BHP, Lundin Mining bet $400M on Argentina copper hub

BHP (ASX, NYSE: BHP) and Lundin Mining’s (TSX: LUN) joint venture in Argentina is investing more than $400 million near the Chilean border, aiming to develop a multibillion-dollar copper project that could become the country’s next major production hub.

The venture, Vicuña Corp, was created in January after the partners acquired Filo Corp. It controls both the Filo del Sol deposit straddling the Argentina-Chile border and the Josemaría deposit in Argentina’s San Juan province. 

Since the acquisition, Vicuña has carried out tests and pre-construction work at Josemaría, with plans to seek approvals and begin production in 2030. The company also extended the mine’s useful life from 19 to 25 years after confirming higher-than-expected resources and set ore processing capacity at 175,000 tonnes per day.

The budget already places Vicuña among Argentina’s largest foreign investors this year, even as final development costs are still being calculated, Vicuña’s senior country manager for Argentina and Chile told Bloomberg News.

The company is also preparing an application for tax, customs, and currency exchange benefits under Argentina’s large investment incentives program, known as RIGI.

“RIGI is critical,” Morea said. “It levels the playing field and allows for the project to be competitive in tax terms when compared to other jurisdictions in Latin America and across the world.”

CEO appointed

Vicuña expects to submit a technical report to its board by March, outlining timelines, production forecasts, and processing methods.

To guide the next phase, the company appointed this week mining veteran Ron Hochstein as chief executive officer. Hochstein, who brings more than three decades of industry experience, most recently serving as Chair and CEO of Lundin Gold, will take the helm on November 7.

Argentina has not produced copper since 2018, but a growing pipeline of projects could elevate the country into the world’s top 10 producers.