Southern Copper Resumes Tia Maria Project in Peru with Revised Investment

Southern Copper

Southern Copper, a subsidiary of Grupo Mexico, is moving forward with its Tia Maria copper mining project in Peru after a delay of several years due to community opposition. The company has revised its initial investment estimate to $1.8 billion, up from the original $1.4 billion, signaling a renewed commitment to this controversial project.

Tia Maria: A Controversial Project Set to Boost Copper Production

The Tia Maria project, located in the Arequipa region of Peru, is expected to produce around 120,000 metric tonnes of copper annually. Despite its potential, the project has faced significant opposition due to concerns over its environmental impact, which were raised in its original 2014 environmental impact statement. In response to these concerns, Southern Copper has made several changes, including updating the environmental study. This update was approved in November 2023 and includes the decision to abandon plans for a desalination plant as the primary source of water for the project.

The project’s first phase of construction, scheduled for this year, will focus on developing essential infrastructure such as roads, access points, railways, and temporary encampments. A 59km enclosure has already been established around the main property.

Economic Impact and Future Prospects

Once fully operational in 2027, Tia Maria is projected to generate significant economic benefits. The project will create 764 direct jobs and an additional 4,800 indirect jobs. Southern Copper expects to export $17.5 billion worth of copper over the first 20 years of the project’s operation. This production boost comes at a time when Peru continues to be one of the world’s top copper producers.

Southern Copper's commitment to the Tia Maria project follows a positive year for the company. In 2024, the company reported a record $11.4 billion in net sales and a profit of $3.4 billion. This growth was driven by higher copper prices and increased sales of molybdenum, zinc, and silver.

Challenges at Los Chancas

In addition to Tia Maria, Southern Copper is developing the Los Chancas project in the Apurimac region, which is expected to produce 130,000 tonnes of copper and 7,500 tonnes of molybdenum annually once operational in 2031. However, the project has been delayed due to illegal mining activities in the area. Southern Copper is working closely with Peruvian authorities to address this issue and plans to restart environmental impact, hydrogeological, and geotechnical studies once the situation is resolved.