Mining Diversification, Decarbonization and Infrastructure

From your perspective on the sector and public policy, how do you assess the potential to diversify Peru’s mining portfolio, and what regulatory and institutional conditions are needed for the country to develop new deposits competitively?

Peru has a long tradition of producing minerals such as zinc, lead, tin, copper, gold and silver. On this basis, it has developed human and technical capabilities linked to mineral discovery, exploration and mining. However, its geological potential, particularly that associated with the Andes, could be revisited through new prospecting and exploration campaigns focused on minerals required by the energy transition, such as lithium, nickel, cobalt, rare earths and uranium.

Taking advantage of this potential will require stronger incentives for exploration investment and the promotion of new technologies capable of identifying resources even in areas that have already been explored. This, in turn, requires stronger governance conditions to accompany these new technological and human capabilities.

Another challenge is to optimize the distribution of mining-canon revenues. The proposal to move toward a “mining canon 2.0” seeks to ensure that these resources translate into tangible results perceived by communities near operations, helping to reduce social conflict.

Diversification should also extend to downstream stages of the value chain. Rather than limiting itself to mining and exporting concentrates, Peru could create stronger incentives and conditions for industrialization processes that capture more value locally.

Finally, it is necessary to strengthen a social contract with the territories through consultation and dialogue mechanisms suited to each stage of mining activity. Exploration and production have different characteristics and levels of impact and therefore require differentiated mechanisms. Early, informed and genuine dialogue, accompanied by clear and stable rules, is essential.

Peru has a significant pipeline of mining projects, and mining accounts for more than one-third of national electricity demand. How do you see the capacity of mining companies in Peru—and across Latin America and the Caribbean—to accelerate decarbonization through renewable-energy contracts and electrification without losing operational competitiveness in the face of system costs?

Growing global demand for minerals is accompanied by increasing pressure for those minerals to be produced through cleaner operations. Energy and transport therefore play a fundamental role.

Peru has a significant base of hydropower and natural-gas generation, but there is still considerable room to develop solar and wind resources, particularly in areas with the potential to supply mining projects. Peru’s mining project pipeline, estimated at US$64 billion, is an opportunity for new projects to incorporate renewable energy sources from the design stage.

Moving in this direction will require improvements in competitiveness and in the timelines associated with permitting and environmental instruments, as well as incentives through green funds, sovereign funds or other competitive mechanisms capable of mobilizing investment when private appetite is insufficient.

The transition also requires stronger transmission infrastructure, especially because many mining operations are located in remote and isolated areas. Energy storage is also essential to guarantee reliability in a power mix with a larger share of renewables. In Peru, this area still faces regulatory challenges that will need to be addressed as the energy system evolves.

For Peru’s mining project pipeline to finally materialize, generation assets, transmission lines and logistics connectivity must be anticipated. Based on your experience in the sector, what are the priority infrastructure investments that the State and private sector should jointly promote to unlock the main productive corridors in Peru and across the region?

Infrastructure is a fundamental condition for Peru’s mining project pipeline to develop competitively. Of the approximately US$64 billion in identified projects, close to 70% corresponds to minerals such as copper, whose demand could require an increase close to doubling over the coming decades.

Priority investments include energy, water, transport and communications. In water infrastructure, it is necessary to develop storage and dam capacity, promote water reuse and strengthen oversight to ensure the quality of resources shared by mining and other productive activities such as agriculture.

In transport, many operations are located in mountainous areas far from ports. It is therefore essential to improve roads and assess rail solutions that can move minerals more competitively. At the same time, ports require expansions and new capacity to connect production with international markets.

These investments are not necessarily part of the mining business and therefore require coordinated action between the State and the private sector. Planning must anticipate project needs and create the conditions for infrastructure investment to accompany their development.

In this sense, public-private coordination, appropriate incentives, and regulatory stability and clarity are fundamental to transforming the project pipeline into concrete investment.