FILE PHOTO: The logo of Codelco, the world's largest copper producer, is seen at their headquarters in downtown Santiago, Chile March 29, 2018. REUTERS/Ivan Alvarado/File Photo

By Fabian Cambero and Daina Beth Solomon

SANTIAGO (Reuters) -Chile's Codelco, the world's largest copper producer, on Friday lowered its 2025 production guidance following a tunnel collapse at its flagship El Teniente mine and said it will revise plans for sectors that were part of an expansion.

The state-run miner now expects 2025 production of 1.34-1.37 million metric tons of copper, down from a March estimate of 1.37-1.40 million tons - a trim of 30,000 tons on both ends.

Codelco's output hit a quarter-century low in 2023, and the company has been struggling to compensate for aging deposits and delays in major expansion projects.

The accident on July 31 at El Teniente, Codelco's most profitable mine, marked a new blow, forcing mining activity and smelting to go offline for several days and causing a loss of 33,000 metric tons of copper, equivalent to $340 million.

Six people died in the sudden collapse of underground tunnels that packed an impact equivalent to a 4.2 magnitude earthquake.

Codelco on Friday flagged the possibility of further delays at the mine, saying sectors that were part of an expansion plan "need to be revised" after the accident, which hit the Andesita unit.

Andes Norte, started initial production in May, and Diamante had yet to begin production.

CEO Ruben Alvarado said the company had improved management and production this year up until the accident, and would prioritize safety along with the need for recovering operations.

"We are focused on our plan for a safe and gradual return to operations at El Teniente," Alvarado said in a statement. Half of El Teniente's 12 divisions have been re-opened so far.

The accident also prompted the company to postpone its announcement of financial results for the first half of the year, originally scheduled for Aug. 1.

Between January and June, Codelco recorded pre-tax profit of $429 million, down 34% from the $653 million reported in the same period last year.

The state-owned miner said its own output totaled 634,000 metric tons, up 9% from the same period last year, helped by higher production at Ministro Hales and El Teniente, and the Salvador mine's Rajo Inca project, which is in ramp-up.

Accounting for production from Codelco's stakes in El Abra, Anglo American Sur and Quebrada Blanca mines, total production reached 689,000 tons, 9.6% higher than in the same period of 2024.

By the end of June, Codelco had spent $2.512 billion of its annual budget of $5.638 billion, it said. Direct production costs in the period increased 6% to $2.157 per pound, and Codelco forecast that this year they will range between $2.09 and $2.14 per pound of copper.

(Reporting by Fabian Cambero and Daina Beth Solomon; Editing by Sarah Morland and Alistair Bell)