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The quake struck at 0634 GMT about 91km (56 miles) north-east of the city of Concepcion and 317km south-west of the capital, Santiago.
Chilean television is reporting 16 deaths so far. President Michelle Bachelet also said a large wave had affected one southern island group.
The US issued an initial tsunami warning for Chile, Peru and Ecuador.
That was later extended to Colombia, Antarctica and Central America. Japan's meteorological agency warned of a potential tsunami across large areas of the Pacific.
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