Peru’s Mining Future: Beyond Short-Term Gains to Secure a 2035 Advantage

Peru’s mining sector is currently enjoying a financial boom, with key players outperforming global averages in metrics like EBITDA growth. But a critical question looms: is this success built on a foundation of sustainable long-term vision, or simply a rush to extract maximum value in the short term? A recent PWC report, “Mine 2025,” reveals a concerning trend – while investment in fixed assets is rising, exploration spending is declining, signaling a potential future shortfall in securing the minerals needed to meet global demands.

The Seven Megatrends Shaping Mining to 2035

The PWC report identifies seven “megatrends” poised to redefine the mining landscape by 2035: population growth and urbanization, the energy transition, environmental impact, technological innovation, human capital, new financing sources, and political/regulatory evolution. Leading mining companies worldwide are already factoring these trends into their strategic planning, proactively assessing their mineral needs and forging public-private partnerships to ensure supply. However, this forward-thinking approach appears to be largely absent in the operations of these same companies within Peru.

“Among the 40 main miners in the world, they are already contemplating the intern how to respond with their minerals to the demand in each of those areas,” explains Pablo Saravia, leading mining partner of PWC Peru. “In their annual memories they already rescue the projections of what they need to do to ensure the supply of minerals.” The disconnect lies in the fact that these projections aren’t being applied to Peruvian operations, suggesting a lack of commitment to long-term investment in the country’s mining future.

The Political Climate and Investment Hesitation

Adding to the concern is the cautious approach of investors, fueled by Peru’s upcoming 2026 presidential elections. Miguel Incháustegui, former Minister of Energy and Mines, notes that companies are hesitant to commit to large-scale investments until the political landscape becomes clearer. This caution is compounded by the ongoing challenges posed by illegal mining, exemplified by cases like the Pataz mining company, which further discourages long-term planning.

Did you know? Illegal mining in Peru not only poses environmental and social risks but also undermines legitimate investment and hinders sustainable development.

Copper and Gold: Current Strengths, Future Vulnerabilities

Currently, copper and gold dominate Peru’s mining exports. In 2024, copper accounted for 49.1% of total exports ($23.405 billion), followed by gold at 32.4% ($15.468 billion). These two minerals represent 57% of the income generated by the 13 mining companies analyzed by PWC. While Peru possesses significant geological advantages in these resources, relying heavily on them isn’t a sustainable strategy.

The Lithium Opportunity – and the Barriers to Entry

The energy transition is driving demand for critical minerals like lithium, and Peru has the potential to become a significant player in this market. However, bureaucratic hurdles and a lack of facilitating legislation are hindering the development of lithium projects, leaving opportunities to neighboring countries like Chile and Argentina. This highlights a critical need for regulatory reform to attract investment and unlock Peru’s lithium potential.

Decapitalization Concerns and the Polymetallic Advantage

Despite strong financial performance, there are concerns that the mining industry in Peru is becoming “decapitalized.” Increased dividends, while benefiting shareholders, may be diverting funds away from crucial exploration and development activities. However, Peru’s diverse mineral resources – its “polymetallic” nature – offer a degree of resilience. The commercial war between China and the United States, for example, may impact copper demand, but Peru’s reserves of silver, zinc, and lead provide diversification and attract investment from multiple countries.

Incháustegui points to opportunities in silver, noting its rising price and potential for growth. “There are also others in zinc or lead that profile interesting,” he adds, suggesting a broader portfolio approach to mining investment.

The Need for a Shift in Strategy: From Extraction to Exploration

The PWC report underscores a critical need for Peruvian miners to prioritize exploration and expand their project portfolios. Simply maximizing short-term extraction is not a viable long-term strategy. Investing in exploration is essential to ensure a sustainable supply of minerals to meet future global demands. This requires a collaborative effort between the government, private sector, and local communities.

See our guide on sustainable mining practices for more information on responsible resource development.

Investing in Innovation and Technology

Beyond exploration, embracing technological innovation and automation will be crucial for enhancing efficiency, reducing environmental impact, and attracting skilled labor. Investing in technologies like AI-powered geological modeling, remote sensing, and automated mining equipment can significantly improve operational performance and competitiveness.

Frequently Asked Questions

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