R/€ = 15.56 Change: -0.02
R/$ = 13.91 Change: -0.05
Au 1417.60 $/oz Change: -10.10
Pt 847.95 $/oz Change: -2.53
 
 
R/€ = 15.56 Change: -0.02
R/$ = 13.91 Change: -0.05
Au 1417.60 $/oz Change: -10.10
Pt 847.95 $/oz Change: -2.53
 
 
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Giant copper project unblocked as Peru awards Tia Maria licence

10th July 2019 BY: Bloomberg

SANTIAGO – Latin America’s second-largest copper producer got the green light to build a giant mine that’s key to plans to become one of the world’s top three producers of the metal.

The Peruvian government awarded Southern Copper the license to start building its $1.4-billion Tia Maria project, which has been delayed since at least 2010 amid sometimes deadly protests, the company said in a statement on Tuesday. Southern Copper said it won’t start building the mine until concerns from local communities are resolved.

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Tia Maria is a big part of the Grupo Mexico SAB-owned company’s plans to get ahead of competitors Glencore and BHP. Southern Copper plans to invest more than $10-billion to boost production to 1.81-million tons by 2026 from 987 000 t projected this year, CFO Raul Jacob said in May. The largest producer, Santiago-based Codelco, forecasts its annual production at an average of 1.68-million tons over the next decade.

Southern Copper’s operations at Tia Maria will not affect other economic activities in the Tambo valley because it will use desalinated water, according to the statement. The company will build an industrial railway to carry mine supplies and copper ore, as well as a road access to the mine at a “prudent distance” from the Tambo valley, it said.

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The Lima-based miner gave no indication of when it could start work on the project. CEO Oscar Gonzalez Rocha said last week the company could start construction of the mine camp and administrative offices if it received the permit, but that it wouldn’t build the mine or the processing plants until getting the community’s acceptance.

PROTESTS PLANNED

Farmers from the Tambo valley plan to hold protests on July 24 to 25 and farmers in other parts of southern Peru plan demonstrations of their own, Arequipa-based newspaper El Buho reported on its website Monday.

Tia Maria is expected to produce 120 000 t of copper annually. The market is currently expected to post a 189 000-t deficit by the end of this year, according to the International Copper Study Group.

The project is the first in Southern Copper’s ambitious investment pipeline. Among the projects pending board approval are $2.8-billion for the El Arco project in Mexico, and more than $5-billion to develop the Los Chancas and Michiquillay deposits in Peru, as well as a new refinery in the Peruvian port town of Ilo.

The government’s decision is an “important signal’’ for reactivating private investment and will bring the social and economic growth the country needs, mine-industry group SNMPE said in an emailed statement.

Energy and Mines Ministry officials didn’t immediately respond to emails and messages requesting comment. 

EDITED BY: Bloomberg
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