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Peru lines up $34bn in infrastructure, mining projects

Staff writer |
Peru is expected to invest $33.8bn in 229 infrastructure, energy and mining projects over the next two and a half years, according to the central bank.

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Companies have earmarked $4.28bn for infrastructure projects including the southern natural gas pipeline, line No. 2 of the Lima metro, the ports of Chancay and Callao's Muelle Norte, the Lima and Chinchero airports, and the longitudinal highway, the bank said in a quarterly report.

A total of 34 mining projects with $9.98bn in investments include expansions at the Toquepala, Toromocho and Hierro Perú mines;Jinzhao Mining's Pampa del Pongo; AQM Copper's Zafranal, and Buenaventura's Tambomayo, the bank said.

Hydrocarbons (18), electricity (34) and manufacturing industry (12) investment projects total $5.17bn and $3.92bn, respectively.

The largest projects feature the expansions of La Pampilla and Talara oil refineries, and the Cerro del Aguila and Chaglla hydroelectric plants, the bank said.

Mining GDP is expected to expand 14% this year and 8.3% in 2017, while manufacturing should rebound 4% next year after contracting 1.8% in 2016, according to the report.

Construction activity will remain flat this year before growing 3.5% in 2017, the bank said.

The bank estimated Peru's copper production at 2.25Mt this year and 2.54Mt in 2017, as Freeport-McMoRan, China Minmetals, Chinalco and Hudbay Minerals ramp up production, and Glencore, Antamina and Southern Copper boost output.

Gold output is set to drop to 4.16Moz next year from 4.53Moz this year on declines at mines operated by Newmont Mining and Barrick Gold.

In other infrastructure news, construction work is to get underway next year on a new entrance to Lima's Jorge Chávez airport in 2019, deputy transport minister Henry Zaira said.

Access to the country's largest airport will be via a four-lane bypass from Santa Rosa avenue, which will be linked to the Costa Verde coastal road by 2019, easing traffic on Javier Prado and Elmer Faucett avenues, Zaira told state news agency Andina.

The ministry has started work on a feasibility study for the 15-month project, which will require approval from the finance ministry, he said.

The new entrance to the airport is designed to be ready by the time Lima Airport Partners finishes work on a $1bn expansion of the terminal, according to the ministry

The expansion program, which involves a second passenger terminal and runway, aims to enable the airport to handle 30mn/y passengers by 2031 from 26mn last year.

LAP, which is controlled by Germany's Fraport (70%), World Bank subsidiary IFC (20%) and investment fund AC Capitales SAFI (10%), took over the airport from state airport authority Córpac in 2001.

While President Ollanta Humala's government has awarded a record $20bn in public-private infrastructure concessions since 2011, tens of billions of dollars in infrastructure, mining and energy projects have been held up by permitting delays, according to industry associations such as Confiep and AFIN.

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