More than a dozen global mining
companies with operations in Chile signed this week a deal that would see them renting
part of their properties to small-scale miners, which sell their output to state
mining development corporation ENAMI.
Top players including BHP, Barrick
Gold, Anglo American, Antofagasta Minerals, Lumina Copper, Freeport-McMoRan, Teck Resources,
Lundin Mining, KGHM and SQM, will deal directly with ENAMI.
The body, in turn, will sublet the
properties to artisanal miners, which will carry out extraction and exploration
through more than 840,000h in Chile’s arid and copper-rich Atacama
region.
Those properties, local paper La Tercera reports, account for less than 1% of revenue global miners that signed the deal earn from production.
BHP, Barrick Gold, Anglo American, Antofagasta, Freeport-McMoRan, Teck Resources and SQM among the companies that will rent part of their Chilean assets to small miners.
In early August, copper prices fell
to $2.53 a pound on the Comex division of the New York Mercantile Exchange,
the lowest level since 2017.
Although 93% of Chile’s copper
output comes from large mines, a sharper drop in prices for the red metal could
send small and medium-sized mines over the edge. Those operations generally
employ up to 80 workers, but are often much smaller, while medium-sized ones
have a maximum of 400.
Another issue affecting the sector
in Chile is that the bulk of exploration is in the hands of major miners, as is
quite cheap for them to hold a property — only $2 per hectare for exploration
projects and $5 p/h for those already in exploitation.
“Companies have no incentives to do anything with those assets, most of them brownfield projects, and that needs to change to both boost exploration in the country and let juniors in,” Diego Hernández, president of the Chilean mining society, Sonami, and a former Codelco CEO, told MINING.COM last year.
In other places, such as in South Australia, companies have to demonstrate they are working on their properties or else risk losing them. Charles Moore, from the State’s government, warns that unfortunately there are always ways to trick the system.
“Some companies do the very minimum just to keep ownership of their assets,” Moore, who is leading the development and implementation of South Australia’s copper strategy, noted.
Data from the Chilean copper
commission (Cochilco) shows that some similar may be happening in the South
American nation. Of the 110 mining companies with interests in the country, 74
are junior miners with exploration projects, from which only 33 have reported some
activity in the last year.