"The industry is seeing significant changes in how mining operations are conducted and the challenge lies in adapting to the technology requirements that come with them. For example, we are seeing a trend away from open-pit mining and towards underground mining. Engineering companies must provide solutions to changing needs."

Ivan Rayo

GENERAL MANAGER, JRI

January 22, 2020

Can you give us an overview of JRI and the company’s business offerings to the Chilean mining industry?

Our company has four main business branches. These branches are multi-disciplinary meaning that we cover services across all developmental and construction stages. The first branch is the design of underground mines. Second, the building of treatment plants. This means taking care of a mine’s infrastructure for the grinding and other processes done on the mineral. Third, is design of pipeline systems for water and mineral transportation. Fourth, is tailings dam design.

Can you mention some projects JRI has been involved in recently?

One project we were involved in recently was the renovation of Coldelco copper mine in El Salvador. The name of the project is Rajo Inca, and it extended the site’s life for another 40 years.

We have been involved in two underground projects in El Teniente Mining. The name of the projects are Andesita and Diamante. They will enter in the construction stage in 2022.

We are also involved in projects of a more conceptual nature. For instance, we were contracted to identify bottlenecks and help with operation efficiency at the KGHM’s Sierra Gorda mine.

To what do you attribute the prevalence of brownfield projects over greenfield projects in Chile today?

Codelco is the largest client for engineering services in the country. Currently, the company is focused on renovating its current assets in order to insure capacity to operate in the future. In general the trend is not into greenfield projects.

The rest of the industry is in a similar position. There are few new mines being built and the bulk of the work that is being done is in already existing assets.

How have depreciations in the copper price affected JRI’s business and the demand for the company’s services?

When the copper price was booming, there was a large market of new mining projects and the demand for engineering services were very high. Nowadays, the demand for engineering services has shrunk. It has also meant fiercer competition. Many companies are looking for opportunities outside of Chile where they can lend their expertise.

Unlike other companies, JRI business model was less reactive to market influences and therefore it has responded more robustly to the changes. It has been increasing its market share in Chile. Since, 2017 we have experienced 20% per annum growth.

What are the biggest challenges for the Chilean mining industry?

The industry is seeing significant changes in how mining operations are conducted and the challenge lies in adapting to the technology requirements that come with them. For example, we are seeing a trend away from open-pit mining and towards underground mining. Engineering companies must provide solutions to changing needs.

Another challenge is with industry regulation. There is stricter regulation on tailings and companies must be able to adapt their operations accordingly.

What are some of JRI’s achievements that you are most proud of?

I am most proud of the company’s growth. We have successfully increased our market share and are participating in larger and important projects. For example, we are involved in large structural projects for Codelco.

What are some areas of opportunity for JRI geographically?

We want to increase our presence in Peru. There have been fluctuations in mining permits and requirements and that has impacted our ability to penetrate the market.

The challenges for mining in Peru and Chile are different. Mining in Peru tends to be smaller scale and more selective while Chilean mining is characterized by large rates of extraction and considerably larger mining sites. The location of the operations also poses different challenges. In Chile, the majority of the  projects tend to be located in the desert away from local communities while mining in Peru is done in the close vicinity of the inhabitants and far away from the ports.

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