Argentina’s PSJ copper mining restart is drawing attention as a potential new source of mined copper supply outside Chile and Peru. Global copper demand is rising alongside electrification, renewable energy expansion and industrial decarbonisation. Over recent decades, Chile and Peru have supplied roughly 40% of global mined copper output.
The concentration in those two jurisdictions has supported supply stability while also creating risks linked to water scarcity, labour disruptions, regulatory changes and fiscal pressure. Against that backdrop, investors have increasingly focused on where the next major South American copper-producing jurisdiction could develop. Argentina is among the countries frequently cited for its mineral potential in the Andes.
Andean porphyry geology and constraints on copper output
Argentina sits within the Andean porphyry copper belt that hosts major deposits across neighbouring countries. Porphyry systems are typically associated with large, disseminated mineralisation that can be developed using open-pit, bulk mining approaches. The PSJ deposit in Mendoza province is described as fitting this development model.
Despite the geological setting, Argentina’s copper production has remained minimal. The source of the underperformance is attributed to structural constraints rather than geology. These include a fragmented jurisdictional system where provinces control mining rights independently of the national government.
Additional factors cited are long-standing provincial restrictions in Mendoza, where open-pit metal mining was effectively banned for more than 20 years. Macroeconomic instability is also mentioned, including currency volatility, capital controls and recurring sovereign debt restructuring that increase financing costs. Social and environmental sensitivities are further noted, including water usage concerns, glacier protection issues and agricultural impacts in wine-producing areas.
Mendoza Senate approval of PSJ environmental impact statement
A key milestone for the PSJ restart occurred in December 2025 when the Mendoza Senate approved the project’s Environmental Impact Statement (EIS). The approval is described as overturning a prior legislative rejection that had been in place for approximately 14 years. Mendoza has historically been one of Argentina’s most restrictive provinces for metallic mining.
Opposition to metallic mining in Mendoza has been linked to concerns over water contamination, glacier preservation and protection of agricultural land in a major wine-producing region. The EIS approval indicates a shift in provincial stance toward large-scale mining as a potential contributor to economic growth. It also points to expected outcomes including employment, infrastructure development and royalty generation.
PSJ project design and processing route
The PSJ project is marketed as Cobre Mendocino and is planned as an open-pit copper operation in the Andean foothills of Mendoza. The project’s processing route follows a conventional porphyry copper model used at major operations. Steps include open-pit mining and ore extraction.
The flowsheet continues with crushing and grinding of ore material. It then includes solvent extraction and electrowinning (SX-EW) processing. The final product is refined copper cathodes.
Copper cathode production is highlighted as a key feature of the design. The source contrasts cathodes with copper concentrate that requires additional smelting and refining abroad. It states that cathodes can be exported directly or used in industrial applications.
Estimated capital cost and financial adviser involvement
The estimated capital expenditure for PSJ ranges from US$559 million to US$630 million. The range reflects engineering work progressing from early feasibility studies toward more detailed design. Variability at this stage is described as common due to infrastructure additions, contingency allowances and technical refinements incorporated into updated models.
The involvement of RBC Capital Markets is cited as an indicator of increasing institutional confidence. The source states that major international investment banks typically engage only when a project shows sufficient geological certainty, regulatory progress and commercial viability to support potential financing pathways.
RIGI framework supporting large-scale investment
A factor supporting the PSJ restart is Argentina’s Régimen de Incentivo para Grandes Inversiones (RIGI), introduced in 2024 as part of broader economic reform efforts. RIGI is described as intended to reduce structural risks that have historically discouraged large-scale foreign investment in Argentina, particularly in capital-intensive sectors such as mining.
For projects like PSJ, the framework provides currency stability mechanisms allowing partial retention of export revenues in foreign currency to reduce exposure to peso volatility. It also includes tax and royalty stability guarantees intended to keep fiscal terms unchanged over the life of an approved investment. Regulatory predictability is another stated element, aimed at limiting sudden policy shifts during execution.
The protections are described as especially relevant for project finance lenders because they typically require long-term visibility on cash flows and sovereign risk exposure before committing capital. By applying for RIGI status, PSJ seeks improved financing conditions through a reduced risk profile within Argentina’s broader development pipeline.
Context for new copper supply outside Chile and Peru
The PSJ project in Mendoza is presented as more than a single mine development within Argentina’s copper sector context. It is described as a test case for translating geological endowment into production under a more stable investment framework. If advanced, it would also relate to attracting further exploration and development across Andean provinces.
The source links timing for new supply with market conditions including declining ore grades, long permitting timelines and rising demand tied to electrification trends. In that context, additional copper supply sources are described as becoming strategically important for meeting demand growth outside established supply hubs.
