Peru’s major miners fear loss of exploration rights amid proposed law changes

Peru’s large mining companies, including BHP and Glencore, warn that proposed reforms to mineral concessions could threaten long-term investments as lawmakers push to favor small-scale miners.

Peru’s major mining companies are sounding the alarm over potential changes to the country’s mineral rights framework, as lawmakers prepare to debate a bill that could overhaul how concessions are granted and maintained.

The proposed legislation, aimed at promoting small-scale and artisanal mining, has raised fears among global mining giants such as BHP Group, Glencore Plc, and Anglo American Plc, which rely on long-term exploration rights to develop large, capital-intensive operations.

Lawmakers target “idle” concessions

Peru, the world’s third-largest copper producer and top gold exporter in South America, currently grants mining concessions that allow companies to explore vast tracts of land for decades before production begins. However, a surge in illegal mining and project delays has spurred some legislators to call for shorter-term licenses that prioritize smaller operators capable of rapid development.

President Dina Boluarte acknowledged during the closing ceremony of last week’s Perumin conference that her administration had submitted proposals to Congress, including “changes to the concessions regime,” though she did not specify details.

Congress is now reviewing bills intended to formalize small-scale miners and potentially revoke concessions deemed “idle” or “underutilized.” While it remains uncertain whether these measures will pass, the issue is expected to feature prominently in next year’s presidential and legislative elections.

Industry fears investment chill

Mining executives argue that shortening concession periods or penalizing projects still in the exploration stage could severely undermine investment in a country where environmental permitting and community negotiations already take years.

“It takes about 40 years to start production at a mine in Peru,” said Carlos Gallardo, general manager at the Peruvian Institute of Economics (IPE). “Cutting concession timeframes to 10 years is nonsense—it would only discourage large-scale, formal mining investment.”

The IPE recently published a study commissioned by the Peruvian Institute of Mining Engineers, stressing that proposals to revoke long-term concessions “ignore the reality of the sector.” The report found that regulatory bottlenecks and complex approval processes are the real reasons for slow project development, not speculative land-holding.

Illegal mining adds fuel to the debate

Illegal mining remains one of the country’s biggest challenges. IPE estimates that illegal gold exports could reach $12 billion in 2025, while roughly $7 billion in copper projects are currently stalled due to invasions by illegal miners. Those include Southern Copper’s Michiquillay and Los Chancas projects and First Quantum’s Haquira deposit.

Analyst Ivan Arenas, who advises mining firms on social conflict management, said misinformation is being used to justify seizing private concessions. “Illegal miners are making up lies to legitimize taking over third parties’ concessions that aren’t theirs—and their message is starting to stick,” he warned.

No political consensus in sight

Despite the heated debate, there appears to be no clear consensus in Congress. José Farfán, legal adviser for Anplaben, a group representing ore-processing plants, said the discussion may ultimately stall. “There is no consensus right now in Congress,” he said. “It’s a taboo subject.”

For now, Peru’s mining giants are left in limbo—caught between mounting political pressure to formalize the artisanal sector and the long-term security their billion-dollar projects require.