By Mariana Durao and Marcelo Rochabrun
Vale has been looking for new copper deposits in Peru, as demand for the metal used in electric car batteries is expected to increase with the world’s turn to clean energy.
The mining giant has at least two projects underway, in the early stages of drilling, after abandoning a third in a copper-rich region in southern Peru, the world’s second-largest producer of the commodity.
The two greenfield copper projects require a combined investment of US$7 million, according to the mineral exploration portfolio of Peru’s Ministry of Mines and Energy.
The move comes just as Vale is about to separate its base metals assets to release value from its nickel and copper businesses as demand for the battery metals grows.
Other commodities heavyweights such as BHP Group, Rio Tinto Group, and Glencore have also become optimistic about copper, expecting an increase in consumption as the global economy decarbonizes.
The two projects in the survey’s early stages are known as Umami and Chaska.
Vale abandoned the third one, Project S, in 2022 after a survey indicated that the area did not have the expected potential, the company said in response to Bloomberg News.
The iron ore giant holds copper concessions in 17 of Peru’s 24 states, according to state agency Ingemmet, which regulates mining rights.
According to the agency, it has bought up to 1,200 separate mining rights, with half of the assets totaling 450,000 hectares (1.1 million acres).
This corresponds to about three times the size of the city of São Paulo.
According to the company’s financial documents, copper exploration accounted for about 4% (or US$9.2 billion) of Vale’s revenues from continuing operations in 2022.
Most of the revenue (80%) is tied to iron ore mining.
With information from Bloomberg