Compania Minera Antamina
MIGA insured both equity and debt investments in one of the largest new mining projects in Peru, the Antamina copper-zinc mine in the Cordillera Blanca range of the Andes. MIGA issued $67.5 million of coverage for equity investments by three Canadian mining companies, Rio Algom Limited, Noranda Inc. and Teck Corporation, and senior loans by Citibank N.A., leading a consortium of commercial banks. The equity investments are covered against the risk of transfer restriction and the loans are covered against the risks of transfer restriction, expropriation and war and civil disturbance.
The $2 billion investment will have far-reaching impacts on the local economy. It is expected to significantly increase Peruvian mining exports.
The development of the mine will significantly improve the infrastructure of this Andean region. A modern port facility will be built on unproductive land close to the town of Huarmey. The Antamina deposit is located in a rural Andean region, at an elevation of about 4,300 meters. The construction of roads will better link Peru's highlands to the port, which should foster local commerce and attract future investments. The project will pay substantial annual taxes to the government and will have a major impact on Peru's trade balance.
The project involves the purchase of significant amounts of local goods and services, which will provide a boost for many domestic companies. Antamina will employ about 6,000 Peruvian nationals during construction and operation. The workers will be given many benefits, including a mortgage subsidy program for staff housing in the nearby town of Huaraz. It is estimated that for each person hired directly or indirectly by Antamina, five new jobs will be created. In order to assist families and others in surrounding communities, Compania Minera Antamina will implement a Community Development Plan that includes support for educational, economic, and cultural activities.