Southern Copper eyes early start at Michiquillay copper mine in Peru

By Sarah Mughal, SNL

June 12,2018

Southern Copper Corp. now expects to start operations at its Michiquillay copper in mine in Peru in 2022, three years earlier than the previous forecast of 2025, Reuters reported June 12, citing CEO Oscar Gonzalez. The Grupo México SAB de CV unit plans to kick off the US$2.5 billion Michiquillay construction in 2019. However, the company will have to reach agreements with communities near the deposit to secure construction permit from the government. Gonzalez estimated that talks with these communities would take a year, with construction to take another three years. Securing approvals from residents pose a challenge, as the company's US$1.4 billion Tia Maria copper project in the country has already been on hold for years due to local opposition. Alberto Necco, head of state investment promotion agency, Proinversion, said that communities near Michiquillay were not opposed to mining, but expect jobs, training and other benefits from the miner, some of which were outlined in the contract that Southern Copper signed with the government. Southern Copper won a tender to develop the Michiquillay mine in February from the Peruvian government. The proposed mine is expected to produce 225,000 tonnes of copper per annum for an initial mine life of over 25 years, the report added. The company recently flagged investments of more than US$10 billion in Peru and Mexico to boost its copper output to 1.7 million tonnes by 2025 from the current 900,000 tonnes to capitalize on rising prices and demand.