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Released March 28, 2022 | cordoba, argentina
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Researched by Industrial Info Resources (Sugar Land, Texas)--The replacement of fossil fuels with renewable energy sources to provide electricity is what comes to mind when discussing the energy transition across the globe. It is electricity that paves the way to decarbonizing transportation, housing and industries.
In Latin America, hydroelectric power is the most-used source of renewable energy. But in the last few years, wind and solar photovoltaic power have made inroads. New technologies, like offshore tidal energy and green hydrogen, could contribute to a faster transition.
The energy transition is not possible without mining. In order to build and develop the technologies that will allow the transition, minerals like copper, nickel, cobalt and lithium, among others, are crucial.
Copper is one of the most vital materials in the technology that will drive the energy transition. It is used in wind turbines, electric cars, solar photovoltaic parks and power lines.
As the energy transition gains more momentum in the next few years, global copper demand is expected to increase, to the benefit of copper-rich countries in Latin America.
Chile produces the most copper in the world, amounting to 28% of global production, according to Chile's National Geology and Mining Service (SERNAGEOMIN).
Also, Peru accounts for 10% of global copper production and Mexico produces 3.4% of the world's copper.
The importance of these three countries to the global copper supply chain cannot be overstated, which is why the recently-elected leaders of each country and their agendas for the mining industry are points of concern. Various measures to nationalize parts of the mining industry, and/or increase royalties or taxes are under discussion, and could have serious repercussions on mining investments that are needed to attain the energy transition.
Peruvian President Pedro Castillo has promised to raise mining royalties and sanction mining companies that do not respect the country's climate agreements. During his campaign, he even promised to nationalize the mining industry if he deemed it necessary. Castillo has failed to implement new mining laws so far and is facing anti-mining social protests, which have disrupted mining operations.
Mexican President Andrés Manuel López Obrador announced he was seeking to apply a mining reform that consists of increasing taxes on mining companies and greater government control over the mining sector. If this reform is approved, the government of Mexico may not grant mining concessions to companies. The scope of the reform will not be clear until its approval, but it could cover copper, lithium and rare earth mining, all of which are important for the energy transition.
Chile is drafting a new national constitution. Proposed constitutional reforms could affect the mining sector. These include nationalization of mining companies; elimination of existing water rights; and annulment of mining and forestry concessions on indigenous land. In addition, a new mining royalty is being discussed. President Gabriel Boric has been in favor of the new mining royalty law and the new constitution. These situations have raised the level of uncertainty among mining companies.
Industrial Info is tracking more than US$114 billion in copper mining investment in the region. Of this amount, about 18% is under construction and 78% is in the planning stage. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Project Database can click here for a list of detailed project reports.
Click on the image at right for a breakdown by country of active copper mining projects in Latin America.
The distribution of investment is divided as follows: Chile is home to 44% of the copper investments in Latin America, accounting for more than US$50 billion. Peru holds 28% of the copper mining projects in the region, accounting for US$32 billion; Argentina accounts for 13% and Mexico accounts for 5%.
On the other hand, the power-consuming operations of the copper mining sector also will be subject to the energy transition. As such, a balance must be found between the use of fossil fuels to build and maintain mines, the decarbonization of the sector and the continuation of the industry.
In order to achieve the energy transition, mining companies and copper-producing countries are implementing the following measures: a shift toward the use of renewable energy; more electrification; utilization of green hydrogen; use of water resources and implementation of circular economies. Countries in the region have shown interest in reaching decarbonization goals that were agreed upon in the Paris Agreement on climate change.
Chile has acted most aggressively to achieve these goals, having vowed to decarbonize its mining industry by 2050. Chile's first goal is to include renewable energy in mining power supply contracts, with the objective of eventually using 100% renewable energy sources. Antofagasta plc's (London, England) Minera Zaldivar operation is supplied by electric power derived solely from renewable energy sources. Chilean state-owned miner Codelco (Santiago, Chile), is doing the same thing; in 2021, it obtained nearly 70% of the power for the Chuquicamata Copper Mine division from renewable energy sources.
Mining companies have begun to electrify some of their processes. They have included electrical mining equipment, trucks and buses. New technologies are under study, like the use of green hydrogen as fuel for trucks and mining equipment.
There has not been any large-scale battery energy storage systems (BESS) implemented in Latin America's copper industry. This technology could bring energy solutions to mining operations in remote areas, since they can help make up for intermittent energy sources like solar and wind energy.
Water also plays an important role in the mining industry, which is using technologies like seawater desalination to maintain operations. Industrial Info is tracking more than US$4.7 billion worth of desalination projects in Latin America's mining industry. Subscribers can click here for a list of project reports.
Industrial Info Resources (IIR) is the world's leading provider of market intelligence across the upstream, midstream and downstream energy markets and all other major industrial markets. IIR's Global Market Intelligence Platform (GMI) supports our end-users across their core businesses, and helps them connect trends across multiple markets with access to real, qualified and validated project opportunities. Follow IIR on: LinkedIn.
In Latin America, hydroelectric power is the most-used source of renewable energy. But in the last few years, wind and solar photovoltaic power have made inroads. New technologies, like offshore tidal energy and green hydrogen, could contribute to a faster transition.
The energy transition is not possible without mining. In order to build and develop the technologies that will allow the transition, minerals like copper, nickel, cobalt and lithium, among others, are crucial.
Copper is one of the most vital materials in the technology that will drive the energy transition. It is used in wind turbines, electric cars, solar photovoltaic parks and power lines.
As the energy transition gains more momentum in the next few years, global copper demand is expected to increase, to the benefit of copper-rich countries in Latin America.
Chile produces the most copper in the world, amounting to 28% of global production, according to Chile's National Geology and Mining Service (SERNAGEOMIN).
Also, Peru accounts for 10% of global copper production and Mexico produces 3.4% of the world's copper.
The importance of these three countries to the global copper supply chain cannot be overstated, which is why the recently-elected leaders of each country and their agendas for the mining industry are points of concern. Various measures to nationalize parts of the mining industry, and/or increase royalties or taxes are under discussion, and could have serious repercussions on mining investments that are needed to attain the energy transition.
Peruvian President Pedro Castillo has promised to raise mining royalties and sanction mining companies that do not respect the country's climate agreements. During his campaign, he even promised to nationalize the mining industry if he deemed it necessary. Castillo has failed to implement new mining laws so far and is facing anti-mining social protests, which have disrupted mining operations.
Mexican President Andrés Manuel López Obrador announced he was seeking to apply a mining reform that consists of increasing taxes on mining companies and greater government control over the mining sector. If this reform is approved, the government of Mexico may not grant mining concessions to companies. The scope of the reform will not be clear until its approval, but it could cover copper, lithium and rare earth mining, all of which are important for the energy transition.
Chile is drafting a new national constitution. Proposed constitutional reforms could affect the mining sector. These include nationalization of mining companies; elimination of existing water rights; and annulment of mining and forestry concessions on indigenous land. In addition, a new mining royalty is being discussed. President Gabriel Boric has been in favor of the new mining royalty law and the new constitution. These situations have raised the level of uncertainty among mining companies.
Industrial Info is tracking more than US$114 billion in copper mining investment in the region. Of this amount, about 18% is under construction and 78% is in the planning stage. Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Project Database can click here for a list of detailed project reports.
Click on the image at right for a breakdown by country of active copper mining projects in Latin America.The distribution of investment is divided as follows: Chile is home to 44% of the copper investments in Latin America, accounting for more than US$50 billion. Peru holds 28% of the copper mining projects in the region, accounting for US$32 billion; Argentina accounts for 13% and Mexico accounts for 5%.
On the other hand, the power-consuming operations of the copper mining sector also will be subject to the energy transition. As such, a balance must be found between the use of fossil fuels to build and maintain mines, the decarbonization of the sector and the continuation of the industry.
In order to achieve the energy transition, mining companies and copper-producing countries are implementing the following measures: a shift toward the use of renewable energy; more electrification; utilization of green hydrogen; use of water resources and implementation of circular economies. Countries in the region have shown interest in reaching decarbonization goals that were agreed upon in the Paris Agreement on climate change.
Chile has acted most aggressively to achieve these goals, having vowed to decarbonize its mining industry by 2050. Chile's first goal is to include renewable energy in mining power supply contracts, with the objective of eventually using 100% renewable energy sources. Antofagasta plc's (London, England) Minera Zaldivar operation is supplied by electric power derived solely from renewable energy sources. Chilean state-owned miner Codelco (Santiago, Chile), is doing the same thing; in 2021, it obtained nearly 70% of the power for the Chuquicamata Copper Mine division from renewable energy sources.
Mining companies have begun to electrify some of their processes. They have included electrical mining equipment, trucks and buses. New technologies are under study, like the use of green hydrogen as fuel for trucks and mining equipment.
There has not been any large-scale battery energy storage systems (BESS) implemented in Latin America's copper industry. This technology could bring energy solutions to mining operations in remote areas, since they can help make up for intermittent energy sources like solar and wind energy.
Water also plays an important role in the mining industry, which is using technologies like seawater desalination to maintain operations. Industrial Info is tracking more than US$4.7 billion worth of desalination projects in Latin America's mining industry. Subscribers can click here for a list of project reports.
Industrial Info Resources (IIR) is the world's leading provider of market intelligence across the upstream, midstream and downstream energy markets and all other major industrial markets. IIR's Global Market Intelligence Platform (GMI) supports our end-users across their core businesses, and helps them connect trends across multiple markets with access to real, qualified and validated project opportunities. Follow IIR on: LinkedIn.
