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(Last updated: 30 May 2009)
Trends and opportunities
The market
Argentina has one of the largest and potentially richest metalliferous mineral areas in its Andean region and non-metalliferous mineral deposits elsewhere within its territory. Since the development of investor friendly mining laws in 1993, Argentine mining exports have grown from US$70 miillion in the early '70s to over US$4,000 million in 2008, according to government statistics.
Four major projects have been responsible for the majority of growth:
- Bajo de la Alumbrera (copper and gold) owned by Minera Alumbrera S.A. (Xstrata Pty Ltd- Northern Orion).
- Salar del Hombre Muerto – Fenix Project (lithium) owned by Minera del Altiplano SA (FMC Lithium Co.).
- Cerro Vanguardia (gold and silver) owned by Anglo Gold Ashanti.
- Veladero (gold-silver) owned by Barrick.
There are a number of new projects and junior mining companies operating in Argentina, in the last year a few new projects have been developed to include Minera Santa Cruz (gold/silver), owned by Hothchild Group from Peru, and Manantial Espejo (silver) owned by Pan American Silver (Canada) have commenced operation in the last few months.
Pascua-Lama – a bi-national Chilean-Argentine project owned by Barrick Mining Co. The company is planning to invest over US$2.3 billion to develop the project in the San Juan province crossing over the Chilean Andean region. The project has received the approval from both Chilean and Argentine governments, and will be the largest gold mine in South America. The company and is now awaiting final approval on the way taxes are distributed with the provincial government of San Juan and Chile.
Potasio Rio Colorado, a potassium project was recently purchased by Vale Group from Brazil to Rio Tinto, the resource is located in the south of Mendoza will require over US$700 million to develop this project.
Pachon, a major copper resource owned by Xstrata will be one of the largest mine developments in Argentina. Estimated investment is US$1.9 billion. Final pre-factibility has been completed. Annual production is estimated in 245,000 tonnes of copper with a mining life span of over 20 years.
Pirquitas, (silver/lead/tin) owned by Silver Standard from Canada has completed the mine construction and has started operating. This resource is located in Jujuy, northern Argentina.
Las Flechas a copper/gold project operated by Desarrollo de Prospectos Mineros (Suramina Resources) in Argentina and Minera Frontera Del Oro in Chile. This project has recently obtained the approval from both Argentina and Chile governments. The project is located in the Province of San Juan, the resource straddles over to Cordon Los Nietos on the III Region in Chile.
Agua Rica, the copper/gold resource is located just 40km away from Minera Alumbrera mine in the Province of Catamarca. The project is now part of the Yamana Group, which has recently merged with Meridian Gold and Northern Orion.
Gualcamayo, a gold mine owned by Yamana Resources was commissioned last month. Investment was US$150 million to develop this mine, located in Jachal, Province of San Juan.
Vicuña, a copper/gold project is owned by Suramina Resources and located between San Juan La Rioja and Chile.
There a number of other projects to include Navidad – one of the largest silver resources located in Southern Argentina, owned by Aquiline Resources and Casposo (gold) a small gold project in the Province of San Juan was recently purchased by Troy Resources from Australia from Intrepid Resources of Canada and expect to develop this resource very soon.
Australian and Canadian companies are exploring for uranium resources in Argentina.
Opportunities
The world financial crisis made an impact on the exploration activities in Argentina, but other mine expansions went ahead as planned. Although competition is active with an increasing presence of international players, Argentine mining companies are demanding mining services.
Basically most mining in Argentina is open pit with only two mines operating underground mining.
A number of geochemical analysis laboratories are already established in the region and provide adequate services to the exploration companies.
A number of geochemical analysis laboratories are already established in the region and provide adequate services to the exploration companies.
The absence of a well-developed local manufacturing industry dedicated to mining provides opportunities for Australian companies to offer and join forces with local companies to produce locally at very low costs and develop an export strategy to other South American markets. The following is a partial list of products and services required:
- Special steels – wearing parts for shovels, buckets, etc
- Drilling rods and parts
- Grinding media
- Liners for SAG mills
- Flotation re-actives
- Off–road tyres
- Maintenance service contracts
- Parts and components for copper mine operation and concentrators
- Services for the mining exploration industry
- Laboratory assay
- Mainly copper, gold, silver, lead, tin
- All areas including mining (blasting, hauling)
- Mineral processing - crushing, milling, concentration
- Mining software (resource estimation, modelling, mine design and planning)
- Some technology suppliers are partnering with local companies; this is encouraged by the local government to help develop local suppliers.
- Mining courses
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