Last week, I asked: What place holds the highest potential for a major discovery?
We started by looking in our own backyard… Australia.
But with its strong support for mining, well-trained staff, and advanced exploration techniques, ironically, it’s getting harder, not easier, to find major discoveries here!
That’s because it no longer holds that ‘untapped’ frontier status.
Thanks to decades of intensive exploration efforts across Australia, it has lost its shine as a major discovery centre.
Don’t get me wrong, pockets of high-potential, unexplored territory remain, like the Tanami or West Musgraves.
But if you really want to stack the odds in your favour as an investor, I suggest looking here instead…
Argentina: land of the giants
I firmly believe that Argentina is the best place for mineral explorers and their shareholders.
The key reason is that South America’s ‘copper belt’ straddles the border between Argentina and Chile, especially towards the south.
You can see what I mean on the map below, with the red/orange shaded areas depicting where this copper belt traverses:
|
Source: Risco Bayo |
But take careful note:
All the green stars (active mines) sit on the Chilean side, not Argentina!
Why?
Mega-mining projects take up to 20 years to develop and remain in production for many decades.
Companies need to trust the governments they’re working with to develop a mine… Traditionally, Chile has held strong political and economic stability; Argentina has not.
And that’s the key element that separates these two countries, one with a thriving mining industry and the other with very little development.
But the same geological potential!
Thanks to decades of hostile business conditions and economic chaos, miners haven’t ventured into Argentina.
But mark my words: that’s the key reason why this place is now one of the last great frontiers for mineral explorers.
Geology doesn’t follow national borders; the same geological setting that hosts giant copper porphyry deposits in Chile ALSO exists in Argentina.
For an exploration geologist, going into Argentina is like going into Chile, perhaps fifty or sixty years ago!
A time when discoveries were far larger, closer to the surface and of much higher grade.
So, why should investors take notice?
In case you’re not familiar, Argentina has been experiencing a tidal wave of reform since its new President, Javier Milei, swept into power in 2023.
Milei implemented a series of austerity measures, including slashing energy and transportation subsidies, laying off tens of thousands of government workers, freezing public infrastructure projects and imposing wage and pension freezes below inflation.
While it has been controversial, inflation has plummeted.
Bonds have rallied, and Argentina’s country-risk index, a measure of the risk of default, is at its lowest point in five years.
And perhaps most importantly, the world’s largest miners are moving in.
Earlier this year, BHP announced a multi-billion-dollar takeover deal for Filo Mining.
A company that discovered a massive copper-gold-silver deposit in Argentina.
Because of the country’s potential, in 2023, I recommended Filo and a company next door, NGEx Minerals, to my paid readership group.
For the readers who attended our Fat Tail Gala event in Melbourne a few years ago, I told them these two stocks were my highest-conviction picks in the mining industry.
Both have since surged or been taken over.
But that’s just a taste of what’s coming for Argentina’s mining industry.
Other majors are also starting to venture into Argentina…
Glencore is weighing two major copper developments in the country, requiring about $13.5 billion in investments.
Barrick, Lundin Mining, and Rio Tinto are other large companies starting to consider multi-billion-dollar investments.
So, what does this mean?
The big players are moving in, so it’s time to pay attention.
As I said, Argentina is the Chile of fifty years ago and is now finally open for business.
At my premium service, Mining Phase One, I am starting to build a basket of early-stage explorers with highly prospective ground.
One of them holds land very close to the discoveries of Filo and NGEx.
Furthermore, for the explorers holding valuable land in this part of the world, it’s like shooting fish in a barrel!
They’re using modern exploration techniques, but searching on ground that has never before been explored.
In a region that mirrors Chile… The world’s most prolific copper-producing nation.
If you’d like to find the explorers I’m backing, you can do so here.
Regards,
James Cooper,
Mining: Phase One and Diggers and Drillers
Comments