Brazil's Mato Grosso state sees major mining sector growth potential

Brazil’s Mato Grosso state is expecting its mining sector to grow in the coming years on the back of increased exploration.

The sector only operates on 0.5% of the state’s territory and has been held back due to the lack of a mining exploration tradition, said João Antônio Paes de Barros, a geologist at the state’s exploration company Metamat, in a statement.

Minas Gerais and Pará are the leading states both in terms of production and exploration, and Mato Grosso is ranked sixth.

Mato Grosso’s mining revenues amounted to 6.80bn reais (US$1.33bn) last year, with 80% of production being gold and limestone, and the remainder made up of the likes of manganese, tin, diamonds and zinc.

For many years the mining sector represented between 1.2% and 2.4% of Mato Grosso's GDP, and today it stands at 4.2%. This trend prompted the state to turn its eye on tax collection. 

In December, state legislators approved the TFRM tax on mineral exploration and production. The tax will come into effect on April 1 and the government expects annual collection of 200mn reais.

The Aripuanã underground polymetallic mine, owned by Brazilian firm Nexa Resources and located in the state, is likely to reach full production capacity this year. The mine produces zinc, copper, lead and silver.