Energy investment boom expected in northern Chile
Investment in Chile’s energy industry is expected to jump over the next five years to as much as $3 billion, which could add about 2.5% to the country’s potential GDP growth, US-based Trade Commissioner Rodrigo Mladinić said.
Speaking at a media briefing during MINExpo 2016 this week, Rodrigo Mladinić said that projects, many of them in the renewables sector, are expected to also boost machinery acquisitions and generate close to 3,000 new jobs.
The projects, many of them in the renewables sector, are expected to boost machinery acquisitions and generate close to 3,000 new jobs.
The trade officer noted that Chile’s rising energy demand, pushed by a booming mining production and economic growth in the past 10 years, has already triggered the creation of 29 solar farms supplying the central grid, with another 15 planned.
In the north of the country, which is where most copper operations are located, even more have been built, Mladinić said.
While prices for copper, Chile’s main export, remain subdued, the officer said there are strong signs in the market that suggest the red metal will begin rising by mid 2018. The timing coincides with what industry players such as Antofagasta (LON:ANTO) expect the metal to start swinging back into deficit amid a lack of new projects and as Chinese demand continues to grow.
There already are encouraging signs, such as this week’s move by Teck Resources, Canada’s largest diversified miner, requesting environmental approval for a revised expansion project at its Quebrada Blanca copper mine in northern Chile.
Mladinić noted that projects like that one are expected to push global demand for engineering services in the mining sector to over $36 billion by 2020.
A similar figure is estimated for sectors other than mining. Construction work and equipment related to engineering companies may represent a further $29.7 billion. Engineering for closure plans, in turn, may reach $20 million per project, the executive said.