Under the Chilean Government led by Gabriel Boric, plans to nationalise parts of the country’s mining sector have fallen through after the constitutional assembly voted against the movement.
The major overhaul of potential mining rights in Chile, the world’s top copper producing nation, was rejected on Saturday, despite considerable efforts from the environmental commission.
In order to nationalise parts of Chile’s mining industry, a 103-vote supermajority was required to pass into the draft constitution.
Article 27, which would have given the government exclusive mining rights over lithium, rare metals and hydrocarbons and a majority stake in copper mines was voted down by the assembly.
Despite this, Article 25, which states that miners must set aside “resources to repair damage” to the environment and harmful effects where mining takes place, did receive support and a supermajority, meaning it will be in the draft constitution.
Approval was also given to ban mining in glaciers, protected areas and those essential to safeguarding the water system.
Also given the green-light were articles giving farmers and indigenous people the right to traditional seeds, safe and accessible energy, and protection of oceans and the atmosphere.
The final draft is due in early July and citizens will vote to approve or reject it on 4 September.
Mining is a major driver of the Chilean economy – contributing more than 50% to Chile’s exports and with the country rated highly globally for its low sovereign risk and significant mineral resources. This news will make Chile a far more attractive jurisdiction for explorers and miners.
Explorers and miners with Chilean projects to benefit
The news of Article 27 falling through has many mineral explorers and miners including BHP Group (ASX: BHP) rejoicing, with any drastic changes now unlikely.
Prior to the vote, BHP President Minerals Americas Ragnar Udd said he remained optimistic for an industry that accounts for more than half the country’s exports.
“I’m actually really confident that Chile will be able to appreciate the huge opportunity that it has in front of it as a country,” he said.
“We need to let the process resolve itself before we get too fixated one way or the other in terms of what the outcomes are.”
The BHP president says the company has “some really, really exciting plans for Chile” that will now be possible without the nationalisation of mining in the South American country.
As well as BHP, there are numerous other companies listed on the ASX and TSX that will welcome the positive news for their current and future projects.