By Robert Kozak
LIMA--Investments in Peru's mining sector is seen gaining 16%
this year, following last year's 18% increase, worth $8.55 billion,
Scotiabank said.
Mining investments last year came from 547 companies, although
53% were made by five companies in large mainly base metals
projects: Toromocho, Las Bambas, Minas Conga, Antamina and Cerro
Verde.
"During 2013, it is probable that a similar number of companies
will make a similar number of investments in mining. However, about
50% of the investment will come from five mega-projects," the bank
said.
Scotiabank says this year the main investments will be made by
Xstrata PLC (XTA.LN) in its $5.2 billion Las Bambas copper deposit,
and by Minera Chinalco Peru in its $3.5 billion Toromocho
project.
Minera Chinalco Peru is a subsidiary of Aluminum Corp. of China
Ltd. (ACH, 2600.HK, 601600.SH).
In regards to Toromocho, Scotiabank said, "The company will
start to produce copper in 2014, and as such the biggest part of
the investment will be made in 2013."
Xstrata said Tuesday that it had spent $1.1 billion last year on
Las Bambas, "which will commence commissioning at the end of
2014."
It also said it had spent $600 million at the Antapaccay copper
project in southern Peru, where production started in November last
year.
Another large-scale investment is by Sociedad Minera Cerro Verde
SAA (CVERDEC1.VL) as it continues work on its $4.4 billion mine
expansion in southern Peru.
Canada's Hudbay Minerals (HBM), which forecasts full production
in the second quarter of 2015 at its Constancia project, expects to
spend about $961 million there in 2013.
Anglo American PLC (AAL.LN) is expected to submit its Quellaveco
copper project to its board for approval this year.
Scotiabank said investments by Minera Yanacocha at its Minas
Conga project will drop significantly this year due to the
suspension of most work there.
Antamina completed its expansion project last year, which helped
the company boost its copper production by 33% in 2012 over the
prior year.
Peru's Ministry of Energy and Mines is forecasting a rise of
only 12% in mining sector investments this year.
Peru is the world's third largest producer of copper and
produces large amounts of other base and precious metals.
Write to Robert Kozak at robert.kozak@dowjones.com
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