Codelco signs early agreement with Salvador mine supervisors
The 36-month agreement will start on May 1, 2025.
Lima daily Gestion reports Chinese mining companies Minmetals, Chinalco, Shougang and Zijing Mining Group are planning to invest $7.4 billion in Peru over the next five years, making up a substantial part of overall mining investment projects expected through 2017.
Shougang already works an iron mine in Marcona and recently announced an investment of $1.2 billion over the next five years to expand operations.
Zijing Mining Group, which is advancing the Rio Blanco copper project in Piura, will spend $1.5 billion for the same period, while Minmetals will invest around $2.5 billion in the gold and copper project El Galeno, located in the Cajamarca region.
Aluminum Corporation of China (Chinalco) has also announced an investment of $2.2 billion in the Toromocho copper project in the region of Junin.
China’s positive stance is in contrast to other foreign investors – Peru’s mining, oil and energy society (SNMPE) said in early September that, as a result of almost a year of non-stop anti-mining protests in different regions of the country, mining investment in the South American nation is expected to fall 33% next year.
The delays to Newmont Mining’s (NYSE:NEM) controversial $4.8 billion copper-gold Conga project in the Cajamarca region is only one of the factors investors are taking into account when rethinking their portfolios. Mostly they worry over the large number of mining projects dealing with social conflicts, such as Swiss based-Xstrata’s Tintaya copper mine, near Cuzco, in Southeastern Peru.
Behind Chile, Peru is the world’s second biggest producer of copper and silver and a major producer of gold, zinc, lead and other minerals.
Comments
mehminer
Infrastructure construction in Peru is extremely difficult because proven Peruvian metallic resources are mostly (entirely?) in the Andes, usually at high elevations. Currently export of almost all resources is through Pacific ports or along the PanAmerican Highway, which follows the coast. RR mileage is entirely internal and also serves only the coastal ports. Building road or RR from the crest of the Andes cordillera to the coast involves laying metal down river valleys subject to flooding, often violent flooding – the kind that wipes out whole villages and can take many lives. On the that same slope of the cordillera, running infrastructure N-S is even worse, since the mountains are deeply incised from near the high passes to the coast region, requiring very frequent bridge building to get anywhere in that direction.
On the Eastern slopes, the situation is the reverse but just as bad. Here, major rivers that source the Amazon rise in the S and drain northward, with large flows resulting from heavy rains from the eastward rainforest as well as meltwater from glaciers to the west. The Inca highway (a developed footpath, really. The Inca never used wheeled transportation.) runs mostly N-S. Roads that descend into the interior lowlands must descend and re-ascend mile-deep and sometimes broad valleys. I’ve ridden buses that take most of a day to cross the largest of these.
This could be a great opportunity for Peru … or a quagmire (bad choice of words, I know) for the Chinese. Bears watching; this should be quite a story.