en +5411 4346-1000
·
info@eof.com.ar

Mining business opportunities

26 October, 2022

Mining business opportunities – Highlights

Argentina mining resources: key investment fundamentals

♦  Proven large reserve of minerals and increasing demand as the result of the energy transition and geopolitical changes: lithium (worldwide 2nd reserves and 4th producer; total identified resources: 70 Mt eq. Lithium carbonate), copper (reserves exceeding 60 M tons), silver (10th on The Silver Institute´s list), gold (South America 4th producer), aluminium, zinc,
borates, potassium, amongst others.

♦  Potential exploration. 1/3 of Argentina´s continental territory has mineral resources to be exploited. Large regions of the country still not prospected. 

♦  Legal certainty in the granting of mining title, concession and permits with a free-entry system. Sound mining legal system, granting sine die
exploration and exploitation concessions by provincial authorities, subject to the compliance of conservation conditions, such as payment of royalties, capital investment and exploitation.

♦  National law 24,196 provides tax benefits for mining and service providers companies: 1) a 30-years tax stability period, 2) 0% tax on capital and material imports, 3) double Income Tax deduction of exploration expenditures, 4) 3-years accelerated depreciation, 5) 3% cap for royalties, 6) reimbursement of VAT paid in exploration activities.

♦  Decrees 234/21 and 836/21 – issued by the Federal Executive Branch as with the same hierarchy as law passed by the Argentine Congress- guarantee -via an Export Investment Certificate- access to foreign currency up to 60% of the exports for: 1) payment of loans abroad, and 2) dividends resulting from closed and audited financial statements and, 3) exchange
rate stability for a 15-year period, 4) repatriation of non-residents’ direct investments, in the following terms:

» Direct investment between U$S100 and 500 million, up to 20% of the exports or 25% direct investment entered via the Foreign Exchange
Market, the lower.

» Direct investment between U$S500 and 1000 million, up to 40%.

» Direct investment exceeding U$S1000 million, up to 60%.

♦  Strong political commitment by mining provinces which own the mineral reserves, to develop and exploit the resources in a sustainable manner.

♦  No restrictions regarding foreign investments and ownership of mineral resources.

♦  World class renewable resource (solar and wind) to supply electricity to mining projects.

♦  Argentinean Geological Survey (SEGEMAR) is a government technical agency within the National Secretariat of Mining that provides public available information resources as regards to the geological, topographic, and metallogenic maps of the country with information on its mineral resources.

♦  Environmental worldwide state of the art requirements through Environmental Impact Assessment before the provincial authority to obtain
Environmental Impact Declaration. Updates shall be submitted every two or upon changes in the activities informed.

O´Farrell and mining: our team and knowledge.