A copper, gold and silver mining project in the Argentine province of San Juan filed a request to enter the Incentive Regime for Large Investments (RIGI), a scheme of tax breaks, currency-exchange perks, and other sweeteners.
The Vicuña Argentina project represents a planned investment estimated between US$15 billion and US$17 billion over the next decade.
Vicuña Argentina is a joint venture between the Australian and Canadian mining companies BHP and Lundin Mining. After filing for inclusion in the RIGI on Thursday, it pledged to invest US$2 billion within two years if the government accepted its bid to join the regime.
Economy Minister Luis Caputo tweeted that the project was “potentially the largest foreign direct investment in mining in our country’s history.”
Vicuña is made up of the Josemaría and Filo del Sol deposits, close to the border with Chile. In May, BHP and Lundin Mining announced that the deposits’ combined resources place the Vicuña district among the 10 largest known copper deposits worldwide.
In January, both companies completed the acquisition of Filo Corp., a Toronto Stock Exchange-listed company that owned 100% of the Filo del Sol copper project. Before that, Lundin Mining owned 100% of the Josemaría project, from which BHP bought half.
The companies then formed the Canadian-incorporated joint venture company, Vicuña Corp.
BHP chief executive officer Mike Henry said in January: “BHP is one of the world’s leading producers of copper, a metal essential to global economic growth, the energy transition and to the rapidly growing demand for data centres to support the harnessing of artificial intelligence.”
It is a watershed moment for mining in Argentina. This week, the Mendoza provincial Senate approved the San Jorge Copper Project. Mining projects in the province have been effectively blocked by a 2007 law that prohibits the use of certain toxic chemicals, such as cyanide, mercury, and sulphuric acid, in mining. However, on Tuesday the local Senate approved the project’s environmental impact assessment, greenlighting the project. The industry views it as a test case that could open the door to future projects.
Attempts to allow mining projects in the province have been heavily criticized by both environmental groups and the province’s key wine industry, who say that allowing mining in the region would pollute fresh water resources and threaten vineyards.
Approved in mid-2024, the RIGI is a framework designed to entice large investment in Argentina. While the country is rich in natural resources, investors have been wary of entering the market because of its economic instability and frequent use of currency controls, which can leave money stuck in the country.