Florencia Heredia is a partner at Allende & Brea, one of the most prestigious and long-standing firms in Buenos Aires. She joined the firm in August 2017 after 26 years in the natural resources sector. She is an expert in mining law with extensive experience advising financing institutions and companies in complex mining and energy transactions in Argentina, having repeatedly represented lenders in all mining project finance taking place in the country. She participates in several international organisations. She is an active member of the International Bar Association, and is a former chair of its mining law committee (2015–2016) and a current council member of its energy, environment and natural resources law section.
Describe your career to date.
I have been a lawyer for 27 years, graduating summa cum laude from the Catholic University of Buenos Aires in December 1991; I gained several postgraduate degrees, from Austral University and other institutions. In 1992, I joined Estudio Beccar Varela in Buenos Aires and was a member and partner for almost 17 years; that is where I started my career in the natural resources sector. In 2008, and looking for new horizons I started Holt Abogados, a natural resources boutique law firm that performed successfully during a very difficult period for Argentina. Developments and changes in the country, and my personal views on the mining sector, created the need to evolve again; in August 2017 I joined Allende & Brea, one of the leading and most prestigious full-service firms. Thus, I have continued and enhanced my service to clients in the industry.
Throughout all these years I have always tried to combine my passion for the mining sector, representing clients in all areas of the industry, with advances in the research and academic aspects of the profession, considering, in particular, the increasing challenges in the extractives industries. I have actively participated, for many years, in international organisations such as the International Bar Association and the Rocky Mountain Mineral Law Foundation, which have been extremely relevant in shaping the mining industry in recent years.
Nowadays, in a more senior role, I advise clients in day-to-day business and on transactions – though most important is advising on the strategic developments of their businesses, both in Argentina and abroad, given my experience in the international arena.
What do you enjoy most about working in the mining sector?
I have always been very passionate about the mining sector, the challenges within the industry, and the different type of companies involved. It is indeed a fascinating industry, and an activity that – if well oriented and developed – can really change the lives of many people in different countries.
Through all these years of practice – and given the fact that I began when large-scale mining was starting to develop in Argentina – I have witnessed the evolution of the sector, the rise of new companies, the decline of others and, most important, the international trends that give shape to a global industry with local impact.
The interaction among companies, the government and communities is the key to successful projects and sometimes a difficult combination to articulate. As an expert lawyer in this field, I very much enjoy working with the ways and mechanics of these factors.
How has the legal market changed since you first started practising? What is the future of a profession facing new technologies?
The legal market has changed and is changing structurally, in my view. There is a trend toward more global law firms and a more business-oriented approach within the legal profession. Latin America is starting to become part of this trend – though in the case of Argentina, and given our political/economic difficulties, we are somehow off track with such developments.
Clients are inclined to value practical solutions more than lengthy analyses of a legal nature. Even when this depends heavily on the area of law and the nature of the advice, I still see this change. The world has become more dynamic, which sometimes goes against the essence of legal analysis.
In this regard, I should stress the role of lawyers adding value and views from a more holistic and integral perspective. I have always tried to work with focus and purpose, no matter if it makes my work more time-consuming or complex. I am a strong believer that lawyers have a very special role in terms of values and ethics, across all industries.
As an additional trend in the legal profession, new technologies and the impact of artificial intelligence mean some activities entrusted to lawyers will probably change. For example, the due diligence process may be subject to an important change; we may see the inclusion of smart contracts; and so on. Innovation in the legal profession is advancing and many activities will be more automated. This may be hard to believe, but is not too far in the future given the fast changes we experience in the world nowadays. In this respect, areas of law (depending on the legal system and countries) where there is a greater degree of discretionary power to be exercised by the state will probably survive this evolving trend. Interesting times lie ahead for new generations and for those who are responsible for running law firms.
Do you see anything in the new generation of lawyers that makes them substantially different from the previous ones?
I definitely see a change in their views towards the profession: more commitment to certain aspects related to social issues and the environment, though in line with a more balanced life. This means time devoted to work, and time devoted to other interests (not just family).
These different views, attitudes and values will also have an impact on the way work is done and will require different managing skills from the partners leading the teams.
In my view, this different approach from the new generation of lawyers will enrich the profession and contribute to a more diverse array of interests.
What is driving the increasing interest in lithium mining?
Interest in lithium mining is mainly driven by the estimated growth of the electric vehicle industry and a consequently large demand, driven especially by China.
However, it is important to note that there are two types of lithium extraction projects: hard rock and brine projects. Recently, there has been an increasing interest in brine projects in the so-called “lithium triangle” (Argentina, Bolivia and Chile) as well as Nevada in the USA; these types of projects are less expensive to run and operate than hard rock projects (which one sees a lot in Australia and Canada), though they are still very challenging from a hydrogeological perspective, and not much research in the various basins of Argentina has been conducted. The estimation is that very few of the prospective brine lithium projects in the salars (salt flats) of Argentina would become feasible.
In this respect, the next few years will be very interesting and will reveal the real players in the market.
Additionally, it is worth noting that lithium projects in salars mainly involve a chemical process and a different way of extracting the mineral; therefore the main companies operating relevant projects across the world are chemical or agro-chemical companies (eg, Albermarle, FMC and SQM – the last of these being the only mining chemical company).
Do you think that, with the impact of social media, there is an increasing pressure on mining companies to operate in a sustainable manner?
The impact of new media, especially social media, is definitively changing the way many industries operate. In the case of mining companies, sustainable development was included as a goal for operations many years ago. However, in practical and real terms, effective examples and enforcement of related principles in company policies have been seen lately.
New media has indeed played a role in this evolution. Communities have many interactive ways to communicate and this certainly puts pressure on company performance.
On a separate note, mining companies should work harder to communicate better with communities and local governments. Social media needs to become an essential part of such communication plan.
You were recently appointed a non-executive director of the Australian mining company Galaxy Lithium. What has been your experience in this respect?
It has been a very interesting and productive experience, allowing me to interact with the company at all levels and especially learn about the operations and projects from the inside.
Even when my expertise in the industry was the main reason for the appointment, the fact that I am a woman is not insignificant – there is an increasing trend for putting women on boards, especially in the extractive industries sector.
A more diverse view and exchange of opinions contributes to a more comprehensive overview of the mining operations.
Looking back over your career, what is the most interesting case you have been a part of?
Undoubtedly the financing of Bajo de la Alumbrera, which took place back in 1994–1995, was the most interesting case I have been part of in the mining sector. I was a very young lawyer and this was (and still is) a leading case of mining project finance. I was involved in all aspects of the due diligence and securities on behalf of the lenders being most of the legal issues addressed for the first time in Argentina.
Close behind that is the Potasio Rio Colorado Project, which until 2008 was owned by Rio Tinto – one of my long-standing clients. This was certainly a highlight of my career, given that it involved logistics over five provinces and very complex issues. Unfortunately, the project, now owned by Vale, has not started operations yet. It is unlikely that it will do.
Where, in your opinion, does the future of the mining sector lie?
The future of the mining sector is probably related to technological minerals (not necessarily limited to lithium – also cobalt, manganese) and copper, due to the continuous use of this metal in several industries, including technology.
International prices drive much of the trends regarding the industry as well as the needs of the world. In this sense food demand may trigger the need for potash as fertiliser, or – as mentioned above – the increased trend for electric vehicles triggers the need for technological minerals.
Argentina has a future connected to copper, and will regain its position in metalliferous mining if real and serious exploration returns to the country – mainly by large or medium-sized companies with professional exploration teams.