Why Argentina?

Argentina is a country of over 2 million square kilometres displaying a variety of geological environments from the high Andean Cordillera bordering Chile on the west to the flat Patagonia of the south and the rich Pampa of Buenos Aires province. Well-known for its agriculture and wine-growing, this country of 38 million people has a robust manufacturing sector, good infrastructure, and a well-educated population.

In recent years Argentina has experienced rapid recovery after the devaluation of its currency in 2001. Today a stable economy is growing at rates of 8-10% per year, and the country now attracts substantial foreign investment in all sectors.  In 2005, investment in new mining activities reached over US$800 million and is expected to continue at a high rate for the foreseeable future.  Currently there are almost 200 mineral exploration projects in the country, many of which are operated and funded by North American public companies. The principal targets are gold, silver, copper and lead-zinc.  However, Argentina is also host to widespread uranium occurrences in several provinces including La Rioja.  The recent increase in prices for all energy related commodities has acted as a catalyst for the renewed interest in uranium resources. 

Interest in mining in Argentina has increased rapidly over the past 10-12 years with several major mining operations now successfully underway (Vanguardia, Bajo de la Alumbrera, and Veladero).  In addition there are other significant deposits such as the Navidad silver base metal project in the Province of Chubut, Gualcamayo gold deposit in the Province of San Juan and the huge Agua Rica porphyry copper project in the Province of Catamarca all of which will eventually be developed.

The local mining industry received a great impetus from the substantial changes to the Mining Code implemented in the 1990s by the Federal Department of Mines under the leadership of Dr. Angel Eduardo Maza.  Governor Maza, who received his professional training as a geologist, is now successfully serving his third 4-year term as Governor of the Province of La Rioja. Like many of the neighbouring provinces, La Rioja is now committed to an environmentally conscientious and sustainable policy of developing its abundant mineral resources.

Some of the incentives by the Mining Investments Act instituted in 1993 by the Federal Government of Argentina include: guaranteed tax stability for a 30 year period, 100% deduction of exploration costs from income taxes, exemption from import duties on capital goods, equipment and raw materials used in mining and accelerated amortization of investments in infrastructure, machinery and equipment.  In addition, while most of the provinces of Argentina have a standardized 3% provincial royalty on the “mine mouth” value of production, La Rioja, under the leadership of Governor Maza has so far opted to waive this royalty. 

All in all, with geology conducive to host large mineral deposits, favourable tax regimes, and now very competitive exploration costs, Argentina and more specifically, the province of La Rioja is poised to become a major player in the world wide search for new mineral resources.