Buenaventura suspends Peru mine on permitting delays

Buenaventura (NYSE: BVN), Peru’s top publicly traded precious-metals producer, has halted its Colquijirca’s Tajo Norte zinc-lead-silver mine for up to three years due to permitting delays.

The approval of a modified environmental impact study for the mine’s processing plant has been pending since the start of the COVID-19 pandemic. It has since been affected by several issues, including regulatory changes, the miner said. 

The company was planning to expand processing capacity to 25,000 tonnes per day at Colquijirca, located in the country’s central province of Pasco.

The Colquijirca operation comprises two deposits: the Marcapunta underground mine and Tajo Norte or north pit. 

According to Buenaventura, regular mining operations will continue at the Marcapunta underground mine, where it plans to increase production from 10,000 tonnes per day to 12,000 tonnes per day in the next two to three years.

It also said it will maintain its focus on improving operating efficiency to remain “competitive” while mining activities at Tajo Norte are suspended.

Bureaucracy

If political turmoil and community opposition were the main challenges faced by mining companies operating in Peru last year, red tape has become miners’ biggest headache in 2023.

At stake there is not only Peru’s status as the world’s No. 2 copper producer, but also an estimated $53 billion project pipeline, which would boost the country’s economy.

The government has been working on shortening waiting times for mining permits in recent months. The minister of energy and mines, Oscar Vera, met in August with industry actors to discuss ways to unblock mining projects and streamline permitting processes.

This is not the first time Buenaventura has faced delays in Peru. The company has been working on the San Gabriel gold and silver deposit since the 1990s. The $500 million project is scheduled to enter into production by the end of 2024 or early 2025. But with more efficient permitting, it could have been up and running a decade ago, chairman Roque Benavides said last month.