Development of Peruvian mining projects during the last five years (2011-2015) not only did need USD 42,069 bn investment (Source: Ministry of Energy and Mines Peru – MINEM) but also the expertise of engineering firms which laid the groundwork for later construction, operation, maintenance, expansion and eventual closure stages of these projects.
The present study is a market participation analysis of Peruvian and international firms that provided engineering services covering Engineering, Environment and Geotechnic areas between 2011 and 2015, areas that for the purpose of this study will be denominated units. The ranking criteria for determining market participation of each of the companies credited in this ranking is the number of executed projects.
DIGISCEND invited engineering and consulting firms, which have active participation within Peruvian mining sector, to share data of their executed projects (type of service provided, delivery of service dates and mining project in question); other sources of public data such as from MINEM, press-releases and annual reports of the respective companies in this study was also used as a source of information in order to credit expertise to engineering firms.
Graph #1 shows the market participation considering all different Engineering, Environmental and Geotechnical units for the period 2011-2015. Anddes leads the ranking with 23.5% of market share; Anddes Asociados is a Peruvian company that started operations in Peru back in February 2011 and today it provides services in Argentina, Bolivia, Brazil, Chile, Ecuador, Mexico and Peru.
Considering turnover values would generate different ranking positions of engineering firms in comparison to results based on number of executed projects, GMI Ingenieros Consultores for example, a company belonging to Grupo Grana y Montero which offers consultancy and engineering services, had values of USD 399,771 MM as revenue during 2011-2015 period (Source: Annual reports Grupo Grana y Montero) having therefore a 7.9% approximately of total turnover for all Engineering, Environmental and Geotechnical units within the Peruvian sector, revenue that based on DIGISCEND ‘Fee Model’ calculation would be USD 5 bn for 2011-2015 period.
Continuing with the analysis of results based on number of executed projects, Graph #1 has been disaggregated into three units: Engineering, Environmental and Geotechnical obtaining as results a Graphs # 2, # 3 and # 7 respectively.
Results of Engineering unit (Graph # 2) are related to services: Detailed engineering, Feasibility studies, Pre-Feasibility studies, Conceptual engineering, Basic engineering, Engineering & Procurement (EP), EPCM and Construction management (CM). In the case of Environmental Unit (Graph # 3) considers Environmental Impact Assessments (EIA), Closure plans (CP), Semi-detailed EIAs as well as Environmental Impact Statement (EIS) services among the most important. Finally, Geotechnic unit (Graph # 7) comprises Geotechnical studies, Geology, Geophysics and Seismic hazard studies as the most representative services.
Graph #2 shows Anddes Asociados again leading the engineering unit ranking with 35% stake followed by GMI and Jacobs. Jacobs Peru, having a 9.9% of market share, specializes in providing engineering detail, feasibility studies, pre-feasibility, conceptual engineering, basic engineering, construction management, EPCM and since 2011 has delivered services to major mining companies such as Southern Peru Peru Copper Corporation, Chinalco, Volcan and Antamina.
Regarding Environmental & Social unit (Graph #3), it can be seen Walsh Peru leading the ranking with 18.7 % of market share. Market participation for this unit, after Walsh Peru, is kept at the same 8% level for 5 firms: Acomisa, Ecotec, SRK, Geades and Geoservice, achieving therefore a total of 40% of market participation as a group. By early 2016, there were 169 consulting firms listed and authorized by MINEM to prepare EIAs and 42 to prepare CPs, hence the fact of having a value of as much as 24.8% of market participation assigned to group of companies outside the top 10 companies leading this unit (others).
Splitting Environmental & Social unit into its main services such as preparation of: Environmental Impact Studies EIA (Graph #4); Closure Plans CP (Graph #5) and Environmental Impact Statements DIA (Graph #6), it can be identified Walsh Peru, Acomisa & Geades leading the ranking for each split service respectively.
It is important to notice from Graphs #4 and #6 that participation of consulting firms (other) which performed EIAs & EISs services, not listed among the top 10 leading the rankings, is considerable high (33.6% for the case of EIAs and 40.1% for EISs) due to the fact, as mentioned above, there were a considerable high number of firms authorized by MINEM to prepare EIAs and CPs. To this day this is still the same scenario; from December 28th 2016 onwards, SENACE is replacing MINEM and now it is responsible for reviewing and approving detailed EIAs as well as manage the registration of firms authorized to conduct environmental studies, as of early 2016 SENACE had 166 engineering firms qualified within mining sub-sector.
An additional component while developing mining projects, in addition to and as important as Engineering, Environmental & Social units, is related to geotechnical studies which as said before and for the purpose of this study is treated as Geotechnical unit. Geotechnical studies provides valuable information of soils and rocks characteristics which is used for respective design of civil works in mining projects. Graph # 7 shows market participation of firms delivering services within this unit.
In the same way that Environmental & Social unit was split in 03 different services, engineering unit can also be split in three main service groups: Detailed engineering (Graph #8); Feasibility studies, Pre-feasibility, Conceptual engineering, Basic engineering, Engineering & Procurement EP and EPCM (Graph #9) and Construction management CM (Graph #10).
The results highlight the expertise of Peruvian engineering and consulting firms. Cases of Anddes Asociados, GMI Ingenieros Consultores, Geoservice Engineering and Geoservice Ambiental, Acomisa, ZerGeosystem and SRK Consulting (SRK Consulting and SVS Ingenieros merged back in 2011) are important to notice as these companies are leading the Engineering sector in Peru having all together a grouped market share of 51% overall for the period 2011-2015.
This study is the first ever ranking of engineering firms for the Peruvian market, DIGISCEND will continue contacting companies that had an active response for the preparation of this ranking and will invite all other engineering companies delivering services to the Peruvian mining sector (domestic or foreign companies) to get contact in order to credit their expertise in future editions of these rankings. DIGISCEND is preparing already the Ranking of Engineering firms with 2016 data and will eventually release future rankings of new services such as construction, sales & rental of heavy machinery, etc.
DIGISCEND is also improving the accuracy of its ‘Fee Model’, model that once ready will complement the ranking analysis with additional variables such as turnover by type of service. Other attributes specific to services such as number of engineering hours for engineering services will also be considered for future ranking releases. DIGISCEND aims to set up the standard and benchmark for measuring firms market participation, firms that deliver services and products to leading industries within APEC region on which projects are executed.
HORIZONTE MINERO, an internacional Peru based mining and energy sector magazine, is the mining sector exclusive partner of all DIGISCEND ranking releases.