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Gold Field measures its value to Peru in terms of the jobs it creates, the local suppliers it promotes, and its positive interventions in surrounding communities.
Would you give us an overview and assessment of Gold Fields' current operations in Peru? How well has Gold Fields managed and responded to the challenges of 2020?
Gold Fields has its Cerro Corona mine operations in northern Peru. We have been operating in Peru for the last 11 years. We like the country, firstly for its geological endowments. Three years ago, our Cerro Corona operation was scheduled to be shut down in 2023; however, thanks to our team and some innovative proposals, we have been able to extend the life of the Cerro Corona mine to at least 2030 and likely to 2032. This is big news for the country, Gold Fields, and Cerro Corona. We are also extremely active in our exploration activities. We have a 16% stake in Chakana Copper Corp.'s Peruvian subsidiary Chakana Resources, a mining company exploring in Ancash Province not far from Lima. With that, we have a footprint in the Ancash region. In 2020, we created a new exploration vice-president role at Gold Fields where the main focus is to find more assets in Peru. We are looking for properties in central and southern Peru. Hopefully, if the pandemic allows it, we will be in a position to make a big announcement in 2021.
What is Gold Fields' strategy for developing new technologies to extend the life of your mines?
First, we decided to change our strategy. We were going to continue doing things the same way as in the past and, as a result, shut down our Cerro Corona operations in 2023. However, we renewed and reshaped the team, and it came back with a new proposal. The main restriction at Cerro Corona mine is space; we do not have room for additional tailings. We decided to use the pit as the tailings compartment, which is extremely challenging to do from an engineering standpoint. We did some research and investigations around the pit. We drilled deep holes and studied the hydrologic, geological, and hydric configurations. With that, we completed a feasibility study, proposed a new mine plan, and were able to recommend using the pit as a tailings compartment. That gained us another seven years mine life.
How is Gold Fields and the wider mining sector in Peru engaging with the big global trend of environmental responsibility and sustainability?
We have been talking about technologies and mining activities, but beneath that is a huge social apparatus working in Peru to secure our social license. Since we commenced our operations here 11 years ago, we have established our main style based on our important pillar of adding value to society. We believe in the shared value concept. Our value is not only in the taxes we generate, but also in the jobs we create around us, the local suppliers we promote, the local economy we stimulate, and our positive intervention in social activities in all our surrounding communities. In the world today, it is not enough for a company just to be a good taxpayer; it has to be a good citizen and, more than that, a good friend to communities.
What is your assessment of the local mining regulatory framework? Are there things the government could do to improve the sector's and Gold Field's ability to operate in the country?
Peru is extremely competitive due to its geological endowment; when it comes to taxes, it's similar to other big mining jurisdictions. However, it is not that successful in terms of infrastructure because Peru is in the Andes, and many mining sites are remote and far from the ocean and ports. Peru also has more regulations, and processes in its public offices are slower and more administratively repetitive. When it comes to the social environment, we do have conflicts in Peru due to a lack of public investment. We have many things to improve when it comes to regulation.