Published by: Minener.com | June 2, 2025
With Argentina’s federal government halting new public works under President Javier Milei, oil and mining companies — backed by provincial governors — are pushing for privatized infrastructure development to sustain Vaca Muerta, lithium mining, and agriculture.
Argentina’s mining and energy boom is facing a critical obstacle: a crumbling national infrastructure system and a federal government unwilling to invest in its repair or expansion.
Since President Javier Milei took office, his administration has made it clear that new public works will not be financed by the State. This position has alarmed energy and mining companies, who say logistical and energy bottlenecks are placing major projects at risk — especially in lithium production and Vaca Muerta’s shale operations.
Chronic Deficit, High Stakes
According to the Argentine Chamber of Construction (CAMARCO), sustaining just 3% annual economic growth would require investments equivalent to 9% of GDP, or $54 billion annually, in infrastructure. CAMARCO President Gustavo Weiss noted that only 40% of necessary infrastructure investments have been made over the past 50 years — a key reason for Argentina’s current bottlenecks.
One-third of that investment is needed just to maintain existing assets at the national, provincial, and municipal levels. Another third would go toward new projects, and the remainder would come from private operators in sectors like electricity, gas, and telecoms.
Mining Giants Sound the Alarm
At the recent ArMinera expo in Buenos Aires, executives from global mining companies warned of rising logistical costs that threaten project viability.
“We pay almost as much in logistics as we do for reagents,” said executives from McEwen Copper (Canada) and Eramet (France).
Alejandro Moro, CEO of Eramine, which produces lithium in Salta, added that 10% of the company’s capital expenditures had to go toward compensating for unavailable electricity.
Michael Meding, VP of McEwen Copper, was blunt:
“If we’re expected to build 1,400 kilometers of railway infrastructure, the project becomes unfeasible. Mining’s value lies in 40–50 years of operation, not construction.”
Provincial Pushback and Public-Private Models
The governors of Jujuy, Salta, Catamarca, San Juan, and Mendoza have formally demanded that the federal government accelerate infrastructure privatization and decentralize project approvals.
Alfredo Cornejo, Governor of Mendoza, warned:
“The national government must understand that infrastructure can’t rely solely on private investment. We need to work together.”
Roberto Cacciola, President of the Argentine Chamber of Mining Companies (CAEM), added:
“We need to address infrastructure issues head-on. National highways and rail bids must move forward — lithium and copper megaprojects depend on it.”
One solution gaining quiet attention is Peru’s ‘Works for Taxes’ model, where private firms build public infrastructure in lieu of paying taxes in cash. While some Argentine officials support the idea, they propose swapping taxes for provincial royalty payments instead, as the federal government remains opposed to new public investment.
Private Efforts in Vaca Muerta and Beyond
In Vaca Muerta, oil companies have already teamed up to finance 51 kilometers of road paving in Neuquén to improve shale field access. Private funding is also supporting oil and gas pipelines, and discussions are underway around high-voltage transmission lines for industrial growth.
According to the Federal Investment Council (CFI), provinces require at least 1,152 infrastructure projects, with only 29% requiring large-scale capital. Out of 240,000 kilometers of roads nationwide, just 86,000 are paved, and only 15,000 kilometers can accommodate cost-saving bi-trains.
On the rail side, just 31.4% of Argentina’s 28,722 kilometers of freight rail lines are in good condition, according to CFI — a lingering obstacle to national productivity.
Conclusion
With federal public works halted and investment demands growing, Argentina’s mining and energy sectors face an urgent choice: either build the infrastructure themselves, or watch their momentum stall. Whether through privatization, royalties-for-infrastructure deals, or hybrid public-private models, the infrastructure question may determine the fate of Argentina’s resource-powered future.