Potential Growth, Potential Risk

The Next Generation Mining committee has been formed to capitalize on the investment opportunities across Latin America and met in Sao Paulo to discuss the distribution of funds within technology, HR, health and safety, exploration and supply chain funds.

Mining in Latin America has seen unprecedented growth in 2010. New projects across Argentina, Chile and Peru are attracting a modern gold rush from far reaching investment companies whose decision makers are deliberating on the most effective way to manage such gluttony of investment. How will investment be distributed? And how will they manage the environmental impact of such a raw development?

In 2006 the announcement of $4.5 billion of investment into Argentina alone was announced and the benefits of these ‘big money’ deals began to pay dividends. Increased demand and the lower cost of supply have created an opportunistic market in Latin America. Chile still retains un-capitalized gold, silver and copper resources, and has seen over $10 billion of investment over the last couple of years alone. Exploration across the continent is set to reveal more opportunities throughout 2010.

South America has become increasingly attractive as its geological potential is still largely untapped. This is especially true in Argentina where 75 percent of the mining area is still unexplored (according to latest research).

“For businesses, mining is on the verge of an exciting change threshold with volatile markets and emerging new technologies, increased customer demand, a dynamic workforce and a fascinating balance of a business model that modern mining makes something different, and more specialized with the use of collaborative tools. Mining companies will have to take actions which are increasingly critical for the business. They can either innovate or stagnate.” Yvan Garcia – CIO, Minera Chinalco Peru

The greatest investment seems to be coming from commercial giants such as china where their growing economy and demand for raw materials has pushed investment. They are willing to pay over the odds for the right product. The NGM Committee is well aware that if the demand is prevalent then investment into the best supply methods will unlock the potential already expected from the region.
The meeting was held because of the risks involved with increased investment into such a marginalized region. Indigenous communities and environmentalists have aired their concerns and it is up to governments and industry leaders to create a sustainable balance between the two.
“The most important change is in the optimization of end-to-end processes of the supply chain, where the goal is not just to push the [natural substances] to global markets, but to respond nimbly to the long-term relationships increasingly sophisticated customer and market dynamics.” Yvan Garcia – CIO, Minera Chinalco Peru

Representatives such as Chinalco - Yvan Garcia, CIO, Goldcorp - Paul Farrow, VP Safety & Health, Agnico-Eagle (AEM) - Marco Camez, Superintendent of Information Systems, Rio Novo Gold - Julio Carvalho, President and Amazon Mining LTDA - Cristiano Veloso, President and CEO were in attendance at the NGM LA summit and are committed to the future of Latin American Mining. Can a sustainable future be achieved when growth is almost guaranteed?