On December 30, 2024, Compañía de Minas Buenaventura S.A.A. notified by the Private Investment Promotion Agency (?Agencia de Promoción de la Inversión privada? or ?PROINVERSIÓN?) about the granting to Buenaventura of the Private Initiative for Projects in Assets called ?Social management, design, and execution of hydraulic infrastructure projects, construction, implementation, and operation of the mining concessions that are part of the TG-3 deposit of the El Algarrobo project? (hereinafter, the ?El Algarrobo Project?), located in the Tambogrande district, Piura province and department.
The objective of the Project is as follows: The design and execution of hydraulic infrastructure projects that contribute to water supply, applying a management model focused on the integral and sustainable development of the population of the Comunidad Campesina Apóstol Juan Bautista de Locuto, following the signing of a ?Social Framework Agreement? between Buenaventura and the aforementioned community. The exploration, exploitation through an underground mine, and processing of a mineralized deposit (TG-3) of copper, zinc, and silver, located in the mining concessions Tambo Grande No.
4, Tambo Grande No. 5, Tambo Grande No. 9, and Tambo Grande No.
10, which comprise the El Algarrobo Project. On the other hand, the contractual framework of the Project includes the following stages: Suspensive Period of the Option's Validity: This period has a maximum duration of three (3) years from the signing of the Mining Concession Transfer Option Agreement to the signing of the Social Agreement between Buenaventura and the Comunidad Campesina Apóstol Juan Bautista de Locuto. Furthermore, the consideration for the Mining Concession Transfer Option Agreement amounts to USD 10,000,000.00, which Buenaventura must pay to Activos Mineros S.A.C., according to the agreed-upon schedule.
The first payment of USD 1,000,000.00 will be made upon the signing of the aforementioned Option Agreement. Option Validity Period: This period has a maximum duration of five (5) years, starting from the end of the suspensive period, during which Buenaventura may exercise the option. Additionally, it is foreseen that during this period, Buenaventura will have the status of mining assignee for the development of mining exploration activities, which will allow it to obtain information to decide on the exercise of the option.
Mining Concession Transfer Agreement: Under this agreement, ownership of the Mining Concessions will be transferred to Buenaventura if it exercises the option, in accordance with the applicable laws and regulations. It is under the condition of being the titleholder of the Mining Concessions that Buenaventura will carry out the mining exploitation. The consideration for the Mining Concession Transfer Agreement amounts to 1% of the Net Smelter Return (NSR), which corresponds to the value of the annual net revenues generated from the sale of all mineral resources extracted from the Mining Concessions and marketed in any form.
The TG-3 Deposit is a mining deposit of copper, silver, and zinc, on which the corresponding studies will be carried out to confirm its viability as a profitable project for Buenaventura. Finally, Buenaventura reaffirms its commitment to sustainability, particularly to the progress of the Locuto community, the Tambogrande district, and Peru. In this regard, the company will work in a coordinated manner to build a social agreement with the authorities and the local population, ensuring both access to water to boost agriculture and the development of local families, as well as a responsible and world-class mining project that benefits everyone.
