In March 2018, Martín Vizcarra, then Peru’s vice-president, ambassador to Canada, and former governor of the Moquegua region, delivered a speech at the PDAC Convention, outlining the successful public-private collaboration behind the Quellaveco copper project by Anglo American. Vizcarra’s address hinted at his future presidency, as the country faced political turmoil due to the Odebrecht corruption scandal. Following Pedro Pablo Kuczynski’s resignation, Vizcarra assumed the presidency on March 23, 2018, seeking to overcome opposition hurdles through a referendum on parliamentary re-election.

Despite ongoing political noise, Peru’s mining industry experienced continued economic activity in 2018, driven by improved commodity prices and the cyclical upturn typical in mining. The year brought positive developments, including expansion projects at the Toromocho copper mine, the construction of Mina Justa, and the green light for the Quellaveco copper operation. Mining investments in 2018 reached nearly US$4.95 billion, a 26% increase from the previous year.

Luis Rivera, president of the Peruvian Institute of Mining Engineers, acknowledged Peru’s significant geological potential but emphasized the need for political stability. He highlighted the impact of political noise on translating the country’s potential into real investment. Despite this, Peru has made remarkable strides in copper production, doubling its output in a decade and ranking as the world’s second-largest producer after Chile. With the global demand for copper rising due to electrification, Peru has an opportunity to further promote its mining industry.

Peru is the sixth-largest gold producer globally and holds significant gold reserves. Recent mergers and acquisitions in the gold sector, such as Barrick-Randgold and Newmont-Goldcorp, reflect the industry’s challenges in finding large deposits and navigating stricter regulations. The rising gold prices also contribute to this dynamic. However, caution is advised in acquisitions, considering the liabilities associated with purchased assets. Buenaventura, one of Peru’s largest mining companies, focuses on its extensive project portfolio within the country.

To bolster copper production and close the gap with Chile, Peru aims to attract multi-billion dollar investments. The country possesses a portfolio of 48 projects worth US$60 billion, with a focus on copper. Developing mining clusters is a strategic objective, allowing providers to establish service shops near mining operations and enabling infrastructure sharing. The Arequipa region has already witnessed progress in this regard, with natural mining clusters emerging. Integration efforts are also essential in the Las Bambas copper district and other potential copper-rich areas.

The state plays a crucial role in coordinating different projects, developing infrastructure, and fostering collaboration between industry stakeholders. The remote locations of many mineral deposits necessitate comprehensive planning and sustainable development initiatives. Industry leaders stress the need for coordination between infrastructure development and mining projects to unlock Peru’s mining potential effectively.

Peru’s mining industry requires a long-term vision beyond individual government mandates. The Center of Convergence for Good Mining and Energy Practices, established in 2018 by the Vizcarra government, aims to define a strategy for the country’s project portfolio until 2030. The strategy encompasses investment promotion, institution articulation, and addressing economic inequality and infrastructure gaps. Industry leaders urge President Vizcarra to take a leadership role, leveraging his regional government relationships to garner support for mining investments.

Peru’s mining industry continues to show promise despite political challenges. Economic activity in the sector, driven by improved commodity prices, has led to significant investments in copper projects. However, the country must address political noise and foster a business-friendly environment to unlock its full mining potential. Coordinated development, the creation of mining clusters, and a long-term vision are crucial for sustainable growth and maximizing Peru’s geological advantages. With the right strategies and collaboration, Peru can solidify its position as a prominent player in the global mining market.