Roque Benavides Developed His Profes

Roque Benavides developed his profes-
sional career in Compañía de Minas

Buenaventura S.A.A. since 1977. He
began working as Project Engineer, then
as Chairman Assistant, and later, in 1985,
as Finance and Administration Manager.
Appointed CEO in 2001, and Board
member since 2003. In 2011 he assumed
the position of Chairman of the Board of
Directors.
Civil Engineer by Pontificia Universidad

Católica del Perú (PUCP), and MBA by
Henley Business School at the University
of Reading, UK. He successfully comple-
ted the Program for Management
Development at Harvard Business
School, and the Advanced Management
Program at Oxford University. In 2017 he
was awarded Doctor Honoris Causa by
the Major National University of San
Marcos, and in 2011 he received the
Palmas Magisteriales in the degree of
Amauta and the Orden del Trabajo in the
degree of Grand Officer by the Peruvian
government.
He served as President of the National

Society of Mining, Petroleum and Energy
(SNMPE), and currently he is the
President of the Peruvian Confederation
of Private Business Institutions (Confiep).
1
2
PREFACE 6
INTRODUCTION
TABLE OF CONTENTS
10
1. OVERVIEW OF THE MINING SECTOR 12

1.1 Mining and its role in the peruvian economy 15
1.2 The virtuous circle of mining 18
1.3 National GDP and mining GDP 20
1.4 Mining production 25
1.5 Mining potential 26
1.6 Illegal mining 30
2. MINING REGIONS OF PERU 32

2.1 Cerro de Pasco 40
2.2 Ancash 42
2.3 Cusco 44
2.4 Moquegua 45
2.5 Apurimac 46
2.6 Cajamarca 48
2.7 Tacna 50
2.8 Ayacucho 51
2.9 Junin 52
2.10 Huancavelica 53
2.11 Arequipa 54
2.12 La Libertad 56
2.13 Piura 57
2.14 Lambayeque 58
2.15 Lima 59
3
3. MINING’S CONTRIBUTIONS 60
3.1 Employment 64
3.2 Health and education 67
3.3 Integrated production chains 69
3.4 Investments 71
3.5 Taxes 72
3.6 Mining canon 73
3.7 Public investment 76
3.8 Mining fosters opportunities 77
4. BUENAVENTURA’S CONTRIBUTIONS 78
4.1 Our history 80
4.2 Relations 87
4.3 Local employment 87
4.4 Local procurements and services 88
4.5 Productive development 88
4.6 Infrastructure 90
4.7 Human development 91
4.8 Good corporate governance
practices 92
4.9 Project methodology 95
4.10 International certifications
(ISO and OHSAS) 96
5. RESPONSIBLE WATER MANAGEMENT 98

5.1 Cost of limited water access 100
5.2 Water resources management 100
5.3 Water infrastructure and storage 101
5.4 Possibilities to keep improving 104
5.5 The brotherhood of water 104
4
6. RESPONSIBLE ENVIRONMENTAL MANAGEMENT 106
6.1 Environmental monitoring 108
6.2 Citizen participation 108
6.3 Mine closure 109
7. WORKING TOWARDS SHARED

SOCIAL RESPONSIBILITY 112
7.1 What is social responsibility? 114
7.2 From social responsibility to
shared social responsability 114
7.3 Mining companies and their commitment 116
7.4 What should we expect from the government? 116
7.5 What should we expect from local communities? 117
7.6 Public-private partnerships 117
8. NEW CHALLENGES FOR

THE MINING INDUSTRY 120
8.1 Increase in capital expenditures and
operating expenses 122
8.2 The rule of law and its enforcement 125
8.3 Purchase of lands 126
8.4 Environmental policies:
approval of the EIA 127
8.5 Convention 169, prior consultation,
and indigenous peoples by Cesar Humberto Cabrera 129
8.6 Opportunity cost 147
8.7 What the future holds 149
8.8 Speech given upon being named
Doctor Honoris Causa by the UNMSM 150
CONCLUSIONS 162
5
PREFACE
Buenaventura was born in the Andes mountains in
1953, in the region of Huancavelica, where Julcani, our
flagship mine, is located. After 65 years in business,
we are in a good position to stop and reflect on the
challenges and the future of mining. Indeed, this activity
is strategic for Peru, given its significant economic and
social influence. Responsible mining and its contribution
to the development of Peru by Roque Benavides offers
an analysis of these challenges, as well as the future
potential of Peruvian mining.
As Chairman of the Board of Buenaventura and the

current president of the Peruvian Confederation of
Private Business Institutions (CONFIEP) Roque Benavides
is a Peruvian committed to his country. His travels
throughout Peru are extensive, allowing him to constantly
observe it and analyze it in his role as citizen, professional,
business icon, discussion panelist, and voracious reader,
always ready to engage in a conversation and never afraid
to talk about politics, understood as the duty to serve
others and not to take advantage of such positions. This
book is a statement to his vocation for Peru.
In this third edition, the author also takes on the role

of communicator, outlining arguments and offering
the latest data on Peruvian mining and the great
progress it has made working hand-in-hand with the
agriculture sector. Indeed, mining and agriculture are
both members of the brotherhood of water, which seeks
to benefit peasant communities with improved access
to this resource, while acting as a driving force behind
development, primarily in those isolated geographic areas
where progress is slow to arrive and the government’s
presence is limited.
6
The author stresses how critical these last 28 years have been for Peru.
The implementation of a number of projects has allowed mining to
become the backbone of the Peruvian economy. Today, our country is
among the world’s leaders in gold, silver, zinc, and lead production, all of
which are in high demand in the United States, China, Switzerland, Japan,
Canada, and the European Union.
It is important to point out that Peru is a service economy, and not a

primary or export-based economy, as some mistakenly claim. This has
much to do with formal mining, which forges links with other industries,
such as services, construction, and metalworking, creating thousands
of formal jobs nationwide. According to the statistics of the Ministry of
Energy and Mines mining accounts for over 10 percent of Peru’s Gross
Domestic Product and 60 percent of its exports. The Peruvian Institute
of Economics estimates that 1.2 million Peruvians depend on mining,
whether directly or indirectly.
In this latest edition, the author inlcudes issues that deserve special
attention, such as the growth of illegal and informal mining. Illegal mining
extracts minerals in protected natural areas, and entails harmful effects
for society, including criminal activity, human trafficking, and labor
exploitation; while informal mining is active in areas where the activity is
authorized, but it does not have the proper permits. What is to be done
about this problem? The government needs to take up a more integral
role, including regional and local authorities, in fighting illegality and
fostering formalization.
In 2017, Roque Benavides was awarded the degree of Doctor Honoris

Causa from the Major National University of San Marcos. This book
includes some of the matters he covered in his speech at the oldest
university in the Americas regarding the synergies that must be forged
among the State, the university, and businesses. High-quality public
education is the necessary catalyst to ensure prosperity for more
7
Peruvians and to guarantee a better future for our country. To achieve
this, it is essential for the State to guarantee the resources required by
the university and to ensure the quality of the education imparted there.
For their part, the university and the private sector must engage in direct
contact to help monitor the latest job requirements and technological
trends.
Responsible mining and its contribution to the development of Peru

offers a perfect summary of the underlying principle of the work done
by Compañía de Minas Buenaventura over the course of the last 65
years: engaging in mining activities guided by a tradition of optimism,
perseverance, respect for neighboring communities and their authorities,
and a commitment to Peru.
I would like to congratulate Roque Benavides on this new edition of

his book, and thank the fifteen thousand Buenaventura employees in
eight regions of Peru who make it possible for the company to engage in
modern mining, with a focus on shared social responsibility, helping to
integrate the country just as it was intended by the company’s founder,
Alberto Benavides de la Quintana.
Victor Gobitz
Lima, July 2018
8
Victor Gobitz is the General Manager of Buenaventura since January
2017. He has also served as Board Member of Sociedad Minera El Brocal
since that same year. Previously, he was CEO of Compañía Minera Milpo
from 2013 to 2016; General Manager and Board Member of Río Alto
Mining (now Tahoe Resources); General Manager and Board Member
of Castrovirreyna Compañía Minera; Operations Manager of Sociedad
Minera El Brocal; and Assistant General Manager and Board Member
of Volcan Compañía Minera. He is currently the director of Gerens
Business School and professor at the Pontifical Catholic University of
Peru (PUCP). He was also president of the Peruvian Institute of Mining
Engineers (IIMP). With over twenty-five years of experience in operations
management and mining projects, he is a graduate of the PUCP (1986)
and holds an MBA from ESAN School of Business (1998) and specialized
studies at Wharton School of the University of Pennsylvania (2005) and
Kellogg School of Management (2015).
9
INTRODUCTION
We firmly believe that responsible mining is a major factor in our country’s

development and growth. Despite this, the general public is often
uninformed in these matters, placing little value on these contributions
due to a lack of understanding.
As a country, we need to acknowledge our failure to properly

communicate the benefits of mining with force and conviction. This is
responsibility of the government, to be met through its institutions and
democratically elected officials, and there can be no denying that mining
companies, too, must play their part.
Of course, we are making progress in this process of communication

and dialogue with our communities and other mining stakeholders. This
undertaking is also quite helpful in ensuring the viability and continuity
of mining operations, guaranteeing that mining will contribute to the
country and our people.
As part of these efforts, we are proud to present the third edition,

updated and expanded, of Responsible mining and its contribution to the
development of Peru. This book seeks to raise awareness of the benefits
brought by mining, as a major source of jobs, a significant taxpayer,
and a tireless promoter of communities’ self-managed development,
caring for and preserving the environment, and especially water.
Mining is also a crucial contributor to infrastructure, including roads,
electricity, communications, and reservoirs, among others, thus driving
Peru’s decentralization as a fundamental component of sustainable
development.
10
That global vision of mining helps us to learn about and understand
how the world has evolved, and so, just like everything else, have
standards. There is no question that the environmental, safety, and social
responsibility standards of today are different than those of a hundred
years ago, posing challenges for us that we want to—and must—tackle.
Of those challenges, too, we talk in this book, and about how Compañía
de Minas Buenaventura, a Peruvian company founded in 1953, has spent
the last 65 years addressing them with humility and pride in what we do
for our country.
It should be noted that of all investment in Peru, 80 percent is private

and 20 percent public. And of that 80 percent of private investment, 80
percent comes from Peru and 20 percent from abroad. These statistics
are cause for great optimism, encouraging us to continue supporting
our country’s growth and development. However, there are also four
main problems faced by the country’s economy, namely corruption,
informality, centralism, and bureaucracy. It is our duty to continue
striving to eliminate these endemic ills. We are particularly concerned
about the new outbreak of populist movements like those that have done
so much harm in the past. Nevertheless, we remain optimistic, in the
belief that together, we can achieve our goals.
Peru meets all of the essential conditions for becoming a developed

country. To achieve this, we need to work together on the same team.
Our objective is to ensure that everyone has equal access to healthcare,
education, safety, and justice.
Roque Benavides
Lima, July 2018
11
1
OVERVIEW OF
THE MINING SECTOR
12
RESPONSIBLE MINING
and its contribution to the development of Peru
Panoramic view of
Orcopampa, Arequipa.
13
1
Overview of
the mining sector
Currently, mining is the backbone

of the Peruvian economy.
14
RESPONSIBLE MINING
1.1 MINING AND ITS ROLE IN THE PERUVIAN ECONOMY
Throughout history mining has been one of the most important activities in the development
of the Peruvian economy. However, its role has changed over time along with its importance.
In the pre-Incan era, for example, its function was entirely ornamental. Precious metals were
used by the political and religious elites, but were not utilized as part of the taxes paid to the
governments of the time.
Following the Spanish conquest, mining

became one of the great economic drivers of
the Viceroyalty. Between the 16th and 17th
Peru´s position in the world ranking of centuries, massive quantities of gold and
mineral reserves and production silver were amassed, serving as the source of
the Spanish Crown’s wealth. Mining activity
Percentage of Production
mineral reserves ranking later came to a halt, during the process of
emancipation, only to reemerge further on, after
GOLD 5% 6° the Republic of Peru was officially established.
SILVER 21% 1°
It is important to recall that Peru has
COPPER 11% 2° experienced hard times. For instance, between
1969, when Cuajone project was developed,
ZINC 13% 3° until 1993, when Yanacocha started up, there
were no mining projects at all, due to the
LEAD 8% 8°
political and economic instability that rocked
our country.
Source: USGS, 2017
Over the last 28 years, however, there have been

many projects that have bolstered the growth
of our mining production. Currently, mining is
the backbone of the Peruvian economy. Our
country has achieved a very important position
in world mining production, situating itself
among the top producers of gold, silver, copper,
zinc, and lead.
15
1
Overview of
the mining sector
This has been possible thanks to a number of strengths

and benefits enjoyed by our country. For instance, our
strategic location in South America allows us to do
business with countries in Asia and North America.
Our unique and diverse geology provides us with
enormous amounts of mineral resources, thanks to
our position in one of the most prolific polymetallic
belts in the world. In economic matters, we have
become increasingly open to foreign markets with
the signing of free trade agreements.
Peru’s political and economic stability is rooted in the

free trade agreements signed with 55 countries all
over the planet, representing two-thirds of the gross
world product; the achievement of an investment
grade credit rating; its membership in the Pacific
Alliance; and the absolute independence of the
Central Reserve Bank.
16
RESPONSIBLE MINING
17
1
Overview of
the mining sector
1.2 THE VIRTUOUS CIRCLE OF MINING
Peru’s significant levels of mining production have been achieved with

many years of hard work and dedication, thanks to a virtuous circle
that allows for the continuity of this activity, based on the phases of
exploration, discovery, development, and production. These steps need
to be followed within a framework of safety and responsibility toward
the environment, employees, and neighboring communities. It is also
essential to obtain all the necessary authorizations from the relevant
authorities.
Obviously, mining involves work with nonrenewable resources, which

means that the business’s continuity depends specifically on compliance
with this cycle, within which the exploration stage is especially important.
The future of mining and of the extractive industries in general, depends
on the exploration stage and technological innovation.
In mining, exploration is equivalent to the research and development

performed in the manufacturing industry. In other words, exploration
is everything that lies beneath the earth’s surface, about which much
remains to be learned. During this stage, the environmental impact
is quite limited and highly controlled. So much so that in Finland, for
example, where there are no mountains or outcroppings near the surface,
the government drills every two km to determine what is contained in
the subsoil.
According to the Fraser Institute Index, Peru is the second most important
destination for mining exploration in Latin America. In 2016 alone, our
country accounted for 6 percent of worldwide investment in exploration,
and is expected to reach 8 percent by 2021.
18
RESPONSIBLE MINING
Exploration
The future of mining and of

the extractive industries Discovery
Production
in general, depends on
the exploration stage and
technological innovation.
Development
19
1
Overview of
the mining sector
1.3 NATIONAL GDP AND MINING GDP
The oft-repeated criticism is that Peru’s economy is primary/export-

based, depending mainly on its natural resources, a situation that must
change if we want to achieve a harmonious development.
However, as the economist Juan José Garrido Koechlin explained

to El Comercio newspaper in an article published in March 2013, an
argument could be made that the Peruvian economy is a tertiary or
service economy, like many others in the world. This type of economy
is characterized by high levels of productivity, since this is what most
contributes to a nation’s Gross Domestic Product (GDP).
The GDP is simply the total value of goods and services produced in
one year in a country. This does not include goods produced by citizens
residing abroad, although it does take into account those produced by
foreigners living in the country. The growth of GDP brings economic
benefits, such as employment and greater economic vitality.
The Peruvian socioeconomic context 2017
Peru Lima Regions

GDP S/ 514,213 billion 45% 55%
Mining GDP and
S/ 67,340 billion 4% 97%
extractive industries
Population 31,8 million 32% 68%
Poverty 21,7% 15% 45% (3 times Lima)
Extreme proverty 3,8% 1.6% 6.5% (4 times Lima)
Source: INEI, 2017
20
RESPONSIBLE MINING
According to a study by the Ministry of Energy and Mines (Minem) mining

accounts for over 10 percent of our GDP, and over 60 percent of the value
of our country’s exports.
One clear example of this is the major impact that mining has on
Peru’s different regions. Out of a total GDP of S/ 514.213 billion, just
45 percent is generated in Lima, with the remaining 55 percent comes
from the regions. This demonstrates the positive impact that mining
has on decentralization, especially in the high Andean areas of Peru.
Furthermore, 96 percent of the mining GDP was generated in the regions.
Let us be frank: to say that mining contributes nothing is pure nonsense.
It is worthwhile to take a look at mining’s GDP percentage in other mining

countries such as Chile, Mexico, Canada, Australia, and South Africa,
among others, as we can see in the following table:
GDP growth and world mining GDP 2017
Country GDP growth Mining GDP

Peru 2.5% 9.8%
Chile 1.5% 9.9%
Canada 3.0% 24.03% (1)
Mexico 2.3% 5.8% (2)
Australia 2.4% 3.9%
South Africa 1.3% 7.2%
(1) Includes mining, oil and gas
(2) Information at the close of 2016

Source: Sunat, 2017
21
9.2% 5.2%
0.3%
13.0% Agriculture
GDP Fishing
by economic
Mining
sectors in Peru
13.3% Manufacture
Construction
Services
5.9% Taxes
53.2%
1.2%
15.7%
EAP
by economic Services
sectors in Peru Agriculture and fishing
39.5%
18.3% Commerce
Manufacture
Mining
25.3%
1.2% 0.4%
7.5%
16.3%
Taxes paid
by economic Agricultural
sectors in Peru 17.4% Fishing
Mining
8.2% Manufacture
Services
Construction
Commerce
49.0%
Source: INEI, 2017

RESPONSIBLE MINING
There can be no doubt that poverty is mainly to be found outside the

largest cities, especially in rural areas, in the jungle and the high Andes.
However, the National Institute of Statistics and Informatics (INEI)
reports that over the decade between 2007 and 2017, a total of 5,180,000
people rose out of poverty, with another 872,000 people doing so in the
five years between 2013 and 2017. Additionally, monetary poverty has
dropped by 20.7 percent over the last decade, and 4.1 percent in the last
five years. Such data fills us with optimism.
The mining sector has a major impact on the country’s macroeconomic

numbers, which also works through its links to other industries, such as
services, construction, and metalworking, among others. This effect is
clearly shown in mining’s contribution to the regional GDP, exports, and
the generation of hard currency earnings, along with tax revenues, which
play a vital role in Peru’s development.
23
1
Overview of
the mining sector
As we say in Peru, “the more skins, the more belts”, it is critical for the
Peruvian mining sector to continue growing within a framework of
safety, as well as social and environmental responsibility, working hand-
in-hand with the local authorities and the populations neighboring the
different projects and operations.
The mining sector in Peru 2017
10% of national GDP

18% of regional GDP (except Lima)
60% of national exports
20% of corporate tax contributions
40% of corporate income tax
3% purchases as part of national GDP
Source: INEI, 2017
24
RESPONSIBLE MINING
1.4 MINING PRODUCTION
Over the last decade, Peru’s production of gold, silver,

and copper has grown steadily, as we will see in the
next chapter (Mining regions of Peru). We must work
hard to make sure this growth continues by applying
the virtuous circle of mining.
Mining companies must contribute to this growth

by doing their job: exploring, discovering minerals,
establishing their potential, and deciding how to invest
as efficiently as possible, not only in economic terms,
but in social and environmental terms, as well.
The communities in the high Andes of Peru, where most

of the country’s mineral deposits are located, must
be well informed of the benefits that come with new
projects, thus enabling to provide support and work
together with mining companies and local authorities
to help residents get ahead while guaranteeing an
atmosphere of harmony and understanding. In the end,
we will all benefit from the development of our country
and its inhabitants.
The government, too, must do its part to speed up

administrative processes and create an investment-
friendly environment. Only then can mining activity
continue to make such significant contributions.
25
1
Overview of
the mining sector
1.5 MINING POTENTIAL
Peru possesses enormous mining potential in its high Andean areas,

where companies are engaged in large-scale projects. Our minerals are
in high demand in markets such as the United States, China, Switzerland,
Japan, and the European Union.
Peru in the world mining potential ranking
COPPER GOLD
Millions of MT Millions of ounces
TOTAL 720 100% TOTAL 1,772.9 100%
CHILE 210 29.2% AUSTRALIA 295.5 16.7%

AUSTRALIA 89 12.4% RUSSIA 248.8 14.0%
PERU 81 11.3% SOUTH AFRICA 186.6 10.5%
MEXICO 46 6.4% UNITED STATES 93.3 5.3%
UNITED STATES 35 4.9% INDONESIA 93.3 5.3%
RUSSIA 30 4.2% PERU 79.5 4.5%
CHINA 28 3.9% BRAZIL 74.6 4.2%
CONGO 20 2.8% CANADA 74.6 4.2%
ZAMBIA 20 2.8% CHINA 62.2 3.5%
CANADA 11 1.5% UZBEKISTAN 52.9 3.0%
OTHERS 150 20.8% OTHERS 511.5 28.8%
SILVER ZINC
Millions of ounces Millions of MT
TOTAL 17,729 100% TOTAL 226.3 100%
PERU 3,284 18.5% AUSTRALIA 63.0 27.8%

AUSTRALIA 2,768 15.6% CHINA 40.0 17.7%
POLAND 2,644 14.9% PERU 28.5 12.6%
CHILE 2,395 13.5% MEXICO 17.0 7.5%
CHINA 1,213 6.8% UNITED STATES 11.0 4.9%
MEXICO 1,151 6.5% KAZAKHSTAN 11.0 4.9%
UNITED STATES 778 4.4% INDIA 10.0 4.4%
BOLIVIA 684 3.9% CANADA 5.7 2.5%
RUSSIA 622 3.5% BOLIVIA 4.0 1.8%
OTHERS 2,188 12.3% SWEDEN 3.0 1.3%
OTHERS 33.1 14.6%
26
RESPONSIBLE MINING
LEAD MOLYBDENUM
Thousands of MT Thousands of MT
TOTAL 88,000 100% TOTAL 16.658 100%
AUSTRALIA 35,000 39.8% CHINA 8,400 50.4%

CHINA 17,000 19.3% UNITED STATES 2,700 16.2%
RUSSIA 6,400 7.3% PERU 2,185 13.1%
PERU 6,053 6.9% CHILE 1,800 10.8%
MEXICO 5,600 6.4% CANADA 260 1.6%
UNITED STATES 5,000 5.7% RUSSIA 250 1.5%
INDIA 2,200 2.5% AUSTRALIA 190 1.1%
KAZAKHSTAN 2,000 2.3% MONGOLIA 160 1.0%
BOLIVIA 1,600 1.8% KAZAKHSTAN 150 0.9%
POLAND 1,600 1.8% SWEDEN 130 0.8%
OTHERS 5,547 6.3% OTHERS 433 2.6%
Source: Minem, 2017
27
1
Overview of
the mining sector
Peru’s total area measures 128

million hectares, of which 12.8
percent has been granted in
concession for mining. Just 1.28
percent is allocated for mining
exploration and exploitation. If we
use our resources responsibly, we
will be able to continue eradicating
poverty in the high Andean areas
where mining is performed.
We must take advantage of all

this potential. As we will see in
the next chapter, we have an
immense number of projects and
investments, totaling over US$
58.346 billion in the coming years.
This is the key to the future of
mining and its continued positive
impact on the Peruvian economy.
12.8% LAND UNDER MINING CONCESSIONS

16´441,000 ha
1.28% LAND UNDERGOING EXPLORATION

AND MINING ACTIVITIES
1´650,000 ha
604 MINING OPERATIONS 1´261,494 ha 0.98%

332 EXPLORATION PROJECTS 389,249 ha 0.30%
Source: Minem, 2017
28
Map of
mining projects
TUMBES
LORETO
AMAZONAS
PIURA
LAMBAYEQUE
CAJAMARCA
SAN MARTÍN
LA LIBERTAD
ÁNCASH
HUÁNUCO
UCAYALI
PASCO
JUNÍN
LIMA
MADRE DE DIOS
CUSCO
HUANCAVELICA
APURÍMAC
ICA
AYACUCHO
PUNO
LEGEND
MAIN PROJECTS IN PORTFOLIO
AREQUIPA
ADVANCED PHASE
OF EXPLORATION
MOQUEGUA
EARLY PHASE OF EXPLORATION
TACNA
Source: Minem, 2017
29
1
Overview of
the mining sector
1.6 ILLEGAL MINING
As we have seen, our minerals are in high demand in the international

market. However, part of Peru’s production comes from informal and
illegal mining activities that have begun to expand throughout the
country in recent years.
The National Association of Mining, Petroleum, and Energy (SNMPE)

reports that illegal mining in Peru generates revenues of nearly US$ 1
billion per year. The people responsible for this production pay no taxes
or royalties, and they create no benefits for the regions where they
operate. Quite the contrary, they bring pollution, human trafficking,
and other negative consequences for society, the economy, and the
environment. There are more than 100,000 Peruvians involved in these
activities, which are primarily concentrated in Madre de Dios, Piura, Puno,
Arequipa, and Nazca.
While steps have been taken to promote formalization and eradicate

illegal mining, such efforts have proven insufficient. We must start by
understanding the difference between informal and illegal. Illegal mining
takes place in areas where mining operations are prohibited, such as
natural protected areas, rivers, and lakes. Informal mining, on the other
hand, involves operations that have not obtained operating permits in
areas where mining activity is allowed, meaning that such parties can and
should take the necessary steps to formalize their activities in accordance
with law.
Now that we have cleared up the concepts, let us raise a question: What
are the key aspects to be considered if we need to successfully address
the problem of informal and illegal mining?
30
RESPONSIBLE MINING
At the broadest level, the State must work

consistently, in coordination with all actors involved,
including regional and local governments. This will
give it a greater presence and penetration in the areas
where such activities are performed outside the law.
Any actions taken by the State must be firm and clear,
established within a framework of legal certainty and,
of course, occupational health and safety.
It is important to create expectations of growth

to help motivate small-scale and artisanal miners
to formalize their operations, providing access to
financing and advisory services on matters such as
responsible environmental management, among
other facilities. These tools are necessary to turn
formalization into a synonym of progress and growth.
It is also important to apply market mechanisms, such
as oversight of the chemical inputs and petroleum
used in this type of mining.
This is the great challenge faced by the State: to take

up the role of facilitator in promoting formalization;
and to exert its authority in fighting illegality. We
should recall here that formal operations give the
market confidence. Formalization provides legal
backing, helps trace a path toward economic and
social development, and increases the quality of life
of the local population.
For the benefit of both the formal mining sector

and the economy as a whole, the informal sector
must be formalized based on economic, social, and
environmental criteria, as well as reputational factors.
31
2
MINING REGIONS
OF PERU
32
RESPONSIBLE MINING
Huaraucaca processing
plant, El Brocal, Pasco.
33
2
Mining
regions of Peru
Peru is a mining country par excellence. As such, it is important to learn

about the major potential possessed by its regions and the positive
impact that this economic activity has on the country’s development.
Mining production by departments

(as a percentage of the departmental GDP)
70 61 61
60
49
48 47
38 37
29 29
23
21
16
14
12 11 11
9 10 9
6
3
2 1
Source: INEI, 2016
34
Main metals production 2017
Gold production 2008-2017 (MT) GOLD
184
180
164 166 162

156
153 151
147
148
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Gold production by region (MT)
Cajamarca (32.9) Madre de Dios (12.8)

22% 8%
La Libertad (42.9) Cusco (4.4)

28% 3%
Ancash (3.8) Puno (10.6)

3% 7%
Ayacucho (11.5)
8%
Otros (10.2)
Arequipa (21.9) 7%
15%
Total 151.1
Leading gold
producing 11.0%
companies 10.5%
Yanacocha
5.3% Barrick
Horizonte
Poderosa
5.2%
Buenaventura
58.8% Retamas
5.1%
Others
Others
4.2%
SILVER
Silver production 2008-2017 (thousand MT)

4.4
4.3
4.1
3.9
3.7 3.7 3.8

3.6 3.5
3.4
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Silver production by region (MT)
Ancash (781)
18%
Junin (802)
Pasco (602) 19%
14%
Lima (794) Huancavelica (130)

18% 3%
Ayacucho (431)
10%
Ica (119)
3%
Others (387)
Arequipa (258) 9%
6%
Total 4,304
Leading silver 16.8%

producing
companies
Buenaventura
Antamina
38.0% Volcan
15.0%
Ares
Chinalco
Casapalca
Others
11.6%
3.3%
3.8%
11.5%
COPPER
Copper production 2008-2017 (million MT)
2.45
2.35 2.35
1.70
1.38
1.28 1.30
1.27 1.25 1.24
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Copper production by region (MT)
Pasco (58.137)
2%
Cusco (328.275)
13%
Ancash (447.232)
18%
Arequipa (503.278)
21%
Lima (31.532)
1%
Moquegua (161.119)
Junin (214.971) 7%
9%
Tacna (145.035)
Ica (50.317) 6%
2%
Others (52.740)
Apurimac (452.950) 2%
19%
Total 2,445.585
Leading copper
producing companies
9.1%
20.5%
5.0% Cerro Verde
Las Bambas
8.0%
Antamina
Southern
8.4% 5.2%
Antapaccay
5.1% Chinalco
Hudbay
12.5% Others
18.0%
ZINC
Zinc production 2008-2017 (million MT)
1.60
1.51
1.47 1.47
1.42
1.35 1.34
1.32
1.26 1.28
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Zinc production by region (MT)
Ancash (497.639) Ica (163.215)

34% 11%
Huánuco (54.089) Ayacucho (46.908)

4% 3%
Pasco (242.306) Arequipa (29.869)

16%
2%
Lima (136.836)
9%
Others (11.831)
1%
Junin (290.343)
20%
Total 1,473.037
Leading zinc
producing companies 30.0%
30.4%
Antamina
Volcan
Milpo
3.3% Raura
El Brocal
3.6%
11.1% Milpo Andina
3.7% Others
17.9%
LEAD
Lead production 2008-2017 (thousand MT)
345
316 314
307
302
279
266
262
249
230
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Lead production by region (MT)
Ancash (39.368)
13% Ica (17.058)
6%
Huanuco (21.387)
7% Ayacucho (4.479)
1%
Pasco (94.886)
31% Arequipa (20.090)
7%
Lima (53.432)
17%
Junin (43.079)
14%
Others (2,243)
Huancavelica (10.771) 1%
4%
Total 306,794
Leading lead 17.6%

producing companies Volcan
Buenaventura
42.8% 8.3% El Brocal
Raura
7.8% Antamina
Milpo
Milpo Andina
7.0%
Others
5.4% 5.6%
5.6%
Source: Minem, 2018

2
Mining
regions of Peru
In recent decades, the regions of Peru have played a leading role in the great expansion of
mining activities. In the early 1990s, a hub of mining growth began to emerge in the north
of the country, mainly in Cajamarca, with the commissioning of Yanacocha; as well as in
Ancash, with the start of operations at Antamina and Pierina. As a result, the northern
part of Peru began to attract more attention than other regions with a long history of
mining, such as Arequipa, Huancavelica, and Pasco, among others. In this chapter, we will
take a brief look at the profile of each one of Peru’s mining regions, learning about which
companies operate there and their main portfolio projects, based on information from
the Minem.
2.1 CERRO DE PASCO
We will start this chapter with our beloved Cerro de Pasco, known as the mining capital of
Peru thanks to its age-old mining tradition dating back to the Viceroyalty of Peru.
Cerro de Pasco is a truly special case. This region became famous in Europe due to its precious
metal production. In 1572, the city of Cerro de Pasco was founded as Villa de Pasco. In 1639,
following a shipment of five million ducats from the mining settlement of San Esteban de
Yauricocha, it was granted the title of “Royal City of Mines.”
In fact, the first edition of this book, published in 2012, was presented in November of that
year on the campus of the Mining Engineering School of Daniel Alcides Carrión National
University (UNDAC) in Cerro de Pasco, as part of the ceremony in which I had the honor of
being named Doctor Honoris Causa by said university.
It was an emotional presentation for me, given its symbolic resonance. Not only was Cerro
de Pasco the historical epicenter of mining activity in Peru, but my father, Alberto Benavides
de la Quintana, began his career at the Cerro de Pasco Corporation, starting down the long
path that we continue to walk today at Compañía de Minas Buenaventura. We will be talking
about our company in greater detail in chapter four.
40
RESPONSIBLE MINING
There can be no question that mining in Cerro de Pasco has kick-started the local economy,
creating jobs and a higher demand for goods and services. Today, mining is the most
important activity in this region, which is one of the most productive in the country. Its zinc,
copper, lead, gold, and silver production is characterized by high grades and high volumes.
The mining companies currently operating in this region include El Brocal, a subsidiary of
Buenaventura; and Milpo. There are also six exploration projects underway.
Topic Company Project Region Mineral

Exploration project II Tinka Resources S.A.C. Ay Awilca Pasco Zn
Exploration project II Tinka Resources S.A.C. Colquipucro Pasco Ag, Zn, Sn
Compañía de Minas
Exploration project I Jancapata Pasco Ag, Pb, Zn
Buenaventura S.A.A
Portfolio of mining Compañía Minera Quicay II Pasco Au, Au
projects Centauro S.A.C
Exploration project I Minera Aurifera Toruna S.A.C Toruna Pasco Au
Compañía de Minas
Exploration project II Yumpaq Pasco Ag, Mn
Buenaventura S.A.A
2Mining
regions of Peru
2.2 ANCASH
Like Cerro de Pasco, Ancash boasts a significant mining potential, which is

mainly concentrated in the provinces of Huari and Huaraz. This translates
to formal employment for local residents, as well as the alternative
economic activities that are promoted by the presence of mining.
This region ranks second in Peru in copper production, surpassed only

by Arequipa. In 2016, copper production in Ancash totaled 454,400 MT
accounting for nearly 20 percent of the national production of this metal.
Many major mining companies operate in Ancash, including Barrick,

which owns the Pierina mine, as well as Antamina, one of the largest
copper operations in the world. Milpo is also present, working to develop
its polymetallic Hilarión project. According to the Minem, there are a total
of 20 mining projects in this region.
Exploration project I Oban S.A.C. Antamayo Ancash Cu
Exploration project II Compañía Minera Santa Luisa S.A. Atalaya Ancash Polymetallic Ag
Exploration project I Minera Quilca S.A.C. Berlín Ancash Cu, Pb, Zn
Exploration project I Reliant Ventures S.A.C Binita Ancash Cu, Au
Exploration project I Bear Creek Mining Company - Sucursal del Perú Carito Ancash Au, Cu
Exploration project I Mitsui Mining & Smelting CO.LTD. Sucurlsal del Pe Cóndor Ancash Au
Exploration project I Coppernico Exploraciones S.A.C Coppernico Ancash Cu
Exploration project I Anglo American Perú S.A.C Corcapunta Ancash Metallic
Exploration project II Minera Aguila de Oro S.A.C El Águila Ancash Cu, Mo
Exploration project I Lundin Mining Perú S.A.C Elida Ancash Metallic
Exploration project I Compañía Minera Milpo S.A.A. Guadalupe Ancash Metallic
Portfolio of mining projects Compañía Minera Milpo S.A.A. Hilarión Ancash Zn
Portfolio of mining projects Compañía Minera Milpo S.A.A. Magistral Ancash Cu
Exploration project II Lumina Copper S.A.C Pashpap Ancash Cu, Mo
Exploration project I Minera Peñoles de Perú S.A. Pucajirca Ancash -
Exploration project II Minera Peñoles de Perú S.A. Racaycocha Ancash Cu, Au, Mo
Portfolio of mining projects Reliant Ventures S.A.C San Luis Ancash Au y Ag
Exploration project I Minera Peñoles de Perú S.A. Santa Cruz Ancash Cu, Au, Mo
Exploration project I Condor Exploration Perú S.A.C. Soledad Ancash Au, Ag, Cu
Exploration project II SMC Toropunto LTD Sucursal del Perú Toropunto Ancash Cu, Ag, Zn
2
Mining
regions of Peru
2.3 CUSCO
The region of Cusco ranks fourth in gold production and fifth in copper
production in Peru. According to the Minem, there are ten projects in
exploration and four mining units in operation in the region.
Mining activity has clearly played a significant role in this region’s

economy ever since the Tintaya mine entered into operation in the 1980s.
The growth forecast for Cusco is also positive, given the series of new
projects that will start production in the coming years.
It is worth noting that over 70 percent of local jobs in Cusco are tied to the
mining sector, according to a recent study by the Minem.
Companies located in this region include Anabi, Constancia, Hudbay, and

Antapaccay, among others.

Portfolio of mining projects Exploraciones Collasuyo S.A.C. Accha Cusco Zn, Pb
Exploration project I Exploraciones Collasuyo S.A.C. Alcatraz Sur Cusco Zn, Pb
Exploration project II Minera Strait Gold Perú S.A.C. Alicia Cusco Cu
Exploration project I Minera Focus S.A.C. Aurora Cusco Cu, Mo, Au
Exploration project I Brexia Gold Plata Perú S.A.C. Condoroma Cusco Cu, Au
Exploration project II Compañía Minera Antapaccay S.A. Coroccohuayco Cusco Cu
Portfolio of mining projects Compañía Minera Ares S.A. Crespo Cusco Au, Ag
Portfolio of mining projects Compañía Minera Quechua S.A. Quechua Cusco Cu
Exploration project II Exploraciones Collasuyo S.A.C. Yanque - Dolores Cusco Zn Pb
RESPONSIBLE MINING
2.4 MOQUEGUA
Moquegua also possesses great mining potential. Its significant portfolio

of projects will help elevate the national production of copper, gold,
and silver in the coming years. For instance, we have the Quellaveco
project, owned by Anglo American; and San Gabriel (formerly known as
Chucapaca) owned by Compañía de Minas Buenaventura.
Both companies have worked to create a space for dialogue, openness,

and understanding with both the government and local communities.
In 2016, the Buenaventura’s San Gabriel project successfully held the

first Quechua-language public hearing in the history of Peru for the
presentation of an environmental impact assessment. Following this
milestone, it has become a prerequisite for public hearings to be held in
the local language.
Companies currently operating in Moquegua include Southern Peru (Ilo

and Cuajone), Aruntani, etc.

Exploration project II Fresnillo Perú S.A.C. Amata Moquegua Au
Exploration project I CompañÍa Minera Zahena S.A.C. Cardonal Moquegua Au, Cu
Exploration project II Compañía de Minas Buenaventura S.A.A. Colquemayo Moquegua Au
Exploration project I Golden Ideal Gold Mining S.A.C. Conymecar Moquegua Au
Exploration project I Compañía Minera Zahenia S.A.C. Ilo Norte Moquegua Cu, Au, Mo
Portfolio of mining projects Minera Hampton Perú S.A.C. Los Calatos Moquegua Cu-Mo
Exploration project I Compañía Minera Zahena S.A.C. Maloo Moquegua Metallic
Exploration project I Anglo American Quellaveco S.A. Pedregal Moquegua Cu
Exploration project I Maxy Gold Perú S.A. Picha Moquegua Cu
Exploration project I Anglo American Perú S.A. Pinco - Pinco Moquegua Cu
Exploration project I Anglo American Quellaveco S.A. Puca Urkku Moquegua Cu
Portfolio of mining projects Anglo American Quellaveco S.A. Quellaveco Moquegua Cu
Exploration project I Anglo American Perú S.A. Quinsacollo Moquegua Cu
Exploration project I Minera Antares Perú S.A. Rosa Roja Moquegua Cu
Exploration project I Minera Anaconda Perú S.A. Sami Moquegua Au, Cu
Portfolio of mining projects Compañía de Minas Buenaventura S.A.A. San Gabriel Moquegua Au
(Ex - Chucapaca)
Exploration project II Bear Creek Mining Company - Sucursal del Perú Tassa Moquegua Ag, Au
02
Mining
regions of Peru
2.5 APURIMAC
In Apurimac, copper is king. This region has become the third largest
copper producer in the country, behind Arequipa and Ancash. There are
over 20 projects in portfolio in the region.
The origin of the name “Apurimac” is an interesting one. In Quechua,

“Apu” means “mountain,” while “rimac” means “speaking” or “speaker.”
Thus, Apurimac is a mountain that speaks to us, telling us much about its
major mining potential.
Apurimac is the site of Las Bambas copper mine, located in the provinces
of Cotabambas and Grau. The mine began operating in November 2015.
In this region, Buenaventura owns Trapiche project, which will eventually
become an open-pit copper operation in the district of Juan Espinoza
Medrano, province of Antabamba.
Apurimac has become a success story thanks to mining, which has helped
it to transition from one of Peru’s poorest departments to one of the
departments with the highest growth rates in the country. In the first
quarter of 2017, Apurimac reported the highest growth in the country,
at 86.1 percent.
The reason behind this growth is the commissioning and start of copper
extraction at the Las Bambas mining project, which has created direct
employment and integrated a number of sectors into its production
chain, including transportation, communications, and general services.
46
Exploration project I Águila American Resources Limited S.A. Angostura Apurimac Au, Ag
Exploration project I Verde Resources S.A.C. Antabamba Apurimac Cu
Exploration project II Panoro Apurimac S.A. Antilla Apurimac Cu, Mo
Portfolio of mining projects Anabi S.A.C. Anubia Apurimac Cu
Exploration project II Compañía Minera Ares S.A.C Azuca Apurimac Au, Ag
Exploration project I Anthony Minning S.A.C. Chacapampa Apurimac Cu, Zn, Pb
Exploration project II Alturas Minerales S.A. Chapi Chapi Apurimac Cu, Au
Portfolio of mining projects ProInversión Colca Apurimac Au, Cu
Exploration project I Super Strong Mining S.A.C. Corivale Apurimac Metallic
Portfolio of mining projects Panoro Apurimac S.A. Cotabambas Apurimac Cu, Au, Ag
Exploration project I Exploraciones Collasuyo S.A.C. Gema Apurimac Cu, Zn, Pb
Portfolio of mining projects Minera Antares Perú S.A.C. Haquira Apurimac Cu, Mo
Exploration project II Ferrobamba Iron S.A. Hierro - Aymares Apurimac Fe
Portfolio of mining projects Apurímac Ferrum S.A. Hierro Apurimac Apurimac Fe
Portfolio of mining projects ProInversión Jalaoca Apurimac Cu, Mo
Exploration project I Bear Creek Mining Company – Sucursal del Perú La Yegua Apurimac Cu, Au, Mo
Portfolio of mining projects Southern Peru Cooper Corporation Sucursal del Perú Los Chancas Apurimac Cu
Exploration project II Consorcio Minero Horizonte S.A. Millo Apurimac Au, Zn
Exploration project I Minera Barrick Misquichilca S.A. Misha Apurimac Au
Exploration project I Consorcio Minero Horizonte S.A. Pachaconas Apurimac Au, Cu
Exploration project I Minera Barrick Misquichilca S.A. Promesa Apurimac Cu, Au
Portfolio of mining projects El Molle Verde S.A.C. Trapiche Apurimac Cu, Mo, Ag
Exploration project II Compañía Tumipampa S.A.C. Tumipampa Apurimac Au
02
Mining
regions of Peru
2.6 CAJAMARCA
Cajamarca is also a major mining region. Its gold production has ranked
among the highest in the country since the 1990s. Companies currently
operating in Cajamarca include Yanacocha, Gold Fields, Compañía Minera
Coimolache, Minera La Zanja, and others.
Similar to Apurimac, Cajamarca is home to 47 percent of Peru’s mining

project portfolio, worth an estimated US$ 27.562 billion, according to the
Lima Chamber of Commerce. It also has high rates of monetary poverty;
however, along with social conflicts that represent complications for new
investments.
This region is home to ten projects, mainly involving copper. These

include La Granja (US$ 5 billion) Michiquillay (US$ 2.5 billion) Ampliación
Shahuindo Fase II (US$ 109 million) and Quecher Main (US$ 300 million).
Unfortunately, radical anti-mining groups have stymied the region’s

economic development in recent years. According to the IPE, economic
activity in Cajamarca shrank by 5.6 percent during the third quarter of
2016 (following a drop of 3.3 percent in the second quarter) as a result of
the decrease in the gross value of mining (-20.8 percent) and agriculture
(-3.8 percent) and a sustained rise in unemployment levels. Consequently,
the poverty rate remained nearly the same from 2010 to 2015, lowering
slightly from 48.41 percent to 44.95 percent, meaning that Cajamarca
continues to be one of the poorest departments in Peru.
Cajamarca’s enormous mining potential is not being used to full effect.

To see the difference, we need only look to the success story in Apurimac
(see page 46). As we can see, the departments of Cajamarca and
Apurimac have similar opportunities, but with very different results thus
48
RESPONSIBLE MINING
far. While Apurimac has decided to support responsible mining as a driver

of growth, within a framework of harmonious coexistence with agricultural
and livestock activities, Cajamarca continues to experience economic
stagnation as a result of halted mining projects.
We remain optimistic, however, that this situation can and will change.
The presence of such important mining projects as Michiquillay (recently
awarded to Southern Peru) Conga, Galeno, La Granja, and more have the
potential to bring major benefits for this region, such as roads, electricity
generation projects, water infrastructure, public works, health, and
education.

Exploration project II Minera La Zanja S.R.L. Castrejón Cajamarca Cu, Au, Ag
Exploration project II Minera Yanacocha S.R.L. Colorado Cajamarca Au
Exploration project II Wild Acre Metals (Perú) S.A.C. Colpayoc Cajamarca Au, Cu, Ag
Portfolio of mining projects Lumina Cooper S.A.C. Galeno Cajamarca Cu, Mo, Au, Ag
Portfolio of mining projects Río Tinto Minera Perú Limitada S.A.C. La Granja Cajamarca Cu
Portfolio of mining projects ProInversión Michiquillay Cajamarca Cu
Portfolio of mining projects Minera Yanacocha S.R.L. Minas Conga Cajamarca Cu, Au
Exploration project I Origen Group S.A.C Pampa Colorada Cajamarca Au
Exploration project I Minera La Zanja S.R.L. Totora Cajamarca Au
Exploration project I Exploraciones Aguila Dorada S.A.C. Yagku Entsa Cajamarca Au, Ag
2
Mining
regions of Peru
2.7 TACNA
Tacna occupies an important position in Peru’s copper and molybdenum

production. This region is particularly notable for the Toquepala mine,
operated by Southern Peru; and the Pucamarca mine, operated by
Minsur. The latter mine extracts gold from mount Checocollo, located in
the high Andes near the border with Chile.
This region has seven mining projects in the provinces of Tacna, Tarata,
and Candarave, most of which will produce copper.

Exploration project I Comáñía Mira Zahena S.A.C. Ataspaca Tacna Cu, Zn
Exploration project I Anglo American Peru S.A. Chipispaya Tacna Au, Cu
Exploration project I Minera Peñoles Perú S.A. Minaspampa Tacna Cu
Exploration project I Bhp Billiton World Exploration Inc. Sucursal Del Perú Pampa M Tacna Cu
Exploration project I Wild Acre Metals (Perú) S.A.C Sambalay Tacna Au, Ag, Cu
Exploration project I Rio Tinto Mining And Exploration S.A.C. Suyawi (camilaca) Tacna Cu, Mo
Exploration project I Junefield Group S.A. Vale Tacna Fe, Cu, Au
RESPONSIBLE MINING
2.8 AYACUCHO
Mining has become quite an attractive economic activity in Ayacucho

thanks to its gold, zinc, copper, lead, and silver reserves.
According to the Ministry of Energy and Mines (Minem) there are 13

proyects currently in the exploration stage in Ayacucho, including Pisaccalla
(polymetallic) and Titiminas (zinc, lead, and silver) both property of Compañía
de Minas Buenaventura.
AlsoactiveinthisregionareCatalinaHuancaandNewmont,amongothercompanies.

Exploration project II Apumayo S.A.C. Ayahuanca Ayacucho Au, Ag
Exploration project I Zamin Perú Gold S.A.C. Ccorisayhua Ayacucho Au
Exploration project I Compañía Minera Ares S.A.C. Fresia Ayacucho Au
Exploration project I Compañía Exploraciones Orion S.A.C. Huiniccasa 2013 Ayacucho Cu, Zn, Ag, Mo, Fe
Exploration project I Laconia South America S.A.C. Kimsa orcco Ayacucho Cu
Exploration project II Minas Dixon S.A. Lara Ayacucho Cu, Mo
Exploration project I Compañía Minera Milpo S.A.A. Mónica Lourdes Ayacucho Fe, Cu, Au
Exploration project I Minera Azola S.A.C. Palla palla Ayacucho Cu, Zn
Exploration project II Fresnillo Perú S.A.C. Pilarica Ayacucho Au, Cu
Exploration project I Compañía de Minas Buenaventura S.A.A. Pisaccalla Ayacucho Cu
Exploration project I Compañía Minera Zahera S.A.C. Sami Ayacucho Cu
Exploration project II Santa Barbara Resources Peru S.A.C. Sancos Ayacucho Au, Ag, Cu
Exploration project II Compañía de Minas Buenaventura S.A.A. Tititminas Ayacucho Cu, Mo
2
Mining
regions of Peru
2.9 JUNIN
Junin is also a predominantly mining region. For over 150 years, this area
of Peru has been a major producer of zinc, above all, along with other
metals such as lead, copper, gold, and silver.
Mining companies active in this part of the country include Chinalco,

Casapalca, Argentum, and Doe Run. Junin is also the site of one of Peru’s
most important mining undertakings: Toromocho. This mine, operated by
Chinalco, produces enough copper and molybdenum to triple the region’s
canon. The project began operating in 2017.
The Toromocho Plant currently has a capacity of 117.200 tons per day.
With its expansion plans, recently approved by the Minem, it will soon
process 170.000 tons per day.

Portfolio of mining projects Ariana Operaciones Minera S.A.C. Ariana Junín Polymetallic
Exploration project II Samco Minera S.A. Dino Junín Zn, Pb, Ag
Portfolio of mining projects Mantaro Perú S.A. Fosfatos Mantaro Junín Phosphates
Exploration project I Fresnillo Perú S.A.C. Huacravilca Junín Ag
Exploration project II Submicon S.A.C. San Antonio Junín Au, Cu
Portfolio of mining projects Votorantim Metais Cajamarquilla S.A. Shalipayco Junín Zn, Pb, Ag
Exploration project I Exploraciones Mineras San Ramón S.A. Tarmatambo Junín Metallic
Exploration project I Teck Perú S.A. Tucumachay Junín Au, Zn
RESPONSIBLE MINING
2.10 HUANCAVELICA
The riches of Huancavelica’s silver and mercury deposits were

common knowledge even before the arrival of the Spaniards. The city
of Huancavelica was founded in the 17th century thanks to the large
quantities of mercury being extracted from the Santa Bárbara mine. Back
then; this mineral was used to treat the silver extracted from deposits
such as Potosí and Castrovirreyna.
Mercury was used to obtain silver through a process of amalgamation

with those minerals that were not profitable in traditional extraction
procedures. Thus the particular importance of these deposits. Today,
Huancavelica also has significant reserves of copper, gold, lead, zinc, and
silver.
Huancavelica is very important to Buenaventura. In 1953, our history

began with Julcani mine in this region (see 4.1. Our beginnings). Julcani
is a silver mine located in the province of Angaraes, which continues to
operate to this day.

Exploration project I Braeval S.A.C. Arcopunco Huancavelica Cu, Mo, Au, Ag
Exploration project II Minera Irl S.A. Bethana Huancavelica Au, Cu
Exploration project II Compañía Minera Caravelí S.A.C. Cahuiña Huancavelica Metallic
Exploration project II Estrella Gold Perú S.A.C. Estrella Huancavelica Au, Ag
Exploration project II Alturas Minerales S.A. Huajoto Huancavelica Zn, Au, Cu
Exploration project I Sumitomo Metal Mining Peru S.A. Incasol Capillas Huancavelica Metallic
Exploration project I Compañía Minera Milpo S.A.A. Josjo Huancavelica Au, Ag
Exploration project I Consorcio Minero Palcawanka S.A.C. Palcawanka Huancavelica Metallic
Portfolio of mining projects Compañía Minera Milpo S.A.A. Pukaqaqa Huancavelica Cu, Mo
Exploration project I Bear Creek Mining Company – Sucursal del Perú Sumi Huancavelica Au
Exploration project II Sociedad Minera El Brocal S.A.A. Yanamina Huancavelica Au
2
Mining
regions of Peru
2.11 AREQUIPA
This region is an important mining destination. During colonial times,

when the silver mines at Potosí were still active, this region of Peru
became a major logistical hub within the south Andean mining circuit.
Today, its large-scale mining production makes it one of the main mineral-
supplying regions in southern Peru. Arequipa produces large quantities
of copper, as well as gold, zinc, lead, and silver. Following the expansion
of the Cerro Verde Mine, the region has become the number one producer
of copper, with 524,000 MT in 2016, accounting for 22.3 percent of all
national copper production during that period.
Mining companies operating in Arequipa include Cerro Verde, which

has the world’s largest copper concentrating plant there, as well as
Buenaventura, which operates the Orcopampa and Tambomayo units.

Exploration project I Junefield Group S.A. Acari Arequipa Fe
Exploration project I Golden Ideal Gold Mining S.A.C. Arequipa 3 Arequipa Fe
Exploration project I Golden Ideal Gold Mining S.A.C. Atico Arequipa Fe
Exploration project I Wild Acre Metals (Peru) S.A.C Chaparra Arequipa Metallic
Exploration project I Camino Resources S.A.C. Chapito Arequipa Cu
Portfolio of mining projects Junefield Group S.A. Don javier Arequipa Cu
Exploration project I Questdor S.A.C. Lana Arequipa Prospectus
Exploration project I Teck Perú S.A. Marcahui Arequipa Cu, Mo
Exploration project II Compañía de Minas Buenaventura S.A.A. Mayra Arequipa Metallic
Exploration project II Inversiones Minerales S.A.C. Ocaña Arequipa Cu
Portfolio of mining projects Jinzhao Mining Peru S.A. Pampa de Pongo Arequipa Fe
Exploration project II Pembrook Copper S.A.C Pecoy Arequipa Cu, Mo, Au, Ag
Exploration project II Compañía de Minas Buenaventura S.A.A. Pucay Arequipa Au, Ag
Exploration project II Consorcio Minero Horizonte S.A. Romerillo Arequipa Au, Cu
Portfolio of mining projects Southern Peru Cooper Corporation Sucursal Perú Tía María Arequipa Cu
Exploration project I Torion Mining S.A.C. Tororume uno Arequipa Cu, Mo, Au
Exploration project I Consorcio Minero Horizonte S.A. Valetita Arequipa Au
Exploration project I Minera Pampa de Yaras S.A.C. Yaramaba Arequipa Prospectus
Exploration project II Stiles Donald Le Roy Yebachas Arequipa Prospectus
Exploration project I Golden Ideal Gold Mining S.A.C. Yuquibamba Arequipa Fe
Portfolio of mining projects Minera Aqm Copper Peru S.A.C. Zafranal Arequipa Cu, Au
2
Mining
regions of Peru
2.12 LA LIBERTAD
Mining is a pillar of the economy in the highlands of La Libertad,

especially in Otuzco and Santiago de Chuco, where the companies
Barrick Misquichilca (Alto Chicama) and Pan American Silver (Quiruvilca)
are active. Other companies operating in La Libertad include Compañía
Minera Poderosa, Consorcio Minero Horizonte, Minera Aurífera Retamas,
and more.
The region’s mining portfolio is valued at over US$ 430 million, according
to the Minem. This amount includes projects in the exploration stage (US$
2.8 million, which represents 1.3 percent of all exploration investments)
and in portfolio, which total US$ 431 million.
Among projects in exploration, special note should be made of Virú,

property of Core Minerales, with an estimated investment of US$
800,000. As for projects in portfolio, there are three major ones in La
Libertad: the optimization of processes at Lagunas Norte (for US$ 185
million, operated by Minera Barrick Misquichilca); the expansion of La
Arena (Phases I and II) which will cost US$ 130 million; and the expansion
of the Santa María Plant to 1,000 MT/day, operated by Minera Poderosa
(estimated investment of US$ 116 million).

Exploration project I Minera Sunser Del Perú S.A.C. Carolay La Libertad Ag
Exploration project I Sociedad Minera Trinity Perú S.A.C. Caupar La Libertad Au, Ag
Exploration project II Peruvian Latin Resources S.A.C. Guadalupitigoro La Libertad Fe, Andalucite
Exploration project II Proyectos La Patagonia S.A.C. Igor La Libertad Au, Ag
Exploration project I Compañía Minera Ares S.A.C. Julieta La Libertad Au
Exploration project I Vale Exploration Peru S.A.C. Pachagón La Libertad Au
Exploration project I Moche Gold S.A.C. Paja blanca La Libertad Au
Exploration project I United Miners Working S.A.C. Shonita La Libertad Au, Cu
Exploration project I Darwin Peru S.A.C. Suriloma La Libertad Au
Exploration project II Peru Gold Resources S.A.C. Urumalqui La Libertad Au, Ag
Exploration project I Core Minerals (Peru) S.A. Virú La Libertad Ag, Pb, Zn
RESPONSIBLE MINING
2.13 PIURA
Although mining is not the dominant economic activity in the region, Piura
has nearly 140 areas open for exploitation, according to the Ministry of
Energy and Mines (Minem). Most of these are located in the province of
Ayabaca and the district of Suyo.
In 2001, Piura postponed a major opportunity: the development of the

gold project Tambogrande, property of the company Manhattan. Due to
strong opposition from the local population, this project—which would
have made the region one of the largest gold producers in the country—
was suspended indefinitely.
Currently, however, Piura has some new projects that are turning it into
a major mining destination. For example, in 2010, the phosphate mine
was opened at Bayóvar. There is also the Cementos Pacasmayo industrial
plant, owned by the Hochschild group, and the Río Blanco Copper project.

Exploration project I Minera Ancocala S.A.C. La Caucha Piura Au
Portfolio of mining projects Fosfatos del Pacífico S.A. – Fospac Proyecto Fosfatos Piura Phosphates
Portfolio of mining projects Río Blanco Copper S.A. Río Blanco Piura Cu
Portfolio of mining projects Americas Potash Perú S.A. Salmueras de Sechura Piura Potassium
2
Mining
regions of Peru
2.14 LAMBAYEQUE
There are a number of mining concessions in Lambayeque, located mainly

in the Districts of Incahuasi, Olmos, and Oyotún.
Special note should be made of the Cañariaco copper project, in the

province of Ferreñafe. This is an iconic mining project for Lambayeque
that is expected to bring major benefits to the region.

Portfolio of mining projects Cañariaco Copper Peru S.A. Cañariaco Cañariaco Cu
Exploration project I Salmueras Sudamericanas S.A. Morrope Morrope Nm
RESPONSIBLE MINING
2.15 LIMA
Mining activity in the region of Lima dates back to the times of the Viceroyalty
in the provinces of Huarochirí and Oyón, in the highlands of Lima.
This region is home to limestone deposits, which are used to supply raw
materials to the cement plants, as well as sand and gravel, also for use in
the construction sector.
Lima also has important zinc, copper, gold, and silver mines, such
as Casapalca, Yauricocha, San Mateo, Uchucchacua, and Mallay
(Buenaventura) Iscaycruz (Los Quenuales) Yaulillacu (Los Quenuales) and
Raura (Grupo Brescia) among others.

Exploration project I Votorantim Metais Cajamarquilla S.A. Cerro Puagjanca Lima Zn
Exploration project II Inca Minerales S.A.C. Chanape Lima Au, Pb, Ag, Zn, Cu
Exploration project I Smc Don Pancho S.A.C. Don Pancho Lima Polymetallics
Exploration project I Jidi Mining S.A.C. Gerrillo Chaclla Lima Prospectus
Exploration project I Newmont Peru S.R.L. Illari Lima Polymetallics
Exploration project I Southern Peru Cooper Corporation Sucursal Perú Largato Lima Cu
Exploration project I Candente Gold Peru S.A.C. Lunahuaná Lima Cu, Au
Exploration project II Empresa Administradora Chungar S.A.C. Palma Lima Zn, Pb, Ag
Exploration project I Compañía Minera Vichaycocha S.A.C. Shalca Lima Polymetallics
Exploration project II Compañía De Exploraciones Orion S.A.C. Viento Lima Cu, Mo
3
MINING’S
CONTRIBUTIONS
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RESPONSIBLE MINING
Churín-Oyón
Highway, Lima.
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3
Mining’s
contributions
There are many notable examples of export success stories, thanks to the indirect
employment created by mining. The leading roles in such stories are played by artisans
from a wide range of trades: work with precious metals such as silver and gold, pottery,
traditional handicrafts such as retablos, the garment industry, etc. There is nothing
more encouraging than to see the fruits of Peruvians’ labor admired around the world.
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RESPONSIBLE MINING
Peru owes much of its development to mining. The

mining sector actively contributes to national exports,
procurements, and investments. For example, mining
products made up 60 percent of all national exports
in 2017. That same year, the sector employed more
than 200,000 people, proving that mining also plays
an extremely important role in creating direct and
indirect employment.
There are many notable examples of export success

stories, thanks to the indirect employment created by
mining. The leading roles in such stories are played
by artisans from a wide range of trades: work with
precious metals such as silver and gold, pottery,
traditional handicrafts such as retablos, the garment
industry, etc. There is nothing more encouraging than
to see the fruits of Peruvians’ labor admired around
the world. This is what motivates us to continue
striving in our mission.
Let us never forget that great company called “Peru,

Inc.,” of which we are all shareholders, must be the
most efficient, the most competent, with the greatest
resources and, of course, run by highly skilled and
well-paid staff, whose talent helps the economy to
work to the advantage of all of us. Here are just a few
specific examples of the contributions mining has
made to our country.
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3
Mining’s
contributions
Structure of the exports value
0.8% 3.1% 0.3%

2.7%
2.3% Mining
Non metallic, metallic,
11.4% metallurgical, jewerly
Oil and natural gas
1.8% Fishery (traditional exports)
Agriculture
4.0% Farming
60.5%
Mining Fishery (non traditional exports)
7.5% Textile
Wood and papers
Chemicals
5.2% Others
3.1 EMPLOYMENT
Employment in the mining sector
210,000
200,000
190,000
203,238
180,000
196,234
185,268
184,594
170,000
179,755
176,607
176,607
176,468
173,778
160,000
150,000
January February March April May June July August September
Source: Minem, 2017
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RESPONSIBLE MINING
Mining in Peru creates over 200,000 direct jobs, each one of which
creates six indirect jobs. That means over 1,200,000 indirect jobs. To put
it another way, nearly a million and a half Peruvians depend on mining,
according to the IPE.
Induced effect
Indirect Consumption Consumption

Ground transportation effect effect
Agricultural crops Construction
Maintenance and repair
of vehicles Animal husbrandry Metal products
for structural use
Professional services Restaurants
scientists and technicals Machinery
Education
Metallic products
manufacture
6.25
jobs
generated
Source: IPE, 2017
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3
Mining’s
contributions
Mining employment by region (% of labor force)

16.00
14.98
14.00
12.00
10.00
8.94
8.46
8.00 7.70 7.46
7.16 7.07 7.00
6.00 5.73
4.75 4.53
4.30
4.00 3.53
2.77
2.34
2.00 1.24 1.16
0.49 0.32 0.04
0.02
0.00
San Martín
Arequipa
Junín
La Libertad
Lima
Cajamarca
Cusco
Áncash
Apurímac
Ica
Moquegua
Tacnca
Ayacucho
Puno
Huancavelica
Piura
Huánuco
Callao
Madre de Dios
Lambayeque
Pasco
Source: Minem, 2018
There is no better ally in the fight against poverty than the creation of
formal employment. As such, Peru must focus on social justice, which
means quality production and employment with opportunities for all.
This is the key to ensuring the wellbeing of all our fellow Peruvians.
During a trip to Japan and South Korea, a friend explained to me that

Peru’s coffee industry employs 200,000 people. Thus, he noted, this
industry is a sustainable activity that makes enormous contributions
toward job creation. In reply, I asked him how many of the 200,000 jobs
he mentioned were formal, to which he responded “10 percent.” The jobs
created by mining, on the other hand, are all formal. Every last one.
According to the Peruvian Institute of Economics (IPE) if we were to carry

out all the mining projects currently in portfolio, this would produce US$
30 billion in annual exports; the GDP would rise by over US$ 44 billion,
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RESPONSIBLE MINING
that is, by more than 20 percent; 2.4 million stable jobs would be created
during the operation of these projects; and tax revenues would increase
by S/ 23 billion annually.
3.2 HEALTH AND EDUCATION
For the mining industry, education is one of our top priorities. It is

essential that we work to benefit the children and young people in our
communities, giving them access to a better quality of life, because they
are the future of our country. Of course, such efforts must be spearheaded
by the government, with the support of the business community and the
backing of local residents themselves. This joint effort means adequate
education infrastructure and support for pedagogical processes, through
the provision of information technology and teacher training, among
other aspects.
3Mining’s
contributions
The same holds true for healthcare. Mining companies

carry out many projects in support of healthcare each
year in Peru’s provinces, such as strategic alliances
between these companies and foreign medical
associations, which offer free medical campaigns in
the country’s most isolated areas. These initiatives
include significant contributions consisting of
equipment and infrastructure for regional hospitals,
as well as the donation of medicines and medical
devices.
All of this may sound highly positive and beneficial

for the neediest of communities. However, these
initiatives need to be conducted in an atmosphere
that fosters coordination. Support must be consistent
and coordinated. We will touch on this matter again
below, in relation to shared social responsibility (SSR)
a concept in which we firmly believe, at which point
we will go into further depth on this topic and others.
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RESPONSIBLE MINING
3.3 INTEGRATED PRODUCTION CHAINS
In addition to healthcare and education, mining also

contributes to Peru’s development in many other
areas. Indeed, it cannot be stressed enough that
mining is an activity that benefits us all: employees,
surrounding communities, the region where the
mining operation is located and, ultimately, the
country as a whole.
Mining companies are constantly striving to

boost and invigorate local economies. The key
lies in generating wealth through the creation of
production chains that turns citizens in areas of
mining influence into active participants in the
benefits resulting from this activity.
Mining activity itself is already a production chain,

since it involves the integration of a number of
economic activities and companies for each one of
the stages of a project’s development, and after that,
throughout a mining operation’s useful life. These
activities include transportation, infrastructure,
telecommunications, financial services, chemical
products, and many more, as we can see in the next
figure.
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3
Mining’s
contributions
Mining, productive chains
Competitive natural
Chaining backwards advantage Chaining forwards
Specialized supplies: Mining companies: Processing

Electric power, gas, copper, gold-silver, activities
water, fuels, chemical non-metallic minerals,
inputs, spare parts, iron, manganese, zinc, Manufacturing industry
tires carbon
Forest industry
Equipment and Products: Cathodes and
machinery copper anodes, sulfuric Chemical industry
acid, molybdenum, dore
Specialized services bar, zinc, iron, non- Jewerly
metallic minerals
Universities, research Telecommunications
and development Mineral reserves
centers Health
Electric power generators, Ports and customs

gas and water
Insurance companies
Marketing services
Chains to Foundations
the sides Financial services
(related Universities and technology
Telecommunications
activities) Commerce
Road and port
infrastructure Tourism
Source: AngloGold Ashanti
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RESPONSIBLE MINING
3.4 INVESTMENTS
It is encouraging to see that mining investments in Peru have increased

considerably in recent years. According to data from the Minem, Peru
has a portfolio of 47 projects, with a value of approximately US$ 46.996
billion. This proves just how attractive Peru is as a destination for
domestic and foreign investors.
In 2017, mining investments totaled US$ 4.921 billion, or 16 percent

higher than in 2016. At the macroeconomic level, this accounted for over
21 percent of private investment, a percentage that makes mining one of
the sectors with the highest investments in the country.
In March 2018, the Minem reclassified mining investments into six

rubrics: development and preparation; mining equipment; exploration;
infrastructure, processing and treatment plant, and others. Under this
system, investments in infrastructure accounted for 30.9 percent of all
mining investments, while investments in development and preparation
accounted for 61.7 percent and investments in exploration for 13 percent.
Mining investments (billion US$)
12000
10000
8000
6000
9,940
8,867
8,504
7,617
7,247
4000
4,921
4,251
2000
0
2011 2012 2013 2014 2015 2016 2017
Source: Minem, 2017

3
Mining’s
contributions
Last but not least, note should be made of the efforts by public officials
who have had the bravery and the guts to approve projects in the past.
We are sure that those who are elected in the future will follow in their
footsteps, for the sake of Peru’s development.
3.5 TAXES
Paying taxes on mining activity is also extremely important for the

country’s growth and development, since it generates fiscal resources
that are used to cover certain expenses, such as amortizing the public
debt or fund the State’s investment and current expense budget.
The construction of schools and roads, for instance, is a concrete

example of the contributions mining makes by paying taxes, in turn
driving the development of communities and helping to invigorate local
economies.
At present, the corporate income tax in Peru applicable to the mining

and hydrocarbons sectors accounts for 36 percent of all revenues. In
the last seven years, these sectors have contributed S/ 41,760,700,000.
Peruvian tax structure Corporate income tax

(2010-2017) (billion S/)
Total tax revenue 100% Sector 2017 2010-2017 %
1. Income tax 36.25% Total 18,825.9 169,266.3 100.0
1.1. Corporations 60.00% Mining and hydrocarbons 3,415.8 41,760.7 24.7
2. Other taxes 63.75% Other services 7,438.1 64,455.5 38.1
Manufacture 3,000.5 22,785.8 13.5
Trade 3,429.3 26,915.7 15.9
Construction 1,379.9 11,849.9 7.0
Fishing 70.8 833.3 0.5
Agriculture 91.5 665.3 0.4
Source: SUNAT, 2017

RESPONSIBLE MINING
Thus, despite the drop in metal prices and the lower investments
registered in recent years, the Peruvian mining sector continues to be
one of the country’s largest taxpayers.
One of the major problems facing the Peruvian economy is informality,

which is estimated to account for 50 percent to 60 percent of the GDP,
with the resultant tax evasion. The Peruvian mining sector accounts for
10 percent of the GDP, although some sources suggest that this figure
may be as high as 15 percent.
In a totally formal economy, income tax payments should be aligned

with the sector’s contribution to the GDP. Thus, there seems to be a
lack of proportion between the 10 percent contribution to the GDP and
the 36 percent income tax rate on mining, due to the significant level
of informality in the Peruvian economy. Tax policy in the future must
be aimed at expanding the tax base, rather than penalizing those who
pay their part.
3.6 MINING CANON
Mining unquestionably offers great benefits for Peruvians. This can be

seen in the creation of jobs, new roads, dams for the storage of water
for agriculture and power generation that will bring electricity to the
country’s most isolated areas, among other benefits. The multiplying
effect of mining is enormous, and this can be seen, too, in the contributions
made through the mining canon.
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3
Mining’s
contributions
The evolution of revenues from the mining canon in Peru’s regions has
risen steadily. In 2017, the different regions and municipalities received
over S/ 1,862,700,000 in mining canon. This once again demonstrates
just how important the contributions made by mining can be for district,
regional, and national governments, allowing them to strengthen their
management and work for the good of the population as a whole.
The distribution of mining canon in the regions of Peru exhibits an almost

completely positive evolution from year to year. The central macro-region
(Ancash, Apurimac, Ayacucho, Huancavelica, Huánuco, Ica, Junin, and
Pasco) received the highest amount, at S/ 726.3, which was 70.1 percent
higher than the previous year.
Meanwhile, the southern macro-region received S/ 614.3 million, an

increase of 16.8 percent. This region includes the Departments of
Arequipa, Cusco, Madre de Dios, Moquegua, Puno, and Tacna.
For its part, the northern macro-region—consisting of Cajamarca, La

Libertad, Lambayeque, Piura, and Tumbes—received S/ 445.4 million, a
decrease of 11.3 percent.
As for the eastern macro-region (Amazonas, Loreto, San Martín, and

Ucayali) revenues totaled S/ 1.1 million, making for an increase of 11.9
percent. Lima received S/ 75.6 million, a jump of 83.8 percent compared
to 2016.
Mining canon (billion S/)
6000
5000
4000
3000
5,124
4,157
3,817
2000
3,090
2,979
2,260
1,863
1,497
1000
0
2010 2011 2012 2013 2014 2015 2016 2017
Source: Minem, 2017
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RESPONSIBLE MINING
Regions: Transfer of mining canon to regional

and local governments - 2017/2016 (million S/)
494.5
Ancash 313.7
258.6
Arequipa 22.0
La Libertad 255.0
253.4
Cajamarca 185.2
216.9
Tacna 94.7
177.7
Ica 93.2
56.6
91.4
Puno 87.2
Moquegua 87.4
189.4
Cusco 81.3
49.0
Lima 75.6
41.1
62.4
Junin 25.4
Pasco 44.3
13.0
16.5
Apurimac 3.2
10.8
Ayacucho 15.0
5.2
Piura 31.6
Others 6.6
1.6
0.0 100.0 200.0 300.0 400.0 500.0
2017
2016
Source: Minem, 2017
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3
Mining’s
contributions
3.7 PUBLIC INVESTMENT
A large part of the country’s public

investment is driven by the mining sector.
For example, in December 2017, public
investment grew by 5.3 percent (S/ 2.15
billion) while investment by regional and
local governments did so at a pace of 20.6
percent (S/ 1.336 billion) and 20.3 percent
(S/ 3.244 billion) respectively, according to
a report by the Ministry of Economy and
Finance (MEF).
The cumulative public investment during

2017 totaled S/ 29.499 billion nationwide,
registering an increase of 8.7 percent over
2016. As of December 31, the government
had implemented S/ 10.7 billion (+3 percent) while the regional and local
governments reported a total of S/ 5.778 billion (+7.2 percent) and S/
13.017 billion (14.1 percent) respectively.
Peru needs to promote greater investment, especially in the regions,

given the negative effect on capacities created by the concentration
of spending and a centralist approach to government. Looking at the
economic contributions made by mining, a question arises: why are the
regions not adequately spending the financial contributions made by
mining companies? The answer: due to a lack of management capacity.
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RESPONSIBLE MINING
3.8 MINING FOSTERS OPPORTUNITIES
Why do we say that mining fosters opportunities? The key lies in

understanding that, by invigorating the local economy with financial
investment in infrastructure, the sector facilitates sustainable
development.
First of all, to invigorate the local economy it is necessary to create jobs.

That means, to seek out more local goods and services. Additionally,
infrastructure development must be promoted through the construction
of new roads, projects for electrification, telecommunications, water
resources, healthcare, and education.
Only then do we facilitate sustainable development, which translates

into responsible environmental management, higher productivity, more
development projects and, thus, greater opportunities for all Peruvians.
For example, of the nearly USD 50 billion budget forecast by the Ministry
of Energy and Mines (Minem) for the near future, at least 30 percent
will be spent on infrastructure works. As we know, a mining company
needs roads, electricity, water, and communications, all of which is
infrastructure. We are talking about US$ 15 billion to be allocated to all
sorts of works that will benefit mining companies and the populations in
the areas of influence of this activity.
Anyone who says that mining only creates projects and makes no positive
contribution to the population and the surroundings is simply wrong.
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4
BUENAVENTURA’S
CONTRIBUTIONS
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RESPONSIBLE MINING
Afforestation nursery in
La Zanja, Cajamarca.
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4
Buenaventura’s
contributions
The management capacity of a company such as Buenaventura is vital

in contributing to society. This factor is undoubtedly more relevant than
sharing information on how much money the company plans to invest in
this or that project.
When we emphasize the amount invested, we communicate an

inaccurate message that portrays private companies as bill counters. And
counting money is not the heart and soul of a company’s activities. What
we do is make sure that things work right, that people have a positive
workplace, that the management capacity is strong. And this goes for
both the economic activity in which a company is engaged, as well as its
social responsibility efforts.
It does not matter exactly how much money is spent on social

responsibility. The most valuable factor is making sure that companies in
fact engage in these practices, that their executives spend time on them,
and that they have the management capacity to do so. Money, in and of
itself, does not do anything. Social responsibility is a commitment to the
community and society.
4.1 OUR HISTORY
Over six decades ago, in 1953, Alberto Benavides de la Quintana founded

Compañía de Minas Buenaventura together with a group of Peruvian
investors and the mining companies Cerro de Pasco Corporation and
Sociedad Minera Suizo Peruana Julcani. All of them were responsible for
making the company’s founding possible.
Below is a brief overview of our beginnings as a company and the path

we have taken to get where we are today.
In 1944, after obtaining his Master’s Degree in Geology, Alberto Benavides

returned to Peru and started to work for the Cerro de Pasco Corporation
as an assistant geologist, later becoming the Head of the Explorations
Department for all of Peru.
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RESPONSIBLE MINING
While engaged in his exploratory activities, Alberto found out that the
Julcani mine, in Huancavelica, was up for sale. Since he did not have
enough money to buy it outright, he proposed to the owners that they
lease it to him for a year, with a purchase option.
Later, to get the money he needed to acquire the mine and commence
operations, he invited a group of Peruvian investors and businesspeople
to go in on the deal. This group included Daniel Olaechea, Gonzalo Otero,
Mario Samamé, and Manuel Ulloa, along with his brothers Ismael and
Jorge, and his sisters Rosario and Angelita.
The new company was formed with a capital stock of US$ 200,000.
The Cerro de Pasco Corporation subscribed shares for a 20 percent
stake (US$ 40,000); Bruno Tschudi, on behalf of Sociedad Minera Suizo
Peruana Julcani, acquired another 20 percent (US$ 40,000); and the
shareholders brought together by Alberto Benavides contributed the
remaining US$ 120,000. An agreement was also reached with Cerro de
Pasco, stipulating the sale of the minerals obtained by Buenaventura
for a two-year period in exchange for an advance of US$ 200,000. In
all, Alberto raised US$ 400,000, which was enough to cover the sale
price (US$ 300,000) with a remaining balance de US$ 100,000 to use as
working capital so the company could recommence the extraction and
processing of minerals.
Thus, with the letter sent by Sociedad Minera Suizo Peruana Julcani
to Alberto Benavides, dated April 27, 1953, with retroactive effect
as of January 1 of that year, Compañía de Minas Buenaventura was
incorporated, leading to the start of our operations at the Julcani mine in
Huancavelica, the company’s flagship operation.
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¿Why
“Buenaventura”?
Many people ask where the name “Buenaventura” came from. The story
goes like this: When buying the Julcani mine, Alberto Benavides had
to choose a name for the new company. Initially, he considered names
such as “La Suerte” (“Luck”) or “La Esperanza” (“Hope”) but none of them
convinced him.
It was then that Ángela de Koenig, the wife of Robert P. Koenig, who
was president of the Cerro de Pasco Corporation at that time, suggested
the name “Buenaventura.” Alberto liked the idea, since according to
the Spanish Royal Academy, “buenaventura” has two complementary
meanings in Spanish. The first is “good luck” or “good fortune,” which all
miners need, of course. The second is “fortune-telling,” which is also apt
given that fate and uncertainty are also variables closely linked to mining
activity.
4
Buenaventura’s
contributions
Over time, there came new mines. In 1956, Buenaventura began to

explore Huachocolpa, also located in Huancavelica, and discovered
Recuperada mine, which contained high-grade veins.
Years later, we commenced operations at Orcopampa, which started

out producing silver, later becoming a major gold producer in 1988.
In 1975, we started operations at Uchucchacua, after 15 years of

metallurgical testing that made it possible to install the concentrating
plant there. Today, this is one of our most successful silver operations.
Later on, we acquired a stake in El Brocal, and a year after that, with
the goal of supplying our own electricity, we established the Consorcio
Energético de Huancavelica (CONENHUA).
In 1993, in collaboration with Newmont, we started operations

at Yanacocha, and took part in the privatization of Cerro Verde, a
Buenaventura affiliate that is now the owner of the world’s largest
copper concentrating plant.
In 2011, we started operating at Antapite, and shortly thereafter,

explorations led us to La Zanja and Coimolache, two open-pit mines
in Cajamarca.
In 2012, operations commenced at Mallay in Oyón and at Breapampa

in Ayacucho. In 2014, we began work at Huanza, a hydroelectric
plant that provides clean energy to our operations; and Río Seco, a
technological innovation that adds value to the silver mineral with
manganese content from Uchucchacua.
In 2017, Tambomayo became a reality. This gold mine is a sign of

confidence in the country’s potential, creating new opportunities for
growth for our employees, their families, the communities, and the
region of Arequipa. And we continue to advance and grow.
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These are just some of the milestones that have contributed to the
country’s development, reaffirming our conviction that each one of our
mining units and projects will help solidify Peru’s position as we move
forward into the future.
Daniel Olaechea, Chairman of Alberto Benavides de la Quintana,

Buenaventura’s first Board of Chairman of the Board of Directors
Directors (1953-1956). (1979-2011) and Founding President
(2011-2014).
B r u n o Ts c h u d i , m e m b e r o f Roque Benavides, Chairman of the

Buenaventura’s first Board of Board of Directors (as from 2011).
Directors (1953) and Chairman of the
Board of Directors (1956 - 1979).
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contributions
Strategic Plan
Drivers
Tambomayo
Orcopampa
La Zanja
Coimolache
Yanacocha GOLD
OPERATIONS
Uchucchacua -Mallay
Julcani
Safety
ZINC
Human
resources
El Brocal
Social Cerro Verde
management BASE
METALS
Supports
Environmental
management
San Gabriel
Technology Quecher Main
and innovation
GOLD
Energy
Communications Yumpaq
Head office
SILVER
El Faique BASE
PROJECTS
Trapiche
METALS
San Gregorio
Marcapunta Norte-Sur
Yanacocha Sulfuros
Coimolache Sulfuros
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4.2 RELATIONS
By actively participating in the traditions, customs, and activities of

the communities around us, we are able to grow closer with and forge
bonds of trust with residents and their leaders. These relations are
also important in guaranteeing the effectiveness and sustainability of
the social investment projects that we promote as stakeholder in such
local development.
There are a number of activities that are carried out every year in an
effort to strengthen these relations, while providing information to the
communities where we are active, getting to know them, becoming
involved, and making connections. This helps to bolster our open-door
transparency policy. These rapport-building and communication tasks
involve a range of actors from different areas of the company, which
helps ensure the suitable coordination of this work to the benefit of all.
For example, we organize guided visits to our operations for the

general population, as well as regional and district authorities,
students, and journalists; we broadcast radio advertisements on
the community work being done; we publish newsletters such as
“Willaspa” (the Quechua word for “communicate”); we hold workshops
and interventions in induction processes on issues tied to social and
environmental matters; and we attend to the thousands of people who
visit the Communications Offices at our mining units.
4.3 LOCAL EMPLOYMENT
One direct way to invigorate the economy in the communities near our
projects is by building local capacities to prepare residents to work in
our operations or any other economic activity.
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To achieve this, we organize training programs aimed at improving

the employability of the local economically active population,
simultaneously fulfilling our operations’ needs and expanding residents’
possibilities of development in other areas.
Based on the needs of each operation, we create job positions for

people from the regions where we are active, who account for nearly
60 percent of all of Buenaventura’s employees.
4.4 LOCAL PROCUREMENTS AND SERVICES
The company fosters economic development in the community by

locally procuring a range of goods and using local services. To ensure
that local companies meet the quality and safety standards we require
in our operations, we offer a training program to help local companies
improve their services so that they can comply with our operational
needs.
Each year, we purchase an average of S/ 16 million in inputs such as

timber, aggregates, and food from local businesses, while injecting
nearly S/ 115 million into the local economy in the contracting of services
such as construction, maintenance, machinery rental, transportation,
and meals.
4.5 PRODUCTIVE DEVELOPMENT
We seek to help strengthen local production in the areas of influence

where we work, whether independently or in synergy with government
programs, with the sole intention of improving those families’
wellbeing. To achieve this, we primarily promote the implementation
of the PRA Buenaventura in the regions of Northern Lima, Arequipa,
Moquegua, and Huancavelica; and Productive Development Projects
in Cajamarca. These two programs foster development by creating
economic undertakings (productive projects and local businesses) to
meet market needs.
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PRA Buenaventura
Is the company’s productive development and business articulation
program, carried out as part of a strategic alliance with Cáritas del Peru.
The program’s main projects include Andean crops, fruits, vegetables,
alfalfa and fodder, livestock, alpaca and vicuña wool, guinea pigs, dairy
products, trout, agroindustrial projects, textile handicrafts, and more.
PRA Buenaventura
37 Production
projects
16.1 Million soles

in sales
10
Promoted
preparatory
projects
4,118 Producers articulated

with the market
13.7 Million soles

leveraged
Source: Buenaventura, 2017
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4.6 INFRASTRUCTURE
We help build and upgrade roads, schools, and health establishments

in the areas near our mining units and projects. This improves living
conditions and access to services, and thus contributes to closing
existing gaps and promoting greater local competitiveness that will
subsist well beyond the life of the mine. In particular, we promote
water and sanitation projects, as well as water infrastructure works to
improve water use and agricultural production.
Water and sanitation

In the area of water and sanitation, we provide technical files for works
in different villages with the goal of significantly increasing access to
basic sanitation in our areas of influence.
With the aim of improving access to water for agricultural use, we also
provide support in the form of pre-investment studies for irrigation
projects.
Roads
We have joined forces with the regional governments, local
municipalities, and private businesses in the area to carry out high-
impact projects to improve the population’s quality of life through road
infrastructure, connecting isolated communities to reduce travel time
and allow their products to reach different markets on a timely basis.
These different road projects include the construction, maintenance,
and upgrading of highways, local roads, and streets.
One major example is the road from Churín to Oyón, which was opened
to through traffic in 2011. We are particularly proud of this project, since
it was one of the roadworks carried out by Buenaventura through a
public-private partnership with the mining companies Raura and Los
Quenuales, the Ministry of Transportation and Communications the
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Regional Government of Lima, the local governments, and the peasant

communities.
Another road infrastructure project worth noting is the road from

Huancavelica to Lircay, which will benefit nearly 450,000 inhabitants
in the Huancavelica Region with the paving of 77 km of the roadway
that connects the cities of Huancavelica and Lircay, in the central
highlands of Peru. This project is a joint effort between the authorities
of Huancavelica and Buenaventura, in which the company funded the
final technical study to make this project a reality.
4.7 HUMAN DEVELOPMENT
We are especially concerned with education and healthcare services in

Peru’s most remote regions.
Education
The “Learning to Grow” (“Aprender para Crecer”) project is our
primary vehicle for providing support in this area. In alliance with
the “Entrepreneurs for Education Association” and Cayetano
Heredia Peruvian University (UPCH) this program seeks to build
teachers’ capacities and strengthen their performance in the areas
of communication and logic/mathematics, which will have a direct
effect on students’ academic results. We also promote the “Teach Peru”
(“Enseña Peru”) program, an initiative aimed at developing soft skills among
children in primary school and high school, along with the implementation
of a range of educational projects in local communities.
As part of our goal of improving access to higher education, we run

a Full Scholarship Program in Uchucchacua, Orcopampa, La Zanja,
Julcani, and San Gabriel; and provide support to different institutions
of higher education, especially the University for the Development of
the Andean Region (UDEA) in Lircay, Huancavelica.
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Healthcare
When it comes to healthcare, we organize medical campaigns every
year in the areas of influence of each one of our mining units, as well
as participating in the medical missions organized together with the
Peruvian-American Medical Society (PAMS). This effort also involves
the collaboration of the Regional Government of Huancavelica, the
Regional Department of Health, and the University for the Development
of the Andean Region (UDEA) in Lircay. In the first ten years of
organizing these campaigns, we have provided over 14,000 doctor’s
appointments and more than 500 surgeries, as well as contributing
equipment and supplies to the Lircay Hospital.
4.8 GOOD CORPORATE GOVERNANCE PRACTICES
Buenaventura’s good corporate governance practices are part of our

emphasis on greater responsibility and a commitment to transparency
in our business management. We have highly trained management
committees and directors with key duties who are involved in defining
strategies and determining corporate objectives.
Since 1953, Buenaventura has demonstrated its respect for our

shareholders, the Board of Directors’ policies, positive stakeholder
relations and, above all, the value of transparency. Over the course of
our history, this has helped us to attract financial and human capital,
all while operating efficiently and creating value.
Our company has a highly diversified shareholding structure, such

that all of our actions are aligned with and regulated by market
requirements. Buenaventura’s Board of Directors consists of seven
members, of which four are independent. Additionally, over 75 percent
of Buenaventura’s shares are held by international investment funds.
Approximately 70 percent corresponds to institutional investments,
while over 20 percent to the Benavides family.
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Our compliance with good corporate governance practices is top for

our company. It has made us the first Peruvian company to adhere
to the United Nations Global Compact, an international initiative to
promote the creation of a global corporate citizenship to reconcile the
interests and processes of business activities with society’s values and
demands.
S
ER CL
LD I
O
EN
EH
Vision, mission, values

TS
AR
Good Corporate
SH
Governance
Regulators
Suppliers and
supervisors
Social and Enviromental

Responsible Company
Financial
Churches
system and
and NGO’s
insurances
IE S
N IT
Central
WO
Regional and
government local governments
MU
RK
RS
E
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As a company, we have assumed the commitment to comply with the

Compact’s ten principles on human rights, labor and environmental
standards, and the fight against corruption. We are proud to note
that we have been recognized by the Global Compact in Peru for our
progress in complying with and disclosing its principles.
We also promote the Extractive Industries Transparency Initiative

(EITI). This international organization brings together governments,
extractive companies, civil society groups, and multilateral organisms
who voluntarily improve their transparency levels with regard to
the tax contributions paid by companies to national, regional, and
local governments, as well as making it possible to detect potential
corruption through a rigorously independent external audit.
In 2011, Peru became the first country in the Americas to join the EITI,
thanks to the initiative of Buenaventura, who introduced the concept
and called for its implementation.
More transparency
More involvement
More governability
EITI PERU
Less corruption
Less poverty
Fewer conflicts
Companies reveal Independent Government

payments made to verification of reveals payments
payment and
the Government made by the
income
companies
Supervision carried out by

the Working Committee
of EITI Peru
RESPONSIBLE MINING
4.9 PROJECT METHODOLOGY
In 2017, we implemented the project methodology described in the

book Project Management for Mining: Handbook for Delivering Project
Success (2015) by Terry L. Owen and Robin J. Hickson. In fact, Mr. Owen
was our advisor during the implementation and follow-up process.
The objective of this initiative is to reduce inherent risk in a structured

and disciplined manner so as to minimize the exposure of our
investments in the face of our projects’ expanded size.
With this goal in mind, we have defined the following phases or stages
of project maturity:
• Conceptual phase: Begins a few months before finishing the

advanced exploration of the deposit (definition of resources). Seeks
to define the appropriate business case for the development of the
future mining unit, achieving an order of magnitude in the range of
+100 percent to -50 percent for the development of mostly inferred
resources, with an engineering development level of around 2
percent.
• Pre-feasibility phase: Aimed at gathering the necessary in-situ

information to decide between different solution alternatives,
reducing the order of magnitude to a range of +40 percent to -30
percent for the development of a mostly indicated resource, with an
engineering development level in excess of 7 percent.
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• Feasibility phase: Aimed at the development of the alternatives

selected in the preceding phase with a view to freezing the basic
engineering, achieving an order of magnitude of +25 percent to -20
percent for an 80 percent measured/indicated resource, with an
engineering development level in excess of 20 percent. During this
stage, the project’s feasibility is confirmed.
• Development phase: Aimed at developing the controls that will

be used in the project throughout its implementing, achieving an
order of magnitude of +12 percent to -10 percent for a 100 percent
measured/indicated resource and an engineering development
level in excess of 70 percent.
4.10 INTERNATIONAL CERTIFICATIONS (ISO AND OHSAS)
In 2000, Buenaventura began the certification process for its

management systems at the Orcopampa, Uchucchacua, and Antapite
units, which is revalidated annually.
Later on, in 2008 and 2009, the Julcani and Shila-Paula were included
in this process. After that, the challenge was to certify each of the
five units—Orcopampa, Uchucchacua, Antapite, Julcani, and Shila-
Paula—and their management systems under ISO 9001 (Quality
Management) ISO 14001 (Environmental Management) and OHSAS
18001 (Occupational Health and Safety Management) achieving
optimal results.
In 2010, in addition to the annual revalidation of the management

systems, we assumed the challenge of incorporating Recuperada,
Mallay, and La Zanja units into the certification process (ISO 14001 and
OHSAS 18001). The results were satisfactory, achieving the proposed
objective in its entirety.
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The challenge for 2011 was the first-time ISO 9001 certification in
Recuperada and La Zanja units. Our primary target, however, was
to attain corporate certification in ISO 9001, ISO 14001, and OHSAS
18001, including all eight of our units and—for the first time—the Lima
headquarters.
In 2012, Tantahuatay Unit joined the group of mining units certified by

Bureau Veritas, while Procesadora Industrial Río Seco was later added
in 2014.
In 2017, the management systems at Tambomayo Unit were certified

under ISO 14001 and OHSAS 18001, as part of the corporate
certification process.
Currently certified units:

• Orcopampa
• Uchucchacua
• Julcani
• La Zanja
• Tantahuatay
• Río Seco
• Tambomayo
• Lima
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MANAGEMENT
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Patón lagoon in
Oyón, Lima.
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management
5.1 COST OF LIMITED WATER ACCESS
It is regrettable that limited access to water services brings about

health problems such as cholera, eye and skin infections, and more.
It also aggravates poverty and, although it may not be as immediately
obvious, imposes barriers to education. Why is this? Many children
from low-income families must spend inordinate amounts of time and
effort finding water and bringing it to their homes, leading them to skip
school. Things simply cannot go on like this.
As a society, we need to make sure that all of our fellow Peruvians have
an adequate supply of water and access to production activities, such
as agriculture and mining. We believe that mining and agriculture are
both members of the brotherhood of water, in which mining can help
build the reservoirs needed to provide water for agricultural activities
during the dry season.
5.2 WATER RESOURCES MANAGEMENT
It is clear that we must not improvise when it comes to water management.

We need a basin-wide vision, given the constant concern over possible
variations in the quantity of water resources, which can in turn affect other
economic activities, such as farming and livestock breeding. For this reason,
as part of Buenaventura’s social and environmental responsibility policy, we
have implemented actions for the adequate and responsible use of water.
Concrete examples of this policy include the San José reservoir in Cajamarca,
built by Minera Yanacocha S.R.L., which is six times the size of the Peru’s
National Stadium and able to store over 6 million m3 of treated water, which
can be used to supply farming and livestock activities during the dry season.
Note should also be made of the Río Rejo and Río Grande dams, constructed
by Yanacocha, each one of which stores nearly 500 million m3 of treated
water for the same purpose: contributing to local development.
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We have also made a significant effort to reduce the industrial

consumption of water in our operations through the implementation of
recirculation projects and an increase in water volume. In our mines, we
dam 120 million m3 of water annually. This water is used for purposes
of power generation, agriculture, livestock activities, and population.
There is no shortage of water in Peru. The problem is simply that it is poorly

distributed over the course of a year. That is why it is so important to ensure
the water supply at high altitudes by building reservoirs that accumulate
water during the rainy season, so that it can be used at a later date during
the dry season.
5.3 WATER INFRASTRUCTURE AND STORAGE
Access to water is a fundamental human right, and we at Buenaventura

firmly believe in the importance of including water as a fundamental factor
in the development of any project; not only when it comes to mining, but in
all production and service sectors.
One of the policies that we promote as a company is the generation of

environmental assets, such as the construction of dams that make it possible
to sow water (store water resources) during the rainy season so that it can
be harvested (used for agriculture, human consumption, mining operations,
and more) during the dry season. This helps increase the water regulation
capacity in basins. As we mentioned above, together with our affiliates, we
help store 120 million m³ of water annually in 13 different reservoirs that are
used to supply water to our operations and improve the supply of water for
agricultural and livestock use in the surrounding communities.
Peru receives 2 trillion m3 of water annually from rainfall. According to the

National Water Authority (ANA) the country consumes just 1 percent of that
amount, and of that 1 percent, agriculture uses 80 percent, while humans
consume 12 percent. For its part, industry uses 6 percent, and mining in
particular just 2 percent.
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There is more proof of the fact that mining does not use farmers’ water.
Minera La Zanja, in Cajamarca, built the Bramadero dam in the upper
Chancay valley. This infrastructure stores water resources during the
rainy season to ensure its availability year round. In addition to the
water used for mining operations, a great deal is used by local farmers.
Also in Cajamarca, we have the Chailhuagón reservoir, built by

Yanacocha exclusively for the population in the area of influence of the
Conga project. Chailhuagón was built on the lake of the same name in
the village of San Nicolás, creating a dam using local materials to retain
rainwater and thus significantly increase the lake’s capacity.
Before the dam was built, Lake Chailhuagón had a capacity of 1.2
million m3, while the reservoir now has a capacity of 2.6 million.
We find another example at the Orcopampa Unit, in Arequipa, where

we carried out the Wetland Pucará project, conducting the effluent
tributary from the Chipmo mine via a 2,160-meter canal for its final
treatment.
For its part, Sociedad Minera Cerro Verde in Arequipa extended and
heightened the Pillones dam so it could collect more water, using the
surplus in the mine. The company also built a treatment plant to help
clean up pollution in the Chili river, using the treated water for mine
operations.
Also of note is Southern Peru’s proposal to use only desalinated

seawater (via a process of reverse osmosis) for the operation of the
Tía María project in Arequipa. Of the total seawater captured, 40
percent will be used in mining processes, while 60 percent will be
returned to the sea in the form of brine, without causing any negative
environmental impacts.
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While the desalination of water is a positive approach, there are

other alternatives that could have more of an impact, such as the
construction of the Paltiture reservoir in the upper part of the Tambo
Valley, on the border between Puno and Moquegua. This would help
regulate water, providing more of this resource to Arequipa’s farmers
and ranchers, as well as guaranteeing the water necessary for the Tía
María project. It is important to consider that the integration of mining
and agriculture would offer more advantages than the desalinization
of seawater. Looking at the cost-benefit ratio, we believe a reservoir
would be the best approach.
In the upper part of the Huaura valley, we find lake Patón, whose
volume of water has been increased thanks to the expansion of the
dam that feeds the Otuto Hydroelectric Power Plant. At Buenaventura,
we do not use this lake’s water for mining, but instead for a small
hydroelectric plant that produces power for our operations, as well
as benefiting the population of Oyón. For its part, Compañía Minera
Raura has another hydroelectric plant in the same basin, which also
provides electricity to the community.
In short, we focus on investing as a strategy for guaranteeing the

availability of water for mining activities and, of course, the local
populations—especially farmers—over the coming decades. To achieve
this, we store water from the basins during the rainy season and
reuse it throughout the year. This is clearly a fundamental part of a
harmonious relationship between the mining and agriculture/livestock
sectors.
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5.4 POSSIBILITIES TO KEEP IMPROVING
In order to ensure that water resources reach the country’s most

isolated and needy residents, we must eliminate the water access gap.
This is achieved through the adequate settlement of national territory
and, above all, through major infrastructure works that guarantee the
supply of high-quality water over the coming decades.
5.5 THE BROTHERHOOD OF WATER
Peru has been battered by extreme weather events caused by climate

change, including exceptionally severe rainfall throughout much of
the country. The victims of these events have lost their homes, their
possessions, and their jobs, affecting the economy of the country as
a whole. It is high time we lend a helping hand so that we can tackle
these challenges as a country.
In the midst of this difficult situation, we must not only reflect but act to
ensure the proper use of water, along with the reduction and reuse of
wastewater. Water needs to be managed properly during the different
stages of the water cycle: from its capture at the natural source,
through distribution and treatment, right up until the use of treated
wastewater and its subsequent return to the environment, so that it
can be captured once more and thus begin the cycle again. This entire
process requires great responsibility, in compliance with the standards
established in Peruvian environmental law, to guarantee that this vital
resource is used in the service of development and wellbeing for all.
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This resource must be viewed not just as an element in the production

process but, above all, as a vital resource that plays a key role in the
sustainable development of those areas where mining activities are
conducted. As such, its efficient use, the management of its quality
and quantity, the treatment of wastewater, reuse in mining and
metallurgical processes, and the incremental reduction in the use of
water from natural resources are all important aspects that help to
guarantee that other users have water available to them for a range of
uses in the basin, as we have discussed throughout Chapter 5.
In addition to managing water as part of our mining operations, we

have made positive contributions in river basins to the benefit of the
communities and towns near our different projects, reflecting our
environmental and social responsibility. This responsibility takes the
form of water sowing and harvesting, irrigation projects, and the
supply of water for drinking and sanitation. Without a doubt, these are
concrete examples of a true brotherhood of water, which must work
with the government and the communities to establish a new way of
viewing and approaching our relationship with water.
In each one of our units and projects, we hold the firm belief that our
day-to-day commitment to such efforts may make all the difference
in contributing to the sustainable development that we want for our
country.
As such, we call on everyone—the population, all levels of government,

and the private sector in those areas where we conduct our activities—
to continue working together, united by water and our commitment to
solidarity, with greater development for all.
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RESPONSIBLE ENVIRONMENTAL
MANAGEMENT
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Environmental monitoring
in Uchucchacua, Oyón.
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Management
6.1 ENVIRONMENTAL MONITORING
The purpose of environmental monitoring is to guarantee an adequate

environmental performance by studying impacts on the environment
and surrounding communities. For this reason, mining operations and
projects require environmental oversight and care mechanisms that
comply with international standards and the local laws in force.
Between 2011 and 2017, Buenaventura obtained the approval of 80

Environmental Management Instruments (IGA) including Environmental
Impact Assessments (EIA) Semi-Detailed Environmental Impact
Assessments (EIAsd) Amended Environmental Impact Assessments
(MEIA) Environmental Impact Statements (DIA) and Supporting
Technical Reports (ITS).
6.2 CITIZEN PARTICIPATION
We work hard to build trust among our neighboring communities. As

part of these efforts, we seek to strengthen participative monitoring
activities with national, regional, municipal, and community authorities,
as well as bolstering treatment systems to guarantee the quality of
all dumpings. To help ensure greater efficiency in the Participative
Monitoring Committees, we provide training for local leaders and
residents at respected vocational institutes such as TECSUP and
CETEMIN.
The participative monitoring activities promoted by Buenaventura

are not required under local laws. Rather than merely complying with
the minimum legal standards, we have taken the initiative, acting out
of the company’s genuine concern for its responsible performance in
caring for the environment and ensuring transparency in its relations
with the communities surrounding its operations.
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6.3 MINE CLOSURE
In keeping with our environmental policy and the legal provisions in

force, Buenaventura complies with our mine closure plans at all of our
units.
The basic goal of these works is the physical, geochemical, and

hydrological stabilization of the terrain. To achieve this, we perform
a meticulous review of the technical specifications established in the
detailed engineering for the closure of adits with effluents, vents,
barren material and tailings deposits, among other activities.
This is complemented by new products that add value to the

impermeabilization of adits, ensuring their long-term functionality.
We also provide detailed information on the closure costs for each
component, providing an orderly economic overview and reducing
costs while complying with the applicable legal requirements at all
times.
At present, works for the closure of environmental liabilities are totally

complete. The remediated areas (Lircay, Rifle, Ruminaqui, Ayacucho,
Chaquelle, and Huachocolpa) have been fully integrated into the
natural landscape.
At the Esperanza, Angélica-Rublo Chico, Poracota, and Shila-Paula

Units, we have eliminated all effluents from the adits, recovering the
natural water tables, marshes, and wetlands, as well as grazing areas
used by the communities, controlling the physical, geochemical, and
hydrological stability by building watertight plugs in the adits and
applying water-expansive polyurethane resins and liquid cements.
This methodology is also being applied at Recuperada, Julcani, and
Orcopampa with positive results.
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Responsible Environmental
Management
Research is performed with the goal of implementing technological

improvements in the closure works at La Zanja and Tantahuatay,
where we use Technosols that will help us improve the physical and
geochemical stability of the barren material deposits and pits. We also
continue to implement wetlands for the natural treatment of water at
Orcopampa and Julcani.
In 2017, significant progress was made in the progressive closure

works, with an investment of US$ 21 million. This figure includes our
companies Minera La Zanja S.R.L., Compañía Minera Coimolache S.A.,
and Sociedad Minera El Brocal S.A.A.
Colquirrumi: A milestone in peruvian environmental law

In 1996, Compañía Minera Colquirrumi, a subsidiary of Buenaventura,
voluntarily began work on the remediation of mining liabilities in
Hualgayoc, Cajamarca, which were caused by old mining companies
between 1920 and 1940.
This work was performed on 300,000 m2 of land located in El Sinchao

and Hualgayoc, areas that have been completely recovered and are
now apt for agricultural and livestock activities. The investment totaled
over US$ 19 million.
The closure plan for Colquirrumi, submitted to the Ministry of Energy

and Mines (Minem) in 2004, was used as a model to draft the laws
that now regulate the management of environmental liabilities in
the Peruvian mining sector (Law 28271, regulated one year later by
Executive Order 059-2005-EM).
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WORKING TOWARDS SHARED
SOCIAL RESPONSIBILITY
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Students of Oyón, Lima.
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Working towards shared
social responsibility
7.1 WHAT IS SOCIAL RESPONSIBILITY?
Social responsibility is typically understood as a company’s commitment

to the society. This concept includes its respect for the environment,
its concern for its workers’ health and safety, along with its support
for the sustainable development of neighboring communities. These
actions are aligned with good corporate governance practices, in which
the company is conceived of as an actor that often works on its own to
help develop the area where it operates.
However, this way of seeing and understanding a company’s

contribution to society is focused on handouts, instead of defining the
concept of true responsibility. At Buenaventura, we have a different
approach, under which we propose a management model that we call
shared social responsibility.
7.2 FROM SOCIAL RESPONSIBILITY TO

SHARED SOCIAL RESPONSIBILITY
This concept needs to be addressed from a new perspective: shared social

responsibility. In this model, the company, the central government, the
local and regional governments, universities, NGOs, communities, and
civil society all work together to achieve a common objective: sustainable,
decentralized, and inclusive development. This new approach leaves
behind those models in which everyone depend on companies for the
development and wellbeing of society. We need to understand just
how vital the mining sector’s contributions are to the development of
Peru. This, in turn, means that we must strive to help the sector grow.
Governments, companies, and communities must all play their part and
engage in constructive dialogue. All of us must be socially responsible.
The sustained and inclusive growth and development of our country will
benefit us all, but above all, it will help the country’s neediest inhabitants.
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Corporate social responsibility

(typical relations)
Regional
government
International Local
cooperation government
Central
NGOs
government
Company
Other
Universities
institutions
Civil Community
society
Shared social responsibility
Regional
government
Central Local
government government
International
NGOs
cooperation
Common
goal of
development
Company Universities
Other
Community
institutions
Civil
society
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7.3 MINING COMPANIES AND THEIR COMMITMENT
Mining companies in Peru must operate just like our counterparts

in developed countries. We are committed to our communities, our
workers, the environment, and our shareholders. As noted above, our
greatest responsibility is to comply with good corporate governance
practices, acting with transparency in all of our business dealings.
Thus, we as mining companies recognize the importance of taking

into account economic, labor, social, and environmental aspects when
making decisions. As they say, “You are out of the competition if you
don’t use best business practices.”
7.4 WHAT SHOULD WE EXPECT FROM THE GOVERNMENT?
A government’s role lies in ensuring a competitive climate for

investments, establishing rules and administrative procedures for civic
participation processes, and having the ability to engage in joint efforts
and establish constructive alliances with mining companies and civil
organizations.
Additionally, governments must require sound environmental and

social practices, ensure that communities have access to adequate
information, and demand compliance with all standards, as well as
effectively monitoring this compliance and providing the population
with sufficient information.
Finally, they must provide the community with basic services and
ensuring the equitable distribution of benefits, so that regional and
local governments can make the most of their resources.
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7.5 WHAT SHOULD WE EXPECT FROM LOCAL COMMUNITIES?
Communities play an incredibly important role, since it is they who

are called on to contribute to a company’s competitiveness. The
populations located in the area of influence of a mining project must
keep themselves informed of the respective company’s progress and
results.
It is vital that communities try to integrate the company’s objectives

with their own interests, to help forge a relationship based on trust
and respect through participative dialogue. This goes for all community
members, not just local authorities. Communities also need to build
capacities that facilitate joint work to make the most of the business
opportunities that may be indirectly created by mining companies.
Communities should also demand that the different levels of
government uphold their respective duties.
7.6 PUBLIC-PRIVATE PARTNERSHIPS
As we noted at the start of this chapter, shared social responsibility

(just as its name implies) means that all of the actors involved share
an objective and, thus, we move forward together as one. To achieve
this, the government (federal, regional, and local) the community,
and private enterprise must coordinate actions, programs, projects,
and other initiatives that contribute to the sustainable and inclusive
development of the population.
The best way to understand and implement shared social responsibility

is through public-private partnerships (PPPs). The purpose underlying
this form of cooperation is to provide or improve access to basic
services such as education, healthcare, infrastructure, or other projects
that benefit communities.
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In the case of Buenaventura, PPPs allow the mining canon to be

used for different works and projects. One example of this is the
construction of the road from Churín to Oyón, which required a US$
30-million investment. This road, which measures over 29 km long, has
benefited a total of 20,000 local residents. This was possible thanks to
a PPP between the Ministry of Transportation and Communications,
the Regional Government of Lima, the Provincial Municipality of Oyón,
the mining companies Raura, Los Quenuales, and Buenaventura, and
the peasant communities in the area.
Other examples of coordinated work between private enterprise, the

government, and local communities toward a shared objective include
Huaura-Sayán-Churín, Río Seco-El Ahorcado-Sayán, Huancavelica-
Lircay, and Vizcachani-Caylloma roads (see figure). All of these were
promoted as part of PPPs, allowing for commercial exchange and the
socioeconomic development of local populations.
In 2017, we promoted over 40 projects. Working together with the

authorities, we succeeded in finalizing public investment in five projects
for a total of S/ 23 million. Through these efforts, we proved that it
is possible for teamwork to happen among authorities, communities,
and private enterprise, bolstering the mining sector’s role as a true
facilitator of development, with the indispensable leadership of the
local population and its authorities.
Through PPPs, we were able to achieve teamwork with local and

regional authorities in sectors such as sanitation, agriculture, education,
and transportation. As long as the public and private sectors continue
to cooperate, PPPs will keep promoting major projects.
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Road projects Total investment (US$)

Churín-Oyón 30 Million
Huaura-Sayán-Churín 152 Million
Río Seco-El Ahorcado-Sayán 21 Million
Huancavelica-Lircay 122 Million
Vizcachani-Caylloma 78 Million
Other projects Total investment (S/)

Waste plant in Orcopampa - FONIPREL 4.5 Million
Improvement of Juan Ugaz School in Santa Cruz - PRONIET 11.5 Million
Water and sanitation in Cosñirhua y Malata - MVCS 4.8 Million
Waste water treatment plant in Ichuña - MVCS 7.2 Million
Street paving in Huachocolpa - PNMB 5.3 Million
Huancarama - Tintaymarca canal - Mi Riego Programme 5 Million
US$ 520
million
Since 2012, Buenaventura has managed to leverage investments to the tune of US$ 520
million in infrastructure and other important projects, including highways.
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NEW CHALLENGES FOR
THE MINING INDUSTRY
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Workers
inside the mine.
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New challenges affecting
the mining industry
8.1 INCREASE IN CAPITAL EXPENDITURES AND OPERATING

EXPENSES
As we have seen, mining investments have hit extremely high levels in

Peru in recent years. Nevertheless, production by the companies in this
sector has been on the decline. In the 2011-2015 period alone, mining
investment rose by 267 percent, according to the Minem, exceeding an
amount of US$ 42 billion. So then, why is production falling?
Gold production 2013-2017

(fine grams)
2009 183,994,692
The statistics of the last nine
2010 163,400,376 years show us that, despite
the mining investment, the
2011 164,013,489 production of the main metals,
such as gold in this case, has
2012 161,544,666 continued to decline.
2013 151,486,072
2014 140,097,028
2015 146,822,907
2016 153,005,897
2017 151,103,938 Source: Minem, 2018
First of all, both capital expenditures and operating expenses have risen
considerably, due to the higher costs of labor, materials, equipment,
and surface lands, which are often difficult to acquire (see chapter 8.3:
Purchase of lands). The time required to put a mine into operation has
also increased, with the number of permits, authorizations, and new laws
making the process slow and complicated, instead of expediting it.
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Main mining projects paralyzed (US$ 13,700 millions)
Copper (Cu) Gold (Au) Copper (Cu)
Minas Conga Tía María

Local company: Minera Yanacocha S.R.L Local company: Southern Peru
Mother company: Newmont (51,35%), Mother company: Grupo Mexico
Buenaventura (43,65%), IFC (5%) Investor country: Mexico
Investor country: USA/Peru Clasification: EIA approved
Clasification: EIA approved Location: Arequipa
Location: Cajamarca Start of planned operations: To define
Start of planned operations: To define Projected investment: US$ 1,400 millions
Projected investment: US$ 4,800 millions Projected annual production: 120,000 TMF/Cu
Projected annual production: 680,000 Oz/ Au
y 54,000 TMF/Cu, Au
Copper (Cu) Copper (Cu)
Quellaveco Río Blanco

Local company: Anglo American Quellaveco Local company: Río Blanco Cooper S.A.
Mother company: Anglo American (60%), Mother company: Zijin Mining Group
Mitsubishi (40%) Investor country: China
Investor country: UK /Japan Clasification: Exploration
Clasification: EIA approved Location: Piura
Location: Moquegua Start of planned operations: 2021
Start of planned operations: 2021 Projected investment: US$ 2,500 millions
Projected investment: US$ 5,000 millions Projected annual production: 200,000 TMF/Cu
Projected annual production: 225,000 TMF/Cu
Source: Minem, 2017
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the mining industry
For example, to move forward with a new mining project, it is necessary

to comply with over one hundred formalities, including environmental
studies, certificates, permits, and many authorizations. In Chile, by
contrast, the formalities for starting up a mining project are much more
straightforward. A new project can start operating in just 24 months.
Aside from the administrative procedures, social conflicts can also cause
delays or even the suspension of new projects, works, or expansions. At
present, there are around 20 mining projects that have been forced to
halt progress in different regions around the country, causing losses of
approximately US$ 67 billion to the country in recent years, according
to the IPE.
According to a report by Thomson Reuters (Gold Survey 2017) operating

expenses have been rising year-on-year around the world. In 2017, they
increased by 36 percent in Peru, while the country’s production levels fell.
Effective cost variation 2011 vs 2012 (US$ oz Gold - Au)

Million soles
780
760 +22 -21
+2 +1
+3 +2
FX
740 +3
Others
+5
Credits by subproduct
Rubbish
Recovery process
Energy
720
Royalties
Fuel
US$ / oz
+22
700
738
Labor
680 +41
660
Law g/t
640 658
620
2011 2012
Source: Thomson Reuters GFMS, Gold Survey 2013.
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8.2 THE RULE OF LAW AND ITS ENFORCEMENT
Along with rising costs and an increase in the amount of time necessary
to implement mining projects, relationships between companies and
the community have become more and more fraught. In a democracy,
each citizen has specific duties and rights. These allow us to express
ourselves freely and make collective decisions through a number of
mechanisms, while respecting the law and the authorities elected to
represent us. This social system is known as a State under the rule of
law.
Under this democratic system, no social group has the right to stand in
the way of the decisions made by the government, represented by duly
elected authorities with the power and the jurisdiction to grant permits,
licenses, or other authorizations. So what happens when a dominant
interest group tries to impose its view against such decisions, permits,
and authorizations? This is equivalent to kick the playing board of our
democracy.
Playing Our Roles

In a State under the rule of law, the law must be obeyed. To make sure
this happens, everyone needs to play a role in society. The government,
for example, must promote and guarantee investments, regulating
and channeling the benefits gained from different economic activities.
Remember that in a democracy, it is very difficult to work in rural
areas without the backing of the local authorities. For its part, private
enterprise must continue to invest in new projects, while communities
welcome and support the arrival of the benefits that come with this
investment.
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8.3 PURCHASE OF LANDS
One of the greatest challenges faced by any mining project is the

purchase of lands. If no agreement can be reached with the communities
or families that own the land, this can lead to delays in setting up the
mine and commencing operations, even if the company already has all
the necessary permits and authorizations.
This process is regulated in Law 26505, known as the Act for Private
Investment in the Performance of Economic Activities on Lands Owned
by the Government and by Peasant and Native Communities. This law
establishes two ways to purchase lands, as we will see below. Bear in
mind that the Company must attempt to carry out the first procedure
before resorting to the second.
In the first procedure, the company must reach an agreement with the
landowners so as to obtain the right to exploit the lands. According to
the law, “to dispose of, encumber, lease, or exercise any other act on
community lands in the highlands or jungle, it shall be necessary to
obtain a resolution of the general assembly, with the favorable vote
of no less than two thirds of all community members” (Law 26505,
Section 11). Oftentimes, however, residents are unwilling to negotiate
due to mistrust, misinformation, or the involvement of anti-mining
groups, thus delaying projects for weeks, months, or even years.
If no agreement can be reached, the company can then resort to the

easement procedure, whereby the government grants the land in
concession to the company, which must pay the communities proper
compensation. “If the deposit is determined to be of national interest
by the Cabinet, following a prior report by the Ministry of Energy and
Mines (Minem), the landowner shall be compensated beforehand by
the owner of the mining claim at a fair price, plus the corresponding
indemnity” (Law 26505 Section 7).
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In 2017, the Prime Minister’s Office officially created the Vice Ministry
of Territorial Governance, under which there are three secretaries:
the Secretary of Decentralization, the Secretary of Social Affairs
Management and Dialogue, and the Secretary of Territorial Demarcation
and Organization.
Special note should be made of the creation of the Secretariat of

Social Affairs Management and Dialogue, which will take a preventive
approach in fostering dialogue between mining companies and
communities, while speeding up the process for the purchase of lands
and the obtainment of operating permits.
For its part, the Conflict Resolutions Office will continue to take up the
task of addressing and managing crises.
8.4 ENVIRONMENTAL POLICIES: APPROVAL OF THE EIA
In recent years, Peru has made significant progress in the development

of its environmental policies. In 2008, the Ministry of the Environment
(MINAM) was created, followed by the National Environmental
Certification Service for Sustainable Investments (SENACE) in 2012.
Both of these entities are landmarks that demonstrate the government’s
interest in improving the country’s environmental standards. Even so,
there is still a great deal left to be done.
We believe that Peru’s environmental laws need to be gradually

updated until reaching the same standards as developed countries.
As the former Minister of the Environment Antonio Brack used to say,
we cannot establish levels used in countries such as Switzerland or
Germany, because Peru’s authorities and private sector are not yet
ready to assume, on a sustained basis, policies that have been in force
elsewhere for over 150 years.
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The Environmental Impact Assessment (EIA)

The EIA contains the evaluation and description of the physicochemical,
natural, biological, socioeconomic, and cultural aspects of a project’s
area of influence, to help determine the existing conditions and
capacities there and analyze the nature and the magnitude of
the project, while measuring and predicting the effects of its
implementation, and prioritizing measures for prevention and control
that ensure a harmonious balance between the development of mining
activities and the surrounding environment.
It is important to stress the interdisciplinary nature of the assessment,

which includes a comprehensive evaluation of a project’s area of
influence, while also performing a qualitative and quantitative
identification of the environmental impacts, both negative and positive,
attributable to or derived from the project.
It could be said that the EIA makes it feasible to prevent or foresee a

project’s environmental impacts thanks to the continuous application
of measures intended to diminish or eliminate environmental
deterioration, thus helping to optimize the sustainable use of the
environment and guarantee the environmental feasibility of production
activities.
According to Law 27446, Section 17 of the Act on the National

Environmental Impact Assessment System (SEIA) the competent
environmental authority shall have a maximum period of ninety (90)
days to review the EIA and reach a decision on whether to approve
or reject the project. This authority may also condition its approval on
certain changes that need to be made to the document, which must
be made by the deadline established by the authority in consideration
of the magnitude of the requested changes. If this deadline transpires
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and the competent environmental authority fails to issue any

pronouncement, the EIA shall be considered approved. Section 25
of the law states that the competent environmental authority may
delegate the review of EIAs to institutions with proven experience,
qualifications, and specialization, for which purpose it shall establish
the necessary mechanisms.
8.5 CONVENTION 169, PRIOR CONSULTATION, AND

INDIGENOUS PEOPLES
By César Humberto Cabrera
The following article, entitled “Convention 169, Prior Consultation, and

Indigenous Peoples,” was written by César Humberto Cabrera, an
economist, consultant, and research, as well as the former Director of
Governmental Affairs and Public Policies at Yanacocha. We would like
to thank the author for kindly granting his permission to include it in
this chapter.
In the late 1990s, certain groups of anti-mining activities began to

refer to the peasant communities of the highlands as indigenous or
tribal peoples. The purpose behind this was to include them under
ILO Convention 169 concerning indigenous and tribal peoples, thus
entitling them to the prior consultation mechanism with regard to the
government’s legislative and administrative decisions. It should be
noted that the reason for this sudden interest was not a rejuvenated
enthusiasm for peasant communities, indigenous peoples, the ILO, or
the methods of consultation. The fact is that prior consultation was
viewed as a means for delaying or preventing the mining investment
that had started to once again gain momentum in the Andes at that
time. On the one hand, because the possible effects—real or fictitious—
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on indigenous and tribal peoples caused by transnational companies

could be a factor that would cause these investors to withdraw,
especially if they were from English-speaking countries. On the other,
because the procedures for consultation with indigenous or tribal
peoples could be much more complex, given their intercultural nature,
than the regular citizen participation and consultation procedures.
We should recall here that 1993 marked the start of a slow recovery
of investment in mining exploration and development that began to
pick up steam during the second half of the decade and exploded
exponentially after the turn of the century. This process came about
thanks to the end of the Cold War and the second globalization of
the international economy. It was tied especially to the opening of
Peru’s economy and the sale of state-owned companies (including
mining companies) together with economic stabilization and the end
of hyperinflation and currency volatility. This period also involved
a complete revamping of mining law and the system regulating
mining concessions and property, thus providing guarantees for the
development of exploration and production. At the same time, the
threat of terrorism was also brought under control, following attacks
on mining camps and the general inability to travel freely throughout
the country, especially in the highlands.
One particular characteristic of this period was the arrival of dozens of

exploration companies and the world’s biggest mining outfits, who had
been absent from Peru for over 20 years, as they had in other developing
companies. Mining exploration and development had been affected by
the practices of nationalization in the 1970s, as well as the economic
chaos and the civil war of the ‘80s, which took many lives among
Peruvian miners. The first to return were mainly Canadian, American,
English, and Australian investors—i.e., companies from English-speaking
countries. The Chinese would not appear on the scene until later, except
for the purchase of Marcona by a Chinese state-owned company. It is
worth noting that this process had a head start in Chile. Even though
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Codelco—Chile’s state-owned company that had a monopoly over

Chilean concessions and copper production—was never privatized, the
country opened itself up to mining exploration and investments by
foreigners starting in the 1980s.
It must be pointed out that the anti-mining activists were unconcerned

with the fact that this approach to the peasant communities involved
a break with Peruvian social and political thought of the 20th century.
Nor did they care that some among their ranks had once been linked
to old leftist movements that helped develop this thinking in Peru,
particularly with regard to indigenous issues. It seems that the end
of the Cold War, the collapse of the communist regime in the Soviet
Union, and the capitalist transformation of China had changed these
activists’ guiding principles. Starting in the second half of the ‘90s,
opposition groups—some of them with anti-extractivism postures—
from Washington, D.C., London, Berlin, and Amsterdam became the
source of inspiration and funding for these activities.
ILO Convention 169

This Convention refers to indigenous and tribal peoples in independent
countries. The Convention seeks to preserve these peoples’ rights
through prior consultation, understood as intercultural dialogue aimed
at respecting their traditions and customs. The purpose is to “[ensure]
that members of these peoples benefit on an equal footing from the
rights and opportunities which national laws and regulations grant to
other members of the population” (Article 2). For such purpose, it is
specifically established that “[i] indigenous and tribal peoples shall enjoy
the full measure of human rights and fundamental freedoms without
hindrance or discrimination” (Article 3). As such, this Convention refers
to those peoples who are not integrated into society or the state, and
who thus tend to be excluded from enjoying the rights offered by
the country’s Constitution and its laws to all of its citizens. Given that
the members of peasant communities enjoy the same rights as other
citizens and form a constituent part of society and the State in Peru,
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the mining industry
this Convention does not apply to them. It is for this reason that the
anti-mining activities were forced to break with the country’s social and
political thinking that considered indigenous peoples and, particularly
peasant communities, to be an essential part of society and the State.
Now then, if the peasant communities could be included within the

scope of this Convention, then there is no way they could form any
part of the majority of the country’s population, and certainly not part
of the nation’s backbone, as is the case in Peru. This is precisely the
conception that had been established in Peruvian social and political
thought throughout history: the indigenous lineage forms a core
element among Peru’s population, which has in turn blended with
an array of racial and cultural aspects and traits. There is no way
the population of the peasant communities of the highlands could
be considered an indigenous or tribal people, separate from the rest
of Peru, except by forcing the application of ILO Convention 169 and
the consultation mechanism established therein. This view of the
peasant communities as a social group that is not integrated into
the local population, separate from and different than the rest, who
furthermore feel themselves to be or identify themselves as such, runs
counter to reality, a fact that seems not to trouble these activities. The
anti-extractivists fought to shoehorn reality so that it fit within an
international standard that it clearly had nothing to do with, but which
they felt could be useful in helping them achieve their goal of halting
mining investment.
The Break with Peru’s Social Thought

Starting in the late 19th century and continuing throughout the 20th,
social and political thinkers and essayists maintained that indigenous
peoples formed the backbone of Peru, rather than viewing them
as a marginal group without any relation thereto. In fact, the so-
called “indigenous population,” i.e. that which was identified as such
in national censuses, accounted for approximately 62 percent of
the total population in 1827, a proportion that remained stable for
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most of that century (Gootenberg, Paul. Población y etnicidad en el

Peru republicano (siglo XIX): algunas revisiones. IEP, 1995). Of this
indigenous population, no more than 50 percent lived in what we now
refer to as peasant communities, while the other 50 percent consists
of hacienda laborers, individual owners of small plots of land, or urban
workers, according to the figures reported in this census. As haciendas
expanded, incorporating entire indigenous communities, the people
who lived on these estates gradually declined until it accounted for
a relatively small fraction of the national population just before the
agrarian reform was implemented.
It was the migration process, however—especially following World War

II—that changed the population’s demographic distribution, causing
the population of the peasant communities to shrink. Peru became a
mainly urban, coastal country, while the migrant indigenous population
began to play an ever larger role at the center of the Peruvian melting
pot of cultures. The population of the peasant communities, which
had represented 30 percent of the national total in the 19th century
(in the form of the “Indian común” or community system) was now a
fraction of that number. This population was now a fundamental part
of the national majority, however, from which it was differentiated
primarily by a land ownership regime that had been created in 1920
with the goal of defending it from encroachment by large haciendas.
These communities were gradually broken up into smaller plots of land
over time. By the end of the 19th century, they consisted of groups of
individual pieces of land within a larger, collectively owned property.
Once the reasons behind their creation disappeared, however, this
became a limiting factor on the formation of a real estate market.
Indeed, these properties are often bought and sold, but their prices are
a far cry from their true market value, given the restrictions suffered
by these transactions because the owners do not have a formal deed
registered with the public records offices.
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the mining industry
What began to be known as the “Indian question” starting during Peru’s

republican area was in fact a problem faced by the national majority,
not the indigenous minorities that exist today in many English-speaking
countries (United States, Canada, and Australia). It was a problem
that afflicted the rural population, the Peruvian population, which
was essentially based in the countryside until the mid-20th century.
It was a challenge for Peru and its future. Specifically, it involved the
economic and social problems faced by the lowest strata of society, and
not so much a people situated outside that society, a people different
from the Peruvian nation then in its formative stages. The indigenous
population was unquestionably the national majority, not a minority,
whether or not it lived in a peasant community, first in the countryside
and much later in the major cities. Thus, the exclusion of the peasant
communities from the nation’s population—suddenly deeming them
people of a different culture starting in the late 20th and early 21st
century—was discriminatory, plain and simple; a failure to take into
account the history of Peru and its population. Unfortunately, this
claim would catch on with the appearance of the anti-mining activities
in the late 20th century. They were not so much interested in the
indigenous populations, as they were eager to use any tools at their
disposal to slow or halt mining investment. They were joined in this
break with reality and the country’s social thought by well-intentioned
people who were not necessarily against the development of mining
activity. They were simply people who looked with good will upon the
populations from the peasant communities.
Thinkers and Essayists

Manuel González Prada, one of the most important Peruvian thinkers
and essayists of the late 19th and early 20th centuries, wrote that “the
Indian problem is economic and it is social” in his book Horas de lucha,
first published in 1908. The “Indian problem,” as it was called back then,
was the peasant problem, or if you like, the problem faced by those
who were at the very base of the social structure, not the problem
of a race, of a people or a culture foreign to Peru. It was the problem
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involving the national majority and their fate, not that of peoples or
groups to be viewed as different, unintegrated with the country, which
needed to be consulted in a process of intercultural dialogue, as it
would be eventually suggested in the late 20th century.
Later on, Víctor Raúl Haya de la Torre, one of the heirs to González
Prada’s thought, wrote in a letter in 1927 to the members of the Grupo
Resurgimiento in Cusco that the revolution in Latin America and the
struggle for continental unity would be eminently indigenous tasks,
because the majority of the population was indigenous. Haya de la
Torre, working with estimates (and not a census) that circulated at the
time, wrote, “If 75 percent of our Americas are indigenous, and there
can be no doubt that the vast majority of the indigenous population
forms part of the producing class, peasants and workers, the program
of political and economic unity of our peoples must be built on that
majority; it must be their doing” (Complete Works, Haya de la Torre,
Vol. 1, p. 188). To put it another way, the indigenous population is the
core of the producing class, not a people who had to be consulted in an
intercultural dialogue.
Haya de la Torre, like the other Marxists of his time, believed that
the producing classes, i.e., the indigenous population, were primarily
responsible for the transformation and development of Peru and the
Americas. At no point did he think—because this would have clashed with
reality—of the indigenous population of the coast and the highlands as
a people, consisting of commune members or independent owners of
land plots, with which the Peruvian state was responsible for entering
into an intercultural dialogue. Haya de la Torre used the name Indo-
America or Indian America to refer to what most called Ibero-America
or Latin America. In his thought, the essence of Cusco, Peru and the
Americas was racially indigenous, although culturally mixed.
Around that same time, José Carlos Mariátegui, one of the thinkers
who spent the most time grappling with the so-called “Indian problem,”
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argued—like González Prada—that this “problem” was economic

and social in nature, rather than ethnic or cultural. He believed that
“practically the only thing remaining from the Tawantinsuyo [the Inca
Empire] is the Indian. The civilization itself has perished; but the race
has not perished” (7 ensayos de interpretación de la realidad peruana,
p. 327 as opposed to English-speaking America. He also explained
that “the Indian problem and the land problem (…) boil down to the
same problem” (op. cit., p. 207); that is, the land problem. In the essay
“Ideología y política” (“Ideology and Politics”) Mariátegui reiterated that
“the indigenous problem can be identified with the land problem” (op.
cit., p. 367).
Of course, when Mariátegui refers to “practically the only thing

remaining,” he is talking about a series of cultural elements fused
with their Spanish counterparts, not a pre-Columbian culture that
differentiates it and distinguishes it from the rest of Peru, as in the case
of the so-called Indians of the jungle. On the other hand, Mariátegui
believed that “we are a nascent nationality” (op. cit., p. 322) and that
“the Indian must be the foundation of our nationality” (op. cit., p. 324).
He argued that “what gives the Indian the right to prevail in our vision
of today’s Peruvian is, above all (…) his demographic predominance”
(op. cit., ibid.) this is the fundamental issue at stake. He later goes on to
say that “the presence of three or four million men of autochthonous
race in the mental panorama of a people of five million should be
no surprise to anyone” (op. cit., p. 325). Culturally, Peru was already
a country that combined indigenous and Spanish elements, wherein
the latter predominated, as was generally recognized until the early
1990s. Racially speaking, the Indian was the essential component, with
Caucasian and African—and to a lesser extent, Chinese and Japanese—
elements.
These ideas are fundamental. Indigenous people, who form the absolute
majority of the population, are those who were building the Peruvian
nation, in Mariátegui’s view. That is exactly what was occurring at the
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time, and has continued to occur in the 85 years since he wrote about
the matter. The indigenous population, whether in the countryside or
the city, has continued to build the Peruvian nature, using contributions
from European culture, as has been done by other peoples. That is why
it never would have even crossed Mariátegui’s mind to suggest an
intercultural dialogue between Peruvian society and the state, on the
one hand, and the Andean indigenous population who lives in peasant
communities. How could there be a dialogue between the indigenous,
the creators of the Peruvian nation and its culture, and the inhabitants
of the peasant communities, who are also Andean indigenous peoples?
Or, to put it another way, how can there be an intercultural dialogue
between the nation that the indigenous have created and the peasant
communities inhabited by those same Andean indigenous people?
Quoting González Prada in his speech at the Politeama Theater,

Mariátegui even suggests that “the nation (he might have said ‘the
nascent nation’) consists of the masses of Indians spread across the
eastern part of the cordillera” (op. cit., p. 253). How could the Peruvian
nature engage in an intercultural dialogue with an essential part
of itself? For this to be possible, we would have to deny the role of
those “masses of Indians” as the forgers of the Peruvian nature, which
would be an expression of the worst kind of discrimination. It was the
“Indians,” above all, who created this nation at a time when they were
in the process of developing a mestizo culture. What’s more, this racial
intermingling is still occurring to this day, and will continue to occur in
the future.
“In Vallejo,” says Mariátegui, “we find, for the first time in our literature,
an indigenous sentiment, virginally expressed.” He believed that “this
indigenous sentiment finds, in his verses, its own modulation” (op.
cit., p. 301). He wrote that “what characterizes his art is the Indian
element,” which “sums up the spiritual attitude of a race, of a people”
(op. cit., p. 305). Naturally, Mariátegui never thought of Vallejo as being
outside the nation or Peru’s nascent culture. As such, he never would
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have attempted an intercultural approximation or dialogue with Vallejo

due to his expression of an “indigenous sentiment.” Vallejo was and is
an expression of Peruvian culture, of the nascent Peruvian nation.
After World War II, Peruvian and foreign intellectuals and thinkers
engaged in the study of the country’s circumstances delved deeper
into this thinking with regard to the so-called indigenous population. In
particular, they harshly criticized those who viewed it as unintegrated,
as somehow outside Peruvian society, which at that time was already
beginning to experience the massive migrations to the cities, and
particular, to Lima.
The group of intellectuals clustered around the Institute for Peruvian

Studies (IEP) was among those who took up this task and debate
with the greatest intensity, with the involvement of numerous
anthropologists and sociologists. One of them, Fernando Fuenzalida,
denied the existence of “a compartmentalized society, divided into
three hierarchized ethnic segments, occupationally specialized and
possessors of their own distinct cultures.” He also rejected the idea that
“mobility between these three segments is rare to nonexistent.”
“Reality has shown us,” he wrote, “that (…) none of these characteristics
holds true. Those groups that are said to belong to one stratum or
another exhibit, at the local level, blurry and imprecise boundaries,
while in a horizontal comparison, it is practically impossible to
establish connections. These allegedly parallel cultures are far from
static: traits of pre-Hispanic origin and European origin—with the
latter predominating—can found throughout the scale, while reference
points from all the groups that form part of the system are oriented
in a single direction. The cultures of the lower strata constitute mere
subcultures of scarcity or want” (Fernando Fuenzalida, et al. El indio y
el poder en el Peru. IEP, 1970, p. 81).
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There can be no questions that these assertions have nothing to do

with the idea of isolated indigenous peoples, with different cultures
with which it is necessary to establish an intercultural dialogue, as has
been claimed since the early ‘90s. The culture of all strata was viewed
as a mestizo culture, with both pre-Hispanic and European traits, in
which the latter predominated, which has been true for a long time now.
What’s more, the so-called “culture” of the lowest strata, essentially
indigenous peasants, was viewed as a “subculture of shortage or want,”
which is something completely different and which does not justify
an intercultural dialogue, nor the application of ILO Convention 169.
Following the agrarian reform and the mass migrations, this racial and
cultural intermingling continued, giving rise to other subcultures, such
as that of entrepreneurs, which we find in all of Peru’s coastal cities and
the larger cities of the highlands. Nevertheless, it continued to be the
indigenous peoples—the majority of the population—who drove racial
intermingling in Peru, although they already had their own culture—a
mestizo culture—that they continued to develop at the same time as a
number of subcultures.
In the same volume, the noted French sociologist François Bourricaud

put things even more clearly: “The Indian, the cholo, and the misti [T.N.:
A slang word used in the Peruvian Andes to refer to anyone who is not
an indigenous person from the jungle or the highlands] belong to one
and the same culture and society.” In case of any remaining doubt,
Bourricaud remarked of the so-called indigenous society that “it no
longer constitutes an autonomous unit” (François Bourricaud. El indio
y el poder en el Peru, p. 183).
The Indigenous Communities

Fuenzalida also published an essay entitled “La estructura de la
comunidad indígena tradicional” (“The Structure of the Traditional
Indigenous Community”) as part of the book El campesinado en el Peru
(The Peasantry in Peru) (IEP, 1970). In it, he cites Bernard Mishkin, one
of the authors of the famous Handbook of American Indians, published
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by J. Steward in 1946, in which he states, “The Quechua Indian is not

a primitive tribalist,” but rather “the peasant of a nation” (op. cit., p.
63). For his part, Fuenzalida states that “the community of Andean
indigenous peoples is not the remnants of a pre-European society, but
the most characteristic institution of a living contemporary peasantry”
(op. cit., p. 64).
At the same time, he asserts that “the Peruvian indigenous community

is a product of the Conquista. Its constitution involves the disruption
of a system of peasant relations and its orientation toward goals
imposed by colonial governments, the organization of Inca society
into easily manageable units capable of providing the country with
labor and supplies, and paying for its own administration” (op. cit., pp.
65-66). Later on, he makes the vitally important note that the “legal
term used to refer to the member of a community was “tributario” (or
“taxpayer”). This helps to understand the position of the común within
the administrative whole. A común (a peasant community) is the most
basic unit for tax collection and labor reserve” (op. cit., p. 71). For this
reason, when San Martín and Bolívar tried to put an end to the Indian
común by distributing the plots of land among their inhabitants, they
were unable to do so, since the new republic required them to continue
being taxpayers and the bedrock of the national treasury. When the
guano boom made it possible to put an end to the indigenous tax and
black slavery, the governing class did not take the path anticipated by
the continent’s liberators, putting the Indian común in a dire situation.
We must recall here that so long as the members of the común paid
taxes, their lands were protected by the Spanish Crown, first of all, and
by the nascent republic after that, which ceased to be true starting in
the second half of the 19th century. This situation was taken advantage
of by the latifundistas, or large landowners, to appropriate their lands,
especially during the last few decades of the 19th century and the first
few of the twentieth, which Leguía sought to stop with the creation of
official indigenous communities.
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For his part, José María Caballero, who was also associated with
the IEP, said that, “In the cultural and ideological sphere, the most
characteristic part of the community is the fusion of indigenous and
Spanish elements in the gestation of a new, extraordinarily vigorous
Andean culture. Among the peasants on the haciendas, it is also
possible to find the elements of this new culture, although not so
well defined given the limits and distinctions imposed by patriarchal
domination. In the communities, on the other hand, it has been able
to develop more freely. Historically, these were the kilns in which the
new culture took shape” (José María Caballero. Economía agraria de la
sierra peruana. IEP, 1981, p. 287).
Thus, according to Caballero, an expert on the peasant economy of

the highlands, the members of peasant communities were the ones
who contributed most to the creation of the new Peruvian culture.
How, then, can we aim to engage in an intercultural dialogue with the
peasant communities of the highlands that were nothing less than the
“kilns in which the new culture took shape”? Until the late ‘90s, no one
would have been so bold as to make such a suggestion. It was the anti-
mining activities who first brought up the matter.
Elsewhere, Caballero quotes Rodrigo Montoya, who states that

“the Andean, at that time (from the end of the 16th century through
the second half of the 19th century) was already the synthesis of a
recreated pre-Hispanic component and a feudal component that had
been profoundly internalized by these peasant communities” (op.
cit., p. 287). Accordingly, Caballero concludes that “the communities
seem to have acted as hubs of cultural fusion, transformation, and
dissemination” (op. cit., p. 283) thus becoming one of the driving
forces behind the long process of mestizaje that has led to the Peru
of today. For this reason, we cannot look at peasant communities as
the strongholds of a pre-Hispanic culture that has been maintained for
nearly five hundred years in the Peruvian Andes, with which we must
enter into an intercultural dialogue.
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This was the general consensus in Peruvian social thought up until the
1980s. Of course, the reality that these writers sought to describe in
such detail was transformed even further with the agrarian reform.
This intensified both horizontal and vertical mobility and the mass
displacement of populations, including those who lived in peasant
communities, to towns, cities, and even abroad. The racial presence
of the Indian—who by then already shared one and the same culture
with the misti, although they may have had a subculture of shortage
or want—gradually declined in Peruvian society with the acceleration
of the process of racial intermingling. Certainly, the main current
in this intermingling, in racial terms, was indigenous, with smaller
Caucasian and African elements, as well as the influence of Chinese
and Japanese immigrants who had come to Peru in the 19th and 20th
centuries. Naturally, the peasant communities that have subsisted are
far from being separate, unintegrated bodies from society, which have
conserved a distinct culture with which the State must enter into an
intercultural dialogue. The peasant communities are a fundamental,
inseparable, mestizo part of today’s Peru.
The Prior Consultation Act

The Prior Consultation Act of 2011 could not, then, be a response
to pressure from an Andean indigenous group that sought the
preservation of its rights as a minority. The truth is that such pressure
never existed. This law was largely a response to the events in Bagua,
which shocked the country due to their violence and the cultural gap
which they laid bare. Most, if not all, of the members of congress
who voted in favor of the law surely imagined it as applied to some
of the indigenous peoples of the jungle, which was certainly a salient
issue. After that, the anti-mining activities did everything they could
to include the peasant communities of the highlands, despite the fact
that they “were the kilns in which [Peru’s] new culture took shape.”
For this reason, the long road to establishing the regulations on the
law was largely a struggle to include the peasant communities of the
highlands in the consultation process, which was partially achieved. Of
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course, no one objected to the prior consultation process being carried

out with the indigenous and tribal peoples of the Amazon region, which
is completely reasonable.
On the coast and in the highlands of Peru, no one—or almost no one—

considers themselves indigenous, as we might expect. According to an
official census reported on by the Vice Minister of Intercultural Affairs
at that time, less than 1 percent of the population in the peasant
communities consider themselves indigenous (meeting of the Mining
Dialogue Group held on April 27, 2014). To be clear and direct about
the issue, the peasant communities of the highlands, even those where
Quechua is the first language, do not consider themselves indigenous.
Nevertheless, this is one of the conditions—i.e., self-identification—
required under ILO Convention 169 in order to deem a people to be
indigenous. As such, it is quite surprising to find that the Ministry of
Culture is conducting “intercultural” consultation processes in peasant
communities in the highlands, even if—for the time being—they involve
matters that have not given rise to disagreements or conflicts. Indeed,
the Ministry of Culture has restricted its consultations among peasant
communities in the highlands to the State’s administrative decisions
(for example, the creation of a national park) likely as a way to gauge
the country’s reaction. However, it seems that the real interest among
certain officials in this Ministry is to set a precedent for applying
prior consultation with indigenous and tribal peoples to the peasant
communities of the highlands.
The prior consultation process is being applied to peasant communities

under ILO Convention 169 simply because they have a type of property—
collectively owned, in theory—that renders their participation possible.
However, it must be said that this type of property currently represents
an obstacle to the right to personal property, which applies to all
Peruvians, including the members of these communities, ultimately
turning them into second-class citizens. There is a de facto, but not de
jure, individual ownership of land plots, which means that the members
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of peasant communities—some of whom even live abroad—are unable

to freely dispose of their assets like the rest of Peru’s citizens. This
unacceptable form of discrimination must be corrected. It should be
noted, however, that in many peasant communities, there have been
transactions with people who are not community members, including
mistis, who have become members in order to facilitate the transfer
of ownership.
Those promoting prior consultation for the peasant communities of

the highlands—which they claim to be supposed expressions of an
indigenous culture—have forgotten the fact that most of the population
that might consider itself racially indigenous no longer lives in peasant
communities, but in the cities or in the countryside as independent
parceleros, or small-scale landowners. It must be noted here that
many of these parceleros were members of captive communities
during the expansion of the haciendas. Later, under the agrarian
reform, they become cooperative members first, and parceleros later.
These peasants, who may consider themselves racially indigenous,
are no different at all from those who currently live in the peasant
communities, except for the fact that they have a deed for the land
they own. For their part, the members of the peasant communities
have been de facto landowners for decades now, but they still lack
the right to register it with the public records office. In this regard,
the movement that seeks to freeze the peasant communities in time
so that they fall within the scope of Convention 169 and the prior
consultation process, is a discriminatory, backwards, anti-historical
movement.
Another distinctive trait required of the peasant communities of the

highlands in order to be eligible for prior consultation, according to
the Ministry of Language, is their language. Here, it should be noted
that the majority of native Quechua speakers do not live in peasant
communities, according to the 2007 census. Nearly half of them live
in cities, and at least 30 percent more live in rural areas outside the
peasant communities, as independent parceleros. Being a native
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Quechua or Aymara speaker is therefore not a distinctive characteristic

of the peasant communities who seek indigenous classification based
on this criterion. If it were, then Quechua or Aymara would have to be
languages spoken almost exclusively by the members of the peasant
communities, which is not the case.
Ultimately, belonging to a peasant community is not a sign of cultural

difference, a starting point for intercultural dialogue. It simply means
that the ownership of its members’ land plots is part of a property
regime created nearly one hundred years ago to defend them from
pressure at the hands of the large haciendas. Let us recall once more
that these peasant communities were created in Peru to protect
peasant properties from being devoured by voracious latifundistas, as
they expanded in the late 19th century, because of the integration of
domestic production (mainly wools) into the global market. With the
disappearance of latifundia, there is no reason whatsoever to maintain
this property system that now burdens certain Andean peasants,
unlike their parcelero counterparts, which some seek to use for
purposes for which the system was not created. The truth is that the
State should give the members of peasant communities the chance to
obtain property deeds for their plots of land, which may be registered
with the public records office, putting an end once and for all to the
informal purchase and sale system that has grown up.
The idea is to adapt legislation to the facts—i.e., the actual requirements

of the peasant population, and not the other way around, that is, to the
viewpoints and purposes of the anti-mining activities and certain well-
intentioned people that back them. It is completely baseless to force
an imaginary intercultural dialogue with the population of the peasant
communities in order to apply the prior consultation established
under ILO Convention 169. This may be a need for mistis interested in
obtaining resources from those in developing countries who are willing
to support indigenous populations, culturally speaking, which are not
found either on the coast or in the highlands, but only the jungle.
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A solution in accordance with reality

The government should focus the application of ILO Convention 169
on the indigenous and tribal peoples who live in the Amazon region,
who are the only ones who have continued to exist on the margins
of national civic life and the State, with whom the government can
establish an intercultural dialogue. The fact is that these peoples
were never conquered by the Incas, nor were they integrated into the
Viceroyalty. They simply happened to live inside the boundaries that
were eventually established as Peru’s following independence.
In the case of the peasant communities of the highlands, which form

an essential part of Peru as the driving force of our cultural melting
pot and creators of the Peruvian nation, they should be included in
the participation and consultation system—which has been very
thoroughly developed by now—as established by the laws applicable
to all Peruvians when a mining operation seeks to establish itself near
their property.
It is also vital, however, to give these peasant communities the chance

to obtain deeds of ownership over the plots of land they have been
using now for decades, as opposed to remaining in their current legal
limbo. Of course, the granting of deeds in each peasant community is a
process that must be decided on solely and exclusively by its members
and no one else. In any case, it should be made crystal clear that the
peasant communities are not indigenous or tribal peoples existing
outside Peruvian society and the State. Rather, they are the backbone
of both of them.
To establish a supposed intercultural dialogue with Quechua-speaking

communities in Cusco is to consider them foreign to Peruvian society
and the State, when they are in fact part of both. This is a fiction that
must come to an end, ensuring progress and development for all of
Peruvian society, but also freedom from discrimination for those
populations that are not, and do not consider themselves, indigenous,
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culturally speaking. Quechua-speaking Cusco has forged today’s

Peru, as has Aymara-speaking Puno. Peruvian society and the State
do not need to establish an intercultural dialogue with the peasant
communities of Cusco and Puno, because they are the very ones who
have created and developed this society and State. They are the most
iconic expression of Peru’s cultural melting pot, and a fundamental part
of the society and the State that have arisen in our territory. We must
return to the Peruvian social and political thought that was cast aside
in the late 1990s. Let us set aside this current of thought that denies
the intermingling of the peasant communities, and thus, the cultural
intermingling of the country as a whole.
8.6 OPPORTUNITY COST
Gold price 2000-2018

1900
1800
1700
1600
1500
1400
US$ PER OUNCE
1300
1200
1100
1000
900
800
700
600
500
400
300
200
JAN00
JUL00
JAN01
JUL01
JAN02
JUL02
JAN03
JUL03
JAN04
JAN04
JAN05
JAN05
JAN06
JAN06
JAN07
JUL07
JAN08
JUL08
JAN09
JUL09
JAN10
JUL10
JAN11
JUL11
JAN12
JUL12
JAN13
JUL13
JAN14
JUL14
JAN15
JUL15
JAN16
JUL16
JAN17
JUL17
JAN18
Source: Kitco, 2018
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As they say, “you don’t know what you have until it’s gone.” Fortunately,
opportunity cost helps us to choose the best option available by
comparing it with others. This way, we can determine what we gain or
lose, depending on the decision we make.
In Peru, the opportunity cost with regard to mining is tied to making

the most of our natural resources when prices are high, or postponing
their production. This is the opportunity that must be seized, given
just how much metal prices can fluctuate, as we can see in the figures
below.
Silver price 2000-2018

55.00
45.83
US$ PER OUNCE
36.67
27.50
18.33
9.17
0.00
JAN00
JUL00
JAN01
JUL01
JAN02
JUL02
JAN03
JUL03
JAN04
JAN04
JAN05
JAN05
JAN06
JAN06
JAN07
JUL07
JAN08
JUL08
JAN09
JUL09
JAN10
JUL10
JAN11
JUL11
JAN12
JUL12
JAN13
JUL13
JAN14
JUL14
JAN15
JUL15
JAN16
JUL16
JAN17
JUL17
JAN18
Source: Kitco, 2018
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We must not waste the chance to generate new revenues for the country
by using our natural resources, which are located in inhospitable areas
where no other industries reach. Only then will the country obtain
higher revenues from the payment of the canon, royalties, and other
contributions made by the mining sector, allowing it to use these revenues
for the benefit of all Peruvians.
This means making decisions based on technical and economic factors,

and not mere beliefs or political expediency and the like. If the country
opts against developing its mining resources, all Peruvians will be
forced to assume this opportunity cost. Are we willing to postpone
our development, growth, and better access to the basic goods and
services the population requires?
In a State under the rule of law, each one of us has the chance to make
that decision, whether by casting a vote for our authorities, or through
the mechanisms established in a democratic regime. Our growth and
development must not wait.
8.7 WHAT THE FUTURE HOLDS
As we have seen in the preceding chapters, Peru’s mining potential is

immense, and the projects currently in portfolio are highly promising.
Unfortunately, many of them have yet to be implemented.
In the face of this situation, it is clear that we must take the bull by the
horns to prevent further hindrances to mining investments. It is clear
that mining has played a major part in the economic boom we have
been experiencing for the last few years. We are losing the chance to
counteract a cycle of economic downturn, drifting toward a recession.
If the pending mining projects were implemented, the outlook for the
Peruvian economy would be quite different.
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What is to be done? The effort to simplify the process for obtaining

permits, whether from the Ministry of the Environment (Minam) the
Ministry of Culture, or the Ministry of Energy and Mines (Minem)
must continue to move forward. We must not complicate things
unnecessarily if we want these projects to move forward.
8.8 SPEECH GIVEN UPON BEING NAMED

DOCTOR HONORIS CAUSA BY THE UNMSM
On October 26, 2017, I was honored to receive the Degree of Doctor

Honoris Causa from the Major National University of San Marcos
(UNMSM). Below, I would like to share with you the speech I gave
on that occasion, in which I address certain current issues to which I
believe it is important to draw attention, given our responsibility for
the development of our country.
Dr. Orestes Cachay Boza, Chancellor of the Major National University

of San Marcos (UNMSM); vice chancellors, deans, professors, and
authorities of the university; Ministers of State; members of Congress;
ladies and gentlemen; dear friends:
It is a great pleasure for me to be with you this afternoon at the Major

National University of San Marcos a university which I regularly have
the honor of visiting as a speaker and panel member at different forums
and events, and which always receives me with open arms in our shared
effort to strengthen the ties between private enterprise and academia.
I am deeply honored to be receiving the distinction of Doctor Honoris

Causa, which now makes me part of this prestigious university. I receive
this degree with immense gratitude and esteem, and of course, humility.
For me, this distinction reinforces my mission to continue working for
the wellbeing of our country, and especially to help strengthen public
education in Peru. You can be sure that I will do my utmost to honor this
recognition.
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I am especially grateful to Mr. Carlos Quispe Atúncar for his kind words,
as well as my parents and my entire family, my friends, and all of you
for being here today.
San Marcos is an institution marked by great prestige, quality, and

tradition, traits that have made it one of the most important universities
in our country, and in the region as a whole. Through its classrooms
have passed great Peruvians such as Jorge Basadre Grohmann, Raúl
Porras Barrenechea, and Abraham Valdelomar, among other illustrious
figures who have helped forge our country, as so many continue to do
to this day.
My grandfather, Alberto Benavides Canseco, also studied at San

Marcos. In 2001, San Marcos University bestowed the distinction of
Doctor Honoris Causa on my father, Alberto Benavides de la Quintana.
I remember how thrilled he was to receive that recognition. Some
years later, in 2013, the university paid him a posthumous tribute, in
a ceremony presided over by the Vice Chancellor of Research that was
attended by Mr. Pedro Pablo Kuczynski, who was a close friend of my
father’s, and to be honest, of the whole family.
As you can imagine, just talking about the prestige of this university,
as well as the close relations that my grandfather and father had with
it, make this occasion all the more meaningful for me. Once again, my
sincerest gratitude goes out to the leaders of San Marcos for granting
me this honorary degree.
I want you all to know that I am committed to education as a whole,

and to university education in particular.
In this regard, it is vital for all of us to support a public education that

offers opportunities for progress and wellbeing to talented youths
from underprivileged backgrounds.
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the mining industry
At this point, I would like to take a minute to share a few thoughts with you:
Government, university, and enterprise

They say that there are many factors that allow people to develop. Much
has been said of the economic factor, or social access, but I can assure
you that the only thing that truly makes a difference is education. One
person stands out from another because of education and knowledge
alone. It is education that helps us to deal with life, exchange ideas,
and of course, contribute to the future of our country. It enables us to
progress as people and makes us more useful to society.
That is why we must insist on strengthening the bonds between

government, universities, and enterprise. These actors need to seek a
consensus and work together to improve the quality of education and
help educate Peruvians. In the case of public universities, the government
must provide the resources necessary to guarantee an excellent
education. This requires each one of us, as a society, to contribute. Peru’s
businesspeople have a major responsibility in this process.
The origins of higher learning in Peru date back to 1551, when the Major
National University of San Marcos was founded under the name of Royal
University of the City of the Kings. Later, it would change its name to
Royal and Pontifical University of San Marcos, in honor of the patron
saint of this institution.
Later the universities of San Cristóbal in Huamanga and San Antonio

Abad in Cusco were established. At that time, the only ones who attended
universities were aristocrats, moneyed Creoles, and the children of
Viceroyalty’s officials. In other words, education at that time was just for
the most privileged.
Nowadays, things are different. There are now more than 140 universities
in Peru, of which about 50 are public. We are second in Latin America
when it comes to the number of universities we have, behind only Brazil.
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RESPONSIBLE MINING
This leads us to ask some relevant questions. Are Peruvian universities

offering a high-quality education? Can the professionals graduating
from these schools meet the requirements of the market and the needs
of the country?
To find the answer, we must start by creating synergies. This is a shared

responsibility that must be carried out based on a long-term vision.
Indeed, it must form part of the government’s education policies.
To promote the virtuous circle of education, we must promote

appropriate roles for each entity. The government is responsible for
establishing a clear education policy that prioritizes innovation and
development, while also regulating the quantity and quality of the
education on offer, and promoting scholarships and research projects,
which play a vital role.
For their part, universities should be hiring highly qualified professors

with professional experience in their areas of expertise. These institutions
should also remain in direct contact with society, where companies play
an important role. This will help them remain up-to-date on the latest
professional requirements and technological trends.
In my interactions with universities in general, and with San Marcos

in particular, I have seen a positive change in attitudes toward their
integration with different sectors, especially with the business sector.
The fact that San Marcos recently created the “1551 Business Incubator”
with the goal of promoting entrepreneurship reflects this change in
favor of economic and social development.
It is important to highlight this change in attitude among universities

such as San Marcos and their openness toward the business sector.
This is an encouraging sign of their intention to work toward a positive
integration, a worthy goal that we must continue to encourage.
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the mining industry
You may be asking yourselves, “What, then, is the role of private

enterprise?” Part of its role is to provide information on what it
requires of professionals, announce the new profiles required by the
entrepreneurial/productive apparatus, create formal job positions,
promote applied research, and foster the development of employees.
A lot is said about corporate social responsibility. Obviously, this needs

to exist, and we need to promote it. Nevertheless, such responsibility
corresponds to all levels of society. Just as there is a corporate social
responsibility, there must also be responsibility on the part of the
government, universities, NGOs, churches, and society as a whole.
Michael Porter talks about shared value, but as we say in Spanish, “you
don’t get meat without the bone.” Value comes with a social responsibility
that all of us must assume. This is what we at Buenaventura call shared
social responsibility.
And this is only possible with communication and integration among

different social and economic sectors. They say private enterprise
does not communicate well enough. But how are we supposed to
communicate if not through the young people at our universities?
Through the Peruvian Confederation of Private Business Institutions

(CONFIEP) we engage in different dialogue spaces at universities around
the country, sharing our vision, the profile of today’s new Peruvian
enterprise, its contribution to the Sustainable Development Goals, and
the Agenda 2030, among other matters of national interest.
There can be no doubt that we are advancing, but there is still a great
deal to be done. With this goal in mind, we must view enterprise as a
strategic partner for universities.
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RESPONSIBLE MINING
I am convinced that enterprise and higher education must forge close

bonds in regards to not only talent management, but also research and
innovation. New ideas and technology must be a joint effort between
the universities that do the research, and the enterprises that use them.
Universities prepare and promote the talent that then works for
companies and institutions. Education and enterprise complement
one another. For this reason, we must work together to offer the best
education possible, to the benefit of the country.
Thus, we as businesspeople have an obligation to participate in university

forums and closely interact with students and authorities.
I would like to take a moment here to highlight the agreement that was
recently signed between the San Marcos University (UNMSM) and the
Peruvian Confederation of Private Business Institutions (CONFIEP) which
establishes a series of guidelines aimed at reinforcing the university’s
research projects through exchange and cooperation programs.
This initiative is centered on five lines of action: innovation,

entrepreneurship, research, extension education, and social
responsibility. These pillars will allow us to bolster the relationship
between academia and the business class. The agreement is also
articulated with the university’s “1551 Business Incubator.”
I want you to know that private companies are extremely interested in

discovering talented students and supporting programs such as these.
You can be sure that we will continue searching out these types of
opportunities, because in the end, we are all Peruvians and we all want
progress and a better future.
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the mining industry
Private enterprise, too, has evolved. Today, modern Peruvian enterprise

is a formal economic unit that creates jobs, obeys the law, participates
actively in local development issues, forges commitments through
strategic alliances with its peers or the communities where it operates,
and stresses its integration with the world.
I want to emphasize something that I mentioned earlier, which is that

we in the private sector have aligned ourselves with the Sustainable
Development Goals approved in the United Nations General Assembly
held on September 25, 2015. These goals seek to eradicate poverty
through economic development, protect the planet, and guarantee
prosperity for all through social development.
Social development and care for the environment must be tied to

economic development in order to make these processes sustainable.
Those who seek to address these three aspects separately are making a
mistake. It is our obligation to work toward true sustainable development.
Our alliance with the United Nations began in 2004, when the Peruvian
Confederation of Private Business Institutions (CONFIEP) became the
Technical Secretariat of the United Nations Global Compact. Since then,
we have promoted these universal principles for entrepreneurial action,
in line with issues such as human and labor rights, the environment, and
the fight against corruption, among others.
Today, over 100 Peruvian companies have voluntarily adhered to this

compact, and are now contributing through our actions and business
commitments to the sustainable development of our planet.
The pending agenda in Peru

Peru has enormous potential. We cannot turn our backs on the
highlands or the jungle, nor on rural Peru, where most of our country’s
poverty is concentrated. We must provide opportunities for progress
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RESPONSIBLE MINING
to all regions by making the most of their mineral, agricultural, fishing,

and tourism resources, among others. We must do away with the
centralist bureaucracy that is suffocating the country. As we often say,
“God is Peruvian, but you have to go to Lima to find Him.” This must
change.
While us as Peruvians—and I am talking here about authorities,

businesspeople, academics, and society as a whole—are working to
sustain our economic growth, we must also stress the need to move
forward with second-generation institutional reforms. This is especially
important if Peru is to meet the standards of the member countries of
the Organization for Economic Cooperation and Development (OECD).
In this regard, we at the Peruvian Confederation of Private Business

Institutions (CONFIEP) have highlighted the importance of achieving
strong institutions, promoting competitiveness, and improving our
current production levels.
The institutionality agenda in Peru must undertake a comprehensive

political reform to guarantee transparent, internally democratic
organizations; a meritocratic civil service; and a State under the rule of
law where all citizens, without exception, obey the rules.
All of us must participate in our country’s politics, which is a

fundamental aspect for any society. We must offer comments and
make contributions to the benefit of society as a whole.
Aristotle remarked that “man is a political animal.” Haya de la Torre, the

most illustrious Peruvian politician of the 20th century and a graduate
of San Marcos added, “and if he is not political, then he is simply an
animal.” We are all a part of our country’s politics, and we demand that
our politicians serve us, and not the other way around. Haya de la Torre
infused Peruvian politics with didacticism and decency, and we must
learn from figures like him if we are to make Peru a better place.
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the mining industry
As a result of the failure to make progress with many of the pending

reforms in recent years, we have observed a series of difficulties and
gaps with economic and social impacts. These include informality,
centralism, and corruption. These are the three endemic ills against
which all Peruvians must fight.
According to the National Institute of Statistics and Informatics (INEI)

informal jobs not only account for nearly 70 percent of the workforce,
but informality was reduced by just seven percentage points between
2007 and 2015. According to the Peruvian Ombudsman’s Office, on the
other hand, annual losses due to corruption total over 12 billion soles,
nearly double the annual budget allocated for social welfare. And these
are just a few examples.
Addressing this problem is not just an issue for authorities from the
three branches of government. We must carry out a national crusade,
in which all actors of Peruvian society are active participants. No
one should remain standing on the sidelines when it comes to Peru’s
national interests.
But let us be optimistic! Over the last 25 years, Peru has experienced
sustained economic growth within a framework of legal and
macroeconomic stability, which has helped reduce poverty and
provide millions of Peruvians with access to different opportunities
and improved basic services.
Obviously, this is a complex task and it is not finished yet, but we have
laid a solid foundation that instills us with confidence as we turn to look
at Peru’s present and future.
I would now like to take this opportunity to talk a little bit about
the contributions made to the Peruvian economy by formal mining
activities.
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RESPONSIBLE MINING
Mining: The driving force of development

Mining accounts for over 10 percent of Peru’s GDP, and is the primary
source of hard currency earnings, given that it makes up nearly 60
percent of all Peruvian exports.
According to the Ministry of Energy and Mines (Minem) there are

currently around 50 mining projects, which translates to an investment
of approximately US$ 58.346 billion. Let us remember here that mining
activities are carried out in some of Peru’s most isolated areas, where
other economic activities rarely reach, leading to the true economic
and productive decentralization of our country.
If the mining projects in portfolio were carried out, they would create
2.4 million stable jobs, and tax revenues would increase by over 23
billion per year, according to the IPE.
Additionally, mining development contributes to infrastructure such as

roads, electrification, health centers, schools, and connectivity, which
Peru’s highland residents so desperately need.
No less importantly, there is the issue of water. One of the commitments

assumed by responsible mining is caring for water and ensuring its
quality.
Access to water is a fundamental right of all human beings. We in the

mining sector are convinced that water must be incorporated as a
vital factor in the development of projects in all fields. The key lies in
building dams or reservoirs to store this resource, so that it can be
used not only for mining projects, but by the surrounding populations.
Mining justifies the creation of this infrastructure, and it is not only our
desire, but our duty, to contribute to the nearby communities.
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the mining industry
Peru receives 2 trillion m3 of water per year in rainfall. According to the

National Water Authority (ANA) we as a country consume just 1 percent
of that quantity, and of that 1 percent, agriculture uses 80 percent,
while the population consumes 12 percent. For its part, industry uses 6
percent and mining just 2 percent.
Clearly, Peru has no shortage of water. What we need is the responsible

management of water resources, with a comprehensive, well-thought-
out vision. Basin management is a critical part of water management,
which must be based on criteria of sustainability, and not politics or
ideology.
Mining development in our country must continue to contribute to

economic growth with decentralization and care for the environment,
fostering wellbeing for all, but especially those who live in the high
Andean areas of Peru.
“The most important thing is that mining allows us to integrate as a

country. It justifies the construction of roads, electrification systems,
and schools, and the offering of education programs. Integration is the
best contribution mining could hope to make in a country such as ours,
with its imposing geography, and mining can and must contribute to
this goal” (memoirs of Alberto Benavides de la Quintana).
We must give thanks to our land for giving us the great benefit of our
natural resources. And it is our obligation to make the most of them, to
the benefit of society, and above all, the neediest among us.
It is for this reason that we as Peruvian business owners have a shared

vision. From our viewpoint, it is essential, if we are to move forward
with our sustainable development agenda, that we bring three basic
elements into alignment: economic growth, the social agenda, and the
protection of the environment.
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RESPONSIBLE MINING
I would like to once again express my gratitude to the National Major

University of San Marcos (UNMSM) for honoring me with the Degree
of Doctor Honoris Causa and giving me the chance to speak to you all
today.
Peru is our shared home, and it has everything it needs to become a

developed country. The rest is up to us. More Peruvians must have
access to utilities, health, justice, security, and above all, more values
and better education. If the government, the universities, and private
enterprise work together, we can achieve it all!
Roque Benavides
Lima, October 26, 2017
161
CONCLUSIONS
As we have seen, Peru is a mining country par excellence. Many of its
regions have an enormous potential that, if taken advantage of, will
have an incredible impact on Peru’s citizens, and especially those living
in the high Andes.
We know that mining has historically been a driving force behind our
country’s growth, and that it remains so today. Those who downplay
its ability to integrate and decentralize the country, its ability to forge
production chains, and its major economic, social, environmental, and
labor contributions are refusing to see the facts. They are turning their
backs on progress. We must not let these misguided arguments cause
us to lose or postpone the opportunity to create new opportunities
for the country. Remember that our mineral resources are located in
inhospitable areas where it would be impossible for any industry other
than mining to penetrate.
In light of the foregoing, we must reach a consensus as a society and

assume our respective roles. Private enterprise must follow the path
of entrepreneurship and generate wealth with responsibility. For its
part, the government must establish adequate conditions to promote
investments, overseeing compliance with the law and constantly
providing information to the population. Remember that in rural areas,
it is very difficult to work without the support of local authorities. For
its part, the population must welcome and support the arrival of the
benefits that come with mining, identifying opportunities for joint—
and most importantly, self-managed—development. Only in this way
we will be able to foster the sustainable and inclusive development of
our country. We must assume our shared social responsibility.
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RESPONSIBLE MINING
It is important to bear in mind that when companies and the community

identify shared goals and receive the government’s backing, this
creates greater understanding, shared successes, increased benefits,
and greater care for the environment, while bringing development to
the most underprivileged areas. It has been proven that agricultural
and livestock activities can coexist peacefully with responsible
mining. When mining companies build large reservoirs, they help to
multiply agriculture and livestock activities. Water management is an
issue on which we must continue to work: we believe in an authentic
brotherhood of water.
It should be clear by now that the earnings of the mining sector, which
depend on the efficiency of mining companies and metal prices, are
earnings for Peru. When mining companies’ profits rise, so do the canon
and royalties. The benefits of the mining sector are also reflected in
formal jobs, new roads and communication infrastructure, dams and
reservoirs, electricity generation, schools, hospitals, and more.
We are a fortunate country with immense resources and very talented

people. All of this needs to be recognized, valued, fostered, and shared
so that responsible mining’s positive impact on Peru’s development
continues to increase. At Compañía de Minas Buenaventura, which was
founded in 1953, we have been working for over 65 years to share and
do our part in achieving this objective, for the good of all Peruvians.
The challenge is clear: we must make the most of our natural resources
so we can help drive the development of Peru!
Roque Benavides
Lima. July, 2018
163
Responsible mining and its contribution to the development of Peru
Third edition, February, 2019
Author:
Roque Benavides
Chairman of the Board of Compañía de Minas Buenaventura S.A.A.
Edited by:
Compañía de Minas Buenaventura S.A.A.
Calle Las Begonias 415, Piso 19, San Isidro, Lima, Peru
Editor:
Diego Uceda
Proofreaders and style checkers:

Mariana Hilbck
Diana Lara
Design and layout:

N Comunicaciones S.A.C.
Prepress and printing:

Comunica 2 S.A.C.
Calle Omicrón 218, Urb. Parque Internacional de Industria y Comercio
Callao 1, Peru - February, 2019
Legal deposit made with the Biblioteca Nacional del Peru under
number 2019-02199 / Hecho el depósito legal en la Biblioteca Nacional
del Perú Nº 2019-02199
All rights reserved. All articles, photographs, and figures appearing in

this publication may be reproduced in full or in part, using any electronic
and mechanical means or procedure, photocopy, recording, etc., and
distributed via public loan, solely with the written authorization of the
copyright holders.
164
Roque Benavides developed his profes-
sional career in Compañía de Minas
Buenaventura S.A.A. since 1977. He
began working as Project Engineer, then
as Chairman Assistant, and later, in 1985,
as Finance and Administration Manager.
Appointed CEO in 2001, and Board
member since 2003. In 2011 he assumed
the position of Chairman of the Board of
Directors.
Civil Engineer by Pontificia Universidad

Católica del Perú (PUCP), and MBA by
Henley Business School at the University
of Reading, UK. He successfully comple-
ted the Program for Management
Development at Harvard Business
School, and the Advanced Management
Program at Oxford University. In 2017 he
was awarded Doctor Honoris Causa by
the Major National University of San
Marcos, and in 2011 he received the
Palmas Magisteriales in the degree of
Amauta and the Orden del Trabajo in the
degree of Grand Officer by the Peruvian
government.
He served as President of the National

Society of Mining, Petroleum and Energy
(SNMPE), and currently he is the
President of the Peruvian Confederation
of Private Business Institutions (Confiep).

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Roque Benavides developed his profes-

sional career in Compañía de Minas

Civil Engineer by Pontiﬁcia Universidad

He served as President of the National

1. OVERVIEW OF THE MINING SECTOR 12

2. MINING REGIONS OF PERU 32

5. RESPONSIBLE WATER MANAGEMENT 98

7. WORKING TOWARDS SHARED

8. NEW CHALLENGES FOR

As Chairman of the Board of Buenaventura and the

In this third edition, the author also takes on the role

It is important to point out that Peru is a service economy, and not a

In 2017, Roque Benavides was awarded the degree of Doctor Honoris

Responsible mining and its contribution to the development of Peru

I would like to congratulate Roque Benavides on this new edition of

We ﬁrmly believe that responsible mining is a major factor in our country’s

As a country, we need to acknowledge our failure to properly

Of course, we are making progress in this process of communication

As part of these efforts, we are proud to present the third edition,

It should be noted that of all investment in Peru, 80 percent is private

Peru meets all of the essential conditions for becoming a developed

Currently, mining is the backbone

1.1 MINING AND ITS ROLE IN THE PERUVIAN ECONOMY

Following the Spanish conquest, mining

Over the last 28 years, however, there have been

This has been possible thanks to a number of strengths

Peru’s political and economic stability is rooted in the

1.2 THE VIRTUOUS CIRCLE OF MINING

Peru’s signiﬁcant levels of mining production have been achieved with

Obviously, mining involves work with nonrenewable resources, which

In mining, exploration is equivalent to the research and development

The future of mining and of

1.3 NATIONAL GDP AND MINING GDP

The oft-repeated criticism is that Peru’s economy is primary/export-

However, as the economist Juan José Garrido Koechlin explained

The Peruvian socioeconomic context 2017

Peru Lima Regions

Source: INEI, 2017

According to a study by the Ministry of Energy and Mines (Minem) mining

It is worthwhile to take a look at mining’s GDP percentage in other mining

GDP growth and world mining GDP 2017

Country GDP growth Mining GDP

(1) Includes mining, oil and gas

(2) Information at the close of 2016

Source: INEI, 2017

There can be no doubt that poverty is mainly to be found outside the

The mining sector has a major impact on the country’s macroeconomic

The mining sector in Peru 2017

10% of national GDP

Source: INEI, 2017

1.4 MINING PRODUCTION

Over the last decade, Peru’s production of gold, silver,

Mining companies must contribute to this growth

The communities in the high Andes of Peru, where most

The government, too, must do its part to speed up

1.5 MINING POTENTIAL

Peru possesses enormous mining potential in its high Andean areas,

Peru in the world mining potential ranking

TOTAL 720 100% TOTAL 1,772.9 100%

CHILE 210 29.2% AUSTRALIA 295.5 16.7%

TOTAL 17,729 100% TOTAL 226.3 100%

PERU 3,284 18.5% AUSTRALIA 63.0 27.8%

TOTAL 88,000 100% TOTAL 16.658 100%