(Reuters) – Chilean state-owned mining company Codelco is optimistic about copper prices for 2022 boosted by higher demand, its president Maximo Pacheco said on Friday during a press conference.

Pacheco, who spoke after a meeting with shareholders and Finance Minister Mario Marcel and Mining Minister Marcela Hernando, said the optimism stems from a global trend towards renewable energy transformation, in which copper is an essential metal.

“We know that electrification and energy transition is a tendency that’s going to be maintained as a result of the reality of climate change and global warming,” Pacheco said.

However, Pacheco and the ministers added that there are challenges for the company such as reducing its production costs, while promoting a project portfolio of $40 billion in “structural projects”.

“Both factors are going to help increase Codelco’s contribution to structural income from mining,” Marcel said, noting that higher copper prices would also help.

Hernando, the country’s mining minister, said she was happy with economic results, but took aim at some private companies.

“We are happy with the economic results but we are also aware that there are many challenges and that most of them have to do with improving the cost structure,” Hernando said. “We are having a bad behavior regarding other companies in the industry.”

Pacheco also said the government is trying to find a way in which Codelco, which gives its profits to the state, can count on resources from its profits to meet investment needs. Until now, the company is mostly financed with depreciation and debt.

“We need to review this criterion to see how the shareholder, in this case the Chilean state, can reinvest part of the profits in the same company to sustain the projects,” Pacheco said.

(Reporting by Fabian Cambero, Writing by Carolina Pulice; editing by David Evans)