Nadia Ricci, head of the Santa Cruz Provincial Secretariat of Mining, highlighted the significant contribution of the precious metals sector in exports, employment, and local development.
By Panorama Minero
The mining industry in Santa Cruz is approaching its 30th anniversary. What conclusions can be drawn from this journey?
Undoubtedly, the Province of Santa Cruz has seen the most development in mining activities since the enactment of the Mining Investment Law, especially in the first-category mining sector—gold and silver. The first project, Cerro Vanguardia, has been in operation for over 25 years, where ore is extracted, processed, and doré is produced for export. Today, six companies are operating similarly in the province: Cerro Vanguardia, San José, Cerro Negro, Cerro Moro, Don Nicolás, and Patagonia Gold. These operations include underground mining, open pits, mineral processing plants with water reuse, water and cyanide management, and heap leaching. Each of these operations has positioned the province as the leading producer and exporter of gold and silver in the country.
On the other hand, we must also mention YCRT (a national company) involved in coal production, which represents a significant challenge at this time.
On a smaller scale, our province has clay mines considered the best quality in the country for ceramic products.
The authority responsible for this sector has grown alongside the mining activity, facing the challenges of a complex economic activity that has not been effectively supported by a strategic territorial development policy. This policy should ensure that the finite resources generated by this activity lead to the creation of sustainable and enduring alternatives in each region.
What does mining mean for the economy of Santa Cruz, and how many people does it employ?
Mining is the second-largest source of revenue for the province through royalties. In 2023, production reached nearly 680,000 ounces of gold and 15,227,000 ounces of silver. Mineral exports represent 80% of the province’s total exports, making Santa Cruz the number one province in mining exports, accounting for almost 42% of the country’s total.
Additionally, the province's revenue benefits from the UNIRSE Fund (United in Social Responsibility), in effect since 2016. This public trust fund is dedicated to financing social and health investment programs and projects, public works, acquisition of goods, productive projects, and technological investments that contribute to the sustainable development of the province. All operators contribute to this fund, averaging approximately 1% of sales.
Moreover, each area of influence has a specific agreement, whether it’s a contribution to a development agency like in Puerto San Julián, or a local trust, as seen in Puerto Deseado and Perito Moreno.
Regarding employment, Santa Cruz is the leading province in mining-related jobs, with approximately 9,000 positions, representing 22.5% of total mining employment: one in four mining workers in Argentina is employed in Santa Cruz. Additionally, it is estimated that between one and seven indirect jobs are generated by this activity for every direct job.
Although Santa Cruz has doubled the participation of women in mining employment over the past ten years, it remains one of the industry’s biggest challenges, along with increasing the hiring of local workers from Santa Cruz, including qualified positions.
This new government places special emphasis on benefiting the people of Santa Cruz, not only by controlling the hiring of local labor but also by promoting local companies, fostering the development of provincial suppliers, or forming strategic alliances that provide services and products from Santa Cruz.
What plans are being implemented by the Secretariat of Mining regarding environmental monitoring and care?
This authority serves as a one-stop-shop for those who decide to invest in the Province of Santa Cruz. It encompasses administrative and cadastral functions, ensuring compliance with the Mining Code in the concession of mining licenses, and is also responsible for environmental management under Provincial Law No. 2,792, which designates the Secretariat of Mining as the environmental authority for mining activities.
We are implementing CyMA, a remote environmental monitoring and control system, which is a data collection and analysis tool tailored to the Secretariat’s requirements and the operating mines.
We are the first and only province with a mine closure law. We are currently in the process of closing one of the mines, with the support of Connex, the G7 initiative that offers emerging economies multidisciplinary support related to mining investments. In our case, this involves addressing the environmental, social, and economic aspects outlined in the closure law.
Lastly, in the Health and Environment Committee of our provincial legislature, a bill is pending approval that would also transfer the environmental responsibility for waste generated at mining sites to the Secretariat of Mining. This would complete the Secretariat’s environmental management responsibilities.
Given the aging of some operational centers, is RIGI the key to extending their lifespan?
Our province hopes that RIGI (Large Investment Incentive Regime) will be the incentive to reactivate mining activities. The benefits in terms of tax, customs, and foreign exchange stability for 30 years are crucial for defining investment destinations. Additionally, in the case of exploration for new concessions, we are also working on launching a provincial incentive proposal to attract investment from junior companies.
How active are exploration activities in the Deseado Massif?
Unfortunately, exploration activities in the province have significantly declined in recent years, both for operating mines, whose lifespans are increasingly shortened, and for new explorations. I believe this is due to multiple factors. On the one hand, and primarily due to the country’s macroeconomic situation and instability, which has halted new investments and caused Argentina to lose its competitive edge compared to neighboring countries like Chile, Peru, and Brazil. Furthermore, while gold and silver remain our most valuable resources, in the Deseado Massif, competition from other strategic minerals such as lithium and copper has redirected investments towards the exploration and exploitation of these resources.
Santa Cruz also has yet to explore other minerals, for which we will soon be working on an agreement with Segemar, Inremi, and Fomicruz. The opportunities that could arise from the need for minerals for the energy transition are immense, considering our vast territory, the favorable geography for mining activities, the certainty and predictability of environmental regulations, the broad social license to operate, and the validation of labor agreements, among other factors.
Santa Cruz: “Mining represents 80% of the province’s total exports”
