By Ryan Dube
LIMA, Peru--Investments in Peru's mining sector are expected to
reach a record-high this year despite delays to some large-scale
projects, the National Mining, Oil and Energy Society, or SNMPE,
said Wednesday.
SNMPE President Pedro Martinez said that mining investments are
forecast to total $9 billion in 2012, up from $7.2 billion last
year.
The mining sector is key to Peru's economy. It is a major source
of private-sector investments and tax revenue, while mineral
exports also account for about 60% of Peru's total shipments
abroad.
However mining companies have faced obstacles as they try to
build new mines and expansion projects in one of the world's
biggest producers of copper, gold, silver and zinc. Community
opposition and permitting delays have pushed back the startup of
many projects.
Mr. Martinez told reporters that the impact of those delays will
likely be seen in 2013. "This year, we estimate that [mining
investments] should reach $9 billion," he said. "Investments will
probably fall in 2013, but they could recover in 2014."
In a report Wednesday, Scotiabank Peru said that it expects
mining investments to rise 8% in 2012 to just under $8 billion. The
bank also forecast mining investments to climb next year, rising an
additional 7% to around $8.5 billion.
In the first eight months of 2012, mining investments totaled
$5.07 billion, compared to $4.1 billion in the same period last
year, according to the Mines and Energy Ministry.
Mr. Martinez also said that the private sector is watching to
see what changes the government will make in water rates for mining
companies. The head of Peru's national water agency, Hugo Jara,
said that the government plans to announce in the first half of
2013 new rates for the use of water, newspaper Gestion
reported.
Most of the community opposition to mining in Peru has been
related to concerns about the sector's use of water. Some
companies, such as Newmont Mining Corp. (NEM), have said they will
ensure the water supply to local residents by building reservoirs
before starting mining operations at new projects.
"There have been a lot of declarations from many companies about
prioritizing this issue," Mr. Martinez said. "I think it is a good
solution."
Write to Ryan Dube at ryan.dube@dowjones.com
Subscribe to WSJ: http://online.wsj.com?mod=djnwires