Mining and environmental bond: what it guarantees and how its insured value is calculated

Every mining concession contract carries a guarantee bond, known in the sector as the mining and environmental bond. The Mining Code requires it when the contract is signed, and its function is to cover compliance with mining and environmental obligations, the payment of fines and forfeiture.

The value to be insured changes with the stage of the contract:

• Exploration: 5 % of the annual exploration investment is insured.
• Construction and assembly: 5 % of the annual investment of that stage is insured.
• Production: 10 % of the estimated annual production multiplied by the mine-mouth price is insured.

The basis of that calculation comes from the investment planned or the production projected in the PTO, so it changes whenever those figures change. A bond calculated on an earlier production figure falls out of line with the mining file.

The bond must remain in force throughout the concession, during its extensions and for three further years. It is also a condition for other procedures under the title, because to extend the exploration stage you must show it is current and, to extend the contract, the Mining Authority verifies that it still covers the obligations.

The mine closure regulation issued in 2026 provided for specific financial guarantees for closure, but the regulation that must develop them has not yet been issued. In the meantime the Mining Code bond continues to apply, and it is advisable to have the closure cost estimated for when the new guarantee can be required.

We calculate the basis of the insured value with the figures in your file and check that the coverage and validity match what the regulation requires. The bond is issued by an insurer, and you arrange it with our supported calculation, so that you can explain where each value comes from. If the Mining Authority raises observations, we prepare the response with you. Approval of the bond is the authority's decision.