Mining in Peru
The Mining Industry in Peru is going through a great moment; in spite of the low commodity prices during the last 2 years, there still is an interest from Foreign Investment coming to the country. International mining and metals companies perceive the country as a global player. This is mostly due to the scale of opportunities given throughout all the territory as a result of its attractive legislation and regulatory environment. It is estimated by Peru’s Ministry of Energy and Mines to have Mining and metals investment over the period 2015-2020 of almost 70 billion (US). About 63% will be invested in copper projects, with gold and iron ore set for much of the rest. It is estimated that only 0.34% of the country’s total territory was being explored in 2014.
There is a big leap between the Projects, those in Exploration and the ones in Construction and/or Pre-Commissioning, Commissioning and Production, which show what will happen in the mid-term with mining projects coming to production, for which feasibility studies have been carried out such as Pukaqaqa, Pampa De Pongo, Santa Ana and Tambomayo.
Peru is the 3rd biggest producer of copper and zinc worldwide, and it is estimated that in 2016 will become the second largest producer of copper with the incursion to production of projects such as Constancia from Hudbay Minerals (+2 billion USD CAPEX) and Las Bambas from MMG (+6 billion USD CAPEX) recently acquired by them and sold by Glencore, among others. The Mining mega-projects are interesting in the short-term because they are getting into production and/or they are doing an expansion. Based on the CAPEX of the Project, the other projects to watch seem to be the one from Southern Peru Copper – Grupo Mexico- called Tía María, which is currently facing some challenges with the community, nevertheless it will move forward and another, Cerroverde, which belongs in the majority to FreePort McMoRan with Compañía Minera Buenaventura holding a large portion of shares as well.
There are other mega mining projects (all with a CAPEX in excess of 1 billion USD) such as Quellaveco from AngloAmerican, Toromocho from Chinalco, La Granja from Rio Tinto, Minas Conga from Newmont, Pampa de Pongo from Jinzhao Mining Peru, among others.
As a conclusion, we can remark the Mining Industry will continue being one of the strongest Industries in Peru and continue contributing to the growth of the GDP the country is recently experiencing.