Brazil’s lengthy licensing process is discouraging investments in its mining sector, according to Ibram’s CEO Raul Jungmann. He reported that $68.4 billion in expected investments from major miners could increase if permitting were streamlined. Brazil possesses vast mineral reserves, but strict regulations from independent bodies are contributing to investor concerns.
Brazil is positioned to capitalize on the growing global demand for critical minerals. However, the country’s lengthy and complex licensing process significantly hampers investment, as articulated by Raul Jungmann, the CEO of Ibram and former environmental chief. He emphasized that the seven-to-eight-year wait for mineral project licenses is detrimental, stating it effectively cools investor interest at a conference in Rio de Janeiro.
The anticipated investment in Brazil from major mining firms is projected to reach $68.4 billion between 2025 and 2029. Jungmann indicated that this figure could potentially increase if permitting procedures were made more efficient, citing that other nations manage to approve licenses in half the time that Brazil does.
Brazil is rich in mineral resources, boasting the largest niobium reserves globally, and ranking second in graphite and third in rare earth elements and nickel. Additionally, the country is a leading producer of iron ore and hosts major companies like Vale SA. Nevertheless, independent regulators enforce stricter environmental and safety regulations than are common elsewhere.
Moreover, it is not only mining sectors that are feeling the weight of regulatory challenges. Petrobras, Brazil’s state-controlled oil producer, has encountered significant delays since 2020 in acquiring approval to initiate drilling in the Foz do Amazonas basin, which it sees as a potential new offshore frontier. CEO Magda Chambriard has highlighted that regulatory hurdles from Ibama have become more problematic than those from the oil and gas regulator, which previously halted one of Petrobras’s production vessels.
In conclusion, Brazil faces significant challenges with its extensive licensing processes for mineral and oil projects, leading to a slowdown in potential investments. The country’s rich mineral resources present an opportunity, yet inefficient permitting could deter investors. Improved regulatory efficiency may enhance Brazil’s attractiveness for foreign investments in the mining sector.
Original Source: www.mining.com
