Daniel Meilán – “Argentina reached the 11th position in the ranking of exploration investments”

Versión español

The Secretary of Minery of the Nation talked to Energy in Movement and gave a detailed insight into the mining sector at the present time and in the years to come. He also explained what the New Federal Mining Agreement will be like and asked to move away from any reductionism to think about an environmentally friendly extractive activity.

 It’s about a year since the exemption of tax deductions in the mining field. What were the results of this policy?

 This exemption was a positive sign for investors and Argentina has become the focus of attention once again. We’ve been on official missions in Australia, Canada, China, Japan, Chile and Peru and explained the new Argentine situation. We highlighted the importance of guiding investments towards forward-looking and exploratory stages, a must to achieve productive development in the long term. So far, this external work has brought about some results: although mining activity is globally restricted because of the current prices of the commodities, 30 new companies came into our country and settled in different provinces during 2016 to develop exploratory tasks. According to Standard &Poor ranking, in 2016 Argentina reached the 11th position in the ranking of investments in explorations with 140 millions of dollars (it was in 17th position in 2014).

 The government has proposed a mining policy up to 2015. What are your main goals and steps to follow?

The priority will be institutional recomposition that is the essential framework which will allow the State to provide the different actors involved in this activity, with satisfactory answers. These actors are the owners of this resource, the companies, the unions and mainly the local and regional communities . We think that dialogue and federal consensus are and will go on being the only possible way of strengthening institutional relationships between nation and provinces .The Federal Mining Council (COFEMIN) was the governing board that made this dialogue possible. Within this context , it was agreed that a Federal State Policy should be put into practice again . It should unify, homogenize and streamline the legal, economic, financial, environmental and social tools in accordance with a better New Federal Mining Agreement than the current one as for its terms, conditions and arrangements. This Agreement is meant to regulate mining activity for the next 30 years and will be endorsed by the National State, represented by the President of the Nation, and the governors of the different provincial jurisdictions. This whole context foresees a smooth interaction among the Federal Councils of Mining and Environment. On the other hand, the Nation looks forward to playing the role of articulators and promoters so as to be able to carry out each of the programmes proposed by the Agreement.

 How many projects are certain to pass on to the extractive stage ?

The projects that are expected to become active in a short or medium term are: a. Pirquitas (exhausted ) with Chinchillas (Silver), a 30-km away project (Jujuy) (2017-2018) b. Pórfido de Taca Taca (Copper), mega-enterprise ,Salta (2018-2019) c. Lindero (Gold), Salta (2017-2018) d. Cerro Moro (Gold), Santa Cruz (under construction) e. Don Nicolás (Gold), Santa Cruz (under construction) f. Sales de Jujuy (Lithium) (Goldcopper,JEMSE and Toyota) g. Cauchari-Olaroz of Minera Exar (Lithium) (Lithium Americas, Mitsibishi, SQM and Ganfeng Lithium) h. Sal de vida Litio (Galaxy Resources and Sal de Vida Korea) i. Salar del Rincón Litio (Energy and Ady Resources) Besides, Argentina has 4 feasible megaprojects: – Taca Taca : by the end of 2018-2019, construction is started. (First Quantum) – Agua Rica : depends on the future of Alumbrera and/or an independent enterprise . – Navidad: about to start but the development of metalliferous open-pit mines has not been allowed in Chubut province up to now. The National State is working out an agreement with the province to restart mining development. – Pachón : the company Glencore has not set time for the developmkent of the Project. On the other hand, Mendoza has a number of projects of the porphyry type in their exploration stage and the national government is working to agree with the province on resuming mining activities , as it is also the case with the province of Chubut. The deposit of Constelación is close to becoming prefeasible. It’s the most important project in South America, it’s binational (Chile-Argentina) and is developing towards feasibility. So as to spur the growth of this sector, Argentina has programmed a number of investments focused on infrastructure and energy related to minery and other regional activities like the railways in the North East , in the New Cuyo . in the Centre and Patagonia as well. There are also projects of reneweable energy generation put out to tender and , at the same time, the construction of energetic infrastructure is starting, like the dams of Santa Cruz.

What’s your opinion about having a stronger presence on the part of the Argentine state in this activity through a company like “Fiscal Mining Deposits“?

I’ve always stated that the State’s priority should be the granting, care and audit of mineral resources and should also look after the community’s interests . The participation of the state would mean wearing two hats : one as a coordinator and articulator of national mining policy and the other as businessman. This double role could lead to discretional behaviour that should be avoided. But I do support that the national private capital should play a more participative role in the mining development and associated infrastructure.

An activity dealt with care 00 How do you plan to expand this activity despite the feelings of unease that it arises?

Working on restoring reliability and trust. The Nation’s aim is to reach consensus between the actors and revert this situation .It’s time for Argentina to mature and overcome polarization existing in minery as well as work together to have a mining industry capable of, like any other productive activity, providing society with opportunities, quality jobs and development of the communities. Our aim is to build up a balanced state, listen to all the parts, learn from the mistakes and flaws of the past and overcome them altogether. We’re deeply convinced that minery can be developed in a responsible , transparent way and in harmony with the environment. We believe its role is essential in the development of a fairer, more egalitarian and descentralized country. In short, a real federal country. Other countries have achieved this. Why not us ? This conviction is firmly rooted in the main points clearly stated by the President: fight poverty and unite Argentine people . Let’s move away from the reductionism that claims that environment concern and minery are incompatible. It’s not one thing or the other, they’re both : the environment is everybody’s house and the state’s responsibility is to guarantee the full compliance with the laws to preserve it. But it also should set up the necessary conditions to attract mining investments that could entail more jobs and opportunities for all the population, especially those who have been historically left behind.

How are these companies in charge of exploiting deposits controlled?

 The National Constitution makes it clear that the provinces are the ones responsible for the environmental control of these mining enterprises (closure stage included ) Anyway, the Secretary of Mining of the Nation , within the frame of the New Federal Mining Decree, has introduced several measures intended to improve the Nation- Provinces interaction as regards the environment. In this way, the creation of an executive committee of support , consultancy and assistance is encouraged as for the environment. There is also a specific area within the Secretary in charge of the design and proposal of a better practice and assistance to the provinces from the point of view of environment and community. Moreover,specific agreements of technical assistance with the provinces for different mine closures are being underwritten , among other proposals. Besides, the Secretary of Minery and Argentine Geological Mining Service (SEGEMAR) is working on the remediation of environmental liabilities through the GEAMIN programme (In Abra Pampa, San Antonio Oeste, Rio Negro and Calingasta, San Juan). Basic geological information is generated , including geoenvironmental data and a cadastral system on mining liabilities which stand ready to be provided to the provinces for the better control of the possible mining impacts.

 Is it known for certain what really happened with the spils in Veladero mine? What’s the State’s role in this kind of accidents?

 As I have explained above, although it is the provinces’responsibility , the minister Aranguren and the governor Uñac agreed on a joint decision that determined that the company should have to do a thorough re-engineering of its process and social and community development. And this should be subject to a comprehensive audit carried out by reknown bodies as well as national and international experts . Until this plan is duly validated, the leaching activities in Veladero mine will be halted without any interference with the work and salaries of its workers at all. Although the company has claimed that the spill poses no threat to the population or environment, it has accepted the conditions laid down by national and provincial authorities and committed itself to the elaboration of the already mentioned comprehensive plan.