Creating shared value for business and communities

Categories: Community, Economics, Management Tags: ,


Freeport-McMoRan operates the Cerro Verde copper and molybdenum mining complex located in an arid region on the west side of the Andes Mountain Range, 30km southwest of Arequipa, Peru. The city is reliant on the Chili River as the main source of water for the population, and for all economic activities in the region including agriculture, mining, commerce and tourism. Access to clean water is a major challenge due to population growth and the arid desert environment. While several dams and reservoirs have been developed, water supply is almost fully allocated. In addition, wastewater treatment capacity in the Arequipa Province is insufficient and, as a result, the Chili River has become contaminated with untreated residential and industrial sewage discharges, which impact water-reliant economic activities in the region.

Water for Cerro Verde’s current processing operations comes from the regulated Chili River system, and as this water source is shared with all industrial and domestic water users in the catchment, consistent access to clean water is a critical concern for all stakeholders. With Cerro Verde’s plans to expand operations, increased water supply was required, which was not available from existing sources on a permanent basis. In order to address the supply deficit, an innovative public–private partnership was initiated between Cerro Verde, civil society representatives, the local water utility company, local authorities and the central government to ensure the sustainable delivery of potable water and the treatment of the city’s wastewater.

Following engagement with local, regional and national stakeholders, Cerro Verde developed a potable water treatment plant, treating water from the Chili River, to deliver clean drinking water for the people of Arequipa.

The plant currently provides water to over 300,000 people in the region and is projected to expand to 750,000 people. In addition, the construction of a water storage and distribution network was undertaken to ensure water resources reach a greater proportion of households in the city.

Treating wastewater for use at the expanded Cerro Verde operations was found to be the best of several alternatives for a long-term source of water for the mine. In response, a wastewater treatment plant is currently being constructed by Cerro Verde to treat most of the city’s wastewater. Cerro Verde will pay for the design, engineering, construction, operation and maintenance of the system for the first two years, as well as for the pumping of water for at least 29 years.

This much-needed infrastructure will improve regional water quality, reduce waterborne illnesses and enhance the value of local agricultural products while providing water for an economically important operational expansion for the region. The wastewater treatment plant will supplement water supplies to Cerro Verde, and will deliver an annual average of 1 cubic meter per second of treated water to the mine. Any excess treated water will be returned to the river for the local water utility company to allocate.

Together, the two plants, along with the storage and distribution network, are supplying clean drinking water to the people of Arequipa and will allow wastewater generated by the population to be treated. This will reduce the environmental and human health impacts of discharging untreated water into the Chili River. Cerro Verde’s support for the facilities is aligned with its efforts to assist with the social needs of communities near the mine, and to create shared value for local water users.

Key issues

  • Water scarcity
  • Lack of municipal water treatment infrastructure

Collaborative solutions

A public–private partnership to address water shortages and deliver wastewater solutions and potable water to local communities