Seville MMH: Spain’s next mines hinge on funding

Financing Spain’s next mines depends on giving investors credible development schedules, yet uncertain approvals make it difficult to plan major spending, developers told the Mining and Minerals Hall conference.

The challenge extends to Touro in Galicia, where a proposed copper operation backed by Atalaya Mining (LSE: ATYM) remains in permitting. A 2018 prefeasibility study envisaged annual production of about 30,000 tonnes over 12 years.

“You even have equipment that needs a year for manufacture and installation at the mine, and much more,” Fernando Díaz Riopa, general manager of Cobre San Rafael’s Touro project, said. “Every year we’re dealing with the problem of timelines.”

Wednesday’s panel, “Why projects fail to reach operation”, examined the gap between Spain’s mineral potential and the mines it can actually build. Companies must keep financing and fieldwork moving through years of approvals, while securing local support and the workers needed to turn technically viable deposits into operating mines, speakers said.

The sixth edition of the three-day conference runs through Thursday at Seville’s Fibes centre, bringing together 332 exhibitors. Organized by Spanish metallic mining association Aminer and promoted by Andalusia’s regional government, it focuses on mining’s role in Europe’s future.

The panel discussion followed Tuesday’s call by former Spanish foreign minister Ana Palacio for Europe to match U.S. mining support with stable policies, public investment and purchase guarantees.

Planning ahead

Developers need enough certainty to coordinate investment, equipment orders and recruitment, Díaz Riopa said. That requires working with authorities to establish realistic approval schedules.

Atalaya holds a 10% interest in Cobre San Rafael, which owns Touro, with the right to increase its stake to 80% as development milestones are met.

Infrastructure can also shape development costs. Díaz Riopa contrasted projects near Seville’s existing services with his experience in Mauritania, where securing water, power, port access and workers posed additional challenges.

Atalaya is already operating a water treatment plant at Touro to address acid runoff from the historical mine. The company brought that work forward ahead of a new environmental impact assessment to demonstrate how modern systems could remedy the damage.

Touro remains in permitting despite receiving strategic industrial status from Galicia’s government in June 2024, a designation intended to simplify procedures and shorten approval timelines.

Community share

At Touro, a social plan aims to deliver economic and social benefits to neighbours, Díaz Riopa said. The company works closely with local mayors.

“They have to feel that the mine is theirs,” Díaz Riopa said. “Not that a company arrives, extracts the minerals and the benefits leave. They have to feel that it’s part of them, that they participate, that they have a say, that their opinions count.”

Juan Ignacio Artieda González Granda, representing Spain’s mining engineers’ council, argued that distrust among residents, authorities and financiers underlies many development hurdles.

He proposed revising the surface-area-based mining levy so payments better reflect the value of the minerals extracted and flow to surrounding communities.

“They would have a right to a steady income throughout the life of the mine and wouldn’t have to live off the charity of the company operating there,” Artieda said.

Artieda also proposed independent technical reviews by qualified professionals to give authorities greater confidence in development applications and help accelerate approvals.

Jesús Portillo García-Pintos, the Andalusian government’s director general of mines and the panel moderator, pointed to Aznalcóllar as an example of linking investment to restoration. The region made responsibility for historical environmental liabilities a condition of awarding mining rights, he said.

Artieda pointed to the strain mining can place on local roads and bridges as a reason to give communities an assured financial return.

“We all like to have rights, not to be given charity,” he said.

Funding, workers

For explorers, delays can interrupt the fieldwork needed to keep investors engaged, Juan García Valledor, general manager for Spain at Pan Global Resources (TSXV: PGZ; US-OTC: PGZFF), said.

“A junior company dedicated exclusively to exploration needs continuous financing, which is not at all easy to obtain,” he said. “The money coming in has to be spent in a sustained way that meets what the investor demands.”

García Valledor also called for inactive mining rights to be released for fresh exploration. Andalusia is already courting investors with faster approvals and access to hundreds of areas covered by expired rights.

Spain’s exploration effort benefits from thousands of years of mining and nationwide geological mapping at a scale of 1:50,000, Manuel Regueiro y González-Barros of Spain’s scientific research council, CSIC, said. Staffing presents a different challenge.

“There aren’t enough technical personnel to take on these new and necessary jobs,” he said.