Spotlight: Peru's major copper projects

Peru has a US$36.5bn copper portfolio, with 23 projects that could enable the country to take advantage of a copper boom being driven mostly by rising demand for electric vehicles and renewable energies. 

Output this year is expected to reach 2.55Mt before rising to 2.87Mt in 2023, according to Chilean copper commission Cochilco. 

Last year, Peru produced 2.3Mt, representing 10.9% of global output. It is now the world’s second largest copper producer after Chile.

Global demand was 24.7Mt last year, will be 25.2Mt this year and 25.7Mt in 2023, according to Cochilco. Meanwhile, CRU Group expects global demand to reach 28.4Mt/y by 2030. 

Construction works are ongoing at Anglo American's Quellaveco and Chinalco's Toromocho expansion. The former will produce 300,000t/y and the latter will add output of 75,000t/y.

FEASIBILITY

Four projects in the portfolio are in the feasibility stage: Minera Las Bambas' Chalcobamba phase I, Nexa Resources' Magisterial, Teck's Zafranal, and Buenaventura's Río Seco copper plant.

Las Bambas received permits for the US$130mn Chalcobamba project in March, but local residents have occupied the asset, vowing to obstruct production.

For the US$490mn Magistral project, “Nexa expects to advance in 2022 with more detailed engineering and optimization opportunities to mitigate project execution risk, and receive approval of the EIA modification that was presented in 4Q21,” Roberta Varella, head of investors relations, told BNamericas in March.

Approval of the environmental impact study for the US$1.26bn Zafranal project is pending, but construction is expected to start in 2023. Nexa organized the first public audience of the year to inform the communities of the project in March.

Buenaventura’s vice president of business development, Aldo Massa, told BNamericas in February that the investments for the Río Seco plant will not be made this year, but a decision will come in 2023. The environmental impact study is already approved, however, and tests on gold and silver recovery from process residues are being carried out.

BIGGEST INVESTMENTS

La Granja

Rio Tinto’s US$5bn La Granja project is expected to have a useful life of 40 years and produce 500,000t/y.

According to the energy and mines ministry (Minem), Rio Tinto continues exploration in the area as part of the pre-feasibility stage.

Exploration was extended into 2022 after the supporting technical report was approved.

Galeno 

Lumina Copper CEO Manuel Chung told BNamericas earlier this year that “currently our shareholders are taking their time to assess the evolution of the political and social situation in the country in order to draw up a plan for the development of the definitive feasibility study. I estimate that at least through 2022 there will be no progress.”

The US$3.5bn Galeno project has an estimated mine life of 20.4 years, with annual production of 144,353t. It will also produce gold, silver and molybdenum.

Los Chancas

The US$2.6bn Los Chancas project, owned by Grupo México’s Southern Peru Copper (SPC), is expected to start operations in 2027. Potential for 545Mt of mineralized material with copper content of 0.59% has been identified at the site.

An open pit mine, with a combined concentrator operation and leaching processes, the project is planned to produce 130,000t of copper and 7,500t of molybdenum per year.

Michiquillay

Also owned by SPC, the US$2.5bn Michiquillay project will have a mine life of 25 years and produce 225,000t/y.

In October 2021, the authorities approved the semi-detailed environmental impact study. Operations are projected to start in 2028. The mine will be among the country’s biggest, also producing molybdenum, gold and silver.

Tía María

The US$1.4bn Tía María project is the most advanced development in SPC’s portfolio. The detailed engineering has been finished and a construction permit was granted in 2019, but canceled amid social protests.

In February this year, SPC reported improved ties with the regional government and a solution to the conflict. The agreement involved new health facilities and infrastructure under the works-for-taxes model.

In March, CFO Raúl Jacob told BNamericas that the project will need government and local support to start operations.

Río Blanco

Located on the border with Ecuador, the US$2.5bn Río Blanco project still faces public opposition, so Río Blanco Copper is developing communication and information plans.

Ecuador’s deputy minister of mining, Reinaldo Reyes, told BNamericas recently that the country would welcome the project.

Estimated production is 200,000t/y.

PREFEASIBILITY

Several projects have entered the pre-feasibility stage. The major ones are the US$1.49bn Cotabambas, the US$1.56bn Cañariaco, the US$1.86bn Haquira, and the US$1.29bn Quechua projects.

Project	Stage	Investment  (US$ million)	Operator
Quellaveco	Construction	5,300	Anglo-American
Toromocho Expansion	Construction	1,355	Mining Chinalco
Chalcobamba Phase I	Feasibility	130	Las Bambas Mining
Río Seco copper plant	Feasibility	410	Buenaventura
Magisterial	Feasibility	490	Nexa Resources
Zafranal	Feasibility	1,263	Mining Zafranal
Trapiche	Pre-feasibility	973	El Molle Verde
The Chancas	Pre-feasibility	2,600	Southern Peru Copper Corporation
Michiquillay	Pre-feasibility	2,500	Southern Peru Copper Corporation
Ariana	Construction (halted)	140	Ariana Mining Operations
Tía María	Detailed engineering	1,400	Southern Peru Copper Corporation
Antilla	Pre-feasibility	250	Panoro Apurimac
Cañariaco	Pre-feasibility	1,560	Cañariaco Copper
Cotabambas	Pre-feasibility	1,486	Panoro Apurimac
Don Javier	Pre-feasibility	600	Junefield Group
Galeno	Pre-feasibility	3,500	Lumina Copper
Haquira	Pre-feasibility	1,860	Minera Antares
Coroccohuayco Integration	Pre-feasibility	590	Antapaccay
La Granja	Pre-feasibility	5,000	Rio Tinto
Los Calatos	Pre-feasibility	655	Minera Hampton
Pukaqaqa	Pre-feasibility	654.9	Nexa Resources
Quechua	Pre-feasibility	1,290	Quechua Mining
Río Blanco	Pre-feasibility	2,500	Río Blanco Copper