Miguel Cardozo: “Of 1,000 projects in Peru, 100 go to the drilling stage and only one reaches the mine”

In dialogue with La República, the president of Perumin 36, Miguel Cardozo spoke about why mining, highly intensive in our country, does not generate the results that the population expects. He also provides projections after the impact of the political noise and makes wishes to reach US$ 53,000 million in investment in eight years.

—There is discontent among the population in relation to mining because they do not see the expected development. What is your appreciation?

—It is not enough to have mining, something is wrong in some regions where, despite being in this activity, they do not take off. The political conflicts that exist have not allowed integrating efforts. With everything, mining production continued and where did the money go? The exploitation of resources continues to generate income that is not invested in the regions.

—How to optimize mining resources?

—We believe that there is a great need to integrate the regions among themselves, and a north, center and south macro-region is clearly recognized. Of all, without a doubt, it is the part south the one that has advanced in terms of integration and processes to optimize the use of mining income and the business that is generated so that the economy grows more, diversifies and has a more balanced economic development that gives opportunities to all.

“Is something going wrong?”

—Progress must be made so that there is true development and this is sustainable in all regions. There are some, like Moquegua, in which GDP per capita is close to S/50,000, but we still have others, like San Martín and Amazonas, where, with the jousts, they reach S / 7,000, and perhaps less. We are comparing with two regions that do not necessarily stand out for their mining activity, but in that same group are Puno, Ayacucho, Huancavelica and, surprisingly, Cajamarca, which barely exceeds S/8,000, and where the human development index is less than 0 .43%

—What is Perumin 36’s proposal to get out of this backward situation?

—There are Regional Governments that only invest up to 35% of the budget they give them in the year. Unfinished works, others that are not done, authorities imprisoned for corruption issues. In Perumin we must talk about territorial development. Consensus, planning and adequate design are needed. Honest and effective execution of the investments that must go to reduce the social gaps, to give more opportunities to those who have less. The population is going to realize that this system works, because today nothing reaches the regions. We would like to be part of the process of a project for the benefit of the population to be able to control, influence and carry out our proposal with the experience we have in land management.

—Did the government seek to reduce bureaucratization of permits for mining investments?

—Everything has tended to be bureaucratized. Before we had a cadastral system: when one submitted a petition, it took two months, maximum four months, to obtain the granting of the concessions. Today we need 14 months to have the concession title. In the exploration stage we had several very simple mechanisms that occurred in five days, when it was obvious that the activity did not affect the environment, and others in 60 days due to the verifications that were carried out. When going in with larger projects, 90 days or more. We have companies that are waiting four years for exploration and regularity indicates that we have to wait two to three years.

—How many projects have been affected?

—There are between three and four projects with a four-year wait, and between 10 and 15 that have already been waiting for two years for approval by the State. There are not many exploration projects, because all this normalization means that companies do not present their documentation and the consequence is that investment is scared away. Of 1,000 projects, only 100 go to the drilling stage and one becomes a mine. Investment is risky. The world is investing between US$13 and US$14 million per project and in 2012 it reached US$21 million. In Peru, we had more than US$1,000, and today we are at US$350,000, sometimes it is more. There is bureaucracies unnecessary and there is no desire to correct that, the Government indicates that it will do so, but there is internal opposition and they are the same as always.

—Taking into account the rise in the price of metals, are you willing to grant a surplus to what you already pay?

—We already grant a surplus and it is the royalty mechanism, which was changed in 2011. It is the percentage that one pays for the price of metals. There is a royalty that is gradual, that is, when there are higher prices, the amount is higher. Between 2021 and 2022 the tax times doubled, because we were at high prices. There is no lack of rules, plenty. The royalty is the appropriate mechanism to channel amounts. There was a voluntary contribution that the mining companies work with the affected populations under plans and it worked well, but in the Humala government it was set aside and they insisted that it be through royalties. There are also works for taxes. In every emergency, companies do this work to support the population, it was done with Covid-19 and now with the rains.

—How much has the political noise of recent years affected mining investments?

—In terms of exploration, we could have between US$600 million per year up to US$700 million and we are halfway there. In investment matters, quallaveco It is the only one that has decided on large projects. We are not growing. By 2031, by the end of this decade, we hope to have our entire portfolio of projects with an investment of US$53 billion and, if we reach this goal, then we would have a very important advance. All of this will redound, directly and indirectly, to the benefit of the population in the areas of influence.