Argentina’s mining industry is following
closely what opposition candidate Alberto Fernández, the front-runner for
October’s presidential election, has to say when it comes to resources
exploitation and foreign investment, as worries about the potential Peronist government
turning to protectionist measures and populist policies mount.
Fernández, who pulled off a
resounding victory in the primary elections held in August with more than 47%
of the votes, is thought by many to be synonym of markets and capitals control.
President Mauricio Macri, in contrast, is seen as setting a safer investment climate for miners. His first move was to scrap a 5% mining tax, and followed with unifying mining regulations of 20 of the country’s 23 provinces under a federal agreement.
Alberto Fernández, the front-runner for October’s presidential election, is thought to be synonym of markets and capitals control.
The nation’s right-wind leader has
also advanced been efforts to reduce costs and red tape for prospectors.
Fernández is trying to dispel any concerns on the matter. He recently met with representatives from 24 mining companies with projects in the country and told them he considered mining an opportunity, rather than a problem.
The leftist candidate has also vowed
not to be an obstacle to the industry, which includes lithium, copper, gold and
silver.
Argentina hasn’t seen a
significant new mining project since 1997, when work started on Glencore’s
Alumbrera gold and copper mine.
But in March, Yamana Gold, Goldcorp
and Glencore revealed they were studying a plan to jointly develop the Agua
Rica gold and copper project in the country’s northwest.
Canada’s First Quantum Minerals is
also mulling a $3 billion investment in Taca Taca, another gold and copper
project in Salta province.
Barrick, in turn, is considering shifting
ownership of the Lama property at the Pascua-Lama project in Chile to nearby
Veladero in Argentina. The planned mine at Pascua Lama has been delayed by
legal and environmental disputes over Barrick’s initial plans to operate an
open-pit mine at the site.
The lithium card
Fernández economic agenda includes
a 10-year growth plan for the mining industry, led by the lithium sector.
Argentina has three lithium
projects consolidated and in production — NRG Metals’ Hombre Muerto and Lithium Americas’
Cauchari-Olaroz in Catamarca province, and Orocobre’s Olaroz in
Jujuy. A further 23 exploration projects are advancing to production.
According to a report by the Inter-American Development Bank (IDB), the country has 13% of the global lithium reserves, while annual production currently stands at 30,400 tonnes.
The South American nation is the world’s
third biggest lithium producer, hoisting 25% of the resources in the so-called
lithium triangle (Chile, Bolivia and Argentina).
Argentina needs foreign investment
and jobs that properly run and managed mining projects could bring in.
The country’s economy is tanking with
the central bank recently hiking interest rates to ease inflation and save the Argentinean
peso, the worst-performing currency in emerging markets.
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