South African miner Gold Fields has increased the initial investment on its Chucapaca gold project in Peru to $1.2 billion from $750 million, confident the gold project will receive the necessary support of nearby communities, social action groups as well as government related procedures in securing regulatory permits amid earlier misfortunes experienced by other firms of other Peruvian mining projects.
"It's a project that will require a substantial investment of resources ... $1.2 billion initially and then $300 to $400 million during the mine's life to maintain operations," Juan Luis Kruger, Vice President of Gold Fields, said in Reuters News. Gold Fields is developing the Chucapaca gold project with Buenaventura, Peru's top precious metals miner.
Latest estimates showed the Chucapaca gold project now holds mineral resources at 7.6 million ounces of gold equivalent from an earlier 5.6 million ounces.
Kruger noted they expect the Chucapaca gold project to go online by end 2015, but depending on negotiations with the communities involved, as well as the process entailed to release the necessary regulatory permits.
Gold Fields, the world's No. 4 gold producer, will submit by the second half of 2012 the environmental impact study for the gold project, including the completed feasibility study.
"Hopefully Chucapaca can become an emblematic project for mining development in Peru, in a context where we see too much pressure against the development of new projects," Kruger said.
Gold Fields holds an attributable annualised production of 3.5 million gold equivalent ounces from eight operating mines in Australia, Ghana, Peru and South Africa, according to its website. It has an extensive and diverse global growth pipeline with four major projects in resource development and feasibility, with construction decisions expected in the next 18 to 24 months. Gold Fields has total attributable gold equivalent Mineral Reserves of 76.7 million ounces and Mineral Resources of 225.4 million ounces.
The company is currently working on two advanced exploration projects in central Chile, and is also interested in exploring Colombia, Kruger said.