Juan-José Zentner and Michael D’Agostino, Herbert Smith Freehills, USA, discuss the outlook for mining projects in Latin America, and identify emerging themes, new players and key challenges facing the sector in 2019.
After a largely stagnant 2018 due to China-US trade tensions and falling commodity prices in 3Q18, miners in Latin America are looking to 2019 with cautious optimism. After reducing debt levels over the past few years, the primary focus of miners is returning value to shareholders – although stabilising copper, gold, silver and zinc prices will provide potential for capital to be allocated to brownfield expansions and select new greenfield projects.
Miners will also be seeking a more robust risk transfer to those contractors engaged on capital projects, and the increased involvement of private equity and generalist investors will potentially bring new ideas to bridge CAPEX gaps and plug funding shortages.
This article was first published in the April edition of the Global Mining Review magazine.
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© Herbert Smith Freehills 2019