2015 Minerals Yearbook PERU [ADVANCE RELEASE] U.S. Department of the Interior August 2019 U.S. Geological Survey The Mineral Industry of Peru By Yadira Soto-Viruet In 2015, Peru ranked third among the world’s leading to 195,705 from 174,310 in 2014. Of these 195,705 workers, producers of copper (accounted for 9% of world production), about 18% worked in Arequipa Region; 10% worked in Junin silver (15% of world production), and zinc (11% of world Region; 9% each worked in Apurimac Region and La Libertad production); fourth among the world’s leading producers of Region, respectively; and 7% each worked in Cajamarca Region molybdenum (9% of world production) and lead (6% of world and Lima Region, respectively (Ministerio de Energía y Minas, production); fifth among the world’s leading producers of gold 2016a, p. 117–120). (5% of world production); and sixth among the world’s leading As of December, the country’s foreign direct investment producers of tin (7% of world production). According to the (FDI) inflows amounted to about $7.7 billion compared with Ministerio de Energía y Minas (MEM), in 2015, Peru was Latin $7.6 billion in 2014. The balance of FDI in Peru as contributions America’s leading producer of gold, lead, tin, selenium, and to capital amounted to $24.2 billion in 2015, which was about zinc; and the second-ranked producer of cadmium, copper, the same amount as in 2014, and the mining and petroleum molybdenum, phosphate rock, and silver. The country’s world sectors received about 23% and 3% of that amount, respectively. rankings for reserves of mineral commodities were as follows: The main sources of FDI to Peru as contributions to capital first for silver, second for molybdenum, third for copper and included Spain (19%), the United Kingdom (18%), the zinc, fourth for lead, and sixth for gold. In 2015, Peru’s real United States (13%), Chile (9%), the Netherlands (6%), and gross domestic product (GDP) increased by 3.3% to about Brazil and Colombia (5% each) (ProInversión, 2016a–c). $150.5 billion1 compared with $166.9 billion (revised) in 2014. Investment in the mining sector decreased by about 15% The country’s manufacturing sector accounted for 14% of the to $7.5 billion from $8.9 billion in 2014. Infrastructure total GDP and the mining sector accounted for 12% of the investments accounted for about 16% of the total mining total GDP (Banco Central de Reserva del Perú, 2015, p. 32; investments, followed by mining (11%), mining equipment 2016a; 2016b, p. 45–46; Ministerio de Energía y Minas, 2016a, (9%), and beneficiation plant equipment and exploration p. 27, 31; Anderson 2017; Bennett, 2017; Brininstool, 2017; (6% each). In 2015, investments in mining equipment increased George, 2017; Guberman, 2017; Polyak, 2017; Tolcin, 2017). by 17% to about $654 million from $557 million in 2014, and investments in beneficiation plant equipment decreased by Minerals in the National Economy 50% to $446 billion from $890 billion in 2014; exploration decreased by 28% to 442 million from $617 million in 2014; In 2015, the value of the contribution of the mining and infrastructure, by 16% to $1.23 billion from $1.46 billion; and hydrocarbon sectors to the GDP increased by 9.3%. The mining, by 13% to $793 million from $912 million (Ministerio increase in the country’s GDP was attributed to an increase in de Energía y Minas, 2015b, p. 15; 2016a, p. 99). the mining of metals owing to the expansion of the Cerro Verde As of December, estimated investment in the country’s mining Mine operated by Sociedad Minera Cerro Verde S.A.A. (Minera portfolio included 47 major projects, which would amount to Cerro Verde), which was a joint venture of Freeport-McMoRan about $57 billion during the next 4 years. Of the $57 billion, of the United States (53.6%), Sumitomo Metal Mining Co. Ltd. about $24 billion (42%) was for projects with approved of Japan (21.0%), and Compañía de Minas Buenaventura S.A.A. environmental impact assessments or under construction, about (Buenaventura, 19.6%); and the startup of the Las Bambas Mine $23 billion (41%) was for projects in the exploration phase, operated by Minera Las Bambas S.A., which was a joint venture about $9 billion (16%) was for expansion projects, and about of Chinese companies MMG Ltd. (62.5% interest), GUOXIN $884 million (2%) was for projects in the evaluation process. International Investment Corp. Ltd. (22.5%), and CITIC Metal Most of the investment was from, in order of investment value, Co., Ltd. (15.0%). The value of the mining of metals increased China ($19 billion, or 34%), Canada ($9 billion, or 16%), the by 16% in 2015, which was attributed to a 26% increase in the United States ($5 billion, or 9%), Mexico and Peru ($4 billion, or production of copper. The value of hydrocarbons decreased by 7% each), Australia ($3 billion, or 5%), Brazil ($2 billion, or 4%), 12% in 2015, which was attributed to decreased production of and Japan ($500 million, or 0.9%). Copper projects accounted petroleum (owing mainly to lower international oil prices) and for about 62% of the total investment in mining followed by natural gas and natural gas liquids (table 1; Banco Central de copper-gold and polymetallics (10% each) and iron ore (9%) Reserva del Perú, 2016a; 2016b, p. 45–46). (Ministerio de Energía y Minas, 2015b, p. 15; 2016a, p. 109). Peru’s mining activity was broadly distributed among 23 of In 2015, Minera Cerro Verde was ranked first among the its 25 Regions. As of December, about 604 mining operations mining companies investing in the country; the company were in the production stage, 408 were in the exploration stage, invested $1.6 billion in the expansion of the Cerro Verde Mine and 93 were in the construction stage throughout the country. In in Apurimac Region, followed by Minera Las Bambas, which 2015, direct employment in the mining sector increased by 12% invested $1.5 billion for the development of the Las Bambas 1Where necessary, values have been converted from Peruvian nuevo project in Cotabambas, Apurimac Region. Glencore plc ranked sol (PEN) to U.S. dollars (US$) at annual average exchange rates of third among the mining companies investing in the country. PEN0.35717=US$1.00 for 2014 and PEN0.31190=US$1.00 for 2015. PERU—2015 [ADVANCE RELEASE] 16.1 The company invested $570 million in the expansion of the 14% to 315,784 t from 277,153 t (revised). Increases in the Antapaccay project in Cusco Region. Arequipa Region received production of industrial minerals were led by boron (176%), 24% of Peru’s mining investments, followed by the Apurimac kaolin (117%), quartz and quartzite (79%), sand (54%), (20%), Cusco (12%), Junin (8%), La Libertad (7%), and Ancash travertine (44%), marble (27%), salt (25%), and limestone (6%) Regions (Ministerio de Energía y Minas, 2015b, p. 14; (12%). Increases in the production of mineral fuels and related 2016a, p. 102, 105). materials were led by anthracite (46%), residual fuel oils (22%), and lubricants (15%). Tin metal production decreased by 17% Government Policies and Programs to 20,396 t in 2015 from 24,462 t in 2014; tin content of mine output, by 16% to 19,511 from 23,105; direct reduced iron, The Ministerio de Energía y Minas (MEM) is the by 14% to 76,000 t from 88,000 t; and electrowon copper, by Government agency responsible for the administration and 13% to 73,091 t from 83,800 t. Decreases in the production regulation of the energy and mining sectors. The Instituto of industrial minerals were led by barite (73%), onyx (57%), Geológico Minero y Metaluúrgico of the MEM is the authority bentonite (43%), diatomite (20%), gypsum (19%), and slate responsible for all legal matters related to geoscience research (16%) and decreases in the production of mineral fuels and and for the management of land and mining concessions. related materials were led by bituminous coal and jet fuel The Dirección General de Minería (DGM) of the MEM (17% each), crude petroleum (16%), distillate fuel oil (15%), has the responsibility to address all legal matters related to asphalt (13%), and natural gas liquids (12%). Data on mineral mining sector policy. The Dirección General de Asuntos production are in table 1. Ambientales of the MEM has the responsibility to address environmental problems that result from energy and mining Structure of the Mineral Industry activities and is mandated to implement environmental laws and regulations. Perúpetro S.A. is a nonregulatory agency In 2015, Peru’s leading copper companies included responsible for the promotion of hydrocarbon investments in Compañia Minera Antamina S.A. (Antamina), which was a the country (law No. 26221, Ley Orgánica de Hidrocarburos). joint venture among BHP Billiton plc of the United Kingdom Perúpetro negotiates, signs, and administers hydrocarbon (33.75% interest), Glencore (33.75%), Teck Cominco Ltd. contracts for which Perúpetro must compete with the private of Canada (22.5%), and Mitsubishi Corp. of Japan (10%); sector. Perúpetro was involved in the transportation, refining, and Compañia Minera Antapaccay S.A. (Antapaccay), which was marketing of refined products and other derivatives of petroleum owned by Glencore plc of Switzerland (100%); Minera Cerro as well (Instituto Geológico Minero y Metalúrgico, 2016; Verde; Minera Chinalco Peru S.A., which was a subsidiary of Ministerio de Energía y Minas, 2016b–d; Perúpetro S.A., 2016c). Aluminum Corporation of China (Chinalco); and Southern In 2014, the Government issued four rules to formalize small- Copper Corp., which was owned by Grupo Mexico S.A.B.