On Tuesday, Copper Southern became the winner of the first bidding for the Michiquillay copper project in Peru, the first copper project to be openly tendered by Peru's government for nearly a decade.
Peru is second only to Chile, the world's second-largest producer of copper, while South Copper said in a statement that winning a bid would transfer 400 million U.S. dollars to the Peruvian government and pay a 3% royalty.
The Cajamarca region of northern Peru, where the project is located, is an undisputed world-class mining project with a mineral resource of 1.15 billion tonnes (marginal grade 0.4%) and an average copper grade of 0.63% at the Michiquillay Copper Project, which the South Copper Company 225,000 tonnes of copper, as well as by-products such as molybdenum, gold and silver, will be produced each year. Initial mines have a life expectancy of more than 25 years and project cash costs are very competitive.
The Michiquillay project estimates a capital investment of about 2.5 billion U.S. dollars and will start production by 2025 and will be one of the largest copper mines in Peru with an estimated annual production of 225,000 tons which means it will rank among the top 20 copper mines in the world .
In September last year, Nanchang Copper's president told Reuters that the Michiquillay project has some arsenic impurities that require relatively high investment to clean up the area.
Southern Copper is the world's fifth-largest copper miner with a market capitalization of 38.8 billion U.S. dollars. Copper prices have risen 32% over the past year as copper prices rise. Copper futures are higher Wednesday at 3.20 U.S. dollars per pound Tonne 7,060 US dollars) .This year, copper prices remained flat, copper prices in 2017 rose nearly 30%, and in December last year approached the four-year high.