President-elect Kast stuns miners with Chile ministry merge

[Ben Graham]

Chile’s President-elect José Antonio Kast startled the mining industry by folding the mining portfolio into the economy ministry just hours after signalling he would appoint a standalone mining minister.

At a delayed cabinet ceremony in Santiago on Tuesday evening, Kast named Daniel Man as dual Minister of Economy and Mining, a last-minute decision that pushed the event nearly an hour past its scheduled start. 

The move reversed plans to appoint Patricio Montt, a former BHP Group executive and CEO of Los Andes Copper (CVE: LA), as mining minister.

Sources close to Kast told MINING.COM the decision was influenced in part by Los Andes Copper notifying the market that Montt, its general manager, would leave to join the incoming government before Kast had formally announced his cabinet.

The initial news sent Los Andes Copper shares soaring, with the stock closing up 21.79% on the Toronto Stock Exchange on Tuesday. By Wednesday, the rally had unwound as investors reassessed the cabinet change, with shares down 16.07% by noon local time and last trading 7.7% lower at $15.74 in mid-afternoon, valuing the company at about C$473 million.

Decision questioned

For a country where mining underpins economic growth, the decision to appoint a dual minister signals the sector is not a priority for the incoming administration, analysts and industry groups said. 

The Chilean Mining Chamber questioned both Man’s appointment and the merger of the two ministries, arguing the government missed a chance to name an experienced professional to lead what it called a sector that contributes more than any other to state revenues and the country’s global image. Manuel Viera, president of the chamber, said in a statement.

“This was an opportunity to appoint a professional linked to mining to lead the portfolio,” Viera said. “Today mining, despite being our national emblem and the activity that contributes the most resources to the public purse, is treated as second‑rate.”

Other industry associations said the merger weakens a portfolio they view as central to boosting productivity, competitiveness and investment at a time when Chile faces mounting global competition.

Criticism has focused not only on Man’s background as an agronomist with limited direct mining experience, but also on the symbolism of diluting a ministry long considered strategic to the economy. 

José Cabello, director of Mineralium Consulting Group, said the decision raised concerns about the government’s understanding of the sector’s importance. He warned that leaving the mining ministry under a dual mandate risks diluting leadership of Chile’s largest industrial activity.

“Mining is the country’s main economic engine and places Chile tentatively among the world’s top five producers by value,” he told MINING.COM, adding that he hopes the decision will be reconsidered in favour of appointing a minister with extensive industry experience and formal training, such as a mining engineer, metallurgist, chemist or geologist.

“Clearly the dual ministry was to the detriment of mining,” Juan Ignacio Guzman, head of mineral consulting firm GEM, added.

The incoming minister now faces the task of unlocking an estimated $105 billion backlog of mining investments, while revising proposed reforms to permitting and environmental assessment frameworks that companies say have slowed project approvals.

Power play

Kast used the cabinet ceremony to underline his authority, underscoring the president-elect’s desire to set the tone early.

Montt, who did not respond to requests for comment, had been widely seen as well placed to tackle Chile’s permitting challenges and to help deliver Kast’s pledges to accelerate projects and revive copper output.

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Chile holds the world’s largest copper and lithium reserves, minerals critical to the global energy transition, and supports more than 8,000 supplier companies seeking to expand abroad after decades of operating expertise.

In terms of production, Chile accounts for about a quarter of the global mined copper, but producers face declining ore grades and what they describe as burdensome red tape.

Mining association Sonami was among those advocating for a dedicated minister to give the sector full attention. “Clearly the dual ministry was to the detriment of mining,” said Juan Ignacio Guzman, head of mineral consulting firm GEM.

Before joining Los Andes Copper three years ago, Montt oversaw corporate affairs at BHP Minerals Americas for more than a decade. The company said Tuesday he would remain in his role until Feb. 19, with Antony Amberg taking over on an interim basis. Kast is set to be sworn in on March 11.