Shared processing capacity: ore toll milling in San Juan
In May 2026 it started milling and in June out came 200 kilos of doré. The interesting part is not the gold: it is whose plant it is. Challenger Gold put its Hualilán orebody into production in another miner's mill —Casposo, owned by Austral Gold, idle since 2019 and refurbished for USD 7 million—, with 150,000 tonnes a year guaranteed for three years. It is Argentina's first ore toll-milling agreement between miners, and — unlike what this very page claimed until August 2026 — its price is published: milling a tonne costs USD 93.75 and hauling it, USD 17.50. The number that explains everything is the comparison: starting this way cost USD 8.9 million of upfront capital; its own plant asks for USD 232 million. The same orebody enters production with 26 times less capital. On the other side, the province has ore waiting: Del Carmen declares 366,000 ounces of gold equivalent and has nowhere to mill them.
What the market is made of
This split is unlike any other we publish, and it is worth saying why. Today San Juan's toll-milling service is entirely captive: one plant provides it and one client uses it, with the volume committed. What is addressable is not that contract: it is the ore that still has nowhere to go.
The rule that moves it
Here the law does not create the market, but it decides who invoices it from within the province: Each one opens its own page, with the rule, since when it applies and its primary source.
enablesSan Juan: 80/60 local mining procurementThe Local Mining Development Law does not regulate toll milling, but it does define who may count as a local supplier against the targets of 60% purchasing and 80% employment. For a plant operator with idle capacity that works in its favor: the plant is an authorized operating establishment in the province, which is precisely the hardest requirement for a service provider coming from outside. A mill based in San Juan meets article 12 almost by definition.see the reform →What forces someone to pay for this
The underlying policy that opens up this demand. It is the same inference declared by the rules and the program pillars pushing in this direction.
the RIGI promise is keptWhich projects already buy this
This market does not float on its own: concrete megaprojects drive it. These are the ones moving demand for this niche — each with its investment and status.
Reactivation and deepening of the Gualcamayo gold and silver mine (San Juan): the 'Deep Carbonates (DCP)' project extends the mine life toward the sulfide orebody at depth…
see the project →Engineering, construction, operation and maintenance of new leach pads (phases 8 and 9) at Veladero Mine, to sustain gold production and exports…
see the project →The niche in depth
Who splits the market, where you get in, what pays and what could break it.
already in
split
It refurbished a plant idle since 2019 for USD 7 M and turned it into the country's first toll-milling business, with an anchor client and volume guaranteed for three years. It monetised its mill, not its reserves. As long as it is the belt's only available mill, it sets the price — and that price is now known: USD 75.00 per tonne of treatment plus a premium of up to USD 22.50 tied to gold recovery, meaning it earns more the better it mills. The premium is not a detail: it aligns the mill owner with the client's result, and it is what makes a scheme between competitors work.
It is the trade's structural competitor: toll milling is for starting, not for staying. Challenger has already published the PFS of its own plant — USD 232 M of startup capital for twelve years of production prob. When the deposit justifies the investment, the client leaves. A toll milling business is built on client rotation, not on loyalty.
Veladero and Gualcamayo have processing infrastructure at scale, but their circuit is valley and heap leaching, not grinding and flotation of high-grade veins: it is not the same service and it does not work for the same ore. Capacity exists in the province; compatible capacity is a different thing.
It is the shape the market would take if someone built it: modular grinding and flotation, mobile crushing, and toll milling contracts for the belt's small deposits. There is no installed local supply today — the provincial analysis itself declares it a gap.
This niche's gap is not about service: it is about the asset. What San Juan lacks is grinding and flotation capacity available to third parties, and it is worth saying why the large plants do not cover it:
Installed capacity is not compatible capacity. Veladero and Gualcamayo process at scale, but they leach: in valleys and in heaps. The toll milling this market calls for is grinding and flotation of high-grade veins. Counting the province's capacity without separating circuits gives a number that means nothing.
The viable shape is probably not another fixed plant. A plant is sunk long-term capital against rotating demand —the good client leaves when it grows—. Modular grinding and mobile crushing move to the ore instead of waiting for the ore to come, and there is no installed local supply today.
An idle asset is not scrap. That is the lesson of this case: Casposo was out of service since 2019, was rehabilitated with USD 7 million and became the country's only provider. It charged for its mill, not for its reserves.
And the barrier that NO LONGER exists: there is now something to bid against. Until August 2026 this page said that entering required pricing blind. It does not: the agreement's study publishes that milling costs USD 75.00 per tonne plus a recovery premium of up to USD 22.50, and the right of use, USD 8.06. Anyone entering knows exactly what number they are competing against.
USD 17.3-20.2 M/year, i.e. ALL of today's market. Casposo is the only plant providing toll milling in the province and holds the only contract in existence. While that agreement runs —33 months from May 2026— San Juan's toll-milling market is addressable by no one else.
What is addressable is not this contract: it is the next one. The ore that today has nowhere to go —Del Carmen declares 366,000 ounces of gold equivalent with no plant, plus the Hualilán satellites, Jagüelito and the Calingasta veins— and the window opens when this contract ends or when the exploration awarded in October 2025 confirms. With the tariff now published, that market can be sized: each campaign the size of the current one is worth on the order of USD 15 M/year of service.
The realistic way in is not buying a plant: it is mobile crushing and modular milling, which move to the ore and do not demand the sunk capital of a fixed plant. There is no local supply installed. And there is now something to bid against: USD 93.75 per tonne milled is what the incumbent charges today.
When you get paid, and what blocks it
effect
It is the niche that carries furthest the idea that an idle asset is not scrap: Casposo had been out of service since 2019, was rehabilitated with USD 7 million and its restart sustains more than 300 jobs, 99% from San Juan. The trades are plant trades and among the best paid in provincial mining —mill operator, flotation operator, mechanical and electrical plant maintenance, process control, laboratory— and they are perpetual as long as there is ore to grind, unlike construction jobs. And there is a second-order effect that is the whole argument: every toll milling agreement turns a small deposit, which alone did not justify a plant, into an operation that employs and buys. Symmetric risk, stated plainly: employment at a toll milling plant depends on it finding the next client when the current one builds its own, and today the market has one seller and one buyer. thesis
calculate it
Concentration It is the most concentrated market we publish, and in the strangest way: there is one seller and one buyer. Casposo is the only plant providing the service and Challenger the only client. That does two things at once: it gives the seller pricing power no other niche has, and it makes it fragile, because when that client builds its own plant the market goes back to zero. Potential demand, by contrast, is atomized: the belt's small deposits, each too small to justify its own plant and all of them together enough to fill several.
Who really pays?
This market has two possible clients and they are not the same business:
It is the contract that already exists, and it processes from 1 May 2026 with the first gold pour in June. What the client buys is not milling: it is entering production without putting up the capital of a plant.
The guaranteed volume travels 165 km of sealed highway and haulage is charged separately from processing, published in the agreement's study. It is a market that did not exist before: the toll-milling deal created it, because ore processed at its own mine site does not travel.
Del Carmen declares 366,000 ounces of gold equivalent with no plant and its re-tender was awarded in October 2025 with USD 56 million of exploration committed over three years. Add the Hualilán satellites, Jagüelito and the Calingasta veins. There is no local supply to serve them today — and now a number can be put on what it would be worth: each campaign the size of the current one is on the order of USD 15 million a year of service.
When the window opens
This is not «what breaks it»: it is the dashboard for entering at the right moment. And here the indicator is uncomfortable, because what closes the market is the client's success.
Toll milling is for starting, not for staying. The client that today sustains the country's only contract has already published the study for its own plant —1.5 million tonnes a year of flotation plus an 8 million tonne heap leach circuit— and its feasibility study is under way. The day it takes the investment decision, the toll milling contract ends and the market is left without a client. What has to be watched in parallel, and is what would replace it, is the exploration of Del Carmen and Jagüelito: awarded in October 2025 with USD 56 million committed over three years and an option to mine. If it confirms, the next feed appears; if not, the market depends on a single contract.
Toll milling is for starting, not for staying. Challenger has already published the study for its own plant: USD 232 million of startup capital for twelve years of sustained production prob. The day the deposit justifies that investment, the toll milling contract ends. A business like this is built on client rotation, not on loyalty.
This is the trade's real risk, and it replaces the one this entry used to list —«there is no public tariff»— which turned out to be false. The country's entire toll-milling market is one contract: 33 months from May 2026, one provider and one client. When it ends, or when the client builds its own plant, billing drops to zero at once. There is no portfolio to cushion it.
Veladero and Gualcamayo have processing infrastructure at scale, but they leach: in valleys and in heaps. The toll milling this market calls for is grinding and flotation of high-grade veins. Counting the province's capacity without separating circuits gives a number that means nothing.
A fixed plant amortizes over years and its client base changes. That is why the viable shape is probably not another plant, but modular grinding and mobile crushing, which move to the ore.
Del Carmen and Jagüelito were re-tendered in October 2025 with USD 56 million of exploration committed over three years and an option to mine. Until that exploration confirms, future toll milling demand is a thesis, not a pipeline.
How the number is built · and how fresh each data point is
The figure is built from two things and both are published in the same document: what the tonne costs and how many tonnes there are. Change one and the total is recomputed.
The number rests on a few variables. The formula shows how it moves when each one changes; and each variable carries its freshness seal — how often it is worth revisiting. estim
How we validate this figure
This page got it wrong, and it is worth telling how. Until 30 August 2026 it said —as its main conclusion— that the toll-milling tariff does not exist publicly in Argentina, and treated that as *verified by absence in the source*. It was false. The error was not one of reading but of choosing the document: two primary sources had been opened, the first-pour release and the standalone-plant study, and neither of them is the toll-milling agreement's document. The third one —the Australian market release of the pre-feasibility study of the agreement, dated 4 June 2025— publishes the price line by line. We opened it, read it and redid the whole figure: it went from USD 1.7-3.0 million a year to USD 17.3-20.2 million.The lesson, worth more than the number: *«there is no public data»* can only be asserted after opening the document where that datum would have to be. The four tariffs on this page are now verified data; the only thing left as an estimate is how many tonnes are milled per year, because the same issuer gives two figures measuring different things —the floor the contract guarantees and the rate the production plan schedules, compressed into a 33-month campaign— and we use the band between them rather than picking the convenient one.And a contradiction we ourselves had flagged fell away. Our review had marked the agreement's economics as unreconciled, because it saw two different results from the same company. There was no contradiction: there were two gold-price assumptions. The study projects USD 88.0 million of operating result with gold at USD 2,500 an ounce and USD 142.8 million with gold at USD 3,300, and the A$ 221 million in the headline are those same USD 142.8 million converted into Australian dollars.⚠️ What this figure still is not: a market tariff. It is the price of a single contract, declared by the payer in its own study, and with an expiry date: 33 months from May 2026.
How to cite this figure: Despegue (2026). Shared processing capacity: ore toll milling in San Juan · San Juan. despegueargentina.com/en/san-juan/procesamiento-compartido-maquila-mineral · terms of use
Where the capital is best placed · the neighboring markets of Mine core, compared
There are 5 RIGI projects in San Juan that will buy from this trade, and each one opens its window in a different phase. You already have 4 named competitors on this page. We cross what your company makes or does against the projects that buy this sector and tell you which ones you fit into, when each one buys and through which door. Two pages, with the evidence behind them.
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