Peru Faces Surge in Large-Scale Informal Copper Mining as Government Confirms $300 Million Operation

The Peruvian government has officially acknowledged the existence of large-scale informal copper mining, marking a significant shift in how authorities address the sector.

Energy and Mines Minister Jorge Montero confirmed this week that the informal Apu Chunta mine, run by the indigenous Pamputa community, produces an estimated 30,000 metric tons of copper each year. At current prices, this output is valued at around $300 million.

Pamputa owns the land where the mine operates, but Las Bambas, a major copper project managed by China’s MMG Ltd., retains the mineral rights.

Las Bambas plans to expand with a new open-pit mine in the same area during the 2030s, which would require purchasing land from the community.

The situation highlights the ongoing tension between local landowners and mining concession holders, a recurring theme in Peru’s resource sector. Peru stands as the world’s third-largest copper producer, with copper output reaching 2.74 million tons in 2024.

However, this figure marked the first annual decline after four years of growth. Social conflicts and regulatory delays have contributed to stagnation, even as the government projects a modest production recovery in 2025.

Peru’s Informal Copper Mining Boom Raises Global Stakes

The rise of informal mining adds another layer of complexity to the industry. Thousands of small-scale miners have moved into areas without legal mining rights, often overlapping with concessions held by large companies.

Informal miners have disrupted exploration projects by Southern Copper Corp., First Quantum Minerals, and Teck Resources’ Zafranal project. Despite these incursions, informal copper production remains small compared to formal output.

The Peruvian government estimates that illegal mining generates over $3 billion annually, surpassing revenue from drug trafficking. The state’s program to regularize small-scale mining, known as REINFO, faces criticism for loopholes and limited effectiveness.

The program is set to expire this year, and authorities are working on a replacement that closes gaps exploited by illegal operators. The government’s acknowledgment of large-scale informal copper mining signals a new approach to a longstanding issue.

The outcome will affect not only local communities and mining companies but also global copper markets as demand continues to rise.

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