Peru minister says US$1.4B Tia Maria mine a “no go”

Peru’s economy and finance minister has cast further doubt about Southern Copper’s (NYSE: SCCO) long-delayed US$1.4 billion Tia Maria project by saying he believed the proposed mine in the southern Islay province was “socially and politically” unfeasible. 

“Tía María has already gone through three or four waves of community and governmental attempts of repression and death. I don’t think it’s appropriate to try again if you’ve already crashed into a wall of social resistance once, twice, three times…,” minister Pedro Francke told local media this week. 

President Pedro Castillo has singled out the Tia Maria project as a non-starter under his administration, a view that has been echoed by other members of his cabinet, including Minister of Energy and Mines Ivan Merino.  

Southern Copper, a subsidiary of Grupo Mexico, has experienced several setbacks since it first announced its intention to develop Tía María in 2010.  

Construction plans have been halted and readjusted twice, in 2011 and 2015, due to fierce and at times deadly opposition by locals. They worry about Tia Maria’s impacts on nearby crops and water supplies. 

In 2019, Peru’s previous government approved Tia Maria’s licence, a decision that triggered yet another wave of protests in the Arequipa region. 

Developing the controversial project would be a breakthrough in a country where the mining industry’s relations with isolated rural communities often sour. 

The mine is expected to produce 120,000 tonnes of copper a year over an estimated 20-year lifespan. It would employ 3,000 people during construction and provide 4,150 permanent direct and indirect jobs. 

Despite its ongoing opposition to Tia Maria, the Castillo administration is working on a new approach to community relations and red tape to unlock more of the country’s huge mineral wealth.  

Peru is the world’s second-biggest copper producer after neighbouring Chile and a major supplier of silver and zinc.