BHP and Lundin Mining Inject Over $400 Million into Argentine Copper Project

Major Investment Targets Argentina's Copper Potential

A significant investment exceeding $400 million is being channeled into Argentina's mining sector by a joint venture between global mining powerhouses BHP and Lundin Mining. The partnership, operating under the name Vicuña Corp., is focused on developing a multibillion-dollar copper project primarily centered around the Josemaría deposit in San Juan province, near the Chilean border. This substantial initial funding is allocated to crucial pre-construction activities, marking one of Argentina's largest foreign investments this year.

The initiative is poised to transform Argentina into a major copper production hub, addressing the escalating global demand for the metal driven by renewable energy technologies and electric vehicles. Argentina ceased copper production in 2018, and successful projects like Vicuña could position the country among the world's top 10 copper producers by 2030.

Vicuña Corp. and Project Scope

Formed in January following the acquisition of Filo Corp., Vicuña Corp. now controls both the Josemaría deposit in San Juan province and the Filo del Sol deposit, which straddles the Argentina-Chile border. The Josemaría deposit is the immediate focus for pre-construction work.

Key aspects of the project include:

• An initial investment of over $400 million for pre-construction.
• Targeted production commencement in 2030.
• An extended mine life from 19 to 25 years, following recent geological assessments.
• Planned ore processing capacity of 175,000 tonnes per day.
• The appointment of mining veteran Ron Hochstein as CEO to guide the project's next phase.

Economic Impact and Regulatory Support

The project is expected to bring considerable economic benefits to Argentina, including direct job creation during construction and operations, development of supporting industries, increased export revenues, and significant tax contributions.

Vicuña Corp. is actively preparing an application for Argentina's Large Investment Incentives Regime (RIGI). José Luis Morea, Vicuña's senior country manager for Argentina and Chile, emphasized the critical role of RIGI, stating, 'RIGI is critical. It levels the playing field and allows for the project to be competitive in tax terms when compared to other jurisdictions in Latin America and across the world.' This program, implemented under President Javier Milei, offers extended tax breaks and access to international dispute courts for investments exceeding $200 million, aiming to attract major capital to the country.

Future Outlook

While the initial $400 million investment is substantial, it represents the beginning of what is anticipated to be a multi-billion dollar development. The joint venture plans to submit a comprehensive technical report to its board by March of next year, detailing timelines, production forecasts, and processing methods. This strategic move by BHP and Lundin Mining underscores confidence in Argentina's mining potential and the long-term demand for copper.