the company and for Chile. Codelco continued being the biggest wealth-generating company for the country and achieved profits of US$ 8.451 billion in 2007. These resources, together with those generated in 2006, constitute the highest amounts in the history of the company. The profits provided by Codelco to the Treasury in the last two years exceed by 20% the total delivered in the 1990–2004 period.

The results of the company are equivalent to delivering practically one million dollars an hour, 24 hours a day, for the 365 days of 2007 to the State. These large sums were provided within the context of an auspicious market, which was reflected in the average annual copper price that reached US$ 323.2¢ per pound.

The company’s strategy to grow with competitiveness would not be possible without the alliance with its workers. During 2007, important agreements were signed for the Strategic Alliance phase III with the Federation of Copper Workers and the Federation of Copper Supervisors that emphasized the improvement of company administration consistent with the concerns of the workers and the needs of the company.

Several years ago Codelco defined sustainability as one of the key levers of its strategic development. In line with this commitment, during 2007 it invested US$ 53.7 million in environmental projects and US$ 65.5 million in labour safety initiatives. The company continued its improvement and investment programme for full compliance with Supreme Decree 90 that regulates the discharge of liquid waste in continental and marine waters, highlighting:

I The start-up of a molybdenum abatement plant for effluent from the Caren tailings dam with a total investment of US$ 31 million in the El Teniente Division.
I Completion of the construction of a siphon and tunnel for the treatment of acid water in the Andina Division with a total investment of US$ 35 million.

In addition, through the Clean Production Agreement signed with the Clean Production Council of Corfo, we continued to develop actions to optimize the use of energy resources, applying efficiency improvement plans and evaluating renewable energies. An example of this is a study about the possibility of building a wind farm to generate part of the electricity required for the Gabriela Mistral mine.

During 2007, following an external audit, Codelco Norte, Salvador and El Teniente Divisions, as well as the Head Office and Exploration were recommended to maintain their ISO 14001 and OHSAS 18001 certification. This maintenance process will be undertaken by Andina Division in 2008, while Ventanas Division, which maintained its ISO 14001 certification, is in the process of certification under OHSAS 18001. Also during this period, a company directive for Codelco Mine Closures was elaborated and diffused throughout the company, and all waste with biphenyl polychlorides - known as askarels - was withdrawn for final elimination in France.

WE ARE PROUD TO INFORM YOU THAT THIS IS OUR FIRST SUSTAINABILITY REPORT PRODUCED IN ACCORDANCE WITH THE LATEST VERSION (G3) OF THE GUIDE FOR THE DEVELOPMENT OF SUSTAINABILITY REPORTS OF THE GRI (GLOBAL REPORTING INITIATIVE) AND THE MINING AND METALS SUPPLEMENT, REACHING CATEGORY A+, THE HIGHEST LEVEL OF THIS STANDARD.

The contents of this report consist of a balanced and reasonable presentation of the advances, commitments and challenges that Codelco realized during 2007 with regard to sustainability. In addition, it has been verified by an external company, as have the versions published since 2002. Codelco, as a company for all Chileans and the leading copper producer in the world, is committed to be a leader in terms of transparency and information to its stakeholders, and this present Sustainability Report follows this commitment.

In 2007, once again, Codelco appeared in the MORI Social Responsibility Poll as one of the best evaluated companies in Chile in terms of social responsibility performance, at the level of large international companies (first place) as well as the local level (first place in a closed question).

Finally, during 2007, within the framework of the Codelco Good Neighbour programme, the various divisions and work centres developed more than 60 projects in areas associated to education, environment and economic enterprise. The initiatives undertaken together with indigenous Atacaman communities such as Aymara and Quechua, deserve a special mention. Also, the fourth contest to apply for resources provided by the Company Social Investment Fund was held.

The Company understands sustainability, one of the pillars of its business strategy, as the preservation of the environment and land, the care of its workers and the maintenance of good relations with the neighbouring communities of our installations. Codelco is the leading company in Chile and we are committed to assure this wealth for future generations. A company committed to sustainability must visualize the future of the business to assure that the copper industry continues generating profits for the long term so that future generations of Chileans can enjoy the benefits that copper provides today to Chile.

Those of us that work at Codelco have the obligation to administer the most valuable mining asset of the country in a responsible, efficient and sustainable way. I invite you to see, through this report, some of the actions that are being undertaken with this perspective.