What is the Los Azules Copper Project?
The Los Azules copper project stands as one of Argentina's most promising mining developments, strategically located in the Calingasta department of San Juan province. Nestled at an altitude of 3,600 meters above sea level in the Andean Cordillera, this high-altitude venture is positioned approximately 80 kilometers west-northwest of Calingasta town and just 6 kilometers from the Chilean border. With its world-class copper resources and innovative development approach, Los Azules is poised to transform Argentina's mining landscape while establishing new benchmarks for environmental responsibility in the sector.
Project Overview and Strategic Importance
Los Azules represents a world-class porphyry copper deposit with exceptional resource estimates totaling 10.9 billion pounds in the Indicated category and 26.7 billion pounds in the Inferred category. These impressive numbers position the project among the largest undeveloped copper resources globally, with significant strategic importance for both regional economic development and the worldwide clean energy transition that depends heavily on copper price insights.
The deposit's size and quality make it a critical asset in Argentina's mineral portfolio, potentially transforming the country's role in global copper markets once production begins. With copper demand projected to increase substantially due to electrification and renewable energy growth, Los Azules offers timely development of a strategic resource.
Ownership and Development Timeline
McEwen Copper Inc., a subsidiary of McEwen Mining, holds ownership and operational control of the Los Azules copper project San Juan through its registered entity ANDES Corporación Minera S.A., which is established as a Single Project Vehicle (VPU) with headquarters in Mendoza, Argentina. This corporate structure was specifically designed to facilitate the project's development and maximize its eligibility for Argentina's investment incentive programs.
The company has outlined an ambitious development timeline, with construction targeted to begin in 2026 and first production anticipated around 2030. Once operational, the mine is projected to have a 27-year total lifespan, including a 21-year productive phase during which it will contribute significantly to global copper supplies and Argentina's export economy.
How Will the RIGI Approval Impact Los Azules?
Understanding the RIGI Framework
On October 14, 2025, the Argentine government officially incorporated the Los Azules project into the Régimen de Incentivo para Grandes Inversiones (RIGI) through Resolution 1.553/2025, published in the Official Gazette. This milestone decision followed a thorough evaluation conducted by the RIGI Evaluation Committee on September 26, 2025, which examined the project's technical, economic, and social merits under Law 27.742.
The RIGI framework represents Argentina's strategic approach to attracting large-scale capital investments in priority sectors including mining, energy, and infrastructure. By establishing a comprehensive set of incentives and guarantees, the government aims to overcome historical challenges related to regulatory uncertainty and economic volatility that have previously deterred international investors.
Financial Benefits and Investment Protection
The RIGI approval provides Los Azules with significant financial advantages and regulatory protections that substantially improve its economic viability:
- Reduction of corporate income tax from the standard 35% to a preferential 25% rate
- Full exemptions from export duties that would otherwise increase operational costs
- Accelerated IVA (Value Added Tax) credit recovery during pre-operational phases, improving cash flow
- Regulatory stability guarantees that protect against adverse legal changes
- Access to international arbitration mechanisms that provide investor confidence
These incentives substantially enhance the project's economic fundamentals and investor appeal, providing essential protections against Argentina's historically volatile regulatory environment. The stability provisions are particularly valuable as they insulate the project from potential policy changes that might otherwise compromise long-term planning and return calculations.
The Los Azules approval also positions the project within a select group of strategic investments in Argentina, as it represents one of just eight RIGI-approved projects with a combined value of US$15.739 billion across various sectors including energy, mining, and steel production.
What Makes Los Azules Economically Viable?
Investment Scale and Economic Indicators
The total investment for Los Azules is projected to exceed US$3.1 billion, with US$2.672 billion specifically designated as RIGI-eligible investment. The financial structure includes US$2.353 billion allocated to computable assets, with a first two-year investment commitment of US$415 million—surpassing the 40% minimum requirement under the RIGI framework. The investment completion deadline has been established as December 31, 2027.
According to the comprehensive 2025 Feasibility Study, which adheres to NI 43-101 international standards for mining project disclosure, Los Azules demonstrates compelling economic fundamentals:
- Internal Rate of Return (IRR): 21.2%, indicating strong profitability
- Net Present Value (NPV): US$2.6 billion after taxes, reflecting substantial value creation
- Initial capital expenditure (CAPEX): US$3.17 billion
- Base copper price assumption: US$4.00 per pound
These economic indicators suggest the project will generate significant returns despite its substantial upfront investment requirements, making it attractive to both equity investors and potential lenders evaluating project finance opportunities.
Production Capacity and Operational Efficiency
Los Azules is designed to produce an average of 204,800 tonnes of high-purity copper cathodes annually during its 21-year productive phase. This production scale positions it among significant global copper operations, with output that will contribute meaningfully to international copper supply chains.
The project will utilize heap leaching and solvent extraction-electrowinning (SX-EW) technology to produce 99.99% pure copper cathodes. This processing approach offers several advantages over conventional concentration methods:
- Higher-value end product that can be sold directly to manufacturers
- Reduced energy consumption compared to traditional smelting operations
- Minimized water requirements through closed-circuit operation
- Elimination of conventional tailings facilities that typically present environmental challenges
This technology choice enhances both operational efficiency and environmental performance, aligning with contemporary expectations for responsible resource development while optimizing economic returns.
How Will Los Azules Impact Local Communities?
Employment Generation and Skills Development
Los Azules is projected to create more than 3,500 direct and indirect jobs, providing significant employment opportunities for San Juan residents. This employment boost represents a transformative economic opportunity in a region where high-quality jobs can be limited, particularly in remote areas like Calingasta department.
The project has already initiated practical training programs in collaboration with mining service providers like Caterwest, focusing on developing local skills in areas such as culinary arts and hospitality services specifically tailored for mining operations. These early-stage training initiatives demonstrate the company's commitment to building a skilled local workforce well in advance of operational requirements.
By prioritizing local hiring and skills development, Los Azules aims to maximize the economic benefits flowing to San Juan communities while building operational capabilities that support project efficiency. The training programs currently underway represent just the beginning of a broader skills development strategy that will expand as the project advances toward construction and operation.
Local Content and Supply Chain Development
A standout commitment from the Los Azules project is its pledge to source 61.1% of its procurement budget from local San Juan businesses during both construction and operational phases. This exceptional local content level far exceeds the 20% minimum requirement established by RIGI regulations, demonstrating a substantial commitment to regional economic development.
This local procurement approach encompasses suppliers, purchases, and construction works, creating significant business opportunities across multiple sectors of the San Juan economy. The comprehensive supply chain strategy will help diversify the provincial economy while building capacity that may serve other mining operations and industries in the future.
By creating this extensive supply chain network within San Juan, Los Azules will generate economic multiplier effects that extend far beyond direct employment, potentially transforming the regional economy through sustainable business development and technological advancement.
What Environmental Innovations Will Los Azules Implement?
Sustainable Water Management
Los Azules has designed a revolutionary closed-circuit water system that completely eliminates the use of fresh water sources. Instead, it will reuse process solutions in a closed loop, minimizing its hydrological footprint in the water-sensitive Andean environment where glaciers and high-altitude watersheds play critical ecological roles.
This zero-fresh-water approach represents a significant advancement in mining sustainability, particularly in an arid region where water resources are both ecologically precious and often contentious among different stakeholders. By eliminating competition for fresh water, the project reduces potential conflicts with agricultural users, local communities, and environmental interests.
The closed-circuit design also minimizes potential contamination risks by containing all process solutions within the operational system, reducing the likelihood of environmental releases that might impact surrounding ecosystems.
Renewable Energy Commitment
McEwen Copper has committed to powering Los Azules entirely with renewable energy, having secured agreements for solar and wind power supply. This 100% renewable approach supports the project's ambitious goal of achieving carbon neutrality during its productive phase, positioning Los Azules as a leader in climate-responsible mining.
By eliminating fossil fuel dependence for its electrical requirements, the project will avoid significant greenhouse gas emissions typically associated with mining operations. This renewable energy strategy aligns with global climate objectives while potentially reducing long-term operational costs by avoiding exposure to fossil fuel price volatility.
The project's renewable energy commitment extends beyond regulatory requirements, representing a voluntary leadership position that sets new expectations for mining operations in Argentina and potentially throughout South America.
Environmental Technology Integration
The heap leaching and electrowinning process selected for Los Azules represents a significant departure from traditional concentrate production methods. This technology choice reduces energy requirements, water consumption, and overall environmental impact while producing a higher-value end product.
Key environmental advantages of this processing approach include:
- Elimination of conventional tailings facilities that can present long-term management challenges
- Reduced energy consumption compared to traditional concentration, smelting, and refining
- Minimized land disturbance through efficient processing infrastructure
- Lower overall carbon footprint aligned with climate objectives
These technological choices demonstrate how innovative approaches can simultaneously enhance environmental performance and economic outcomes, challenging the conventional perception that environmental protection necessarily comes at the expense of profitability.
What Technical Innovations Will the Project Implement?
Advanced Processing Technology
Los Azules will employ a state-of-the-art heap leaching and solvent extraction-electrowinning (SX-EW) process to produce copper cathodes with 99.99% purity. This approach differs fundamentally from conventional concentration methods and offers several advantages:
- Direct production of market-ready copper cathodes without requiring separate smelting and refining
- Elimination of waste tailings typically associated with concentration processes
- Reduced energy consumption compared to traditional pyrometallurgical routes
- Minimized water requirements through closed-circuit operation
- Higher overall value creation by producing finished copper products rather than intermediate concentrates
The technical process begins with conventional mining, followed by crushing and agglomeration of the ore. The prepared material is then placed on engineered heap leach pads where a leach solution gradually dissolves the copper. This copper-bearing solution is processed through solvent extraction to concentrate and purify the copper, which is then recovered as high-purity cathode metal through electrowinning.
Sustainable Mining Practices
The project design incorporates progressive rehabilitation and environmentally conscious extraction methods throughout its lifecycle. McEwen Copper aims to make Los Azules Argentina's first regenerative copper mine, setting new standards for environmental stewardship in the mining sector.
Technical innovations in mine planning, waste management, and closure design will enable concurrent rehabilitation of disturbed areas whenever possible, minimizing the project's active footprint at any given time. This approach reduces environmental impacts while lowering long-term closure costs and liabilities.
Advanced monitoring technologies, including remote sensing, automated water quality monitoring, and real-time emissions tracking, will provide unprecedented visibility into environmental performance. This data-driven approach enables rapid response to any deviations from expected parameters while building transparency and trust with regulators and community stakeholders.
How Does Los Azules Fit into the Global Copper Market?
Strategic Timing for the Energy Transition
Los Azules is positioned to enter production around 2030, during a period when many analysts project significant copper supply deficits. This timing aligns with accelerating global demand driven by several interconnected trends:
- Electrification of transportation systems, with electric vehicles requiring up to four times more copper than conventional vehicles
- Expansion of renewable energy infrastructure, with wind and solar installations being substantially more copper-intensive than fossil fuel power plants
- Growth in electricity transmission and distribution networks needed to support electrification
- Increasing copper intensity in modern technologies, including consumer electronics, industrial equipment, and smart infrastructure
These demand factors, combined with projected supply constraints from aging existing mines and limited development of new projects, create a favorable market environment for Los Azules as it enters production. The project's timing may allow it to benefit from potentially higher copper prices driven by structural supply-demand imbalances.
Quality Advantages in a Competitive Market
By producing high-purity copper cathodes rather than concentrate, Los Azules will create a premium product that commands higher market prices and faces fewer trade restrictions. This positioning offers several advantages:
- Direct sales to end users without intermediate processing requirements
- Reduced transportation costs per unit of contained copper compared to concentrates
- Avoidance of treatment and refining charges imposed on concentrate producers
- Eligibility for premium pricing based on 99.99% purity standards
- Reduced exposure to potential concentrate import restrictions that some countries impose
These quality advantages position Los Azules advantageously in the evolving global copper market, particularly as manufacturing becomes increasingly sophisticated and demands higher-purity materials for advanced applications in electronics, renewable energy, and electric vehicles.
What Financial Support Has Los Azules Secured?
International Financial Institution Backing
On October 14, 2025, McEwen Copper and the International Finance Corporation (IFC), a member of the World Bank Group, signed a collaboration agreement to align the project with IFC's environmental, social, and governance (ESG) standards. This partnership opens pathways for potential future debt and equity financing from the institution.
The IFC involvement represents significant validation of the project's approach and potential, as the organization applies rigorous sustainability and governance standards to its investment decisions. This relationship may also facilitate connections with other international financial institutions and export credit agencies that often follow IFC's lead when evaluating mining projects.
The collaboration agreement will help Los Azules implement best practices in areas including community engagement, environmental management, and corporate governance. These enhanced standards may strengthen the project's social license to operate while improving its access to responsible investment capital from institutional investors with strict ESG requirements.
Strategic Investment Partners
The project has successfully completed several financing rounds, attracting significant capital from strategic investors interested in securing future copper supply. These partnerships strengthen the project's financial foundation and validate its development approach.
Strategic investors typically bring more than just capital to mining projects; they often provide technical expertise, market access, and long-term offtake commitments that reduce commercial risks. This diverse support network enhances the project's resilience against market volatility while providing multiple pathways to full financing.
The RIGI approval further enhances the project's attractiveness to both strategic and financial investors by reducing regulatory risks and improving expected returns. This government endorsement signals institutional support that may streamline future permitting and development milestones.
What Challenges Must Los Azules Overcome?
Infrastructure Development Requirements
The remote location of Los Azules presents significant infrastructure challenges that must be addressed, including:
- Access road improvements for year-round operability in challenging mountain conditions
- Power transmission infrastructure development to deliver renewable energy to the site
- Communication systems installation for operational safety and efficiency
- Water management systems construction to implement the closed-circuit design
These infrastructure requirements represent both significant costs and logistical challenges, particularly given the 3,600-meter altitude and seasonal access limitations. Careful planning and execution of infrastructure development will be critical to maintaining the project timeline and budget.
The project's location near the Chilean border also introduces cross-border considerations that may affect access routes, supplies, and services. Navigating these international dimensions adds complexity to infrastructure planning and implementation.
Regulatory Compliance and Community Relations
Despite RIGI approval, Los Azules must navigate complex regulatory requirements at provincial and national levels while maintaining strong community relationships. The project's success depends on balancing economic development with environmental protection and social responsibility.
Specific challenges include:
- Securing and maintaining numerous permits and approvals beyond the RIGI framework
- Building and sustaining community support through transparent engagement
- Managing stakeholder expectations regarding employment, procurement, and benefits
- Adapting to potential regulatory changes outside the RIGI stability provisions
- Demonstrating ongoing compliance with environmental and social commitments
Effective management of these dimensions requires sophisticated stakeholder engagement strategies and robust compliance systems that demonstrate responsible performance throughout the project lifecycle.
What is the Long-Term Vision for Los Azules?
Establishing a Sustainable Mining Model
McEwen Copper envisions Los Azules as a blueprint for responsible mining development, demonstrating how large-scale resource extraction can coexist with environmental stewardship and community prosperity. The company aims to achieve carbon neutrality by 2038 and create lasting positive impacts in the region.
This sustainability vision encompasses all aspects of the operation, from renewable energy and water conservation to progressive rehabilitation and community development. By implementing and demonstrating these practices at scale, Los Azules has the potential to influence standards across Argentina's mining sector and beyond.
The project's commitment to producing cathodes rather than concentrate also represents a value-adding approach that maximizes in-country benefits while reducing the environmental footprint of the overall copper supply chain. This integrated model creates a more sustainable pathway for resource development.
Creating a Legacy Beyond Resource Extraction
Beyond copper production, Los Azules aspires to catalyze broader regional development in San Juan province, helping diversify the local economy and build sustainable prosperity that will endure beyond the mine's operational life.
Key legacy elements include:
- Development of transferable skills in the local workforce
- Establishment of businesses and supply chains that can serve multiple sectors
- Infrastructure improvements that benefit communities and other economic activities
- Strengthened educational and training institutions that support ongoing development
- Diversified economic activities that reduce dependence on mining
By focusing on these enduring benefits, Los Azules aims to avoid the boom-and-bust cycle that has characterized many mining regions historically, instead creating foundations for sustainable prosperity that continues after mine closure.
Los Azules as a Transformative Force
The Los Azules copper project represents a potentially transformative development for San Juan province and Argentina's mining sector. By combining world-class copper resources with innovative processing technology and strong environmental commitments, the project aims to create substantial economic value while setting new standards for sustainability in the mining industry.
With an investment exceeding US$3.1 billion and projected annual production of 204,800 tonnes of high-purity copper cathodes, Los Azules will significantly boost Argentina's mining exports while creating more than 3,500 jobs and extensive supply chain opportunities. The project's 61.1% local content commitment ensures these benefits will flow substantially to San Juan businesses and communities.
The project's innovative environmental approach—featuring zero fresh water consumption, 100% renewable energy, and waste-minimizing processing technology—establishes new benchmarks for responsible resource development. These features position Los Azules as a model for how modern mining technology can support both economic development and environmental protection.
As global copper demand continues to grow, driven by the energy transition dynamics and technological advancement, Los Azules is positioned to become a significant contributor to global supply chains while demonstrating how responsible resource development can create lasting benefits for local communities and the broader economy.
FAQs About the Los Azules Copper Project
When will the Los Azules project begin production?
Construction is targeted to begin in 2026, with first production anticipated around 2030, initiating a projected 27-year operational lifespan that includes 21 years of active copper production.
How much copper will Los Azules produce annually?
The project is expected to produce approximately 204,800 tonnes of high-purity copper cathodes (99.99% purity) annually during its 21-year productive phase, using advanced heap leaching and electrowinning technology.
What environmental commitments has the project made?
Los Azules has committed to using 100% renewable energy from solar and wind sources, implementing a closed-circuit water system with no fresh water consumption, and achieving carbon neutrality during its productive phase. The project will also eliminate conventional tailings through its processing approach.
How many jobs will the project create?
The development is projected to generate more than 3,500 direct and indirect jobs, with significant opportunities for local residents of San Juan province. Training programs have already begun to prepare local workers for these opportunities.
What is the total investment for the Los Azules project?
The total investment is projected to exceed US$3.1 billion, with US$2.672 billion specifically designated as RIGI-eligible investment. The project has committed to investing US$415 million during the first two years of development.
Ready to Gain Early Access to Major Mineral Discoveries?
Discover why significant ASX mineral discoveries can lead to substantial market returns with Discovery Alert's proprietary Discovery IQ model, which instantly notifies investors of actionable opportunities ahead of the broader market. Explore historic discoveries and their exceptional returns at https://discoveryalert.com.au/discoveries/ and position yourself for success in copper and other mineral investments.
