Canadian mining projects move ahead in Argentina

Tue Jan 10, 2012 5:41pm EST
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By Karina Grazina

BUENOS AIRES (Reuters) - Argentina expects two Canadian miners, Pan American Silver and Goldcorp, to start construction on sizeable projects over the next six months as the sector continues to expand, the country's mining secretary said on Tuesday.

High metals prices and legal reforms in the 1990s have spurred rapid growth in Argentina's mining industry since 2003, although it still lags far behind regional heavyweights such as Chile and Peru.

Argentine Mining Secretary Jorge Mayoral told Reuters in an interview that Pan American Silver PAA.TO could start construction before June on its Navidad silver project, which he said would require an investment of at least $1 billion.

"This is one of the most important metals projects to be carried out in the Southern Cone. It is in the last stages of exploratory development, they are defining reserves and doing feasibility (studies)," Mayoral said.

"I think we may be able to make an announcement on the investment in this project before June and construction would start almost immediately," he added.

Navidad is located in the Patagonian province of Chubut and is being developed by Minera Argenta, a Pan American subsidiary.

Last year, the company questioned the economic impact of Chubut's laws prohibiting open-pit mining and the use of cyanide in mineral processing. But the firm later said it would avoid cyanide and expected Navidad to be in the permitting stage by 2012, with production seen in mid- to late 2014.

The company expects to produce nearly 20 million ounces of silver a year at Navidad in the first five years of operations.   Continued...