Struggling Argentina expects US$14 billion in mining exportsThe new Argentinian government is promising to end a series of capital controls that have been propping up the peso – a move that would benefit mining.
Reuters reported on Sunday that president-elect Mauricio Macri will lift the clamp-down on dollar purchases by out-going president Cristina Fernández, as early as December 14.
Fernández restricted imports and repatriated export revenue since she was re-elected in 2011. She also created currency controls that hurt firms such as Chevron Corp, Petronas and Total, and led Brazil’s Vale (NYSE:VALE) to cancel its $6bn Río Colorado potash project in the country.
During the election the country’s mining chamber estimated there are at least $5 billion worth of mining projects waiting for a more supportive government to go ahead with plans.
Most of the projects hoping for a mining-friendly new president are, according to the Argentine Mining Chamber, copper-focused ventures.
One of the most touted is Glencore’s (LON:GLEN) plans to invest about $3 billion over three years at El Pachón, located in San Juan province.
Yamana Gold’s (TSX:YRI)(NYSE:AUY) Cerro Moro, a gold and silver mine in Santa Cruz province, would be another project to benefit if October’s presidential elections herald an easing of capital restrictions, the chamber of mines said during the election.
The Canadian miner has promised to invest $398 million in the venture, but construction won’t start unless federal regulations are changed including currency controls and repatriation of export revenue, a provincial mining department official told País Minero (in Spanish).
Then, there’s Goldcorp’s (TSX:G) (NYSE:GG) Cerro Negro, which began commercial output in January and is targeting production of 425,000 to 475,000 ounces this year.
And the Chubut province is considering reopening talks with Pan American Silver (TSE:PAA) with the goal of resuming development of its Navidad silver project.
According to Buenos Aires-based Quevedo Law Firm Principal, Ignacio Celorrio, the country’s recovering mining industry could generate exports worth more than US$14 billion within five years, as Argentina emerges from several years of declining resource deals and sales.
