While the situation for some of the major miners in Peru remains challenging, Grupo Mexico-owned Southern Copper Corporation (SCC) has so far avoided being affected at its key operations there, namely Toquepala, Tia Maria, Los Chancas and Michiquillay.
SCC’s current capital investment program for this decade exceeds $15 billion and includes investments in the Buenavista Zinc, Pilares, El Pilar and El Arco projects in Mexico and in the Tia Maria, Los Chancas and Michiquillay projects in Peru. This capital forecast includes several infrastructure investments, including key investments to bolster the competitiveness of the El Arco project.
Mexico forms an important part of its growth plans. German Larrea, SCC Chairman of the Board stated in its Q4 and FY2022 results: “We continue to focus on expansion and expect to deliver ore to the Caridad concentrator from the Pilares mine in Q2 2023, contributing with 35,000 t of copper annually. Additionally, the new zinc concentrator at Buenavista is expected to begin operations in H2 2023 generating 100,000 t of zinc and 20,000 t of copper per year.”
Starting with the Buenavista zinc project in Sonora, the engineering study has been completed, and the project has all the necessary permits. When operating, this facility will double the company’s zinc production capacity and provide more than 2,000 operational jobs. The capital budget of the project is $416 million, most of which has already been invested.
Pilares is also in Sonora, located 6 km from La Caridad, this project consists of an open-pit mine operation which will significantly improve the overall ore grade going to the Caridad processing plant (considering the 0.78% expected from Pilares and the 0.29% from La Caridad going forward).
The budget for Pilares is $159 million, most of which has already been invested. The project is currently operating and delivering copper mineral oxides to the SX-EW facilities of the Caridad operation. SCC expects to produce ore for the Caridad concentrator at full capacity in by Q2 2023.
Finally, El Pilar, also in Sonora is a low-capital intensity copper greenfield project about 45 km from the Buenavista mine. Its copper oxide mineralisation contains estimated proven and probable reserves of 317 Mt of ore with an average copper grade of 0.249%. SCC anticipates that El Pilar will operate as a conventional open-pit mine with an annual production capacity of 36,000 t of copper cathodes. This operation will use highly cost efficient and environmentally friendly SX-EW technology. The budget for El Pilar is $310 million.
In Mexico’s Baja California is El Arco, a world-class copper deposit located in the central part of the Baja California peninsula with ore reserves of over 1,230 Mt with an average ore grade of 0.40% and 141 Mt of leach material with an average ore grade of 0.27%. The project includes an open-pit mine combining concentrator and SX-EW operations. Annual production is expected to total 190,000 t of copper and 105,000 oz of gold. SCC has completed the environmental baseline study for the mine and industrial facilities and is reviewing the basic engineering analysis to request the environmental impact permits.
Its Mexican operations have also made progress with sustainability goals. The open pit mine La Caridad and the Sonora Metallurgical Complex (smelter and refinery) have received Copper Mark certification. Both units were assessed by this independent assurance system to demonstrate that SCC’s copper is produced responsibly. Additionally, La Caridad received the Molybdenum Mark.
