In 2019, the junior mining community in Peru encountered numerous difficulties, mirroring trends seen in other countries except Australia. Global exploration budgets declined in five out of six major mining countries, with Peru receiving 6.3% of global investment in non-ferrous metal exploration in 2018. However, despite an overall increase in investment in Peru’s mining industry, exploration expenditures witnessed a decline of 13.5% in 2019. The diminishing interest from junior participants in the Canada Peru Chamber of Commerce (CCCP) reflects the pressing need to address the challenges facing the exploration sector. This article explores the various obstacles faced by junior mining companies in Peru and highlights initiatives aimed at revitalizing exploration and attracting investment.

The prolonged permitting and authorization processes have become a significant concern for junior mining companies in Peru. According to Carla Martínez, General Manager of CCCP, reducing permitting and authorization times is crucial to reignite the interest of the junior mining community. Furthermore, ongoing social challenges and the time-consuming approval of drill permits have strained the relationship between junior companies and the jurisdiction. To address these issues, Peru must proactively combat corruption and streamline the permitting processes to attract more investment into the exploration sector.

Recognizing the challenges faced by junior companies, the Peruvian government has identified stimulating exploration as a key objective in 2020. The government aims to expedite permitting processes and promote investment by implementing measures such as granting a definitive VAT rebate for the next three years. Additionally, the government is considering reviewing legislation to introduce further adjustments and facilitate faster permitting processes. These initiatives demonstrate the government’s commitment to fostering a favorable environment for exploration and attracting investment.

The influence of Canadian money markets plays a significant role in supporting junior mining companies. The establishment of a full-time presence by the Toronto Stock Exchange (TSX) and TSX Venture Exchange (TSXV) in Lima highlights the growing interest in South American mining opportunities. Latin America represents 23% of mining issuers on TSXV, making it the second-largest after Canada. Guillaume Legare, Head of South America for TSX and TSXV, emphasizes the importance of alternative channels for accessing capital, such as the Capital Pool Company (CPC) program. These initiatives aim to connect experienced investors with growth-stage companies, providing opportunities for junior mining companies to raise capital and explore mining prospects in the region.

The surge in gold prices and the cautious approach of generalist investors have led to a discrepancy between precious metals producers and junior mining companies. However, major gold producers, recognizing the need to diversify their portfolios, have shown interest in investing in base metal juniors. Gold Fields and Buenaventura have made strategic investments in base metals juniors in Peru, focusing on copper assets. Industry experts, including Barrick CEO Mark Bristow, predict that copper will become a strategically vital metal in the coming decade, supporting the investment in copper-focused projects in Peru.

Copper, being a scarce resource for junior companies globally, presents opportunities for significant growth. Companies like Regulus Resources and Chakana Copper have demonstrated promising exploration success. Regulus’ AntaKori project, with its impressive copper intercepts and close proximity to operating mines, is often cited as a potential buyout candidate. Chakana Copper’s Soledad project, with its extensive drill program, aims to uncover valuable copper assets. These success stories highlight the potential for growth and investment in Peru’s copper exploration sector.