TABLE OF CONTENTS

			Page

INTRODUCTION		1

PART I		2

ITEM 1.	Identity of Directors, Senior Management and Advisers	32

ITEM 2.	Offer Statistics and Expected Timetable	32

ITEM 3.	Key Information	32

ITEM 4.	Information on the Company	2319

ITEM 4A.	Unresolved Staff Comments	8262

ITEM 5.	Operating and Financial Review and Prospects	8362

ITEM 6.	Directors, Senior Management and Employees	~~127~~112

ITEM 7.	Major Shareholders and Related Party Transactions	118

ITEM 8.	Financial Information	119

ITEM 9.	The Offer and Listing	122

ITEM 10.	Additional Information	123

ITEM 11.	Quantitative and Qualitative Disclosures About Market Risk	132

ITEM 12.	Description of Securities Other Than Equity Securities	132

PART II		135

ITEM 8.	~~Financial Information~~	~~137~~

~~ITEM 9.~~	~~The Offer and Listing~~	~~140~~

~~ITEM 10.~~	~~Additional Information~~	~~142~~

~~ITEM 11.~~	~~Quantitative and Qualitative Disclosures About Market Risk~~	~~152~~

~~ITEM 12.~~	~~Description of Securities Other Than Equity Securities~~	~~153~~

~~PART II~~
~~ITEM~~ 13.	Defaults, Dividend Arrearages and Delinquencies	~~155~~135

ITEM 14.	Material Modifications to the Rights of Security Holders and Use of Proceeds	~~155~~135

ITEM 15.	Controls and Procedures	~~155~~135

ITEM 16A.	Audit Committee Financial Expert	~~157~~136

ITEM 16B.	Code of Ethics	~~157~~136

ITEM 16C.	Principal Accountant Fees and Services	~~157~~137

ITEM 16D.	Exemptions from the Listing Standards for Audit Committees	~~158~~137

ITEM 16E.	Purchases of Equity Securities by the Issuer and Affiliated Purchasers	~~158~~137

ITEM 16F.	Change in Registrant’s Certifying Accountant	~~158~~137

ITEM 16G.	Corporate Governance	~~158~~137

ITEM 16H.	Mine Safety Disclosure	~~159~~138

PART III		139

ITEM 17.	Financial Statements	~~159~~139

ITEM 18.	Financial Statements	~~159~~139

ITEM 19.	Exhibits	~~160~~139

INTRODUCTION

Presentation of Financial Information

As used in this Annual Report on Form 20-F, or ~~Annual~~“Annual Report,” unless the context otherwise requires, references to “we,” “us,” “our,” “Company,” “BVN” and “Buenaventura” mean Compañía de Minas Buenaventura S.A.A. and its consolidated subsidiaries. Unless otherwise specified or the context otherwise requires, references to “$,” “US$,” “Dollars” and “U.S. Dollars” are to United States Dollars, and references to “S/.,” ~~“Nuevo Sol”~~“Sol” or ~~“Nuevos Soles”~~“Soles” are to Peruvian ~~Nuevos~~ Soles, the legal currency of the Republic of Peru, or ~~Peru.~~“Peru.”

Unless otherwise specified, references to a value denominated in “t” or “tons” refers to tons; references to a value denominated “DST” refers to dry short tons; the terms “g” or “gr” refer to metric grams; the terms “oz.” or “ounces” refer to troy ounces of a fineness of 999.9 parts per 1,000, equal to 31.1035 grams.

Until December 31, 2010, we presented our consolidated financial statements, which we refer to as our Financial Statements, in conformity with accounting principles generally accepted in Peru, or ~~Peruvian~~“Peruvian GAAP.” Effective January 1, 2011, we ~~changed the accounting principles governing the presentation of~~began presenting our consolidated financial statements ~~from Peruvian GAAP to~~in accordance with International Financial Reporting Standards ~~or IFRS,~~(“IFRS”), as issued by the International Accounting Standards Board ~~or the IASB.~~(the “IASB”).

Pursuant to the rules of the United States Securities and Exchange Commission, or the SEC, this Annual Report includes certain separate financial statements and other financial information of Minera Yanacocha S.R.L., or ~~Yanacocha,~~“Yanacocha,” and Sociedad Minera Cerro Verde S.A.A., or ~~Cerro~~“Cerro Verde.” Yanacocha and Cerro Verde maintain their financial books and records in U.S. Dollars and present their financial statements in accordance with ~~accounting principles generally accepted in the United States of America, or U.S. GAAP, and~~ IFRS as issued by the ~~IASB, respectively. See Note 9 to the Financial Statements.~~IASB.

We record our investments in Yanacocha and Cerro Verde in accordance with the equity method as described in “Item 5. Operating and Financial Review and Prospects—Buenaventura—General” and Note ~~2.3(e)~~2.4(f) to the Financial Statements. Our partnership interest in Yanacocha was calculated at ~~43.65 percent~~43.65% for the years ended December 31, ~~2011~~2013, 2014 and ~~2012.~~2015. As of December 31, ~~2011~~2013, 2014 and ~~2012,~~2015, our equity interest in Cerro Verde was ~~19.35 percent and 19.58 percent, respectively.~~19.58%.

Forward-Looking Statements

~~Certain statements contained in this~~This Annual Report ~~are~~contains “forward-looking statements” as defined in the U.S. Private Securities Litigation Reform Act of 1995 and are intended to be covered by the safe harbor provided for under these sections. Our forward-looking statements are based on management’s assumptions and beliefs in light of the information currently available to it and may include, without limitation:

our, Yanacocha’s and Cerro Verde’s costs and expenses;

estimates of future costs applicable to sales;

estimates of future exploration and production results;

plans for capital expenditures;

expected commencement dates of mining or metal production operations; and

estimates regarding potential cost savings and operating performance.

The words “anticipate,” “may,” “can,” “plan,” “believe,” “estimate,” “expect,” “project,” “intend,” “likely,” “will,” “should,” “to be” and any similar expressions are intended to identify those assertions as forward-looking statements. In making any forward-looking statements, we believe that the expectations are based on reasonable assumptions. We caution readers that those statements are not guarantees of future performance and our actual results may differ materially from those anticipated, projected or assumed in the forward-looking statements. Important factors that can cause our actual results to differ materially from those anticipated in the forward-looking statements include:

our, Yanacocha’s and Cerro Verde’s results of exploration;

the results of our joint ventures and our share of the production of, and the income received from, such joint ventures;

commodity prices;

production rates;

geological and metallurgical assumptions;

industry risks;

timing of receipt of necessary governmental permits or approvals;

regulatory changes;

political risks;

inaccurate estimates of reserves orMineralized Material Not in ~~Reserve~~;Reserve;

anti-mining protests or other potential issues with local community relationships;

labor relations;

environmental risks; and

other factors described in more detail under “Item 3. Key ~~Information—~~Information — D. Risk Factors.”

Many of the assumptions on which our forward-looking statements are based are likely to change after our forward-looking statements are made, including, for example, commodity prices, which we cannot control, and our, Yanacocha’s and Cerro Verde’s production volumes and costs, some aspects of which we may or may not be able to control. Further, we may make changes to our business plans that could or will affect our results. We do not intend to update our forward-looking statements, notwithstanding any changes in our assumptions, changes in our business plans, our actual experience or other changes, and we undertake no obligation to update any forward-looking statements more frequently than required by applicable securities laws.

PART I

~~ITEM 1. Identity of Directors, Senior Management and Advisers~~

ITEM 1.

Identity of Directors, Senior Management and Advisers

Not applicable.

~~ITEM 2. Offer Statistics and Expected Timetable~~

ITEM 2.

Offer Statistics and Expected Timetable

Not applicable.

ITEM 3.

Key Information

~~ITEM 3. Key Information~~

Selected Financial Data

~~A. Selected Financial Data~~

Selected Financial Information and Operating Data

~~The following~~This information should be read in conjunction with, and is qualified in its entirety by reference to, the Financial Statements, including the notes thereto appearing elsewhere in this Annual Report. The selected financial information as of December 31, ~~2011~~2014 and ~~2012,~~2015 and for the years ended December 31, ~~2010, 2011~~2013, 2014 and ~~2012,~~2015, is derived from the consolidated ~~statement~~statements of financial position, consolidated statements of ~~income~~profit or loss and ~~statement~~consolidated statements of other comprehensive income, ~~respectively,~~ included in the Financial Statements appearing elsewhere in this Annual Report. The selected financial information as of December 31, 2011 and 2012, and for the years ended December 31, 2011 and 2012 has been derived from a consolidated statement of financial position, consolidated statements of profit or loss and consolidated statements of other comprehensive income, respectively, which are not included in this Annual Report. The report of ~~Medina,~~Paredes, Zaldívar, ~~Paredes~~Burga & Asociados S. Civil de R.L. (a member firm of Ernst & Young Global) on our ~~2010, 2011~~2013, 2014 and ~~2012~~2015 Financial Statements appears elsewhere in this Annual ~~Report.Our 2010, 2011~~Report. Our 2013, 2014 and ~~2012~~2015 Financial Statements are prepared and presented in accordance with IFRS as issued by the IASB, which differs in certain respects from U.S. GAAP. For periods up to and including the year ended December 31, 2010, we prepared our financial statements in accordance with Peruvian GAAP. Our consolidated financial statements for the year ended December 31, 2011 were the first that we prepared in accordance with IFRS as issued by the IASB. The operating data presented below are derived from our records and has not been subject to audit. The financial information and operating data presented below should be read in conjunction with “Item 5. Operating and Financial Review and Prospects—Buenaventura,” the Financial Statements and the related notes thereto and other financial information included in this Annual Report.

As of and for the year ended December 31,
2010 2011 2012
(In thousands of US$)⁽¹⁾
Income statement data:
IFRS⁽²⁾
Net sales 1,047,885 1,493,882 1,496,349
Royalty income 55,883 62,742 67,178
Total income 1,103,768 1,556,624 1,563,527

Operating costs:
Cost of sales, without considering depreciation and amortization (347,129 ) (446,163 ) (629,492 )
Exploration in units in operation (91,441 ) (109,355 ) (153,018 )
Depreciation and amortization (74,864 ) (96,381 ) (123,043 )
Royalties (52,270 ) (60,262 ) (37,667 )
Total operating costs (565,704 ) (712,161 ) (943,220 )
Gross income 538,064 844,463 620,307

Operating expenses:
Administrative expenses (107,237 ) (75,170 ) (99,295 )
Exploration in non-operating areas (36,105 ) (49,593 ) (95,491 )
Selling expenses (9,375 ) (11,617 ) (18,090 )
Reversal (provision) for impairment of long-lived assets 13,135 - (3,617 )
Excess of workers’ profit sharing - (6,221 ) (2,164 )
Reimbursement of exploration expenses on projects 15,013 - -

Other, net 10,653 2,513 16,584
Total operating expenses (113,916 ) (140,088 ) (202,073 )
Operating income 424,148 704,375 418,234

Other income (expenses), net:
Share in the results of associates under equity method 428,885 468,363 464,239
Interest income 8,203 11,827 9,486
Interest expense (12,271 ) (11,823 ) (8,290 )
Net gain (loss) from currency exchange difference (750 ) (675 ) 1,715
Total other income, net 424,067 467,692 467,150

Income before income tax 848,215 1,172,067 885,384
Income tax (123,326 ) (211,589 ) (142,594 )
Net income 724,889 960,478 742,790
Net income attributable to non-controlling interest 64,068 101,551 58,105

Net income attributable to Buenaventura 660,821 858,927 684,685

Basic and diluted earnings per share⁽³⁾⁽⁴⁾ 2.60 3.38 2.69

Basic and diluted earnings per ADS⁽³⁾⁽⁴⁾ 2.60 3.38 2.69
Dividends per share 0.46 0.56 0.60

Average number of shares outstanding 254,442,328 254,442,328 254,232,571

Statement of financial position data:
IFRS⁽²⁾
Total assets 3,279,346 3,953,549 4,588,653
Financial obligations 57,152 106,114 179,304
As of and for the year ended December 31,
2010 2011 2012
(In thousands of US$)⁽¹⁾
Capital stock 750,540 750,540 750,540
Shareholders’ equity 2,845,337 3,440,479 3,964,386

Operating data (unaudited):
Production⁽⁵⁾
Gold (oz.) 481,768 524,101 447,472
Silver (oz.) 14,840,678 16,724,717 18,884,824
Proven and probable reserves⁽⁶⁾
Gold (oz.) 1,772,000 1,485,000 1,385,000
Silver (oz.) 152,161,000 155,437,000 154,606,000

	As of and for the year ended December 31,
	2015			2014			2013⁽⁶⁾			2012⁽⁶⁾			2011⁽⁶⁾
	(In thousands of US$)⁽¹⁾
Statements of profit or loss data:
Continuing operations:
Operating income:
Net sales of goods		864,962			1,067,271			1,135,836			1,376,179			1,314,070
Net sales of services		54,488			71,642			79,585			46,664			42,023
Royalty income		32,414			36,867			44,185			67,178			62,742
Total operating income		951,864			1,175,780			1,259,606			1,490,021			1,418,835

Operating costs:
Cost of sales of goods, excluding depreciation and amortization		(537,713	)		(533,052	)		(513,165	)		(540,504	)		(365,831	)
Cost of services, excluding depreciation and amortization		(52,692	)		(81,487	)		(114,120	)		(30,739	)		(15,592	)
Exploration in operating units		(91,520	)		(97,852	)		(101,913	)		(103,215	)		(77,994	)
Depreciation and amortization		(242,465	)		(208,698	)		(159,140	)		(111,025	)		(71,392	)
Mining royalties		(27,407	)		(28,440	)		(30,402	)		(37,496	)		(58,546	)
Total operating costs		(951,797	)		(949,529	)		(918,740	)		(822,979	)		(589,355	)
Gross profit		67			226,251			340,866			667,042			829,480

Operating expenses:
Administrative expenses		(86,532	)		(101,102	)		(75,118	)		(94,118	)		(68,874	)
Exploration in non-operating areas		(30,610	)		(50,007	)		(32,805	)		(95,491	)		(49,568	)
Selling expenses		(19,481	)		(16,605	)		(14,842	)		(15,491	)		(8,214	)
Excess of workers’ profit sharing		-			-			(704	)		(2,164	)		(6,221	)
Impairment loss of long-lived assets		(11,255	)		-			-			-			-
Other, net		209			3,059			(2,154	)		19,172			4,523
Total operating expenses		(147,669	)		(164,655	)		(125,623	)		(188,092	)		(128,354	)
Operating profit (loss)		(147,602	)		61,596			215,243			478,950			701,126

Other income (expenses), net:
Share in the results of associates under equity method		(173,375	)		(74,600	)		(114,145	)		478,987			496,769
Finance costs		(27,622	)		(11,318	)		(9,896	)		(8,290	)		(11,823	)
Net gain (loss) from currency exchange difference		(13,683	)		(8,452	)		(7,192	)		1,855			(614	)
Gain on business combination		-			59,852			-			-			-

	As of and for the year ended December 31,
	2015			2014			2013⁽⁶⁾			2012⁽⁶⁾			2011⁽⁶⁾
	(In thousands of US$)⁽¹⁾
Finance income		11,026			8,408			6,621			9,486			11,827
Total other income (expenses), net		(203,654	)		(26,110	)		(124,612	)		482,038			496,159

Profit (loss) before income tax		(351,256	)		35,486			90,631			960,988			1,197,285
Current income tax		(14,225	)		(19,006	)		(57,328	)		(130,507	)		(168,191	)
Deferred income tax		(541	)		(47,006	)		(29,154	)		(12,451	)		(42,369	)
Profit (loss) from continuing operations		(366,022	)		(30,526	)		4,149			818,030			986,725
Discontinued operations:
Profit (loss) from discontinued operations⁽⁷⁾		(9,523	)		(31,114	)		(83,885	)		(57,510	)		2,159
Net profit (loss)		(375,545	)		(61,640	)		(79,736	)		760,520			988,884
Attributable to equity owners of the parent		(317,210	)		(76,065	)		(107,257	)		701,100			887,333
Attributable to non-controlling interest		(58,335	)		14,425			27,521			59,420			101,551
Net profit (loss)		(375,545	)		(61,640	)		(79,736	)		760,520			988,884
Basic and diluted profit (loss) per share attributable to equity holders of the parent⁽²⁾⁽³⁾		(1.25	)		(0.30	)		(0.42	)		2.76			3.49
Basic and diluted profit (loss) per ADS attributable to equity holders of the parent⁽²⁾⁽³⁾		(1.25	)		(0.30	)		(0.42	)		2.76			3.49
Basic and diluted profit (loss) per share attributable to equity holders of the parent, from continuing operations		(1.21	)		(0.18	)		(0.09	)		2.98			3.48
Dividends per share		-			0.03			0.31			0.60			0.56
Average number of common and investment shares outstanding		254,186,867			254,186,867			254,186,867			254,232,571			254,442,328
Statement of financial position data:

Total assets		4,547,181			4,672,274			4,552,267			4,622,447			3,969,613
Financial obligations		353,710			383,305			234,397			179,304			106,114
Capital stock		750,497			750,497			750,497			750,540			750,540
Total shareholders’ equity		3,389,236			3,762,125			3,824,421			4,011,879			3,470,242

Operating data (unaudited):

Production⁽⁴⁾
Gold (oz.)		371,344			438,426			462,856			447,472			524,101
Silver (oz.)		23,228,392			20,119,162			19,193,075			18,884,824			16,724,717
Proven and probable reserves⁽⁵⁾
Gold (oz.)		1,718,455			1,119,000			1,036,000			1,385,000			1,485,000
Silver (oz.)		158,608,375			139,699,000			136,464,000			154,606,000			155,437,000

(1)

Except per share, per ADS, outstanding shares and operating data.

(2)

Effective January 1, 2011, we changed the accounting principles governing our presentation of our consolidated financial statements from Peruvian GAAP to IFRS. Acccordingly, our financial information for the year ended December 31, 2010 has been presented in accordance with IFRS.

~~(3)~~

~~Income~~Profit (loss) per share has been calculated for each year as net ~~income~~profit (loss) divided by average number of shares outstanding during the year. As of ~~March~~December 31, ~~2010, 2011~~2014 and ~~2012,~~2015, we had 274,889,924 ~~outstanding~~ Common Shares outstanding, including ~~21,130,260~~21,174,734 treasury ~~shares.~~shares as of December 31, 2014 and 2015. As of ~~March~~December 31, ~~2010,~~ 2011, 2012, 2013, 2014 and ~~2012,~~2015, we had 744,640 ~~outstanding~~of Investment Shares outstanding, including 61,976 treasury shares as of ~~March~~December 31, ~~2010 and~~ 2011, ~~and~~ 231,733 treasury shares as of ~~March~~December 31, ~~2012.~~2012, 272,963 treasury shares as of December 31, 2013, 2014 and 2015.

~~(4)~~(3)

We have no outstanding options, warrants or convertible securities that would have a dilutive effect on earnings per share. As a result, there is no difference between basic and diluted earnings per share or ADS.

~~(5)~~(4)

The amounts in this table reflect the total production of all of our consolidated subsidiaries, including Sociedad Minera El Brocal S.A.A., or El“El Brocal,” in which we owned a ~~53.76%~~54.07% controlling equity interest, and Minera La Zanja S.R.L., or La“La Zanja,” in which we owned a 53.06% controlling equity interest, in each case as of December 31, ~~2012.~~2015. The production data in this table reflect 100% of El Brocal’s and La Zanja’s production. For the years ended December 31, ~~2010, 2011 and~~ 2012 to 2015, El Brocal produced 3.1 million, 2.0 million, 2.5 million ~~2.9 million~~ and ~~2.8~~3.7 million ounces of silver, ~~respectively,~~ of which our equity share was ~~1.2~~1.7 million, ~~1.6~~1.1 million, 1.4 million and ~~1.4~~2.0 million ounces of silver, and La Zanja produced ~~43,727, 134,190~~112,387, 137,395, 143,573 and ~~112,387~~141,071 ounces of gold, ~~respectively,~~ of which our equity share was ~~23,201, 71,201~~59,633, 72,902, 76,180 and ~~59,633~~74,852 ounces of gold, and ~~38,155, 363,927~~387,877, 391,832, 422,395 and ~~387,877~~331,080 ounces of silver, ~~respectively,~~ of which our equity share was ~~20,245, 193,100~~205,808, 207,906, 224,123 and ~~205,808~~175,671 ounces of silver.

~~(6)~~(5)

The amounts in this table reflect the reserves of all of our consolidated subsidiaries, including El Brocal, in which we owned a 54.07% controlling equity interest, and La Zanja, in which we owned a 53.06% controlling equity interest, in each case as of December 31, 2015. The conceptual framework used to estimate proven and probable reserves for our wholly-owned mines as of December 31, ~~2010~~2012 and ~~2011~~2013 were reviewed by an independent consultant Algon Investment S.R.L. ~~Algon Investment S.R.L. is in the process of reviewing the framework used to estimate proven~~ and ~~probable reserves for our wholly-owned mines~~Geomineria S.A.C. as of December 31, ~~2012.~~2014 and 2015. The conceptual framework used to estimate proven and probable reserves for El Brocal’s mines as of December 31, ~~2010~~2012, 2013 and ~~2011~~2014 were reviewed by an independent ~~consultants, AMEC plc and MINTEC Inc., respectively. MINTEC Inc.~~consultant, which is also in the process of reviewing the conceptual framework used to estimate proven and probable reserves for El Brocal’s mines as of December 31, ~~2012.~~

2015.

(6)

IFRIC 20 “Stripping Costs in Production Phase of a Surface Mine” became effective January 1, 2013. Our results for the year 2012 and 2011 include adjustments in connection with the application of IFRIC 20 “Stripping Costs in the Production Phase of a Surface Mine.”

(7)

In 2014, we publicly announced our decision to dispose of our four non-operational mining units (Poracota, Recuperada, Antapite and Shila-Paula); as a consequence, they are presented as mining units held for sale in accordance with IFRS 5 “Non-current Assets Held for Sale and Discontinued Operations.” See Note 1(e) to the Financial Statements. For comparative purposes, we modified figures for 2010, 2011, 2012 and 2013 which were previously reported in our Form 20-F for the year ended December 31, 2013.

Yanacocha Selected Financial Information and Operating Data

The following table presents selected financial information and operating data for Yanacocha at the dates and for each of the periods indicated. This information should be read in conjunction with, and is qualified in its entirety by reference to, Yanacocha’s audited consolidated financial statements as of December 31, ~~2011~~2014 and ~~2012~~2015 and for the years ended December 31, ~~2010, 2011~~2013, 2014 and ~~2012,~~2015, or the ~~Yanacocha~~“Yanacocha Financial Statements.” The report of ~~Dongo-Soria Gaveglio y~~Paredes, Zaldívar, Burga & Asociados S. Civil de R.L. (a member firm of Ernst & Young Global) on the Yanacocha 2015 Financial Statements appears elsewhere in this Annual Report. The 2014 and 2013 Annual Reports were audited by Gaveglio, Aparicio y Asociados Sociedad Civil de Responsabilidad Limitada, a member firm of PricewaterhouseCoopers Limited. The selected financial information as of ~~December 31, 2008, 2009 and 2010~~ and for the ~~years~~year ended December 31, ~~2008 and 2009~~2012 has been derived from ~~balance sheets and~~Yanacocha’s financial statements ~~of income, respectively, which~~that are not included in this Annual Report. The Yanacocha Financial Statements are prepared and presented in accordance with ~~U.S. GAAP,~~IFRS as issued by the IASB, which ~~differ~~differs in certain respects from ~~IFRS. See~~U.S. GAAP, as indicated in Note ~~9(e.1)~~25 to the Yanacocha Financial ~~Statements for a reconciliation to U.S. GAAP of net income and shareholders’ equity as of and for the years ended December 31, 2010, 2011 and 2012.~~Statements. The operating data presented below, which are based on ~~100 percent~~100% of Yanacocha’s production and reserves, are derived from Yanacocha’s records and have not been subject to audit. The financial information presented below should be read in conjunction with “Item 5. Operating and Financial Review and ~~Prospects-Yanacocha,~~Prospects –Yanacocha,” the Yanacocha Financial Statements and the related notes thereto and other financial information included in this Annual Report.

As of and for the year ended December 31,
2008 2009 2010 2011 2012
(In thousands of US$)⁽¹⁾

Income statement data:
U.S. GAAP

Revenues 1,612,618 2,013,228 1,778,260 2,002,602 2,201,815

Costs and expenses:
Costs applicable to sales (659,867 ) (671,055 ) (655,007 ) (738,336 ) (694,146 )
Depreciation, depletion and amortization (169,131 ) (166,053 ) (160,424 ) (231,520 ) (252,900 )
Reclamation and remediation (11,174 ) (13,016 ) (14,632 ) (19,135 ) (20,090 )
Exploration costs (28,151 ) (22,968 ) (34,549 ) (66,272 ) (121,724 )
Write-down of long-lived assets (442 ) (2,923 ) (312 ) (1,864 ) (17,577 )
General and administrative costs (3,168 ) (3,602 ) (3,824 ) (1,281 ) (3,021 )
Other expenses (71,808 ) (70,530 ) (54,208 ) (39,193 ) (109,974 )
Total operating expenses (943,741 ) (950,147 ) (922,956 ) (1,097,601 ) (1,219,432 )
Operating income 668,877 1,063,081 855,304 905,001 982,383
Interest expense and other 3,642 (712 ) 4,263 30,424 6,014
Pre-tax income 672,519 1,062,369 859,567 935,425 988,397
Income tax provision (196,057 ) (335,293 ) (269,673 ) (293,038 ) (361,857 )
Net income before cumulative effect of change in accounting principles 476,462 727,076 589,894 642,387 626,540
Cumulative effect of change in accounting principle, net - - - - -
Net income and comprehensive income 476,462 727,076 589,894 642,387 626,540

Statement of financial position data:
U.S. GAAP
Total assets 1,891,963 2,466,500 2,936,994 3,787,234 4,451,535
Total debt 205,618 178,336 1,959 - -
Partners’ equity 1,212,787 1,711,102 2,302,145 2,943,021 3,570,690
Operating data (unaudited):
Gold produced (oz.) 1,810,338 2,058,180 1,461,620 1,293,123 1,345,992
Gold proven and probable reserves (thousands of oz.) 24,850 22,362 21,538 20,295 18,500

	As of and for the year ended December 31,
	2015			2014			2013			2012
	(In thousands of US$)⁽¹⁾
Statement of comprehensive income:
Operating income:
Revenue from sales ⁽²⁾		1,031,174			1,165,299			1,406,825			2,146,641
Other operating income		10,625			30,300			37,207			22,861
Total gross income		1,041,799			1,195,599			1,444,032			2,169,502

Costs applicable to sales		(751,736	)		(920,300	)		(991,264	)		(832,116	)
Other operating costs		(2,524	)		(22,422	)		(28,672	)		(22,069	)
Total operating costs		(754,260	)		(942,722	)		(1,019,936	)		(854,185	)
Gross profit		287,539			252,877			424,096			1,315,317

Operating expenses:

Operating expenses, net		(82,846	)		(77,781	)		(77,534	)		(192,869	)
Administrative expenses		(26,325	)		(38,262	)		(67,064	)		(70,916	)
Selling Expenses		(3,534	)		(4,458	)		(3,740	)		(4,498	)
Impairment loss		―			(541,141	)		(1,038,548	)		―
Operating profit		174,834			(408,765	)		(762,790	)		1,047,034

Other income (expense), net:
Finance income		673			298			720			1,019
Finance costs		(22,734	)		(23,504	)		(18,745	)		(13,135	)
Net gain (loss) from currency exchange difference		(251	)		1,142			2,065			(1,216	)
		(22,312	)		(22,064	)		(15,960	)		(13,332	)

Income (loss) before income tax		152,522			(430,829	)		(778,750	)		1,033,702
Income tax benefit (expense)		(602,717	)		30,491			203,471			(385,827	)
Loss for the year		(450,195	)		(400,338	)		(575,279	)		647,875

Comprehensive income (loss):
Loss for the year		(450,195	)		(400,338	)		(575,279	)		647,875
Other comprehensive income (loss) to be reclassified as profit or loss in subsequent periods
Changes in the fair value of available-for-sale financial asset, net of tax effect		(757	)		(65	)		(226	)		1,129

U.S. GAAP
Gold sales		1,070,021			1,210,457			1,457,646	¹		2,201,815
Net income (loss)		(252,159	)		(31,914	)		140,997			626,540

Statement of financial position:
IFRS
Total assets		2,965,430			3,483,169			3,754,692			4,512,803
Total financial obligations		―			―			―			―
Issued capital		398,216			398,216			398,216			398,216
Total partners’ equity		2,228,825			2,679,777			3,080,050			3,655,555

U.S. GAAP
Total assets		4,209,818			4,569,497			4,511,964			4,541,535
Total equity		3,418,989			3,671,148			3,711,461			3,570,690

Operating data (unaudited)
Gold produced (oz.)		917,691			969,944			1,017,259			1,345,992
Gold proven and probable reserves (thousands of oz.)		17,639			17,436			18,345			18,500

(1)

Except operating ~~data.~~data

(2)

Royalties netted to sales

Cerro Verde Selected Financial Information and Operating Data

The following table presents selected financial information and operating data for Cerro Verde atas of the ~~dates~~end of and for each of the periods indicated. This information should be read in conjunction with, and is qualified in its entirety by reference to, Cerro Verde’s audited financial statements as of December 31, ~~2011~~2014 and ~~2012~~2015 and for the years ended December 31, ~~2010, 2011~~2013, 2014 and ~~2012,~~2015, or the ~~Cerro~~“Cerro Verde Financial Statements.” The selected financial information as of and for the years ended December 31, ~~2010~~2011 and 2012 has been derived from ~~a balance sheet~~Cerro Verde’s Financial Statements that isare not included in this Annual Report. The report of ~~Medina,~~Paredes, Zaldívar, ~~Paredes~~Burga & Asociados S. Civil de R.L. (a member firm of Ernst & Young Global) on Cerro Verde’s financial statements appears elsewhere in this Annual Report. The Cerro Verde Financial Statements are prepared and presented in accordance with IFRS as issued by the IASB, which differs in certain respects from U.S. ~~GAAP. Until December 31, 2010,~~GAAP, as indicated in Note 28 to the Cerro Verde ~~presented its financial statements in conformity with Peruvian GAAP.~~Financial Statements. The operating data presented below, which are based on ~~100 percent~~100% of Cerro Verde’s production and reserves, are derived from Cerro Verde’s records and have not been subject to audit. The financial information presented below should be read in conjunction with “Item 5. Operating and Financial Review and Prospects—Cerro Verde,” the Cerro Verde Financial Statements and the related notes thereto and other financial information included in this Annual Report.

As of and for the year ended December 31,

2010⁽²⁾
2011 2012
(In thousands of US$)⁽¹⁾
Income statement data:
IFRS⁽²⁾
Net sales 2,368,988 2,520,050 2,127,023
Total revenues 2,368,988 2,520,050 2,127,023
Costs of sales
Total costs of sales (645,959 ) (824,700 ) (801,571 )
Gross margin 1,723,029 1,695,350 1,325,452
Operating expenses
Selling expenses (76,638 ) (83,612 ) (78,674 )
Excess of workers’ profit sharing (34,427 ) (21,923 ) -
Expenses related to water plant (4,300 ) (13,670 ) (19,606 )
Voluntary contribution (41,081 ) - -
Other operating expenses (10,749 ) (16,865 ) (9,898 )
Total operating expenses (167,195 ) (136,070 ) (108,178 )
Operating income 1,555,834 1,559,280 1,217,274
Other income (expenses), net
Financial expense (101 ) (165 ) (6,951 )
Financial income 1,261 1,078 1,886
Exchange Difference, net 669 1,924 3,149
Total other income (expenses), net 1,829 2,837 (1,916 )

Profit before income tax 1,557,663 1,562,117 1,215,358

Income tax (483,270 ) (483,718 ) (443,288 )
Net income 1,074,393 1,078,399 772,070

Basic and diluted earnings per share 3.069 3.081 2.206
Dividends per share 2.714 - -

Average number of shares outstanding 350,056,012 350,056,012 350,056,012

Statement of financial position data:
IFRS⁽²⁾
Total assets 2,294,078 3,196,597 4,042,771
Total debt - - -
Capital stock 990,659 990,659 990,659
Shareholders’ equity 1,599,239 2,677,638 3,449,708

Operating data (unaudited):
Production:
Copper (in thousands of recoverable pounds) 667,363 647,234 594,474
Proven and probable reserves:
Copper (in thousands of metric tons) 3,571,531 3,977,211 4,194,537

	As of and for the year ended December 31,
		2015		2014		2013⁽²⁾		2012⁽²⁾		2011⁽²⁾
	(In thousands of US$)⁽¹⁾
Statement of comprehensive income:

Sales of goods		1,115,617		1,467,097		1,811,488		2,127,023		2,520,050
Costs of sales of goods		(862,004	)	(797,481	)	(795,064	)	(765,789	)	(824,700	)
Gross profit		253,613		669,616		1,016,424		1,361,234		1,695,350
Operating expenses
Selling expenses		(56,215	)	(54,210	)	(68,448	)	(78,674	)	(83,612	)
Excess of workers’ profit sharing				-		-		-		(21,923	)
Expense related to water plant				-		-		(19,606	)	(13,670	)
Other operating (expenses), income net		(26,600	)	(3,629	)	147		(9,898	)	(16,865	)
		(82,815	)	(57,839	)	(68,301	)	(108,178	)	(136,070	)
Operating profit		170,798		611,777		948,123		1,253,056		1,559,280
Other income (expenses)
Finance income		512		2,443		2,178		1,886		1,078
Finance costs		(16,010	)	(369	)	(1,843	)	(6,951	)	(165	)
Net gain (loss) from exchange differences		(75,770	)	2,284		(1,858	)	3,149		1,924
		(91,268	)	4,358		(1,523	)	(1,916	)	2,837

Profit before income tax		79,530		616,135		946,600		1,251,140		1,562,117

Income tax expense		(46,246	)	(238,529	)	(333,338	)	(454,556	)	(483,718	)
Profit for the year		33,284		377,606		613,262		796,584		1,078,399

Basic and diluted earnings per share		0.095		1.078		1.752		2.276		3.081
Dividends per share				–		–		–		–

Weighted average number of shares outstanding		350,056,012		350,056,012		350,056,012		350,056,012		350,056,012

Statement of financial position data:

Total assets		7,852,692		5,771,984		4,828,201		4,042,771		3,196,597
Total financial obligations		2,425,164		452,849		5,903		–		–
Issued capital		990,659		990,659		990,659		990,659		990,659
Total equity, net		4,498,374		4,465,090		4,087,484		3,449,708		2,677,638

Operating data (unaudited):
Production:
Copper (in thousands of recoverable pounds)		544,482		500,242		557,239		594,474		647,234
Proven and probable reserves:
Copper Ore (in thousands of tons)		3,855,939		3,953,234		4,047,372		4,194,537		3,977,211

(1)

Except per share and operating ~~data~~data.

(2)

~~Effective~~IFRIC 20 became effective January 1, ~~2011, Cerro Verde changed the accounting principles governing the presentation of its consolidated financial statements from Peruvian GAAP to IFRS. Accordingly, Cerro Verde’s financial information~~2013. Our results for the year ~~ended December 31, 2010 has been presented~~2012 include adjustments in ~~accordance~~connection with ~~IFRS.~~the application of IFRIC 20 “Stripping Cost in the Production Phase.” See Note 32.2 to the Cerro Verde Financial Statements.

~~Exchange Rates~~

The following table sets forth the high and low month-end rates and the average and end-of-period offered rates for the sale of Nuevos Soles in U.S. Dollars for the periods indicated, as published by the~~Superintendencia de Bancos y Seguros~~ ~~(Superintendent of Bank and Insurance, or the SBS). The Federal Reserve Bank of New York does not report a noon buying rate for Nuevos Soles.~~

Exchange Rates

~~(Nuevos~~

The following table sets forth the high and low month-end rates and the average and end-of-period offered rates for the sale of Soles ~~per US$~~in U.S. Dollars for the periods indicated, as published by theSuperintendencia de Banca y Seguros (Superintendent of Bank and Insurance, or the “SBS”)⁽¹⁾. The Federal Reserve Bank of New York does not report a noon buying rate for Soles.

Year High⁽²⁾ Low⁽²⁾ Average⁽³⁾ Period end⁽⁴⁾

2008 3.141 2.690 2.922 3.139
2009 3.259 2.853 3.012 2.891
2010 2.856 2.787 2.826 2.809
2011 2.834 2.694 2.755 2.697
2012 2.710 2.551 2.640 2.551

High⁽⁵⁾ Low⁽⁵⁾ Average⁽⁶⁾ Period end⁽⁷⁾
2012
October 2.602 2.578 2.588 2.592
November 2.616 2.579 2.599 2.579
December 2.581 2.551 2.568 2.551

2013
January 2.578 2.541 2.552 2.578
February 2.587 2.567 2.579 2.587
March 2.604 2.586 2.595 2.589

Exchange Rates
(Soles per US$)⁽¹⁾

Year	High⁽²⁾		Low⁽²⁾		Average⁽³⁾		Period end⁽⁴⁾
2013		2.820		2.541		2.702		2.796
2014		2.990		2.761		2.840		2.989
2015		3.413		2.983		3.187		3.408

2015	High⁽⁵⁾		Low⁽⁵⁾		Average⁽⁶⁾		Period end⁽⁷⁾
October		3.288		3.218		3.250		3.287
November		3.385		3.287		3.339		3.376
December		3.413		3.369		3.385		3.413

2016
January		3.471		3.417		3.439		3.471
February		3.538		3.478		3.508		3.527
March		3.522		3.328		3.410		3.328

(1)

Expressed in nominal (not inflation adjusted) ~~Nuevos~~ Soles.

(2)

Highest and lowest of the twelve month-end exchange rates for each year based on the offered rate.

(3)

Average of month-end exchange rates based on the offered rate.

(4)

~~End of period~~End-of-period exchange rates based on the offered rate.

(5)

Highest and lowest of the exchange rates based on the offered rate on the last day of each month.

(6)

Average of the exchange rates based on the offered rate on the last date of each day in the relevant month.

(7)

The exchange rate based on the offered rate on the last day of each relevant month.

Source: ~~SBS~~Bloomberg

On April ~~25, 2013,~~28, 2016, the offered rate for Dollars as published by the SBS was S/~~.2.624 =~~.3.29 per US$1.00.

~~B. Capitalization and Indebtedness~~

Capitalization and Indebtedness

Not applicable.

~~C. Reasons for the Offer and Use of Proceeds~~

Reasons for the Offer and Use of Proceeds

Not applicable.

Risk Factors

~~D. Risk Factors~~

Factors Relating to the Company

Our financial performance is highly dependent on the performance of our partners under our mining exploration and operating agreements.

Our participation in joint venture mining exploration projects and mining operations with other experienced mining companies is an integral part of our business strategy. Our partners, co-venturers and other shareholders in these projects generally contribute capital to cover the expenses of the joint venture or provide critical technological, management and organizational expertise. The results of these projects can be highly dependent upon the efforts of our joint venture partners and we rely on them to fulfill their obligations under our agreements. For example, our Yanacocha joint venture with Newmont Mining Corporation, a Delaware corporation, or Newmont Mining, ~~is dependent upon~~depends on Newmont Peru Limited, Peruvian Branch, or ~~Newmont~~“Newmont Peru,” to provide management and other expertise to the Yanacocha project. If our counterparts do not carry out their obligations to us or to third parties, or any disputes arise with respect to the parties’ respective rights and obligations, the value of our investment in the applicable project could be adversely affected and we could incur significant expense in enforcing our rights or pursuing remedies. ~~There can be no assurance~~We cannot assure you that our current or future partners will fulfill their obligations under our agreements. In addition, we may be unable to exert control over strategic decisions made in respect of such properties.For example, we currently depend on Newmont Peru to conduct operations at Yanacocha and the Conga project, and s~~hould~~should Yanacocha be unable to continue with the current development plan at the Conga project, our mining partners in this project may reprioritize and reallocate capital to development alternatives. See “Item 4. Information on the ~~Company—~~Company – Yanacocha” and “Item 4. Information on the ~~Company—Buenaventura—~~Company – Buenaventura – B. Business ~~Overview—~~Overview – Exploration.”

Our financial performance is highly dependent on the prices of gold, silver, copper and other metals.

The results of our operations are significantly affected by the market price of specific metals, which are cyclical and subject to substantial price fluctuations. Our revenues ~~are derived primarily from the sale of ore concentrates containing gold~~ and ~~silver;~~ the revenues of Yanacocha, in which we have a material equity investment, are derived primarily from the sale of gold and ~~silver;~~silver, and the revenues of Cerro Verde, in which we have a material equity investment, are derived primarily from copper sales. The prices that we, Yanacocha and Cerro Verde obtain for gold, silver, copper and ore concentrates containing such metals, as applicable, are directly related to world market prices for such metals. Such prices have historically fluctuated widely and are affected by numerous factors beyond our control, including (i) the overall demand for and worldwide supply of gold, silver, copper and other ~~metals,~~metals; (ii) levels of supply and demand for a broad range of industrial products; (iii) the availability and price of competing ~~commodities,~~commodities; (iv) international economic ~~trends,~~and political trends; (v) currency exchange fluctuations (specifically, the U.S. Dollar relative to other currencies); (vi) expectations with respect to the rate of ~~inflation,~~inflation; (vii) interest rates; (viii) actions of commodity markets ~~participants, consumption~~participants; and ~~demand patterns and~~(ix) global or regional political ~~events in major producing countries.~~ or economic crises.

We have in the past engaged in hedging activities, such as forward sales and option contracts, to minimize our exposure to fluctuations in the prices of gold, silver and other metals; however, we and our wholly-owned subsidiaries no longer hedge the price at which our gold and silver will be sold. In addition, neither Yanacocha nor Cerro Verde engages in hedging activities. As a result, the prices at which we, Yanacocha and Cerro Verde sell gold, silver, copper and ore concentrates, as applicable, are fully exposed to the effects of changes in prevailing market ~~prices.See~~prices. See “Item 11. Quantitative and Qualitative Disclosures About Market Risk” and Note 2833 to the Financial Statements. For information on gold and silver prices for each of the years in the five-year period ended December 31, ~~2011,~~2015, see “Item 4. Information on the ~~Company—Buenaventura—~~Company – Buenaventura – B. Business ~~Overview—Sales~~Overview –Sales of Metal Concentrates.”

On December 31, ~~2012,~~2015 and March 31, ~~2013 and April 24, 2013,~~2016, the morning fixing price for gold on the London Bullion Market was US$~~1,664per ounce, US$1,602~~1,060.25 per ounce and US$~~1,451~~1,233.6 per ounce, respectively. On December 31, ~~2012~~2015 and March 31, ~~2013,~~2016, the afternoon fixing spot price of silver on the London market, or ~~London~~“London Spot,” was US$~~29.95per~~13.82 per ounce and US$~~28.64per~~15.38 per ounce, respectively. On December 31, ~~2012~~2015 and March 31, ~~2013,~~2016, the London Metal Exchange Settlement price for copper was US$~~7,915,~~4,702 per ~~metric~~ ton and US$~~7,582,~~4,855.5, per ~~metric~~ ton, respectively.

The world market prices of gold, silver and copper have historically fluctuated ~~widely and there is no assurance that the prices for these metals will continue to maintain their current high historical levels.~~widely. We cannot predict whether metal prices will rise or fall in the future. A continued decline in the market price of one or more of these metals could adversely impact our revenues, net income and cash flows and adversely affect our ability to meet our financial obligations.

~~In addition, sustained low~~ If prices of gold, silver and/or copper ~~prices~~should decline below our cash costs of production and remain at such levels for any sustained period, we could determine that it is not economically feasible to continue production at any or all of our mines. We may also curtail or suspend some or all of our exploration activities, with the result that our depleted reserves are not replaced. This could further reduce revenues ~~further through production declines due to cessation of the mining of deposits,~~by reducing or ~~portions of deposits, that have become uneconomic at the then-prevailing market price; reduce or eliminate~~eliminating the profit that we currently expect from reserves; halt or delay the development of new projects; reduce funds available for exploration; and reduce existing reserves by removing ores from reserves that can no longer be economically processed at prevailing prices.reserves. Such declines in price and/or reductions in operations could ~~also~~ cause significant volatility in our financial performance and adversely affect the trading prices of our Common Shares and ADSs.

Economic, mining and other regulatory policies of the Peruvian government, as well as political, regulatory and economic developments in Peru, may have an adverse impact on our, Yanacocha’s and Cerro Verde’s businesses.

Our, Yanacocha’s and Cerro Verde’s activities in Peru require us to obtain mining concessions or provisional permits for exploration and processing concessions for the treatment of mining ores from the Peruvian Ministry of Energy and Mines ~~or MEM.~~(the “MEM”). Under Peru’s current legal and regulatory regime, these mining and processing rights are maintained by meeting a minimum annual level of production or investment and by the annual payment of a concession fee. A fine is payable for the years in which minimum production or investment requirements are not met. Although we are, and Yanacocha and Cerro Verde have informed us that they are, current in the payment of all amounts due in respect of mining and processing concessions, failure to pay such concession fees, processing fees or related fines for two consecutive years could result in the loss of one or more mining rights and processing concessions, as the case may be.

Mining companies are also required to pay the Peruvian government mining royalties and/or mining taxes. See “Item 4. Information on the ~~Company—Buenaventura—~~Company – Buenaventura – B. Business ~~Overview—~~Overview – Regulatory ~~Framework—~~Framework – Mining Royalties and Taxes.” ~~There can be no assurance~~We cannot assure you that the Peruvian government will not impose additional mining royalties or taxes in the future or that such mining royalties or taxes will not have an adverse effect on our, Yanacocha’s or Cerro Verde’s results of operations or financial condition. Future regulatory changes, changes in the interpretation of existing regulations or stricter enforcement of such regulations, including changes to our concession agreements, may increase our compliance costs and could potentially require us to alter our operations. We cannot assure you that future regulatory changes will not adversely affect our business, financial condition or results of operations.

Environmental and other laws and regulations may increase our costs of doing business, restrict our operations or result in operational delays.

Our, Yanacocha’s and Cerro Verde’s exploration, mining and milling activities, as well our and Yanacocha’s smelting and refining activities, are subject to a number of Peruvian laws and regulations, including environmental laws and regulations.

Additional matters subject to regulation include, but are not limited to, concession fees, transportation, production, water use and discharges, power use and generation, use and storage of explosives, surface rights, housing and other facilities for workers, reclamation, taxation, labor standards, mine safety and occupational health.

We anticipate additional laws and regulations will be enacted over time with respect to environmental matters. The development of more stringent environmental protection programs in Peru could impose constraints and additional costs on our, Yanacocha’s and Cerro Verde’s operations and require us, Yanacocha and Cerro Verde to make significant capital expenditures in the future. Although we believe that we are substantially in compliance, and Yanacocha and Cerro Verde have advised us that they are substantially in compliance, with all applicable environmental regulations, ~~there can be no assurance~~we cannot assure you that future legislative or regulatory developments will not have an adverse effect on our, Yanacocha’s or Cerro Verde’s business or results of operations. See “Item 4. Information on the ~~Company—Buenaventura—~~Company – Buenaventura – B. Business ~~Overview—~~Overview – Regulatory ~~Framework—~~Framework – Environmental Matters” and “—Permits” and “Item 4. Information on the ~~Company—Yanacocha—~~Company – Yanacocha – B. Business ~~Overview—~~Overview – Regulation, Permit and Environmental Matters.”

Our and Yanacocha’s ability to successfully obtain key permits and approvals to explore for, develop and successfully operate mines will likely depend on our and Yanacocha’s ability to do so in a manner that is consistent with the creation of social and economic benefits in the surrounding communities. Our and Yanacocha’s ability to obtain permits and approvals and to successfully operate in particular communities or to obtain financing may be adversely impacted by real or perceived detrimental events associated with our orand Yanacocha’s activities or those of other mining companies affecting the environment, human health and safety or the surrounding communities. Delays in obtaining or failure to obtain government permits and approvals may adversely affect our and Yanacocha’s operations, including our and Yanacocha’s ability to explore or develop properties, commence production or continue operations.

Our metals exploration efforts are highly speculative in nature and may not be successful.

Precious metals exploration, particularly gold exploration, is highly speculative in nature, involves many risks and frequently is unsuccessful. ~~There can be no assurance~~We cannot assure you that our, Yanacocha’s or Cerro Verde’s metals exploration efforts will be successful. Once mineralization is discovered, it may take a number of years from the initial phases of drilling before production is possible, during which time the economic feasibility of production may change. Substantial expenditures are required to establish proven and probable ore reserves through drilling, to determine metallurgical processes to extract the metals from the ore and, in the case of new properties, to construct mining and processing facilities. As a result of these uncertainties, ~~no assurance can be given~~we cannot assure you that our or Yanacocha’s exploration programs will result in the expansion or replacement of current production with new proven and probable ore reserves.

We base our estimates of proven and probable ore reserves and estimates of future cash operating costs largely on the interpretation of geologic data obtained from drill holes and other sampling techniques, and feasibility studies. Advanced exploration projects have no operating history upon which to base estimates of proven and probable ore reserves and estimates of future cash operating costs. Such estimates are, to a large extent, based upon the interpretation of geologic data obtained from drill holes and other sampling techniques, and feasibility studies which derive estimates of cash operating costs based upon anticipated tonnage and grades of ore to be mined and processed, the configuration of the ore body, expected recovery rates of the mineral from the ore, comparable facility and equipment operating costs, anticipated climatic conditions and other factors. As a result, it is possible that actual cash operating costs and economic returns based upon proven and probable ore reserves may differ significantly from those originally estimated. Moreover, significant decreases in actual over expected prices may mean reserves, once found, will be uneconomical to produce. It is not unusual in new mining operations to experience unexpected problems during the start-up phase. See “Item 4. Information on the ~~Company—Buenaventura—~~Company – Buenaventura – D. Property, Plants and ~~Equipment—~~Equipment – Our ~~Properties—~~Properties – Reserves,” ~~“—Yanacocha—~~“– Yanacocha – D. Property, Plants and ~~Equipment—~~Equipment – Yanacocha’s ~~Properties—~~Properties – Reserves” and “Item 5. Operating and Financial Review and ~~Prospects—~~Prospects – Cerro ~~Verde—~~Verde – A. Operating Results” for the price per ounce used by us, Yanacocha and Cerro Verde, respectively, to calculate our respective proven and probable reserves.

Increased operating costs could affect our profitability.

Costs at any particular mining location frequently are subject to variation due to a number of factors, such as changing ore grade, changing metallurgy and revisions to mine plans in response to the physical shape and location of the ore body. In addition, costs are affected by the price of commodities, such as fuel and electricity, as well as by the price of labor. Commodity costs are at times subject to volatile price movements, including increases that could make production at certain operations less profitable. Reported costs may be affected by changes in accounting standards. A material increase in costs at any significant location could have a significant effect on our profitability.

Our business is capital-intensive and we may not be able to finance necessary capital expenditures required to execute our business plans.

Precious metals exploration requires substantial capital expenditures for the exploration, extraction, production and processing stages and for machinery, equipment and experienced personnel. Our estimates of the capital required for our projects may be preliminary or based on assumptions we have made about the mineral deposits, equipment, labor, permits and other factors required to complete our projects. If any of these estimates or assumptions change, the actual timing and amount of capital required may vary significantly from our current anticipated costs. In addition, we may require additional funds in the event of unforeseen delays, cost overruns, design changes or other unanticipated expenses. We may also incur debt in future periods or reduce our holdings of cash and cash equivalents in connection with funding future acquisitions, existing operations, capital expenditures or in pursuing other business opportunities. Our ability to meet our payment obligations will depend on our future financial performance, which will be affected by financial, business, economic and other factors, many of which we are unable to control. There can be no assurance that we or Yanacocha will generate sufficient cash flow and/or that we will have access to sufficient external sources of funds in the form of outside investment or loans to continue exploration activities at the same or higher levels than in the past or that we will be able to obtain additional financing, if necessary, on a timely basis and on commercially acceptable terms.

Estimates of proven and probable reserves are subject to uncertainties and the volume and grade of ore actually recovered may vary from our estimates.

The proven and probable ore reserve figures presented in this Annual Report are our, Yanacocha’s and Cerro Verde’s estimates, and there can be no assurance that the estimated levels of recovery of gold, silver, copper and certain other metals will be realized. Such estimates depend on geological interpretation and statistical inferences or assumptions drawn from drilling and sampling analysis, which may prove to be materially inaccurate. Actual mineralization or formations may be different from those predicted. As a result, reserve estimates may require revision based on further exploration, development activity or actual production experience, which could materially and adversely affect such estimates. No assurance can be given that our, Yanacocha’s or Cerro Verde’s mineral resources constitute or will be converted into reserves. Market price fluctuations of gold, silver and other metals, as well as increased production costs or reduced recovery rates, may render proven and probable ore reserves containing relatively lower grades of mineralization uneconomic to exploit and may ultimately result in a restatement of proven and probable ore reserves. Moreover, short-term operating factors relating to the reserves, such as the processing of different types of ore or ore grades, could adversely affect our or Yanacocha’s profitability in any particular accounting period. See “Item 4. Information on the ~~Company—Buenaventura—~~Company – Buenaventura – D. Property, Plants and ~~Equipment—~~Equipment – Our Properties—Reserves” and “Item 4. Information on the ~~Company—~~Company – D. Property, Plants and ~~Equipment—Yanacocha—~~Equipment – Yanacocha – Yanacocha’s ~~Properties—~~Properties – Reserves.”

We and Yanacocha may be unable to replace reserves as they become depleted by production.

As we and Yanacocha produce gold, silver, zinc and other metals, we and Yanacocha deplete our respective ore reserves for such metals. To maintain production levels, we and Yanacocha must replace depleted reserves by exploiting known ore bodies and locating new deposits. Exploration for gold, silver and the other metals produced is highly speculative in nature. Our and Yanacocha’s exploration projects involve significant risks and are often unsuccessful. Once a site is discovered with mineralization, we and Yanacocha may require several years between initial drilling and mineral production, and the economic feasibility of production may change during such period. Substantial expenditures are required to establish proven and probable reserves and to construct mining and processing facilities. Based on the current recovery rate and estimated gold production levels in 2012, Yanacocha’s proven and probable reserves as of December 31, 2012 will be depleted by 2015 unless Yanacocha continues to add to its reserves. As a result, thereThere can be no assurance that current or future exploration projects will be successful and there is a risk that our depletion of reserves will not be offset by new discoveries. See ~~“Item~~ “Item��4. Information on the ~~Company—Buenaventura—~~Company – Buenaventura – B. Business Overview—Exploration,” ~~“—Yanacocha—~~“– Yanacocha – B. Business ~~Overview—~~Overview – Exploration,” “—“– D. Property, Plants and ~~Equipment—~~Equipment – Reserves,” “—“– Yanacocha’s ~~Properties—~~Properties – Reserves” and “Item 5. Operating and Financial Review and ~~Prospects—~~Prospects – Cerro ~~Verde—~~Verde – A. Operating Results” for a summary of our, Yanacocha’s and Cerro Verde’s estimated proven and probable reserves as of December 31, ~~2012.~~2015.

Our operations are subject to risks, many of which are not insurable.

The business of mining, smelting and refining gold, silver, copper and other metals is generally subject to a number of risks and hazards, including industrial accidents, labor disputes, unavailability of materials and equipment, unusual or unexpected geological conditions, changes in the regulatory environment, environmental hazards and weather and other natural phenomena such as earthquakes, most of which are beyond our control. Such occurrences could result in damage to, or destruction of, mining properties or production facilities, personal injury or death, environmental damage, delays in mining, monetary losses and possible legal liability. We, Yanacocha, and Cerro Verde each maintain insurance against risks that are typical in the mining industry in Peru and in amounts that we, Yanacocha and ~~Yanacocha~~Cerro Verde believe to be adequate but which may not provide adequate coverage in certain circumstances. No assurance can be given that such insurance will continue to be available at economically feasible premiums or at all. Insurance against certain risks (including certain liabilities for environmental pollution or other hazards as a result of exploration and production) is not generally available to us or ~~Yanacocha or~~ to other companies within the industry.

Increases in equipment costs, energy costs and other production costs, disruptions in energy supply and shortages in equipment and skilled labor may adversely affect our results of operations.

In recent years, there has been a significant increase in mining activity worldwide in response to increased demand and significant increases in the prices of natural resources. The opening of new mines and the expansion of existing ~~mines~~ones has led to increased demand for, and increased costs and shortages of, equipment, supplies and experienced personnel. These cost increases have significantly increased overall operating and capital budgets of companies like ours, and continuing shortages could affect the timing and feasibility of expansion projects.

Energy represents a significant portion of our production costs. Our principal energy sources are electricity, purchased petroleum products, natural gas and coal. An inability to procure sufficient energy at reasonable prices or disruptions in energy supply could adversely affect our profits, cash flow and growth opportunities. Our production costs are also affected by the prices of commodities we consume or use in our operations, such as sulfuric acid, grinding media, steel, reagents, liners, explosives and diluents. The prices of such commodities are influenced by supply and demand trends affecting the mining industry in general and other factors outside our control and such prices are at times subject to volatile movements. Increases in the cost of these commodities or disruptions in energy supply could make our operations less profitable, even in an environment of relatively high copper, gold or silver prices. Increases in the costs of commodities that we consume or use may also significantly affect the capital costs of new projects.

We may be adversely affected by labor disputes.

Our ability to achieve our goals and objectives is dependent, in part, on maintaining good relations with our employees. A prolonged labor disruption at any of our material properties could have a material adverse impact on our results of operations. We, Compañía Minera Coimolache S.A., or “Coimolache,” Yanacocha and Cerro Verde have all experienced strikes or other labor-related work stoppages in the past. ~~Most recently, we~~In June 2015, El Brocal experienced a ~~15-day~~two-day work stoppage at ~~our Orcopampa mine due to strikes~~its concentrator plant in Huaraucaca in connection with the negotiation of salary and the collective bargaining agreement. Subsequently, in May and June 2015, we experienced a strike at the Uchucchacua mine that lasted for twenty-nine days and ~~a further 9-day work stoppage at Orcopampa due to strikes in October 2012.~~ was staged by workers’ and contractors’ unions claiming unsuitable working conditions.

As of December 31, ~~2012,~~2015, unions represented approximately ~~54 percent~~39% of the employees of our ~~permanent employees.~~mining companies on a consolidated basis. Although we consider our ~~relations~~relationship with our employees to be positive, there can be no assurance that we will not experience strikes or other labor-related work stoppages that could have a material adverse effect on our operations and/or operating results in the future.

Our, Yanacocha and ~~Yanacocha’s~~Cerro Verde’s operations are subject to political and social risks.

Our, Yanacocha and ~~Yanacocha’s~~Cerro Verde´s exploration and production activities are potentially subject to political and social risks. Over the past several years, we and Yanacocha have been the target of local political protests. In recent years, certain areas in the south and northern highlands of Peru with significant mining developments have experienced strikes and protests related to the environmental impact of mining activities. Such strikes and protests have resulted in commercial disruptions and a climate of uncertainty with respect to future mining projects. As a result of local political and community protests, construction and development activities at the Conga project were largely suspended in November 2011. The results of the Peruvian Central Government’s Environmental Impact Assessment (“EIA”) independent review were reported on April 20, 2012. The review indicated the project’s EIA met Peruvian and international standards. The review made recommendations to provide additional water capacity and social funds, which Yanacocha has largely accepted. Yanacocha announced the decision to advance the project on a “water-first” basis on June 22, 2012. In the first half of 2014, a Conga Restart Study was completed to identify and test alternatives to advancing development of the project. Following this assessment, a new plan was developed to reduce spending to focus only on the most critical work (protecting people and assets, engaging with communities, and maintaining existing project infrastructure), while maintaining optionality. Newmont will not proceed with the full development of the Conga project without social acceptance, solid project economics and, potentially, another partner to help defray costs and risk. It is difficult to predict when or whether such events may occur. Under the current social and political environment, we do not anticipate being able to develop the Conga project in the foreseeable future. The continued delay and evaluation of other alternatives may result in a potential accounting impairment or further reclassification of mineralized material.

There can be no assurance that these types incidents will not continue or that similar incidents will not occur in areas in which we and Yanacocha operate, or that the continuation or intensification of community protests will not adversely affect our or Yanacocha’s exploration and production activities or our or Yanacocha’s results of operations or financial condition.

In addition, during 2011, Peru enacted Law No. 29785, the Law of Prior Consultation for Indigenous and Native ~~Communities(~~Communities (Ley del Derecho a la Consulta Previa a los Pueblos Indígenas y Originarios, Reconocido en el Convenio 169 de la Organización Internacional del Trabajo). Implementing regulations thereunder were approved by Supreme Decree No. 001-2012-MC, which became effective on April 2, 2012. This law establishes a prior consultation procedure that the Peruvian government must undertake in concert with any local indigenous communities whose collective rights may be directly affected by new legislative or administrative measures, including the granting of new mining concessions. The implementing regulations specify the form and circumstances of the required consultation and the manner in which agreements will be formalized, and cap the consultation process at 120 calendar days. Under the law, the Peruvian governmental body responsible for issuing or approving the administrative measure or decree in question, rather than the affected local indigenous community, retains the right to approve or reject the relevant legislative or administrative matter following such consultation. However, to the extent that any future projects operated by us, Yanacocha or Cerro Verde require legislative or administrative measures that impact local indigenous communities, the required prior consultation procedure may result in delays, additional expenses or failure to obtain approval for such new project.

We could face geotechnical challenges, which could adversely impact our production and profitability.

No assurances can be given that unanticipated adverse geotechnical and hydrological conditions, such as landslides and pit wall failures, will not occur in the future or that such events will be detected in advance. Geotechnical instabilities can be difficult to predict and are often affected by risks and hazards outside of our control, such as severe weather and considerable rainfall, which may lead to periodic floods, mudslides, wall instability and seismic activity, which may result in slippage of material.

Geotechnical failures could result in limited or restricted access to mine sites, suspension of operations, government investigations, increased monitoring costs, remediation costs, loss of ore and other impacts, which could cause one or more of our projects to be less profitable than currently anticipated and could result in a material adverse effect on our results of operations and financial position.

We rely on contractors to conduct a significant portion of our operations and mine development projects.

A significant portion of our operations and mine development projects are currently conducted by contractors. As a result, our operations are subject to a number of risks, some of which are outside our control, including:

failure of a contractor to perform under its agreement;

interruption of operations or increased costs ~~in the event that~~if a contractor ceases its business due to insolvency or other unforeseen events;

failure of a contractor to comply with applicable legal and regulatory requirements, to the extent it is responsible for such compliance; and

problems of a contractor with managing its workforce, labor unrest or other employment issues.

In addition, we may incur liability to third parties as a result of the actions of our contractors. The occurrence of one or more of these risks could adversely affect our results of operations and financial position.

We are not, and do not intend to become, regulated as an investment company under the U.S. Investment Company Act of 1940, as amended ~~or the Investment~~(the “Investment Company ~~Act,~~Act”), and if we were deemed an “investment company” under the Investment Company Act, applicable restrictions could make it impractical for us to operate as contemplated.

As of December 31, ~~2012,~~2015, we owned a ~~43.65 percent~~43.65% partnership interest in Yanacocha and a ~~19.58 percent~~19.584% equity interest in Cerro Verde. These interests may constitute “investment securities” for purposes of the Investment Company Act.

Under the Investment Company Act, an investment company is defined in relevant part to include (i) any company that is or holds itself out as being engaged primarily, or proposes to engage primarily, in the business of investing, reinvesting or trading in securities and (ii) any company that owns or proposes to acquire investment securities having a value exceeding ~~40 percent~~40% of such company’s total assets (exclusive of certain items) on an unconsolidated basis. Issuers that are investment companies within the meaning of the Investment Company Act, and which do not qualify for an exemption from the provisions of such act, are required to register with the ~~SEC~~Securities and Exchange Commission (the “SEC”) and are subject to substantial regulations with respect to capital structure, operations, transactions with affiliates and other matters. If we were deemed to be an investment company and did not qualify for an exemption from the provisions of the Investment Company Act, we would be required to register with the SEC and would be subject to such regulations, which would be unduly burdensome and costly for us and possibly adversely impact us.

We received an order from the SEC on April 19, 1996 declaring us to be primarily engaged in a business other than that of an investment company and, therefore, not an investment company within the meaning of the Investment Company Act. We intend to conduct our operations and maintain our investments in a manner, and will take appropriate actions as necessary, to ensure we will not be deemed to be an investment company in the future. The SEC, however, upon its motion or upon application, may find that the circumstances that gave rise to the issuance of the order no longer exist, and as a result may revoke such order. There can be no assurance that such order will not be revoked.

Our or Yanacocha’s inability to maintain positive relationships with the communities in which we operate may affect our or Yanacocha’s reputation and financial condition.

Our and Yanacocha’s relationships with the communities in which we operate are critical to ensuring the future success of our existing operations and the construction and development of our projects. Adverse publicity generated by non-governmental organizations or local communities related to extractive industries generally, or our or Yanacocha’s operations specifically, could have an adverse effect on our reputations or financial condition and may impact our relationships with the communities in which we operate. In addition, following the enactment of Law No. 29785, the Law of Prior Consultation for Indigenous and Native Communities in 2011, the Peruvian government must undertake a prior consultation procedure in concert with local indigenous communities whose collective rights may be directly affected by new legislative or administrative measures, including the granting of new mining concessions. Implementing regulations under Law No. 29785 were approved by Supreme Decree No. 001-2012-MC, which became effective on April 2, 2012. The implementing regulations specify the form and circumstances of the required consultation and the manner in which agreements will be formalized, and cap the consultation process at 120 calendar days. Our and Yanacocha’s national reputation for maintaining positive relationships with the communities in which we operate may affect the outcome of any such prior consultation process involving approvals that we or Yanacocha seek for new projects. While we and Yanacocha are committed to operating in a socially responsible manner, there is no guarantee that our efforts in this regard will mitigate this potential risk. We and Yanacocha have implemented extensive community relations and security and safety initiatives to anticipate and manage social issues that may arise at our operations. See “Item 4. Information on the ~~Company—Yanacocha—~~Company – Yanacocha – B. Business ~~Overview—~~Overview – Social Development.”

In November 2011, construction activities at the Conga project were suspended at the request of Peru’s central government following increasing protests in Cajamarca by anti-mining activists led by the regional president. At the request of the Peruvian central government, the environmental impact assessment, or EIA, prepared in connection with the project, which was previously approved by the central government in October 2010, was reviewed by independent experts in an effort to resolve allegations surrounding the environmental viability of the Conga project. Construction was suspended for the duration of the review, except for sediment control work conducted in the project area. The report was released in April 2012. As of the date of this Annual Report, Yanacocha is evaluating the report’s findings. Progress continues on engineering and procurement work.

The Conga project is located within close proximity of existing operations at Yanacocha. Due to local political and community protests, construction and development activities at the Conga project were largely suspended in November 2011. The results of the Peruvian central government-initiated ~~EIA~~Environmental Impact Study (“EIS”), independent review, announced on April 20, 2012, confirmed that Yanacocha’s initial ~~EIA~~EIS met Peruvian and international standards. The review made recommendations to provide additional water capacity and social funds, which Yanacocha has largely accepted. Yanacocha announced its decision to move the project forward on a “water first” basis on June 22, 2012, which consists of building the originally planned community water reservoirs ~~prior to~~before resuming any mine development. As a result, during 2013 the project ~~will be~~was focused on building water reservoirs, completing the remaining engineering activities, and accepting delivery of the main equipment purchases. In 2013, the Chailhuagon reservoir was completed. There were no major improvements carried out in 2014 or 2015. There can be no assurance that Yanacocha will be able to continue to develop the Conga project. Should Yanacocha be unable to continue with the current development plan at Conga, we or our mining partners in this project may reprioritize and reallocate capital to development alternatives, which may result in a potential accounting impairment. See “Item 4. Information on the ~~Company—Yanacocha—~~Company – Yanacocha – B. Business ~~Overview—~~Overview – Exploration.”

Deterioration in our financial position or a downgrade of our ratings by a credit rating agency could increase our borrowing costs and our business relationships could be adversely affected.

Credit rating agencies could downgrade our ratings either due to factors specific to Buenaventura, a prolonged cyclical downturn in the precious metals mining industries, macroeconomic trends (such as global or regional recessions) or trends in credit and capital markets more generally. For instance, on March 22, 2016, Moody’s downgraded our unsecured corporate rating from “Ba1” to “Ba2” due to the deterioration of the commodities markets and a downturn in the precious metals mining sector, as well as concerns about our liquidity. Our unsecured rating from Fitch remains a “BBB.”

A deterioration of our financial position or a further downgrade of any of our credit ratings for any reason could increase our borrowing costs and have an adverse effect on our business relationships with customers and suppliers. A subsequent downgrade could adversely affect our existing financings, limit access to the capital or credit markets, or otherwise adversely affect the availability of other new financing on favorable terms, if at all, result in more restrictive covenants in agreements governing the terms of any future indebtedness that we incur, increase our borrowing costs, or otherwise impair our business, financial condition and operating results.

Factors Relating to Peru

Peruvian political conditions may have an adverse impact on our, Yanacocha’s and Cerro Verde’s business.

All of our, Yanacocha’s and Cerro Verde’s operations are conducted in Peru. Accordingly, our, Yanacocha’s and Cerro Verde’s business, financial condition or results of operations could be affected by changes in economic or other policies of the Peruvian government or other political, regulatory or economic developments in Peru.

During the past several decades, Peru has had a history of political instability that has included military coups and a succession of regimes with differing policies and programs. Past governments have frequently played an interventionist role in the nation’s economy and social structure. Among other things, past governments have imposed controls on prices, exchange rates and local and foreign investment as well as limitations on imports, restricted the ability of companies to dismiss employees, expropriated private sector assets (including mining companies) and prohibited the remittance of profits to foreign investors.

In the second quarter of 2011, Presidential and Congressional elections resulted in a change in government in Peru. During the third quarter of 2011, the new government enacted four new tax laws. During 2012, the new administration, under President Ollanta Humala, largely supported mining as a driver for the continued growth and future development of Peru. However, Peru will be holding its elections for President during 2016 and we ~~are unable to~~cannot predict ~~whether the central~~future government positions on mining concessions, land tenure, environmental regulation or taxation or assure you that future governments will ~~continue to take similar positions in the future.~~maintain a generally favorable business climate and economic policies. Furthermore, the regional ~~government~~governor in Cajamarca, who was re-elected in October 2014, actively opposed the Conga project in 2012 and continues to reject the viability of its development. We cannot predict the future positions of either the central government or regional governments on foreign investment, mining concessions, land tenure or other regulation. Any change in government positions or laws on these issues could adversely affect the assets and operations of us, Yanacocha or Conga, which could have a material adverse effect on our business, results of operations and financial position. Regulatory changes may include increased labor regulations, environmental and other regulatory requirements, and additional taxes and royalties, and we may experience future protests, community demands and road blockages. Additionally, any inability to continue to develop the Conga project or operate at Yanacocha could have a material adverse impact on our business, results of operations and financial position if Yanacocha is not able to replace its expected production.

Inflation, reduced economic growth and fluctuations in the ~~Nuevo~~ Sol exchange rate may adversely affect our financial condition and results of operations.

Over the past several decades, Peru has experienced periods of high inflation, slow or negative economic growth and substantial currency devaluation. The inflation rate in Peru, as measured by theIndice de Precios al Consumidor~~, or IPC,~~ and published byInstituto Nacional de Estadística e Informática or~~INEI,~~ has fallen from a high of ~~7,649.7 percent~~7,649.7% in 1990 to ~~2.6 percent~~4.40% in ~~2012.~~2015. The Peruvian currency has been devalued numerous times during the last 20 years. ~~The devaluation rate has decreased from a high of 4,019.3 percent in 1990 to a revaluation of 5.5 percent in 2012.~~ Our revenues and operating expenses are primarily denominated in U.S. Dollars. If inflation in Peru were to increase without a corresponding devaluation of the ~~Nuevo~~ Sol relative to the U.S. Dollar, our financial position and results of operations, and the market price of our Common Shares and ADSs, could be affected. Although the Peruvian government’s stabilization plan has significantly reduced inflation, and the Peruvian economy has experienced strong growth in recent years, there can be no assurance that inflation will not increase from its current level or that such growth will continue in the future at similar rates or at all.

Among the economic circumstances that could lead to a devaluation would be the decline of Peruvian foreign reserves to inadequate levels. Peru’s foreign reserves at December 31, ~~2012~~2015 were US$~~64.0~~61.54 billion as compared to US$~~48.8~~62.35 billion at December 31, ~~2011. Although~~2014.Although actual foreign reserves must be maintained at levels that will allow the succeeding government the ability to manage the Peruvian economy and to assure monetary stability in the near future, there can be no assurance that Peru will be able to maintain adequate foreign reserves to meet its foreign currency denominated obligations, or that Peru will not devalue its currency should its foreign reserves decline. See “Item 3. Key ~~Information—~~Information – A. Selected Financial ~~Data—~~Data – Exchange Rates.”

Peru’s current account deficit is being funded partially by foreign direct investment. There can be no assurance that foreign direct investment will continue at current levels, particularly if adverse political or economic developments in Peru arise, a development that may also contribute to devaluation pressure.

Deterioration in economic and market conditions in Latin America, Peru and other emerging market countries could affect the prices of our Common Shares and American Depositary ~~Receipts.~~

The market for securities issued by Peruvian companies is influenced by economic and market conditions in Peru and, to varying degrees, market conditions in other Latin American and emerging market countries. Within Peru, news of Ollanta Humala’s June 5, 2011 victory in the presidential election was followed by a 12 percent decline in both the Lima stock exchange (~~Bolsa de Valores de Lima~~~~, or BVL) and BVL’s mining sub-index the following day. The price of our American Depositary~~ Receipts or ADRs, fell 15 percent. A number of banking analysts lowered their recommendations on Peruvian mining companies following the election as a result of concerns of higher taxes and delays in mining projects.(“ADRs”).

Although economic conditions are different in each country, the reaction of investors to developments in one country is likely to cause the capital markets in other countries to fluctuate. For example, political and economic events, such as the crises in Venezuela, Ecuador, Bolivia, Brazil and Argentina, have influenced investors’ perceptions of risk with regard to Peru. The negative investor reaction to developments in Latin America, particularly in our neighboring countries, may adversely affect the market for securities issued by countries in the region, cause foreign investors to decrease the flow of capital into Latin America and introduce uncertainty about plans for further integration of regional economies.

Peruvian exchange and investment control policies could affect dividends paid to holders of Common Shares and ADRs.

Peruvian law currently imposes no restrictions on the ability of companies operating in Peru to transfer foreign currency from Peru to other countries, to convert Peruvian currency into foreign currency or foreign currency into Peruvian currency or to remit dividends abroad, or on the ability of foreign investors to liquidate their investment and repatriate their capital. ~~Prior to~~Before 1991, Peru had restrictive exchange controls and exchange rates. During the latter part of the 1980s, exchange restrictions prevented payment of dividends to our shareholders in the United States in U.S. Dollars. Accordingly, should such or similar controls be instituted, dividends paid to holders of Common Shares and, consequently, holders of ADRs, could be affected. There can be no assurance that the Peruvian government will continue to permit such transfers, remittances or conversion without restriction. See “Item 10. Additional ~~Information—~~Information – D. Exchange Controls.”

U.S. securities laws do not require us to disclose as much information to investors as a U.S. issuer is required to disclose, and you may receive less information about us than you might otherwise receive from a comparable U.S. company.

The corporate disclosure requirements applicable to us may not be equivalent to the requirements applicable to a U.S. company and, as a result, you may receive less information about us than you might otherwise receive in connection with a comparable U.S. company. We are subject to the periodic reporting requirements of the United States Securities Exchange Act of 1934, as amended, or the Exchange Act, that apply to “foreign private issuers.” The periodic disclosure required of foreign private issuers under the Exchange Act is more limited than the periodic disclosure required of U.S. issuers.

Holders of our securities may find it difficult to enforce judgments against us outside of Peru.

We are organized under the laws of Peru. A significant majority of our directors and officers reside outside the United States (principally in Peru). All or a substantial portion of our assets or the assets of such persons are located outside the United States. As a result, it may not be possible for investors to effect service of process within the United States upon us or upon such persons or to enforce against them in federal or state courts in the United States judgments predicated upon the civil liability provisions of the federal securities laws of the United States. We have been advised by our Peruvian counsel that there is uncertainty as to the enforceability, in original actions in Peruvian courts, of liabilities predicated solely under the United States federal securities laws and as to the enforceability in Peruvian courts of judgments of United States courts obtained in actions predicated upon the civil liability provisions of the United States federal securities laws.

Factors Relating to the Common Shares and ADSs

The concentration of our capital stock ownership with the Benavides Family will limit our stockholders’ ability to influence corporate matters.

~~The aggregate percentage~~As of March 31, 2016, the Benavides family, referring to certain members, and their spouses, of the ~~economic interest~~immediate and extended family of ~~our outstanding share capital controlled by~~Elsa Ganoza Benavides, spouse of the late Alberto Benavides de la Quintana, our founder and former Chairman ~~and Chief Executive Officer, and~~(collectively, the “Benavides Family”), held ~~by certain members of his immediate and extended family and their spouses, or the Benavides Family, as of March 31, 2013 was 27.22 percent~~27.22% (including outstanding Common Shares and Investment Shares). of Buenaventura’s outstanding share capital. Because of the significant ownership interest the Benavides Family holds in ~~common shares and because the Investment~~Common Shares, ~~held by others do not have voting rights,~~ the Benavides Family has the power to elect a significant number of the outstanding directors and has significant influence over the outcome of substantially all matters to be decided by a vote of shareholders.

In addition, under the terms of the Amended and Restated Deposit Agreement dated May 3, 2002, as further amended and restated as of November 12, 2003, among us, The Bank of New York Mellon (formerly The Bank of New York), as depositary, or the ~~Depositary,~~“Depositary”, and the owners and beneficial owners of ADSs, or the Amended and Restated Deposit Agreement, relating to our ADSs, if holders of ADSs do not provide the Depositary with timely instructions for the voting of Common Shares represented by such ADRs, the Depositary will be deemed to be instructed to give a person designated by us, which will likely be ~~Alberto~~a member of the Benavides ~~de la Quintana,~~Family, a discretionary proxy to vote such shares, unless we inform the Depositary that we do not wish such proxy to be given.

Shareholders’ rights under Peruvian law may be fewer and less well-defined than shareholders’ rights in other countries, including the United States.

Our shareholders have fewer and less well-defined rights under applicable Peruvian law than they might have as shareholders of a corporation incorporated in a jurisdiction of the United States or certain other countries. For example, Peruvian law does not provide for proceedings by which non-controlling shareholders may file class action lawsuits or shareholder derivative actions against controlling shareholders or officers and directors, and the procedural requirements to file shareholder actions in Peru differ from those of the United States. As a result, holders of our shares may face difficulty enforcing their rights.

A sale of a substantial number of shares by the Benavides Family could have an adverse impact on the price of our Common Shares and ADSs.

~~Sales~~The sale of a substantial number of our shares by members of the Benavides Family, or a market perception of the intention of members of the Benavides Family to sell a substantial number of shares, could materially and adversely affect prevailing market prices for the Common Shares and ADSs. There is no contractual restriction on the disposition of shares of our share capital by our shareholders, including the Benavides Family. Furthermore, under theLey General de Sociedades ~~Peruana~~Peruanas, or ~~Peruvian~~“Peruvian Companies Law,” any restriction on the free sale of shares in asociedad anónima abierta~~(open~~ (open stock company) such as we are, is null and void.

Holders of ADSs may be unable to exercise preemptive rights and accretion rights available to the Common Shares underlying the ADSs.

Holders of the ADSs are, under Peruvian law, entitled to exercise preemptive rights and accretion rights on the Common Shares underlying the ADSs in the event of any future capital increase by us unless (x) the increase is approved, expressly stating that the shareholders have no preemptive rights to subscribe and pay for the Shares to be issued in such increase, by holders of Common Shares holding at least ~~40 percent~~40% of the Common Shares at a properly called meeting with a proper quorum and (y) the increase is not designed to improve directly or indirectly the shareholding of any shareholder. However, United States holders of ADSs may not be able to exercise through the Depositary for the ADSs the preemptive rights and accretion rights for Common Shares underlying their ADSs unless a registration statement under the Securities Act of 1933, as amended, or the ~~Securities~~“Securities Act,” is effective with respect to such rights or an exemption from the registration requirement thereunder is available. Any such rights offering would have a dilutive effect upon shareholders who are unable or unwilling to exercise their rights. We intend to evaluate, at the time of any rights offering, the costs and potential liabilities associated with any registration statement as well as the associated benefits of enabling the holders of ADSs to exercise such rights and will then make a decision as to whether to file such a registration statement. Therefore, no assurance can be given that we will file any such registration statement. To the extent that holders of ADSs are unable to exercise such rights because a registration statement has not been filed and no exemption from such registration statement under the Securities Act is available, the Depositary will, to the extent practicable, sell such holders’ preemptive rights or accretion rights and distribute the net proceeds thereof, if any, to the holders of ADSs, and such holders’ equity interest in us will be diluted proportionately. The Depositary has discretion to make rights available to holders of ADSs or to dispose of such rights and to make any net proceeds available to such holders. If, by the terms of any rights offering or for any other reason, the Depositary is not able to make such rights or such net proceeds available to any holder of ADSs, the Depositary may allow the rights to lapse.

~~ITEM 4. Information on the Company~~

ITEM 4.

Information on the Company

In this Item 4, we present information first with respect to Buenaventura, followed by information with respect to Yanacocha, in which we have a ~~43.65 percent~~43.65% partnership interest.

BUENAVENTURA

A.
A. History and Development

Overview

We are Peru’s largest publicly traded precious metals company and are engaged in the exploration, mining and processing of gold, silver and, to a lesser extent, other metals in Peru. We currently operate the ~~Julcani, Recuperada,~~ Orcopampa, ~~Poracota,~~ Uchucchacua, ~~Antapite, Ishihuinca, Shila-Paula,~~Julcani, Mallay and Breapampa mines and have controlling interests in three other mining companies which operate the ~~Colquijirca, Marcapunta,~~Colquijirca-Marcapunta, Tantahuatay and La Zanja ~~mines.We~~mines. We also own an electric power transmission company, a hydroelectric plant, a processing plant and an engineering services consulting company and ~~have~~ non-controlling interests in several other mining companies, including a significant ownership interest in Yanacocha, a Peruvian partnership that operates ~~South America’s~~the largest gold mine in South America, and Cerro Verde, a Peruvian company that operates a copper mine located in the south of Peru. For the year ended December 31, ~~2012,~~2015, our consolidated net sales were US~~$1,496~~US$919.4 million and our consolidated net ~~income~~loss was US$~~684.7million.~~375.5 million.

Discontinued operations. In 2014, the Company publicly announced its decision to sell four of its mining units: Poracota, Recuperada, Antapite and Shila-Paula. As a consequence, these mining units are presented in the Financial Statements as mining units held for sale. According to IFRS 5 “Non-current Assets Held for Sale and Discontinued Operations,” the related assets and liabilities are presented in the consolidated statement of financial position at the lower of cost and fair value less cost to sale. The ~~tables~~disposition of these discontinued mining units is expected to be completed by December 31, 2016 through sales to third parties. See Notes 1(e) and 2.4(x) to the Financial Statements.

The table below ~~summarize~~summarizes the total production and our equity share of production for the Julcani, ~~Recuperada,~~ Orcopampa, ~~Poracota,~~ Uchucchacua, ~~Antapite, Ishihuinca, Shila-Paula,~~ Mallay, Breapampa, ~~Colquijirca-Marcapunta,~~Colquijirca, La Zanja, Tantahuatay, Yanacocha and Cerro Verde mines, as well as certain small assets for divestment, for the year ended December 31, ~~2012:~~2015:

	TOTAL PRODUCTION													BUENAVENTURA’S EQUITY SHARE OF PRODUCTION										Total Production													Buenaventura’s Equity Share of Production
UNIT	Buenaventura’s Equity Ownership			Silver Oz		Gold Oz		Lead DST		Zinc DST		Copper DST		Silver Oz		Gold Oz		Lead DST		Zinc DST		Copper DST		Buenaventura’s Equity Ownership			Silver (oz.)		Gold (oz.)		Lead (t)		Zinc (t)		Copper (t)		Silver (oz.)		Gold (oz.)		Lead (t)		Zinc (t)		Copper (t)

Orcopampa		100	%		425,620		260,379		-		-		-		425,620		260,379		-		-		-		100	%		562,795		204,629		-		-		-		562,795		204,629		-		-		-
Poracota		100	%		16,181		19,238		-		-		-		16,181		19,238		-		-		-
Uchucchacua		100	%		11,263,322		-		9,636		10,824		-		11,263,322		-		9,636		10,824		-		100	%		13,919,922		-		8,433		5,692		-		13,919,922		-		8,433		5,692		-
Julcani		100	%		2,438,084		1,220		2,529		-		423		2,438,084		1,220		2,529		-		423		100	%		3,266,453		607		2,592		-		339		3,266,453		607		2,592		-		339
Recuperada		100	%		467,475		-		3,516		4,898		-		467,475		-		3,516		4,898		-
Antapite		100	%		13,254		11,720		-		-		-		13,254		11,720		-		-		-
Ishihuinca		100	%		-		4,016		-		-		22		-		4,016		-		-		22
Shila-Paula		100	%		95,485		19,359		-		-		-		95,485		19,359		-		-		-
Mallay		100	%		682,708		107		4,952		6,711		-		682,708		107		4,952		6,711		-		100	%		1,285,361		-		7,193		9,173		-		1,285,361		-		7,193		9,173
Breapampa		100	%		17,212		8,817		-		-		-		17,212		8,817		-		-		-		100	%		180,277		13,757		-		-		-		180,277		13,757		-		-		-
Colquijirca & Marcapunta		53.76	%		3,077,606		10,229		13,590		38,525		26,696		1,654,521		5,499		7,306		20,711		14,352
El Brocal																									54.07	%		3,669,500		11,263		18,854		53,319		32,061		1,984,098		6,090		10,194		28,830		17,335
La Zanja		53.06	%		387,877		112,387		-		-		-		205,808		59,633		-		-		-		53.06	%		331,080		141,071		-		-		-		175,671		74,852		-		-		-
Tantahuatay		40.06	%		919,343		141,268		-		-		-		367,737		56,507		-		-		-		40.10	%		879,832		144,782		-		-		-		352,769		58,050		-		-		-
Yanacocha		43.65	%		553,092		1,345,992		-		-		-		241,425		587,526		-		-		-		43.65	%		447,375		917,690		-		-		-		195,279		400,572		-		-		-
Cerro Verde		19.58	%		2,134,632		-		-		-		307,594		417,961		-		-		-		60,227		19.58	%		1,989,059		-		-		-		246,973		389,458		-		-		-		48,357

TOTAL PRODUCTION					22,491,891		1,934,732		34,223		60,958		334,735		18,306,793		1,034,021		27,939		43,144		75,024
Small assets for divestment																									100	%		13,005		17		63		56		-		13,005		17		63		56		-
Total Production																									-			26,544,658		1,433,816		37,135		68,240		279,373		22,325,087		758,575		28,476		43,750		66,032

Compañía de Minas Buenaventura S.A.A., asociedad anónima abierta (open stock company) under the laws of Peru,was originally established in 1953 as asociedad anónima ~~(company)~~(stock company) under the laws of Peru, and currently operates under the laws of Peru. Our registered office is located at ~~Carlos Villarán 790, Santa Catalina, La Victoria,~~Las Begonias 415 – Floor 19, Lima ~~13, Perú,~~27, Peru, telephone no. ~~5-11-419-2500.~~511-419-2500. Our ~~Internet~~ website ~~address is~~may be found at http://www.buenaventura.com. The information on our website is not a part of, and is not incorporated into, this document.

History

During the first several decades of our operations, we focused on the exploration and development of silver mines in Peru, including our Julcani, Orcopampa and Uchucchacua mines. Beginning in the early 1980s, we began to explore for gold and other metals in Peru to diversify our business and reduce our dependence on silver. We expanded our mineral reserves through property acquisition and intensive exploration programs designed to increase reserves and production of gold. We also conducted exploration leading to the discovery of gold mineralization and subsequent production of gold at our Orcopampa, ~~Shila, Ishihuinca~~La Zanja, and ~~Antapite~~Breapampa mines. In addition, we made significant equity investments in Yanacocha, which operates South America’s largest gold mine, ~~and~~ Cerro Verde, which operates an open-pit copper mine in ~~Peru.~~Peru, and Coimolache, which owns the Tantahuatay gold mine that we operate. As a result of these initiatives, the majority of our revenues are now derived from the production of gold.

In ~~2012, gold, copper, silver and other metals accounted for 59 percent, 19 percent, 18 percent and 4 percent, respectively,~~2014, we acquired 51% of ~~our equity share~~Canteras del Hallazgo S.A.C. (“CDH”), owner of ~~revenues~~the Chucapaca Project, from ~~our consolidated subsidiaries and our equity investees, Yanacocha, Cerro Verde and~~Minera Gold Fields Perú S.A. (“MGFPSA”). The Chucapaca Project involved a group of mining rights originally owned by MGFPSA. In 2008, Compañía ~~Minera Coimolache S.A.~~de Minas Buenaventura S.A.A. entered into a contract of Mineral lease, Option of Transfer, Option to Operate a Project and Option to Acquire a Stake, with MGFPSA regarding these mineral rights.

Pursuant to this contract, Buenaventura would be the project’s operator and would retain the option to acquire 100% of the mineral rights through a payment of US$2 million. Likewise, MGFPSA would also have the option to operate a project that, during explorations conducted by Buenaventura, is identified as a project whose main mineral content is gold (a “Gold Project”), ~~or Coimolache.~~in which case a new legal entity would be created to own the mineral rights to the project. Additionally, for this new legal entity, MGFPSA is awarded the right to purchase 51% of its shares as long as it fulfills its obligation to invest in explorations a sum equivalent to three times that which Buenaventura invested during the period it was the operator.

After Buenaventura discovered the ore deposit and it was identified as a gold project, CDH was created as owner to the project’s mineral rights; at which point MGFPSA, in charge of explorations in 2009, exercised its option to purchase 51% of CDH’s shares.

In August of 2014, Buenaventura purchased the totality of MGFPSA’s shares in CDH for a sale price of US$81 million and additional payments consisting of a Net Smelter Return Royalty of 1.5% in favor of MGFPSA for mining rights constituting the Chucapaca Project. Afterwards Buenaventura merged by absorption with CDH and registered the royalties in favor of MGFPSA in the title sheet of each one of the mining rights involved. Additionally, the Chucapaca Project has been renamed the San Gabriel Project. For more information about the San Gabriel Project, see “Item 4. B. Business Overview—Exploration Projects in Non-Operating Areas.”

Business Strategy

Our strategy is to sustain our position as Peru’s largest, publicly-traded gold and silver mining company by expanding our reserves and production. We are currently engaged in an active exploration and mine development program and participate in several mining exploration projects with Newmont Mining, ~~Minera Gold Fields Peru S.A., or Gold Fields, and~~ Southern Copper Corporation, ~~or SCC.~~Corporación Aceros Arequipa S.A. and Compañia de Minas Caudalosa S.A.C. In addition, we seek to increase the efficiency and capacity of our mining operations. We are aware of our social and environmental responsibilities and aim to excel in the prevention, mitigation and rehabilitation of mining-related disturbances.

Maintaining an Active Exploration Program

We view an active exploration program as our primary means to obtain new reserves. As of December 31, 2012, we hold and currently evaluate, either directly or in conjunction with exploration partners, 230,896 hectares of mining rights, excluding an additional 443,393hectares in mining properties which are consolidated in our production units, including our La Zanja, Compañía Minera Colquirrumi S.A., or Colquirrumi, and Compañía de Exploraciones, Desarrollo e Inversiones Mineras S.A.C., or Cedimin, subsidiaries and our equity investee, Coimolache.

During ~~2012,~~2015, we spent ~~approximately~~ US$~~95.5~~30.6 million on ~~“greenfield”~~“exploration in non-operating areas” and US$~~153.0~~91.5 million on ~~“brownfield” exploration-related investments primarily~~“exploration in ~~Peru and, to a lesser extent,~~units in ~~Chile and Mexico.~~operations.” Our ~~“greenfield”~~“exploration in non-operating areas” investments mainly focused on the following exploration projects: ~~Trapiche,~~ Tambomayo, ~~San Gregorio, Chancas, Hualgayoc,~~Alejandra, Marcapunta ~~Colquemayo, Surichata~~ and ~~El Faique.~~Pisacalla projects. Our ~~“brownfield”~~“exploration in units in operations” investments were mainly focused in the Orcopampa, ~~Poracota,~~ Uchucchacua ~~Antapite, Mallay, Recuperada~~ and Julcani ~~areas. We financed our 2012 exploration program with internal funds.~~mining units.

In ~~2013,~~2016, we intend ~~to invest approximately US$100 to US$120 million in brownfield exploration projects. In 2013, we expect~~ to invest approximately US$70 to US$80 million in exploration in units in operations and US$10 to US$20 million mainly in the following ~~greenfield exploration projects:~~explorations in non-operating areas: Tambomayo, ~~Trapiche, San Gregorio, Hualgayoc, Colquemayo~~Yumpag, Palla Palla and ~~El Faique,~~Daniela, among others.

Participation in Mining Exploration Agreements

In addition to managing and operating precious metals mines, we participate in mining exploration agreements with mining partners to reduce risks, gain exposure to new technologies and diversify revenues to include other base metals, such as copper and zinc. See ~~“—B.~~“B. Business ~~Overview—~~Overview – Exploration.” We believe that maintaining our focus on mining operations complements our partnership strategy because the engineering and geological expertise gained from such operations enhances our ability to participate in and contribute to those projects.

Capital Expenditures

Our capital expenditures induring the past three years have related principally to the acquisition of new mining properties, construction of new facilities and renewal of plant and equipment. Capital expenditures relating to exploration are not included in the table below and are discussed separately in ~~“—B.~~“B. Business ~~Overview—~~Overview – Exploration.” Set forth below is information concerning capital expenditures incurred by us in respect of each of our principal operating mines (not including capital expenditures for administrative purposes or other non-mining or non-energy subsidiaries) and by category of expenditure:

	Year Ended December 31,						Year Ended December 31,
	2010		2011		2012		2013		2014		2015
			(in thousands)				(US$ in thousands)
Julcani	US$	853	US$	1,967	US$	3,549		8,927		683		7,056
Uchucchacua		11,781		10,689		18,379		16,038		12,668		22,140
Orcopampa^(a)		17,490		26,859		19,047		11,023		8,963		3,340
Recuperada		1,284		1,100		2,224
Ishihuinca		17		3		139		31		-		-
Shila-Paula		1,429		2,415		3,012
Colquijirca and Marcapunta^(a)		70,974		64,013		86,384
Antapite		302		750		1,126
Colquijirca and Marcapunta								216,477		105,477		55,073
Conenhua		3,204		4,668		5,760		9,700		670		4,402
Mallay		7,735		36,058		18,687		16,643		963		3,627
Breapampa		-		20,314		37,004		16,233		2,394		3,398
La Zanja		48,998		34,043		75,742		84,858		29,113		57,950
Huanza		62,828		60,102		66,378		37,973		16,373		725
Río Seco		-		23,574		62,163		32,863		10,064		2,487
Molle Verde								24,166		15,641		4,049
Total	US$	226,895	US$	286,555	US$	399,594		474,931		203,009		164,247

	Year Ended December 31,^(a)						Year Ended December 31,
	2010		2011		2012		2013		2014		2015
			(in thousands)				(US$ in thousands)
Machinery and equipment	US$	12,658	US$	5,622	US$	3,462		15,742		11,741		3,469
Infrastructure		187,534		222,743		311,864		352,115		122,563		44,973
Mining		7,624		23,325		2,620		91,407		61,062		27,431
Milling		13,754		5,533		3,751		6,338		4,014		4,199
Transportation		1,108		664		316		1,749		368		287
Communications		309		71		562		704		85		77
Environmental		249		105		1,496		339		1,251		64,528
Other		3,659		28,492		75,523		6,538		1,925		19,283
Total	US$	226,895	US$	286,555	US$	399,594		474,932		203,009		164,247

~~(a)~~

For 2010, 2011 and 2012, includes US$57.4 million, US$43.8 million and US$103.6 million, respectively, for the expansion of El Brocal plant from 6,000 metric tons per day to 18,000 metric tons per day. For 2010, includes $2.0 million for the development of the Orcopampa tailing dam retreatment project. For 2011 and 2012, includes US$55.6 million and US$57.6 million, respectively, for the construction of the Huanza hydroelectrical plant, US$20.3 million and US$37.0 million, respectively, for the construction of the Breapampa mine and facilities, US$36.1 million and US$18.7 million, respectively, for the construction of the Mallay mine and facilities and US$27.6 million and US$56.7 million, respectively, for the construction of the Rio Seco processing plant.

We mainly financed our capital expenditures in ~~2010, 2011~~2014 and ~~2012~~2015 with internally-generated ~~funds~~funds. We partially funded the El Brocal Expansion and ~~a US$119 million financial lease agreement, which was used to finance~~the construction of the Huanza hydroelectric power ~~station.~~plant with leasing facilities, with aggregate amounts of US$344.4 million outstanding thereunder as of December 31, 2015 (including US$156.3 and US$188.1 million, respectively). See “Item 5. Operating and Financial Review and ~~Prospects—Buenaventura—~~Prospects – Buenaventura – B. Liquidity and Capital ~~Resources—~~Resources – Long-Term Debt.”

We have budgeted approximately US$250 to US$300 million for capital expenditures for ~~2013.~~2016. We continuously evaluate opportunities to expand our business within Peru, as well as in other countries as opportunities arise, and expect to continue to do so in the future. We may in the future decide to acquire part or all of the equity of, or undertake other transactions with, other companies involved in the same business as us or in other related businesses. However, there can be no assurance that we will decide to pursue any such new activity or transaction.

~~B. Business Overview~~

~~Production~~

Business Overview

We principally produce refined gold and silver, either as concentrates or doré bars, and other metals such as lead, zinc and copper as concentrates that we distribute and sell locally and internationally. The following table sets forth the production of the ~~Antapite,~~Orcopampa, Uchucchacua, Julcani, ~~Uchucchacua, Orcopampa, Poracota, Recuperada,~~ Mallay, Breapampa, ~~Ishihuinca, Colquijirca, Marcapunta,~~ La Zanja, and ~~Shila-Paula~~Colquijirca - Marcapunta mines by type of product for the last three years, calculated in each case on the basis of ~~100 percent~~100% of the applicable mine’s production. Production from Cerro Verde, Yanacocha and Tantahuatay are not included in these production figures.

Year Ended December 31,⁽¹⁾

2010 2011 2012
Gold (oz.)⁽²⁾ 481,768 524,101 447,472
Silver (oz.) 14,840,678 16,724,717 18,884,824
Zinc (ST)⁽³⁾ 49,151 36,900 60,958
Lead (ST) 27,145 24,029 34,223
Copper (ST) 19,012 26,652 27,141

	Year Ended December 31,⁽¹⁾⁽²⁾
	2013		2014		2015
Gold (oz.)		462,856		438,426		371,344
Silver (oz.)		19,193,075		20,119,162		23,228,392
Zinc (t)		46,178		26,706		68,240
Lead (t)		29,757		22,185		37,135
Copper (t)		27,845		43,557		32,400

(1)

The amounts in this table reflect the total production of all of our consolidated subsidiaries, including El Brocal and La Zanja, in which we owned a 53.76% and 53.06% controlling equity interest, respectively, as of December 31, 2012. The production data in this table reflect 100% of El Brocal’s and 100% of La Zanja’s production. For the years ended December 31, 2010, 2011 and 2012, El Brocal produced 2.5, 2.9 and 2.8 million ounces of silver, respectively, of which our equity share was 1.2, 1.6 and 1.4 million ounces of silver. For the years ended December 31, 2010, 2011 and 2012, La Zanja produced 43,727, 134,190 and 112,387 ounces of gold, respectively, of which our equity share was 23,201, 71,201 and 59,633 ounces of gold, and 38,155, 363,927 and 387,877 million ounces of silver, respectively, of which our equity share was 20,045, 193,100 and 205,808 million ounces of silver.Zanja.

(2)

~~Throughout this Annual Report, “oz.” refers to troy ounces of a fineness of 999.9 parts per 1,000, equal to 31.0135 grams.~~

~~(3)~~

~~Throughout this Annual Report, “ST” refers to short tons, each weighing 2,000~~~~avoirdupois~~ ~~pounds.~~Excludes production at four non-operating mines that are classified as discontinued operations.

Exploration

We view exploration as our primary means of generating ~~growth~~ value for our shareholders ~~and typically maintain~~maintaining a portfolio of active exploration projects at various stages of exploration for mineral resources in Peru. We currently hold, either directly or in conjunction with exploration partners, 230,896 hectares of mining rights as part of our exploration program. We hold an additional 443,393 hectares in mining properties which are consolidated in our production units. We invested approximatelyDuring 2015, we spent US$~~95.4~~30.6 million in ~~exploration forMineralized Material Not~~“exploration in ~~Reserve, or NRM,during 2012, including exploration related to~~non-operating areas” mainly focused in the ~~Trapiche,~~ Tambomayo, ~~San Gregorio, Chancas, Hualgayoc,~~Alejandra, Marcapunta ~~Colquemayo, Surichata~~ and ~~El Faique projects.~~

~~In 2013,~~Pisacalla projects, and US$91.5 million on “exploration in units in operations” mainly focused in the Orcopampa, Uchucchacua and Julcani mining units. During 2016, we expect to invest approximately US$~~170.0~~80 to US$~~200.0~~100 million in ~~greenfield~~these exploration ~~and brownfield exploration~~ activities. Exploration programs at our principal operating mines are not included in our exploration budget and are accounted for as part of the operating costs for each mine. Exploration expenditures in greenfield and brownfield projects include all of the costs associated with geologists, contractors, engineering, drilling equipment, metallurgical testing and environmental, social, engineering and economic feasibility studies.

Our exploration ~~team prepares~~department develops programs and budgets for individual projects each year and we allocate, subject to board approval, the proper amount to ~~finance~~fund each particular exploration ~~activity considered worthwhile. In light~~program. Because of the nature of mining exploration and ~~in order~~ to maintain flexibility to take advantage of opportunities, we allocate budgeted amounts by property or project only in the case of high ~~geological expectation as decided by management.We~~probability of success. We also allocate non-budgeted amounts over the course of the year to new projects ~~based on factual results,~~that our ~~needs and our geologists’ periodic evaluations and opinions regarding the progress of each opportunity and its potential for further exploration of minerals.~~technical team considers highly prospective.

~~An integral part of our exploration program is the participation in mining~~We have active joint venture exploration agreements with ~~affiliates of experienced~~other mining companies, including Newmont Peru S.R.L., ~~Compañía Minera Barrick Chile Limitada,~~ Southern Copper Corporation, ~~Gold Fields La Cima~~Corporación Aceros Arequipa S.A. and ~~Minera Gold Fields Peru S.A. The benefits of these joint exploration projects include greater investment in the~~Compañia de Minas Caudalosa S.A.C. In this way we have access to financing for exploration of our own mining ~~rights from the funds contributed by the partners, access to the assets of the partners~~properties as well as third-party properties without the costs and risks of outright acquisition, increased exposure to new exploration technologies and expansion of knowledge and sharing of experiences of management, geologists and engineers. In these mining exploration agreements, we may be the ~~designated~~ operator, an equity participant, the manager or a combination of these and other functions.

~~We generally do not conduct significant research and development activities other than our investments in geological research and exploration as described herein.~~

The following table lists our ~~current mine development~~principal exploration projects in non-operating areas, our effective participation in each project, our partners with respect to each project, the total ~~hectares in each project, observed mineralization~~number of ~~each project and exploration expenditures for each project during 2010, 2011 and 2012.~~

~~(1)~~

~~Prior to 2010, Breapampa was classified as a greenfield exploration project.~~

~~(2)~~

~~Prior to 2010, Mallay was classified as a brownfield exploration project. Includes 2010 Tinta, Condorsenja and Isguiz exploration costs.~~

~~The following table lists our current greenfield exploration projects, our effective participation in each project, our partners with respect to each project, the total~~ hectares in each project, observed mineralization of each project and the exploration expenditures for each project during ~~2010, 2011~~2014 and ~~2012.~~2015.

Exploration
Projects⁽¹⁾⁽²⁾

Buenaventura’s
Effective
Participation

Principal
Partners

Property
Hectares

Observed
Mineralization

Total Exploration
Expenditures During
2010

Total Exploration
Expenditures During
2011

Total Exploration
Expenditures During
2012

at March 31, 2013

Total
(Buenaventura
and Partners)

Buenaventura

Total
(Buenaventura
and Partners)

Buenaventura

Total
(Buenaventura
and Partners)

Buenaventura

(US$ in millions) (US$ in millions) (US$ in millions)

Joint Venture Projects:

Hualgayoc 50.00 % Gold Fields 15,417 Silver, zinc & lead 0.65 0.32 2.98 1.49 3.60 1.80
Lucanas 60.00 % Sumitomo 0 Copper & gold 0.19 0.12 - - — —
Exploration
Projects⁽¹⁾⁽²⁾

Buenaventura’s
Effective
Participation

Principal
Partners

Property
Hectares

Observed
Mineralization

Total Exploration
Expenditures During
2010

Total Exploration
Expenditures During
2011

Total Exploration
Expenditures During
2012

at March 31, 2013

Total
(Buenaventura
and Partners)

Buenaventura

Total
(Buenaventura
and Partners)

Buenaventura

Total
(Buenaventura
and Partners)

Buenaventura

(US$ in millions) (US$ in millions) (US$ in millions)

Buenaventura’s Projects:

Chaje 100.00 % None 18,400 Gold 1.05 1.05 0.21 0.21 0.02 0.02
Colquemayo 100.00 % None 28,800 Gold, silver & copper 2.46 2.46 4.29 4.29 4.33 4.33
El Faique 100.00 % None 13,209 Copper, zinc & gold 0.49 0.49 0.62 0.62 0.96 0.96
Pachuca Norte 100.00 % None 31,000 Silver & gold - - 4.02 4.02 0.00 0.00
Pisqahuanca⁽³⁾ 70.00 % None 0 Silver & gold 0.18 0.18 1.65 1.65 - -
Surichata 100.00 % None 700 Silver, zinc & lead - - 0.38 0.38 1.28 1,28
Terciopelo⁽⁴⁾ 100.00 % None 0 Gold & copper 1.36 1.36 0.14 0.14 - -
Trapiche 100.00 % None 37,291 Copper & molybdenum 1.39 1.39 3.10 3.10 15.91 15.91
Others⁽⁵⁾ 100.00 % None 172,577 Gold & polymetallic - - 3.55 3.55 6.65 4.85
301,977 28.95 17.75 88.46 53.45 29.15 27.35

Exploration Projects⁽¹⁾⁽²⁾	Buenaventura’s Effective Participation			Principal Partners	Property Hectares		Observed Mineralization	Total Exploration Expenditures During 2014				Total Exploration Expenditures During 2015
at March 31, 2016								Total (Buenaventura and Partners)		Buenaventura		Total (Buenaventura and Partners)		Buenaventura
								(US$ in millions)				(US$ in millions)
Buenaventura’s Projects:
Tambomayo		100	%			3,900	Gold, silver, lead and zinc		11.51		11.51		11.19		11.19
San Gabriel		100	%			4,600	Gold, Silver and Copper		0.00		0.00		1.33		1.33
Pisacalla		100	%			2,100	Gold		0.51		0.51		0.74		0.74
Trapiche		100	%			4,600	Copper and Molybdenum		1.14		1.14		0.64		0.64
Palla Palla		100	%			3,282	Gold and Silver		0.42		0.42		0.42		0.42
Livitaca		100	%			10,600	Gold and Cooper		0.64		0.64		0.35		0.35
San Gregorio		54.07	%			4,382	Zinc		0.00		0.00		0.03		0.02

(1)

~~This table does not include projects abandoned by us, consolidated mining units or those placed on hold prior to 2010.~~

~~(2)~~

In addition to these projects, we continue to conduct exploration at all of our operating mines and our subsidiaries.

~~(3)~~(2)

~~This project was terminated in 2011.~~Only includes explorations conducted by Buenaventura.

~~(4)~~22

~~This project was terminated in 2012.~~

~~(5)~~

~~Includes generative exploration in new areas.~~

The following table lists the mines in which we directed our ~~current brownfield exploration projects, our effective participation in each project, the total hectares in each project, observed~~principal explorations efforts, mineralization of each ~~project~~mine and the exploration expenditures for ~~each project during 2010, 2011~~2014 and ~~2012.~~2015.

Exploration
Projects

Buenaventura’s
Effective
Participation

Principal
Partners

Property
Hectares

Observed
Mineralization

Total Exploration
Expenditures During
2010

Total Exploration
Expenditures During
2011

Total Exploration
Expenditures During
2012

at March 31, 2013

Total
(Buenaventura
and Partners)

Buenaventura

Total
(Buenaventura
and Partners)

Buenaventura

Total
(Buenaventura
and Partners)

Buenaventura

(US$ in millions) (US$ in millions) (US$ in millions)

Buenaventura’s Projects:

Orcopampa 100.00 %¹ None 18,000 Gold & silver 2.91 2.91 2.41 2.41 6.90 5.85

Yumpag⁽¹⁾ 100.00 % None 1,847 Silver, lead & zinc 0.75 0.75 1.25 1.25 0.41 0.41
Anamaray⁽¹⁾ 100.00 % None 4,380 Zinc, lead & silver 0.64 0.64 1.70 1.70 2.19 2.19
Mallay 100.00 % None 2,300 Zinc, lead & silver 9.78 9.78 10.32 10.32 - -
Chanca⁽²⁾ 100.00 % None 3,880 Silver 1.40 1.40 3.69 3.69 10.98 10.98
Julcani-Recuperada⁽³⁾ 100.00 % None 3,213 Silver 0.72 0.72 0.14 0.14 0.84 0.84
Antapite 100.00 % None 22,075 Gold 0.14 0.14 - - - -
Poracota⁽⁴⁾ 100.00 % None 6,680 Gold & silver 0.78 0.78 0.94 0.94 2.06 2.06
Shila-Paula⁽⁶⁾ 100.00 % None 30,318 Gold & silver 1.90 1.90 6.57 6.57 16.97 16.97

96,865 19.01 19.01 27.02 27.02 40.35 39.25

Operating Units	Observed Mineralization	Total Exploration Expenditures During 2014				Total Exploration Expenditures During 2015
		Total		Buenaventura		Total		Buenaventura
		(US$in millions)				(US$in millions)
Buenaventura’s Units:
Orcopampa	Silver and Gold		51.82		51.82		41.71		41.71
Uchucchacua	Silver, lead and zinc		26.63		26.63		27.78		27.78
Julcani	Silver		10.98		10.98		12.70		12.70
Mallay	Zinc, lead and silver		7.81		7.81		7.54		7.54
Breapampa	Gold		0.49		0.49		1.82		1.82
La Zanja	Gold		0.12		0.12		0.04		0.04
Marcapunta	Copper & Gold		4.2		2.27		0.00		0.00

~~(1)~~

~~Includes part of brownfield exploration costs of Uchucchacua (Yumpag, San Francisco and Anamaray mines).~~

~~(2)~~

~~Includes exploration costs of Candelaria and Santa Rosa (part of our brownfield explorations of the Mallay mine).~~

~~(3)~~

~~Includes exploration costs of Escopeta, Carmela and Patara prospects (part of our brownfield explorations of the Recuperada mine).~~

~~(4)~~

~~Includes exploration costs of Huamanihuayta Oeste (part of our brownfield explorations of the Poracota mine).~~

~~(5)~~

~~Includes exploration costs of Pucay (through option agreement with SCC) and Pariguanas (through joint venture with Minera Ares), in addition to our own Saya, Aseruta, Ocoruro and Quello projects.~~

~~(6)~~

~~Includes exploration and development costs of Tambomayo (formerly known as the Tuyumina project) and Japotani (part of our brownfield explorations of the Shila-Paula mine).~~

The following is a brief summary of current ~~mine development and~~ exploration activities conducted by usBuenaventura directly and through joint exploration agreements, which we believe represent the best prospects for discovering new reserves. There can be no assurance, however, that any of our current exploration projects will result in viable mineral production or that any of the mineralization identified to date will ultimately result in an increase in our ore reserves. Non-reserve mineralization has been included in our 2012 Annual Report from the Tantahuatay, Chucapaca, Tambomayo, Parihuanas, Breapampa, Mallay and Yumpag exploration and mine development projects.SetSet forth below is a map of ~~all of~~ our ~~mine development and~~principal exploration projects in Peru as of December 31, ~~2012:~~2015.

~~Greenfield~~ Exploration Projects in Non-Operating Areas

~~Chucapaca.~~Tambomayo. The ~~Chucapaca~~Tambomayo project is located 50 kilometers southeast of the Orcopampa mine and includes a total of 1,600 hectares of mining properties. This project is a ~~gold-copper-silver greenfield exploration project wholly owned by Canteras del Hallazgo S.A.C., or CDH, which is 51 percent-owned by Minera Gold Fields Peru S.A.~~low sulfidation epithermal deposit with significant gold and ~~49 percent-owned by us. The project encompasses a total of 12,900 hectares of mining concessions owned by CDH, which are located~~silver mineralization in the Moquegua region in southern Peru. Our preliminary exploration activities at the Chucapaca project have included geophysical magnetic surveys, induced polarization surveys and diamond drilling, which resulted in the discovery of gold mineralization. During 2012, our equity investment in CDH was US$32.4 million, which was mainly for the preparation of a feasibility study. During 2013, CDH intends to conduct infill diamond drilling in the underground areas.veins. As of December 31, ~~2012, CDH~~2015, we had estimated resources of 1.08 million tons, with 9.4 grams per ton of gold, 9.3 ounces per ton of silver, 2.0% lead and 3.0% zinc. In addition, we had estimated a non-reserve mineralization (“NRM”) of 0.77 million tons, with 9.6 grams per ton of gold, 4.1 ounces per ton of silver, 1.8% lead and 3.3 percent zinc. The project is currently in its development phase, and the construction of the mine is well advanced with seven levels completed and with encouraging drill intercepts at lower levels. Construction permits were granted in June 2015 for a 1,500 tons-per-day plant. In 2016, we will focus our exploration efforts in the Mayra and Gaby prospects. We plan to invest US$1.39 million to conduct geological mapping and sampling. In addition, we expect to obtain environmental permits and surface rights for a drilling campaign at the Asuncion vein.

San Gabriel. San Gabriel is located in the region of Moquegua and is wholly-owned by Buenaventura. This deposit is an intermediate sulfidation deposit hosted by diatreme breccia body at the sediment-intrusive contact. As of December 31, 2015 we estimated a NRM ~~for the Chucapaca project to be 132.7~~of 12.25 million tons, with an average grade of ~~1.4~~6.5 grams per ton of ~~gold and 10.8 grams per ton of silver. Exploration expenses related~~gold. We began using a mine ramp in June 2015 in order to ~~this project are not consolidated in Buenaventura’s financial results, but are reflected in “Share~~explore opportunities for additional diamond drilling in the ~~results~~Canahuire ore body and to obtain bulk samples for metallurgical tests. In addition, we completed 3,418 meters of ~~associates”~~diamond drilling in ~~Buenaventura’s Consolidated Income Statement. See Note 9~~the Pachacutec prospect without positive results. In 2016, we plan to ~~the Financial Statements.~~invest US$2.69 million to conduct diamond drilling and to carry out geological mapping and sampling to define new exploration targets.

Trapiche. The Trapiche project ~~is wholly owned by us and encompasses 29,798~~consists of 30,591 hectares of mining concessions, ~~owned by us,~~ with porphyry copper and skarn mineralization in the Apurimac ~~region.~~region, Antabamba province and Juan Espinoza Medrano district. The Apurimac region is part of a mineralized belt known as the Abancay Batholith where several iron, copper and gold deposits have been identified. Our exploration activities at the Trapiche project have included diamond drilling and magnetic and induced polarization surveys. In 2011, we negotiated and obtained a 30-year lease with the Mollebamba community for 2,300 hectares of surface rights to conduct infill and additional diamond drilling and other engineering studies. We invested US$3.1 million in payments to the local community, to start preliminary engineering studies and to restart drilling at the end of 2011. We created a new company to operate the Trapiche project, El Molle Verde S.A.C, which is wholly owned by us, and we leased all mining properties to the new company. In 2012, we invested US$16.1 million to conduct 26,000 meters of diamond drilling, both into the copper oxide zone and as an infill program into the porphyry area, and to conduct 3,714 meters of diamond drilling for metallurgical testing. Independent consultant AMEC plc also conducted a preliminary engineering study of this area. We currently do not plan to make further investments in the Trapiche project in 2013. As of December 31, ~~2012,~~2015, we estimated a NRM of 925 million tons for the Trapiche project, ~~to be 571 million tons,~~ with an average grade of ~~0.46 percent~~0.39% of copper, ~~and 0.075 percent~~0.01% of molybdenum ~~into the Trapiche porphyry~~ and ~~Millocucho skarn.~~

~~Hualgayoc.~~ ~~Hualgayoc is~~3.2 grams per ton of silver. During 2016 we expect to have a ~~silver, zinc and lead exploration project,~~positive scoping study for a leach only alternative. We estimate there are 251 million tons of leachable material with copper and gold potential, owned by Consolidada de Hualgayoc S.A., or Consolidada, which is 50 percent owned by Colquirrumi, our 99.99 percent-owned subsidiary, and 50 percent owned by Gold Fields La Cima S.A.A., a wholly-owned subsidiaryan average grade of ~~Gold Fields. Colquirrumi has been the operator of the project since 2011. Consisting of 15,417 hectares of mining concessions owned by Consolidada, the project is located~~0.54% copper in the Hualgayoc district, Cajamarca region. During 2012, we invested US$5.7 million to conduct 7,143 meters of diamond drilling and, in 2013, we intend to invest US$1.0 million to continue our drilling campaign.

project.

~~El Faique.~~

Pisaccalla.The El Faique project is wholly owned and operated by us. The project encompasses 13,209 hectares of mining concessions owned by us and is located in the Sechura desert of northern Peru in the Piura region. The El FaiquePisaccalla project consists of a deep massive sulfide deposit evidenced by diamond drilling. Pursuant to our exploration program, we have invested in social infrastructure and support for local communities in order to obtain surface permits and properties. In 2012, we invested US$1.0 million to continue our efforts to negotiate with local communities. In 2013, we plan to invest US$2.5 million to conduct a diamond drilling campaign. We are working to obtain community consent and environmental permits in the second half of 2013.

~~Colquemayo.~~~~The Colquemayo project is wholly owned by us and encompasses 28,800~~11,331 hectares of mining concessions located in the ~~Moquegua~~Ayacucho region in southern Peru ~~70 kilometers southwest~~and is wholly-owned by Buenaventura. In 2015, we explored 822 meters of the ~~Chucapaca project.~~Accocuruz project through diamond drilling without positive results. We do not plan to conduct any further work in this project and all exploratory surface work has been remediated. On the other hand, in the geological mapping and sampling for the Ccelloccasa project, we identified 5.33 kilometers of outcropping veins with encouraging results. During 2016, we plan to carry out a geophysical survey and obtain the necessary environmental and social permits in order to conduct a drilling campaign in 2017.

Livitaca. The Livitaca project is located in tertiary volcanic rocks covered by younger volcanic events. The high sulfidation alteration system covers an area of 40 square kilometers. During 2012, we invested US$4.0 million to conduct 5,319 meters of diamond drilling and, during 2013, we intend to invest US$1.5 million to continue drilling.

~~Surichata.~~ ~~Surichata is a new exploration project located~~the Cusco region in ~~the Puno region of~~ southern Peru, ~~consisting~~8 kilometers north of ~~17,800~~the Constancia copper project owned by Hudbay. The project consists of 9,095 hectares of mining concessions owned by Corporación Aceros Arequipa S.A., which has leased those hectares to Cía. de Minas Cerro Hablador S.A.C., our newly formed wholly-owned subsidiary. The project is an iron skarn with surrounding gold and copper mineralization. In 2015, we determined that the project does not have adequate potential. We do not plan to carry out any additional work at this project.

Palla Palla. Palla Palla is located in the Ayacucho region. The property consists in 6,894 hectares of mining concessions owned by Cia. de Minas Caudalosa S.A., which ~~we own 15,900~~has leased those hectares ~~and lease 1,900 hectares from~~to Minera ~~Joncijirca~~Azola S.A.C. ~~The Surichata project shows evidence of epithermal silver enriched polymetallic veins. In 2012, we invested US$1.1 million~~, our wholly-owned subsidiary. We are working to ~~conduct 2,932 meters of~~obtain the environmental permit needed to execute a diamond drilling ~~as part~~campaign of ~~a first-pass~~4,000 meters at the Cerro Runtus project during the second half of 2016.

San Gregorio. The drilling ~~campaign. In 2013,~~program at this project continues to be suspended due to the opposition of the Vicco community. We have resumed discussions with the community and, due to the active participation of the Conflict Resolution Office, an entity operating under the auspices of thePresidencia del Consejo de Ministros(“PCM”), in such discussions, we ~~plan~~expect to ~~invest US$3.1 million in a second~~resume the drilling ~~campaign.~~program at this project.

~~Brownfield~~

Exploration ~~Projects~~in Operating Areas

Uchucchacua. The Uchucchacua brownfield exploration project is located throughout 8,430 hectares of our mining and exploration properties and 1,500 hectares of property owned by a joint venture between us and Minera Focus S.A.C. We are currently focusing our exploration efforts on ~~three prospects: Anamaray,~~the Yumpag ~~and Chanca.~~

~~The Anamaray prospect~~project, which is considered an epithermal deposit of silver, lead and zinc in a setting of tectonic breccias and veins in cretaceous limestone. In 2012, we invested US$2.19 million to explore the parallel veins close to the Falla longitudinal fault and explore the San Francisco mineralized structure in greater depth with 5,253 meters of diamond drilling and 2,205 meters of underground tunnels. We decided to halt our exploration of the Anamaray prospect at the end of 2012 due to disappointing results, and do not plan to invest further in this prospect in 2013.

~~The Yumpag prospect consists of 1,847 hectares~~ located 4four kilometers northeast of the Uchucchacua mine. The ~~Yumpag prospect~~project is an epithermal ~~deposit of~~ silver ~~lead, zinc and manganese~~deposit, structurally influenced by the Cachipampa ~~geological~~fault. This fault ~~which~~ also influences significant areas of silver mineralization at the Uchucchacua mine. During ~~2012,~~2015, we invested US$~~0.41~~3.63 million ~~mainly to complete mine audits~~ and ~~obtain necessary permits. In 2013, we plan to invest approximately US$5.74 million to complete 2,150 meters of tunnels and undertake 1,500~~completed 8,398 meters of diamond drilling ~~in an effort to continue exploration of the Yumpag prospect.~~and conducted metallurgical tests with encouraging results. As of December 31, ~~2012,~~2015 we ~~had~~ estimated NRM of ~~147,096 dry short~~0.63 million tons, ~~or DST,~~ with ~~9.26~~26.3 ounces per ton of silver, ~~0.016 ounces per ton of gold, 1.68 percent~~0.5% lead, 1.3% zinc and ~~1.23 percent zinc.~~

~~Mallay.~~ ~~Our exploration efforts~~19.3% manganese. In 2016, we expect to invest US$2.30 million in ~~this area include the old Chanca silver mine and surrounding area of Chanca, which encompasses the Candelaria, Santa Rosa and Chiptaj brownfield exploration areas.~~

~~The Chanca prospect is located in the province of Oyón, department of Lima, about 15 kilometers northwest of Mallay-Isguiz and adjacent~~order to the old Chanca silver mine. The Chanca prospect consists of about 3,880 hectares, including the Chiptaj exploration area, and 1,500 hectares of what has historically been a joint venture between us and Minera Focus S.A.C. During 2012, we invested US$10.00 million and completed 10,421conduct 8,000 meters of diamond drilling and 3,906 meters of exploration tunnels, focusing primarily on the Shirley, Tarazca, Poderoso, Candelaria and Santa Rosa veins. In 2013, we plan to invest US$4.80 million to complete 4,200 meters of exploration tunnels and 7,200 meters of diamond drilling.at this project.

Orcopampa. ~~The Orcopampa brownfield~~During 2015, our main exploration focus was in the Pucay project, is located on a total of 18,000 hectares of our mining and exploration concessions and 6,850 hectares of property to which we have access as a result of option agreements with SCC (in respect of Pucay) and Compañía Minera Ares S.A.C., or Minera Ares (in respect of Pariguanas). We are currently focusing our exploration efforts on Pariguanas, Ocoruro, Quello and Aseruta.

~~The Pariguanas project is located 24~~3.5 kilometers northeast of Chipmo and consists of 4,440 hectares, 2,240 hectares of which we own and 2,200 hectares to which we have access as a result of a joint venture agreement with Minera Ares. Pariguanas is considered an epithermal low sulfidation deposit mainly of silver and gold. During 2012, we invested US$2.69 million in diamond drilling works.

The Ocoruro project consists of 2,085 hectares and is located 2 kilometers west of the Chipmo mine. In 2012, we continued the diamond drilling campaign to define a mineralized vein system with gold and silver deposits, which we classified as low sulphidation epithermal deposits. In 2012, we invested US$2.75 million, mainly in diamond drilling. In 2013, we plan to invest US$1.40 million to complete a diamond drilling program and conduct geophysical surveys.

~~The Quello project consists of 1,118 hectares and is located 3.3 kilometers northwest~~southwest of the Chipmo mine. This project consists of 2,400 hectares of mining concessions owned by SCCO, which leased those hectares to Apu Coropuna S.R.L., our newly formed wholly-owned subsidiary. In Pucay, we focused on the Anquicha project, which shows encouraging results of epithermal gold mineralization in sandstone-hosted oxidized fractures and breccias. Preliminary column leach tests show gold recoveries of around 89%. In 2016, we will continue geological mapping and sampling at the Anquicha and Huiscatori projects.

The Alejandra - La Zanja. In April 2015, we ceased underground explorations in the Alejandra vein. As of December 31, 2015, we estimated a ~~system~~NRM of ~~veins that contain gold. In 2012, we performed a geophisycal survey which showed two interesting geophisycal anomalies that may be related to the mineralized structures Sausa Norte~~0.22 million tons, with 10.4 grams per ton of gold and ~~Sausa Centro. During 2012,~~170 grams per ton of silver. Additionally, we invested US$~~0.77~~6.6 million ~~mainly~~to conduct geological mapping, sampling and a geophysical survey in ~~geological surveys. In 2013, we plan~~the northeast extension of the Alejandra trend, which allowed us to identify a series of echelon epithermal veins with encouraging values in gold and silver. We expect to invest US$1.5 million in order to ~~explore mineralized structures that were evidenced by our geophysical survey.~~

The Aseruta-Allhuire project consists of 2,925 hectares and is located 8 kilometers southeast of the town of Orcopampa. It consists of a system of veins with mainly silver content. We performed geophysical studies, which showed mapped veins and probable hydrothermal breccia body at depth. During 2012, we invested US$0.29 million, mainly to perform geological mapping and sampling. In 2013, we plan to invest US$1.50 million to develop a diamond drilling program at the main veins.

~~Poracota.~~The Poracota brownfield exploration project currently encompasses 6,680 hectares of mining concessions owned and operated by us and is located 20 kilometers west of the Orcopampa mine in southern Peru. The mineral deposit is considered an epithermal high sulfidation system, hosted in volcanic rocks, mainly tuffs. The deposit is comprised of two main areas, Huamanihuayta and Perseverancia.

The Huamanihuayta Oeste project consists of 440 hectares and is located 1 kilometer southwest of the Poracota mine. In 2012, we invested US$2.07 million in diamond drilling, focusing primarily in the southwest extension of the main veins María Fe, Silvana and Malena. We also explored additional veins that are part of the vein system for the Poracota mine. In 2013, we plan to invest US$1.0 million to continue exploration of these veins and the Faculla and Soras projects, which consist of 1,102 hectares.

~~Julcani-Recuperada.~~ The Julcani-Recuperada brownfield exploration project currently encompasses 3,213 hectares of mining concessions and is wholly owned and operated by us. During 2012, we invested US$0.84 million to perform geological surveys, outcrops sampling and 792conduct 5,000 meters of ~~diamond drilling. In 2013, we expect to invest US$1.4 million, mainly on~~ diamond drilling in the ~~Escopeta and Patara prospects.~~second quarter of 2016.

~~Tambomayo~~.Tambomayo project is wholly owned and operated by us. The project encompasses a total of 27,900 hectares, of which 25,700 hectares are owned by us and 2,200 hectares are optioned by Minera Ares. This option contract expires in 2015.

Tambomayo project is located 20 kilometers east of the Paula mine. The project is considered a low sulfidation epithermal deposit with significant gold and silver mineralization in a vein system. During 2012, we continued the underground exploration tunnels to explore the Mirtha and Paola veins. As of December 31, 2012, we had estimated NRM of 1,269,296 DST, with 0.323 ounces per ton of gold, 7.69 ounces per ton of silver, 1.5 percent lead and 2.86 percent zinc. In 2012, we invested US$16.77 million in the exploration and development of the Mirtha vein and a diamond drilling campaign. In 2013, we plan to invest US$38.0 million, mainly for preparation and construction of basic infrastructure, underground exploration and tunnel development.

Competition

We believe that competition in the metals market is based primarily upon cost. We also compete with other mining companies and private individuals for the acquisition of mining concessions and leases in Peru and for the recruitment and retention of qualified employees.

Sales of Metal Concentrates

All of our metal production is sold to smelters, traders and banks, either in concentrate or metal form, such as gold-silver concentrate, silver-lead concentrate, zinc concentrate, lead-gold-copper concentrate and gold and silver bullion. Our concentrates sales are made under one- to three-year, U.S. Dollar-denominated contracts, pursuant to which the selling price is based on world metal prices as follows: generally, in the case of gold and silver-based concentrates, the London Spot settlement prices for gold, less certain allowances, and the London Spot or the United States Commodities Exchange settlement price for silver, less certain allowances; and, in the case of base-metal concentrates, such as zinc, lead and copper, the London Metals Exchange ~~or LME,~~(“LME”) settlement prices for the specific metal, less certain allowances. Sales prices vary according to formulas that take into account agreed contractual average prices for a quotational period, generally being the month of, the month ~~prior to,~~before, or the month following the scheduled month of shipment or delivery according to the terms of the contracts.

The historical average annual prices for gold and silver per ounce and our average annual gold and silver prices per ounce for each of the last five years are set forth below:

Gold Silver

Average Annual
Market Price

Our Average
Annual Price⁽¹⁾

Average Annual
Market Price

Our Average
Annual Price⁽¹⁾

US$/oz. ⁽²⁾ US$/oz. US$/oz.⁽³⁾ US$/oz.
2008 871.71 872.21 15.02 14.26
2009 972.98 988.32 14.65 15.52
2010 1,224.66 1,253.35 20.16 20.86
2011 1,568.58 1,574.45 35.11 35.36
2012 1,668.98 1,678.92 31.15 31.25
2013 (through March 31, 2013) 1,631.77 1,606.08 30.11 29.92

	Gold				Silver
	Average Annual Market Price		Our Average Annual Price⁽¹⁾		Average Annual Market Price		Our Average Annual Price⁽¹⁾
	US$/oz.⁽²⁾		US$/oz.		US$/oz.⁽³⁾		US$/oz.
2014		1,266.40		1,263.53		19.08		18.65
2015		1,218.45		1,151.44		16.71		15.06
2016 (through March 31, 2016)		1,182.56		1,107.87		14.85		13.34

(1)

Our average annual price includes only the consolidated average annual price from ~~the Julcani, Uchucchacua, Orcopampa, Antapite, Recuperada, Colquijirca, Marcapunta, Ishihuinca and Shila~~our mines.

(2)

Average annual gold prices are based on the London PM fix as provided byMetals Week.

(3)

Average annual silver prices are based on London Spot prices.

Most of the sales contracts we enter into with our customers state a specific amount of metal or concentrate the customer will purchase. We have sales commitments from various parties for nearly all of our estimated ~~2013~~2016 production; however, concentrates not sold under any of our contracts may be sold on a spot sale basis to merchants and consumers.

Sales and Markets

The following table sets forth our total revenues from the sale of gold, silver, lead, zinc and copper in the past ~~three~~two fiscal years:

	Year ended December 31⁽¹⁾						Year ended December 31,⁽¹⁾
Product	2010		2011		2012		2014		2015
	(In thousands of US$)						(US$ in thousands)
Gold		578,582		791,387		738,477		554,805		438,585
Silver		274,624		526,380		544,947		356,021		316,692
Lead		46,913		36,880		52,834		39,658		55,445
Zinc		92,884		72,095		82,873		47,653		102,110
Copper		129,444		193,215		177,573		271,282		131,356

~~(1) Does not include refinery charges and penalties incurred in 2012, 2011 and 2010 of US$147,930, US$127,957and US$112,254, respectively.~~

(1)

Does not include refinery charges and penalties incurred in 2015 of US$196.2 million and in 2014 of US$184.51 million.

~~We sold our concentrates to 20 customers in 2012.~~ Approximately ~~54 percent, 57 percent~~60.12% and ~~62 percent~~62.83% of our concentrate and gold bullion sales in ~~2010, 2011~~2014 and ~~2012, respectively,~~2015 (without considering adjustments to prior periods, embedded derivatives from sale of concentrate or hedge operations), were sold outside Peru. Set forth below is a table that shows the percentage of sales of concentrate and gold bullion from our mines and gold bullion that were sold to our various customers from ~~2010~~2014 to ~~2012.~~2015.

Percentage of Concentrates and Gold Bullion Sales
2010 2011 2012
Export Sales:
Johnson Matthey Limited 49.90 % 47.42 % 47.75 %
Glencore International AG 0.75 0.48 -
N.V. Umicore SA 2.18 4.14 1.34
Transamine Trading SA - - 0.35
J.P. Morgan Chase Bank - - 1.97
MRI Trading AG 0.13 3.20 5.60
MK Metal Trading GMBH 0.19 1.23 1.36
Lois Dreyfus Commodities Metal Suisse SA - - 0.24
Standard Bank PLC 0.04 - -
Korea Zinc Company Ltd. - - 2.99
Mintrade Ltd. 0.39 - -
Xstrata Commodities 0.39 0.19 0.36
Total Export Sales 53.97 % 56.66 % 61.96 %

Domestic Sales:
Doe Run Perú SRL - - 1.08
Glencore Peru S.A.C. 7.76 18.93 17.91
Consorcio Minero SA 10.62 6.89 5.88
Votorantim Metais – Cajamarquilla SA 3.33 2.57 0.42
Sudamericana Trading SRL 1.15 2.58 2.44
Ays SA 10.50 - -
MK Metal Trading Perú SAC 0.88 0.39 0.14
Louis Dreyfus Peru SAC 10.54 10.66 8.11
Traxxys Peru SAC 1.25 1.23 0.95
Cia. Minera Casapalca S.A. - 0.09 0.20
Total Domestic Sales 46.03 % 43.34 % 38.04 %
Total Sales 100 % 100 % 100 %

	Percent of Concentrates and Gold Bullion Sales
	2014			2015
Export Sales:
Asahi Refining Canada Ltd (former Johnson Matthey)		49.31			50.58
N.V. Umicore SA		3.89			3.75
Werco Trade AG		3.34			2.07
Mercuria Energy Trading SA		0.00			1.43
MRI Trading AG		0.00			0.99
Lois Dreyfus Commodities Metal Suisse SA		0.00			2.06
MCC non Ferrous Trading Inc.		2.61			0.00
Others		0.97			1.98
Total Export Sales		60.12	%		62.86	%

Domestic Sales:
Andina Trade S.A.C.		0.93			0.36
Glencore Peru S.A.C.		15.27			23.43
Consorcio Minero SA		4.11			0.00
Trafigura Peru S.A.C.		4.59			6.73
Sudamericana Trading SRL		2.65			2.85
Lois Dreyfus Commodities Peru S.R.L.		10.21			2.45
Optamine S.A.C.		1.26			0.17
Others		0.86			1.16
Total Domestic Sales		39.88	%		37.14	%
Total Sales		100	%		100	%

The following table shows our committed sales volumes of silver-lead, gold-silver and zinc concentrates from ~~2013~~2016 to ~~2015:~~2018:

	Wet metric tons		Wet metric tons		Wet metric tons		Wet tons		Wet tons		Wet tons
Concentrate	2013		2014		2015		2016		2017		2018
Recuperada’s Silver-Lead		6,000		6,000		6,000
Recuperada’s Zinc		9,600		-		-
Uchucchacua’s Silver-Lead		31,900		21,500		-		68,000		55,800		28,000
Uchucchacua’s Zinc		25,000		25,000		-		23,800		23,900		0
Poracota’s Gold-Silver		-		-		-
Julcani’s Silver-Lead		6,800		-		-		7,600		3,200		4,000
Mallay’s Silver-Lead								20,000		14,700		0
Mallay’s Zinc								20,000		17,700		5,000

Note: The price of the concentrate supplied under the contract is based on specified market quotations minus deductions.

We also sell refined gold, which is derived from our operations at Orcopampa, ~~Shila-Paula, Antapite, Ishihuinca~~Breapampa, Coimoloache and La Zanja and processed at a local smelter in Lima, to Johnson Matthey Public Limited Company, or Johnson Matthey, which further refines the gold. Pursuant to our agreement with Johnson Matthey, we supplied Johnson Matthey, at our option, with gold assaying in excess of 75 percent gold and approximately 25 percent silver, monthly from January 1, 2012 to December 31, 2012. TheDuring 2015, the price of the gold supplied was determined based on, for the gold content, the quotation for gold at the London Gold Market PM fixing in U.S. Dollars, and for the silver content, the quotation for silver at the London Silver Market spot fixing in U.S. Dollars or at spot prices, minus, in each case, certain minimum charges, as well as charges for customs clearance and treatment of the gold (which varies depending on its gold and silver content). We may elect to have our material toll refined at Johnson Matthey’s Brampton, Canada works and returned to our account for sale to third parties. Pursuant to our agreement, we are responsible for delivering the gold to Johnson Matthey’s designated flight at the Lima airport.

Hedging/Normal Sales Contracts

We and our wholly-owned subsidiaries are completely unhedged as to the ~~price~~prices at which our gold and silver will be sold. See “Item 3. Key Information—D. Risk Factors—Factors Relating to the Company—Our financial performance is highly dependent on the prices of gold, silver, copper and other metals.”

El Brocal ~~has not~~uses derivative instruments to manage its exposure to changes in the price of metals. Such derivative financial instruments are initially recognized at fair value on the date on which a derivative contract is entered into ~~any new hedging transactions since 2010~~ and ~~has no outstanding hedging commitments.~~are subsequently re-measured at fair value. Derivatives are carried as financial assets when the fair value is positive and as financial liabilities when the fair value is negative.

El Brocal’s hedge is classified as a cash flow hedge. The effective portion of gain or loss on the hedging instrument is initially recognized in the consolidated statements of changes in equity, under the caption other equity reserves, while the ineffective portion is recognized immediately in the consolidated statements of profit or loss in the interest expense caption. Yanacocha and Cerro Verde have not engaged in, and are currently not engaged in, gold or copper price hedging activities, such as forward sales or option contracts, to minimize their respective exposures to fluctuations in the price of gold and copper. El Brocal had no outstanding hedging commitments in 2015.

Regulatory Framework

Mining and Processing Concessions

In Peru, as in many other countries, while surface land is owned by private landowners, the government retains ownership of all subsurface land and mineral resources. Our right to explore, extract, process and/or produce silver, gold and other metals is granted by the Peruvian government in the form of mining and processing concessions. The rights and obligations of holders of mining concessions, provisional permits and processing concessions are currently set forth in the General Mining Law (Single Unified Text approved by Supreme Decree 014-92-EM), which is administered by the MEM.

Pursuant to the General Mining Law, filers of mining claims must obtain a mining concession before they may explore the areas claimed. Applications for mining concessions must be filed with the regional mining directors of each regional government and with ~~INGEMMET (~~Instituto Geológico Minero y Metalúrgico~~, or~~ the Geological, Mining and Metallurgical Institute of ~~Peru)~~Peru (“INGEMMET”).

Mining concessions ~~granted since October 2008~~are irrevocable, provided the holder of a mining concession complies with the obligations set forth in the General Mining Law. Such concessions have an indefinite term, subject to payment of an annual concession fee per hectare claimed and achievement of minimum annual production for each hectare. Failure to achieve annual production targets will result in a fine. Failure to pay concession fees or fines for two consecutive years could result in the loss of one or more of the mining rights. Failure to satisfy minimum annual production thresholds for a specified period of time could result in cancellation of the concessions.

Our and Yanacocha’s processing concessions enjoy the same duration and tenure as our mining rights, subject to payment of a fee based on nominal capacity for the applicable processing plant. Failure to pay processing fees or fines for two consecutive years could result in the loss of the processing concessions.

~~As of December 31, 2012, we owned and administered, directly or indirectly, through subsidiaries or in conjunction with joint venture partners, approximately 1,194,021 hectares of~~Our mining ~~concessions devoted to mineral exploration and mining operations. Mining~~ rights and processing concessions are in full force and effect under applicable Peruvian laws. We believe that we are in compliance with all material terms and requirements applicable to the mining rights and processing concessions and that we are not subject to any condition, occurrence or event that would cause the revocation, cancellation, lapse, expiration or termination thereof, except that we may, from time to time, allow to lapse, revoke, cancel or terminate mining rights and processing concessions that are not material to the conduct of our business.

In addition to obtaining mining rights from the Peruvian government, applicable Peruvian regulations require us to obtain easements or other rights from private landowners that own the surface land above the mineral resources that we intend to explore or mine. Supreme Decree 020-2008-EM requires us to obtain such easements or other rights ~~prior to~~before commencing exploration activities. We have been actively seeking to acquire land surface, easements to land containing prospective geological exploration target sites, deposits that can be exploited in the future and areas suitable as plant or facility sites. In the case of processing concessions, article 35 of Supreme Decree Nº 018-92-EM, as amended, requires holders of such concessions to own the land underlying the concession or to have the authorization of the owner of the land.

The Law Regulating Mining Concessions in Urban Areas and Urban Expansion Areas and related regulations set forth procedures for the granting of mining rights in urban and urban expansion areas. ~~In order to~~To grant a mining concession in an ~~urban or~~ urban expansion area, the MEM is required to receive the approval of the council of the applicable provincial municipality. The council has sixty days to issue its decision. Mining concessions in urban expansion areas are granted for 10-year terms, which may be renewed by the MEM subject to the approval of municipal ~~authorities.~~authorities, but cannot exceed 100 hectares.

Law No. 28964, which became effective on January 25, 2007, created theOrganismo Supervisor de la Inversión en Energía y Minería(~~OSINERGMIN~~ (“OSINERGMIN”) as the government agency in charge of regulating and auditing the electricity, hydrocarbon and mining activities of companies. Law No. 28964 provides that the overview and audit of activities related to the environment, mining safety and health regulations may be performed by companies duly certified and approved by OSINERGMIN.However, pursuant to Supreme Decree 001-2010-MINAM, OSINERGMIN has transferred its environmental supervisory functions to the Environmental Evaluation and Oversight Agency, ~~or OEFA.~~(“OEFA”). Beginning July 22, 2010, OEFA assumed the authority to carry out unexpected audits and levy fines on companies if they fail to comply with prescribed environmental standards. Contributions that mining companies are required to make to OSINERGMIN were approved by Supreme Decree No. 128-2013-PCM and contributions required to be made to OEFA by Supreme Decree No. 130-2013-PCM.

~~Law No. 28964 has been abrogated by Law No. 29783 with~~With respect to employee safety and employer liability, ~~which~~Law No. 28964 has been replaced by Law No. 29783. Such employee safety and employer liability and related matters are audited by theMinisterio de Trabajo y Promoción del Empleo. Law No. 29783, as amended by Law No. 30222, establishes the minimum rules designed to prevent employee safety risks and allocate liabilities in relation to such risks. The main principle of this law is that the employer assumes the economic, legal and any other type of liability arising from accidents or diseases suffered by the employee while working, and guarantees the employee’s health and safety in connection with the employee’s work. This legislation entitles labor inspectors to inspect commercial facilities and, under certain circumstances, suspend operations. Such law amended the relevant provision of the criminal code, which currently establishes that a person who intentionally breaches the safety and health provisions, and who after being required by the relevant authority, does not adopt the measures contemplated in such provisions, is deemed to jeopardize the life, health or physical integrity of such person’s employees and may be held criminally liable for such behavior.

Environmental Matters

In 2005, Peru enacted the General Environmental Law (Law No. 28611), which establishes the main environmental guidelines and principles applicable in Peru. Pursuant to the General Environmental Law, the ~~MEM has~~Ministry of the Environment (“MINAM”) issued ~~regulations mandating~~national environmental standards, ~~for the mining industry and reviews and approves~~which have gradually replaced prior guidelines governing governmental agencies environmental ~~studies for mining operations.~~competencies. OEFA has the authority to inspect mining operations and fine companies that fail to comply with prescribed environmental standards.

The MEM has issued regulations that establish maximum permissible levels of (i) emissions of liquid effluents and (ii) elements and compounds present in gaseous emissions resulting from the mining activities. Generally, holders of mining rights and processing plants that were in operation prior to May 1993 are required to comply with maximum permissible levels within 10 years. In the interim, mining operators are required to prepare Environmental Adaptation and Management Programs, or PAMAs, that set forth plans to ensure compliance with more stringent maximum permissible levels.

~~In addition, each~~Each mining company that ~~initiated~~began operations ~~prior to~~before May 1993 was required to file a Preliminary Environmental Evaluation, ~~or EVAP,~~(“EVAP”), for each of its mining units to disclose any pollution problems in its operations and, thereafter, to submit a follow-up ~~PAMA~~Programa de Adecuación y Manejo Ambiental (“PAMA”) aimed at implementing measures ~~in order~~ to solve problems identified in the EVAP. Companies must correct the pollution problems relating to their mining activities within five years, while smelters must ~~comply~~take corrective measures within ten years. These companies must allocate funds in an amount corresponding to no less than ~~1 percent~~1% of their annual sales to redress the problems identified in their EVAPs and contemplated in their PAMAs.

~~Since~~In addition, the MEM has issued regulations that establish maximum permissible levels (“LMP”) of (i) emissions of liquid effluents and (ii) elements and compounds present in gaseous emissions resulting from the mining activities. Generally, mining rights holders and processing plants that were in operation before May 1993 ~~new mining and processing activities have been required to file and obtain approval for an EIS before being authorized to commence operations. New mining and plant processing activities are~~were required to comply with LMP within 10 years. In the ~~maximum permissible levels for liquid effluents from the initiation of their operations.~~

~~Many of our~~meantime, mining ~~rights~~operators are required to prepare Environmental Adaptation and ~~processing plants were in operation prior~~Management Programs, or PAMAs, that set forth plans to ~~May 1993, and we are in substantial~~ensure compliance with the maximum permissible levels set forth in the MEM’s regulations. EVAPs for Julcani, Uchucchacua, Orcopampa, Recuperada, Ishihuinca and Shila were all accepted between August and September 1995. Between November 2002 and April 2003, the MEM approved and verified the PAMAs for all these entities, issuing and approving resolution for each respective mining unit. The EISs for Paula, Antapite, Esperanza, Poracota and Pozo Rico were approved in 2001, 2001, 2006, 2007 and 2008, respectively.

~~EISs for capacity expansion at the Orcopampa, Uchucchacua and Antapite mines were approved in 2004, 2006 and 2008, respectively.~~

The MEM approved the EISs for the Huancarama-Chipmo-Poracota and La Zanja transmission lines and their substations in 2006 and 2008, respectively. This connection to the national grid should result in lower energy costs.more stringent LMP.

In May 2008, the ~~Environmental~~ Ministry of ~~Peru~~Environment was established by legislative decree. The principal functions of the ~~Environmental~~ Ministry of Environment include formulating and implementing policies and regulations relating to environmental matters and controlling pollution, including regulating air and water quality standards, through supervision and education.

In 2008 and 2010, the Ministry of Environment enacted new water quality standards and new LMP for liquid effluents. In 2009, all Peruvian mining companies were required to submit updated environmental management plans to the MEM that complied with water quality standards and new LMP for liquid effluents. At the end of 2015, Supreme Decree No. 015-2015 - MINAM (the “2015 Decree”) was published, which modified the water quality standards and established supplementary provisions related to compliance.

Under the 2015 Decree, mining companies must incorporate new water quality standards into affected environmental management plans by (1) where the MEM has already approved such plan, submitting an updated plan or (2) where the MEM is currently evaluating a plan, submitting a modified plan. The Company plans to submit updated and modified plans to the MEM as required by the 2015 Decree.

On March 26, 2013, Supreme Decree No. 002-2014-MINAM became effective. It approves the Environmental Quality Standards (Estándares de Calidad Ambiental) (“ECA”) for soils, or “Standards,” which are applicable to any project or activity that may generate an environmental risk. Subsequently, on March 25, 2014, supplementary provisions for the application of the Standards were approved through Supreme Decree No. 002-2014-MINAM. Operations of projects existing at that time were required to submit the first phase of soil characterization within twelve months of the passage of the decree. Buenaventura and its associated companies submitted this information within the required time.

Since May 1993, new mining and processing activities have been required to file and obtain approval for an EISd before being authorized to commence operations. New mining and plant processing activities are required to comply with the LMP from the initiation of their operations. In 2009, MINEM approved the ~~EISs~~EISd for the La Zanja, Mallay, Tantahuatay and Esperanza projects. In 2010, ~~the MEM~~MINEM approved the ~~EISs~~EISd for the Angélica Rublo Chico project. In 2011, the MEM approved the ~~EISs~~EISd for our Orcopampa and Breampampa projects. ~~The MEM~~MINEM approved the modified ~~EIS~~EISd for the Mallay mine and the second modified ~~EIS~~EISd for the Shila cyanidation circuit in 2012. In 2014, MINEM approved the modified EISsd of Uchucchacua. In 2015, the EISd of Tambomayo was approved.

We and our subsidiaries are subject to ongoing administrative and judicial proceedings relating to environmental matters for which we have reserved contingencies of up to US$1.2 million This amount does not include loss contingencies reserved for associates accounted for under the equity method (Yanacocha, Cerro Verde and Coimolache).

In 2012, Peru enacted Supreme Decree ~~N° 020-2012,~~No. 020-2012-EM, which ~~requires all activities~~added Chapter XVII to the Mining Proceedings Regulations approved by Supreme Decree No. 018-92-EM. The new provisions require the approval of the General Mining Directorate of the MEM or of the relevant Regional Government before proceeding to start and re-start exploration, development, preparation and exploitation to obtain the approval of the Mining Department of the Ministry of Energy and Mines. With regard to water regulation, all Peruvian mining companies were required to submit their updated environmental management plans to comply with water quality standards and the new maximum permissible levels for liquid effluents by August 31, 2012. Buenaventura and its associated companies submitted our plans. We expect that we will be required to implement these plans and be in compliance with the new maximum permissible levels for liquid effluents and water quality standards by 2014 and 2015, respectively.

~~Except as described above, there are no material legal or administrative proceedings pending against us with respect to any environmental matters.~~exploitation.

Regulations governing mining explorations. InIn May 2008, the Peruvian government enacted DS 020-2008-EM, which governs mining exploration activities and related matters. Under DS 020-2008-EM, exploration activities ~~are divided~~fall into 2 ~~categories,~~categories: Category I and Category II. Category I exploration activities are those involving no more than 20 drilling platforms ~~and environmentally~~or affecting ~~no more~~a surrounding area that measures less than 10 hectares in size, while Category II exploration activities are those involving more than 20 drilling platforms and ~~environmentally~~ affecting ~~more~~an area larger than 10 hectares. For Category I exploration activities, an Environmental Impact Declaration ~~or EID,~~(Declaración de Impacto Ambiental) (“EID”) is required. For Category II exploration activities, a Semi-detailed ~~Environmental Impact Study, or EISsd,~~EIS (Estudio de Impacto Ambiental) (“EISsd”) which is required which incorporates technical, environmental and social matters. Exploration activities must start within twelve months following the date that an EID or EISsd is approved. ~~The~~Both the EID and the EISsd must be approved before exploration activities begin. Any commitments assumed by mining companies in ~~their~~an EID or EISsd ~~and EIS~~ are ~~mandatory;~~mandatory and, if they are not fulfilled, ~~OSINERGMIN~~OEFA has the authority to fine ~~these~~non-compliant mining companies. The regulation also provides that during exploration programs the holder of mining concessions will perform specified closure and post closure activities. In addition, fines can be imposed if exploration programs begin before the EID and the EISsd are approved, and the approval of environmental studies for exploration activities performed within protected natural areas requires the approval of the applicable water authority. Exploration in Prehispanic Archeological Sites (referred to in DS N° 004-2000-ED) is forbidden, unless expressly authorized by the National Institute of Culture.

Also in May 2008, ~~MEM~~MINEM enacted DS 028-2008 which ~~establishes~~regulated the ~~right~~citizen participation process within the framework of ~~every person to participate in the process of making decisions related to the sustainable development of mining activities on government territory.~~environmental permit approval. The EID ~~EIS~~ and EISsd ~~require~~provide local communities ~~to have~~with an opportunity to actively ~~participate~~engage in this process.

The following EIDs and EISsd were approved in ~~2012:~~2015:

Buenaventura
Mine/Project	Type of Study	Approving Resolution	Date of Approval
~~Escopeta~~	~~EID~~	~~N° 064-2012-MEM-AAM~~	~~June 20, 2012~~
~~Aguila~~	~~EID~~	~~N° 349-2012-MEM-AAM~~	~~October 10, 2012~~
San ~~Lorenzo~~Gabriel	~~EID~~3ra Modf. EIAsd	RD N° ~~083-2012-MEM-AAM~~345-2015-MEM-DGAAM	~~October 10, 2012~~
~~Surichata~~	~~EID~~	~~N° 060-2012-MEM-AAM~~	~~June 6, 2012~~
~~Esperanza~~	~~EISsd~~	~~N° 212-2012-MEM-AAM~~	~~July 7, 2012~~
~~Pariguana~~	~~EISsd~~	~~N° 304-2012-MEM-AAM~~	~~September 18, 2012~~
~~Yumpag~~	~~EISsd~~	~~N° 193-2012-MEM-AAM~~	~~June 6, 2012~~
~~Santa Rosa~~	~~EISsd~~	~~N° 066-2012-MEM-AAM~~	~~February 28, 2012~~04 – 09 - 2015

La Zanja SRL
Mine/Project	Type of Study	Approving Resolution	Date of Approval
La Zanja	~~EISsd~~9na Modf. EIAsd	RD N° ~~285-2012-MEM-AAM~~483-2015-MEM-DGAAM	~~September 5, 2012~~16 – 12 - 2015

~~Mollé Verde S.A.C.~~
~~Mine/Project~~	~~Type of Study~~	~~Approving Resolution~~	~~Date of Approval~~
~~Trapiche~~	~~Mod EISsd~~	~~N° 214-2012-MEM-AAM~~	~~July 4, 2012~~

Investment Promotion Regulations.Supreme Decree 054-2013-PCM was passed to promote investment projects. It allows companies to submit a technical report to modify ancillary components, capacity expansions, or introduce technological improvements. MINEM will then issue a compliance waiver within no more than 15 working days from the date of submission.

Regulations governing mine closures. In 2003, Law No. 28090,Ley que Regula el Cierre de Minas (Law that Regulates the Closing of Mines), established the obligations and procedures that mining companies must follow to prepare, submit and execute plans for the closing of mines, or ~~Closure~~“Closure Plans,” and the granting of environmental guarantees to secure compliance with Closure Plans. We are required to submit a Closure Plan for new projects to ~~the MEM~~MINEM within one year following approval of an EIS or PAMA; inform ~~the MEM~~MINEM semi-annually of any progress on the conditions established in the Closure Plan; perform the Closure Plan consistent with the schedule approved by ~~the MEM~~MINEM during the life of the ~~concession;~~project; and ~~grant~~set up an environmental guarantee that covers the estimated amount of the Closure Plan.

In addition, Supreme Decree No. 020-2008-EM requires mining companies that perform exploration activities to conduct certain closing activities in accordance with the applicable environmental study approved by the relevant authority, subject to deferral under certain circumstances, and contemplates a Closure Plan to be submitted by the mining companyfollowing the terms and conditions of Supreme Decree Nº 033-2005-EM.

~~We have presented~~

Our Closure Plans ~~to the MEM~~were approved by MINEM for all of our mines and advanced explorations. To date, ~~the MEM~~MINEM has approved our Closure Plans for Julcani, Recuperada, Uchucchacua, Orcopampa, Poracota, Antapite, Caravelí, Shila, Paula, Esperanza, Pozo Rico, Mallay, Trapiche, Breapampa, Angélica Rublo Chico, Anamaray-Jancapata, La Zanja, Tantahuatay and ~~Anamaray-Jancapata.~~Tambomayo.

The ~~follow Closure Plan Studies~~following mine closure plan modifications were approved in ~~2012:~~2015:

Buenaventura
Mine/Project	Type of Study	Approving Resolution	Date of Approval
Julcani	Closure Plan Modification	R.D.N°119-2015-MEM/AAM	02.03.2015
Orcopampa	~~Update~~ Closure Plan Modification	~~N° 172-2012-MEM-AAM~~R.D.N°212-2015-MEM/AAM	~~May 29, 2012~~20.05.2015
~~Antapite~~Mallay	~~Modified~~ Closure Plan Modification	~~N° 182-2012-MEM-AAM~~R.D.N°386-2015-MEM/AAM	~~June 6, 2012~~
~~Caravelí~~	~~Update Closure Plan~~	~~N° 213-2012-MEM-AAM~~	~~July 3, 2012~~02.10.2015
Breapampa	Closure Plan Update	~~N° 237-2012-MEM-AAM~~R.D.N°398-2015-MEM/AAM	~~July 17, 2012~~

~~CEDIMIN SAC~~15.10.2015
~~Mine/Project~~
La Zanja SRL
Mine/Project	Type of Study	Approving Resolution	Date of Approval
~~Shila~~La Zanja	~~Update~~ Closure Plan Modification	RD N° ~~197-2012-MEM-AAM~~237-2015-MEM/DGAAM	~~June 15, 2011~~05.06.2015

Compañía Minera Coimolache S.R.L.
Mine/Project	Type of Study	Approving Resolution	Date of Approval
Tantahuatay	Closure Plan Update	R.D. N° 373-2015-MEM-DGAAM	22.09.2015

On November 9, 2009 Supreme Decree No. 078-2009-EM became effective, creating additional environmental obligations for ~~the holders of~~ mining ~~concessions.~~concessions holders. Under this provision, ~~holders of~~ mining concessions holders that ~~have~~ performed mining activities, including mining exploration, ~~exploitation~~production and processing activities or related activities, without having an Environmental Certification will be required to prepare and perform an Environmental Remediation Plan to ~~cure~~address the environmental impact in the areas in which such activities have been conducted. ~~The~~ Environmental Remediation ~~Plan will~~Plans could only be filed once mining activities have ceased. Environmental Remediation Plans would contain a detailed description of all the mining ~~items~~facilities and activities performed without the correspondent Environmental Certification, including maps and related information, a detailed description of the environmental impacts created by such activities, a detailed description of the remediation actions, a detailed description of the compensation that is proposed to be made, a budget and schedule of the remediation activities, including their costs, a bond in favor of ~~MEM~~MINEM for the cost of the execution of the measures contained in the Environmental Remediation Plan. Once the Environmental Remediation Plan is completed, mining concessions holders are required to inform the auditing entity so it can verify that the actions were carried out as approved. The auditing entity is required to send the respective report to the relevant authority so that the bond may be returned.

Law No. 28271, Law that Regulates the Environmental Liabilities of Mining Activities (Ley que Regula los Pasivos Ambientales de la Actividad Minera ~~(Law that Regulates the Environmental Liabilities of Mining Activities)~~), ~~became effective~~came into force on July 7, 2004 and serves to regulate the identification of liabilities ~~in mining activities~~ and financial responsibility for remediation in mining activities, in each case to mitigate any negative impact mining may have with respect to the health of the population, environment and property. Pursuant to Law No. 28271, as amended by Law No. 28526 and Legislative Decree No. 1042, the technical branch of ~~the MEM~~MINEM will identify environmental liabilities, mining companies responsible for abandoned mining facilities, mining works and residue deposits that may be linked to such environmental liabilities and holders of inactive mining concessions with mining liabilities. Holders of inactive mining concessions with environmental mining liabilities will be required to submit a Closure Plan and enter into environmental remediation agreements with ~~the MEM~~MINEM to perform any studies and work necessary to control and mitigate the risk and effects of any contamination. Regulations under Law No. 28271, Regulations of Environmental Liabilities of Mining Activities(Reglamento de Pasivos Ambientales de la Actividad Minera (~~Regulations of Environmental Liabilities of Mining Activities)~~), were approved by Supreme Decree No. 059-2005-EM.

We have presented Closure Plans to the ~~MEM~~MINEM for all our mining concessions with environmental mining liabilities. To date, the ~~MEM has approved the mining liabilities for~~ Hualchocopa, Lircay, Bella Unió~~n-Pucaray~~n-Paucaray and Chaquelle mining units have all been closed and ~~all~~post-closure activities at each of these ~~concessions have been closed.~~units are currently underway.

On November 12, 2014, a new Environmental Protection and Management by-law was enacted, which covers mining production, processing, common labor, transport, and storage, and sets forth a new set of requirements for these activities. Going forward, social and technical teams from MINEM will accompany the collection of baseline information. Early involvement of the statutory authority throughout the environmental studies process is expected to bring about shorter approval times.

On December 28, 2015, theServicio Nacional de Certificación Ambiental, which operates under the auspices of MINAM took responsibility for the approval of detailed EIS, submitted by private, public, or mixed-capital organizations. This development is consistent with the expansion of MINAM’s technical and regulatory capacities.

We anticipate additional laws and regulations relating to environmental matters will be enacted over ~~time with respect to environmental matters.~~time. The development of more stringent environmental ~~protection programs~~regulations in Peru could impose additional constraints and additional costs on our operations, and we would be required to make significant additional capital expenditures in the future. Although we believe that we are substantially in compliance with all applicable environmental regulations of which we are now aware, there is no assurance that future legislation or regulatory developments will not have an adverse effect on our business or results of operations.

In connection with the approval of environmental studies, the Peruvian government has issued several decrees intended to simplify the issuance of permits, including Supreme Decree No. 054-2013-PCM (effective since June 2, 2013), Supreme Decree No. 060-2013-PCM (effective since May 26, 2013) and Ministerial Resolution No. 092-2014-MEM/DM (effective since May 27, 2014). We believe these provisions should facilitate the approval of environmental studies for our new exploration projects and simplify the issuance of certificates of non-existence of archeological remains required for mining projects.

Prior Consultation with Local Indigenous Communities

In 2011, Peru enacted Law No. 29785, the Law of Prior Consultation for Indigenous and Native Communities (Ley del Derecho a la Consulta Previa a los Pueblos Indígenas y Originarios, Reconocido en el Convenio 169 de la Organización Internacional del Trabajo). This law establishes a prior consultation procedure that the Peruvian government must undertake in concert with local indigenous communities whose collective rights may be directly affected by new legislative or administrative measures, including the granting of new mining concessions. Under ~~the~~this law, the Peruvian governmental ~~body~~agency responsible for issuing or approving the administrative measure or decree in question, rather than the affected local indigenous community, retains the right to approve or reject the relevant legislative or administrative matter following such consultation. However, to the extent that any of our future projects require the promulgation of ~~us, Yanacocha or Cerro Verde require~~ legislative or administrative measures that impact local indigenous communities, the required prior consultation procedure may result in delays, additional expenses or failure to obtain approval for such new project.

Regulations under Law No. 29785 were approved by Supreme Decree No. 001-2012-MC, which became effective on April 2, 2012. These regulations specify the form and circumstances of the required consultation and the manner in which agreements will be formalized, and ~~cap the~~provide for a consultation process atthat lasts no more than 120 calendar days.

Permits

We believe that our mines and facilities have all necessary material ~~permits.~~permits to operate. All future exploration projects will require a variety of permits. Although we believe the permits for these projects can be obtained in a timely fashion, permitting procedures are complex, time-consuming and subject to potential regulatory delay. We cannot predict whether we will be able to renew our existing permits or whether material changes in existing permitting conditions will be imposed. Non-renewal of existing permits or the imposition of additional permitting conditions could have a material adverse effect on our financial condition or results of operations.

Insurance

We maintain a comprehensive insurance program designed to address specific risks associated with our operations, in addition to covering the insured risks common to major mining companies. Our insurance program is provided through the local Peruvian insurance market and includes employers’ liability, comprehensive third party general liability and comprehensive automobile liability, all risk property on a replacement basis, including transit risks, as well as business interruption insurance and mining ~~equipment.~~equipment insurance.

Mining Royalties and Taxes

Under Peruvian law, holders of mining concessions are required to pay the Peruvian government a mining royalty (regalia minera) for the exploitation of metallic and non-metallic resources. In accordance with Law No. 28258, as amended by Law No. 29788, mining royalties ~~shall be~~are payable either as a specified percentage of operating profit or ~~1 percent~~1% of revenues, whichever is higher. If the mining royalty is calculated as a percentage of operating profit, marginal rates ranging from ~~1 percent~~1% to ~~12 percent,~~12%, increasing progressively for companies with higher operating margins, will apply.

Mining companies that are a party to mining stabilization agreements will not be required to pay a mining royalty during the tenure of their stabilization agreements. Although we are not party to aany stabilization ~~agreement,~~agreements, Yanacocha currently has effectivestabilization agreements for the Yanacocha, La Quinua and Maqui mines.

In addition to mining royalties, pursuant to Law No. 29789, effective from October 1, 2011, mining operations in Peru are subject to a new extraordinary mining tax. Mining companies that do not have taxation stability agreements with the Peruvian government, such as Buenaventura, will pay the “Special Mining Tax” (Impuesto Especial dea la Minería). The Special Mining Tax is calculated as a percentage of operating profit. Marginal rates range from ~~2 percent~~2% to ~~8.4 percent,~~8.4%, increasing progressively for companies with higher operating margins. Mining companies that have stability agreements with the Peruvian government will pay the “Special Mining Duty” (Gravamen Especial dea la Minería). The Special Mining Duty is calculated as a percentage of operating profit, with marginal rates ranging from ~~4 percent~~4% to ~~13.12 percent,~~13.12%, increasing progressively for companies with higher operating margins.

Safety

During 2015, we experienced 70 reportable injuries, which were comprised of 67 lost-time injuries and 3 fatal injuries, as compared to 86 total reportable injuries during 2014, which were comprised of 81 lost-time injuries and 5 fatal injuries. Under Peruvian legislation, reportable injuries include: accidental injuries resulting in lost-time, fatal accidents, accidents that require medical treatment or result in a loss of consciousness, an inability to perform all job duties on any workday after the injury or the temporary assignment or transfer to another job. Injuries involving first-aid only are not reportable as they are considered minor accidents.

The ~~safety~~following activities and ~~health of our employees is our highest priority. We believe that we have~~programs were implemented ~~robust safety measures and work continuously~~during 2015 in order to improve ~~our occupational health and~~ safety training and performance. We regularly monitor occupational health and safety performance and compliance through safety training programs, review and analysis of accident reports and other routine safety measures at our operating mines. Our Uchucchacua, Julcani, Antapite, Orcopampa and Shila-Paula mining units are Occupational Health and Safety Assessment Series 18001 certified.

~~Our safety program includes the following core components:~~management system:

~~Risk Detection Training and Log Book:~~a defensive driving course was taught to ~~train workers to detect, identify and record job-related hazards.~~hazardous materials truck drivers;

~~Safety Performance Indicators: to regularly monitor the performance of each operating unit~~a Corporate Crisis Committee Operating Plan was developed and ~~target safety efforts and training.~~

~~Specialized Safety Training: to provide training related to safety techniques and tools tailored to the risks associated with each employee’s job.~~distributed;

~~Mine School:~~a compliance program was developed to ~~provide on-site theoretical~~minimize accidents due to rock fall, ventilation and ~~practical training to employees in different fields of work.~~electric shocks;

~~Implementation of International~~a meeting with the Operations Vice President, the Business Development Vice President, Regional Operations Managers, Site Managers, Site Safety ~~Standards:~~Managers and Safety Directors was held in Lima in order to ~~establish~~improve visible leadership and ~~comply with internationally accepted~~further our safety ~~standards.~~system;

~~Safety Audits:~~our Operations Vice President and his team toured all sites to ~~regularly audit~~reinforce our safety ~~procedures and systems at each operating mine by certified auditors.~~policy;

During 2012, we experienced 117 total reportable injuries, 115 lost-time injuries and 2 fatal injuries, as compared to 105 total reportable injuries, 101 lost-time injuries and 4 fatal injuries for the year ended December 31, 2011. Under Peruvian law, the number of lost-time injuries recorded includes days away from work as a result of injury, restricted duty injuries and certain medical treatment injuries. The total number of reportable injuries includes lost-time injuries, as well as other minor and major first aid injuries and fatal injuries.

a score of 63% was achieved in the Annual General Safety Audit;

the Buenaventura Integrated System was re-certified by Bureau Veritas in ISO 9001, ISO 14001 and OSHAS 18001 standards;

~~C. Organizational Structure~~

the program “one production day without a lost time accident” became “five production days without a lost time accident,” reaching 50% effectiveness as we achieved 8 out of 16 weeks without a lost time accident; and

with respect to industrial hygiene, our positions were monitored to control physical, chemical, biological, ergonomic and psychosocial hazards.

Organizational Structure

As of March ~~31,2013,~~31, 2016, we conducted our mining operations, explorations projects and other activities directly and through various majority-owned subsidiaries, controlled companies and other ~~affiliated~~associate companies as described in the following organizational ~~chart.~~

chart:

†

All entities in this chart, with the exception of Minera Julcani S.A. de C.V. ~~and Compañía de Minas Buenaventura Chile Limitada~~ (which ~~are~~is organized in ~~Mexico and Chile, respectively)~~Mexico), are incorporated in Peru.

Compañía Minera Condesa S.A. ~~also~~ holds ~~21,222,236 treasury~~21,160,260 common shares of Compañía de Minas Buenaventura S.A.A., or approximately ~~7.68~~7.70 percent of our ~~outstanding equity.~~total common shares.

Intermediate Holding Companies, Subsidiaries and Equity Participations

Compañía Minera Condesa S.A.

Compañía Minera Condesa S.A., or “Condesa,” which is ~~wholly owned by us,~~our wholly-owned subsidiary, is a mining and facilities holding company with both direct and indirect ownership participation in ~~two mining-related entities, Cedimin and Yanacocha, and in exploration projects conducted by Minas Conga and Conenhua (as defined below). See “—B. Business Overview—Exploration.”~~Yanacocha. As a partner in Yanacocha, Condesa shares responsibility for the investments made in the Yanacocha mine. In addition, Condesa holds an equity interest in Chaupiloma, and, as a result, receives a portion of the royalty revenues paid by Yanacocha to Chaupiloma in an amount equal to ~~such~~its ownership interest. ~~See “—S.M.R.L. Chaupiloma Dos de Cajamarca” below.~~ Condesa also holds a ~~7.68 percent~~7.70% interest in us.

~~Compañía de Exploraciones, Desarrollo e Inversiones Mineras S.A.C.~~

Cedimin, wholly owned by us, is a mining and facilities holding company that operates the Shila-Paula mine and conducts explorations at the Tambomayo project. At our annual shareholders’ meeting on March 26, 2013, the shareholders approved the merger of Cedimin with and into Buenaventura, with Buenaventura as the surviving entity of the merger, and accordingly, in 2013, Cedimin will be merged with and into Buenaventura.

S.M.R.L. Chaupiloma Dos de Cajamarca

S.M.R.L. Chaupiloma Dos de Cajamarca, or ~~Chaupiloma,~~“Chaupiloma,” is a Peruvian limited liability company that holds all of the mining rights for the areas mined by ~~Yanacocha and Minas Conga.~~Yanacocha. Chaupiloma receives a royalty that is calculated as a percentage of the total revenues of Yanacocha. We own, directly and indirectly, through our interest in Condesa, a ~~60 percent~~60% interest in Chaupiloma. Newmont Peru owns the remaining ~~40 percent~~40% equity interest.

Consorcio Energético Huancavelica S.A. / Empresa de Generación Huanza S.A.

Consorcio Energético Huancavelica S.A., or ~~Conenhua,~~“Conenhua,” is an electrical transmission ~~and generation~~ company that provides a significant portion of our electrical needs through its transmission facilities. We own ~~100 percent~~100% of Conenhua and manage its operations. Conenhua obtained ~~the~~its concession for power transmission in the Huancavelica area in 1983 and subsequently obtained concessions in the Cajamarca and Arequipa regions, ~~enabling~~which enabled us ~~to buy energy from Electro Perú and~~ to transmit electric power to certain of our mining units and affiliates, ~~including Uchucchacua, Orcopampa, Poracota, Shila-Paula, Antapite, Yanacocha, La Zanja and Coimolache,~~ as well as to other mining companies and municipalities in the area, through our own facilities.

~~In order to~~To secure a reliable energy supply from a clean and renewable source for our direct operations and projects at competitive prices, Conenhua, through its subsidiary Empresa de Generación Huanza S.A., or ~~Huanza,~~“Huanza,” was commissioned to construct a 90.6 megawatt ~~or MW,~~(“MW”), capacity hydroelectric power plant in the valley of Santa Eulalia. ~~The construction of the 90.6 MW Huanza Hydroelectric Power Plant is~~This hydroelectrical plant began operating at full capacity in progress and should be completed by the end of the second quarter of 2013. This US$180-200 million project commenced in March 2010 and has been partially financed through a US$119 million finance lease obtained from Banco de Crédito del Peru.June 2014.

Buenaventura Ingenieros S.A.

Buenaventura Ingenieros S.A., or ~~BISA,~~“BISA,” one of our wholly-owned subsidiaries, has provided geological, engineering, design and construction consulting services to the mining sector for over 30 years. During this time, BISA has consulted in Peru, Chile, Argentina, Mexico and Ecuador on a range of projects, operations and expansions.

Contacto Corredores de Seguros S.A.

During 2015, Buenaventura paid US$8.8 million to BISA ~~owns a 99.99 percent interest~~ in order to obtain 99.98% ownership of Contacto Corredores de Seguros S.A., an insurance brokerage company that provides insurance brokerage and related services to us and our ~~affiliates.~~

~~Minera Julcani S.A. de C.V.~~affiliates

Minera Julcani S.A. de C.V.~~, or~~

Minera Julcani S.A. de C.V. is aone of our wholly-owned ~~subsidiary~~subsidiaries and was created for the purpose of conducting mining activities in Mexico. Currently, we are conducting exploration activities pursuant to ~~our joint venture~~an agreement with ~~Solitario México~~Surutato Mining, S.A. de C.V., or ~~Solitario.~~“Surutato.” Under this agreement, ~~Solitario~~Surutato granted us the exclusive right to conduct exploration activities within its ~~properties situated~~property located in ~~Hidalgo,~~Sinaloa, Mexico. ~~In January 2012, we terminated the agreement with Solitario.~~

~~Currently we are conducting due diligence on the Guadalupe project, an exploration property owned by First Mexican Gold Corp.~~

Inversiones Colquijirca S.A. / Sociedad Minera El Brocal S.A.A.

~~Sociedad Minera El Brocal S.A.A., or~~ El Brocal owns the Colquijirca and Marcapunta Norte ~~mines.~~mines and the San Gregorio exploration project. El Brocal was formed in 1956 and is engaged in the extraction, concentration and sale of concentrates of polymetallic minerals, mainly zinc, lead and silver. ~~On July 22, 2011,~~Currently, we completed the purchase of all of the outstanding equity of Inversiones Colquijirca S.A., which, in turn, owns 51.06 percent of El Brocal. As a result of this transaction, we increased our equity holdingown 56.29% of El Brocal ~~from 46.08 percent to a 53.76 percent controlling interest, including shares held directly by us~~through both direct and ~~indirectly through our wholly-owned subsidiary, Inversiones Colquijirca S.A.~~

~~Minera La Zanja S.R.L.~~indirect ownership interests.

Minera La Zanja S.R.L.~~, or~~

La Zanja ~~controls 32,070 hectares of mineralized ground in the La Zanja project, which~~ is located 35 kilometers northwest of the city of Cajamarca. La Zanja, which is currently ~~53.06 percent~~53.06% owned by us, ~~and 46.94 percent owned by Newmont Peru,~~ began operations in September 2010 as an open-pit mine producing gold and silver.

Compañía Minera Coimolache S.A.

~~Compañía Minera Coimolache S.A., or~~ Coimolache is a mining company that owns the Tantahuatay ~~project,~~mine which is located in the province and district of Hualgayoc in the Cajamarca region, which is 35 kilometers northwest of the Yanacocha mine. We ~~SCC and other third parties~~ hold a ~~40 percent interest, a 40 percent~~40.10% interest and ~~a 20 percent interest, respectively, in Coimolache. Construction of mining infrastructure at the Tantahuatay~~operate this mine, which commenced ~~in July 2010. Gold mining~~ operations ~~commenced~~ in mid-2011.

~~Canteras del Hallazgo S.A.C.~~

~~Canteras del Hallazgo S.A.C. holds mining rights to the Chucapaca project. We and Gold Fields hold a 49 percent interest and a 51 percent interest, respectively, inthis company.~~

Ferrovías Central Andino S.A.

We hold ~~10 percent~~10% of Ferrovías Central Andino S.A., ~~or Ferrovías,~~ a railroad company, pursuant to a concession granted to a consortium of several companies in April 2000. ~~Among the other companies holding interests in the share capital of Ferrovías are Railroad Development Corporation, Cemento Andino S.A., Commonwealth Development Corporation and others.~~ Ferrovías provides transportation for concentrates from El Brocal’s mining operations.

~~Sociedad Minera Cerro Verde S.A.A.~~Apu Coropuna S.R.L.

WeApu Coropuna S.R.L., is currently ~~hold~~ 70% owned by us and 30% owned by Southern Peru Copper Corporation. Apu Coropuna S.A. was created for the purpose of conducting exploration within properties situated in Castilla, Arequipa.

Compañía ~~19.58 percent interest~~de Minas Cerro Hablador S.A.C.

Compañía de Minas Cerro Hablador S.A.C., is our wholly-owned subsidiary created for the purpose of conducting exploration activities pursuant to our agreement with Corporación Aceros Arequipa S.A. Under this agreement, Corporación Aceros Arequipa S.A. granted us the exclusive right to conduct exploration activities within its properties situated in ~~Cerro~~Livitaca, Cusco.

Procesadora Industrial Rio Seco S.A.

Procesadora Industrial Rio Seco S.A. is our wholly-owned subsidiary that owns and operates a monohydrate manganese sulphate crystallization plant situated in Huaral, Lima. This processing plant will allow mining from areas with high silver and manganese content within the Uchucchacua mine, which will improve silver recovery.

El Molle Verde ~~which owns~~S.A.C.

El Molle Verde S.A.C. is our wholly-owned subsidiary that develops the ~~Cerro Verde copper deposit~~Trapiche project, located ~~approximately 1,100 kilometers southeast~~in the Apurimac region. See “Item 4. B. Business Overview–Exploration Projects in Non-Operating Areas” for further information of ~~Lima. For more detail, see “Item 5. Operating and Financial Review and Prospects—Buenaventura” and “Item 5. Operating and Financial Review and Prospects—Cerro Verde.”~~this project.

YANACOCHA

A. History and Development of the Company

Founded in Peru in 1992, Yanacocha is one of the largest gold ~~producer~~producers in South ~~America. Yanacocha~~America, having produced ~~1,345,992ounces~~917,691 ounces of gold in ~~2012.~~2015. Yanacocha’s operations are located in the Andes Mountains in Northern Peru in the ~~area~~region of Cajamarca, located approximately ~~900~~600 kilometers north of Lima and north of the city of Cajamarca at an altitude of 4,000 meters above sea level. The Yanacocha property consists of ~~six~~the following open-pit mines: ~~Carachugo,~~ Chaquicocha, Maqui Maqui, ~~San José~~Cerro Yanacocha, La Quinua Complex (La Quinua, El Tapado, El Tapado Oeste), Cerro ~~Yanacocha~~Negro Este, Western Oxide pits (La Quinua Sur and ~~La Quinua. As of December 31, 2012, the Chaquicocha,~~ Cerro ~~Yanacocha~~Negro Oeste), Eastern Oxide pits (Quecher Norte and ~~La Quinua mines were in operation.~~Marleny) and Carachugo Alto.

Yanacocha ~~continues to develop~~also owns the Conga project, which is located approximately 24 kilometers northeast of the Yanacocha operating mine in the provinces of Celendin, Cajamarca and Hualgayoc. ~~The project consists of two gold-copper porphyry deposits that are estimated to more than double Yanacocha’s proven and probable reserves. However, since the middle of 2012, the~~There was no exploration or development of new reserves because the Conga ~~has been based on a “water first” approach, which consists of building the originally planned community water reservoirs prior~~project's development and reserve balances reported in 2014 were reclassified to ~~resuming any mine development. At the end of 2012, the first of these reservoirs~~mineralized material in San Nicolás and associated roads were under construction. Activity relating to design and procurement continued throughout 2012 and will be completed in early 2013, with the majority of equipment having already been delivered to the Yanacocha mine site. Work to ensure the economic viability as well as the social acceptance of the project continues in parallel with the site reservoir construction activities.2015.

As of December 31, ~~2012,~~2015, Yanacocha’s proven and probable reserves (excluding the Conga ~~project’s proven and probable reserves)~~project, for which reserves were reclassified as resources or NRM as of December 31, 2015) were estimated to be ~~5.9~~5.1 million ounces of gold, representing a ~~23percent decrease~~4% increase over Yanacocha’s proven and probable reserves as of December 31, ~~2011,~~2014, which were estimated to be ~~7.7~~4.9 million ounces of gold. ~~As of December 31, 2012, the~~The Conga project’s ~~proven and probable~~ reserves are excluded because they were ~~estimated~~reclassified due to ~~be 12.6 million ounces~~the expiration of ~~gold and 3.3 billion pounds of copper, unchanged from~~ the estimated 2011 gold and copper reserves. As of December 31, 2012, Yanacocha’s total proven and probable reserves (including the Conga project) were estimated to be 18.5 million ounces of gold, representing a 9 percent decrease over Yanacocha’s total proven and probable reserves as of December 31, 2011, which were estimated to be 20.3 million ounces of gold. Yanacocha’s total proven and probable reserves of copper were 3.3 billion pounds as of December 31, 2012.current permit.

Proven and probable reserves are based on extensive drilling, sampling, mine modeling and metallurgical testing from which economic feasibility ~~has been~~is determined. Under the Management Contract (as defined below), Newmont Mining, in conjunction with Yanacocha, calculates Yanacocha’s reserves by methods generally applied within the mining industry and in accordance with SEC Industry Guide 7. Reserves represent estimated quantities of proven and probable ore that, under present and anticipated conditions, may be economically mined and processed.

In ~~2012,~~2015, Yanacocha produced ~~1,345,992~~917,691 ounces of gold, compared to ~~1,293,123~~969,944 ounces of gold produced in ~~2011.The increase~~2014. This decrease in gold production in ~~2012~~2015 as compared to ~~2011~~2014 was mainly attributable to~~higher production at the gold mill facility at Yanacocha, or theYanacocha Gold Mill, due to high ore grades from El Tapado pit~~.to:

lower gold mill production (0.51 million ounces of gold produced in 2015 as compared to 0.46 million ounces of gold produced in 2014) due to lower feed grade (3.265 grams per ton in 2015 as compared to 3.871 grams per ton in 2014), lower recovery (80.2% in 2014 as compared to 83.2% in 2014) and lower throughput (6.1 million tons in 2015 as compared to 6.3 million tons in 2014) by the deep transitional campaigns; and

higher leach pad production (0.41 million ounces produced in 2015 as compared to 0.33 million ounces produced in 2014) resulting from the inventory reduction campaign and increased ounce placement during the first half of 2015 (301,631 ounces in 2015 as compared to 142,946 ounces in 2014) due to increased ore mining at Yanacocha, Cerro Negro, La Quinua Sur and Tapado Oeste.

Silver production was ~~1,348,004~~574,110 ounces in ~~2011~~2014 and ~~553,092~~447,376 ounces in ~~2012.The~~2015. This decrease in silver production in ~~2012~~2015 as compared to ~~2011~~2014 was mainly attributable to beginning the deep transitional process with lower ~~ounces placed due to Yanacocha’s decision not to conduct~~recovery on silver ~~mining activities at~~in the ~~Yanacocha mine, which has high grade silver.~~gold mill.

~~Yanacocha is owned 51.35 percent by~~

Newmont Mining owns 51.35% of Yanacocha through its wholly-owned subsidiary Newmont ~~Second, 43.65 percent by us~~Second. We own 43.65% of Yanacocha through our wholly-owned subsidiary Condesa and ~~5 percent~~the remaining 5% is owned by IFC. Yanacocha is managed by Newmont Peru. See “—“ – Management of ~~Yanacocha—~~Yanacocha – General Manager/Management Agreement.” Although Yanacocha has no fixed dividend policy, there is an understanding among the partners that the net income not required for sustaining capital expenditures or future development projects should be distributed ~~after agreement between~~following approval by the two major shareholders of Yanacocha, Newmont Mining and us.

Capital Expenditures

Yanacocha’s capital expenditures from its formation in 1992 through ~~2012~~2015 have related principally to the construction of the Carachugo, Maqui Maqui, San José, Cerro Yanacocha and La Quinua mining operations, the construction of two plants at Carachugo and Yanacocha, each of which includes a leach solution processing facility and a smelter at each plant, the construction of four carbon column plants at Cerro Yanacocha and La Quinua, the acquisition of both new and used mining equipment, the construction of two dams, the construction of one agglomeration plant at La Quinua, the construction of the Yanacocha Gold Mill, and several expansions of the leach pads located at the Carachugo, Maqui Maqui, Cerro Yanacocha and La Quinua mining operations.Yanacocha’sto:

the construction of the Carachugo, Chaquicocha, Maqui Maqui, San José, Cerro Yanacocha, La Quinua Complex (La Quinua, El Tapado and Tapado Oeste), Cerro Negro Este, Western Oxide pits (La Quinua Sur and Cerro Negro Oeste), Eastern Oxide pits (Quecher Norte and Marleny) and Carachugo Alto mining operations;

the construction of two plants at Carachugo and Yanacocha, each of which includes a leach solution processing facility and a smelter;

the construction of the Yanacocha Gold Mill;

the construction of four carbon column plants at Cerro Yanacocha and La Quinua;

the acquisition of both new and used mining equipment;

the construction of two dams;

the construction of one agglomeration plant at La Quinua;

the expansion of storage at La Quinua Tailings;

the initial construction of a water treatment plant at La Quinua Tailings;

the construction of gold mill tailing pipeline and equipment components; and

several expansions of the leach pads located at the Carachugo, Maqui Maqui, Cerro Yanacocha, and La Quinua mining operations.

Yanacocha’s capital expenditures from its formation through December 31, ~~2012 totaled~~2015 amounted to approximately US$~~5,393~~527 million, including capital expenditures of US$~~1,094~~311 million in ~~2011~~2013, US$117 million in 2014 and US$~~1,148~~96 million in ~~2012.~~ 2015.

In ~~2012,~~2015, Yanacocha’s principal capital expenditures included US$498 million for engineering, construction and equipment at the Conga project, US$338 million for mine development at El Tapado Oeste, the Western Oxides and the Eastern Oxides deposits, US$30 million for equipment components, US$25 million for water treatment plant studies and construction, US$18 million for gold mill tailings improvements, US$17 million for bio-leach studies and plant construction and US$15 million for the standardization of information technology systems.included:

US$29 million associated with the initial construction of one water treatment plant at La Quinua;

US$28 million for the expansion of storage at La Quinua Tailings and the construction of the North Tailings Dump;

US$14 million for equipment components;

US$5 million for equipment upgrades in the Verde Bioleach Pilot Plant;

US$3 million for drilling activities in the Quecher project;

US$3 million for hydrogeological activities in the Western Oxides; and

US$17 million for other minor projects.

Yanacocha anticipates that its capital expenditures for ~~2013~~2016 will be approximately US$~~566~~79 million, of which it plans to use approximately US$~~300~~39 million for Yanacocha laybacks, US$24 million to continue with the construction of a water treatment plant at La Quinua, and US$4 million in connection with ~~the construction of the Conga project.~~improvements in a residual water treatment plant. The remaining capital expenditure budget has been allocated for investment in current ~~operations and development of future~~ operations. No capital will be employed at the Conga Project in 2016.

Yanacocha expects that it will meet its working capital, capital expenditure and exploration requirements for the next several years from internally-generated funds, cash on hand and financing from banks and financial ~~institutions.There~~institutions, if required. There can be no assurance that sufficient funding will be available to Yanacocha from internal or external sources to finance future working capital, capital expenditures and exploration and construction requirements, or that external funding will be available for such purposes on terms or at prices favorable to Yanacocha. A ~~very significant~~further decline in the price of gold would be reasonably likely to affect the availability of such sources of liquidity. See “Item 5. Operating and Financial Review and Prospects—Yanacocha—B. Liquidity and Capital Resources—Exploration Costs; Capital Expenditures.”

~~B. Business Overview~~

Business Overview

Description of Yanacocha’s Operations

The Yanacocha property consists of the following open-pit mines: ~~Carachugo,~~ Chaquicocha, Maqui Maqui, ~~San José,~~ Cerro Yanacocha, La Quinua Complex (La Quinua, El Tapado, Tapado Oeste), Cerro Negro Este, Western Oxide pits (La Quinua Sur and Cerro Negro Oeste), Eastern Oxide pits (Quecher Norte and Marleny) and Carachugo Alto.

Leach pads are located atCarachugo (410 million ton capacity), Maqui Maqui (70 million ton capacity), Cerro Yanacocha (470 million ton capacity) and La Quinua (640 million ton capacity, including the Western Oxides). Each of these leach pads includes at least two leach solution storage ponds and storm water ponds located down gradient from each leach pad. The Cerro Yanacocha site has two additional solution ponds for the segregation of solution generated from the treatment of transition ores. A raw water pond is used both for storm containment and to store excess solution during the wet season.

Yanacocha has four processing facilities: Pampa Larga, Yanacocha Norte, La Quinua and the Yanacocha Gold Mill. The processing facilities can be used to process gold-bearing solutions from any of the leach pads through a network of solution pumping facilities located adjacent to the solution storage ponds or, in the case of the Yanacocha Gold Mill, to process high-grade gold ore to produce a gold-bearing solution for treatment at the La Quinua processing plant. The Yanacocha Gold Mill commenced operations in March 2008, and its total annual production is between 5.5 and 6.0 million dry ~~metric tons, or DMT.~~tons. Production at the Yanacocha Gold Mill is expected to significantly impact Yanacocha’s future production capabilities, with total production measured in life-of-mine ounces at the Yanacocha Gold Mill representing 38~~percent~~38% of the total ounces produced by Yanacocha. ~~In order to~~To balance mining production and Yanacocha Gold Mill total production capacity, Yanacocha has established ore stockpiles in which it deposits most of the ore from the pits, and feeds a small portion directly to the plant. The Yanacocha Gold Mill sources mill ore from the Yanacocha, Chaquicocha, El Tapado and Tapado Oeste pits.

Mining consists of a sequence of drilling, blasting, loading and hauling. Ore containing gold is transported from each mine to the nearest active leach pad while waste is taken to specially designed storage facilities. Ore is then leached by introducing diluted solutions of cyanide through an irrigation system placed on top of the ore. This solution percolates through the ore, dissolving gold and silver as AuCN and AgCN complexes, ~~respectively,~~ and results in a “pregnant” solution which drains to solution storage ponds to be transferred to the nearest recovery facility. The end product is doré bars ~~currently assaying~~comprised of approximately ~~52 percent~~65-66% gold and ~~45 percent~~approximately 29% silver. The doré bars are transported from the processing plant by an outside security firm to be refined outside of Peru. See “—Transportation and Refining.” The solution from which the gold is removed (barren solution) is recycled to the leach pads for further heap-leaching after having been reconstituted with cyanide. The leaching process is generally a closed system. However, during periods of high rainfall, excess water must be treated at the facilities located at Yanacocha Norte and Pampa Larga, which have been designed to meet or exceed standards for drinking water and for agriculture and livestock as set out by the Peruvian Ministry of Health, the U.S. Environmental Protection Agency, the State of Nevada Regulations and World Bank guidelines. See “Regulation, Permit and Environmental Matters.”

~~Electric~~Since 1997, the energy and power supply for Yanacocha’s operations is currently provided by local power companies via two separate networks from the Cajamarca Norte substation in 60 kilovolts, or kV, and 220 kV, respectively. Yanacocha also maintains diesel generation capacity for emergency requirements, which have an aggregate power generation capacity of 33.75 MW. In addition, Yanacocha has been ~~connected to~~obtained from the Peruvian national electricity ~~grid since the end of 1997. Yanacocha currently receives its supply of electric power~~system through a 220 ~~kV power~~kilovolt (“kV”) transmission line ~~originating~~from the Trujillo-Norte substation in Trujillo ~~which~~to the Cajamarca-Norte substation in Cajamarca. This transmission line is owned by ~~Buenaventura~~Consorcio Energético Huancavelica–CONEHUA, and has a design capacity of approximately 150MW.

In August 2011, a new 220kV called Interandina line was brought online from Carhuamayo-Paracsha–Conococha-Kiman Ayllu (Huallanca) and connected to the Cajamarca-Norte substation. This line belongs to Abengoa and provides Yanacocha with energy and power, leaving the old transmission line with the energy flow to Trujillo.

Minera Yanacocha also has a 60kV double triad line and a 220kV simple triad line. Both are connected to Cajamarca-Norte Substation for the direct supply of its process plants.

Alternatively, in case of emergency, reduced supply or other event affecting the national electrical system, Yanacocha has its own power generators with a capacity of approximately 27MW. This system allows the Company to ~~provide up~~maintain the sustainability of its operation system and reduce its operational risks.

In connection with a bidding process carried out during 2014, the supply of energy and power for the period from 2015 to ~~150 MW~~2018 was awarded to ~~Yanacocha (although current contracted~~Duke Energy (Egenor), which is expected to achieve reductions in energy prices and result in savings of over US$25 million during the four-year term of the contract.

In 2015, Yanacocha’s power consumption was approximately 469 Giga Watt Hours at a cost of US$28.46 million. The maximum demand ~~is limited to 70 MW). In addition, a 60 kV power line routed through Cajamarca permits Yanacocha to receive up to 10 MW. This power line is used only~~was 63.3MW in ~~emergencies.~~ July 2015.See “Item 5. Operating and Financial Review and Prospects.”

Water for Yanacocha’s operations is collected from rainfall and wells. All excess water used by Yanacocha undergoes treatment at the facilities described above.

Set forth below are certain unaudited operating data for the years shown for each of Yanacocha’s mining operations that were then in operation:

2010 2011 2012
Mining Operations:
Ore mined (DST):
Cerro Yanacocha 28,817,797 1,434,279 1,244,162
Carachugo 23,455,796 31,494,122 26,270,839
Maqui Maqui 1,267 542,447 1,590,491
La Quinua 26,348,322 27,161,711 9,988,448
San José 5,090,528 3,556,183 692,086
Cerro Negro — 24,231 2,872,609
Total ore mined (DST) 83,713,710 64,212,973 42,658,634
Average gold grade of ore mined (oz./DST):
Cerro Yanacocha 0.032 0.011 0.052
Carachugo 0.028 0.034 0.032
Maqui Maqui 0.007 0.010 0.016
San José 0.016 0.019 0.017
La Quinua 0.019 0.030 0.052
Cerro Negro — 0.004 0.012
Total average gold grade of ore mined (oz./DST) 0.025 0.031 0.035

Gold production (oz.):
Cerro Yanacocha 659,080 659,996 141,038
Carachugo 344,698 274,723 690,503
Maqui Maqui 12,701 9,906 5,810
San José 54,570 45,271 8,117
La Quinua 390,571 303,226 488,320
Cerro Negro — — 12,204
Total gold (oz.) 1,461,620 1,293,123 1,345,992

	2013		2014		2015
Mining Operations:
Ore mined (DST):
Cerro Yanacocha		1,477,391		883,573		6,379,952
Carachugo		13,590,412		7,721,830		2,775,440
Maqui Maqui		2,467,205		619,755		1,490,496
La Quinua		21,098,589		27,414,341		17,312,927
San José		-		-		-
Cerro Negro		4,733,308		3,644,896		12,875,105
Total ore mined (DST)		43,366,905		40,281,395		40,833,920
Average gold grade of ore mined (oz./DST):
Cerro Yanacocha		0.016		0.019		0.010
Carachugo		0.035		0.031		0.031
Maqui Maqui		0.020		0.025		0.066
San José		-		-		-
La Quinua		0.031		0.043		0.037
Cerro Negro		0.015		0.024		0.018
Total average gold grade of ore mined (oz./DST)		0.029		0.038		0.027

Gold production (oz.):
Cerro Yanacocha		16,393		30,713		54,677
Carachugo		437,095		286,062		87,146
Maqui Maqui		5,856		5,669		67,195
San José		-		-		-
La Quinua		530,437		595,751		596,638
Cerro Negro		27,478		51,749		112,033
Total gold (oz.)		1,017,259		969,944		917,690

~~Exploration~~

Exploration

Yanacocha’s mining activities encompass ~~313,049~~219,533 hectares, which are covered by ~~439~~328 mining ~~concessions.~~concessions and applications. Of these ~~313,049~~219,533 hectares, Chaupiloma holds the mining rights related to ~~105,666~~102,803 hectares, which are covered by ~~144~~138 mining concessions. Yanacocha holds the mining rights related to 116,730 hectares underlying 190 concessions.

Chaupiloma has assigned these mining concessions to Yanacocha pursuant to several assignments of mining rights, each with an initial term of 20 years and one agreement with an extension of 17 years, which are renewable at Yanacocha’s request for an additional ~~20-year term.~~17, 20 or 30-year terms, as the case may be.

Yanacocha has ~~three~~four processing concessions from the MEM for its processing plants: Cerro Yanacocha (Yanacocha Gold Mill, Cerro Negro, La Quinua and Yanacocha), Yanacocha (Carachugo and Pampa Larga) and China ~~Linda.~~Linda (non-metallic). The processing concessions have indefinite terms, subject to the payment of an annual fee based on nominal capacity for the processing plant. ~~An additional~~These four processing ~~concession~~concessions include the Conga project, which is ~~pending~~in the process of being granted.

Advanced exploration and early-stage development expenditures for the ~~Conga project.~~Yanacocha District during 2015 totaled US$64.2 million as compared to US$8.9 million in 2014. Expenditures focused on oxide development and advanced exploration projects which included:

reserve and resource infill drilling on the Quecher Main deposit;

Exploration expenditures amounted to approximately US$24.0 million and US$40.0 million in 2011 and 2012, respectively. These expenditures have been used to identify deep sulfide mineralization beneath the oxide deposits at Tapado Oeste North,

reserve conversion infill drilling on the Los Pinos layback at Yanacocha Sur;

advanced exploration at the Marleny target;

development support on the Verde Bioleach Demonstration Facility; and

exploration drilling in the Antonio and Tapado deposits.

During 2016, Yanacocha Sur, La Quinua Sur and Cerro Negro, to reevaluate and advance the Chaquicocha Sulfides and Yanacocha Verde projects and to complete additional drilling designed to increase ore grade and resources and continue exploration in the Yanacocha district and surrounding areas. In 2013, exploration efforts willexpects focus on continuing ~~the development of the Chaquicocha Sulfides project, testing the extension of the Yanacocha Verde deposit, continuing~~ exploration activities in the Yanacocha district and conducting an exploration program in the Yanacocha concession block outside of ~~the operation district.~~its area of operations.

Yanacocha’s exploration expenditures include all of the costs associated with exploration activities such as drilling and geological and metallurgical testing. In addition, exploration costs cover engineering and project development costs on advanced stage projects. Yanacocha prepares a budget ~~for each year~~annually and allocates an amount for exploration activities based on specific projects or regions.

Yanacocha intends to continue ~~to develop the Cerro Yanacocha, La Quinua~~developing other oxide and ~~Chaquicocha gold deposit~~sulfide projects ~~and the Conga gold-copper deposit project~~ over the next several years, while continuing to explore the remainder of the Yanacocha district along with the adjacent ~~Minas Conga and~~ Solitario mineral holdings. The Conga project currently consists of two gold-copper porphyry ~~deposits that are estimated to more than double Yanacocha’s proven and probable reserves.~~deposits. The Conga project is located approximately 24 kilometers northeast of Yanacocha’s operating mine in the provinces of Celendin, Cajamarca and Hualgayoc. This project, incorporated into reserves beginning in 2004 and 2005, reported 12.6 million ounces of gold reserves and 3.3 billion pounds of copper reserves as of December 31, ~~2012.~~

Due to local political and community protests, construction and development activities at the Conga project were largely suspended in November 2011. The results of the Peruvian central government-initiated EIA independent review were announced on April 20, 2012 and confirmed that our initial EIA met Peruvian and international standards. The review made recommendations to provide additional water capacity and social funds, which Yanacocha has largely accepted. Yanacocha announced its decision to move the project forward on a “water first” approach on June 22, 2012. As a result, investment on the project will be reduced in 2013 to approximately US$250 million to US$300 million, and focus on building water reservoirs, completing the last engineering activities and accepting delivery of the main equipment purchases. Construction of Conga and the implementation of the independent EIA review recommendations will continue provided it can be done in a safe manner with risk-adjusted returns that justify future investment. Should Yanacocha be unable to continue with the current development plan at Conga, we or our mining partners in the project may reprioritize and reallocate capital to development alternatives which may result in a potential accounting impairment.2015.

For ~~2013,~~2016, Yanacocha estimates expenditures of US$~~19.8~~3.5 million for exploration, and an additional US$~~1.2~~4.41 million related to reserve delineation, characterization and sterilization activities for ore bodies that are currently classified as reserves. Both expenditure estimates are exclusive of significant development engineering charges. This budgeted amount will be expended mainly on oxide reserve conversion, extension drilling of known near-surface oxide inventories, sulfide exploration and early stage development atwithin the Yanacocha ~~and an extensive exploration program in district and regional properties that Yanacocha controls.~~district.

As of December 31, ~~2012,~~2015, the Yanacocha district’s proven and probable reserves (excluding the Conga project’s proven and probable reserves) were estimated to be ~~5.9~~5.1 million ounces of gold, a 234 percent ~~decreasefrom~~increase from the Yanacocha district’s proven and probable reserves as of December 31, ~~2011,~~2014, which were estimated to be ~~7.7~~4.9 million ounces of gold. ~~The decreasein reserves of gold was mainly due to mine depletion, and to a lesser extent, to reserve revisions and leach and stockpile inventory changes.~~

As of December 31, ~~2012, the Conga project’s~~2015, proven and probable gold reserves were ~~estimated to be 12.6 million ounces~~calculated using a gold price assumption of ~~gold and 3.3 billion pounds of copper, unchanged from the 2011 gold and copper reserves.~~US$1,200 per ounce.

Transportation and Refining

The doré bars produced by Yanacocha are transported to refineries outside of Peru and, ~~accordingly,~~as a result, Yanacocha has entered into pre-established transportation contracts. Yanacocha has engaged Hermes Transportes Blindados S.A., or ~~Hermes~~,“Hermes,” to service its local transportation requirements. Under the terms of Yanacocha’s agreement with Hermes, the risk of loss with respect to the doré bars is assumed in its entirety by Hermes during the transportation of the doré bars from the mines to Jorge Chávez Airport in Lima. Thereafter, the responsibility for the doré bars shifts to the refiner, which has entered into a contract with an outside security firm to provide offshore transportation. The doré bars are melted, weighed and sampled in refineries abroad, which store the doré bars in strong-room vaults and assume responsibility there for the doré bars. Yanacocha pays a predetermined fee for the refining service. The final output from refineries, known as London Good Delivery gold and silver, is credited to Yanacocha’s London bullion accounts until transferred to purchasers.

Sales of Gold

Yanacocha’s gold sales are made through a monthly open-bidding process in which Yanacocha auctions its production corresponding to the next four to five weeks. This bidding process is set up by Yanacocha with approximately 10 financial institutions and trading firms ~~prior to~~before each month. Yanacocha collects bids and confirms sales. The gold is typically sold on the date of departure from Jorge Chávez Airport in Lima. If a portion of gold remains unsold, it is sold on the spot market within a few days. Silver is sold on the spot market approximately once a month to financial institutions or trading firms. The cash from such sales is received into a collection account in London against orders to the London bullion bank for deliveries of the gold and silver to the purchasers.

Delivery is made once a week and payments are collected on the day of confirmation. The payment price for the gold consists of either (i) the market price at the confirmation of the sale, or (ii) the average London PM ~~Fixing~~fixing price over the tendered period plus a small premium established pursuant to the bidding process. Since 1994, Yanacocha has consistently sold to five or six financial institutions and trading firms at each auction. Such buyers are market makers and active participants in precious metal markets.

Employees

As of December 31, ~~2012,~~2015, Yanacocha had ~~2,647 employees.Compensation received~~1,745 employees.The compensation granted by ~~Yanacocha’s~~Yanacocha to its employees includes a base salary and other non-cash benefits such as a health program and ~~term~~ life insurance. ~~In addition, pursuant~~Additionally, according to the profit sharing plan ~~mandated~~required by Peruvian labor ~~legislation,~~laws, Yanacocha employees ~~at Yanacocha are entitled~~have the right to receive ~~8 percent~~8% of Yanacocha’s annual ~~pre-tax~~ profits ~~or the Employee Profit Sharing Amount, with 50~~before taxes. Fifty percent of ~~such~~these profits tomust be distributed ~~based on~~in proportion to the number of days each employee worked during the ~~preceding~~previous year, and the remaining ~~50 percent~~50% of such profits tomust be distributed ~~among the employees based on the aggregate~~according to each employee’s total annual ~~salary of each employee.~~salary.

Yanacocha has ~~entered into arrangements~~agreements with independent contractors that are responsible for the security services and staffing for ~~several operational and administrative areas.~~the execution of the Company’s projects in compliance with applicable legal regulations. As of December 31, ~~2012,~~2015, independent contractors ~~employed 9,790~~had hired 4,239 persons who ~~worked at Yanacocha’s operations.~~ were working in the Company’s operations, including the Conga Project.

In 2004, Yanacocha ~~entered into~~signed its first collective bargaining agreement with a union representing certain of its employees, which was created on December 9, 2003. In 2012, a new union was established. During 2013, direct collective bargaining agreements were signed with both unions for a three-year period (2013-2016). The Labor Relations Department ~~of Industrial Relations~~ meets ~~regularly~~ with union leaders on a monthly basis to address ~~labor problems~~various subjects and concerns in ~~the organization and~~order to promote the creation of a productive and harmonious ~~labor~~work environment. The parties ~~address~~resolve their ~~issues~~differences through open and transparent ~~dialogue.~~talks. In ~~2012, a new union was established, and in 2013, a new~~2016, we expect to begin negotiating an extension of the collective bargaining agreement with the two existing unions for the following period.

In order to strengthen the relations and communication process ~~will occur~~ with ~~both~~its employees, Yanacocha’s upper management held about four face-to-face meetings with important Yanacocha stake-holders, where they had the ~~new union~~opportunity to listen to the business plans and ~~existing unions.~~operating results, as well as to raise their concerns and make suggestions.

During 2015, key development programs have been implemented in order to increase technical, leadership and management skills based on talent management analysis process at all levels in our employee population. The total number of training hours in 2015 was 161,458. One program was the First Line Supervisor Program held for 216 individual collaborators and supervisors with the support of Adolfo Ibanez University. Additionally 43 managers and superintendents attended the “Talent Management during Change Environment” run by CEB Valtera.

Yanacocha offers its employees opportunities to collaborate, innovate and succeed in their careers. Its employee performance assessment system is associated with Yanacocha’s core values and measures its employees’ performance from a social responsibility, relationship management and leadership point of view. The work culture encompasses diversity, interacts with employees, encourages environmental and social responsibility, rewards outstanding performance and tries to develop great leaders at all levels.

Social Development

Since its ~~formation,~~creation, Yanacocha has ~~been attentive to social development and~~focused on its ~~relationships with local communities.~~

During 2012, Yanacocha invested a total of US$40.5 million for social development at various projects, including the Conga project and The Associaiton Los Andes of Cajamarca (ALAC), of which US$24.4 million was used for farming activities, promotion of community capabilities, education and public infrastructure. Additionally, Yanacocha invested US$16.1 million for social impact mitigation related to the implemention of social development projects, farming, construction of irrigation infrastructure, development of a former landowner families program and completion of pending commitmentsrelationship with the ~~surronding communitties.~~

~~In addition, Yanacocha also invested US$10.1 million~~community and actively participating in ~~contributions for social investment through the Cajamarca Mining Solidarity Fund in 2012.~~

its development. Since 1993, Yanacocha has invested ~~nearly~~ US$~~395.5~~444 million in social development programs including education, health, social infrastructure (schools and medical posts), productive infrastructure projects, rural electrification, roads, business promotion programs, local tourism programs and agricultural assistance programs.

Despite significant social investment, in recent years Yanacocha has experienced several conflicts that in some cases have affected the normal course of its operations. As a result of these conflicts, Yanacocha has increased its efforts to listen to and address the concerns and expectations of the local population.

To this end, in 2014 Yanacocha began implementing the legitimacy approach in its community engagement with a special emphasis on the following aspects: respect for Cajamarca, transparency and credibility, responsibility for water and environmental care and being a partner for development. Yanacocha believes this new engagement approach has been recognized by the community as a sign of positive change in Yanacocha.

During 2015, Yanacocha invested a total of US$5.25 million on social matters, US$4.61 million of which (including Conga Project and the Association Los Andes of Cajamarca - ALAC) were invested mainly in farming activities, the promotion of community capabilities, education and public infrastructure. Additionally, Yanacocha invested US$0.64 million in the mitigation of mining’s social impacts in its areas of operation and implemented agricultural and livestock projects, irrigation infrastructure, social development projects and the fulfillment of pending commitments with surrounding communities.

In addition, in 2015 Yanacocha invested US$2.38 million in contributions for social investment through the Cajamarca Mining Solidarity Fund. Also, Yanacocha has invested US$1.57 million on maintenance of the Kuntur Wasi road.

During 2016 Yanacocha will be focused on further improving its relationship with local communities and maximizing the value and recognition of its social investment to ensure the viability and legitimacy of its activities.

Security

Yanacocha has 5111 security employees on its payroll, including 7five employees responsible for the security of the region as a whole. In addition, Yanacocha has a contracted security force of over ~~221~~288 persons assigned to rotating shifts at its ~~mine,~~mines, its Lima offices and the city of ~~Cajamarca, checkpoints along the road to the coast of Peru and residential areas in~~ Cajamarca. The Conga project has a total of ~~130~~92 contracted security personnel responsible for patrolling and providing security to the project ~~including Yanacocha’s offices~~ in ~~the city of Cajamarca.~~rotating shifts.

~~As of March 31, 2013, none~~None of Yanacocha’s employees, ~~the~~ properties ~~on which it conducts mining operations~~ or ~~its Lima~~ headquarters ~~had been~~was the target of a terrorist ~~incident.~~incidents during 2015.

Mining and Processing Concessions

Yanacocha’s mining activities encompass 313,049 hectares covered by 439 mining concessions. Of these 313,049 hectares, Chaupiloma holds the mining rights related to 105,666 hectares, covered by 144 mining concessions. Chaupiloma has assigned these mining concessions to Yanacocha pursuant to several assignments of mining rights, each with an initial term of 20 years, which are renewable at Yanacocha’s request for an additional 20-year term. The rights to four additional concessions are currently pending, one of which relates to the Conga project.

Yanacocha believes that the mining concessions assigned to it are in full force and effect under applicable Peruvian laws and that it is in compliance with all material terms and requirements applicable to ~~the~~these mining concessions. To the best of its knowledge, Yanacocha is not ~~experiencing~~subject to any condition, occurrence or event ~~known to it~~ that would cause the revocation, cancellation, lapse, expiration or termination ~~thereof,~~of any of its concessions, except that Yanacocha and Chaupiloma may, from time to time, remake, cancel, terminate or allow to lapse mining concessions assigned to Yanacocha that are not material to the conduct of Yanacocha’s business.

Yanacocha has been actively pursuing the acquisition of the land surface rights or obtaining easements relating to land positions containing prospective geological exploration target sites, deposits that can be developed in the future or areas that would be considered for plant or facility sites. To date, Yanacocha has acquired all the surface rights with respect to ~~24,502~~24,685.32 hectares of the surface land covering its Carachugo, Chaquicocha, Maqui Maqui, Haussing, Laboratorio, Línea de Alta Tensión, Presas, ~~Museo,~~ Sorpresa Mishacocha, San José, Cerro Yanacocha, Las Lagunas, the Conga project, China Linda, ~~Amaru,~~Amaro, Chasu, Solitario, La Carpa, Canjes and La Quinua (which includes the Cerro Negro deposit) mining operations, and a majority of the Cerro Quilish deposit and Calera China Linda.

In addition, as of December 31, ~~2012,~~2015, Yanacocha had acquired ~~24,692~~24,685.32 hectares, including ~~5,804~~5,800.88 hectares of surface rights with respect to the Conga deposit, ~~3,589~~3,588.25 hectares for Carachugo/San José/Chaquicocha, ~~2,154~~2,153.84 hectares for Yanacocha and ~~1,651~~1,649.94 hectares for Quilish. During 2015, the Company did not acquire any hectares. See ~~“Yanacocha—~~“Yanacocha – A. History and Development of the Company.”

Regulation, Permit and Environmental Matters

Yanacocha is subject to a full range of governmental regulation and supervision generally applicable to companies engaged in business in Peru, including mining laws, labor laws, social security laws, public health, consumer protection laws, environmental laws, securities laws and antitrust laws. See ~~“—Buenaventura—~~“– Buenaventura – B. Business ~~Overview—~~Overview – Regulatory ~~Framework—~~Framework – Mining and Processing Concessions” and ~~“—Buenaventura—~~“– Buenaventura – B. Business ~~Overview—~~Overview – Regulatory ~~Framework—~~Framework – Environmental Matters” for a general description of Peruvian regulations of mining companies and environmental obligations. See “—Mining and Processing Concessions” above for a discussion of Peruvian regulations relating to the mining and processing concessions utilized by Yanacocha in its mining operations.

Yanacocha is required to submit ~~certain~~technical documentation with respect to its ~~plans~~mining and operations plans for the review and approval of various Peruvian government entities, including the MEM, the Ministry of Agriculture, the National and the Local Water ~~National Authority,~~Authorities, and the Ministry of Health. Yanacocha is required to file and obtain approval of an EIS with a Benefit Concession and Mining Permit for each of its mining operations before being authorized to ~~operate such mine. EISs~~operate. The EIS for the Carachugo, Maqui Maqui, San José, Cerro Yanacocha, La Quinua (including Cerro Negro) mining operations and China Linda lime plant have been reviewed and approved. Pursuant to current Peruvian regulations, Yanacocha also submits supplemental EISs each time a project’s production rate or disturbed area used is ~~expanded by more than 50 percent.~~expanded. In 2006, Yanacocha filed an EIS modification to expand its operations at Yanacocha with the Supplemental Environmental Impact Assessment East (“SYE”) and in the vicinity of La Quinua with the Supplemental Environmental Impact Assessment West (“SYO”). Since 2006, two additional modifications have been submitted and approved for the original supplemental SYE EIS and one additional modification has been submitted and approved for the original supplemental SYO EIS.

The improved permit application processing times by most of the regulatory authorities observed since the third quarter of 2013 continued into 2015. A total of 31 permits of different types were approved at Yanacocha and ~~La Quinua areas. After an~~another four permits, mainly related to environmental controls, were approved for the Conga project. The approvals of greatest significance in 2015 were a group of several minor modifications to the existing EIS pursued throughInformes Técnicos Sustentatorios (“ITS”) for the components of Marleny Open Pit, Bioleaching Plant, China Linda and Water Treatement Plant LQ. The Beneficiation Concession Permits that were approved included the ~~Benefit Concession Permit are approved and~~ construction ~~activities are initiated, a governmental-accredited environmental auditing firm is required to audit the operation. Each~~ of the ~~Carachugo,~~north TSF phase 1 LQ, the construction of Water Treatment Plant LQ and operation of 10 hectares of the leach pad 8A LQ. ITS for exploration of the projects of Yanacocha, San Jose 2 and Maqui Maqui ~~San José, Cerro Yanacocha, La Quinua (including Cerro Negro) mining operations and China Linda lime plant has been and continues to be audited as required with no pollution problems identified.~~were also approved, the latter includes the Chaquiocha underground project, whose modification involved the relocation of the entrance portal.

Yanacocha’s corporate policy is tooperate in compliance with all applicable laws and regulations and adopt and adhere to standards that are protective of both human health and the environment at the facilities it builds and operates.

Yanacocha has informed us that its management believes that its operations are conducted in accordance with applicable laws and regulations. Audits and corrective action plans are used to assure compliance. Future exploration, expansion and new projects will require a variety of permits. ~~Although procedures~~

On December 20, 2015, the Ministry of Environment issued a regulation that modifies the ECA and extends the deadline for ~~permit applications and approvals have been historically faster in Peru than in~~compliance. The new regulation provides 60 days to notify the ~~United States, current procedures and~~authority whether the ~~existing regulatory environment are more complex, time-consuming and susceptible to potential delays.~~

~~Yanacocha has informed us that as a result of the enactment of the new Water Resources Law and the new Rule for Exploration Activities~~,~~new environmental quality standards for water and new maximum permissible limits~~company will require the adoption of new technologies for the adjustment of water treatment and management systems. In 2010, Yanacocha implemented a Water Management Project to improve its treatment system and water management in orderbe able to comply with the new ~~water regulations.~~ECA, and a year to prepare and submit a modification of EIA – Plan Integral and a total of four years for the implementation phase.

During 2005, Yanacocha became a signatory to the International Cyanide Management Code, which provides specific and strict standards on how to manage cyanide. The required audit process was completed in September 2007 and certification under the International Cyanide Management Code occurred during April 2008. Yanacocha commissioned and successfully completed recertification audits to maintain International Cyanide Code Certification. Another Cyanide Code recertification audit was conducted in 2014 and, after having addressed the recommendations accordingly, Yanacocha was re-certified in February 2015. The Yanacocha environmental laboratory was recertified under ISO 17025 in 2015.

Yanacocha has informed us that its management believes that it is in compliance with all applicable regulations and international standards concerning safety. For the year ended December 31, ~~2012,~~2015, Yanacocha experienced ~~119~~five lost time injuries, ~~compared to 67 during~~ the ~~year ended December 31, 2011.~~same number of lost time injuries it experienced in 2014.

Insurance

Yanacocha maintains a comprehensive insurance program designed to address the specific risks associated with its operations, in addition to covering the normal insured risks encountered by major mining companies.

Yanacocha’s insurance program consists of a “Primary Program” and an “Umbrella/Excess Program.” Coverage under the Primary Program is provided through the local Peruvian insurance market and includes employers’ liability, comprehensive third party general liability, comprehensive automobile liability, and all risk property on a replacement basis, including transit risks, business interruption insurance and mining equipment. Coverage under the Umbrella/Excess Program is provided through Newmont Mining’s master worldwide insurance program and addresses claims that the Primary Program cannot, or will not, cover. ~~Yanacocha received an additional US$14.4 million settlement in 2008 from its insurance program in connection with a mercury spill.~~

By-Laws of Yanacocha

Yanacocha is governed by the Peruvian Companies Law and theestatutos (the combined articles of incorporation and by-laws) of Yanacocha, or the ~~Yanacocha~~“Yanacocha By-Laws.”

Control Over Major Corporate Events

Pursuant to the Peruvian Companies Law and the Yanacocha By-Laws (including applicable quorum requirements), without the affirmative vote of the partners of Yanacocha representing at least ~~51 percent~~51% of the voting shares, none of the following may occur: (i) an increase or decrease in Yanacocha’s capital, (ii) the issuance of any debentures, (iii) any sale of an asset whose book value is at least 50 percent of the paid-in capital relating to such asset, (iv) any amendment to the Yanacocha By-Laws in order to change its business form, (v) the merger, consolidation, dissolution or liquidation of Yanacocha or (vi) any other amendment of the Yanacocha By-Laws.

an increase or decrease in Yanacocha’s capital;

the issuance of any debentures;

any sale of an asset whose book value is at least 50% of the paid-in capital relating to such asset;

any amendment to the Yanacocha By-Laws to change its business form;

the merger, consolidation, dissolution or liquidation of Yanacocha; or

any other amendment of the Yanacocha By-Laws.

Pursuant to the Shareholders Agreement among Newmont Second, Condesa,Compagnie Miniére Internationale Or S.A.and IFC, dated as of August 16, 1993, as amended by a General Amendment Letter, dated August 17, 1994, any member of the Executive Committee of Yanacocha who wishes to propose that Yanacocha’s Executive Committee authorize Yanacocha to take a Significant Action (as defined below) must (i) give written notice to each partner of such proposal ~~prior to~~before consideration thereof at a meeting of the Executive Committee and (ii) refrain from voting to approve such Significant Action until (x) the Executive Committee has received the consent of ~~80 percent~~80% of the partners of Yanacocha (a partner is deemed to have consented if no objection is received from such partner within 30 days after being notified) or (y) the Executive Committee has received the consent of at least ~~51 percent~~51% of the partners of Yanacocha and 45 days have elapsed since the member of the Executive Committee who proposed the Significant Action has responded in writing to objections received from objecting partners. “Significant Action” means (i) a disposal or sale of more than 20 percent by value of Yanacocha’s fixed assets, (ii) any planned shutdown or cessation of Yanacocha’s mining activities that is planned to last for more than one year, (iii) any capital expenditure by Yanacocha exceeding US$20 million, (iv) any disposal or sale by Yanacocha of the mining rights covered by certain concessions or (v) the approval of the construction of a project in the area owned by Yanacocha (other than the Carachugo mine and processing facilities).means:

a disposal or sale of more than 20% by value of Yanacocha’s fixed assets;

any planned shutdown or cessation of Yanacocha’s mining activities that is planned to last for more than one year;

any capital expenditure by Yanacocha exceeding US$20 million;

any disposal or sale by Yanacocha of the mining rights covered by certain concessions; or

the approval of the construction of a project in the area owned by Yanacocha (other than the Carachugo mine and processing facilities).

Preemptive Rights

The Peruvian Companies Law and the Yanacocha By-Laws provide preemptive rights to all partners of Yanacocha. In the event of a capital increase, any partner has a preemptive right to pay its pro rata share of such increase ~~in order~~ to maintain such partner’s existing participation in Yanacocha.

In the event of a proposed transfer, exchange or sale, either voluntary or involuntary, of participation, collectively referred to as the ~~Offered~~“Offered Participation,” of one or more partners, any partner has a right to acquire the Offered Participation in proportion to its holdings of partners’ capital. InIf the ~~event that not all of the partners wish~~entire partnership fails to exercise this right or some partners indicate their decision to acquire a smaller share than that to which they are entitled, the other partners will ~~be entitled to~~receive an increase, and consequently, the remaining participation will be distributed among them in proportion to such partners’ capital participation and within the maximum limit of the participation they have stated their intention to acquire. Finally, any Offered Participation remaining unsubscribed by the partners must first be offered to Yanacocha before they may be offered to third parties.

In addition, in the event of the occurrence of a change of control (as defined) with respect to a significant partner, or the parent of a significant partner, in Yanacocha, the other significant partner will have the right to acquire the first partner’s participation interest in Yanacocha. No change of control will occur with respect to a significant partner so long as the parent of such partner is publicly traded or if such partner’s parent is acquired, the acquiring company is publicly traded.

Legal Proceedings

For a discussion of legal proceedings, see Note 1920 to the Yanacocha Financial Statements.

Other than the legal proceedings described in the Yanacocha Financial Statements, Yanacocha is also involved in certain legal proceedings arising in the normal course of its business, none of which individually or in the aggregate is material to Yanacocha or its operations.

Management of Yanacocha

Executive Committee

Pursuant to the Yanacocha By-Laws, Yanacocha’s Executive Committee consists of six members, all of whom are appointed by the partners of Yanacocha. ~~Richard T. O’Brien,~~Gary J. Goldberg, President and Chief Executive Officer of Newmont Mining Corporation, has been appointed Chairman of Yanacocha’s Executive Committee, and ~~Alberto~~Roque Benavides, our ~~former Chairman,~~President and Chief Executive Officer, serves as the Vice Chairman of Yanacocha’s Executive ~~Committee through 2013.~~Committee. The Vice Chairman has the power to preside over the meetings of Yanacocha’s Executive Committee in the Chairman’s absence. The members of the Executive Committee are elected for a three-year term but may continue in their positions until the next election takes place and the newly elected members accept their positions. Alternate members are elected in the same manner as members and can act in place of and with all the authority of members when a member is unavailable, except that an alternate member may not ~~act as either Chairman or Vice Chairman~~preside over the meetings of Yanacocha’s Executive Committee. The Chairman has the right to cast the deciding vote in the event of a deadlock among Yanacocha’s Executive Committee.

General Manager/Management Agreement

The Yanacocha By-Laws provide that the Yanacocha Partners’ Meeting has the power to appoint and remove the Manager of Yanacocha; the Executive Committee has the power to appoint and remove other officers of Yanacocha, determine their duties and compensation and grant and revoke powers of attorney. Newmont Peru was named as Yanacocha’s Manager according to a publicly filed deed, and it continues to hold that position. Newmont Peru’s duties as Manager are defined in the Management Contract dated February 28, 1992, as amended, between Yanacocha and Newmont Peru. Pursuant to the Management Contract, Newmont Peru is responsible for managing, conducting and controlling the day-to-day operations of Yanacocha and keeping Yanacocha’s Executive Committee informed of all operations through the delivery of various written reports. The Management Contract was amended as of December 19, 2000. The amendment extends the term of the Management Contract for a period of 20 years starting at the date of amendment and provides that it may be extended for additional terms of 20 years upon request by Newmont Peru. Newmont Peru, however, may cancel the Management Contract by giving six months’ prior notice to Yanacocha. The Management Contract will be deemed terminated if, due to reasons attributable to the bad management of Yanacocha, except for reasons beyond its control, Newmont Peru is unable to substantially complete the agreed work programs. In exchange for its services as Manager, Newmont Peru receives remuneration of US$2 per ounce of gold production and its equivalent for copper production paid on a quarterly basis, which amount is expected to cover the overhead and administrative expenses for the management of the operations. Also, Newmont Peru may charge Yanacocha for the salaries of employees of Newmont Peru or its affiliates who are directly involved in the operation of Yanacocha. In ~~2012,~~2015, Yanacocha accrued fees of US$8813.3 million owed to Newmont Peru and its affiliates under the Management Contract.

Control Over Major Corporate Events

See “—By-Laws of Yanacocha” above for a description of certain provisions of Peruvian law and of the Yanacocha By-Laws relating to control over major corporate events.

Preemptive Rights and Rights of First Refusal

See “—By-Laws of Yanacocha” above for a description of certain provisions of Peruvian law and of the Yanacocha By-Laws relating to preemptive rights and rights of first refusal.

D.~~Property, Plants and Equipment~~

Property, Plants and Equipment

Our Properties

Introduction

We ~~operate ten mines:~~currently have five wholly-owned operating mines (Orcopampa, Uchucchacua, Julcani, ~~Recuperada, Uchucchacua, Orcopampa, Poracota,~~ Mallay ~~Breapampa, Antapite, Ishihuinca~~ and ~~Shila-Paula. We also have~~Breapampa) and controlling interests in two mining companies which operate the ~~Colquijirca, Marcapunta~~Colquijirca-Marcapunta and La Zanja mines. We also own an electric power transmission company, ~~and~~an energy generation company, a chemical processing company, an engineering services consulting company and an insurance brokerage company. We also have non-controlling interests in ~~several other mining companies, including a significant ownership interest in companies that own and operate the~~ Yanacocha, Cerro Verde and Tantahuatay mines.See “—Buenaventura—C. Organizational Structure” and ~~“—Intermediate~~“Intermediate Holding Companies, Subsidiaries and Equity Participations.” Set forth below is a map of our principal mining ~~operations as of April 30, 2013.~~operations.

~~Operating~~Directly Operated Properties

Orcopampa

The Orcopampa mine is ~~wholly owned~~wholly-owned and operated by us. We lease the rights to the mining concessions of Orcopampa from a group of private investors. This lease, which expires in 2043, requires a payment from us equal to ~~10 percent~~10% of production value, subject to certain conditions. Operations started in the Orcopampa mine in 1965. In ~~2012,~~2015, we made lease payments of US$~~38.39million. We~~21.9 million.We operated Orcopampa as a silver mine until the late 1990s, when we also began to mine gold-bearing veins. ~~At December 31, 2012, the net total fixed assets of Orcopampa were approximately US$60.3 million.~~

The Orcopampa mine is located in the province of Castilla, department of Arequipa, approximately 1,350 kilometers southeast of the city of Lima, at an altitude of between 3,800 and 4,500 meters above sea level. ~~Access is by a 192-kilometer unpaved public road, which connects to the Pan American highway, and by airstrip.~~

The Orcopampa ~~mining property~~mine consists of an epithermal gold telluride deposit, hosted ~~by early Miocene to Holocene calc-alkaline to high potassium calc-alkaline~~into lava flows and domes of ~~the~~ Sarpane ~~Complex,~~complex (calc-alkaline to high potassium), of early Miocene to Holocene, which forms part of the tertiary metallogenic ~~(Au-Ag)~~ belt of Southern ~~Peru.~~Peru (Au-Ag).

Mining at Orcopampa is conducted underground using the mechanized cut-and-fill method. ~~Ore~~Mine ore is processed atby the Carbon in Leach method in a ~~mill~~plant located ~~at Orcopampa.~~in Orcopampa, which was also outfitted for the treatment of old tailings. Electric power is ~~generated and supplied by a 3,900 kW hydroelectric plant that is owned by us and a power line, which is connected to~~primarily obtained from the Peruvian national electricity grid. Water for operations at Orcopampa is obtained from a lake and ~~three~~ rivers. When water is scarce, electric power for the Orcopampa mine can be provided by a 3,976 kW diesel generator. In 2012, we completed construction of a new tailing dam to extend the life of this mine. The 4A tailing dam has a capacity of 2.5 million cubic meters and is expected to be operational until 2016.

~~During 2012, we focused our~~

In 2015, geological exploration ~~below~~activities were continued on the ~~3,440-meter level~~Lucía – Julissa veins system, extension east of Prometida Ramal 1 in the Prometida mine and on the Nazareno ~~Esperanza, Prosperidad, Lucia Angela~~veins system, which includes Nazareno Este, Pucará Sur, Denisse and ~~Concepción veins and below the 3,540-meter level on the Natividad-Ocoruro vein system. We completed 13,283 meters of underground mining exploration works and 33,630 meters of diamond dri~~lling. We also deepened the Nazareno and Prometida shafts, which will improve our exploration of the lower levels of the Chipmo mine. In 2013, we plan to continue exploration of the lower levels of the Chipmo mine. We also plan to explore the southeast extension of mineralized structures at Pucay and Natividad-Ocoruro at the 3,540-meter level through underground tunnel development and diamond drilling.Oliva.

As of December 31, ~~2012, we calculated~~2015, proven and probable ore reserves ~~of 673,722 DST,~~totaled 648,353 tons, with ~~0.53 ounces~~51.32 grams per ton of silver and 0.43 ounces per ton of gold, and probable ore reserves of 417,169 DST, with 0.56 ounces per ton of silver and 0.40 ounces per ton of gold. We have estimated NRM of 420,030 DST, with 5.05 ounces per ton of silver and 0.435 ounces14.78 grams per ton of gold.

Set forth below are certain unaudited operating data for the periods shown for Orcopampa, calculated on the basis of ~~100 percent~~100% of the mine’s production.

	Year Ended December 31,^{(1) (2)}						Year Ended December 31,⁽¹⁾
	2010		2011		2012		2014		2015
Mining Operations:
Ore mined (ST)		484,767		499,732		508,647
Average gold grade (oz./ST)		0.625		0.551		0.492
Average silver grade (oz./ST)		0.30		0.40		0.43
Ore mined (t)								454,694		458,222
Average gold grade (g/t)								14.15		14.32
Average silver grade (g/t)								56.26		69.86
Production:
Gold (oz.)		319,694		285,200		260,379		203,226		204,629
Silver (oz.)		104,400		320,964		425,620		430,494		562,795
Recovery rate (gold) (%)⁽³⁾		95.9		94.8		95.9		97.72		95.30
Recovery rate (silver) (%)⁽³⁾		53.5		54.3		50.5		51.44		53.64
Cost applicable to sales per oz. of gold⁽²⁾							US$	777	US$	680
Cost applicable to sales per oz. of silver⁽²⁾							US$	11.29	US$	8.85

(1)

Incorporates losses for mining dilution and recovery.

(2)

~~Incorporates gold~~Cost applicable to sales per unit of mineral sold is not a measure of financial performance under IFRS and ~~silver production from final tail treatment. During 2012, 20,245 ounces~~may not be comparable to similarly titled measures of other companies. Cost applicable to sales per ounce of gold ~~and 314,574 ounces~~or ounce of silver ~~were recovered.~~

~~(3)~~

~~Only reflects recovery rate~~consists of cost applicable to sales for gold or silver sold, divided by the volume of gold or silver produced in the specified period. The cost applicable to sales per unit of mineral sold figures disclosed herein are calculated without adjusting for by-product revenue amounts. We consider cost applicable to sales per unit of mineral to be a key measure in managing and ~~silver from Chipmo ore.~~evaluating our operating performance. We believe this measure is widely reported in the precious metals industry as a benchmark for performance, but does not have standardized meanings. You should not consider cost applicable to sales per unit of mineral sold as an alternative to cost of sales determined in accordance with IFRS as an indicator of our operating performance. See “Item 5. Operating and Financial Review Prospects—Buenaventura—F. Reconciliation of Cost Applicable to Sales and Cost Applicable to Sales per Unit Sold” for a reconciliation of Cost applicable to sales per unit sold to Cost of sales, excluding depreciation and amortization.

~~Poracota~~Uchucchacua

Poracota is an underground mine that is wholly owned and operated by us. Poracota is located in the province of Condesuyos, department of Arequipa, at an altitude of between 4,500 and 5,000 meters above sea level. Access to the mine is available by means of a 33-kilometer unpaved road connected to the Orcopampa mine. Operations at our Poracota mine commenced in February 2007. As of December 31, 2012, Poracota’s net total fixed assets were approximately US$2.4 million.

Gold mineralization at Poracota has been classified as an epithermal high sulfidation system, which is formed by two main areas, Huamanihuayta and Perseverancia. The more important veins are María Fé, Silvana, Rocio and Malena, which are hosted by the tertiary rocks of the Huamanihuayta volcano.

~~Ore from the Poracota mine is treated by flotation at the Orcopampa concentrator plant.~~

During 2012, we conducted 9,554 meters of underground exploration tunnels and 34,361 meters of diamond drilling. In 2013, we plan to continue our exploration efforts in Huamanihuayta Oeste and evaluate three new structures, Juliana, Milagros and Marely, as well as the southwest extension of the Malena, Silvana and Paoloa veins.

As of December 31, 2012, we calculated Poracota’s proven reserves of 29,741 DST, with 0.332 ounces per ton of gold and 0.096 ounces per ton of silver, and probable reserves of 6,746 DST, with 0.330 ounces per ton of gold and 0.004 ounces per ton of silver. The NRM for sulfides and oxides was 29,212 DST, with 0.386 ounces per ton of gold and 4,093,924 DST, with 0.037 ounces per ton of gold, respectively.

~~Set forth below are certain unaudited operating data for the periods shown for Poracota, calculated on the basis of 100 percent of the mine’s production.~~

Year Ended December 31,
2010 2011 2012
Mining Operations:
Ore mined (ST) 245,041 260,475 134,886
Average gold grade (oz./ST) 0.290 0.236 0.183
Average silver grade (oz./ST) 0.15 0.23 0.180
Production:
Gold (oz.) 59,803 49,201 19,238
Silver (oz.) 27,169 43,092 16,181
Recovery rate (gold) (%) 84.2 81.8 77.8
Recovery rate (silver) (%) 73.8 74.6 67.4

~~Uchucchacua~~

The Uchucchacua mine is ~~wholly owned~~wholly-owned and operated by us. Operations ~~started~~began in 1975, and Uchucchacua is currently our largest producer of silver. Uchucchacua is located in the province of Oyón, department of Lima, approximately 265 kilometers northeast of the city of Lima at an altitude of between 4,000 and 5,000 meters above sea level. ~~At December 31, 2012, the net total fixed assets of Uchucchacua were approximately US$55.1 million.~~

Uchucchacua’s mineral structures are hosted by Mesozoic limestone of the Jumasha Formation and are classified as a mesothermal polymetallic deposit of silver-lead-zinc with important contents of manganese. The main mineralized structures are veins and ore bodies with high-grade silver ~~mineralization.~~content.

Mining at Uchucchacua is conducted underground utilizing cut-and-fill stopping, shrinkage stopping, and sublevel stopping methods. Ore is processed at a mill located at Uchucchacua. The mill has a rated capacity of ~~3,000 DST~~3,800 tons per day and utilizes differential flotation to obtain a lead-silver concentrate and a zinc concentrate. Electric power is ~~generated by~~obtained from the Peruvian national electricity grid, a ~~3,400 kW~~ hydroelectric plant ~~that we own~~ and by a ~~3,025 kW~~ diesel generator. We utilize a power line connecting Uchucchacua to the Peruvian national electricity grid and have electrical distribution facilities within the Uchucchacua mine. Water for operations at Uchucchacua is obtained from three lakes.

In ~~2012,~~December 2013, we ~~continued~~completed construction of a manganese sulfate plant Rio Seco, located ~~in Sayan, Lima which will treat Uchucchacua’s mine concentrate, improve silver recovery and increase~~102 kilometers north of Lima. In January 2014, operations began with the ~~average realized price for~~treatment of manganese – silver concentrates ~~produced at this~~from the Uchucchacua mine.During 2015, 24,065 tons were treated, with 144.7ounces per ton of silver, 7.1%lead, 25.4%manganese, and following treatment 15,319 tons were obtained, with 225.0 ounces per ton of silver, 10.9% lead and 4.2%manganese. This process also allowed for the production of 14,935 tons of sulfuric acid of 98.0 percent purity and 12,880 tons of commercial grade manganese sulfate monohydrate.

During 2015, the main exploration focused on the Socorro mine. We ~~will begin opearating~~also explored the ~~manganese sulfate plant in May 2013.~~

~~In 2012, we conducted exploration efforts on three mines: Socorro,~~Huantajalla mine, Carmen mine and Huantajalla. We completed 52,494 meters of diamond drilling and constructed 23,236 meters of underground exploration tunnels. During 2013, we plan to focus our exploration efforts mainly on Huantajalla and Socorroto to incease our reservesCasualidad mine with relative success, finding narrow structures with high ~~grades~~contents of ~~silver-maganese.~~silver.

At December 31, ~~2012,~~2015, proven ~~ore reserves were 3,498,580 DST, with 12.6 ounces per ton of silver, 1.21 percent lead and 1.77 percent zinc,~~ and probable ore reserves were ~~2,186,410 DST,~~4,271,220 tons, with ~~12.8 ounces of silver per ton, 1.32 percent lead and 1.78 percent zinc. Total NRM was 3,815,346 DST, with 13.2 ounces~~444.95 grams per ton of silver, ~~1.66 percent~~1.30% lead and ~~2.20 percent~~1.80% zinc.

Set forth below are certain unaudited operating data for the periods shown for Uchucchacua, calculated on the basis of ~~100 percent~~100% of the mine’s production.

	Year Ended December 31,⁽¹⁾						Year Ended December 31,⁽¹⁾
	2010		2011⁽²⁾		2012⁽²⁾		2014		2015
Mining Operations:
Ore mined (ST)		1,013,395		1,086,124		1,156,656
Average silver grade (oz./ST)		12.93		13.04		13.00
Ore mined (t)								1,013,633		1,121,474
Average silver grade (g/t)								452.87		460.33
Average zinc grade (%)		1.47		1.31		1.51		1.04		1.05
Average lead grade (%)		0.98		0.89		1.02		0.81		0.82
Production:
Silver (oz.)		9,269,718		10,090,337		11,263,322		12,055,570		13,919,922
Zinc (ST)		7,702		7,351		10,824
Lead (ST)		8,687		8,319		9,636
Zinc (t)								6,349		5,693
Lead (t)								7,605		7,947
Recovery rate (silver) (%)		70.7		71.20		74.88		81.67		83.87
Cost applicable to sales per oz. of silver⁽²⁾							US$	16.34	US$	13.97
Cost applicable to sales per ton of zinc⁽²⁾							US$	2,478	US$	2,430
Cost applicable to sales per ton of lead⁽²⁾							US$	1,843	US$	1,551

(1)

Incorporates losses for mining dilution and recovery.

(2)

~~Incorporates total Socorro, Carmen~~Cost applicable to sales per unit of mineral sold is not a measure of financial performance under IFRS and ~~Huantajalla mine production.~~may not be comparable to similarly titled measures of other companies. Cost applicable to sales per ounce of silver, ton of zinc or ton of lead consists of cost applicable to sales for silver, zinc or lead sold, divided by the volume of silver, zinc or lead produced in the specified period. The cost applicable to sales per unit of mineral sold figures disclosed herein are calculated without adjusting for by-product revenue amounts. We consider cost applicable to sales per unit of mineral to be a key measure in managing and evaluating our operating performance. We believe this measure is widely reported in the precious metals industry as a benchmark for performance, but does not have standardized meanings. You should not consider cost applicable to sales per unit of mineral sold as an alternative to cost of sales determined in accordance with IFRS as an indicator of our operating performance. See “Item 5. Operating and Financial Review Prospects—Buenaventura—F. Reconciliation of Cost Applicable to Sales and Cost Applicable to Sales per Unit Sold” for a reconciliation of Cost applicable to sales per unit sold to Cost of sales, excluding depreciation and amortization.

Julcani

Julcani is an underground mine that is ~~wholly owned~~wholly-owned and operated by us. We acquired Julcani in 1953 as our first operating mine. Julcani is located in the province of Angaraes, department of Huancavelica, approximately 500 kilometers southeast of Lima at an altitude of between 4,200 and 5,000 meters above sea level. ~~As of December 31, 2012, the net total fixed assets of Julcani were approximately US$6.2million.~~

Julcani is a large polymetallic deposit in Central Peru, which principally produces silver, that occurs mainly ~~as tetrahedrite and~~in sulfosalts in a multitude of mineralogically complex veins ~~hosted by~~in dacite domes, ~~surge deposits~~tuffs, breccias and other tertiary volcanic rocks.

Ore is processed ~~in a concentrator plant located adjacent to the mine entrance. The ore is crushed and ground, and~~by bulk flotation ~~is used thereafter~~ to obtain a ~~silver-gold-lead concentrate.~~concentrate of silver-lead-copper-gold. The plant has a rated capacity of ~~500 DST~~550 tons per ~~day and had a 79 percent utilization rate in 2012.~~ day.

Electric power is generated by three ~~Conenhua~~ hydroelectric ~~plants. Power generation capacity from these~~ plants, ~~is 800 kW, 1,200 kW~~Huapa, Tucsipampa and ~~760 kW, respectively.~~El Ingenio. We are also ~~rely on~~connected to the Peruvian national electricity ~~grid for the mine’s remaining electrical power.~~grid. Water for operations ofin Julcani is obtained from mine drainage, a ~~creek, two springs~~stream and a ~~lake.~~small lagoon.

During ~~2012,~~2015, we focused our exploration activities ~~were focused~~ on ~~deepening~~ the main mineralized structures of ~~our~~the Acchilla and Estela ~~mines, where~~mines. In the Acchilla mine, we ~~completed 12,668 meters~~have begun exploration to test the deepening of ~~underground exploration tunnels and 12,830 meters of diamond drilling. In 2013, we plan~~silver mineralization in all main veins. We have also begun to ~~perform intense underground mining exploration~~explore for silver in an area that is adjacent to the Acchilla and Estela, exploring, at the 610-meter, 660-meter and 710-meter levels, all recognized veins of Acchilla, and at the 560-meter, 610-meter and 660-meter of Estela, complemented by a diamond drilling program.mine called Taype-Galindo.

At December 31, ~~2012,~~2015, total proven and probable ore reserves were ~~261,405 DST,~~288,779 tons, with ~~18.5 ounces~~648.20 grams per ton of silver, ~~0.021 ounces~~0.50 grams per ton of gold, ~~1.8 percent~~2.52% lead and 0.52 percent copper, and total probable ore reserves were 163,200 DST, with 18.7 ounces per ton of silver, 0.012 ounces per ton of gold, 1.9 percent lead and 0.44 percent copper. Total estimated NRM was 315,475 DST, with 19.1 ounces per ton of silver, 0.034 ounces per ton of gold, 2.0 percent lead and 0.60 percent0.55% copper.

Set forth below are certain unaudited operating data for the periods shown for Julcani, calculated on the basis of ~~100 percent~~100% of the mine’s ~~production.~~production

Year Ended December 31,⁽¹⁾
2010 2011
2012⁽²⁾

Mining Operations:
Ore mined (ST) 127,500 140,300 141,820
Average gold grade (oz./ST) 0.024 0.022 0.017
Average silver grade (oz./ST) 18.96 18.62 18.50
Average lead grade 1.89 1.61 1.94
Average copper grade (%) 0.27 0.31 0.32
Production:
Gold (oz.) 2,118 2,051 1,220
Silver (oz.) 2,237,063 2,428,330 2,438,084
Lead (ST) 2,202 2,065 2,529
Copper (ST) 3.5 394 423
Recovery rate (gold) (%) 76.1 66.6 51.2
Recovery rate (silver) (%) 92.5 92.9 92.9

	Year Ended December 31,⁽¹⁾
	2014⁽²⁾⁽³⁾		2015⁽²⁾⁽³⁾
Mining Operations:
Ore mined (t)		167,750		177,948
Average gold grade (g/t)		0.25		0.22
Average silver grade (g/t)		600.97		597.66
Average lead grade (%)		1.69		1.55
Average copper grade (%)		0.18		0.21
Production:
Gold (oz.)		414		607
Silver (oz.)		3,084,347		3,266,453
Lead (t)		2,619		2,592
Copper (t)		275		339
Recovery rate (silver) (%)		95.16		95.52
Cost applicable to sales per oz. of gold⁽⁴⁾	US$	603	US$	955
Cost applicable to sales per oz. of silver⁽⁴⁾	US$	14.14	US$	12.30
Cost applicable to sales per ton of lead⁽⁴⁾	US$	1,603	US$	1,425
Cost applicable to sales per ton of copper⁽⁴⁾	US$	5,195	US$	4,416

(1)

~~Incorporates~~Includes losses ~~for~~due to mining dilution and recovery.

(2)

~~Incorporates~~Includes total Acchilla and Estela mine production.

(3)

Reflects total recovery percentage of Acchilla and Estela ore.

(4)

Cost applicable to sales per unit of mineral sold is not a measure of financial performance under IFRS and may not be comparable to similarly titled measures of other companies. Cost applicable to sales per ounce of gold, ounce of silver, ton of lead or ton of copper consists of cost applicable to sales for gold, silver, lead or copper sold, divided by the volume of gold, silver, lead or copper produced in the specified period. The cost applicable to sales per unit of mineral sold figures disclosed herein are calculated without adjusting for by-product revenue amounts. We consider cost applicable to sales per unit of mineral to be a key measure in managing and evaluating our operating performance. We believe this measure is widely reported in the precious metals industry as a benchmark for performance, but does not have standardized meanings. You should not consider cost applicable to sales per unit of mineral sold as an alternative to cost of sales determined in accordance with IFRS as an indicator of our operating performance. See “Item 5. Operating and Financial Review Prospects—Buenaventura—F. Reconciliation of Cost Applicable to Sales and Cost Applicable to Sales per Unit Sold” for a reconciliation of Cost applicable to sales per unit sold to Cost of sales, excluding depreciation and amortization.

~~Recuperada~~

Mallay

The ~~Recuperada~~Mallay mine is ~~wholly owned~~wholly-owned and operated by ~~us. Recuperada~~us and is located 21 kilometers southwest of the Uchucchacua mine in the district of Mallay, province of ~~Huancavelica,~~Oyón, department of ~~Huancavelica, approximately 540 kilometers southeast~~Lima. Mallay is considered an epithermal deposit of ~~Lima at an altitude of between 4,300~~silver, lead, zinc and ~~4,800 meters above sea level. Access is by a 242-kilometer unpaved public road, which connects to~~gold. We have recognized the Pan-American Highway. Electricity is supplied by access to the Peruvian national electricity grid via a 50-kilometer power line, which has a capacity of 22 kilovolts and 4,000 kilowatts. At December 31, 2012, the net total fixed assets of Recuperada were approximately US$3.8million.

~~The Recuperada mining district mainly contains polymetallic mineralization in veins of zinc,~~following main ore structures: Isguiz body-vein (silver, lead, ~~and silver (including the Teresita, Esperanza and Angelica deposits)~~zinc), ~~as well as some silver-rich veins (including the~~Pierina (gold vein), María ~~Luz, Nancy Luz~~(silver vein) and ~~Rico Antimonio deposits)~~Fortuna (skarn type lead, zinc, silver).

Recuperada is an underground mine that uses the conventional cut and fill mining method. Mine ore is processed at a concentrator plant on site with a processing capacity rate of 600 stpd. The tailing dam on site currently provides us with approximately 3.0 years of storage capacity based on current production rates.

During ~~2012,~~2015, we ~~completed 9,494 meters of~~continued geological exploration with tunnels and diamond drilling mainly focused on the Isguiz body-vein and the María-Dana system silver veins. In 2016, we plan to construct exploration tunnels and ~~7,995~~conduct diamond drilling on the Nicole area in the Jumasha limestones. The San Sebastian project (2.5 kilometers northeast from Isguiz) will be explored for silver, lead and zinc with at least 3,500 meters of diamond ~~drilling. We focused on searching for silver mineral~~drilling in the Germana, Esperanza and Nancy Luz areas and completing exploration at the 40-meter level of the Teresita mine. In 2013, we plan to continue exploration, focusing mainly in mines with silver mineralization, such as Germana Este, Nancy Luz, Acchisayhua and Escopeta.recognized mineralized structures by geological mapping.

AtAs of December 31, ~~2012, total~~2015, proven and probable ore reserves were ~~66,480 DST,~~86,446 tons, with ~~8.3 ounces~~341.21 grams per ton of silver, ~~4.51 percent lead and 7.64 percent zinc, and total probable ore reserves were 48,005 DST, with 9.5 ounces~~0.50 grams per ton of ~~silver, 3.39 percent~~gold, 6.35% lead and ~~6.24 percent~~8.93% zinc. ~~Total estimated NRM was 121,560 DST, with 8.50 ounces per ton of silver, 4.67 percent lead and 6.74 percent zinc.~~

Set forth below are certain unaudited operating data for the ~~periods shown for Recuperada,~~Mallay mine, calculated on the basis of ~~100 percent~~100% of the mine’s production.

Year Ended December 31,⁽¹⁾
2010
2011⁽²⁾

2012⁽²⁾

Mining Operations:
Ore mined (ST) 120,800 112,450 117,600
Average silver grade (oz./ST) 5.03 4.67 4.19
Average lead grade (%) 3.10 3.07 3.20
Average zinc grade (%) 2.54 3.77 4.88
Production:
Silver (oz.) 571,189 498,424 467,475
Lead (ST) 3,488 3,213 3,516
Zinc (ST) 2,494 3,581 4,898
Recovery rate (silver) (%) 94.1 94.9 94.78

~~(1)~~

~~Incorporates losses for mining dilution and recovery.~~

~~(2)~~

~~Incorporates total Teresita, Esperanza and Angélica mine production.~~

~~Antapite~~

Antapite is an underground mine that is wholly owned and operated by us. Antapite is located in the province of Huaytará, department of Huancavelica, approximately 434 kilometers southeast of the city of Lima at an altitude of approximately 3,400 meters above sea level. The Antapite mine consists of an epithermal low sulfidation gold deposit in veins hosted by calc-alkaline volcanic rocks. At December 31, 2012, the net total fixed assets of Antapite were approximately US$2.0million.

Mining is conducted underground utilizing the conventional cut-and-fill stopping method. Ore is processed at a cyanidation plant located at Antapite. The plant has a capacity of 600 DST per day and had a 52.0 percent utilization rate in 2012.

~~The Antapite mine obtains substantially all of its electric power through the Peruvian national electricity grid. Water for operations at Antapite is obtained from an underground drainage system.~~

During 2012, we focused our exploration efforts on the Antapite, Euriosa, Soledad, Olvidada, Pampeñita 1, Pucarumi, Fabiola, Nidia, Verónica and Alicia veins. We completed 9,117 meters of exploration tunnels and 20,830 meters of diamond drilling. In 2013, we plan to continue our exploration efforts for ore reserves in the southeastern region over the mineralized alignments formed by the Soledad, Carolina, Amatista, Furiosa, Pucarumi and Zorro Rojo veins.

As of December 31, 2012, total proven ore reserves were 29,951 DST with 0.330 ounces per ton of gold and 0.22 ounces per ton of silver, and total probable ore reserves were 17,794 DST with 0.210 ounces per ton of gold and 0.22 ounces per ton of silver. Total estimated NRM was 6,790 DST, with 0.280 ounces per ton of gold and 0.20 ounces per ton of silver.

~~Set forth below are certain unaudited operating data for the periods shown for Antapite, calculated on the basis of 100 percent of the mine’s production.~~

Year Ended December 31,⁽¹⁾⁽²⁾

2010 2011 2012
Mining Operations:
Ore mined (ST) 145,915 155,842 86,113
Average gold grade (oz./ST) 0.254 0.190 0.142
Average silver grade (oz./ST) 0.34 0.295 0.219
Production:
Gold (oz.) 35,803 28,588 11,720
Silver (oz.) 36,870 33,521 13,254
Recovery rate (gold) (%) 96.8 96.4 95.6
Recovery rate (silver) (%) 74.0 72.8 70.2

~~(1)~~

~~Incorporates losses for mining dilution and recovery.~~

~~(2)~~

~~Data reflect only mining operations at the Antapite mine.~~

~~Shila-Paula~~

~~Shila and Paula are underground mines that are wholly owned and operated by Cedimin, our wholly-owned subsidiary. Shila and Paula encompass an aggregate of41,152 hectares of mining concessions, which are owned by Cedimin.At December 31, 2012, the net total fixed assets of the Shila and Paula mining operations were approximately US$3.5 million.~~

The Shila mine is located in the province of Castilla, department of Arequipa, approximately 1,350 kilometers southeast of Lima and 25 kilometers south of the Orcopampa mining operation, at an altitude of between 4,650 and 5,400 meters above sea level. Access is by a 250-kilometer unpaved road. The Shila mine is currently not operating due to a lack of ore reserves.

The Paula mine is located in the province of Castilla, department of Arequipa, approximately 1,400 kilometers southeast of the city of Lima and 40 kilometers south of the Orcopampa mining operation, at an altitude of between 5,000 and 5,400 meters above sea level.

Gold mineralization deposits in Shila-Paula have been classified as epithermal low sulfidation of the Quartz-Adularia-Sericite type. The veins are hosted in tertiary volcanic rocks associated with the Chinchón and Huayta calderas.

Mining operations are currently conducted only in the Paula mine. Mining is conducted underground using the cut-and-fill ascending method. Ore is processed at a metallurgical plant located at the Shila mine with a rated capacity of 230 DST per day. The plant had an approximately 72 percent utilization rate in 2012. The cyanidation plant at the Shila mine has a net capacity of 3,200 metric tons per year.

Electric power for Shila-Paula is currently provided by the Peruvian national electricity grid. Four diesel generators with a total installed capacity of 3,850 kW ensure the availability of electric power. The water for operations at Paula is obtained from runoff from snow peaks.

During 2012, we completed 11,397 meters of underground mining explorations and 27,201 meters of diamond drilling, mainly below the 4,830-meter level, on the Nazareno, Ramal Crucero, Nazareno 3, Angélica Maria, Lucia, Ramal Chapi, Liliana, Maria Belen and Juliana veins. In 2013, we plan to continue our exploration efforts.

As of December 31, 2012, our proven ore reserves were 5,971 DST, with 0.410 ounces per ton of gold and 0.910 ounces per ton of silver and our probable ore reserves were 2,400 DST, with 0.364 ounces per ton of gold and 0.950 ounces per ton of silver. Total NRM was 31,427 DST, with 0.373 ounces per ton of gold and 0.91 ounces per ton of silver. All ore reserves and NRM are in the Paula mine.

~~Set forth below are certain unaudited operating data for Shila-Paula, calculated on the basis of 100 percent of both mines’ combined production.~~

Year Ended December 31,⁽¹⁾⁽²⁾
2010 2011
2012⁽²⁾

Mining Operations:
Ore mined (ST) 64,047 47,590 59,056
Average gold grade (oz./ST) 0.234 0.319 0.342
Average silver grade (oz./ST) 0.96 0.90 2.022
Production:
Gold (oz.) 14,157 14,594 19,359
Silver (oz.) 46,578 34,833 95,485
Recovery rate (gold) (%) 94.4 96.1 95.98
Recovery rate (silver) (%) 75.9 79.3 79.96

	Year Ended December 31,⁽¹⁾⁽²⁾
	2014		2015
Mining Operations:
Ore mined (t)		148,058		158,124
Average silver grade (g/t)		272.77		269.48
Average lead grade (%)		5.80		5.05
Average zinc grade (%)		7.79		6.60
Production:
Silver (oz.)		1,216,064		1,285,361
Lead (t)		7,513		7,193
Zinc (t)		9,893		9,173
Recovery rate (silver) (%)		93.68		93.82
Cost applicable to sales per oz. of silver⁽³⁾	US$	13.76	US$	13.90
Cost applicable to sales per ton of lead⁽³⁾	US$	1,547	US$	1,544
Cost applicable to sales per ton of zinc⁽³⁾	US$	1,855	US$	1,794

(1)

Incorporates losses for mining dilution and recovery.

(2)

Data reflect ~~5,166 ST, 11.4 ounces~~mining operations at Mallay mine.

(3)

Cost applicable to sales per unit of mineral sold is not a measure of financial performance under IFRS and may not be comparable to similarly titled measures of other companies. Cost applicable to sales per ounce of silver, ton of ~~silver and 0.163 ounces per~~lead or ton of ~~gold (48,677 ounces~~zinc consists of cost applicable to sales for silver, lead or zinc sold, divided by the volume of silver, lead or zinc produced in the specified period. The cost applicable to sales per unit of mineral sold figures disclosed herein are calculated without adjusting for by-product revenue amounts. We consider cost applicable to sales per unit of mineral to be a key measure in managing and ~~701 ounces~~evaluating our operating performance. We believe this measure is widely reported in the precious metals industry as a benchmark for performance, but does not have standardized meanings. You should not consider cost applicable to sales per unit of ~~gold) based on metallurgical tests conducted at the Tambomayo mine.~~mineral sold as an alternative to cost of sales determined in accordance with IFRS as an indicator of our operating performance. See “Item 5. Operating and Financial Review Prospects—Buenaventura—F. Reconciliation of Cost Applicable to Sales and Cost Applicable to Sales per Unit Sold” for a reconciliation of Cost applicable to sales per unit sold to Cost of sales, excluding depreciation and amortization.

~~Ishihuinca~~Breapampa

The ~~Ishihuinca~~Breapampa mine is ~~wholly owned~~wholly-owned and operated by us. We lease the rights to the mining concessions of Ishihuinca from a third party. The lease agreement, which expires in 2015, requires payment by Inminsur to the lessor of a royalty of 7 percent of the price of the concentrates sold.~~At December 31, 2012, the net total fixed assets of Ishihuinca were approximately US$0.2million.~~

~~The Ishihuinca mine~~It is located in the district of Chumpi, province ~~of Caravelí,~~Parinacochas, department of ~~Arequipa, approximately 780 kilometers southeast~~Ayacucho. The ore deposit consists of gold and silver mineralization in an epithermal system high-sulfidation, emplaced into breccias of tertiary volcanic rocks. We located higher concentrations of gold-silver in oxides in the ~~city of Lima~~following geological prospects: Cerro Parccaorcco, Senccata, Pucagallo, Andrea, Ccaccapaqui, Sancos and Grace. In July 2012, we began the production phase at ~~an altitude of 2,200 meters above sea level. Access~~Cerro Parccaorcco, where gold is ~~by the Pan-American Highway.~~

Mining is conducted underground utilizing the conventional cut-and-fill stopping method. Ore is processed at a metallurgical plant located at Ishihuinca. The metallurgical plant, which has a rated capacity of 220 DST per day, utilizes bulk flotation and gravity concentration processes. The bulk flotation process produces a copper/gold concentrate. The gravity concentrates and gold-bearing concentrates are treated by cyanidation in vats and agitator tanks, respectively. The dissolved gold obtained from the cyanidation of both concentrates is precipitated using zinc dust. The resulting precipitate is refined in Lima and then sold to Johnson Matthey.

~~Electric power is provided by three electric generators with total installed capacity of 2,315 kW. Water for operations at Ishihuinca is obtained from underground wells.~~contained within silica-oxides.

During ~~2012,~~the productive period of Breacampa in 2014, we ~~completed 1,156 meters~~performed diamond drilling to update ore distribution at Parccaorcco and define the gold ore within the colluvial deposit close to the Parccaorcco open pit, where we recognized disseminated gold that is part of ~~underground exploration tunnels. In 2013,~~current reserves.

We ceased mining activities at Breapampa in November 2014. However, in 2015 we ~~plan to continue our exploration efforts to increase our reserves~~recovered 13,757 ounces of gold ~~ore by conducting exploration~~from the leachpads. Currently, the mine is in ~~surrounding areas.~~closure stage.

~~As of December 31, 2012, our proven ore reserves were 8,620 DST, with 0.330 ounces per ton of gold,~~Proven and probable ore reserves at December 31, 2015 were ~~4,327 DST,~~519,539 tons, with ~~0.342 ounces~~17.11 grams per ton of ~~gold. Total NRM was 2,938 DST, with 0.369 ounces~~silver and 0.44 grams per ton of gold.

Set forth below are certain unaudited operating data for the ~~periods shown for Ishihuinca,~~Breapampa mine, calculated on the basis of ~~100 percent~~100% of the mine’s production.

Year Ended December 31,⁽¹⁾
2010 2011 2012
Mining Operations:
Ore mined (ST) 4,708 8,092 17,751
Average gold grade (oz./ST) 0.223 0.269 0.261
Average copper grade (%) 0.53 0.50 0.18
Production:
Gold (oz.) 917 1,773 4,016
Copper (ST) 16 27 22
Recovery rate (gold) (%) 80.3 8,092 86.57
Recovery rate (copper) (%) 68.7 0.269 67.29

	Year Ended December 31,⁽¹⁾
	2014⁽²⁾		2015⁽³⁾
Mining Operations:
Ore mined (t)		2,264,111		—
Average gold grade (g/t)		1.54		—
Average silver grade (g/t)		35.02		—
Production:
Gold (oz.)		74,807		13,757
Silver (oz.)		369,032		180,277
Cost applicable to sales per oz. of silver⁽⁴⁾	US$	6.56	US$	9.26
Cost applicable to sales per oz. of gold⁽⁴⁾	US$	452	US$	715

(1)

Incorporates losses for mining dilution and ~~recovery.~~recovery and reflects operations through 2014.

(2)

Data reflects mining operations only at Parccaorcco and its Colluvial deposit.

(3)

Mining operations at Breapampa were suspended in 2014. Production data for 2015 reflects gold and silver recovered from leach pads.

(4)

Cost applicable to sales per unit of mineral sold is not a measure of financial performance under IFRS and may not be comparable to similarly titled measures of other companies. Cost applicable to sales per ounce of gold or ounce of silver consists of cost applicable to sales for gold or silver sold, divided by the volume of gold or silver produced in the specified period. The cost applicable to sales per unit of mineral sold figures disclosed herein are calculated without adjusting for by-product revenue amounts. We consider cost applicable to sales per unit of mineral to be a key measure in managing and evaluating our operating performance. We believe this measure is widely reported in the precious metals industry as a benchmark for performance, but does not have standardized meanings. You should not consider cost applicable to sales per unit of mineral sold as an alternative to cost of sales determined in accordance with IFRS as an indicator of our operating performance. See “Item 5. Operating and Financial Review Prospects—Buenaventura—F. Reconciliation of Cost Applicable to Sales and Cost Applicable to Sales per Unit Sold” for a reconciliation of Cost applicable to sales per unit sold to Cost of sales, excluding depreciation and amortization.

La Zanja

The La Zanja mine is located in the district of Pulan, province of Santa Cruz, department of Cajamarca in northern Peru. La Zanja ~~consists of approximately 37,000 hectares of mining concessions and~~ is located 48 kilometers northwest of the Yanacocha gold mine, at an average altitude of 3,500 meters above sea level. We hold a ~~53.06 percent~~53.06% interest in La Zanja and Newmont holds a ~~46.94 percent interest.~~46.94% interest.

La Zanja is located within a large area of hydrothermal alteration, mainly related to epithermal gold deposits in high sulfidation environments, in addition to some vein systems of intermediate to low sulfidation. We have recognized two ore deposits: San Pedro Sur and Cerro Pampa Verde.

Mining operations are conducted through the open-pit method, ~~and~~the plant utilizes a carbon-in-column ~~circuits are utilized~~circuit as well as a Merrill Crowe circuit to recover gold from heap leach operations. The ~~gold-laden~~gold laden carbon is then transported to Yanacocha to continue processing into doré bars.

~~During 2012,~~In 2013, we completed ~~26,026 meters~~the construction of the road to Pampa Verde, which allowed us to begin open pit mining in February 2014, coinciding with the launching of the Merrill Crowe plant.

During 2015, we continued tunneling and diamond drilling exploration in the Alejandra underground project. We also continued exploring with diamond drilling in other areas around San Pedro Sur, Pampa Verde and ~~Cocan. In 2013, we plan to perform 20,000 meters of diamond drilling at the Pampa Verde, San Pedro Sur~~Alejandra, such as Cocán and ~~Cocan projects. We plan to start mining at Pampa Verde in July 2013.~~Campana.

Total proven and probable ore reserves at December 31, ~~2012~~2015 were ~~24,795,233 DST,~~11,905,137 tons, with ~~0.018 ounces~~4.04 grams per ton of ~~gold~~silver and ~~0.208 ounces~~0.62 grams per ton of ~~silver. Total NRM was 12,131,615 DST, with 0.015 ounces per ton of gold and 0.211 ounces per ton of silver.~~gold.

Set forth below are certain unaudited operating data for La Zanja, calculated on the basis of ~~100 percent~~100% of the mine’s production.

	Year Ended December 31,⁽¹⁾						Year Ended December 31,
	2010		2011		2012		2014		2015
Mining Operations:
Ore mined (ST)		64,047		8,408,399		10,231,321
Average gold grade (oz./ST)		0.234		0.022		0.017
Average silver grade (oz./ST)		0.96		0.40		0.24
Ore treated (t)								7,501,654		8,576,614
Average gold grade (g/t)								0.84		0.70
Average silver grade (g/t)								8.71		5.97
Production:
Gold (oz.)		14,157		134,190		112,387		143,573		141,071
Silver (oz.)		46,578		363,927		387,877		422,395		331,080
Cost applicable to sales per oz. of gold⁽¹⁾							US$	569	US$	789
Cost applicable to sales per oz. of silver⁽¹⁾							US$	8.35	US$	10.55

(1)

~~Data reflect mining operations at~~Cost applicable to sales per unit of mineral sold is not a measure of financial performance under IFRS and may not be comparable to similarly titled measures of other companies. Cost applicable to sales per ounce of gold or ounce of silver consists of cost applicable to sales for gold or silver sold, divided by the ~~San Pedro Sur deposit only.~~volume of gold or silver produced in the specified period. The cost applicable to sales per unit of mineral sold figures disclosed herein are calculated without adjusting for by-product revenue amounts. We consider cost applicable to sales per unit of mineral to be a key measure in managing and evaluating our operating performance. We believe this measure is widely reported in the precious metals industry as a benchmark for performance, but does not have standardized meanings. You should not consider cost applicable to sales per unit of mineral sold as an alternative to cost of sales determined in accordance with IFRS as an indicator of our operating performance. See “Item 5. Operating and Financial Review Prospects—Buenaventura—F. Reconciliation of Cost Applicable to Sales and Cost Applicable to Sales per Unit Sold” for a reconciliation of Cost applicable to sales per unit sold to Cost of sales, excluding depreciation and amortization.

Tantahuatay

Tantahuatay is a gold-copper mine located in the district and province of Hualgayoc, department of Cajamarca, in northern Peru, at an average altitude of 3,900 meters above sea level. The ~~project includes a total of 17,721 hectares of mining claims. The~~ Tantahuatay mine is ~~wholly owned~~operated by us and wholly-owned by Coimolache, in which we hold a ~~40 percent~~40.10% equity interest.

Geologically, the Tantahuatay deposits are located at diatremes or volcanic necks in a ~~predominantly~~ sequence ~~volcano magmatic~~volcano-magmatic hydrothermal ~~manifestation,~~predominant linked to the regional mineralized sector north of Peru.

Tantahuatay consists of five areas of Au-Ag mineralization, contained in material of supergenic oxidation (Mirador Norte, Mirador Sur, Cienaga Norte, Cienaga Sur and Tantahuatay). We have ~~identified several geologic targets with gold mineralization and have conducted detailed studies~~also discovered that below the oxides level of the Cerro Tantahuatay area, there is a significant resource of Cu-Au-Ag in pyrite-enargite ore (sulphides), which is present as disseminations and fracture fillings associated with advanced argillic alteration and multiphase breccia bodies.

During 2015, we performed diamond drilling to update the reserves block model of the open pits Tantahuatay 2 and Ciénaga Norte and to explore the Mirador Sur, Mirador Norte, ~~deposits.~~

~~Tantahuatay 2 consists of hydrothermal breccia bodies, formed by silicified tuff fragments in a matrix of quartz-alunite-pyrophyllite, with iron oxides inside fractures~~ and ~~cavities, which contain free gold and electrum as submicroscopic particles.~~

Ciénaga Norte and Mirador Norte consist of hydrothermal breccia bodies, formed in facies of vuggy silica and sandy silica, hosted in tuffs and hornblende lavas, which contain free submicroscopic gold mainly in iron oxides.

~~In August 2011, we received approval~~projects to ~~commence operations at the Tantahuatay processing plant and began to produce gold and silver at Tantahuatay 2.~~

In 2012, we launched a new smelting furnace and completed the expansion in the capacity of our Merrill-Crowe-type ore processing facility from 800 to 1,100 cubic meters per hour. We also completed 6,763 meters of reverse circulation drilling to explore ore deposits and conduct metallurgical tests. In 2013, we expect to complete infrastructure construction to allow for mining of the Ciénaga Norte deposit in the fourth quarter of 2013.increase mineral resources.

Total proven and probable ore reserves at December 31, ~~2012~~2015 were ~~24,427,771 DST,~~66,196,953 tons, with ore grades of 0.019 ounces per ton of gold and 0.24 ounces per ton of silver. Total NRM in oxides was 105,884,751 DST, with ore grades of 0.012 ounces per ton of gold and 0.17 ounces per ton of silver. Total NRM in sulfides was 422,318,006 DST, with ore grades of 0.007 ounces per ton of gold, 0.18 ounces7.09 grams per ton of silver and ~~0.67 percent copper.~~0.43 grams per ton of gold.

Set forth below are certain unaudited operating data for the Tantahuatay mine, calculated on the basis of ~~100 percent~~100% of the mine’s production.

	Year Ended December 31,⁽¹⁾⁽²⁾				Year Ended December 31,⁽¹⁾⁽²⁾
	2011		2012		2014		2015
Mining Operations:
Ore mined (ST)		3,963,580		10,881,767
Average silver grade (oz./ST)		0.63		0.48
Average gold grade (oz./ST)		0.017		0.017
Ore treated (t)						9,854,334		12,185,425
Average gold grade (g/t)						0.57		0.50
Average silver grade (g/t)						11.08		13.00
Production:
Gold (oz.)						143,643		144,782
Silver (oz.)		260,073		919,343		754,357		879,832
Gold (oz.)		46,164		141,268
Cost applicable to sales per oz. of gold⁽³⁾					US$	455	US$	489
Cost applicable to sales per oz. of silver⁽³⁾					US$	6.71	US$	6.59

(1)

Incorporates losses for mining dilution and recovery.

(2)

Data reflect mining operations at the Tantahuatay 2 deposit only.

~~Breapampa~~

The Breapampa mine, is wholly owned and operated by us and encompasses 38,690 hectares of mining concessions. It is located in the district of Chumpi, province Parinacochas, department of Ayacucho. The ore deposit consists of gold and silver mineralization in an epithermal system high-sulfidation, emplaced into breccias of tertiary volcanic rocks. We located higher concentrations of gold-silver in oxides in the Cerro Parccaorcco, Senccata, Pucagallo, Andrea, Ccaccapaqui, Sancos and Grace prospects. In July 2012, we began the production phase at Cerro Parccaorcco, having disseminated gold in silica-oxides.

We performed 10,387 meters of diamond drilling to update model ore distribution and explore around the Parccaorcco open pit, where we have recognized an ore body that is part of current reserves. In Senccata and Pucagallo, we performed a geophisycal survey of induced polarization that confirmed the existence of two silicified bodies to over 50 meters deep.

Proven ore reserves as of December 31, 2012 were 4,542,614 DST, with 0.041 ounces per ton of gold and 0.77 ounces per ton of silver. Probable ore reserves were 590,683 DST, with 0.017 ounces per ton of gold and 0.40 ounces per ton of silver. Total NRM in oxides were 1,692,792 DST, with 0.038 ounces per ton of gold and 0.11 ounces per ton of silver, 56.8% of which were derived from the Pucagallo prospect and 43.2% of which derived from the Senccata prospect. In 2013, we plan to conduct an intense drilling program, focusing primarily in new areas, and also complete modeling of the Senccata and Pucagallo prospects.

~~Set forth below are certain unaudited operating data for the Breapampa mine, calculated on the basis of 100 percent of the mine’s production.~~

Year Ended December 31,⁽¹⁾⁽²⁾

2011 2012
Mining Operations:
Ore mined (ST) - 579,115
Average silver grade (oz./ST) - 0.502
Average gold grade (oz./ST) - 0.028
Production:
Silver (oz.) - 17,212
Gold (oz.) - 8,817

~~(1)~~(3)

~~Incorporates losses~~Cost applicable to sales per unit of mineral sold is not a measure of financial performance under IFRS and may not be comparable to similarly titled measures of other companies. Cost applicable to sales per ounce of gold or ounce of silver consists of cost applicable to sales for ~~mining dilution~~gold or silver sold, divided by the volume of gold or silver produced in the specified period. The cost applicable to sales per unit of mineral sold figures disclosed herein are calculated without adjusting for by-product revenue amounts. We consider cost applicable to sales per unit of mineral to be a key measure in managing and ~~recovery.~~

~~(2)~~

~~Data reflect mining operations at~~evaluating our operating performance. We believe this measure is widely reported in the ~~Parccaorcco deposit only.~~precious metals industry as a benchmark for performance, but does not have standardized meanings. You should not consider cost applicable to sales per unit of mineral sold as an alternative to cost of sales determined in accordance with IFRS as an indicator of our operating performance. See “Item 5. Operating and Financial Review Prospects—Buenaventura—F. Reconciliation of Cost Applicable to Sales and Cost Applicable to Sales per Unit Sold” for a reconciliation of Cost applicable to sales per unit sold to Cost of sales, excluding depreciation and amortization

~~Mallay~~

The Mallay mine is wholly owned and operated by us and is located 21 kilometers southwest of the Uchucchacua mine in the district of Mallay, province of Oyón, department of Lima. The project is comprised of approximiately 2,300 hectares of mining concessions. Mallay is considered an epithermal deposit of silver, lead, zinc and gold. We have recognized the following major ore structures: Isguiz, Pierina, María and Fortuna Body.

The metallurgical processing plant began operations in mid-July 2012 with an average of 450 DST/day. During 2012, we constructed 9,389 meters of exploration tunnels and 20,380 meters of diamond drilling, focused mainly on mineralized structures of the Isguiz mine.

As of December 31, 2012, the proven ore reserves were 192,679 DST, with ore grades of 0.025 ounces per ton of gold, 10.29 ounces per ton of silver, 6.50 percent lead and 7.50 percent zinc, and the probable reserves were 95,434 DST, with ore grades of 0.028 ounces per ton of gold, 12.05 ounces per ton of silver, 5.71 percent lead and 6.26 percent zinc. Total NRM was 179,639 DST, with ore grades of 0.060 ounces per ton of gold, 11.56 ounces per ton of silver, 4.62 percent lead and 5.12 percent zinc. In 2013, we will focus exploration efforts on the Isguis and María-Dana vein systems, mainly at the 4370-meter and 4090-meter levels, as well as continue exploration of the Pierina vein at the 4310-meter and 4250-meter levels.

~~Set forth below are certain unaudited operating data for the Mallay mine, calculated on the basis of 100 percent of the mine’s production.~~

Year Ended December 31,⁽¹⁾⁽²⁾

2011 2012
Mining Operations:
Ore mined (ST) - 114,166
Average silver grade (oz./ST) - 6.65
Average gold grade (oz./ST) - 0.011
Average lead grade (%) - 5.18
Average zinc grade (%) - 7.24
Production:
Silver (oz.) - 682,708
Gold (oz.) - 107
Lead (ST.) - 4,952
Zinc (ST.) - 6,711
Recovery rate silver (%) - 89.9

~~(1)~~

~~Incorporates losses for mining dilution and recovery.~~

~~(2)~~

~~Data reflects mining operations at the Mallay deposit only.~~

Colquijirca and Marcapunta Norte

The Colquijirca (also known as Tajo Norte) and Marcapunta Norte mines are ~~wholly owned~~wholly-owned by El Brocal. El Brocal was founded in 1956 and is engaged in the extraction, concentration and sale of concentrates of polymetallic minerals—mainly zinc, copper, lead and silver. Our aggregate direct and indirect equity interest in El Brocal was ~~53.76 percent~~54.07% at December 31, ~~2012. At December 31, 2012 the net total fixed assets of Colquijirca and Marcapunta Norte were approximately US$343 million.~~2015.

The Colquijirca and Marcapunta Norte mines are adjacent and are located 285 kilometers east of the city of Lima and 10 kilometers south of the city of Cerro de Pasco. El Brocal produces zinc and lead/silver concentrates from the Colquijirca mine and copper concentrates from the Marcapunta Norte mine. The Colquijirca mine consists of three important polymetallic deposits: (1) Tajo Norte, which contains zinc, silver and lead ore; (2) Marcapunta, which contains an auriferous mineralization in breccia oxides and an arsenic copper enargite mineralization as a continuation of the mineralized mantles of the Marcapunta Norte mine; and (3) San Gregorio, which contains zinc.

Mining at Colquijirca is conducted through the open-pit method from which zinc and lead concentrates are produced. El Brocal’s zinc concentrate typically contains ~~50 percent~~50% zinc, while its lead concentrate ~~typically~~ contains ~~51 percent~~50% lead. ~~The concentrates are sold to local smelters and traders depending on market conditions.~~ Mining at Marcapunta Norte is conducted through the ~~room and pillars~~sublevel stopping method, from which copper concentrates are produced. El Brocal’s copper concentrates typically contains ~~25 percent~~26% copper, ~~7 ounces of~~4% silver ~~and 8 percent~~and8% arsenic. ~~The concentrates are sold to local traders.~~

The Huaraucaca concentrator plant processes ore from both mines. In ~~2012,~~2015, average treated ore at the plant reached ~~up to 10,634metric~~13,875 tons per day. as result of increased capacity from 10,732 tons per day in the first quarter of 2015 to 16,591 tons per day in the fourth quarter of 2015 due to the completion of an expansion project. The Colquijirca mine primarily relies on a power line connected to the Peruvian national electricity grid.

El Brocal has conducted an exploration program at the Marcapunta deposit to confirm mineralization and find possible extensions, as well as to increase reserves at the Colquijirca and Marcapunta Norte mines. This program ~~will continue throughout 2013.~~was discontinued in 2014. At the end of 2014, El Brocal obtained approval for its EIS relating to a diamond drilling program at the Marcapunta deposit.

In ~~2012,~~2015, we invested US$~~103.7~~24 million ~~to expand~~in tailings capacity expansion and complementary equipment for a processing plant. The construction of the expansion project operations were completed in 2014 (which, since 2008, has cost US$500 million) and ~~have invested a total~~reached the full expected capacity of ~~US$278.0 million since 2008. We also continued~~18,000 tons per day in December 2015.In 2015, exploration was halted in prospective areas such as San Gregorio, Marcapunta Oeste and other areas ~~at a cost of US$18.4 million. We also continued the construction and implementation of~~to focus efforts on increasing the crushing, milling and ~~floatation~~flotation processes ~~under our expansion program, as well as construction of~~to the ~~Huachuacaca tailings facility.~~

In 2013, we plan to conduct an initial exploration program in Huancavelica at the Yanamina Millocucho zone to continue with prospecting activities. The expansion project, which will enable us to increase treatment capacity to up to 18,000 tpd of ore, should be completed during the second half of 2013.expected capacity.

Total proven and probable reserves of Colquijirca as of December 31, ~~2012~~2015 were ~~63,333,000 DST,~~56,200,000 tons, with ~~0.76 ounces~~35.15 grams of silver per ton, ~~2.4 percent~~2.3% of zinc and ~~0.8 percent~~0.85% of lead. Total proven and probable reserves of Marcapunta Norte as of December 31, ~~2012~~2015 were ~~20,016,145 DST,~~21,749,700 tons with ~~0.47 ounces~~18.973 grams of silver per ton, ~~0.010 ounces~~0.39 grams of gold per ton and ~~1.99 percent~~2.25% copper. Total NRM as of December 31, 2012 for Colquijirca was 45,532,188 DST, with 0.42 ounces per ton of silver, 1.76 percent zinc and 0.52 percent lead. Total NRM for Marcapunta Norte was 56,430,044 DST, with 0.57 ounces per ton of silver, 0.013 ounces per ton of gold and 1.71 percent copper.

Set forth below are certain unaudited operating data for the Colquijirca mine, calculated on the basis of ~~100 percent~~100% of the mine’s production.

	Year Ended December 31,⁽¹⁾
	2010		2011		2012		Year Ended December 31,⁽¹⁾
							2014		2015
Mining Operations:
Ore mined (ST)		1,150,527		929,032		1,862,717
Average silver grade (oz./ST)		2.30		2.67		1.20
Ore mined (t)								481,589		3,101,851
Average silver grade (oz./t)								1.92		1.34
Average zinc grade (%)		4.69		3.90		2.93		3.12		2.77
Average lead grade (%)		1.68		1.69		1.10		1.20		1.03
Production:
Silver (oz.)		1,901,661		1,876,434		1,409,877		603,342		2,811,391
Zinc (ST)		38,955		25,968		33,268
Lead (ST)		12,768		10,432		10,654
Zinc (t)								10,126		53,319
Lead (t)								3,459		18,854
Recovery rate (silver) (%)		69.1		76.1		63.2		64.30		67.52
Recovery rate (zinc) (%)		72.17		71.92		67.11		67.06		61.96
Recovery rate (lead) (%)		66.00		66.57		57.25		56.42		58.73
Cost applicable to sales per ton of mine⁽²⁾								1,369		1,601

(1)

Incorporates losses for mining dilution and recovery.

(2)

Represents cost applicable to sales per ton of zinc for El Brocal. Cost applicable to sales per unit of mineral sold is not a measure of financial performance under IFRS and may not be comparable to similarly titled measures of other companies. Cost applicable to sales per ton of zinc consists of cost applicable to sales for zinc divided by the volume of zinc produced in the specified period. The cost applicable to sales per unit of mineral sold figures disclosed herein are calculated without adjusting for by-product revenue amounts. We consider cost applicable to sales per unit of mineral to be a key measure in managing and evaluating our operating performance. We believe this measure is widely reported in the precious metals industry as a benchmark for performance, but does not have standardized meanings. You should not consider cost applicable to sales per unit of mineral sold as an alternative to cost of sales determined in accordance with IFRS as an indicator of our operating performance. See “Item 5. Operating and Financial Review Prospects—Buenaventura—F. Reconciliation of Cost Applicable to Sales and Cost Applicable to Sales per Unit Sold” for a reconciliation of Cost applicable to sales per unit sold to Cost of sales, excluding depreciation and amortization.

Set forth below are certain unaudited operating data for the Marcapunta Norte mine, calculated on the basis of ~~100 percent~~100% of the mine’s production.

	Year Ended December 31,⁽¹⁾
	2010		2011		2012		Year Ended December 31,⁽¹⁾
							2014		2015
Mining Operations:
Ore mined (ST)		946,659		1,961,759		2,042,904
Average silver grade (oz./ST)		1.06		1.03		0.38
Average gold grade (%)		0.013		0.010		0.011
Ore mined (t)								2,773,738		1,962,627
Average silver grade (oz./t)								0.84		0.75
Average gold grade (gr/t)								0.31		0.35
Average copper grade (%)		2.30		1.60		1.41		1.71		1.92
Production:
Silver (oz.)		608,438		1,035,315		421,512		1,463,872		858,109
Gold (oz)		5,549		8,498		10,220
Copper (ST)		18,707		26,231		22,785
Gold (oz.)								14,134		11,263
Copper (t)								43,282		32,061
Recovery rate (silver) in copper (%)		60.81		50.67		54.37		62.36		58.48
Recovery rate (gold) in copper (%)		45.79		45.02		45.21		56.50		50.27
Recovery rate copper (%)		85.86		83.06		86.52		86.23		87.0
Cost applicable to sales per ton of mine⁽²⁾								5,096		5,322

(1)

Incorporates losses for mining dilution and recovery.

(2)

Represents cost applicable to sales per ton of copper for El Brocal. Cost applicable to sales per unit of mineral sold is not a measure of financial performance under IFRS and may not be comparable to similarly titled measures of other companies. Cost applicable to sales per ton of copper consists of cost applicable to sales for copper divided by the volume of copper produced in the specified period. The cost applicable to sales per unit of mineral sold figures disclosed herein are calculated without adjusting for by-product revenue amounts. We consider cost applicable to sales per unit of mineral to be a key measure in managing and evaluating our operating performance. We believe this measure is widely reported in the precious metals industry as a benchmark for performance, but does not have standardized meanings. You should not consider cost applicable to sales per unit of mineral sold as an alternative to cost of sales determined in accordance with IFRS as an indicator of our operating performance. See “Item 5. Operating and Financial Review Prospects—Buenaventura—F. Reconciliation of Cost Applicable to Sales and Cost Applicable to Sales per Unit Sold” for a reconciliation of Cost applicable to sales per unit sold to Cost of sales, excluding depreciation and amortization.

Reserves

We calculate our ore reserves by methods generally applied within the mining industry and in accordance with ~~Commission~~SEC Industry Guide 7. All mineral reserves are ~~estimated quantities~~estimates of proven and probable ore quantities that under present conditions may be economically mined and processed.

The proven and probable ore reserve figures presented in this Annual Report are estimates, and no assurance can be given that the level of recovery of gold, silver and certain other metals will be realized. See “Item 3. Key Information—D. Risk Factors—Factors Relating to the Company—Estimates of proven and probable reserves are subject to uncertainties and the volume and grade of ore actually recovered may vary from our estimates.”

The term “reserves” refers to mineral deposits that could be economically and legally extracted or produced at the time of reserve determination. The term “proven reserves” means ore reserves for which (a) quantity is computed from dimensions revealed in outcrops, trenches, workings or drill holes, and grade and/or quality are computed from the results of detailed sampling, and (b) the sites for inspection, sampling and measurement are spaced so closely and the geologic character is so well defined that size, shape, depth and mineral content of reserves are well established. The term “probable reserves” means ore reserves for which quantity and grade and/or quality are computed from information similar to that used for proven reserves, but the sites for inspection, sampling and measurement are farther apart or are otherwise less adequately spaced. The degree of assurance, although lower than that for proven reserves, is high enough to assume continuity between points of observation.

As of December 31, ~~2012,~~2015, our total proven and probable reserves, including our equity share in the proven and probable reserves of El Brocal (54.07%), La Zanja (53.06%), Coimolache (40.10%) and Yanacocha (43.65%), were estimated to be ~~1,385~~3.52 million ounces of gold, representing a 7%60.23% decrease compared to our total proven and probable reserves as of December 31, 2014, which were estimated to be 8.85 million ounces of gold. This decrease is primarily due to the reclassification of the Conga mine gold reserves (5.5 million ounces as of December 31, 2014) as resources or NRM as of December 31, 2015.

As of December 31, 2015, our total proven and probable reserves, including our equity share in El Brocal (54.07%), La Zanja (53.06%), Coimolache (Tantahuatay) (40.10%) and Yanacocha (43.65%), were estimated to be 139.04 million ounces of silver, representing a 17.29% decrease over our total proven and probable reserves as of December 31, ~~2011,~~2014, which were estimated to be ~~1,485~~168.10 million ounces of ~~gold. The~~silver. This decrease ~~in reserves of gold was mainly~~is primarily due to the reclassification of the Conga mine ~~depletion and the lack of replacements for gold production at La Zanja.~~

~~As of December 31, 2012, our total proven and probable~~silver reserves ~~were estimated to be 154,606~~(37.8 million ounces ~~of silver, representing a 1% decrease over our total proven and probable reserves~~ as of December 31, ~~2011, which were estimated to be 155,437 million ounces~~2014) as resources or NRM as of ~~silver. The decrease in reserves of silver was mainly due to mine depletion and the lack of replacements for silver production at El Brocal.~~December 31, 2015.

The following table lists the proven and probable ore reserves ~~and the average grade of such ore,~~ as of December 31, ~~2012,~~2015 for each of our consolidated mining operations, ~~and~~ the Tantahuatay mine, ~~in which~~where we have a ~~40 percent~~40.10% equity interest, ~~calculated on~~ the ~~basis~~La Zanja mine, where we have a 53.06% equity interest, and the Colquijirca & Marcapunta (El Brocal) mines, where we have a 54.07% equity interest. The reserves show in the table below are the total reserves for each mine and do not reflect our equity share of ~~100 percent of each mine’s~~ reserves ~~and US$1,400 per ounce of gold and US$30.00 per ounce of silver.~~in non-wholly-owned mines.

Proven ~~and~~ Ore Reserves at December 31, 2015^{(1) (2)}

	Orcopampa⁽³⁾		Uchucchacua⁽⁴⁾		Julcani⁽⁵⁾		Mallay⁽⁶⁾		Tambomayo⁽⁷⁾		Antapite⁽⁸⁾		Breapampa⁽⁹⁾		La Zanja⁽¹⁰⁾		Tantahuatay⁽¹¹⁾		Colquijirca^(12)(13)		Marcapunta^(12)(14)		Total/ Average

Ore Reserves (t)		447,911		2,688,395		198,365		66,572		747,639		24,538		519,539		4,672,820		53,810,366		18,400,000		5,833,113		87,409,258

Grade:
Gold (g/t)		14.86		-		0.53		0.50		9.01		10.16		0.45		0.63		0.45		-		0.40		0.50
Silver (g/t)		45.97		433.42		647.91		338.86		312.92		-		17.18		4.26		6.42		30.87		18.35		29.87
Copper (%)		-		-		0.57		-		-		-		-		-		-		0.09		2.36		0.13
Zinc (%)		-		2.00		-		8.91		2.87		-		-		-		-		2.68		-		0.99
Lead (%)		-		1.38		2.70		6.38		1.86		-		-		-		-		0.91		-		0.37

Content:
Gold (oz.)		213,918		-		3,364		1,076		216,503		8,017		7,515		94,920		782,032		-		75,016		1,402,361
Silver (oz.)		662,012		37,461,786		4,132,117		725,265		7,521,652		-		286,981		639,878		11,107,786		18,264,000		3,441,537		84,243,014
Copper (t)		-		-		1,135		-		-		-		-		-		-		15,840		137,661		154,636
Zinc (t)		-		53,793		-		5,931		21,490		-		-		-		-		492,720		-		573,934
Lead (t)		-		37,177		5,346		4,250		13,882		-		-		-		-		168,160		-		228,815

Probable Ore Reserves at December 31, ~~2012~~2015^(1)(2)(3)

	Julcani⁽⁴⁾		Uchucchacua⁽⁵⁾		Orcopampa⁽⁶⁾		Recuperada⁽⁷⁾		Mallay⁽⁸⁾		Colquijirca^(9)(10)		Marcapunta^(9)(11)		Ishihuinca		Antapite⁽¹²⁾		Shila- Paula⁽¹³⁾		Poracota⁽¹⁴⁾		Breapampa⁽¹⁵⁾		Tantahuatay⁽¹⁶⁾		La Zanja⁽¹⁷⁾		Total/ Average		Orcopampa⁽³⁾		Uchucchacua⁽⁴⁾		Julcani⁽⁵⁾		Mallay⁽⁶⁾		Tambomayo⁽⁷⁾		Antapite⁽⁸⁾		Breapampa⁽⁹⁾		La Zanja⁽¹⁰⁾		Tantahuatay⁽¹¹⁾		Colquijirca^(12)(13)		Marcapunta^(12)(14)		Total/ Average
Ore Reserves (ST)		424,605		5,684,990		1,090,891		114,485		288,113		63,333,221		20,016,327		12,947		47,745		8,371		36,487		5,133,297		39,273,107		24,795,233		160,259,819

Ore Reserves (t)																																200,442		1,582,825		90,414		19,874		333,392		13,009		-		7,232,317		12,386,587		37,800,000		15,916,645		75,575,505

Grade:
Gold (oz./ST)		0.017		-		0.421		-		0.026		-		0.010		0.334		0.300		0.397		0.332		0.038		0.013		0.018		0.014
Silver (oz./ST)		18.56		12.68		0.54		8.80		10.87		0.76		0.47		-		0.22		0.92		0.079		0.73		0.313		0.208		1.02
Gold (g/t)																																14.64		-		0.45		0.55		10.41		10.91		-		0.61		0.35		-		0.39		0.57
Silver (g/t)																																63.69		464.58		648.82		349.19		231.88		-		-		4.02		9.99		37.17		18.97		35.63
Copper (%)		0.50		-		-		-		-		-		1.99		-		-		-		-		-		-		-		-		-		-		0.50		-		-		-		-		-		-		0.42		2.21		0.93
Zinc (%)		-		1.77		-		7.05		7.09		2.40		-		-		-		-		-		-		-		-		-		-		1.45		-		9.01		3.31		-		-		-		-		2.11		–		0.09
Lead (%)		1.88		1.25		-		4.04		6.24		0.80		-		-		-		-		-		-		-		-		-		-		1.12		2.14		6.23		2.31		-		-		-		-		0.82		–		0.08

Content:
Gold (oz.)		7,398		-		459,265		-		7,596		-		204,333		4,326		14,324		3,323		12,114		197,144		528,346		437,345		2,206,514		94,338		-		1,295		350		111,561		4,564		-		140,705		138,450		-		199,575		690,838
Silver (oz.)		7,879,249		72,097,949		589,081		1,007,468		3,132,941		48,262,200		9,442,435				10,504		7,732		2,882		3,749,722		12,278,957		5,156,137		163,617,257		410,457		23,641,913		1,886,037		223,118		2,485,514		-		-		933,664		3,979,665		45,169,000		9,709,154		88,438,522
Copper (ST)		2,102		-		-		-		-		-		398,325		-		-		-		-		-		-		-		400,427
Zinc (ST)		-		100,345		-		8,071		20,427		1,519,997		-		-		-		-		-		-		-		-		1,648,840
Lead (ST)		7,990		71,139		-		4,625		17,978		506,666		-		-		-		-		-		-		-		-		608,398
Copper (t)																																-		-		454		-		-		-		-		-		-		157,510		351,758		509,722
Zinc (t)																																-		23,013		-		1,790		11,028		-		-		-		-		799,270		–		835,101
Lead (t)																																-		17,743		1,931		1,239		7,688		-		-		-		-		308,560		–		337,161

(1)

~~Algon Investment S.R.L.~~Geominería S.A.C., an independent consultant ~~is in~~company, audits the process ~~of reviewing the framework~~ used to estimate proven and probable ore reserves ~~for~~in our wholly-owned mines, as of December 31, ~~2012.~~2015. In 2014 MINTEC Inc., an independent consultant, ~~is in~~updated the ~~process~~proven and probable reserves for El Brocal and defined the final limits of ~~reviewing~~ the ~~conceptual framework~~open pit. As of December 31, 2015, we have updated topographically subtracting the 2015 production. HATCH, an independent consultant, audits the process used to estimate proven and probable ore reserves for ~~El Brocal’s mines as of~~La Zanja and Tantahuatay at December 31, ~~2012.~~

2015.

(2)

The metallurgical recovery factors used to calculate reserves for each of our mines include ore quality, gradation of ore (which impacts the effectiveness of reagents in releasing valuable particles), quality of water used to treat ore (recycled water contains impurities that can interfere with the chemical reaction of the reagents) and quality of reagent used to treat ore.

~~(3)~~

For the year ended December 31, ~~2012,~~2015, reserves ~~for our wholly-owned and operated mines (which include all of the mines listed above other than Colquijirca, Marcapunta, Tantahuatay and La Zanja)~~ were calculated using the following prices: US$~~1,400~~1,250 per ounce of gold, US$3019 per ounce of silver, US$~~2,028~~2,000 per ~~metric~~ ton of zinc, US$2,000 per ~~metric~~ ton of lead and US$~~6,600~~5,500 per ~~metric~~ ton of copper.

~~(4)~~

~~The metallurgical recovery factors that impacted the calculated reserves for Julcani at December 31, 2012 were whether the ore contained iron sulfide (Pirite) higher than 8% and the quality of water.~~

~~(5)~~

~~The metallurgical recovery factors that impacted the calculated reserves for Uchucchacua at December 31, 2012 were the complexity of the ore, the variation of ore grade and the high manganese content.~~

~~(6)~~(3)

The metallurgical recovery factors that impacted the calculated reserves for Orcopampa at December 31, ~~2012~~2015 were water quality (recycled water contains impurities that can interfere with the chemical reaction of the reagents) and ore grade being lower than estimated or ~~expected ore grade.~~expected.

~~(7)~~(4)

The metallurgical recovery factors that impacted the calculated reserves for ~~Recuperada~~Uchucchacua at December 31, ~~2012~~2015 were the complexity of the ore, the variation of head ore grades and the high ~~variation in~~manganese content.

(5)

The metallurgical recovery factors that impacted the calculated reserves for Julcani at December 31, 2015 were when the ore ~~grade~~contained iron sulfide (Pyrite) higher than 8% and the quality of ~~water.~~water used in the processing plant.

~~(8)~~(6)

The metallurgical recovery factors that impacted the calculated reserves for Mallay at December 31, ~~2012~~2015 were the high variation in ore grade and the variation in the hardness of the host rocks.

(7)

The metallurgical recovery factors that impacted the calculated reserves for Tambomayo at December 31, 2015 were the complex process to treat polymetallic ore and the variation in the hardness of the host rocks.

(8)

The metallurgical recovery factors that impacted the calculated reserves for Antapite at December 31, 2015 were the high variation in ore grade and the quality of water used in process plant.

(9)

The metallurgical recovery factors that impacted the calculated reserves for Breapampa at December 31, 2015 were the clay content in ore higher than 10% and the iron sulfide (Pyrite) content in ore higher than 3%.

(10)

The reserves shown for La Zanja, in which we owned a 53.06% of equity interest at December 31, 2015, are the total reserves of the mine and do not indicate our equity share. The metallurgical recovery factors that impacted the calculated reserves were when the clay content in ore being higher than 10% and the copper presence in the ore.

(11)

The reserves shown for Tantahuatay, in which we own a 40.10% of equity interest at December 31, 2015, are the total reserves for the mine and do not indicate our equity share. The metallurgical recovery factors that impacted the calculated reserves were when the clay content in ore being higher than 10% and the iron sulfide (Pyrite) content in ore being higher than 3%.

(12)

El Brocal, in which we ~~owned a 53.76%~~own 54.07% controlling equity interest at December 31, ~~2012,~~2015, owns the Colquijirca and Marcapunta mines. The reserves shown for Colquijirca and Marcapunta are the total reserves of the ~~Colquijirca and Marcapunta~~ mines and do not indicate our equity share. They were calculated using the following metal prices: US$1,400 per ounce of gold, US$30 per ounce of silver, US$2,028 per metric ton of zinc, US$2,000 per metric ton of lead and US$6,600 per metric ton of copper.shareholdings.

~~(10)~~(13)

The metallurgical recovery factors that impacted the calculated reserves for Colquijirca at December 31, ~~2012~~2015 were the high content of clay, and soluble salts in the ore.

~~(11)~~(14)

The metallurgical recovery factors that impacted the calculated reserves for Marcapunta at December 31, ~~2012~~2015 were the high content of arsenic in the ore and the hardness of the host rocks.

~~(12)~~

~~The metallurgical recovery factors that impacted the calculated reserves for Antapite at December 31, 2012 were the high variation in ore grade and the quality of water.~~

~~(13)~~

~~The metallurgical recovery factors that impacted the calculated reserves for Shila-Paula at December 31, 2012 was the high variation in ore grade.~~

~~(14)~~

~~The metallurgical recovery factors that impacts the calculated reserves for Poracota at December 31, 2012 were the high variation of the ore grade and the presence of coal content in the ore.~~

~~(15)~~

The metallurgical recovery factors that impacted the calculated reserves for Breapampa at December 31, 2012 were the clay content in ore being higher than 10% and the iron sulfide (Pirite) content in ore being higher than 3%.

~~(16)~~

The reserves shown for Tantahuatay, in which we owned a 40% of equity interest at December 31, 2012, are the total reserves for the mine and do not indicate our equity share. They were calculated using the following prices: US$1,200 per ounce of gold and US$ 22.0 per ounce of silver. The metallurgical recovery factors that impacted the calculated reserves were the clay content in ore being higher than 10% and the iron sulfide (Pirite) content in ore being higher than 3%.

~~(17)~~

The reserves shown for La Zanja, in which we owned a 53.06% of equity interest at December 31, 2012, are the total reserves of the mine and do not indicate our equity share. They were calculated using the following metal prices: US$1,400 per ounce of gold and US$ 30 per ounce of silver. The metallurgical recovery factors that impacted the calculated reserves were the clay content in ore being higher than 10% and the high copper content in the ore.

We operate ten underground mines and four open pit mines. The following table sets forth the aggregate amount of production of ore, gold and silver and the average grade of gold and silver for each of our fourteen mines for the ten-year period ended December 31, 2012, calculated in each case on the basis of 100 percent of the relevant mine’s production.

Julcani Uchucchacua Orcopampa(1) Recuperada Mallay Colquijirca(2)(6) Marcapunta(2) Ishihuinca Antapite Shila -
Paula(3) Poracota Breapampa(6) Tantahuatay(4) (6) La Zanja(5) (6) Total
Ore mined (ST) 957,120 9,239,911 4,693,309 682,640 114,166 16,397,908 5,690,763 368,511 1,611,585 634,734 1,124,909 579,115 14,845,347 23,821,022 80,761,040
Gold produced (oz.) 6,942 - 2,612,923 - 107 - 31,300 125,096 611,405 250,031 242,563 8,817 187,432 290,304 4,366,920
Average gold grade (oz./ST) 0.011 - 0.556 - 0.011 - 0.012 0.402 0.399 0.416 0.262 0.028 0.017 0.021 0.059
Silver produced (oz.) 16,266,407 101,784,006 1,458,349 3,718,219 682,708 42,636,134 2,379,792 - 667,609 2,278,745 130,660 17,212 1,179,416 788,047 173,987,304
Average silver grade (oz./ST) 18.25 14.97 0.30 5.79 6.65 3.71 0.75 - 0.60 4.36 0.15 0.50 0.52 0.31 3.05

~~(1)~~

~~Includes a cumulative total of 116,146 ounces of gold and 587,961 ounces of silver from final tail treatment.~~

~~(2)~~

El Brocal, in which we own a 53.76 % controlling equity interest as of December 31, 2012, owns the Colquijirca and Marcapunta mines. The production data shown for Colquijirca and Marcapunta are the total production data of the Colquijirca and Marcapunta mines and do not indicate our equity share.

~~(3)~~

~~Includes a cumulative total of 701 ounces of gold and 48,677 ounces of silver from metallurgical test treatments to ore from the Tambomayo mine.~~

~~(4)~~

~~The production data shown for Tantahuatay, in which we own a 40.0 % controlling equity interest, are the total production data of the mine and do not indicate our equity share.~~

~~(5)~~

~~The production data shown for La Zanja, in which we own a 53.06 % controlling equity interest, are the total production data of the mine and do not indicate our equity share.~~

~~(6)~~

~~Colquijirca, Breapampa, Tantahuatay and La Zanja are open pit mines.~~

Financial liabilities are classified, at initial recognition, as financial liabilities at fair value through profit or loss, accounts payable, financial obligations, or as derivatives designated as hedging instruments -

~~El Brocal subsidiary uses derivative instruments to manage its exposure to changes~~ in ~~metals prices. In order to manage special risks, El Brocal applies~~an effective hedge, ~~accounting for those transactions that meet the specific criteria applicable.~~

At the inception date of the hedge relation, El Brocal formally documents the relationship between the item hedged and the hedging instrument, including the nature of the risk, the objective and the strategy to be taken to carry out the hedging, and the method to be used to estimate the effectiveness of the hedge relation.

A formal assessment is made upon beginning the hedge relation, to assure that the hedging instrument is highly effective in offsetting the risk designated in the item hedged. Hedges are formally assessed every half. A hedge is considered as ~~highly effective if it is expected that the changes in cash flow attributed to the risk hedged during the period for which the hedge is designated are offset within a range from 80 to 125 percent.~~appropriate.

All ~~the hedges maintained by the Company classifies as cash flow hedges, as consequence, any gain or loss from the effective portion of the hedging instrument is~~financial liabilities are recognized initially ~~recognized~~at fair value and, in the ~~consolidated statement~~case of ~~changes in shareholders’ equity in the “Other reserves~~interest-bearing loans and borrowings and payables, net of ~~equity” caption. Any gain or loss from the ineffective portion of the hedging instrument is initially recognized in~~directly attributable transaction costs.

The Group’s financial liabilities include trade and other payables, financial obligations, derivatives financial instruments and embedded derivatives.

Notes to the consolidated ~~income statement in the “Interest expenses” caption. Amounts recognized~~financial statements(continued)

The measurement of financial liabilities depends on their classification, as ~~equity transaction are transferred to the income statement when the hedge transaction affects~~described below:

Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial recognition as ~~when a forecast sale occurs and is posted~~at fair value through profit or loss.

Financial liabilities are classified as held for trading if they are incurred for the purpose of repurchasing in the ~~“Net sales” caption of~~near term. This category also includes derivative financial instruments entered into by the ~~consolidated income statement.~~

As of December 31, 2011, El Brocal subsidiary had contracted derivative instruments on metals quotes under the Asian swap and collar option modes that qualify as cash-flow hedging instruments. As of December 31, 2012, El Brocal does not have hedging financial instruments.

~~Derivative instruments~~Group that are not designated as hedging instruments in hedge relationships as defined by IAS 39. Separated embedded derivatives are also classified as ~~current~~held for trading unless they are designated as effective hedging instruments.

Gains or ~~non-current,~~losses on liabilities held for trading are recognized in the consolidated statements of profit or loss.

Except for the embedded derivative for concentrate sales, the Group has not designated any financial liability in this category.

After initial recognition, interest-bearing loans and borrowing are ~~separated~~subsequently measured at amortized cost using the effective interest rate method. Gains and losses are recognized in the consolidated statements of profit and cost when the liabilities are derecognized as well as through the amortization process.

Amortized cost is calculated taking into ~~a current~~account any discount or premium on acquisition and ~~a non-current portion based on~~fees or costs that are an ~~assessment~~integral part of the ~~facts~~effective interest rate. Amortization under the effective interest rate method is included as financial costs in the consolidated statements of profit or loss.

A financial liability is derecognized when the obligation under the liability is discharged or cancelled, or expires.

When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and ~~circumstances (for example,~~ the ~~underlying cash flows).~~recognition of a new liability. The difference in the respective carrying amounts is recognized in the consolidated statements of profit or loss.

Financial assets and financial liabilities are offset and the net amount is reported in the consolidated statements of financial position if there is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, to realize the assets and settle the liabilities simultaneously.

Cash and cash equivalents in the consolidated statements of financial position comprise cash at banks and on hand.

~~Embedded derivatives that~~For the purpose of the consolidated statements of cash flows, cash and cash equivalents consist of cash and short term deposits with a maturity of three months or less, which are subject to an insignificant risk of changes in value.

Cost is determined using the average method. In the case of finished goods and work in progress, cost includes the cost of materials and direct labor and a portion of indirect manufacturing expenses, excluding borrowing costs.

The current portion of the inventories is determined based on the expect amounts to be processed within the next twelve months. Inventories not ~~closely related~~expected to be processed within the ~~main contract~~next twelve months are classified ~~consistently with the cash flows of the host contract.~~as long-term.

~~Derivative instruments designated as hedging instruments are classified~~Net realizable value is the estimated selling price in ~~accordance with~~ the ~~classification~~ordinary course of business, less estimated costs of completion and the ~~underlying element hedged. The derivative instrument is separated into a current and a non-current portion only if a reliable allocation can be made.~~estimated costs to make the sale.

~~As of December 31, 2012,~~Provision (reversal) for losses on the ~~Company has not have instruments that qualify as hedging. As of December 31, 2011,~~net realizable value are calculated based on a specific analysis conducted annually by the ~~Company held those instruments (see note 27)~~Management and is charged to income in the period in which it determines the need for the provision (reversal).

Business combinations are accounted for using the acquisition method. The cost of an acquisition is measured as the aggregate of the consideration transferred measured at acquisition date fair value and the amount of any non-controlling interest in the acquiree. For each business combination, the Group elects whether to measure the non-controlling interests in the acquiree at fair value or at the proportionate share of the acquiree’s identifiable net assets. Acquisition-related costs are expensed as incurred and included in administrative expenses.

When the Group acquires a business, it assesses the financial assets and liabilities assumed for appropriate classification and designation in accordance with the contractual terms, economic circumstances and pertinent conditions as at the acquisition date. This includes the separation of embedded derivatives in host contracts by the acquiree.

If the business combination is achieved in stages, any previously held equity interest is re-measured at its acquisition date fair value and any resulting gain or loss is recognized in profit or loss.

Any contingent consideration to be transferred by the acquirer will be recognized at fair value at the acquisition date. Contingent consideration classified as an asset or liability that is a financial instrument and within the scope of IAS 39 Financial Instruments: Classification and Measurement, is measured at fair value, with changes in fair value recognized in either profit or loss or as a change to other comprehensive income. If the contingent consideration is not within the scope of IAS 39, it is measured in accordance with the appropriate IFRS. Contingent consideration that is classified as equity is not re-measured and subsequent settlement is accounted for within equity.

Goodwill is initially measured at cost, being the excess of the aggregate of the consideration transferred and the amount recognized for non-controlling interests, and any previous interests held, over the net identifiable assets acquired and liabilities assumed. If the fair value of the net assets acquired is in excess of the aggregate consideration transferred, the Group re-assesses whether it has correctly identified again all of the assets acquired and all of the liabilities assumed and reviews the procedures used to measure the amounts to be recognized at the acquisition date. If the re-assessment still results in an excess of the fair value of net assets acquired over the aggregate consideration transferred, then the gain is recognized in profit of loss.

After initial recognition, goodwill is measured at cost less any accumulated impairment losses. For the purpose of impairment testing, this difference is allocate to each of the Group’s cash-generating units that are expected to benefit from the combination, irrespective of whether other assets or liabilities, of the acquiree, are assigned to those units.

Where goodwill has been allocated to a cash-generating unit and part of the operation within that unit is disposed of, the goodwill associated with the disposed operation is included in the carrying amount of the operation when determining the gain or loss on disposal. Goodwill disposed of in these circumstances is measured based on the relative values of the disposed operation and the portion of the cash-generating unit retained.

An associate is an entity over which the Group has significant influence. Significant influence is the power to participate in the financial and operating policy decisions of the investee, but is not control over those policies. The Group's investments in associates are accounted for using the equity method. Under this method, the investment in an associate is initially recognized at cost.

The carrying amount of the investment is adjusted to recognize changes in the Group's share of net assets of the associate since the acquisition date. Goodwill relating to the associate is included in the carrying amount of the investment and is not tested for impairment individually.

The consolidated statement of profit or loss reflects the Group’s share of the results of operations of the associate.

Any change in other comprehensive income of those investees is presented as part of the Group’s other comprehensive income. In addition, when there has been a change recognized directly in the equity of the associate, the Group recognizes its share of any changes, when applicable, in the consolidated statements of changes in shareholders’ equity. Unrealized gains and losses resulting from transactions between the Group and the associate are eliminated to the extent of the interest in the associate.

The aggregate of the Group´s share of profit or loss of an associate is shown on the face of the consolidated statements of profit or loss outside operating profit and represents profit or loss after tax and non-controlling interests in the subsidiaries of the associates.

The financial statements of the associate are prepared for the same reporting period as the Group. When necessary, adjustments are made to bring the accounting policies in line with those of the Group.

After the application of the equity method, the Group determines whether it is necessary to recognize an impairment loss of its investment in associates. At each reporting date, the Group determines whether there is objective evidence that the investment in the associate is impaired. If there is such evidence, the Group calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value, and then recognizes the loss in the consolidated statements of profit or loss.

Upon loss of significant influence over the associate, the Group measures and recognizes any retained investment at its fair value. Any difference between the carrying amount of the associate upon loss of significant influence and the fair value of the retained investment and proceeds from disposal is recognized in consolidated statements of profit or loss.

Non-monetary assets which represent an entity’s right to receive goods or services are presented as prepaid expenses. The asset is subsequently derecognized when the goods are received and the services are rendered.

Property, plant and equipment is stated at cost, net of accumulated depreciation and accumulated impairment losses, if any.

The initial cost of an asset comprises its purchase price or construction cost, any costs directly attributable to bringing the asset into operation, the initial estimate of the obligation for mine closing and for qualifying assets, borrowing costs. The capitalized value of a finance lease is also included in this caption.

When significant parts of property, plant and equipment are required to be replaced at intervals, the Group depreciates them separately based on their specific useful lives. Also, when a major inspection is performed, its cost is recognized in the carrying amount of plant and equipment as a replacement if the recognition criteria are satisfied. All other maintenance and repair costs are recognized in the consolidated statement of profit or loss as incurred.

In mining units with a long-term useful life, depreciation of assets directly related to the operation of the mine, is calculated using the units-of-production method, which is based on economically recoverable reserves of the mining unit. Other assets related to these mining units are depreciated using the straight-line method with the lives detailed in the next paragraph.

Depreciation of assets in mining units with short useful lives or used for administrative purposes, is calculated using the straight-line method of accounting. The useful lives are the following:

The ~~Company~~residual values, useful lives and methods of depreciation of property, plant and equipment are reviewed at each financial year end, and adjusted prospectively, if appropriate.

An item of property, plant and equipment and any significant part initially recognized is derecognized upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the consolidated statements of profit or loss when the asset is derecognized.

The determination of whether an arrangement is, or contains, a lease is based on the substance of the arrangement at the inception of the lease. The arrangement is, or contains, a lease if fulfillment of the arrangement is dependent on the use of a specific asset or assets and the arrangement conveys a right to use the asset or assets, even if that right is not explicitly specified in an arrangement.

A lease is classified at the inception date as a finance lease or an operating lease. A lease that transfers substantially all the risk and rewards incidental to ownership to the Group is classified as a finance lease. Finance leases are capitalized at the commencement of the lease at the fair value of the leased property or, if lower, at the present value of the minimum lease payments. Lease payments are apportioned between finance charges and reduction of the lease liability so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are recognized in finance costs in the consolidated statements of profit or loss.

A leased asset is depreciated over the useful life of the asset. However, if there is no reasonable certainty that the Group will obtain ownership by the end of the lease term, the asset is depreciated over the shorter of the estimated useful life of the asset and the lease term.

Operating lease payments are recognized as operating expenses in the statements of profit or loss on a straight-line basis over the lease term.

Leases in which the Group does not transfer substantially all the risk and rewards of ownership of an asset are classified as operating leases.

Initial direct cost incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognized over the lease term on the same basis as rental income. Contingent rents are recognized as revenue in the period in which they are earned.

Mining concessions represent ownership of the right of exploration and exploitation to the Group on mining properties contains ore reserves acquired. Mining concessions are stated at cost and are amortized on units of production method, using as the basis of proven and probable reserves. If the Group leaves these concessions, the costs associated are written off in the consolidated statements of profit or loss.

Cost includes the fair value attributable to mineral reserves and the portion of mineral resources considered to be probable of economic extraction at the time of an acquisition.

At end of each year, the Group evaluates if there is any indicator. If any impairment indicator exists, the Group estimates the asset’s recoverable amount.

Mining concessions are presented in the caption of mining concessions, development costs, property, plant and equipment, net.

Exploration costs are expensed as incurred. These costs primarily include materials and fuels used, surveying costs, drilling costs and payments made to the contractors.

When the Group’s Management approves the feasibility of the conceptual study of a project, the costs incurred to develop such property, including additional costs to delineate the ore body and remove impurities it contains, are capitalized as development costs under the caption mining concessions, development costs and property, plant and equipment, net. These costs are amortized when production begins, on the units-of-production basis over the proven and probable reserves.

As part of its mining operations, the Group incurs waste removal costs (stripping costs) during the development and production phases of its mining operations. Stripping costs incurred in the development phase of a mine, before the production phase commences (development stripping), are capitalized as part of the cost of constructing the mine and subsequently amortized over its useful life using units of production method. The capitalization of development stripping costs ceases when the mine starts production.

Stripping costs incurred during the production phase (production stripping costs) are generally considered to create two benefits, being either the production of inventory or improved access to the ore to be mined in the future. Where the benefits are realized in the form of inventory produced in the period, the production stripping costs are accounted for as part of the cost of producing those inventories. Where the benefits are realized in the form of improved access to ore to be mined in the future, the costs are recognized as a non-current asset, referred to as a stripping activity asset, if the following criteria are met:

To identify components of deposit, the Group works closely with the operating personnel to analyze the mine plans. Mostly, an ore body can have several components. The mine plans, and therefore, the identification of components, will vary among mines for a number of reasons.

The stripping activity asset is initially measured at cost, which surges from an accumulation of costs directly incurred during the stripping activity. The production stripping cost is presented within mining concessions, development costs, property, plant and equipment, net in the consolidated statements of financial position.

The production stripping cost is subsequently depreciated using the units of production method over the expected useful life of the component identified of the ore body that has been made more accessible by the activity. This cost is stated at cost less accumulated depreciation and accumulated impairment losses, if any.

Investment properties are measured at cost, net of accumulated depreciation and impairment loss, if any.

Depreciation of the investment properties is determined using the straight-line method with useful life of 20 years.

Investment properties are derecognized either when they have been disposed of or when they are permanently withdrawn from use and no future economic benefit is expected from their disposal. The difference between the net disposal proceeds and the carrying amount of the asset is recognized in profit or loss in the period of derecognition.

Transfers are made to (or from) investment property only when there is a change in use.

For a transfer from investment property to an item of property, plant and equipment, the deemed cost for subsequent accounting is the fair value at the date of change in use. If an item of property, plant and equipment becomes an investment property, the Group accounts for such property in accordance with the policy stated under property, plant and equipment up to the date of change in use.

The Group assesses, at each reporting date, whether there is an indication that an asset may be impaired. If any indication exists, or when annual impairment testing for an asset is required, the Group estimates the asset’s recoverable amount. An asset’s recoverable amount is the higher of an asset’s or cash-generating unit (CGU) fair value less costs of disposal and its value in use. Recoverable amount is determined ~~by each~~for an individual asset, ~~(cash-generating unit) may be impaired.~~

~~A cash-generating unit is~~unless the ~~smallest identifiable group of assets, denominated a mining unit, that generates~~asset does not generate cash inflows ~~from continuing use~~ that are largely independent of ~~the cash inflow generated by~~those from other assets or groups of assets. ~~In order~~When the carrying amount of an asset or CGU exceeds its recoverable amount, the asset is considered impaired and is written down to ~~determine cash-generating units, the Company has determined whether there is an active market for the minerals and metals produced by a mining unit.~~its recoverable amount.

In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. In determining fair value less cost of disposal, recent market transactions are taken into account. If no such transactions can be identified, an appropriate valuation model is used.

Impairment losses of continuing operations, including impairment of inventories, are recognized in the consolidated ~~statement~~statements of ~~income~~profit or loss in ~~those~~ expense categories consistent with the function of the impaired asset.

For assets in general, an assessment is made at each reporting date to determine whether there is an indication that previously recognized impairment losses may no longer exist or have decreased. If such indication exists, the Group estimates the asset’s or CGU’s recoverable amount. A previously recognized impairment loss is reversed only if there has been a change in the ~~estimates~~assumptions used to determine the ~~asset’s~~asset or CGU’s recoverable amount since the last impairment loss was recognized. The ~~increased~~reversal is limited so that the carrying amount ~~cannot~~of the asset does not exceed its recoverable amount, nor exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognized for the asset in prior years. Such reversal is recognized in the consolidated ~~income statement.~~statements of profit or loss.

~~Basic and diluted earnings per~~Senior executives of the Group receive remuneration in the form of share ~~have been calculated based on~~appreciation rights, which can only be settled in cash. For these transactions, the ~~weighted average number~~amount of ~~common and investment shares outstanding~~the liability is estimated at each reporting date until settlement.

The cost of share-based payments program is measured initially at fair value at the grant date using a binomial model. This fair value is expensed over the period until the vesting date with recognition of a corresponding liability. The liability is re-measured to fair value at each reporting date up to, and including the settlement date, with changes in fair value recognized in its consolidated ~~statement~~statements of ~~financial position; treasury shares have been excluded from~~profit or loss.

Provisions are recognized when the ~~calculation. When the number of shares is modified~~Group has a present obligation (legal or constructive) as a result of ~~capitalization~~a past event, it is probable that an outflow of ~~retained earnings, share splits or share grouping,~~resources embodying economic benefits will be required to settle the ~~net income per basic~~obligation and ~~diluted shares is adjusted retroactively for all~~a reliable estimate can be made of the ~~periods reported.~~amount of the obligation. If the ~~change occurs after~~effect of the ~~date~~time value of money is material, provisions are discounted using a current pre-tax rate that reflects, when appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as a finance cost.

When the ~~financial statement are authorized for issue,~~liability is initially recognized, the ~~calculation of net income per basic and diluted share for all~~present value of the ~~reported periods must be~~estimated costs is capitalized by increasing the carrying amount of the related mining assets (property, plant and equipment). Over time, the discounted liability is increased for the change in present value based on discounted rates that reflects current market assessments and the risks specify to the liability, in addition, the capitalized cost is depreciated and/or amortized based on the ~~new number~~useful life of the asset. Any gain or loss resulting from the settlement of the obligation is recorded in the current results.

Changes in the estimated timing of rehabilitation or changes to the estimated future costs are dealt with prospectively by recognizing an adjustment to the rehabilitation liability and a corresponding adjustment to the related asset. Any reduction in the rehabilitation liability and, therefore, any deduction from the asset to which it relates, may not exceed the carrying amount of the asset. If it does, any excess over the carrying amount is taken immediately to the consolidated statements of profit or loss.

If the change in estimate results in an increase in the rehabilitation liability and, therefore, an addition to the carrying value of the asset, the Group considers whether this is an indication of impairment of the asset as a whole, and if so, tests for impairment, in accordance with IAS 36 "Impairment of Assets".

For closed mines, changes to estimated costs are recognized immediately in the consolidated statements of profit or loss.

Own equity instruments that are reacquired (treasury shares) are recognized at cost and deducted from equity. No gain or loss is recognized in profit or loss on the purchase, sale, issue or cancellation of the Group’s own equity instruments. Any difference between the carrying amount and the consideration, if reissued, is recognized as additional capital in equity. The voting rights related to treasury shares ~~see note 25.~~are cancelled for the Group and no dividends on such shares are allocated.

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be reliably measured, regardless of when the payment is being made. Revenue is measured at the fair value of the consideration received or receivable, taking into account contractually defined terms of payment and excluding taxes or duty. The specific recognition criteria described below must also be met before revenue is recognized:

Revenue from sale of concentrates and metals is recognized when the significant risks and rewards of ownership of the goods have passed to the buyer, usually on delivery of the goods.

Contract terms for the Company’s sale of metal in concentrate to customers allow for a price adjustment based on final assay results of the metal in concentrate by the customer to determine the final content. These are referred to as provisional pricing arrangements and are such that the selling price for metal in concentrate is based on prevailing spot prices on a specified future date after shipment to the customer (the quotation period). Adjustments to the sales price occurs based on movements in quoted market prices up to the date of final settlement. The period between provisional invoicing and final settlement can be between one and six months.

Sales contracts for metal in concentrate that have provisional pricing features are considered to contain an embedded derivative, which is required to be separated from the host contract for accounting purposes. The host contract is the sale of metals in concentrate, and the embedded derivative is the forward contract for which the provisional sale is subsequently adjusted with final liquidations. The embedded derivative is originated by the metals prices since the date of issuance of issuance of the provisional liquidation until the date of issuance of the final liquidation.

The embedded derivative, which does not qualify for hedge accounting, is initially recognized at fair value with subsequent changes in the fair value recognized in the consolidated statements of profit or loss until final settlement, and presented as part of net sales. Changes in fair value over the quotation period and up until final settlement are estimated by reference to forward market prices.

For all financial instruments measured at amortized cost, interest income is recorded using the effective interest rate (EIR). EIR is the rate that exactly discounts the estimated future cash payments or receipts over the expected life of the financial instrument or a shorter period, where appropriate, to the net carrying amount of the financial asset or liability. Interest income is included in finance income in the consolidated statements of profit or loss.

The royalty income is recognized in accordance with the accrual method considering the substance of the relevant agreements.

Revenue is recognized when the Group's right to receive the payment is established, which is generally when shareholders approve the dividend.

Revenue is recognized based on the stage of completion of contracts for existing services. The stage of completion is measured by reference to services performed to date as a percentage of total services to be performed by each contract.

Rental income arising from operating leases on investment properties is accounted for on a straight-line basis over the lease term and is included in revenue in the consolidated statement of profit or loss due to its operating nature.

Salaries and wages, bonuses, post-employment benefits and vacations are calculated in accordance with IAS 19, "Employee Benefits" and are calculated in accordance with current Peruvian legislation based on the accrual basis.

The Company recognizes workers’ profit sharing in accordance with IAS 19, “Employees Benefits". Workers' profit sharing is calculated ~~according to~~in accordance with the Peruvian law ~~in force at today~~ (Legislative Decree No. 892) ~~over~~, and the ~~same taxable net basis used to calculate the income tax. For the Company’s case, the workers’ profit sharing~~applicable rate is 8% over the taxable net base of current year. According to Peruvian ~~Law~~law, the limit in the ~~workers’~~workers' profit sharing that an employee ~~would~~can receive is equivalent to 18 ~~monthly wages. According to the article 3~~months of ~~Law No. 28756 (and its regulation law), it has been established that~~wages, and any excess ~~amounts~~ above such limit ~~will~~has be transferred to the Regional Government and “National ~~Found~~Fund for Employment’s Promotion and ~~Training~~Training” (“FONDOEMPLEO”~~, by its Spanish acronym)”~~). ~~Such funds are used for workers training, employment promotion and public investment projects.~~ The ~~excess amount is retained and paid by the Company to the Peruvian government entities (FONDO EMPLEO and regional government).~~

~~The Company recognizes the current portion of~~Company’s workers’ profit sharing ~~paid directly to them according to~~is recognized as a liability in the ~~IAS 19 “Employees Benefits” approach, considering them~~statement of financial position and as ~~benefits are all forms~~an operating expense in the statements of consideration given by an entity in exchange for service rendered by employees. As a consequence, the Company recognized the workers’ profit sharing as cost or expenses, according to their duties or function.comprehensive income.

In the periods in which the excess over the 18 wages limit arises, the Company considers this as part to the contributions made by the Company to the Government (FONDOEMPLEO) related to the workers’ profit sharing. This is classified as operating expenses in the consolidated income statement.

~~(w)~~

~~Segments –~~

An operating segment is a component of an entity: (i) that engages in business activities from which it may earn revenues and incur expenses (including revenues and expenses relating to transactions with other components of the same entity), (ii) whose operating results are regularly reviewed by the Company´s Management to make decisions about resources to be allocated to the segment and assess its performance, and (iii) for which discrete financial information is available. See note 26.

~~As of December 31, 2012, the Company made the following reclassifications in its consolidated financial statements for the year ended on December 31, 2011:~~

Costs directly attributable to the acquisition, construction or production of a qualifying asset are capitalized as finance part of the cost of an asset. A qualifying asset is one whose value is greater than US$5 million and requires a longer period to 12 months to get ready for its intended use. All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that the Group incurs in connection with the borrowing of funds.

Current income tax assets and liabilities are measured at the amount expected to be recovered from or paid or the tax authority. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted, at the reporting period.

Current income tax relating to items recognized directly in equity is recognized in equity and not in the consolidated statements of profit or loss. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.

Deferred income tax is provided using the liability method on temporary differences between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes at the reporting date.

Deferred income tax liabilities are recognized for all taxable temporary differences, except for taxable temporary differences associated with investments in associates, when the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.

Deferred income tax assets are recognized for all deductible temporary differences, the carry forward of unused tax credits and any unused tax losses. Deferred tax assets are recognized to the extent that is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilized.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred tax asset to be utilized. Unrecognized deferred tax assets are re-assessed at each reporting date and are recognized to the extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the year when the asset is realized or the liability is settled, based on tax rates and tax laws that have been enacted or substantively enacted at the reporting date.

Deferred tax items are recognized in correlation to the underlying transaction either in other comprehensive income or directly in equity.

Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right to compensate current tax assets against current income tax liabilities and the deferred taxes relate to the same taxable entity and the same taxation authority.

Mining royalties and special mining tax are accounted for in accordance with IAS 12 “Income Tax” because they have the characteristics of an income tax. This is considered to be the case when they are imposed under government authority and the amount payable is based on taxable income-rather than physical quantities produced or as a percentage of revenue-after adjustment for temporary differences. Legal rules and rates used to calculate the amounts payable are those in effect on the date of the consolidated statements of financial position.

Therefore, obligations arising from Mining Royalties and Special Mining Tax are recognized as income tax under the scope of IAS 12. Both, Mining Royalties and Special Mining Tax generated deferred assets and liabilities which must be measured using the average rates expected to apply to operating profit in the quarter in which the Group expects to reverse temporary differences.

The net amount of sales tax recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the consolidated statements of financial position.

The Group measures its financial instruments, such as, derivatives and embedded derivatives, at fair value at the date of the consolidated statements of financial position.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either:

~~Improvements and interpretations issued as of December 31, 2012, include the following:~~

~~There were no new standards and interpretations that were applicable to the Company for 2012.~~

The Group uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

IAS 28, Investments in associates and joint ventures (revised in 2011), effective for annual periods beginning on January 1, 2013. As a consequence of the new IFRS 11 and IFRS 12, IAS 28 Investments in Associates and Joint Ventures, describes the application of the equity method to investments in joint ventures in addition to associates.

All assets and liabilities for which fair value is measured or disclosed in the consolidated financial statements are categorized within the fair value hierarchy, described, as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

For assets and liabilities that are recognized in the consolidated financial statements on a recurring basis, the Group determines whether transfers have occurred between levels in the hierarchy by reassessing categorization (based on the lowest-level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

The Group's Management determines the policies and procedures for both recurring fair value measurement and non-recurring measurement. At each reporting date, the Group's Management analyzes the movements in the values of assets and liabilities which are required to be re-measured or re-assessed as per the Group’s accounting policies.

For the purpose of fair value disclosures, the Group has determined classes of assets and liabilities based on the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.

The Group uses derivative instruments to hedge its commodity price risk (forward commodity contracts) and its foreign exchange risk (forward exchange rate contracts). Such derivative financial instruments are initially recognized at fair value on the date on which a derivative contract is entered into and are subsequently re-measured at fair value. Derivatives are carried as financial assets when the fair value is positive and as financial liabilities when the fair value is negative.

At the inception of the hedge relationship, the Group formally designates and documents the hedge relationship to which it wishes to apply hedge accounting and the risk management objective and strategy for undertaking the hedge.

The documentation includes identification of the hedging instrument, the hedge item or transaction, the nature of the risk being hedged and how the entity will assess the effectiveness of changes in the hedging instrument’s fair value in offsetting the exposure to changes in cash flows attributable to the hedged risk. Such hedges are expected to be highly effective in achieving offsetting changes in cash flows and are assessed on an ongoing basis to determine that they actually have been highly effective throughout the financial reporting periods for which they were designated.

The Group’s hedge is classified as cash flow hedge. The effective portion of gain or loss on the hedging instrument is initially recognized in the consolidated statements of changes in equity, under the caption other equity reserves, while the ineffective portion is recognized immediately in the consolidated statements of profit or loss in the finance costs caption.

The Group classifies disposal groups as held for sale if their carrying amounts will be recovered principally through sale rather than through continuing use. Such disposal groups classified as held for sale are measured at the lower of their carrying amount and fair value less costs to sell.

The criteria for held for sale classification is regarded as met only when the sale is highly probable and the disposal group is available for immediate sale in its present condition. Actions required to ~~IFRS (issued~~complete the sale should indicate that it is unlikely that significant changes to the plan will be made or that the sale will be withdrawn. Management must be committed to the sale expected within one year from the date of the classification.

An extension of the period required to complete a sale does not preclude an asset (or disposal group) from being classified as held for sale if the delay is caused by events or circumstances beyond the entity’s control and there is sufficient evidence that the entity remains committed to its plan to sell the asset.

Property, plant and equipment are not depreciated or amortized once classified as held for sale.

Assets and liabilities classified as held for sale are presented separately as current items in ~~May 2012) -~~the consolidated statement of financial position.

A disposal group qualifies as discontinued operation if it is a component of an entity that either has been disposed of, or is classified as held for sale, and:

Discontinued operations are excluded from the results of continuing operations and are presented as a single amount as profit or loss after tax from discontinued operations in the consolidated statement of profit or loss.

Additional disclosures are provided in Note 1(e). All other notes to the consolidated financial statements include amounts for continuing operations, unless otherwise mentioned.

The preparation of the Group’s consolidated financial statements requires Management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. The estimates and assumptions are continuously evaluated and based on Management´s experience and other facts, including the expectations about future events which are reasonable under current situation. Uncertainty about these estimates and assumptions could result in outcomes that require material adjustment to the carrying amount of assets and liabilities affected in future periods. Further information on each of these areas and how they impact the various accounting policies are described below and also in the relevant notes to the consolidated financial statements.

In the process of applying the Group’s accounting policies, Management has made the following judgments, which have the most significant effect on the amounts recognized in the consolidated financial statements:

By their nature, contingencies will be resolved only when one or more uncertain future events occur or fail to occur. The assessment of the existence and potential quantum of contingencies inherently involves the exercise of significant judgment and the use of estimates regarding the outcome of future events.

The Group assesses the status of each exploration project of its mining units to determine when the development phase begins. One of the criteria used to evaluate the development start date is when the Group determines that the property can be economically developed.

The Group assesses the stage of each mine under development to determine when a mine moves into the production phase. The criteria used to assess the start date are determined based on the unique nature of each mining project, such as the complexity of the project and its location. The Group considers various relevant criteria to assess when the production phase is considered to have commenced. Some of the criteria used to identify the production start date include, but are not limited to:

When a mine development /construction project moves into the production phase, the capitalization of certain mine development costs ceases and costs are either regarded as forming part of the cost of inventory or expensed, except for costs that qualify for capitalization relating to mining asset additions or improvements. It is also at this point that depreciation or amortization commences.

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Group based its assumptions and estimates on parameters available when the consolidated financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market change or circumstances arising beyond the control of the Group. Such changes are reflected in the assumptions when they occur.

The Group calculates its reserves using methods generally applied by mining and industry according to international guidelines. All estimated reserves represent estimated quantities of mineral proven and probable that under current conditions can be economically and legally processed.

The process of estimating quantities of reserves is complex and requires making subjective decisions when evaluating all geological, geophysical, engineering and economic information available choices. Reviews could occur on reserve estimates due to, among others, revisions to the data or geological assumptions, changes in prices, production costs and results of exploration activities. Changes in estimated reserves could mainly affect the carrying value of mining concessions, development costs and property, plant and equipment; the charges in result for depreciation and amortization; and the carrying amount of the provision for closure of mining units.

Estimated economically recoverable reserves are used in determining the depreciation and/or amortization of mine-specific assets.

This results in a depreciation/amortization charge proportional to the depletion of the anticipated remaining life-of-mine production. The life of each item, which is assessed at least annually, has regard to both its physical life limitations and present assessments of economically recoverable reserves of the mine property at which the asset is located. These calculations require the use of estimates and assumptions, including the amount of recoverable reserves. Changes in estimates are accounted for prospectively.

The Group assesses its mine rehabilitation provision at each reporting date. The ultimate rehabilitation costs are uncertain, and cost estimates can vary in response to many factors, including estimates of the extent and costs of rehabilitation activities, technological changes, regulatory changes, cost increases as compared to the inflation rates, and changes in discount rates. These uncertainties may result in future actual expenditure differing from the amounts currently provided. The provision at reporting date represents Management’s best estimate of the present value of the future rehabilitation costs required.

Inventories are classified in short and long term in accordance with the time that Management estimates will start the production of the concentrate extracted from the mining unit.

Net realizable value tests are performed at each reporting date and represent the estimated future sales price of the product the entity expects to realize when the product is processed and sold, less estimated costs to complete production and bring the product to sale.

The Group assesses each asset or cash generating unit in each reporting period to determine whether any indication of impairment exists. Where an indicator of impairment exists, a formal estimate of the recoverable amount is made, which is considered to be the higher of the fair value less costs of disposal and value in use. The assessments require the use of estimates and assumptions such as long-term commodity prices, discount rates, operating costs, among others. These estimates and assumptions are subject to risk and uncertainty.

The fair value of mining assets is generally calculated by the present value of future cash flows arising from the continued use of the asset, which include some estimates, such as the cost of future expansion plans, using assumptions that a third party might consider. The future cash flows are discounted to their present value using a discount rate that reflects current market assessment of the value of money over time, as well as specific risks of the asset or cash-generating unit under evaluation.

The Group has determined the operations of each mining unit as a single cash generating unit.

Deferred tax assets are recognized for unused tax losses to the extent that it is probable that taxable profit will be available against which the losses can be utilized. Significant Management judgment is required to determine the amount of deferred tax assets that can be recognized, based upon the likely timing and the level of future taxable profits together with future tax planning strategies.

The contingent consideration arising from a business combination is measured at fair value at the date of acquisition, as part of the business combination. If the contingent consideration is eligible to be recognized as a financial liability the fair value is subsequently re-measured at each date of the consolidated financial statements. Determining the fair value of the contingent consideration is based on a model of discounted future cash flows. The key assumptions take into account the likelihood of achieving each goal of financial performance as well as the discount factor.

The relevant standards and interpretations that are issued, but not yet effective, up to the date of issuance of the Group’s financial statements are disclosed below. The Group intends to adopt these standards, if applicable, when they become effective.

In July 2014, the IASB issued the final version of IFRS 9 Financial Instruments which reflects all phases of the financial instruments project and replaces IAS 39 and all previous versions of IFRS 9. IFRS 9 brings together all three aspects of the accounting for financial instruments project: classification and measurement, impairment and hedge accounting. IFRS 9 is effective for annual periods beginning on or after January 1, 2018, with early application permitted. Except for hedge accounting, retrospective application is required, but the provision of comparative information is not compulsory. For hedge accounting, the requirements are generally applied prospectively, with some limited exceptions.

The adoption of IFRS 9 would have not significant effect on the classification and measurement of the Group’s financial assets and liabilities.

IFRS 15 was issued in May 2014 and establishes a new five-step model that will apply to revenue arising from contracts with customers. Under IFRS 15, revenue is recognized at an amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring goods or services to a customer. The principles in IFRS 15 provide a more structured approach to measuring and recognizing revenue. The new revenue standard is applicable to all entities and will supersede all current revenue recognition requirements under IFRS. Either a full retrospective application or a modified retrospective application is required for annual periods beginning on or after January 1, 2018. Early adoption is permitted. The Group is currently assessing the impact of IFRS 15 and plans to adopt the new standard on the required effective date.

Amendments to IFRS 10 and IAS 28: Sale or Contribution of Assets between an Investor and its Associate or Joint Venture

The amendments address the conflict between IFRS 10 Consolidated Financial Statements and IAS 28 in dealing with the loss of control of a subsidiary that is sold or contributed to an associate or joint venture. The amendments clarify that the gain or loss resulting from the sale or contribution of assets that constitute a business, as defined in IFRS 3, between an investor and its associate or joint venture, is recognized in full. Any gain or loss resulting from the sale or contribution of assets that do not constitute a business, however, is recognized only to the extent of unrelated investors’ interests in the associate or joint venture. These amendments must be applied prospectively and are effective for annual periods beginning on or after January 1, ~~2013.~~

~~Although Management does not believe~~2016, with early adoption permitted. These amendments will impact the ~~new pronouncements will have a significant impact on~~Group to the ~~Company, Management is~~extent that it undertakes future transactions of this nature, as this accounting approach differs to that which it would currently ~~evaluating their impact, if any, on the Company’s consolidated financial statements for 2013.~~apply.

On August 18, 2014, Buenaventura acquired from Minera Gold Fields Peru S.A. (“Gold Fields”) 51% of the voting shares of Canteras del Hallazgo S.A.C., which represent the whole interest of Gold Fields in the equity of such entity.

Canteras del Hallazgo is a privately-held entity incorporated in 2009 and owner of the Chucapaca project, which is located in the Ichuña district, in the General Sanchez Cerro province, in the Moquegua department, Peru. According to previously performed studies, there is evidence of the existence of gold, silver, copper and antimony in the area, specifically in the Canahuire deposit.

Moreover, the Group recognized a gain of US$59,852,000 in the 2014 consolidated statement of profit or loss as a result of re-measuring the previously held equity interest (US$40,094,000) at its acquisition date fair value (US$99,946,000) in accordance with IFRS 3.

The fair values of the identifiable assets and liabilities assumed of Canteras del Hallazgo S.A.C. as at the date of acquisition were:

The purchase and sale agreement considered a contingent consideration of US$23,026,000, which corresponds to the present value of the future royalty payments equivalent to 1.5% over the future sales of the minerals arising from the mining properties acquired. The fair value has been determined using the income approach. Significant unobservable valuation inputs are provided below:

Significant increase (decrease) in the future sales of mineral would result in higher (lower) fair value of the contingent consideration liability, while significant increase (decrease) in the discount rate would result in lower (higher) fair value of the liability. Changes in the fair value of this contingent consideration have been recognized through profit or loss in the consolidated statement of profit or loss.

As of December 31, 2015, it is highly probable that the Group reaches the projected future sales. The fair value of the contingent consideration determined as of December 31, 2015 reflects this assumption and changes in metal prices. A reconciliation of fair value measurement of the contingent consideration liability is provided below:

The Group has the preferential right of acquisition of the royalty in case Gold Fields decides to sell it.

On September 22, 2014, the General Shareholders’ meeting of the Company approved the merger of the Company (absorbing entity) and its subsidiary Canteras del Hallazgo S.A.C. (absorbed entity) effective December 3, 2014.

The statement of profit or loss of Canteras del Hallazgo S.A.C. for the eleven-month period ended December 3, 2014 is a follows:

Transactions in ~~Nuevos~~ Soles are completed using exchange rates published by the Superintendent of Banks, Insurance and AFP. As of December 31, ~~2012,~~2015, the exchange rates for U.S. dollars published by this Institution were US$~~0.3923~~0.2934 for buying and US$~~0.3920~~0.2930 for selling (US$~~0.3711~~0.3355 for buying and US$~~0.3708~~0.3346 for selling as of December 31, ~~2011)~~2014) and have been applied by the Group for the assets and liabilities accounts, respectively.

As of December 31, ~~2012~~2015 and ~~2011,~~2014, the ~~Company~~Group had the following assets and liabilities denominated in ~~Nuevos~~ Soles:

~~(a) The table below presents the components of this caption:~~This caption is made up as follows:

As of December 31, 2015, time deposits were kept in prime financial institutions, which generated interest at annual market rates and had original maturities of less than 90 days, according to the immediate cash needs of the Group.

~~The table below presents the components of time deposits as of December 31, 2011:~~

Buenaventura’s Management decided to invest the excess cash in mutual funds of variable income, which had been designated as financial assets at fair value through profit or loss. According to note 2.3.(b), the Company recorded in the year 2012 an increase in the net investment amounted to US$2,331,000 (US$2,024,000 in the year 2011), to profit and loss to take this investment at fair value as of December 31, 2012. The table below presents the components of this caption:

~~This fund is comprised by a portfolio of investments issued by Peruvian Government and financial entities with high reputation in the local market. The outcome of the investment is variable.~~

~~The accounts receivable are denominated in U.S. dollars, have current maturities, do not accrue interest, have no specific guarantees and are unsecured.~~

In the process of estimating the allowance for doubtful accounts, the Company’s Management constantly evaluates market conditions, for which it uses analysis of aging and risk-rating reports for commercial operations.

2012 2011
US$(000) US$(000)

Classified mineral (c) 69,149 62,052
Leach platform (d) 35,885 19,646
Ore cyanidation process 21,044 14,956
Activated coal (e) 16,269 21,541
Current mineral 4,344 18,748
Other 1,842 3,832

148,533 140,775
Less non-current position (e) (55,937 ) (48,845 )

Current position 92,596 91,930

As part of the mining unit preparation to extract and treat mineral to a 18,000 DMT/per day, El Brocal´s Management decided to accumulate the material with metal content in stock nearby to Tajo Norte in order to be treated when the expansion operation plant, which is estimated to be in the first semester of 2013.

El Brocal´s Management assessed the recoverability of its inventories in process based on the cash flow projections obtained by the production and sale of the different minerals. As of December 31, 2012 and 2011 Management has a plan to treat mineral in stock when the expansion operation plan finish, mentioned before, including the future costs of treatment and finishing, based on this plan these products will be recovery through trading.

Products in process include mineral deposits located in the Tajo Norte mining unit. The detail of this mineral as of December 31, 2015 and 2014 is presented below:

As part of the preparation of the mining unit to extract and process ore at a volume of 18,000 DMT/ day, Management of El Brocal decided to accumulate mineral with metal content in the proximity of the Tajo Norte mine, which has been treated since the first quarter of 2015.

In the opinion of ~~Company’s~~Group’s Management, the provision for impairment of value of inventory adequately covers this risk as of the date of the consolidated ~~statement~~statements of financial position.

Yanacocha issues financial statements under Generally Accepted Accounting Principles in Peru and also under U.S. GAAP for its parent. There were no significant differences between US GAAP and Peruvian GAAP for Yanacocha.

As part of the adoption to IFRS, in 2011, the Company assessed the significant differences in Yanacocha´s financial statements between U.S. GAAP and IFRS and prepared a reconciliation of equity net as of December 31, 2012, 2011 and 2010 and the net income in the years 2012, 2011 and 2010 prepared under U.S. GAAP and IFRS in order to calculate its investment and participation under IFRS in Yanacocha to these dates.

~~The table below presents the principal amounts under U.S. GAAP as of December 31, 2012, 2011 and 2010.~~

The table below presents the reconciliation of the shareholders´ equity prepared under U.S. GAAP with those prepared under IFRS prepared by the Company´s Management as of December 31, 2012 and 2011, and net income as of December 31, 2012, 2011 and 2010:

~~The table below presents the principal amounts in Cerro Verde as of December 31, 2012, 2011 and 2010 under IFRS.~~

On July 17, 2012, Cerro Verde subscribed a new Agreement of Guarantees and Measures to Promote Investments with the Government of Peru, under the General Mining Law and in connection with the Expansion of operations program. This new agreement will enable the Cerro Verde’s Management to establish a tax system for the expansion and according to the management’s option; it will be in force in 2014. According to this agreement, from the time it is in force, the new income tax rate will be 32 per cent.

Compañía Minera Coimolache S.A. (hereafter “Coimolache”) is located in the province of Hualgayoc, which includes the districts of Hualgayoc and Chugur in Cajamarca region and has reserves of 528,000 ounces of gold (unaudited). Coimolache started operations in the third quarter of 2011. As December 31, 2012, the production amounted to 139,253 ounces of gold and 914,779 ounces of silver (50,916 ounces of gold and 298,674 ounces of silver as of December 31, 2011).

~~The table below presents the main figures audited from financial statements of Coimolache, restructured according to Buenaventura’s accounting practices:~~

~~The mining project is located in Moquegua. There are evidences of gold, copper and silver in Chucapaca project zone, at Canahuire deposit.~~

As of December 31, 2012, the project is in Feasibility and Environmental Studies, which are expected to be concluded at the end of 2013 and it continues with exploration works in order to dimension the magnitude of mining field. Based on investment program agreed with the other shareholder, the Company disbursed contributions which allow the project development. As of December 31, 2012, Buenaventura’s contribution amounted to US$153,303,000 (US$97,820,000 as of December 31, 2011).

~~The table below presents the main figures audited from financial statements of Canteras del Hallazgo, restructured according to Buenaventura’s accounting practices:~~

Investments held by the Group in its associates Minera Yanacocha S.R.L. (through its subsidiary Compañía Minera Condesa S.A.) and Sociedad Minera Cerro Verde S.A.A., represent the most significant investments of the Group. Its operations are strategic to the Group's activities and participation in their results has been important in relation to profits (losses) of the Group in the years 2015, 2014 and 2013. The following relevant information on these investments is as follows:

The Company, through its subsidiary Compañía Minera Condesa S.A., has an interest of 43.65% of Yanacocha. Yanacocha is engaged in gold production and exploration and development of gold and copper in its own concessions or owned by S.R.M.L. Chaupiloma Dos de Cajamarca, with which it signed a contract for use of mineral rights.

During the last several years, Yanacocha has been developing the Conga project, which consists of two deposits of gold and porphyry of copper located at northeast of the Yanacocha operating area in the provinces of Celendín, Cajamarca and Hualgayoc (Peru).

Because of local communities and political protests for potential water impacts of the project development activities and construction the projects are suspended since November 2011. To date, Yanacocha’s management has been making only water support activities recommended by independent experts, mainly the construction of water reservoirs, before carrying out any development project.

The table below presents key financial data from the financial statements of Yanacocha under IFRS:

During the years 2014 and 2013, Yanacocha recorded impairment charges of its long-lived assets, net of tax, of US$378,799,000 and US$726,984,000, respectively, which reduced Yanacocha´s net equity and, therefore, the equity participation of the Group in this associate in those years. These impairment losses mainly resulted from the postponement of the development activities due to the serious difficulties to get the social license to operate the Conga project.

In December 2015, Yanacocha recorded charges for deferred income tax recoverability by US$510,000,000 since Management considers it improbable that taxable profit will be available to compensate against the deductible temporary differences.

In February 2016, the Committee agreed unanimously the distribution to the partners, in proportion to its social share, of US$ 300 million, which correspond to the portion of the retained earnings as of December 31, 2014, originated in 2011.

Cerro Verde is engaged in the extraction, production and marketing of cathodes and copper concentrate from its mining unit that is located in Uchumayo, Arequipa, Peru.

The table below presents the key financial data from the financial statements of Cerro Verde under IFRS:

As of December 31, 2015 and 2014, total market capitalization of 68,555,000 shares maintained by the Group in Cerro Verde was US$994,047,000 and US$1,645,319,000, respectively (market capitalization value of US$14.50 and US$24.00 per unit, respectively).

Coimolache is involved in the production and the sales of gold and silver from its open-pit mining unit located in Cajamarca, Peru.

The table below presents the key financial data from the financial statements of Coimolache under IFRS:

~~The table below presents the movement of the cost and accumulated amortization of the mining concessions for mining units:~~

~~The table below presents the movement of the cost, accumulated amortization and provision for impairment:~~

The carrying value of plant and equipment held under finance leases contracts as of December 31, 2012 was US$119,000,000 (US$105,042,000 as of December 31, 2011). Additions of leasing during the year include US$13,958,000 (US$50,915,000 in 2011) and are disclosed in “Works in progress” caption. Leased assets contracts are pledged as security for the related finance lease.

~~The table below presents the components and movement of the reversal for impairment of long-lived assets:~~

As a result of the decrease in the level and quality of the reserves in some mining units, during the year 2012, the Company’s Management updated its assessment of the recoverability of the book value of its long-lived assets. The provision made in the year 2012 amounts to US$3,617,000.

Assessing the impairment of long-lived assets involves comparing their respective carrying amount with their recoverable values. The recoverable value of assets is the greater of its fair value less the costs of sale or its value in use. The recoverable amount used in assessing the Antapite, Recuperada and Poracota mining unit is the fair value. The Company estimated the use value of its long-lived assets using a discounted cash-flow model. Cash flow was projected for the useful life of the mining units based on Management’s expectations. This useful life depends on several variables, including the mineral reserves of each unit.

~~In the opinion of the Company’s Management, the provision for impairment of long-lived assets covers the risk of impairment at the date of the consolidated statement of financial position.~~

In the case of Yanacocha (investment held through its subsidiary Compañía Minera Condesa S.A.) the Company’s Management concluded that there was no objective evidence of impairment as of the consolidated statement of financial position date derived from internal and external indicators (rising trend in the international price of gold, constant level of reserves and an increase in the annual net profit reported). In addition, in the case of associate Cerro Verde, the Company’s Management compared the investment’s fair value according to market capitalization with the investment’s book value, and determined that there was no impairment as of the consolidated statement of financial position date. On the other hand, in the case of Coimolache, and Canteras del Hallazgo, the Company´s Management concluded that there was no objective evidence of impairment as of the consolidated statement of financial position date derived from internal and external indicators. See notes 9(f)
~~and (g).~~

Trade accounts payable arise mainly from the acquisition of material, supplies and spare parts and services provided by third parties. These obligations are mostly denominated in U.S. dollars, have current maturities, do not accrue interest and no specific guarantees have been granted for these obligations. Trade accounts payable amount to US$199,551,000 as of December 31, 2012 (US$142,375,000 as of December 31, 2011).

In accordance with its accounting policies and processes, each asset or CGU is evaluated annually at year end to determine whether there are any indications of impairment. If any such indications of impairment exist, a formal estimate of the recoverable amount is performed.

In assessing whether impairment is required, the carrying value of the asset or CGU is compared with its recoverable amount. The recoverable amount is the higher of the CGU’s fair value less costs of disposal (FVLCD) and value in use (VIU). Given the nature of the Group’s activities, information on the fair value of an asset is usually difficult to obtain unless negotiations with potential purchasers or similar transactions are taking place. Consequently, the recoverable amount for each CGU is estimated based on discounted future estimated cash flows expected to be generated from the continued use of the CGUs using market based commodity price and exchange assumptions, estimated quantities of recoverable minerals, production levels, operating costs and capital requirements, and its eventual disposal, based on the latest life of mine (LOM) plans. These cash flows were discounted using a real pre-tax discount rate that reflected current market assessments of the time value of money and the risks specific to the CGU.

The estimates of quantities of recoverable minerals, production levels, operating costs and capital requirements are obtained from the planning process, including the LOM plans, one-year budgets and CGU-specific studies.

As a result of the recoverable amount analysis performed during the year, the Group recognized impairment losses related to mine properties forUS$11,255,000,in relation to La Zanja andBreapampamining units.

The determination of value in use is most sensitive to the following key assumptions:

Production volumes: Estimated production volumes are based on detailed life-of-mine plans and take into account development plans for the mines agreed by management as part of planning process. Production volumes are dependent on a number of variables, such as: the recoverable quantities; the production profile; the cost of the development of the infrastructure necessary to extract the reserves; the production costs; the contractual duration of mining rights; and the selling price of the commodities extracted.

As each producing mining unit has specific reserve characteristics and economic circumstances, the cash flows of the mines are computed using appropriate individual economic models and key assumptions established by management. The production profiles used were consistent with the reserves and resource volumes approved as part of the Group’s process for the estimation of proved and probable reserves and resource estimates.

Commodity prices: Forecast commodity prices are based on management’s estimates and are derived from forward price curves and long-term views of global supply and demand, building on past experience of the industry and consistent with external sources. These prices were adjusted to arrive at appropriate consistent price assumptions for the different qualities and type of commodities, or, where appropriate, contracted prices were applied. These prices are reviewed at least annually.

Estimates prices for the current and long-term periods that have been used to estimate future revenues are as follows:

Discount rate: In calculating the value in use, a pre-tax discount rate of 10.03% was applied to the pre-tax cash flows. This discount rate is derived from the Group’s post-tax weighted average cost of capital (WACC), with appropriate adjustments made to reflect the risks specific to the CGU. The WACC takes into account both debt and equity. The cost of equity is derived from the expected return on investment by the Group’s investors. The cost of debt is based on its interest bearing borrowings the Group is obliged to service. The beta factors are evaluated annually based on publicly available market data.

The Group's investment properties consist of administrative offices in seven floors (6,252 meters square), 154 parking spaces and 20 tanks, all in the building “Capital El Derby”, located in the district of Surco, Lima, Peru.

The movement of cost and accumulated depreciation for the years 2015 and 2014 is presented below:

The Group does not have restrictions in the realization of its investment properties.

During 2015, the fair value of the investment property amounted to US$22,583,000 and the rental income from these investment properties amounted to US$1,670,000.

~~The table below presents~~As of December 31, 2015, the ~~components~~Group maintains bank loans amounting to US$285,302,000, which were obtained for working capital purposes, have current maturity and accrue interest at market annual rates ranging from 1.32% to 5.61% (as of ~~this caption:~~December 31, 2014, the Group held a loan of US$40,000,000, which accrued interest an annual rate of 1.5%).

2012 2011
US$(000) US$(000)
Less – Non current portion
Provision for closure of mining units and exploration projects (a) (77,665 ) (59,132 )
Stock appreciation rights (b) (22,203 ) (26,457 )
Provision for environmental liabilities (173 ) (939 )
(100,041 ) (86,528 )

Current portion 71,780 91,287

The table below presents the movement of the provision for closure of mining units and exploration projects:

~~F-66~~

Notes to the consolidated financial statements(continued)

	~~US$(000)~~

~~Changes in estimates (property, plant and equipment and development costs)~~		~~24,812~~
~~New mine closure plans (property, plant, equipment and development costs)~~		~~8,897~~
~~Changes in estimates (income)~~		~~(512~~	)
~~Increase for accretion expense of the present value of the provision~~		~~6,812~~

~~Balance as of December 31, 2012~~		~~99,438~~

The provision for closure of mining units and exploration projects represents the present value of the closure costs that are expected to be incurred between the years ~~2013~~2016 and ~~2027. Estimates of the costs for closure of mining units~~2040. These estimates are based on studies prepared by independent advisers that meet the environmental regulations in effect.

The provision for closure of mining units and exploration projects corresponds mostly to activities that must be carried out for restoring the mining units and areas affected by operation and production activities. The principal works to be performed correspond to earthworks, re-vegetation efforts and dismantling of the plants. Closure budgets are reviewed regularly to take into account any significant change in the studies conducted. Nevertheless, the closure costs of mining units will depend on the market prices for the closure works required, which would reflect future economic conditions. Also, the time when the disbursements will be made depends on the useful life of the mine, which will be based on future metals prices.

As of December 31, ~~2012,~~2015, the future value of the provision for closure of mining units and exploration projects wasUS$~~181,250,000,~~ 212,362,000,which has been discounted using ~~the~~ annual risk-free ~~rate 4.07 percent,~~rates ranging from 0.72%to5.21% in periods of 1 to24years, resulting in an updated liability ofUS$~~99,438,000~~166,403,000 (US$~~127,492,000 which has been discounted using the annual risk-free rate 4.87 percent, resulting in an updated liability of US$81,914,000~~ 103,010,000as of December 31, ~~2011)~~2014). The ~~Company~~Group believes that this liability is sufficient to meet the current environmental protection laws approved by the Ministry of Energy and Mines.

~~During 2012 and 2011~~As of December 31, 2015, the Group has constituted letters of credit in favor of the Ministry of Energy and Mines ~~has approved the following~~forUS$110,403,000(US$76,808,000 as of December 31, 2014) to secure mine closure ~~plans:~~plans of its mining units.

~~Project name~~	~~Resolution Number~~	~~Approval date~~

~~Julcani mining unit (*)~~	~~R.D. N°046-2011-MEM-AAM~~	~~February 11, 2011~~
~~Administrative Economic Unit Esperanza 2001 (*)~~	~~R.D. N°027-2011-MEM-AAM /~~ ~~R.D. N°264-2011-MEM-AAM~~	~~January 27, 2011 /~~ ~~August 19, 2011~~

~~F-67~~

F-57

Notes to the consolidated financial statements(continued)

~~Project name~~	~~Resolution Number~~	~~Approval date~~
~~Orcopampa mining unit (*)~~	~~R.D. N°283-2011-MEM- AAM~~	~~September 9, 2011~~
~~Poracota mining unit (*)~~	~~R.D.N°104-2011-MEM-AAM~~	~~April 8, 2011~~
~~Angelica Rubio Chico Project~~	~~R.D.N°371-2011-MEM-AAM~~	~~April 6, 2011~~
~~Angelica Rulo project~~	~~R.D.N°111-2011-MEM-AAM~~	~~April 12, 2011~~
~~Trocancha Anchaca project~~	~~R.D.N °168-2011-MEM-AAM~~	~~June 2, 2011~~
~~Pucarumi project~~	~~R.D.N°297-2011-MEM-AAM~~	~~September 26, 2011~~
~~Breapampa mining unit~~	~~R.D.N°237-2012-MEM-AAM~~	~~July 17, 2012~~
~~Colquijirca mining unit (*)~~	~~R.D.N°243-2012-MEM~~	~~August 17, 2012~~

~~(*) Change to the initial plan.~~

~~The Company has constituted letters of credit to Ministry of Energy and Mines for US$46,608,000 (US$39,511,000 as of December 31, 2011) to secure mine closure plans for the above-mentioned units.~~

~~(b)~~

~~Workers´profit sharing -~~

Legislative Decree N° 892 (L.D. 892), issued in 1996 and which regulates the right of workers to participate in the company’s profits that performs activities generating third categories income, requires companies domiciled in Peru to compute and pay to employees, a share of the profits generated by the companies for which they work.

The worker’ profit sharing is recognized as labor costs in the “Cost of sales, without considering depreciation and amortization” or “Administrative expense” of the consolidated financial statement according to the duties or function of the workers.

According to indicated to note 2.3.(v), the workers’ profit sharing is paid until a limit of 18 wages. The excess is retained by the Company and this is paid to Peruvian Government entities (FONDOEMPLEO and regional government). During the year 2012, the excess between the total amounts of workers’ profit sharing calculated in accordance to L.D. 892 and the limit to pay to employees amounts to US$2,164,000 as of December 31, 2012 (US$6,221,000 as of December 31, 2011), which will be transferred to FONDOEMPLEO within the period established by law. Based on the Company’s accounting policy, such excess is show as operating expenses in the consolidated statement of comprehensive income.

~~The following table presents the movement of the workers´profit sharing:~~

	~~US$(000)~~

~~Balance as of January 1, 2011~~		~~21,442~~

~~Payments~~		~~(21,329~~	)
~~Changes in estimates~~		~~39,044~~

~~F-68~~

~~Notes to the consolidated financial statements (continued)~~

	~~US$(000)~~

~~Balance as of December 31, 2011~~		~~39,157~~
~~Payments~~		~~(34,014~~	)
~~Changes in estimates~~		~~23,284~~

~~Balance as of December 31, 2012~~		~~28,427~~

~~(c)~~

~~Stock Appreciation Rights -~~

Senior executives of the Company are granted share appreciation rights, which can only be settled in cash, if the executive is working for the Company at each program’s settlement date. These programs are mainly structured in a ten-year term, allocated in several programs with progressive maturities. The settlement of each program is determined based on the variation of the market prices at the maturity date as compared to the price at the date of the grant, over the corresponding number of shares.

~~The table below presents the principal assumptions used by the Company to estimate the fair value:~~

2012 2011

Historical volatility 48.38 % 49.50 %
Risk-free interest rate for the remaining period until vesting 0.16 % 0.00 %
Dividend yield 1.25 % 1.21 %
Period covered by the program 10 years 10 years
Market value of the shares at closing US$ 35.95 US$ 38.34

The expected life of the options is based on historical and recent expectations, and does not necessarily represent patterns that indicate the executions of options that could occur. The expected volatility reflects the assumption that the historical volatility for a period similar life of the options indicates the trend in the future, which may not necessarily be the end result.

~~The valuation model used by the Company as of December 31, 2012 and 2011 was Turnbull & Wakeman.~~

~~F-69~~

~~Notes to the consolidated financial statements (continued)~~

~~The table below presents the movement of the shares subject to the compensation program for the years 2012 and 2011:~~

Number of shares
2012 2011

Opening balance 3,593,733 3,133,250
Granted during the year 790,000 775,000
Retired during the year (82,000 ) (30,000 )
Expired during the year (332,069 ) (284,517 )

Ending balance 3,969,664 3,593,733

~~The payment obligations of shares subject to the compensation program per year are: 454,686 in 2013; 602,532 in 2014; 728,031 in 2015; 611,115 in 2016 and 1,573,300 thereafter.~~

~~The average real prices for the programs granted and expiring in the months of January 2013 and 2012 were US$34.86 and US$40.04 per share, respectively.~~

~~The table below presents the movement of the stock appreciation rights for the years 2012, 2011 and 2010:~~

2012 2011 2010
US$(000) US$(000) US$(000)

Opening balance 43,188 69,380 41,131
Valuation (reverse) of the year 1,799 (5,693 ) 42,425
Payments made during the year (16,729 ) (20,499 ) (14,176 )
28,258 43,188 69,380

Less - non-current portion (22,203 ) (26,457 ) (49,170 )

Current portion 6,055 16,731 20,210

~~F-70~~

~~Notes to the consolidated financial statements (continued)~~

~~15.~~17.

Financial obligations

(a)

~~The table below presents the detail of financial obligations:~~This caption is made up as ~~of December 31, 2012 and 2011.~~follow:

Original
amount Period Guarantee Annual interest rate Maturities 2012 2011
US$(000) US$(000) US$(000)

Empresa de Generación Huanza S.A.
Banco de Credito del Peru - Leasing (c) 119,000 10 years Leased equipment Three-month Libor plus 4.00% (4.306% as of December 31, 2012 and 4.581% as of December 31, 2011) Quarterly maturities to during seven years from capitalization 119,000 105,042
Sociedad Minera El Brocal S.A.A.
Banco de Credito del Peru - Loan (b) 120,000 4 years None Three-month Libor plus 3% (3.32% as of December 31, 2012) Quarterly maturities US$2,812 and a payment of US$45,000 at the end of the loan 60,000 -

Leasing 329 2 years Leased equipment 4.60% Monthly maturities of US$13,569 from August 2012 to July 2014 257 -

Consorcio Energético de Huancavelica S.A.
BBVA Banco Continental - Working Capital Loan 10,000 4 years None Three-month Libor plus 1.25% Quarterly maturities of US$500,000 from September 2007 to June 2012 - 1,000

Other minor 47 72
179,304 106,114

Non-current portion (173,489 ) (105,072 )

Current portion 5,815 1,042

	2015		2014
	US$(000)		US$(000)

Empresa de Generación Huanza S.A.
Banco de Crédito del Perú – Finance lease (b)		188,138		199,170

Sociedad Minera El Brocal S.A.A.
Banco de Crédito del Perú – Leaseback (c)		156,328		165,039
Other obligations		-		5,000

Buenaventura Ingenieros S.A.
Banco de Crédito del Perú – Finance lease (d)		9,082		13,988
Other obligations		69		-

Contacto Corredores de Seguros S.A.
BBVA Banco Continental S.A. – Finance lease		93		108

Total financial obligations		353,710		383,305

Classification by maturity:
Current portion		33,394		69,950
Non-current portion		320,316		313,355

Total financial obligations		353,710		383,305

(b)

On ~~September 28, 2012, El Brocal subscribed~~December 2, 2009, Empresa de Generación Huanza S.A. entered into a ~~medium-term loan~~finance lease contract with Banco de ~~Credito~~Crédito del ~~Peru amounted to US$120,000,000; which was approved by El Brocal ´s Board of Directors on April 23, 2012,~~Perú, with the following terms and conditions:

~~F-71~~

Principal: US$119,000,000.

Annual interest rate: Three-month Libor plus 4.00%.

Term: 6 years since August 2014, with final maturity in November 2020.

Guarantee: Leased equipment.

Amortization: Through 26 quarterly variable installments and a final installment of US$44,191,000.

On June 30, 2014, Banco de Credito del Perú extended the finance lease contract above mentioned, through the addition of a new tranche with the following terms and conditions:

Principal: US$108,780,000.

Annual interest rate: Three-month Libor plus 4.20%.

Term: 6 years since August 2014, with final maturity in November 2020.

Guarantee: Leased equipment.

Amortization: Through an initial installment of US$23,780,000, 26 quarterly variable installments and a final installment of US$68,905,000.

F-58

Notes to the consolidated financial statements(continued)

(c)

On June 9, 2015, the Board of Directors of El Brocal approved the modification of the sale and finance leaseback contract, with the following terms and conditions:

~~Capital:~~Principal: US$~~120,000,000.~~166,500,000.

~~Term and annual~~Annual interest rate: ~~4 years with a variable rate (Three-month~~Three-month Libor plus ~~3 points)~~4.75%.

Term: 5.5 years since June 23, 2015, with final maturity in year 2020.

Amortization: Through 22 quarterly variable installments.

The financing is secured by the fixed assets leased (equipment, machinery and processing plant located in the Colquijirca mining unit) and by a trust agreement on receivables, sales contracts and cash inflows on commercial contracts.

In connection with the above financing, El Brocal complied with the following financial ratios since the third quarter of 2015:

(i)

Debt service coverage ratio: Higher than 1.3.

(ii)

Leverage ratio: Less than 1.0.

(ii)

Debt ratio:

(a)

Less than 3.00 times as of December 31, 2015;

(b)

Less than 2.75 times from January 1, 2016 to September 30, 2016;

(c)

Less than 2.50 times as of December 31, 2016;

(d)

Less than 2.50 times from January 1, 2017 to September 30, 2017;

(e)

Less than 2.25 times as of December 31, 2017;

(f)

Less than 2.00 times since January 1, 2018.

The compliance with the financial ratios described above is monitored by El Brocal’s management. In 2015, Management obtained a waiver for any possible breach of the financial ratios until December 31, 2016.

(d)

On March 28, 2014, Buenaventura Ingenieros S.A. entered into a finance lease contract with Banco de Credito del Perú, for the construction of administrative offices, with the following terms and conditions:

Principal: US$14,944,000.

Annual interest rate: 4.60%.

Term: 5 years and 4 months since April 2014, with final maturity in July 2019.

Guarantee: ~~Pledge of 2 contract of sale of concentrate, one of copper and another of lead.~~Leased property.

Amortization: ~~Quarterly constant maturities and a final payment~~Through 64 monthly installments of ~~25 percent of capital.~~US$208,000 each.

~~Availability of the loan period: Until May 2013.~~

At the same time to obtain the loan described above, El Brocal Management obtained 3 bridge loans amounted to US$44,000,000 in the form of simple notes, which were disbursed on July 18, September 19, and November 14, 2012. The rate for these loans was signed by the same initial loan of US$120,000,000 (three-month Libor + 3 percent, equivalent to 3.32 percent at December 31, 2012). These notes were cancelled in November of 2012 with the first disbursement of US$60,000,000.

The interest expenses related to this loan as of December 31, 2012 amounted to US$334,000, which have been capitalized in “Mining concessions, development costs and property, plant and equipment, net” caption.

~~F-72~~

F-59

Notes to the consolidated financial statements(continued)

~~(c)~~

On December 2, 2010 Banco de Credito (hereinafter “the Bank”) executed a financial lease agreement with Consorcio Energético Huancavelica S.A., Empresa de Generación Huanza S.A. and Compañía de Minas Buenaventura S.A.A. for construction of a hydroelectric power station. This financial lease for US$119,000,000 is in favor of Empresa de Generación Huanza S.A. (hereinafter “the Lessee”). This agreement stipulates that Buenaventura commits itself as a joint surety of the Lessee, guaranteeing fulfillment of the pecuniary obligations in favor of the bank. As of December 31, 2012, the total disbursement made by the bank amounted to US$119,000,000 (US$105,042,000 as of December 31, 2011).

~~(d)~~(e)

The financial obligations held by ~~Buenaventura and its subsidiaries~~the Group mature as follows:

Year 2012 2011
US$(000) US$(000)

2012 - 1,042
2013 5,815 15,025
2014 28,364 15,017
2015 thereafter 145,125 75,030
179,304 106,114

Current portion (5,815 ) (1,042 )

Non-current portion 173,489 105,072

Year	2015		2014
	US$(000)		US$(000)

2016		-		47,673
2017		40,104		58,406
2018		41,708		60,113
2019		44,956		16,659
2020		193,548		130,504

		320,316		313,355

~~16.~~18.

Shareholders’ equity, net

(a)

Capital stock -

The ~~Company’s~~Group’s share capital is stated in ~~Nuevos~~ Soles (S/.) and consists of common shares with voting rights, ~~that represent 100 percent~~with a nominal amount of ~~the Company’s issued capital.~~S/10.00 per share. The table below presents the ~~components~~composition of the capital ~~stock:~~stock as of December 31, 2015 and 2014:

As of December 31, 2012 and 2011
Number of
shares Capital
stock Capital
stock
S/.(000) US$(000)

Common shares 274,889,924 2,748,899 813,162
Treasury shares (21,130,260 ) (211,303 ) (62,622 )
253,759,664 2,537,596 750,540

~~F-73~~

~~Notes to the consolidated financial statements (continued)~~

	Number of shares			Capital stock			Capital stock
				S/(000)			US$(000)

Common shares		274,889,924			2,748,899			813,162
Treasury shares		(21,174,734	)		(211,747	)		(62,665	)

		253,715,190			2,537,152			750,497

The market value of the common shares amounted to US$~~36.06~~4.28 per share as of December 31, ~~2012~~2015 (US$~~37.78~~10.58 per share as of December 31, ~~2011) and it~~2014). These shares presented a trading frequency of ~~97.61 percent (98.41 percent as of December 31, 2011)~~100% in the year 2015 (100% in the year 2014).

(b)

Investment shares -

Investment shares ~~do not~~ have a nominal value of S/10.00 per share. Holders of investment shares are neither entitled neither to exercise voting rights ornor to participate in shareholders’ ~~meetings but do~~meetings; however, they confer upon the holders thereof the right to participate in the dividends distribution ~~of dividends.~~in the same manner as common shares. The table below presents the ~~components~~composition of the investment ~~shares:~~shares as of December 31, 2015 and 2014:

As of December 31, 2012
Number of
shares Investment
shares Investment
shares
S/.(000) US$(000)

Investment shares 744,640 6,827 2,019
Treasury investment shares (271,733 ) (1,640 ) (620 )
472,907 5,187 1,399

	As of December 31, 2011
	Number of shares			Investment shares			Investment shares			Number of shares			Investment shares			Investment shares
				S/.(000)			US$(000)						S/(000)			US$(000)

Investment shares		744,640			7,446			2,161			744,640			7,447			2,161
Treasury investment shares		(61,976	)		(619	)		(142	)		(272,963	)		(2,730	)		(765	)
		682,664			6,827			2,019
											471,677			4,717			1,396

The market value of the investment shares amounted to US$~~29.41~~4.15 per share as of December 31, ~~2012~~2015 (US$~~37.70~~8.72 per share as of December 31, ~~2011) and it presented~~2014). These shares did not present a trading frequency ~~of 7.57 percent (12 percent as of December 31, 2011).~~in 2015 and 2014.

F-60

Notes to the consolidated financial statements(continued)

(c)

Legal reserve -

The Peruvian Corporations Law (~~Ley General de Sociedades)~~requires that a minimum of ~~ten percent~~10% of the distributable earnings for each period, after deducting the income tax, be transferred to a legal reserve until the latter is equal to ~~20 percent~~20% of the capital stock. This legal reserve can be used to offset losses or may be capitalized, with the obligation, in both cases, to replenish it.

~~For~~Although, the ~~years ending December 31, 2012, 2011 and 2010,~~balance of the legal reserve exceeded the limit mentioned above, the Company ~~had not~~ increased its legal reserve ~~due to its legal reserve reached the limit mentioned before.~~by US$47,000 in 2014.

(d)

Dividends declared and paid -

The table below presents the dividends declared and paid in ~~2012, 2011~~2014 and ~~2010:~~2013:

Meetings	Date	Dividends paid			Dividend per share
		US$(000)			US$
2014 Dividends
Mandatory Annual Shareholders’ Meeting	March 27		3,032			0.01
Board of Directors’ Meeting	October 30		6,339			0.02
Less - Dividends of treasury shares			(729	)

			8,642

2013 Dividends
Mandatory Annual Shareholders’ Meeting	March 26		82,690			0.30
Board of Directors’ Meeting	October 30		2,757			0.01
Less - Dividends of treasury shares			(6,568	)

			78,879

During 2015, no dividends have been declared or paid. According to the current Law, there are no restrictions for the remittance of dividends or repatriation of capital by foreign investors.

(e)

Basic and diluted loss per share -

Loss per share is calculated by dividing net profit for the period by the weighted average number of shares outstanding during the year.

~~F-74~~

F-61

Notes to the consolidated financial statements(continued)

Meeting Date Dividends
declared and
paid Dividend
per share
US$ US$
2012 Dividends
Mandatory Annual Shareholders’ Meeting March 26 110,254,000 0.40
Board of Directors’ Meeting October 30 55,126,000 0.20
Less – Dividends of treasury shares (12,714,000 )
152,666,000
2011 Dividends
Mandatory Annual Shareholders’ Meeting March 25 90,959,000 0.33
Board of Directors’ Meeting October 27 63,396,000 0.23
Less – Dividends of treasury shares (11,867,000 )
142,488,000
2010 Dividends
Mandatory Annual Shareholders’ Meeting March 26 82,690,000 0.30
Board of Directors’ Meeting October 28 44,101,000 0.16
Less – Dividends of treasury shares (9,748,000 )
117,043,000

The ~~effect~~calculation of ~~declared and paid dividends by subsidiaries~~loss per share attributable to ~~non-controlling interest~~the equity holders of the parent is ~~made up as follows:~~presented below:

2012 2011 2010
US$(000) US$(000) US$(000)

Sociedad Minera El Brocal S.A.A. 19,266 17,263 19,383
S.M.R.L. Chaupiloma Dos de Cajamarca 14,820 14,280 3,688
Minera La Zanja S.R.L. 10,795 31,919 -
Inversiones Colquijirca S.A. - 3,274 16,105
44,881 66,736 39,176

	2015			2014			2013

Loss net (numerator) - US$		(317,210,000	)		(76,065,000	)		(107,257,000	)
Total common and investment shares (denominator)		254,186,867			254,186,867			254,186,867

Loss net per basic share and diluted - US$		(1.25	)		(0.30	)		(0.42	)

The calculation of loss per share from continuing operations attributable to the equity holders of the Parent is presented below:

	2015			2014			2013

Loss net (numerator) - US$		(307,687,000	)		(44,951,000	)		(23,372,000	)
Total common and investment shares (denominator)		254,186,867			254,186,867			254,186,867

Loss net per basic share and diluted - US$		(1.21	)		(0.18	)		(0.09	)

Loss per basic and diluted share is the same in both cases, because there are no diluting effects on loss for the years 2015, 2014 and 2013.

There have been no transactions involving ordinary shares or investment between December 31, 2015 and the date of issuance of these consolidated financial statements.

~~17.~~19.

~~Tax Situation~~Subsidiaries with material non-controlling interest

(a)

~~The Company and its~~Financial information of subsidiaries ~~are subject to the Peruvian tax system. As of December 31, 2012, the income tax rate was 30 percent on taxable income.~~that have material non-controlling interest is provided below:

~~Legal entities and individuals not domiciled in Peru are subject to an additional tax of 4.1 percent on the dividends received.~~

~~Through Law N°29666, published on February 20, 2011, it is restored the 16 percent of Value Added Tax being applicable from March 1, 2011.~~

~~Additionally, through Law N°29667, published in the same date, the Financial Transactions Tax is reduced to 0.005 percent, being applicable from April 1, 2011.~~

	Country of incorporation and operation	2015		2014		2013
		%		%		%

Equity interest held by non-controlling interests:
Sociedad Minera El Brocal S.A.A.	Peru		45.93		45.93		45.93
S.M.R.L. Chaupiloma Dos de Cajamarca	Peru		40.00		40.00		40.00
Minera La Zanja S.R.L.	Peru		46.94		46.94		46.94

~~F-75~~

F-62

Notes to the consolidated financial statements(continued)

		2015		2014		2013
		US$(000)		US$(000)		US$(000)
Accumulated balances of material non-controlling interest:
Sociedad Minera El Brocal S.A.A.	Peru		172,542		208,664		190,050
S.M.R.L. Chaupiloma Dos de Cajamarca	Peru		2,357		3,600		2,228
Minera La Zanja S.R.L.	Peru		53,271		85,756		85,029

			228,170		298,020		277,307

Profit (loss) allocated to material non-controlling interest:
Sociedad Minera El Brocal S.A.A.	Peru	(34,991	)	3,450	(3,541	)
S.M.R.L. Chaupiloma Dos de Cajamarca	Peru	9,244		10,250	12,302
Minera La Zanja S.R.L.	Peru	(32,486	)	725	18,760
Apu Coropuna S.R.L.	Peru	(102	)	-	-

		(58,335	)	14,425	27,521

(b)

~~During~~The summarized financial information of these subsidiaries, before inter-company eliminations, is presented below:

Statements of financial position as of December 31, 2015:

	Sociedad Minera El Brocal S.A.A.			S.M.R.L. Chaupiloma Dos de Cajamarca			Minera La Zanja S.R.L.			Total
	US$(000)			US$(000)			US$(000)			US$(000)

Current assets		87,676			9,381			103,540			200,597
Non-current assets		652,197			16			116,792			769,005
Current liabilities		(166,424	)		(3,508	)		(37,030	)		(206,962	)
Non-current liabilities		(197,763	)		-			(69,816	)		(267,579	)

Total shareholders’ equity, net		375,686			5,889			113,486			495,061
Attributable to:
Shareholders of the parent		203,144			3,532			60,215			266,891
Non-controlling interests		172,542			2,357			53,271			228,170

		375,686			5,889			113,486			495,061

F-63

Notes to the consolidated financial statements(continued)

Statements of financial position as of December 31, 2014:

	Sociedad Minera El Brocal S.A.A.			S.M.R.L. Chaupiloma Dos de Cajamarca			Minera La Zanja S.R.L.			Total
	US$(000)			US$(000)			US$(000)			US$(000)

Current assets		110,244			14,657			119,591			244,492
Non-current assets		654,819			70			159,245			814,134
Current liabilities		(152,721	)		(5,727	)		(42,405	)		(200,853	)
Non-current liabilities		(157,996	)		-			(53,742	)		(211,738	)

Total shareholders’ equity, net		454,346			9,000			182,689			646,035
Attributable to:
Shareholders of the parent		245,682			5,400			96,933			348,015
Non-controlling interests		208,664			3,600			85,756			298,020

		454,346			9,000			182,689			646,035

Statements of profit or loss for the year ended December 31, 2015:

	Sociedad Minera El Brocal S.A.A.			S.M.R.L. Chaupiloma Dos de Cajamarca			Minera La Zanja S.R.L.			Total
	US$(000)			US$(000)			US$(000)			US$(000)

Revenues		171,294			32,414			161,007			364,715
Cost of sales		(204,556	)		(54	)		(213,372	)		(417,982	)
Administrative expenses		(19,168	)		(106	)		(2,251	)		(21,525	)
Sales expenses		(9,056	)		-			(1,207	)		(10,263	)
Exploration in non-operating areas		(2,366	)		-			(8,954	)		(11,320	)
Impairment loss of long-lived assets		-			-			(3,803	)		(3,803	)
Other operating expense, net		(2,657	)		-			(687	)		(3,344	)
Finance income		154			-			16			170
Finance costs		(10,096	)		(4	)		(3,684	)		(13,784	)
Net gain (loss) for exchange difference		(3,847	)		45			(1,973	)		(5,775	)
Profit (loss) before income tax		(80,298	)		32,295			(74,908	)		(122,911	)
Income tax		4,109			(9,186	)		5,702			625

Net profit (loss)		(76,189	)		23,109			(69,206	)		(122,286	)

Attributable to non-controlling interests		(34,991	)		9,244			(32,486	)		(58,233	)

Dividends paid to non-controlling interests		-			10,488			-			10,488

F-64

Notes to the consolidated financial statements(continued)

Statements of profit or loss for the year ended December 31, 2014:

	Sociedad Minera El Brocal S.A.A.			S.M.R.L. Chaupiloma Dos de Cajamarca			Minera La Zanja S.R.L.			Total
	US$(000)			US$(000)			US$(000)			US$(000)

Revenues		210,002			36,867			185,286			432,155
Cost of sales		(149,969	)		(74	)		(137,659	)		(287,702	)
Administrative expenses		(17,617	)		(113	)		(5,920	)		(23,650	)
Sales expenses		(7,103	)		-			(1,441	)		(8,544	)
Exploration in non-operating areas		(5,085	)		-			(19,689	)		(24,774	)
Other operating income (expense), net		(50	)		(1	)		(3,389	)		(3,440	)
Finance income		-			-			1			1
Finance costs		(4	)		(3	)		(1,728	)		(1,735	)
Net loss for exchange difference		(1,039	)		(50	)		(1,525	)		(2,614	)
Profit before income tax		29,135			36,626			13,936			79,697
Income tax		(21,621	)		(10,996	)		(12,388	)		(45,005	)

Net profit		7,514			25,630			1,548			34,692

Attributable to non-controlling interests		3,450			10,250			725			14,425

Dividends paid to non-controlling interests		-			8,880			-			8,880

Statements of profit or loss for the year ended December 31, 2013:

	Sociedad Minera El Brocal S.A.A.			S.M.R.L. Chaupiloma Dos de Cajamarca			Minera La Zanja S.R.L.			Total
	US$(000)			US$(000)			US$(000)			US$(000)

Revenues		187,769			44,185			193,298			425,252
Cost of sales		(155,613	)		(112	)		(115,577	)		(271,302	)
Administrative expenses		(15,620	)		(96	)		(2,475	)		(18,191	)
Sales expenses		(8,763	)		-			(528	)		(9,291	)
Exploration in non-operating areas		(5,220	)		-			(3,446	)		(8,666	)
Other operating expense, net		(656	)		(3	)		(55	)		(714	)
Finance income		136			3			37			176
Finance costs		(1,912	)		(5	)		(1,301	)		(3,218	)
Net loss for exchange difference		(2,827	)		(66	)		(777	)		(3,670	)
Profit (loss) before income tax		(2,706	)		43,906			69,176			110,376
Income tax		(5,003	)		(13,151	)		(29,211	)		(47,365	)

Net profit (loss)		(7,709	)		30,755			39,965			63,011

Attributable to non-controlling interests		(3,541	)		12,302			18,760			27,521

Dividends paid to non-controlling interests		2,713			10,820			-			13,533

F-65

Notes to the consolidated financial statements(continued)

Statements of cash flow for the year ended December 31, 2015:

	Sociedad Minera El Brocal S.A.A.			S.M.R.L. Chaupiloma Dos de Cajamarca			Minera La Zanja S.R.L.			Total
	US$(000)			US$(000)			US$(000)			US$(000)

Operating activities		(1,523	)		26,474			30,743			55,694
Investing activities		(28,375	)		-			(26,761	)		(55,136	)
Financing activities		31,867			(26,220	)		-			5,647
Increase in cash and cash equivalents in the year		1,969			254			3,982			6,205

Statements of cash flow for the year ended December 31, 2014:

	Sociedad Minera El Brocal S.A.A.			S.M.R.L. Chaupiloma Dos de Cajamarca			Minera La Zanja S.R.L.			Total
	US$(000)			US$(000)			US$(000)			US$(000)

Operating activities		71,682			22,375			17,075			111,132
Investing activities		(131,045	)		-			(20,452	)		(151,497	)
Financing activities		54,642			(22,200	)		7,000			39,442
Increase (decrease) in cash and cash equivalents in the year		(4,721	)		175			3,623			(923	)

Statements of cash flow for the year ended December 31, 2013:

	Sociedad Minera El Brocal S.A.A.			S.M.R.L. Chaupiloma Dos de Cajamarca			Minera La Zanja S.R.L.			Total
	US$(000)			US$(000)			US$(000)			US$(000)

Operating activities		80,197			34,864			71,621			186,682
Investing activities		(215,758	)		7			15,079			(200,672	)
Financing activities		121,202			(34,450	)		(90,100	)		(3,348	)
Increase (decrease) in cash and cash equivalents in the year		(14,359	)		421			(3,400	)		(17,338	)

F-66

Notes to the consolidated financial statements(continued)

20.

Tax situation

(a)

Current tax regime -

The Company and its Peruvian subsidiaries are subject to the Peruvian tax regime. In 2015, the income tax rate for enterprises is 28% over the taxable income. Non-domiciled companies in Peru or natural persons are affected to a withholding income tax of 4.1% over the dividends received.

By means of Law No. 30296 enacted on December 31, 2014, the Peruvian government introduced certain amendments to the Income Tax Law, effective January 1, 2015. The most relevant are listed below:

There will be a gradual reduction of the ~~four years following the year of filing tax returns the tax authorities have the power to review and, as applicable, correct the~~corporate income tax ~~computed by the Company. The Income Tax~~from 30% to 28% in 2015 and ~~Value Added Tax (“IGV” by its Spanish acronym) returns for the following years are open~~2016; to ~~review by Tax Authorities:~~27% in 2017 and 2018; and to 26% in 2019 and thereafter;

There will be a gradual increase of the withholding income tax to dividends from 4.1% to 6.8% in 2015 and 2016; to 8.0% in 2017 and 2018; and to 9.3% in 2019 and thereafter. These rates will be applicable to the distributed or approved dividends, whichever first occurs, effective January 1, 2015;

The retained earnings or other items that can generate taxable dividends, obtained until December 31, 2014, will be subject to a rate of 4.1%.

(b)

Years open to tax review -

During the four years following the year of filing the tax return, the tax authorities have the power to review and, as applicable, correct the income tax computed by the Group. The Income Tax and Value Added Tax returns for the following years are open to review by the Tax Authorities:

Entity	Years open to review byband Tax Authorities

Compañía de Minas Buenaventura S.A.A.	~~2008, 2009, 2010,~~ 2011 ~~and 2012~~– 2015
Bisa Construcción S.A.	2011 – 2015
Buenaventura Ingenieros S.A.	~~2008, 2009, 2010, 2011 and 2012~~
~~Compañía de Exploraciones, Desarrollo e Inversiones Mineras S.A.C.~~2013 – ~~CEDIMIN~~	~~2010, 2011 and 2012~~2015
Compañía Minera Condesa S.A.	~~2008, 2009, 2010,~~ 2011 ~~and 2012~~– 2015
Compañía Minera Colquirrumi S.A.	~~2008, 2009, 2010,~~ 2011 ~~and 2012~~– 2015
Consorcio Energético de Huancavelica S.A.	~~2008, 2009,~~ 2011 ~~and 2012~~– 2015
Contacto Corredores de Seguros S.A.	~~2008, 2009, 2010,~~ 2011 ~~and 2012~~
~~Inversiones Colquijirca S.A.~~	~~2008, 2009, 2010, 2011 and 2012~~
~~Sociedad Minera El Brocal S.A.A.~~	~~2008, 2009, 2010, 2011 and 2012~~
~~S.M.R.L. Chaupiloma Dos de Cajamarca~~	~~2008, 2010, 2011 and 2012~~
~~Minera La Zanja S.R.L.~~	~~2008, 2009, 2010, 2011 and 2012~~– 2015
El Molle Verde S.A.C.	2011 ~~and 2012~~– 2015
Empresa de Generación Huanza S.A.	~~2008, 2009, 2010,~~ 2011 ~~and~~ – 2015
Inversiones Colquijirca S.A.	2011 – 2015
Minera La Zanja S.R.L. (*)	2013 – 2015
Sociedad Minera El Brocal S.A.A. (**)	2013 – 2015
S.M.R.L. Chaupiloma Dos de Cajamarca	2012 – 2015
Procesadora Industrial ~~Rio~~Río Seco ~~S.A.~~S. A.	~~2010,~~ 2011 ~~and 2012~~– 2015
Apu Coropuna S.R.L.	2013 – 2015
Cerro Hablador S. A. C.	2013 – 2015
Minera Azola S. R. L.	2014 – 2015

Due to the possible interpretations that the Tax Authorities may give to legislation in effect, it is not possible to determine whether or not any of the tax audits that will perform will result in increased liabilities for the Company. For that reason any tax or surcharge that could arise from future tax audits would be applied to the income of the period in which it is determined. In Management’s opinion and its legal advisors, any possible additional payment of taxes in the entities mentioned before would not have a material effect on the consolidated financial statements as of December 31, 2012 and 2011.

~~Buenaventura -~~

Buenaventura’s Income Tax Returns for the 2000 and 2003 periods have been audited by Tax Authorities. As a result of the aforesaid, the Tax Administration has issued assessments denying recognition of Buenaventura’s tax-loss carryforwards reported as of December 31, 2000 and 2003 amounting to S/.71,160,000 (equivalent to US$27,895,000) and S/.18,224,000 (equivalent to US$7,144,000), respectively. In October and November of 2012, the Fiscal Court resolve in favor to the Company the appeal process for the year 2000 and 2003, determining that the dividends should not be considered as taxable for purposes of determining the tax-loss carryforward.

~~F-76~~

F-67

Notes to the consolidated financial statements(continued)

During the year 2007, the Tax Administration audited Buenaventura’s Income Tax Returns for the 2004 and 2005 periods. As a consequence of the aforementioned, the Tax Administration issued assessments denying recognition of some tax deductions by S/.77,921,000 (equivalent to US$30,545,000) in 2004 and S/.119,785,000 (equivalent to US$46,956,000) in 2005. The main objection considered as taxable income the reversal of the provision related to commercial contracts, which in that time were not deducted to calculate Income Tax. To date, the Tax Administration has issued a resolution, on the claim petition filed by the Company, to ratify the assessment made in the audit.

In July 2012, the Fiscal Court resolved the appeal process of the year 2005 determining null the resolution related to the reversal of the provision related to commercial contracts. As of the date of the consolidated financial statement, Tax Administration, through resolution, annulled the main objection of considered as taxable income the reversal of the provision related to commercial contracts, calculating a tax debt for S/.9,384,000 (equivalent to US$3,679,000), including fiscal penalty which were appealed. In Management´s opinion and its legal advisors, the Company should obtain a favorable result in the appeal process that the Company has started against the resolution.

In October 2012, the Fiscal Court resolved the appeal process of the year 2004, determining null the resolution related to the reversal of the provision related to commercial contracts. As of the date of the consolidated financial statement, Tax Administration, through resolution, annulled the main objection of considered as taxable income the reversal of the provision related to commercial contracts, calculating a tax debt for S/.246,000 (equivalent to US$96,000). As of the date of the consolidated financial statement, the debt has been paid.

During the year 2010, the Tax Administration audited Buenaventura’s Income Tax and Value Added Tax for the 2006 period. As a consequence of the aforementioned, the Tax Administration does not recognize some tax deductions made by the Company amounting to S/.184,339,000 (equivalent to US$72,261,000). The main objection considered as taxable income the reversal of the provision related to commercial contracts. Also, the Tax Administration considered the explosive delivery to mining contractors as a transaction subject to Income Tax and Value Added Tax amounting to S/.12,275,000 (equivalent to US$4,812,000). To date, the Tax Administration has issued a resolution, on the claim petition filed by the Company, to ratify the assessment made in the audit.

In July 2012, the Fiscal Court resolved the appeal process of the year 2006, determining null the resolution related to the reversal of the provision related to commercial contracts and annulled the explosive delivery to mining contractors. As of the date of the consolidated financial statement, Tax Administration, through resolution, annulled the main objection of considered as taxable income the reversal of the provision related to commercial contracts, calculating a tax debt for S/.3,314,000 (equivalent to US$1,299,000). As of the date of the consolidated financial statement, the debt has been paid.

~~F-77~~

~~Notes to the consolidated financial statements (continued)~~

The Income Tax declared by the Company for the years 2008 to 2011 and Value Added Tax by the periods from December 2008 and December 2012, are subject to be audited by tax authorities. It is important to mention that currently the Tax Administration is auditing 2007 Income Tax. Furthermore, the Company has been notified by Tax Administration the beginning of the audit of the income tax declare by the Company for the year 2008 and Value Added Tax for the period between January and December 2008, the audit will begin in March 2013.

Due to the possible interpretations that the Tax Authorities may give to legislation in effect, it is not possible to determine whether or not any of the tax audits ~~that will perform~~ will result in increased liabilities for the ~~Company.~~Group. For that reason, any tax or surcharge that could arise from future tax audits would be applied to the income of the period in which it is determined. ~~However, in Management’s~~In management's opinion and its legal advisors, any possible additional payment of taxes in the entities mentioned before would not have a material effect on the consolidated financial statements as of December 31, ~~2012~~2015 and ~~2011.~~

~~Cedimin -~~

Cedimin´s Income Tax Return for the 2002 period has been audited by the Tax Administration. As a result, the Tax Administration has issued assessments modifying the tax-loss carryforward declared by Cedimin. In those periods the principal objection is against having considered Cedimin´s loss of S/.22,041,000 (US$8,640,000) on the sale of Minera Huallanca S.A.C. and Minera Yanaquihua S.A. shares as non-deductible. In the opinion of Cedimin´s Management and its legal advisors, this interpretation has no legal basis, for which reason Cedimin would obtain a favorable result in the tax claim procedure initiated against the above-indicated assessment.

~~Condesa -~~

Condesa´s Income Tax Returns for the 2000, 2001 and 2003 periods have been audited by the Tax Administration. As a result of the aforesaid, the Tax Administration has issued assessments reducing the tax-loss carryforwards from previous years, which Condesa had reported in those periods, by S/.31,338,000 (US$12,285,000). For these periods, the principal objection is against having considered non-taxable income (dividends) as taxable for purposes of determining the tax-loss carryforward.

~~F-78~~

~~Notes to the consolidated financial statements (continued)~~

~~In October 2011, the Fiscal Court issued the resolutions with favourable result to Condesa. Therefore, tax-loss carryforward reported by Condesa is correctly recognized for 2000, 2001 and 2003.~~

~~Sociedad Minera El Brocal S.A.A. -~~

In 2006 the Tax Administration audited El Brocal Income tax return for the 2003 period, determining objections of S/.2,292,018 (equivalent to US$898,478) to net income for the period for under-reporting sales by the improper deduction of freight and insurance on mineral exports, which results in a reduction of the tax-loss carryforwards for the mentioned amount. The penalty resolution issued for this objection amounts to S/.343,803 (equivalent to US$134,772, without penalty interest) and was not accepted by El Brocal, therefore a claim was filed against the penalty. On November 30, 2010, the Tax Administration has issued a resolution No. 0150140009380, which rejected Brocal´s claim. Brocal do not agree with the scope of the resolution and a claim was presented to Fiscal Court on January 10, 2011, in accordance with the deadlines established by the Tax Code.2014.

The ~~Income Tax declared by~~open tax process of the ~~Company for the years 2008 to 2012~~Group and ~~Value Added Tax by the periods from December 2008, January 2010 to December 2012,~~its associates are ~~subject to be audited by tax authorities.~~presented in Note 29 (g).

(c)

As of December 31, 2012 and 2011, the tax-loss carryforward determined by Buenaventura amounts to approximately S/.278,391,000 and S/.595,924,000 respectively (equivalent to US$109,130,000 and US$220,958,000). In November 2010, a restated income tax return was submitted for 2009 which increased the tax-loss carryforward. As allowed by the Income Tax Law, Buenaventura has chosen a system for offsetting this loss with an annual cap equivalent to 50 percent of net future taxable income, until exhausting this amount. The amount of the tax-loss carryforward is subject to the results of the audits mentioned in the previous paragraph (b).Tax-loss carryforwards -

The tax-loss carryforward determined by the Group amounts to approximately S/688,178,000 and S/622,419,000 as of December 31, 2015 and 2014, respectively (equivalent to US$201,634,000 and US$208,237,000 respectively). As permitted by the Income Tax Law, the Group has chosen a system that permits to offset these losses with an annual cap equivalent to 50% of net future taxable income.

~~Buenaventura~~

The Group has decided to recognizea deferred income tax asset ~~insofar as~~related to the tax-loss carryforward,due to there it is more likely than not that the tax-loss carryforward can be used to ~~offset~~compensate future taxable net income. ~~See note 24.~~

(d)

For purposes of determining the Income Tax, the transfer prices for transactions with related companies and companies domiciled in territories with little or no taxation must be substantiated with documentation and information on the valuation methods used and the criteria considered for their determination. Tax Administration can request this information based on analysis of the Company’s operations, the Company’s Management and its legal advisers believe that, as a result of the application of these standards, no material contingencies will arise for the Company as of December 31, 2012 and 2011. In accordance with the Legislative Decree 1116, effective since August 1, 2012, those standards are not applicable to the determination of Value Added Tax.Transfer pricing -

For purposes of determining the Income Tax, the transfer prices for transactions with related companies and companies domiciled in territories with little or no taxation must be supported with documentation and information on the valuation methods used and the criteria considered for their determination. Tax Administration can request this information based on analysis of the Group's operations. The Group’s Management and its legal advisers believe that, as a result of the application of these standards, no material contingencies will arise for the Group as of December 31, 2015 and 2014.

~~F-79~~

F-68

Notes to the consolidated financial statements(continued)

~~(e)~~

As mentioned in the note 2.3.(r) payments to the Government for mining royalties and special mining tax are under the scope of IAS 12, therefore, they are managed as were income tax, see detail in note 24(d).

~~(f)~~

On July 9, 2011, Law No. 29741 was enacted, which created the Supplemental Retirement Mining, Metallurgy and Steel Fund as a social security fund for workers of undertakings included in such sectors. Subsequently, dated May 11, 2012, Supreme Decree No. 006-2012-TR was issued, through which approved the regulations of the Law mentioned above.

According to Article 1 of the Law, the Fund is constituted by the following contributions: (i) 0.5 percent of the annual pre-tax income of mining metallurgical and steel, and (ii) 0.5 percent monthly of gross monthly salary of each worker mining, metallurgical and steel.

~~18.~~21.

Net sales

The Company’s revenues are mostly from sales of gold and precious metals in the form of concentrates, including silver-lead, silver-gold, zinc and lead-gold-copper concentrates and ounces of gold. The table below presents the net sales to customers by geographic region and product type:

(a)

The Group’s revenues are mostly from sales of gold and precious metals in the form of concentrates, including silver-lead, silver-gold, zinc and lead-gold-copper concentrates and ounces of gold. The table below presents the net sales to customers by geographic region and product type:

	2012		2011		2010		2015			2014			2013
	US$(000)		US$(000)		US$(000)		US$(000)			US$(000)			US$(000)

Sales by geographic region
Sales and services by geographic region:
Metal and concentrates sales
America		742,103		710,729		504,648		434,675			531,460			690,224
Peru		556,407		600,147		479,126		348,523			434,958			306,693
Europe		98,085		132,662		35,937		60,549			46,585			70,020
Asia		53,090		8,321		7,944		21,215			54,268			67,978
Africa								-			-			921

		1,449,685		1,451,859		1,027,655		864,962			1,067,271			1,135,836
Services rendered
Peru		46,656		41,225		20,230		50,944			71,642			79,344
America		8		82		-		3,544			-			-
Asia		-		710		-		-			-			241
Europe		-		6		-
								54,488			71,642			79,585
		1,496,349		1,493,882		1,047,885
								919,450			1,138,913			1,215,421

Sales by product:
Gold								438,585			551,132			637,032
Silver								316,692			355,239			362,805
Copper								131,356			271,282			182,399
Zinc								102,110			46,903			71,187
Lead								55,445			39,185			55,951
								1,044,188			1,263,741			1,309,374

Commercial deductions								(196,211	)		(184,483	)		(178,903	)
Adjustments to prior period liquidations								7,506			(6,073	)		(1,437	)
Embedded derivatives from sale of concentrate								(337	)		(9,800	)		6,140
Hedge operations								9,816			3,886			662
								864,962			1,067,271			1,135,836
Services rendered								54,488			71,642			79,585

								919,450			1,138,913			1,215,421

~~F-80~~

F-69

Notes to the consolidated financial statements(continued)

2012 2011 2010
US$(000) US$(000) US$(000)

Sales by product
Gold 738,477 791,387 578,582
Silver 544,947 526,380 274,624
Copper 177,573 193,215 129,444
Zinc 82,873 72,095 92,884
Lead 52,834 36,880 46,913
1,596,704 1,619,957 1,122,447
Deductions (147,930 ) (127,957 ) (112,254 )
Prior-period settlements (15,609 ) 2,429 (4,922 )
1,433,165 1,494,429 1,005,271
Adjustment to open provisional liquidations 14,816 (22,679 ) 6,630
Embedded derivatives from sale of concentrate (a) 1,776 (11,210 ) 13,870
Hedging operations (72 ) (8,681 ) 1,884
1,449,685 1,451,859 1,027,655
Sale of services, power and other minor items 46,664 42,023 20,230

1,496,349 1,493,882 1,047,885

~~(a)~~

~~Embedded derivative for sales of concentrate -~~

Concentrates sales are based on commercial contracts, from which a provisional value based on forward quotation. The sales adjustments are considered an embedded derivative, which is required to be separated from the host commercial contract. Commercial contract are related to the quotation prices (London Metal Exchange). The embedded derivative, which does not qualify for hedge accounting, therefore, changes in the fair value are charge to profit and loss. Final quotations are settled in different months, according to the commercial contracts.

The adjustments to the provisional sale value are recorded as an adjustment in the current net sales. These adjustments resulted in higher sales by US$1,776,000, lower sales by US$11,210,000; and higher sales by US$13,870,000 in 2012, 2011 and 2010, respectively, as a result of the future behavior of metal prices trade by the Company at the cutoff date.

(b)

Concentration of sales -

In ~~2012,~~2015, the ~~three most important~~two customers ~~represented 48, 15 and 8 percent~~with sales of more than 10% of total net sales ~~(58, 21~~represented 66% and ~~6 percent~~22% from the total net sales of ~~total sales in 2011)~~the Group (62% and 17% during the year 2014, 65% and 13% during the year 2013). As of December 31, ~~2012, 68 percent~~2015, 85% of the accounts receivable is related to these customers ~~(86 percent~~(80% as of December 31, ~~2011)~~2014). These clients are related to the mining business.

The ~~Company’s~~Group's sales of gold and concentrates are delivered to investment banks and national and international ~~well known~~well-known companies. ~~See note 28(b).~~ Some of these clients have sales contracts that guarantee supplying them the production from the ~~Company’s~~Group’s mines at prices that are based on market quotations.

~~F-81~~

~~Notes to the consolidated financial statements (continued)~~

~~19.~~22.

~~Costs~~Cost of sales, without considering depreciation and amortization

~~The table below presents the components of this caption:~~

(a)

The cost of sales of goods is made up as follows:

	2012			2011			2010			2015			2014			2013
	US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)

Opening balance of products in process, note 8(a)		140,775			77,441			15,650
Opening balance of finished goods, note 8(a)		19,026			6,750			7,578
		159,801			84,191			23,228

Beginning balance of finished goods and products in process, net of depreciation and amortization											124,810			114,475			129,699
Cost of production
Services provided by third parties		274,100			173,162			167,510			232,043			264,051			241,024
Consumption of materials and supplies		133,983			101,700			86,946			105,144			102,270			107,073
Direct labor		103,828			103,313			76,666			69,710			77,931			75,768
Electricity and water		29,966			35,083			20,890			35,799			33,369			14,454
Cost of concentrate purchase to third parties		18,563			16,917			12,741
Transport		16,389			13,445			10,538			10,261			14,189			7,207
Insurance		11,973			9,658			7,281
Maintenance and repair											9,334			6,572			6,037
Rentals		9,835			24,542			6,697			6,768			6,241			26,516
Maintenance and repair		7,016			5,256			4,441
Provision for impairment of finished goods, note 8(f)		212			383			1,648
Insurances											5,907			7,429			8,303
Cost of concentrate purchased to third parties											-			-			(175	)
Provision for impairment of finished goods and product in progress, Note 9(b)											11,621			1,152			3,931
Other production expenses		43,522			38,314			12,734			7,496			17,529			15,456
		649,387			521,773			408,092

Final balance of products in process, note 8(a)		(148,533	)		(140,775	)		(77,441	)
Final balance of finished goods, note 8(a)		(31,163	)		(19,026	)		(6,750	)
		(179,696	)		(159,801	)		(84,191	)

		629,492			446,163			347,129
Total cost of production of the period											494,083			530,733			505,594
Final balance of products in process and finished goods, net of depreciation and amortization											(81,180	)		(112,156	)		(122,128	)
Cost of sales of goods, without considering depreciation and amortization											537,713			533,052			513,165

F-70

Notes to the consolidated financial statements(continued)

~~20.~~(b)

~~Exploration in operating units~~The cost of services is made up as follows:

~~The table below presents the components of this caption:~~

2012 2011 2010
US$(000) US$(000) US$(000)

Exploration expenses
Orcopampa 49,079 33,391 28,719
Poracota 30,105 18,244 18,390
Uchucchacua 29,306 20,223 16,683
Antapite 12,222 7,271 6,346
Mallay 8,018 - -
Recuperada 7,476 5,847 5,246
Julcani 7,327 6,563 5,105
Shila - Paula 6,371 15,482 10,688
La Zanja 2,517 2,334 264
Breapampa 308 - -
Caraveli 236 - -
Other 53 - -

153,018 109,355 91,441

~~21.~~

~~Royalties~~

~~The table below presents the components of this caption:~~

2012 2011 2010
US$(000) US$(000) US$(000)

Sindicato Minero de Orcopampa S.A., note 30(b) 34,863 31,882 27,572
Peruvian Goverment 2,489 28,222 24,613
Minera El Futuro de Ica S.R.L., note 30(b) 315 158 85

37,667 60,262 52,270

~~22.~~

~~Administrative expense~~

~~The table below presents the components of this caption:~~

2012 2011 2010
US$(000) US$(000) US$(000)

Personnel expense 40,665 38,466 37,184
Other management expenses 28,796 17,969 8,815
Professional fees 12,307 12,116 6,490
Insurance 2,901 726 856
Board of Directors’ participation 2,522 2,591 2,384
Donations 2,181 1,878 1,691
Rent 2,058 2,653 1,248
Travel and mobility 1,846 731 608
Valuation (reversed) of stock appreciation right 1,720 (5,982 ) 42,425
Supplies 1,669 1,162 665
Communications 989 783 903
Subscription and quote 768 976 848
Maintenance 457 729 534
Canon 377 83 83
Amortization of other assets 39 239 503
Allowance for doubtful accounts - 50 2,000

99,295 75,170 107,237

~~F-83~~

~~Notes to the consolidated financial statements (continued)~~

	2015		2014		2013
	US$(000)		US$(000)		US$(000)

Direct labor		17,278		38,186		42,922
Services provided by third parties		13,665		12,142		16,840
Electricity and water		6,485		5,827		13,801
Consumption of materials and supplies		5,506		5,958		1,678
Transport		3,876		7,209		95
Rentals		2,550		7,312		21,035
Insurances		1,235		1,231		644
Maintenance and repair		639		472		691
Other expenses		1,458		3,150		16,414
Cost of sales of services, without considering depreciation and amortization		52,692		81,487		114,120

23.

Exploration in ~~non-operating areas~~operating units

~~The expenses by exploration area are presented below:~~This caption is made up as follows:

2012 2011 2010
US$(000) US$(000) US$(000)

Projects outside of mining units
Trapiche 16,145 4,731 1,321
San Gregorio 11,292 3,015 2,837
Focus - Chancas 6,381 1,957 104
Consolidado de Hualgayoc 5,704 1,937 2,126
Breapampa 5,571 5,565 1,486
Chiptaj - Chancas 4,360 1,813 784
Colquemayo 3,973 4,042 2,759
San Pedro Sur 2,477 - 1,940
Chacua (San Francisco) 2,209 1,612 105
Mallay 1,959 10,536 9,251
Surichata 1,088 - -
El Faique 916 590 477
Vacas Heladas 453 736 -
La Joya 324 1,577 177
Anamaray 159 99 828
Chaje 24 206 1,042
Terciopelo 23 133 1,230
Pachuca Norte - Mexico - 3,264 203
Other minor projects less than US$500,000 10,524 991 6,018
73,582 42,804 32,688
Projects in mining units
Shila 16,191 - -
Marcapunta 3,119 6,789 3,417
Santa Barbara 2,599 - -

95,491 49,593 36,105

	2015		2014		2013
	US$(000)		US$(000)		US$(000)

Services provided by third parties		73,764		80,281		81,491
Consumption of materials and supplies		10,314		10,087		13,267
Direct labor		2,512		2,756		3,263
Rentals		872		896		1,785
Transport		275		1,201		2,180
Insurance		235		159		228
Other minor expenses		3,548		2,472		(301	)
		91,520		97,852		101,913

24.

Mining royalties

This caption is made up as follows:

	2015		2014		2013
	US$(000)		US$(000)		US$(000)

Sindicato Minero de Orcopampa S.A., Note 29(b)		21,942		21,688		23,843
Royalties paid to the Peruvian State		5,465		6,737		6,057
Others		-		15		502

		27,407		28,440		30,402

F-71

Notes to the consolidated financial statements(continued)

~~24.~~25.

Administrative expenses

This caption is made up as follows:

	2015			2014		2013
	US$(000)			US$(000)		US$(000)

Personnel expenses		39,597			37,983		40,133
Sundry expenses		15,175			27,235		18,574
Professional fees		10,364			13,956		7,109
Insurance		5,105			3,726		5,443
Rentals		4,009			3,217		1,635
Donations		3,336			5,034		2,884
Communications		1,281			1,276		1,618
Board of Directors’ participation		1,055			1,163		1,575
Consumption of materials and supplies		1,032			1,688		1,701
Maintenance and repairs		973			2,720		473
Other mining taxes		824			1,207		1,532
Travel and mobility		787			908		7,890
Subscriptions		540			779		802
Valuation (reversal) of stock appreciation’s rights		(121	)		89		(20,207	)
Amortization of other assets		2,575			121		3,956

		86,532			101,102		75,118

26.

Exploration in non-operating areas

This caption is made up as follows:

	2015		2014		2013
	US$(000)		US$(000)		US$(000)

Services provided by third parties		18,852		34,582		17,801
Personnel expenses		4,713		6,053		6,359
Consumption of materials and supplies		1,436		3,213		2,490
Rentals		376		1,142		707
Maintenance and repairs		87		139		122
Insurance		84		75		60
Transport		20		168		162
Other expenses		5,042		4,635		5,104

		30,610		50,007		32,805

F-72

Notes to the consolidated financial statements(continued)

27.

Finance costs and finance revenues

These captions are made up as follows:

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Finance revenues:
Interests on loans to associates		2,286			2,887			3,322
Interests on tax claims		1,297			-			-
Dividends income		500			2			181
Interests over third parties		492			5,380			2,260
Interest on time deposits		419			139			858
		4,994			8,408			6,621
Unrealized variation of the fair value related to contingent consideration liability, Note 5		6,032			-			-

		11,026			8,408			6,621

Finance costs:
Interest on borrowings		19,182			28,058			12,706
Interest on loans		5,565			729			389
Banking expenses		366			673			355
Tax on financial transaction		312			148			271
Interest on commercial obligations		120			-			-
Variation of fair value of financial assets		-			-			1,565
Other finance costs		41			94			1,680

		25,586			29,702			16,966
Capitalized finance cost of qualify assets		(1,307	)		(20,079	)		(12,706	)

Total finance interest		24,279			9,623			4,260
Accrual of the present value for mine and exploration project closure		3,343			1,695			5,636

Total finance costs		27,622			11,318			9,896

F-73

Notes to the consolidated financial statements(continued)

28.

Deferred income tax

(a)

The ~~Company and its subsidiaries recognize~~Group recognizes the effects of timing differences between the accounting ~~basis~~ and ~~the~~ tax basis. ~~The table below presents the components of this~~This caption ~~according to the items that give rise to them:~~is made up as follows:

	As of January 1, 2011			Credit (debit) to the consolidated Income statement			Credit (debit) to the consolidated changes in shareholders´equity			As of December 31, 2011			Credit (debit) to the consolidated Income statement			Credit (debit) to the consolidated changes in shareholders´ equity			As of December 31, 2012			As of January 1, 2014			Credit (debit) to the Consolidated statement of profit or loss			Credit (debit) to consolidated statements of other comprehensive income			Debit to mining concessions resulting from the merger with Canteras del Hallazgo S.A.C.			As of December 31, 2014			Credit (debit) to the Consolidated statement of profit or loss			Credit (debit) to consolidated statements of other comprehensive income		As of December 31, 2015
	US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)		US$(000)
Deferred asset for income tax included in results
Tax - loss carryforward																							24,275			8,211			-			-			32,486			45,923			-		78,409
Difference in depreciation and amortization rates		19,208			8,831			-			28,039			12,172			-			40,211			57,645			816			-			-			58,461			(6,084	)		-		52,377
Tax – loss carryforward		125,363			(59,053	)		-			66,310			(33,522	)		-			32,788
Effect of translation to U.S. dollars		5,930			3,130			-			9,060			7,746			-			16,806
Provision for closure of mining units, net		13,774			1,132			-			14,906			469			-			15,375			20,084			(288	)		-			-			19,796			12,848			-		32,644
Stock appreciation rights provision		20,862			(7,545	)		-			13,317			(4,864	)		-			8,453
Environmental liability for Mina Santa Barbara		1,494			-			-			1,494			127			-			1,621
Embedded derivative from sale of concentrates		1,327			929			-			2,256			(853	)		-			1,403
Environmental liability for Santa Barbara mine																							1,429			(190	)		-			-			1,239			317			-		1,556
Other minor		7,784			2,053			-			9,837			5,693			-			15,530			20,273			(2,529	)		-			-			17,744			1,954			2,565		22,263
		195,742			(50,523	)		-			145,219			(13,032	)		-			132,187			123,706			6,020			-			-			129,726			54,958			2,565		187,249
Less – Allowance for deferred asset recoverability		(2,622	)		(1,177	)		-			(3,799	)		(1,518	)		-			(5,317	)

Less - Allowance for deferred asset																							(6,404	)		2,167			-			-			(4,237	)		(13,929	)		-		(18,166	)
		193,120			(51,700	)		-			141,420			(14,550	)		-			126,870			117,302			8,187			-			-			125,489			41,029			2,565		169,083

Deferred asset included in retained earnings
Derivative financial instruments		6,957			-			(6,468	)		489			-			(489	)		-			328			2,212			-			-			2,540			(2,311	)		-		229
		200,077			(51,700	)		(6,468	)		141,909			(14,550	)		(489	)		126,870			117,630			10,399			-			-			128,029			38,718			2,565		169,312
Deferred assets for mining royalties and special mining tax included in results
Exploration expenses		-			2,157			-			2,157			1,319			-			3,476			1,957			(1,509	)		-			-			448			(774	)		-		(326	)
Embedded derivatives from sale of concentrate		-			335			-			335			(144	)		-			191
Final price adjustment of open provisional liquidations		-			828			-			828			(804	)		-			24
Other minors																							180			186			-			-			366			(181	)		-		185
		-			3,320			-			3,320			371			-			3,691			2,137			(1,323	)		-			-			814			(955	)		-		(141	)
Total deferred asset		200,077			(48,380	)		(6,468	)		145,229			(14,179	)		(489	)		130,561			119,767			9,076			-			-			128,843			37,763			2,565		169,171

Deferred liability for income tax included in results
Effect of translation into U.S. dollars																							(8,076	)		(23,417	)		-			-			(31,493	)		(42,044	)		-		(73,537	)
Differences in amortization rates for development costs																							(18,504	)		(19,345	)		-			-			(37,849	)		5,545					(32,304	)
Other minors																							(9,277	)		(13,886	)		(1,033	)		(9,235	)		(33,431	)		(1,958	)		807		(34,582	)
																							(35,857	)		(56,648	)		(1,033	)		(9,235	)		(102,773	)		(38,457	)		807		(140,423	)
Deferred liability for mining royalties and special mining tax
Deemed cost of property, plant and equipment																							(203	)		38			-			-			(165	)		153			-		(12	)
Other minors																							(182	)		528			(170	)		-			176			-			-		176
																							(385	)		566			(170	)		-			11			153			-		164
Total deferred liability																							(36,242	)		(56,082	)		(1,203	)		(9,235	)		(102,762	)		(38,304	)		807		(140,259	)

Deferred income tax asset, net																							83,525												26,081								28,912

F-74

Notes to the consolidated financial statements(continued)

As of
January 1,
2011 Credit (debit) to
the consolidated
Income statement Credit (debit) to the
consolidated
changes in
shareholders´equity As of
December 31,
2011 Credit (debit)
to the
consolidated
Income
statement Credit (debit)
to the
consolidated
changes in
shareholders´
equity As of
December 31,
2012
US$(000) US$(000) US$(000) US$(000) US$(000) US$(000) US$(000)
Deferred liability for income tax included in results
Differences in amortization rates for development costs (18,163 ) 3,278 - (14,885 ) 1,792 - (13,093 )
Deemed cost of fixed assets (4,848 ) 1,469 - (3,379 ) 1,094 - (2,285 )
Unrealized loss on financial instruments - (384 ) - (384 ) - 384 -
Other minor (251 ) 6 - (245 ) (1,131 ) - (1,376 )
Embedded derivatives from sale of concentrate (2,765 ) 2,565 - (200 ) 171 - (29 )
(26,027 ) 6,934 - (19,093 ) 1,926 384 (16,783 )
Deferred liability for mining royalties and special mining tax
Deemed cost of fixed assets - (501 ) - (501 ) 217 - (284 )
Adjustment to open provisional liquidations - - - - (151 ) - (151 )
Derivative financial instruments - (54 ) - (54 ) - 54 -
Embedded derivatives from sale of concentrate - (43 ) - (43 ) 43 - -
- (598 ) - (598 ) 109 54 (435 )
Total deferred liability (26,027 ) 6,336 - (19,691 ) 2,035 438 (17,218 )
Deferred asset, net 174,050 125,538 113,343

~~F-86~~

(b)

The deferred tax asset is presented in the consolidated statement of financial position:

	2015			2014
	US$(000)			US$(000)

Deferred income tax asset, net		41,574			47,675
Deferred income tax liability, net		(12,662	)		(21,594	)

		28,912			26,081

(c)

The following is the composition of the provision for income taxes shown in the consolidated statement of income for the years 2015, 2014 and 2013:

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Income tax
Current		(14,225	)		(19,006	)		(57,328	)
Deferred		(541	)		(47,006	)		(29,154	)

		(14,766	)		(66,012	)		(86,482	)

(d)

Below is a reconciliation of tax expense and the accounting profit multiplied by the statutory tax rate for the years 2015, 2014 and 2013:

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Profit (loss) before income tax		(351,256	)		35,486			90,631
Loss before income tax for discontinued operations		(9,523	)		(31,114	)		(83,885	)
Profit (loss) before income tax		(360,779	)		4,372			6,746
Theoretical loss (gain) for income tax		(101,018	)		1,312			2,024
Permanent items and others:
Share in the results of associates		48,545			22,380			34,244
Effect of translation into U.S. dollars		42,044			30,520			22,644
Impairment of deferred tax asset		13,929			-			-
Effect of change in income tax rate net		2,347			327			-
Mining royalties and special mining tax		663			413			(1,650	)
Permanent items		4,450			3,824			18,545

Income tax expense		10,960			58,776			75,807
Mining Royalties and Special Mining Tax		3,806			7,236			10,675

Total income tax		14,766			66,012			86,482

F-75

Notes to the consolidated financial statements(continued)

~~Buenaventura has not recognized deferred income tax liability in relation to the excess of the accounting basis over the tax basis of investments in shares due to the following:~~

-(e)

InRelated to the ~~case of~~investment in associates, the ~~Cerro Verde associate, Buenaventura~~Group has not recognized a deferred income tax asset ~~for~~by US$~~369,206,000~~94,528,000 as of December 31, ~~2012 (deferred asset~~2015 originated by the difference between the financial and taxable basis of ~~US$363,097,000~~these investments (US$47,623,000 as of December 31, 2011), given that Buenaventura’s Management, even though only exercising significant influence over this associate, has the intention and capacity to hold this investment until its copper reserves are depleted; in this sense,2014). Management believes that the timing differences will be reversed ~~by means of dividends to be received~~ in the future ~~that, are not subject to the income tax paid by the Company.~~without taxable effects. There is no legal or contractual obligation that would require the Company’s Management to sell its investment in ~~this associate~~its associates (which event would result in a taxable capital gain based on current tax law).

29.

Commitments and contingencies

Commitments

(a)

Environmental –

The Group’s exploration and exploitation activities are subject to environmental protection standards.

Law No. 28090 regulates the obligations and procedures that must be met by the holders of mining activities for the preparation, filing and implementation of Mine Closure Plans, as well as the establishment of the corresponding environmental guarantees to secure fulfillment of the investments, subject to the principles of protection, preservation and recovery of the environment.

Law No. 28271 regulates environmental liabilities in mining activities. This Law has the objective of ruling the identification of mining activity’s environmental liabilities and financing the remediation of the affected areas. According to this law, environmental liabilities refer to the impact caused to the environment by abandoned or inactive mining operations.

The Group considers that the recorded liability is sufficient to meet the current regulatory environment in Peru.

(b)

Leased concessions -

The Group pays 10% on the valued production of mineral obtained from the concessions leased by Sindicato Minero Orcopampa S.A. This concession is in force until the year 2043. See Note 24.

(c)

Letter of guarantee granted by Buenaventura -

Letter of guarantee - Huanza

On December 2, 2009, Banco de Credito del Perú signed a finance lease contract for US$119 million with Consorcio Energético de Huancavelica S.A., Empresa de Generación Huanza S.A. and Buenaventura. This financing is in favor of Empresa de Generación Huanza S.A., and is guaranteed by Buenaventura. On February 8, 2016, the bank released the guarantee granted by Buenaventura.

F-76

Notes to the consolidated financial statements(continued)

(d)

Operating lease commitments (the Group as a lessee) -

The Group has entered into operating leases on its administrative offices in Lima located in Las Begonias Street N°415, San Isidro, Lima, Peru, with a lease term of 10 years. The Group has the option to lease the assets for two additional terms of 5 years each.

Future minimum rentals payable as of December 31, 2015 and 2014 are the following:

	2015		2014
	US$(000)		US$(000)

Within one year		1,543		1,543
After one year but not more than five years		6,173		6,173
More than five years		4,244		5,787

		11,960		13,503

(e)

Operating lease commitments (the Group as a lessor) -

The Group leases for several of its assets. These leases have purchase options. Below is a table showing future minimum lease payments and the present value of these payments:

	2015					2014
	Minimum payments			Present value of payments		Minimum payments			Present value of payments
	US$(000)			US$(000)		US$(000)			US$(000)

Within a year		47,957			31,956		79,248			64,087
After one year but not more than five years		366,637			321,685		360,132			314,218

Total minimum lease payments		414,594			353,641		439,380			378,305

Less - amounts representing finance charges		(60,953	)		-		(61,075	)		-

Present value of minimum lease payments		353,641			353,641		378,305			378,305

Contingencies

(f)

Legal procedures-

Buenaventura -

Buenaventura is a party in legal procedures that have arisen in the normal course of its activities. Nevertheless, in the opinion of Buenaventura’s Management, none of these procedures, individually or as a whole, could result in material contingencies for the consolidated financial statements.

F-77

Notes to the consolidated financial statements(continued)

The possible contingencies amount to US$2,031,000 and US$1,573,000 as of December 31, 2015 and 2014, respectively.

Yanacocha -

Mercury spill in Choropampa

In June 2000, a carrier hired by Yanacocha spilled approximately 151 kilograms of mercury in the vicinity of the town of Choropampa, Peru, located 85 kilometers (53 miles) southeast of the mine. To date, Yanacocha has held court settlements with people affected by the incident. At December 31, 2015, there are 6 applicants with pending process. Yanacocha cannot reasonably predict the outcome of any of these claims; however, it is estimated that the maximum additional expense related to these demands will be US$1.5 million.

Action for Constitutional Relief against Conga Project Exploitation

On October 19, 2012, Marco Antonio Arana Zegarra ("Marco Arana") initiated an action for constitutional relief against the Mines and Energy Ministry and Yanacocha requesting that the Court orders to cease any threats of violation to life in an adequate and balanced environment; so that Court declare the suspension of the exploitation of the Conga Project and avoid Directorial Resolution No.351-2010-MEM/AM dated on October 27, 2010 that approved the Conga Environmental Impact Assessment.

By Court resolution No.1 dated October 23, 2012, the action was dismissed. On November 5, 2012, resolution No.1 was appealed by plaintiff and the hearing at Superior Court was held on March 4, 2013. The Cajamarca Superior Court confirmed the ruling of the judge that dismissed the claim.

On May 23, 2013, Marco Arana filed for a Constitutional remedy against the Cajamarca Superior Court decision and on June 3, 2013, the Cajamarca Superior Court accepted the Constitutional remedy filed by Marco Arana and the file has been sent to the Constitutional Court. On September 25, 2013, the Constitutional Court heard oral arguments from the parties and we are waiting their decision. To date the case maintains the same status.

(g)Open tax procedures–

Buenaventura -

During 2012 and 2014, the tax authority (SUNAT) reviewed the income tax for 2007 and 2008. As a result, SUNAT do not recognize tax declared deductions by S/1,056,310,000 (equivalent to US$309,493,000) in 2007 and S/1,530,985,000 (equivalent to US$448,575,000) in 2008. The main unrecognized deduction is the payment made for the removal of the price component of its commercial contracts of gold. In the ~~case~~opinion of management and its legal counsel, the ~~Yanacocha associate,~~objections are unfounded so Buenaventura ~~has not recognized~~should get a ~~deferred~~favorable result in the initiated claim process.

During 2015, the tax authorities reviewed the income tax ~~liability~~of 2009 and 2010. As a result, they did not recognize Buenaventura declared tax deductions by S/76,023,000 (equivalent to US$22,275,000). The main unrecognized deductions by Buenaventura are: the non-deductibility of bonuses paid to contractors, a provision of doubtful accounts not accepted as an expense and income unduly deducted. The possible contingencies for the years 2009 and 2010 amount to S/525,921,000 (equivalent to US$~~236,463,000~~154,093,000) as of December 31, 2015. In the opinion of Management and its legal counsel, the Company should get a favorable result in the initiated claim process (by 2009) and will start (by 2010).

F-78

Notes to the consolidated financial statements(continued)

Subsidiaries -

During 2015, the tax authorities reviewed the income tax of the subsidiary Buenaventura Ingenieros S.A (BISA) for the fiscal years 2011 and 2012. The main unrecognized deductions are related to the deduction of bonuses paid to staff as well as the omission of income from transfer of fuel to suppliers, amounting to S/21,034,000 (equivalent to US$6,163,000). In addition, the tax authority requires the payment of the value added tax related to allegedly omitted revenues in the transfer of fuel to suppliers. The possible contingencies for income tax for the years 2011 and 2012 ~~(deferred liability of~~amount to S/9,471,000 (equivalent to US$~~159,320,000~~2,775,000) and for the value added tax amount to S/3,467,000 (US$1,016,000) as of December 31, ~~2011), given that Buenaventura’s~~2015. In the opinion of Management ~~even though only exercising significant influence over~~of this ~~associate, has~~subsidiary and its legal advisors, BISA should get a favorable result in the ~~intention~~initiated claim process (for income tax of 2011 and ~~capacity to hold this investment until its gold~~value added tax for the years 2011 and ~~silver reserves are depleted;~~2012) and in ~~this sense, Management believes that~~ the ~~timing differences will be reversed by means of dividends~~claim to be ~~received in the future that, are not subject to the~~initiated (for income tax paid by the Company. There is no legal or contractual obligation that would require the Company’s Management to sell its investment in this associate (which event would result in a taxable capital gain based on current tax law)of 2012).

~~(b)~~-

~~The table below presents~~During the ~~current~~years 2014 and ~~deferred portions~~2015, the tax authority issued tax assessments for the income tax of the ~~provisions for Income Tax shown in the consolidated income statement~~subsidiary Sociedad Minera El Brocal S.A.A. (El Brocal) for the years ~~2012,~~ 2011 and ~~2010:~~2012. The main objections are related to the deduction of the derivative financial instruments loss and the tax treatment of the mining royalties and amount to S/11,586,000 (equivalent to US$3,395,000). With respect to the objections of 2011, El Brocal decided to pay under protest the income tax assessment by S/8,333,000 (equivalent to US$2,442,000) so it can have access to a discount benefit of the fine and appealed to the Tax Court. In connection with the possible tax debt of 2012 by S/3,576,000 (equivalent to US$1,048,000), El Brocal has appealed to the Tax Court. In the opinion of Management of the subsidiary and its legal advisors, El Brocal should get a favorable result in the initiated claim process.

2012 2011 2010
US$(000) US$(000) US$(000)

Income tax -
Current
Compañía de Minas Buenaventura S.A.A. (37,343 ) (60,091 ) (38,003 )
Minera La Zanja S.A. (30,493 ) (37,180 ) (3,793 )
S.M.R.L. Chaupiloma Dos de Cajamarca (20,560 ) (18,976 ) (16,411 )
Sociedad Minera El Brocal S.A.A. (10,400 ) (35,944 ) (27,765 )
Consorcio Energético de Huancavelica S.A. (3,029 ) (1,404 ) (1,364 )

In addition, the tax authority has issued tax assessments as a result of the audit of other subsidiaries of the Group by S/12,096,000 (equivalent to US$3,544,000). In the opinion of Management and its legal counsel, the assessments are of possible occurrence; however, management of the subsidiaries expects to get a favorable result in the initiated claim process.

Associates -

Cerro Verde –

Mining Royalties

SUNAT, the Peruvian tax authority, has assessed mining royalties on materials processed by Cerro Verde´s concentrator, which commenced operations in late 2006. These assessments cover the period December 2006 to December 2007 and the years 2008 and 2009. In July 2013, the Peruvian Tax Tribunal issued two decisions affirming assessments for the period December 2006 through December 2008. Decisions by the Tax Tribunal ended the administrative stage of the appeal procedures for these assessments.

In September 2013, Cerro Verde filed judiciary appeals related to the assessments because Cerro Verde believes that its 1998 stability agreement exempted all minerals extracted from its mining concessions from royalties, irrespective of the method used for processing those minerals. With respect to the judiciary appeal related to the assessment for the year 2008, on December 17, 2014, the Eighteenth Contentious Administrative Court rendered its decision upholding Cerro Verde’s position and nullifying SUNAT’s assessment and the Tax Tribunal´s resolution (S/.106.4 million). In December 2014, SUNAT and the Tax Court appealed this decision. The court’s position also invalidates all penalties and interest assessed by SUNAT for that period (S/.139.7 million). On January 29, 2016, the 6th Superior Justice Court nullified the decision of the Eighteenth Contentious Administrative Court. Cerro Verde will appeal the decision to the Supreme Court.

F-79

Notes to the consolidated financial statements(continued)

On October 1, 2013, SUNAT served Cerro Verde a demand for payment totaling S/.492 million (approximately US$144 million based on December 31, 2015 exchange rates, including interest and penalties of US$85 million) based on the Tax Tribunal’s decisions for the period December 2006 to December 2008. As permitted by law, Cerro Verde requested, and was granted, an installment payment program that deferred payment for six months and thereafter satisfies the amount via 66 equal monthly payments. As of December 31, 2015, Cerro Verde has made payments totaling S/219 million (equivalent to US$64 million) under the installment program. Based on the results rendered by the Eighteenth Contentious Administrative Court as is described in the previous paragraph, Cerro Verde requested an injunction that was accepted by the Judiciary and implied a modification of the installment program excluding the 2008 portion through SUNAT’s resolution notified to Cerro Verde on October 29, 2015.

In July 2013, a hearing on SUNAT's assessment for 2009 was held, but no decision has been issued by the Tax Tribunal for that year. As of December 31, 2015, the amount of the assessment, including interest and penalties, for the year 2009 was S/247 million (approximately US$72 million based on December 31, 2015, exchange rates). As of December 31, 2015, Cerro Verde estimates that the total exposure associated with mining royalties for the period from December 2006 to December 2013, including accumulated interest and penalties, amounted to approximately US$500 million at December 31, 2015 exchange rates.

As of December 31, 2015, no amounts were accrued for these assessments or for the amounts paid under the installment payment program because management and its external legal advisors believe Cerro Verde’s 1998 stability agreement exempted it from these royalties and believes that the resolution will be favorable to Cerro Verde and any payments should be recoverable.

Other taxes

Cerro Verde has also received assessments from SUNAT for additional taxes (other than the mining royalty explained above), including penalties and interest. Cerro Verde has filed or will file objections to the assessments because it believes it has properly determined and paid its taxes. A summary of these assessments follows:

Fiscal Year	Taxes		Interest and fines		Total
	US$(000)		US$(000)		US$(000)

2002 – 2005		16,037		52,800		68,837
2006		6,545		47,662		54,207
2007		12,376		17,809		30,185
2008		20,797		12,968		33,765
2009		56,198		47,719		103,917
2010		65,997		89,404		155,401
2014		5,512		-		5,512
2015		3,753		-		3,753

		187,215		268,362		455,577

As of December 31, 2015, Cerro Verde has paid US$180,741,000 on these disputed tax assessments, which it believes is collectible.

Yanacocha -

SUNAT challenged the withholding tax rate applied on the technical assistance services provided by non-resident supplier. The services were executed in Peru and also abroad; however, Yanacocha was not able to prove it during the tax audit. Based on that, SUNAT considers that the services were wholly executed in Peru; hence, the withholding tax rate must be 30% instead of 12%. The amount of the contingency involved is S/ 12.4 million (US$ 3.6 million). In Management's and its legal counsel’s opinion, that interpretation has no support so Yanacocha should get a favorable outcome in the appeal initiated.

F-80

Notes to the consolidated financial statements(continued)

SUNAT considers that the bonus for closing the collective agreement and the collateral benefits granted to the unionized and non-unionized employees qualify as remunerative concepts; hence, taxed with the contribution to ESSALUD. The contingency amounts to S/ 6.5 million (US$ 2 million).

In Management's and its legal counsel’s opinion, that interpretation has no support so Yanacocha should get a favorable outcome in the appeal initiated against the tax authorities.

30. Transactions with associates companies

(a)

The Group has carried out the following transactions with its associates in the years 2015, 2014 and 2013:

	2015		2014		2013
	US$(000)		US$(000)		US$(000)

Royalties collected to Minera Yanacocha S.R.L.:
S.M.R.L. Chaupiloma Dos de Cajamarca (c)		32,414		36,867		44,185

Services provided to Minera Yanacocha S.R.L. by:
Consorcio Energético de Huancavelica S.A. (electric power transmission)		1,694		915		915
Buenaventura Ingenieros S.A (execution of specific work orders)		845		699		699

Dividends received by:
Compañía Minera Coimolache S.A.		6,691		12,938		9,803

Loans granted to:
Sociedad Minera Cerro Verde S.A.A.		124,800		-		-

Sales of supplies to Compañía Minera Coimolache S.A. by:
Minera La Zanja S.R.L.		74		10		-
Compañía de Minas Buenaventura S.A.A.		56		913		32

F-81

Notes to the consolidated financial statements(continued)

	2015		2014		2013
	US$(000)		US$(000)		US$(000)

Sales of mineral to Minera Yanacocha S.R.L. by:
Compañía de Minas Buenaventura S.A.A.		2,114		3,258		7,146

Energy sales to Compañía Minera Coimolache S.A. by:
Empresa de Generación Huanza S.A.		1,676		233		-

Interest income over loans granted by Compañía Minera Coimolache S.A. to:
Consorcio Energético de Huancavelica S.A.A.		19		35		51

Supplies purchase to Compañía Minera Coimolache S.A. by:
Compañía de Minas Buenaventura S.A.A.		29		6		59
Minera La Zanja S.R.L.		6		24		12

Contributions and investments made to:
Canteras del Hallazgo S.A.C.		-		2,012		6,988

(b)

As a result of the transactions indicated in the paragraph (a), the Group had the following accounts receivable and payable from/to associates:

	2015		2014
	US$(000)		US$(000)

Trade receivables -
Minera Yanacocha S.R.L. (c)		8,760		14,566
Compañía Minera Coimolache S.A.		666		515
		9,426		15,081
Other receivables
Sociedad Minera Cerro Verde S.A.A. (d)		124,988		-
Compañía Minera Coimolache S.A.		499		334
		125,487		334

Total trade and other receivables		134,913		15,415

Classification by maturity:
Current portion		9,925		15,415
Non-current portion		124,988		-

Total trade and other receivables		134,913		15,415

F-82

Notes to the consolidated financial statements(continued)

	2015		2014
	US$(000)		US$(000)

Trade payables -
Compañía Minera Coimolache S.A.		892		1,384
Minera Yanacocha S.R.L.		283		410

Total trade and other payables		1,175		1,794

Classification by maturity:
Current portion		1,175		1,611
Non-current portion		-		183

Total trade and other payables		1,175		1,794

(c)

S.M.R.L. Chaupiloma Dos de Cajamarca -

In accordance with mining lease, amended and effective on January 1, 1994, Minera Yanacocha S.R.L. pays the Group a 3% royalty based on quarterly production sold at current market prices, after deducting refinery and transportation costs. The royalty agreement expires in 2032.

(d)

Sociedad Minera Cerro Verde S.A. -

In December 2014, Cerro Verde entered into shareholder loan agreements with, or affiliates of, Freeport Minerals Corporation, Compañía de Minas Buenaventura S.A.A. and SMM Cerro Verde Netherlands B.V., for up to US$800 million. As of December 31, 2015, Cerro Verde had borrowed US$600.9 million under these loan agreements (US$125 million with Buenaventura as of December 31, 2015). The loans mature on December 22, 2019, unless at that time there is senior financing associated with the expansion project that is senior to the loans, in which case the loans mature two years following the maturity of the senior financing.

(e)

Key officers -

As of December 31, 2015 and 2014, directors, officers and employees of the Group have been involved, directly and indirectly, in financial transactions with certain subsidiaries. As of December 31, 2015 and 2014, loans to employees, directors and key personnel amounts to US$61,000 and US$27,000, respectively, are paid monthly and earn interest at market rates.

There are no loans to the Group’s directors and key personnel guaranteed with Buenaventura or any of its Subsidiaries’ shares.

The Group’s key executives’ compensation (including the related income taxes assumed by the Group) as of December 31, 2015 and 2014 are presented below:

	2015		2014
	US$(000)		US$(000)
Accounts payable:
Salaries		3,381		1,225
Directors’ compensations		1,047		1,090
Share-based compensation plans		330		461

Total		4,758		2,776
Disbursements:
Salaries		7,864		8,423
Share-based compensation plans		-		1,599

Total		7,864		10,022

F-83

Notes to the consolidated financial statements(continued)

31.

Disclosure of information on segments

Management has determined its operating segments based on reports that the Group’s Chief Operating Decision Maker (CODM) uses for making decisions. The Group is organized into business units based on its products and services, activities and geographic locations. The broad categories of the Group’s business units are:

Production and sale of minerals;

Exploration and development activities;

Construction and engineering services;

Energy generation and transmission services;

Insurance brokerage;

Rental of mining concessions;

Holding of investment in shares (mainly in the associate company Minera Yanacocha S.R.L. and the Group’s subsidiary; S.M.R.L. Chaupiloma Dos de Cajamarca);

Industrial activities.

The CODM monitors the operating results of the business units separately for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on operating profit or loss and is measured consistently with operating profit or loss in the Group’s consolidated financial statements. Also, the Group’s financing and income taxes are managed at the corporate level and are not allocated to the operating segments, except for those entities which are managed independently.

Corporate information mainly includes the following:

In segment information of profit and loss –

Sales to third parties of gold purchased by the Parent company from La Zanja mining unit and the corresponding cost of sale as well as other intercompany sales;

Administrative expenses, other income (expenses), exchange gain (loss), finance costs and income and income tax that cannot be directly allocated to the operational mining units owned by the Parent company (Uchucchacua, Orcopampa, Julcani, Mallay and Breapampa);

Exploration activities in non-operating areas, carried out directly by the Parent company and not by the consolidated separate legal entities;

Participation in subsidiaries and associate companies of the Parent company, which are accounted for using the equity method;

Gain on business combination occurred in 2014, see Note 5 to the consolidated financial statements.

In the segment information of assets and liabilities –

Investments in Sociedad Minera Cerro Verde S.A.A. and Compañía Minera Coimolache S.A., associate companies which are directly owned by the Parent company and are accounted for using the equity method; see Note 11 to the consolidated financial statements;

F-84

Notes to the consolidated financial statements(continued)

Assets and liabilities of the operational mining units owned directly by the Parent company since this is the way the CODM analyzes the business. Assets and liabilities of other operating segments are allocated based on the assets and liabilities of the legal entities included in those segments.

Adjustments and eliminations mainly include the following:

In segment information of consolidated statements of profit and loss –

The elimination of any profit or loss of investments accounted for under the equity method and not consolidated by the Group corresponding to the associate companies: Minera Yanacocha S.R.L., Sociedad Minera Cerro Verde S.A.A. and Compañía Minera Coimolache S.A.;

The elimination of intercompany sales and cost of sales;

The elimination of any equity pickup profit or loss of the subsidiaries of the Parent company.

F-85

Notes to the consolidated financial statements(continued)

In the segment information of assets and liabilities –

The elimination of the assets and liabilities of the investments accounted for under the equity method and not consolidated, corresponding to the associate companies: Minera Yanacocha S.R.L., Sociedad Minera Cerro Verde S.A.A. and Compañía Minera Coimolache S.A.;

The elimination of any equity pickup investments of the subsidiaries of the Parent company;

The elimination of intercompany receivables and payables.

Refer to Note 21 (a) to the consolidated financial statements where the Group reports revenues from external customers for each product and service, and revenues from external customers attributed to Peru and foreign countries. The revenue information is based on the locations of customers.

Refer to Note 21 (b) to the consolidated financial statements for information about major customers (clients representing more than 10% of the Group’s revenues).

All non-current assets are located in Peru.

F-86

Notes to the consolidated financial statements(continued)

																																														Equity accounted investees
	Ucchuchacua (Operation)			Orcopampa (Operation)			Julcani (Operation)			Mallay (Operation)			Breapampa (Operation)			Colquijirca (Operation)			La Zanja (Operation)			Exploration and development mining projects			Construction and engineering			Energy generation and transmission			Insurance brokerage			Rental of mining concessions			Holding of investment in shares			Industrial activities			Corporate			Minera Yanacocha S.R.L.			Sociedad Minera Cerro Verde S.A.A			Compañía Minera Coimolache S.A.			Total operating segments			Adjustments and eliminations			Total
	US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)
Year 2015
Results:
Continuing operations
Operating income
Net sale of goods		166,055			254,118			50,254			32,018			22,343			171,294			161,007			-			-			-			-			-			-			-			168,667			1,031,174			1,115,617			177,347			3,349,894			(2,484,932	)		864,962
Net sale of services		-			-			-			-			-			-			-			-			48,758			48,339			11,929			-			-			17,048			-			10,625			-			-			136,699			(82,211	)		54,488
Royalty income		-			-			-			-			-			-			-			-			-			-			-			32,414			-			-			-			-			-			-			32,414			-			32,414
Total operating income		166,055			254,118			50,254			32,018			22,343			171,294			161,007			-			48,758			48,339			11,929			32,414			-			17,048			168,667			1,041,799			1,115,617			177,347			3,519,007			(2,567,143	)		951,864
Operating costs
Cost of sales		(126,728	)		(112,707	)		(26,725	)		(20,709	)		(11,529	)		(158,804	)		(106,750	)		-			-			-			-			-			-			-			(169,236	)		(751,736	)		(862,004	)		(104,549	)		(2,451,477	)		1,913,764			(537,713	)
Cost of services		-			-			-			-			-			-			-			-			(48,544	)		(20,767	)		-			-			-			(16,820	)		-			(2,524	)		-			-			(88,655	)		35,963			(52,692	)
Exploration in operating units		(27,784	)		(41,705	)		(12,699	)		(7,539	)		(1,821	)		-			(41	)		-			-			-			-			-			-			-			-			-			-			-			(91,589	)		69			(91,520	)
Depreciation and amortization		(15,767	)		(17,313	)		(11,349	)		(15,439	)		(9,882	)		(45,752	)		(104,984	)		(17	)		(850	)		(10,260	)		-			(54	)		(226	)		(9,545	)		(1,027	)		-			-			-			(242,465	)		-			(242,465	)
Mining royalties		(1,142	)		(23,877	)		(337	)		(234	)		(219	)		-			(1,597	)		-			-			-			-			-			-			-			(1	)		-			-			-			(27,407	)		-			(27,407	)
Total operating costs		(171,421	)		(195,602	)		(51,110	)		(43,921	)		(23,451	)		(204,556	)		(213,372	)		(17	)		(49,394	)		(31,027	)		-			(54	)		(226	)		(26,365	)		(170,264	)		(754,260	)		(862,004	)		(104,549	)		(2,901,593	)		1,949,796			(951,797	)
Gross profit (loss)		(5,366	)		58,516			(856	)		(11,903	)		(1,108	)		(33,262	)		(52,365	)		(17	)		(636	)		17,312			11,929			32,360			(226	)		(9,317	)		(1,597	)		287,539			253,613			72,798			617,414			(617,347	)		67
Operating expenses
Administrative expenses		(10,739	)		(16,698	)		(3,623	)		(2,080	)		(2,160	)		(19,181	)		(2,251	)		(1,444	)		(7,859	)		(3,422	)		(11,296	)		(106	)		(209	)		(654	)		(11,370	)		(26,325	)		-			(2,185	)		(121,602	)		35,070			(86,532	)
Exploration in non-operating areas		-			-			-			-			-			(2,366	)		(8,954	)		(15,892	)		-			-			-			-			-			-			(5,685	)		-			-			-			(32,897	)		2,287			(30,610	)
Selling expenses		(3,552	)		(851	)		(1,055	)		(1,424	)		(116	)		(9,056	)		(1,207	)		-			-			(806	)		-			-			-			(1,411	)		(3	)		(3,534	)		(56,215	)		(1,111	)		(80,341	)		60,860			(19,481	)
Other, net		1,836			(1,182	)		(125	)		(67	)		172			(2,657	)		(687	)		(1,095	)		7,417			(305	)		(4	)		-			793			98			6,329			(82,846	)		(26,600	)		765			(98,158	)		98,367			209
Impairment loss of long-lived assets														(7,452	)		-			(3,803	)		-			-			-			-			-			-			-			-			-			-			(672	)		(11,927	)		672			(11,255	)
Total operating expenses, net		(12,455	)		(18,731	)		(4,803	)		(3,571	)		(9,556	)		(33,260	)		(16,902	)		(18,431	)		(442	)		(4,533	)		(11,300	)		(106	)		584			(1,967	)		(10,729	)		(112,705	)		(82,815	)		(3,203	)		(344,925	)		197,256			(147,669	)
Operating profit (loss)		(17,821	)		39,785			(5,659	)		(15,474	)		(10,664	)		(66,522	)		(69,267	)		(18,448	)		(1,078	)		12,779			629			32,254			358			(11,284	)		(12,326	)		174,834			170,798			69,595			272,489			(420,091	)		(147,602	)
Other income (expense),net
Share in the results of associates under equity method		-			-			-			-			-			-			-			-			6,561			478			2			-			(187,269	)		-			(268,463	)		-			-			-			(448,691	)		275,316			(173,375	)
Finance costs		(195	)		(235	)		(152	)		(108	)		(50	)		(10,096	)		(3,684	)		(215	)		(1,413	)		(8,817	)		(21	)		(4	)		(1	)		(842	)		(4,043	)		-22,734			(16,010	)		(51	)		(68,671	)		41,049			(27,622	)
Net gain (loss) from currency exchange difference		539			461			378			75			10			(3,832	)		(1,973	)		(1,797	)		(1,393	)		(1,586	)		(165	)		45			4			(2,162	)		(2,287	)		(251	)		(75,770	)		(1,300	)		(91,004	)		77,321			(13,683	)
Finance income		5			5			2			-			-			154			16			-			182			23			13			-			-			-			10,785			673			512			23			12,393			(1,367	)		11,026
Total other income (expense), net		349			231			228			(33	)		(40	)		(13,774	)		(5,641	)		(2,012	)		3,937			(9,902	)		(171	)		41			(187,266	)		(3,004	)		(264,008	)		(22,312	)		(91,268	)		(1,328	)		(595,973	)		392,319			(203,654	)
Profit (loss) before income tax		(17,472	)		40,016			(5,431	)		(15,507	)		(10,704	)		(80,296	)		(74,908	)		(20,460	)		2,859			2,877			458			32,295			(186,908	)		(14,288	)		(276,334	)		152,522			79,530			68,267			(323,484	)		(27,772	)		(351,256	)
Income tax		(518	)		(602	)		(140	)		(78	)		(3	)		4,109			5,702			-			(4,386	)		(3,887	)		(299	)		(9,186	)		(87	)		584			(5,975	)		(602,717	)		(46,246	)		(29,861	)		(693,590	)		678,824			(14,766	)
Profit (loss) from continued operations		(17,990	)		39,414			(5,571	)		(15,585	)		(10,707	)		(76,187	)		(69,206	)		(20,460	)		(1,527	)		(1,010	)		159			23,109			(186,995	)		(13,704	)		(282,309	)		(450,195	)		33,284			38,406			(1,017,074	)		651,052			(366,022	)
Loss from discontinued operations, see Note 1(e)																																																														(9,523	)
Net loss																																																														(375,545	)

Total assets		-			-			-			-			-			739,941			220,331			53,214			31,463			393,318			5,979			9,397			997,835			118,012			3,677,307			2,965,430			7,852,692			238,175			17,303,094			(12,755,913	)		4,547,181
Total liability		-			-			-			-			-			364,455			106,846			3,514			29,599			235,695			3,457			3,508			2,831			31,479			516,241			736,605			3,354,318			63,119			5,451,667			(4,293,722	)		1,157,945

Other segment information
Investment in associates		-			-			-			-			-			-			-			-			-			-			-			-			-			-			3,519			989,130			988,725			62,609			2,043,983			-			2,043,983
Additions to mining concessions, development costs, property, plant and equipment		22,669			3,151			4,795			3,234			1,988			55,073			62,968			57,173			527			6,159			85			-			1,205			2,140			66,918			-			-			-			288,085			-			288,085

F-87

Notes to the consolidated financial statements (continued)

2012 2011 2010
US$(000) US$(000) US$(000)
Other (4,984 ) (4,867 ) (1,246 )
(106,809 ) (158,462 ) (88,582 )
Deferred
Compañía de Minas Buenaventura S.A.A. (27,890 ) (51,544 ) (29,519 )
Minera La Zanja S.A. 7,463 31 (5,134 )
Sociedad Minera El Brocal S.A.A. 2,457 6,335 (55 )
Other 6,723 54 (36 )
(11,247 ) (45,124 ) (34,744 )
(118,056 ) (203,586 ) (123,326 )
Mining royalties and Special Mining Tax -
Current
Compañía de Minas Buenaventura S.A.A. (16,041 ) (7,371 ) -
Minera La Zanja S.A. (5,170 ) (2,176 ) -
Sociedad Minera El Brocal S.A.A. (3,765 ) (1,211 ) -
(24,976 ) (10,758 ) -

Deferred
Compañía de Minas Buenaventura S.A.A. 1,093 1,140 -
Minera La Zanja S.A. (330 ) 1,634 -
Sociedad Minera El Brocal S.A.A. (282 ) 3 -
Compañía de Exploraciones, Desarrollo e Inversiones Mineras S.A.C. - CEDIMIN (43 ) (22 ) -
438 2,755 -
(24,538 ) (8,003 ) -

Total income tax (142,594 ) (211,589 ) (123,326 )

																																														Equity accounted investees
	Ucchuchacua (Operation)			Orcopampa (Operation)			Julcani (Operation)			Mallay (Operation)			Breapampa (Operation)			Colquijirca (Operation)			La Zanja (Operation)			Exploration and development mining projects			Construction and engineering			Energy generation and transmission			Insurance brokerage			Rental of mining concessions			Holding of investment in shares			Industrial activities			Corporate			Minera Yanacocha S.R.L.			Sociedad Minera Cerro Verde S.A.A			Compañía Minera Coimolache S.A.			Total operating segments			Adjustments and eliminations			Total
	US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)

Year 2014
Results:																								��
Continuing operations
Operating income
Net sale of goods		202,543			264,049			49,767			42,974			108,468			210,002			185,286			-			-			-			-			-			-			-			187,503			1,165,299			1,467,097			192,369			4,075,357			(3,008,086	)		1,067,271
Net sale of services		-			-			-			-			-			-			-			-			66,853			38,906			10,608			-			-			13,976			-			20,705			-			-			151,048			(79,406	)		71,642
Royalty income		-			-			-			-			-			-			-			-			-			-			-			36,867			-			-			-			-			-			-			36,867			-			36,867
Total operating income		202,543			264,049			49,767			42,974			108,468			210,002			185,286			-			66,853			38,906			10,608			36,867			-			13,976			187,503			1,186,004			1,467,097			192,369			4,263,272			(3,087,492	)		1,175,780
Operating costs
Cost of sales		(149,251	)		(113,467	)		(26,364	)		(22,583	)		(37,897	)		(122,995	)		(84,381	)		-			-			-			-			-			-			-			(186,650	)		(910,705	)		(797,481	)		(100,649	)		(2,552,423	)		2,019,371			(533,052	)
Cost of services		-			-			-			-			-			-			-			-			(68,964	)		(19,252	)		-			-			-			(12,703	)		-			(22,422	)		-			-			(123,341	)		41,854			(81,487	)
Exploration in operating units		(26,633	)		(51,814	)		(10,981	)		(7,807	)		(495	)		-			(120	)		-			-			-			-			-			-			-			(2	)		-			-			-			(97,852	)		-			(97,852	)
Depreciation and amortization		(15,293	)		-23,266			(11,769	)		(24,742	)		(35,699	)		(26,974	)		(53,158	)		-			(717	)		(8,683	)		-			(74	)		(231	)		(7,224	)		(868	)		-			-			-			(208,698	)		-			(208,698	)
Mining royalties		(1,893	)		(24,113	)		(466	)		(401	)		(1,012	)		-			(555	)		-			-			-			-			-			-			-			-			-			-			-			(28,440	)		-			(28,440	)
Total operating costs		(193,070	)		(212,660	)		(49,580	)		(55,533	)		(75,103	)		(149,969	)		(138,214	)		-			(69,681	)		(27,935	)		-			(74	)		(231	)		(19,927	)		(187,520	)		(933,127	)		(797,481	)		(100,649	)		(3,010,754	)		2,061,225			(949,529	)
Gross profit (loss)		9,473			51,389			187			(12,559	)		33,365			60,033			47,072			-			(2,828	)		10,971			10,608			36,793			(231	)		(5,951	)		(17	)		252,877			669,616			91,720			1,252,518			(1,026,267	)		226,251
Operating expenses
Administrative expenses		(12,351	)		(16,077	)		(3,289	)		(2,719	)		(7,349	)		(17,634	)		(5,920	)		(3,184	)		(16,135	)		(4,354	)		(8,901	)		(113	)		(208	)		(376	)		(7,828	)		(38,262	)		-			(2,073	)		(146,773	)		45,671			(101,102	)
Exploration in non-operating areas		-			(7,294	)		-			-			-			(5,085	)		(19,689	)		(14,399	)		-			-			-			-			-			-			(3,540	)		-			-			-			(50,007	)		-			(50,007	)
Selling expenses		(3,416	)		(955	)		(1,067	)		(1,755	)		(393	)		(7,103	)		(1,441	)		-			-			(323	)		-			-			-			(147	)		(5	)		(4,458	)		(54,210	)		(1,078	)		(76,351	)		59,746			(16,605	)
Other, net		1,338			657			(4,661	)		921			(110	)		226			(2,833	)		569			8,070			7,718			109			(1	)		651			(77	)		3,930			(77,781	)		(3,629	)		929			(63,974	)		67,033			3,059
Impairment loss of long-lived assets		-			-			-			-			-			-			-			-			-			-			-			-			-			-			-			(541,141	)		-			-			(541,141	)		541,141			-

Total operating expenses, net		(14,429	)		(23,669	)		(9,017	)		(3,553	)		(7,852	)		(29,596	)		(29,883	)		(17,014	)		(8,065	)		3,041			(8,792	)		(114	)		443			(600	)		(7,443	)		(661,642	)		(57,839	)		(2,222	)		(878,246	)		713,591			(164,655	)
Operating profit (loss)		(4,956	)		27,720			(8,830	)		(16,112	)		25,513			30,437			17,189			(17,014	)		(10,893	)		14,012			1,816			36,679			212			(6,551	)		(7,460	)		(408,765	)		611,777			89,498			374,272			(312,676	)		61,596
Other income (expense),net
Share in the results of associates under equity method		-			-			-			-			-			-			-			-			(6,987	)		(2,186	)		-			-			(160,379	)		-			(91,962	)		-			-			-			(261,514	)		186,914			(74,600	)
Finance costs		(294	)		(170	)		(153	)		(67	)		(43	)		(4	)		(1,728	)		(140	)		(1,223	)		(8,838	)		(15	)		(3	)		(2	)		(722	)		(760	)		(23,504	)		(369	)		(583	)		(38,618	)		27,300			(11,318	)
Net gain (loss) from currency exchange difference		354			332			124			66			5			(1,031	)		(1,525	)		(446	)		(757	)		(1,021	)		8			(50	)		(4	)		(1,107	)		(3,400	)		1,142			2,284			(1,465	)		(6,491	)		(1,961	)		(8,452	)
Gain on business combination		-			-			-			-			-			-			-			-			-			-			-			-			-			-			59,852			-			-			-			59,852			-			59,852
Finance income		10			13			4			-			-			(278	)		-			-			-			-			8			-			-			-			3,951			298			2,443			47			6,496			1,912			8,408

Total other income (expense), net		70			175			(25	)		(1	)		(38	)		(1,313	)		(3,253	)		(586	)		(8,967	)		(12,045	)		1			(53	)		(160,385	)		(1,829	)		(32,319	)		(22,064	)		4,358			(2,001	)		(240,275	)		214,165			(26,110	)

Profit (loss) before income tax		(4,886	)		27,895			(8,855	)		(16,113	)		25,475			29,124			13,936			(17,600	)		(19,860	)		1,967			1,817			36,626			(160,173	)		(8,380	)		(39,779	)		(430,829	)		616,135			87,497			133,997			(98,511	)		35,486
Income tax		-			-			-			-			-			(21,621	)		(12,388	)		-			567			(4,835	)		(368	)		(10,996	)		(48	)		978			(17,301	)		30,491			(238,529	)		(36,089	)		(310,139	)		244,127			(66,012	)
Profit (loss) from continued operations		(4,886	)		27,895			(8,855	)		(16,113	)		25,475			7,503			1,548			(17,600	)		(19,293	)		(2,868	)		1,449			25,630			(160,221	)		(7,402	)		(57,080	)		(400,338	)		377,606			51,408			(176,142	)		145,616			(30,526	)

Loss from discontinued operations, see Note 1(e)																																																														(31,114	)
Net loss																																																														(61,640	)

Total assets		-			-			-			-			-			765,143			278,836			50,370			87,546			403,660			6,265			14,727			1,208,772			130,803			3,778,132			3,483,169			5,771,984			205,059			16,184,466			(11,512,192	)		4,672,274
Total liability		-			-			-			-			-			311,001			96,147			5,726			95,466			225,409			3,109			5,727			166			29,472			294,027			803,392			1,306,894			51,720			3,228,256			(2,318,107	)		910,149

Other segment information
Investment in associates		-			-			-			-			-			-			-			-			-			-			-			-			-			-			3,519			1,185,971			982,206			52,685			2,224,381			-			2,224,381
Additions to mining concessions, development costs, property, plant and equipment		12,668			8,963			699			963			3,544			105,477			29,113			83,723			7,516			17,948			227			-			-			-			15,081			-			-			-			285,922			-			285,922

F-88

Notes to the consolidated financial statements (continued)

~~(c)~~

~~During the years 2012, 2011 and 2010 the provisions posted for income tax in the income statement were determined as follows:~~

2012 % 2011 % 2010 %
US$(000) US$(000) US$(000)

Income before income tax 885,384 1,172,067 848,215
Share in the results of associates (464,239 ) (468,363 ) (428,885 )
421,145 100.0 703,704 100.0 419,330 100.0

Theoretical income tax 126,344 30.0 211,112 30.0 125,799 30.0
Expenses not deductible for tax purposes 4,578 1.1 4,856 0.7 1,963 0.5
Effect of translation to U.S. dollars (11,716 ) (2.8 ) (3,130 ) (0.4 ) (941 ) (0.2 )
Mining royalties and special mining tax (5,876 ) (1.4 ) (3,227 ) (0.5 ) - -
Effect from currency exchange difference (3,794 ) (0.9 ) (5,027 ) (0.7 ) - -
Recovery of exploration expenses in Tantahuatay project - - - - (4,504 ) (1.1 )
Reversal of the provision for impairment of long-lived assets - - - - (4,867 ) (1.2 )
Other permanent items 8,520 2.0 (998 ) (0.1 ) 5,876 1.4
Expense for income tax purposes 118,056 28.0 203,586 28.9 123,326 29.4
Mining royalties and Special Mining Tax 24,538 5.8 8,003 1.1 - -

Total 142,594 33.9 211,589 30.1 123,326 29.4

	Ucchuchacua (Operation)			Orcopampa (Operation)			Julcani (Operation)			Mallay (Operation)			Breapampa (Operation)			Colquijirca (Operation)			La Zanja (Operation)			Exploration and development mining projects			Construction and engineering			Energy generation and transmission			Insurance brokerage			Rental of mining concessions			Holding of investment in shares			Corporate			Minera Yanacocha S.R.L.			Sociedad Minera Cerro Verde S.A.A			Compañía Minera Coimolache S.A.			Total operating segments			Adjustments and eliminations			Total
	US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)			US$(000)
Year 2013
Results:
Continuing operations
Operating income
Net sale of goods		205,218			324,343			45,995			44,896			119,871			187,769			193,298			1,504			-			-			-			-			-			206,240			1,406,825			1,811,488			209,636			4,757,083			(3,621,247	)		1,135,836
Net sale of services		-			-			-			-			-			-			-			-			96,523			33,809			8,455			-			-			-			29,181			-			-			167,968			(88,383	)		79,585
Royalty income		-			-			-			-			-			-			-			-			-			-			-			44,185			-			-			-			-			-			44,185			-			44,185
Total operating income		205,218			324,343			45,995			44,896			119,871			187,769			193,298			1,504			96,523			33,809			8,455			44,185			-			206,240			1,436,006			1,811,488			209,636			4,969,236			(3,709,630	)		1,259,606
Operating costs
Cost of sales		(113,631	)		(128,184	)		(17,585	)		(24,282	)		(49,535	)		(119,969	)		(85,980	)		(555	)		-			-			-			-			-			(208,968	)		(983,238	)		(795,064	)		(124,325	)		(2,651,316	)		2,138,151			(513,165	)
Cost of services		-			-			-			-			-			-			-			-			(91,804	)		(25,412	)		-			-			-			-			(28,672	)		-			-			(145,888	)		31,768			(114,120	)
Exploration in operating units		(25,311	)		(57,871	)		(7,054	)		(9,342	)		(2,974	)		-			(1,236	)		(2,441	)		-			-			-			-			-			-			-			-			-			(106,229	)		4,316			(101,913	)
Depreciation and amortization		(10,844	)		(28,964	)		(4,586	)		(20,348	)		(25,501	)		(35,644	)		(27,930	)		(9	)		(264	)		(1,751	)		-			(112	)		(1,434	)		(524	)		-			-			-			(157,911	)		(1,229	)		(159,140	)
Mining royalties		(1,675	)		(26,448	)		(405	)		(365	)		(968	)		-			(431	)		(110	)		-			-			-			-			-			-			-			-			-			(30,402	)		-			(30,402	)
Total operating costs		(151,461	)		(241,467	)		(29,630	)		(54,337	)		(78,978	)		(155,613	)		(115,577	)		(3,115	)		(92,068	)		(27,163	)		-			(112	)		(1,434	)		(209,492	)		(1,011,910	)		(795,064	)		(124,325	)		(3,091,746	)		2,173,006			(918,740	)
Gross profit (loss)		53,757			82,876			16,365			(9,441	)		40,893			32,156			77,721			(1,611	)		4,455			6,646			8,455			44,073			(1,434	)		(3,252	)		424,096			1,016,424			85,311			1,877,490			(1,536,624	)		340,866
Operating expenses
Administrative expenses		(11,818	)		(20,381	)		(1,949	)		(2,607	)		(7,128	)		(15,637	)		(2,475	)		(2,330	)		(8,282	)		(2,571	)		(7,801	)		(96	)		(5,916	)		13,342			(67,064	)		-			(1,843	)		(144,556	)		69,438			(75,118	)
Exploration in non-operating areas		-			-			-			-			-			(5,220	)		(6,563	)		(2,444	)		-			-			-			-			-			(21,928	)		-			-			-			(36,155	)		3,350			(32,805	)
Selling expenses		(3,346	)		(3	)		(755	)		(1,423	)		-			(8,763	)		(528	)		(10	)		-			-			-			-			-			(13	)		(3,740	)		(68,448	)		(522	)		(87,551	)		72,709			(14,842	)
Other, net		2,592			1,822			209			108			(158	)		(656	)		(18	)		1,910			422			50			94			(3	)		657			(9,674	)		(77,534	)		147			779			(79,253	)		76,395			(2,858	)
Impairment loss of long-lived assets		-			-			-			-			-			-			-			-			-			-			-			-			-			-			(1,038,548	)		-			-			(1,038,548	)		1,038,548			-
Total operating expenses, net		(12,572	)		(18,562	)		(2,495	)		(3,922	)		(7,286	)		(30,276	)		(9,584	)		(2,874	)		(7,860	)		(2,521	)		(7,707	)		(99	)		(5,259	)		(18,273	)		(1,186,886	)		(68,301	)		(1,586	)		(1,386,063	)		1,260,440			(125,623	)
Operating profit (loss)		41,185			64,314			13,870			(13,363	)		33,607			1,880			68,137			(4,485	)		(3,405	)		4,125			748			43,974			(6,693	)		(21,525	)		(762,790	)		948,123			83,725			491,427			(276,184	)		215,243
Other income (expense),net
Share in the results of associates under equity method		-			-			-			-			-			-			-			-			(1,511	)		(3,140	)		-			-			(238,810	)		(104,219	)		-			-			-			(347,680	)		233,535			(114,145	)
Finance costs		(561	)		(832	)		(477	)		(544	)		(163	)		(47	)		(1,301	)		(344	)		(232	)		(1,992	)		(96	)		(5	)		(3	)		(3,731	)		(18,745	)		(1,843	)		(2,385	)		(33,301	)		23,405			(9,896	)
Net gain (loss) from currency exchange difference		325			92			63			64			(64	)		(4,544	)		(777	)		81			(111	)		(1,355	)		119			(66	)		(17	)		(985	)		2,065			(1,858	)		(524	)		(7,492	)		300			(7,192	)
Finance income		18			29			-			-			-			-			-			1			6			-			7			3			-			4,693			720			2,178			335			7,990			(1,369	)		6,621
Total other income (expense), net		(218	)		(711	)		(414	)		(480	)		(227	)		(4,591	)		(2,078	)		(262	)		(1,848	)		(6,487	)		30			(68	)		(238,830	)		(104,242	)		(15,960	)		(1,523	)		(2,574	)		(380,483	)		255,871			(124,612	)
Profit (loss) before income tax		40,967			63,603			13,456			(13,843	)		33,380			(2,711	)		66,059			(4,747	)		(5,253	)		(2,362	)		778			43,906			(245,523	)		(125,767	)		(778,750	)		946,600			81,151			110,944			(20,313	)		90,631
Income tax		-			-			-			-			-			(5,003	)		(29,211	)		(17	)		(72	)		(3,228	)		(269	)		(13,151	)		(67	)		(35,464	)		203,471			(333,338	)		(34,156	)		(250,505	)		164,023			(86,482	)
Profit (loss) from continued operations		40,967			63,603			13,456			(13,843	)		33,380			(7,714	)		36,848			(4,764	)		(5,325	)		(5,590	)		509			30,755			(245,590	)		(161,231	)		(575,279	)		613,262			46,995			(139,561	)		143,710			4,149
Loss from discontinued operations, see Note 1(e)																																																											(83,885	)
Net loss																																																											(79,736	)

Total assets		-			-			-			-			-			687,187			270,911			37,366			54,372			430,588			5,801			9,008			1,387,667			3,603,191			3,754,692			4,828,201			203,749			15,272,733			(10,720,466	)		4,552,267
Total liability		-			-			-			-			-			243,749			89,767			9,174			39,744			269,466			2,774			3,439			137			272,832			674,642			740,717			69,542			2,415,983			(1,688,137	)		727,846

Other segment information
Investment in associates		-			-			-			-			-			-			-			-			-			-			-			-			-			41,931			1,360,689			904,315			43,367			2,350,302			-			2,350,302
Additions to mining concessions, development costs, property, plant and equipment		16,038			11,023			8,927			16,643			16,233			216,477			89,308			89,313			12,307			48,532			126			-			-			42,699			-			-			-			567,626			-			567,626

F-89

Notes to the consolidated financial statements (continued)

Reconciliation of segment profit (loss)

The reconciliation of segment profit (loss) to the consolidated profit (loss) from continued operations follows:

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Segments loss		(1,017,074	)		(176,142	)		(139,561	)
Elimination of profit of equity accounted investees, not consolidated (owned by third parties)		203,912			(108,861	)		(195,573	)
Elimination of intercompany sales		(232,380	)		(242,022	)		(252,500	)
Elimination of intercompany cost of sales		228,914			229,968			238,620
Elimination of equity pick up loss of the subsidiaries and associates of the Parent company		448,691			261,514			347,680
Others		1,915			5,017			5,483

Consolidated profit (loss) from continued operations		(366,022	)		(30,526	)		4,149

Reconciliation of segment assets

The reconciliation of segment assets to the consolidated assets follows:

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Segments assets		17,303,094			16,184,466			15,272,733
Elimination of assets of equity accounted investees, not consolidated (owned by third parties)		(8,128,519	)		(6,727,205	)		(6,108,111	)
Elimination of equity pick up investments of the subsidiaries and associates of the Parent company		(4,486,717	)		(4,615,191	)		(4,398,677	)
Elimination of intercompany receivables		(138,703	)		(156,456	)		(203,236	)
Others		(1,974	)		(13,340	)		(10,442	)

Consolidated assets		4,547,181			4,672,274			4,552,267

Reconciliation of segment liabilities

The reconciliation of segment liabilities to the consolidated liabilities follows:

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Segments liabilities		5,451,667			3,228,256			2,415,983
Elimination of liabilities of equity accounted investees, not consolidated		(4,154,042	)		(2,162,006	)		(1,484,901	)
Elimination of intercompany payables		(138,703	)		(156,456	)		(203,236	)
Others		(977	)		355			-

Consolidated liabilities		1,157,945			910,149			727,846

F-90

Notes to the consolidated financial statements (continued)

~~(d)~~

On September 29, 2011, Laws 29788 and 29789 modified the Mining Royalties, and created the Special Mining Tax, respectively. Both laws establishes that the payments for mining royalties and special mining tax will be calculated using the quarterly operating income. Rates are establishes based on the gross margin, which is calculated dividing the quarterly operating income over the income generated on that period. The higher amount between the mining royalty and 1 per cent of the income generated by the quarterly sales is paid. Also it is required to pre-payments in advance for the months of October, November and December 2011. Laws were effective since October 1, 2011.

~~25.~~

~~Basic and diluted earnings per share~~

~~Basic earnings per share are computed by dividing net earnings for the period by the weighted average number of shares outstanding during the year.~~

In the table below is the composition of the number of shares outstanding as of December 31, 2012, 2011 and 2010, and the number of shares considered in the calculation of basic and diluted earnings per share:

Shares outstanding as of December 31, 2012, 2011 and 2010 Shares
(denominator in calculating earnings
per share considering treasury shares
acquired in 2012)
Common Investment Of treasury Total Common Investment Total
Common Investment

Balance at January 1, 2012, 2011 and 2010 274,889,924 744,640 (21,130,260 ) (61,976 ) 254,442,328 253,759,664 682,664 254,442,328

Treasury shares acquired during 2012 - - - (209,757 ) (209,757 ) - (209,757 ) (209,757 )
Balance at December 31, 2012, 2011 and 2010 274,889,924 744,640 (21,130,260 ) (271,733 ) 254,232,571 253,759,664 472,907 254,232,571

~~Computation of the earnings per share as of December 31, 2012, 2011 and 2010 is presented below:~~

2012 2011 2010

Attributable net income attributable to owners of the parent (numerator) – US$ 684,685,000 858,927,000 660,821,000
Shares (denominator) 254,232,571 254,442,328 254,442,328

Basic and diluted earnings per share – US$ 2.69 3.38 2.60

~~26.~~

~~Disclosure of information on segments~~

International Financial Reporting Standard (IFRS) 8 – “Operating Segments” requires that corporations present financial information taking into account the information reported that the chief operating decision maker uses internally for evaluating the performance of operating segments and allocating resources to those segments (a “through the eyes of management” approach).

The Company´s only reportable segment that meets the threshold for reporting is mining, these activities are executed through thirteen companies. The Company´s Management considers that these companies could be combined in one segment (mining) considering the financial performance and similar characteristic related to goods nature, production process nature, type of clients and legal environment. The electric segment, mining consulting and insurance are not significant in order to evaluate business development, reason why the Management considers mining the only reportable segment.

The Board of Directors has been identified as the responsible for approving the Company’s operational decisions. The Board of Directors is responsible for allocating resources and assessing performance as a single operating unit.

~~27.~~32.

Derivative financial instruments

(a)

The volatility of copper prices during the last years has caused the management of the subsidiary El Brocal to enter into future contracts. These contracts are intended to reduce the volatility of the cash flows attributable to the fluctuations in the cooper price, according to the risk strategy approved by the Board of Directors of this subsidiary. Based on this strategy, no more than 50% of existing sales commitments of copper concentrate are under future contracts.

~~Buenaventura~~

As of December 31, ~~2012 and 2011, Buenaventura had no derivative contracts.~~

~~El Brocal~~

2015, El Brocal ~~performed hedge transactions to hedge metals prices using anyone~~does not have open forward contracts (an asset of the derivative instruments existing in the financial market for up to a term of 3 years, for a total of no more than 25 percent of the estimated metal content of its annual production each year. El Brocal Board of Directors meeting of February 23, 2007 named a Hedging Committee to be responsible for approving all hedging transactions, after their contracting and/or execution. El Brocal maintains lines of credit without margin with brokers on the London Metals Exchange (LME).

~~(a)~~

~~Mineral quotes hedging operations -~~

As of December 31, 2012, the agreements related to the price hedge were already settled. These hedging derivatives held force since 2010, with the intention of covering the risk resulting from a fall in metal prices which markets El Brocal, so they signed contracts that qualify as cash flow hedging cash, which were recorded as assets or liabilities in the statement of financial position, and presented at fair value. In the case hedges were effective to offset future cash flows from the sale of the related production, changes in fair value are deferred in an equity account. The deferred amounts were reclassified to sales when the corresponding production was sold.

~~Cash-flow hedges operations~~US$3,688,000 as of December 31, ~~2012 were:~~

Metal Monthly
average
amount
MT Volume
amount
MT Fixed average
Price per
MT Periods Fair value
US$ US$(000)

Zero cost collar-option contracts
Copper 250 2,750 7,500 – 8,415 February – December 2012 638
Copper 250 2,750 7,500 – 8,425 February – December 2012 645

Fair value offinancial instruments 1,283

~~The~~2014, which balancing entry, net ~~change~~of the deferred income tax, amounted to a positive balance of US$2,485,000 and is presented in the ~~equity account “Other equity~~“other reserves” ~~for the twelve months ended as~~caption of ~~December 31, 2012 amounts to a loss of US$844,000 (gain of US$17,076,000 as of December 31, 2011 and a loss of US$11,442,000 as of December 31, 2010)~~equity).

(b)

~~The change in the consolidated statement of comprehensive income related to hedging instruments is as follows:~~

Hedge
derivative
financial
instruments Income tax
and mining
taxes Net change in
unrealized gain
(loss) on
hedging
derivative
financial
instruments
US$(000) US$(000) US$(000)

Balance as of January 1, 2010 (6,843 ) 2,053 (4,790 )
Loss from hedging transactions settled during the  period, note 18(a) (1,884 ) 565 (1,319 )
Unrealized gain on hedge derivative financial instruments (14,461 ) 4,338 (10,123 )
Total change in derivative financial instruments for hedging (16,345 ) 4,903 (11,442 )

Balance as of December 31, 2010 (23,188 ) 6,956 (16,232 )
Gain from hedging transactions settled during the  period, note 18(a) 8,681 (2,604 ) 6,077
Unrealized gain on hedge derivative financial instruments 15,790 (4,791 ) 10,999
Total change in derivative financial instruments for hedging 24,471 (7,395 ) 17,076

Balance as of December 31, 2011 1,283 (439 ) 844
Loss from hedging transactions settled during the  period, note 18(a) (72 ) 20 (52 )
Unrealized gain on hedge derivative financial instruments (1,211 ) 419 (792 )
Total change in derivative financial instruments for hedging (1,283 ) 439 (844 )

Balance as of December 31,  2012 - - -

~~(c)~~

Embedded ~~derivatives from changes in the provisional prices~~derivative of commercial ~~settlements~~contracts -

AsThe Group’s sales of ~~December 31, 2012 and 2011~~concentrates are based on commercial contracts, under which a provisional sales value is determined based on future quotations (forward). The adjustment to sales is considered an embedded derivative, which is required to be separated from the ~~changes in~~host contract. Commercial contracts are linked to market prices (London Metal Exchange) at the ~~fair value of embedded derivatives, were present in the “Net sales” caption~~dates of the ~~consolidated income statement. The futures quotes for the dates on which it is~~ expected ~~to settle~~settlements of the open positions as of December 31, ~~2012~~2015 and ~~2011~~2014. The embedded derivative does not qualify for hedge accounting; therefore, changes in the fair value are ~~taken from publications of the London Metals Exchange.~~recorded as an adjustment to net sales.

Embedded derivatives ~~from sales of concentrate~~ held by ~~Buenaventura and El Brocal~~the Group as of December 31, ~~2012:~~

Maturity Quotations Fair value,
Metal Amount 2013 Provisional Future net
US$ US$ US$(000)

Sale of concentrates

Gold 37,454 DMT January 1,651 - 1,750 1,652 - 1,740 513
Silver 2,258,731 Oz January – April 28.70 – 34.23 30.19 – 30.26 (5,129 )
Gold 179 DMT January – March 1,686 – 1,771 1,652 – 1,654 (9 )
Copper 36,076 DMT January – April 7,491 – 8,193 7,912 – 8,067 (887 )
Zinc 4,015 DMT January – February 1,810 – 2,037 1,987 – 2,066 68
Lead 4,926 Oz January – March 1,895 – 2,275 2,290 - 2,315 316
(5,128 )
Purchase of concentrates
Copper 1,136 DMT January 7,965 7,912 189
Total liability, net (4,939 )

~~Embedded derivatives from sales of concentrate held by Buenaventura and El Brocal as of December 31, 2011:~~2015 are:

~~Maturity~~

Quotations

~~Quotations~~

Metal

Quantity

Period of quotations 2016

Provisional

Future

Fair value, net

~~Fair value,~~

~~Metal~~

~~Amount~~

~~2012~~US$

~~Provisional~~US$

~~Future~~

~~net~~US$(000)

~~US$~~

Copper

41,359 DMT

January – April

4,629.00 – 5,223.05

4,525.50 – 4,796.00

~~US$(000)~~(1,549

)

Gold

16,145 OZ

~~6,713 DMT~~

January

961.79 – 1,070.10

1,086.65 – 1,109.09

(633

)

Silver

3,215,862 OZ

January – March

12.66 – 15.71

~~1,605.40 - 1,727.90~~

~~1,617.10 - 1,624.20~~

14.30 – 14.31

(~~296~~244

)

~~Silver~~Lead

~~1,451,655 Oz~~

16,990 DMT

January – April

1,641.40 – 1,732.13

~~29.38~~1,658.00 – ~~41.02~~1,789.00

408

~~28.83 - 28.91~~

Zinc

12,329 DMT

January – March

1,510.41 – 1,672.50

1,495.75 – 1,609.00

316

~~(7,713~~

)

~~Copper~~Gold

~~17,898 DMT~~

342 OZ

January – April

1,066.26 – 1,124.53

~~7,348.00~~1,109.05 – ~~9,040.34~~1,109.27

~~7,529.00 - 7,603.00~~

~~597~~8

~~Lead~~

~~9,273 DMT~~

~~January – April~~

~~1,945.00 - 2,457.78~~

~~1,987.00 - 2,025.00~~

~~(719~~

)

~~Zinc~~

~~1,581 DMT~~

~~January – March~~

~~1,914.97 - 2,011.75~~

~~1,821.25 - 1,830.25~~

~~(173~~

)

~~Gold~~

~~60,458 Oz~~

~~January~~

~~1,606.50 – 1,785.00~~

~~1,640.00 - 1,810.00~~

~~1,517~~

~~Other~~

Total asset, net

(~~519~~1,694

)

F-91

Notes to the consolidated financial statements (continued)

Embedded derivatives held by the Group as of December 31, 2014 are:

Quotations

Metal

Quantity

Period of
quotations 2015

Provisional

Future

Fair value, net

US$

US$(000)

Copper

67,815 DMT

January – June

6,408.10 – 6,907.73

6,118.00 – 6,186.00

(7,558

)

Silver

2,361,515 OZ

January – April

15.62 – 19.03

16.35 – 16.38

(631

)

Lead

6,975 DMT

January – April

1,869.30 – 2,178.60

1,840.00 – 1,851.88

(628

)

Zinc

13,521 DMT

January – March

2,171.71 – 2,380.00

2,122.50 – 2,129.25

(296

)

Gold

36,442 OZ

January – February

1,194.00 – 1,227.00

1,201.84 – 1,216.45

Total liability, net

(~~7,306~~9,072

)

~~28.~~(c)

Hedge of the risk of fluctuation of foreign exchange rates

During 2015, the volatility of the foreign exchange rate between the Soles and the U.S. dollars, which is the functional and reporting currency of Buenaventura and El Brocal, has driven the Group’s Management to undertake hedge contracts of foreign currency exposure over their bank loans mentioned in Note 14. Buenaventura and El Brocal have signed forwards hedging contracts, which have been designated as hedging derivative cash flow because they are intended to cover the risk of fluctuations in the exchange rates of the financial obligations in soles.

Key deadlines of the hedging contract have been negotiated to match the terms and amounts of their obligations.

As of December 31, 2015, fair value of these hedge derivate financial instruments over exchange rates of current bank loans is a liability of US$10,643,000 and the effectiveness of these contracts has not been observed since it has not arisen any significant element of ineffectiveness.

33.

Financial –- risk management objectives and policies

The ~~Company’s Management~~Group’s principal financial liabilities, other than derivatives, comprise of trade accounts ~~payable, bank loans~~ and ~~overdrafts~~other payables, and ~~debentures.~~financial obligations. The main purpose of these financial instruments is to ~~manage short-term cash flow and raise~~ finance ~~for~~ the ~~Company’s capital expenditure programme.~~Group’s operations. The ~~Group has various~~Group’s principal financial assets ~~such as~~include cash and cash equivalents and trade and other receivables ~~and cash and short-term deposits~~ that ~~arise~~derive directly from its operations.

The ~~Company’s Management manages its exposure~~Group is exposed to ~~key financial risks in accordance with the Company’s financial~~market risk, management policy. The objective of the policy is to support the delivery of the Company’s financial targets while protecting future financial security. The main risks that could adversely affect the Group’s financial assets, liabilities or future cash flows are market risks, comprising commodity price risk, cash flow interest rate risk and foreign currencycredit risk and liquidity ~~risk and credit~~ risk. ~~Management reviews and agrees policies for managing each of these risks that are summarized below.~~

The ~~Company’s~~Group’s Management oversees the management of ~~financial~~these risks. ~~The Group’s senior management~~It is supported by a ~~Financial Risk Committee~~committee that advises on financial ~~risks and the appropriate financial risk governance framework for the Group. The Financial Risk Committee~~risks. This committee provides assurance to ~~the Group’s senior~~ management that the ~~Group’s~~Group's financial ~~risk-taking~~risk activities are governed by appropriate policies and procedures and that financial risks are identified, measured and managed in accordance with the Group’s policies and risk objectives. All derivative activities for risk management ~~purposes~~purpose are carried out by ~~specialist teams~~internal specialists that have the appropriate skills, experience and supervision.

~~Financial instruments that are affected by market risks include accounts receivable, accounts payable, embedded derivatives~~There were no changes in the objectives, policies or processes during the years ended December 31, 2015 and ~~hedge derivative financial instruments.~~2014.

The Board of Directors reviews and ~~approves~~agrees policies ~~to manage~~for managing each of these risks, which are described below:

(a)

Market risk -

Market risk is the risk that the fair value of the future cash flows from financial instruments ~~should~~will fluctuate ~~as a result~~because of changes in market prices. ~~The market~~Market risks that apply to the ~~Company include~~Group comprise three types of risk: ~~exchange-rate~~exchange rate risk, commodity risk ~~of changes in the prices of minerals~~ and ~~interest-rate~~interest rate risk. Financial instruments affected by market risks include ~~loans,~~time deposits, financial obligations, embedded derivatives and derivative financial instruments.

F-92

Notes to the consolidated financial statements (continued)

The sensitivity ~~analysis~~analyses in this section ~~relates~~relate to the positions as of December 31, ~~2012~~2015, 2014 and ~~2011,~~2013, and ~~has~~have been prepared considering that the proportion of financial instruments in foreign currency ~~remains~~are constant.

(a.1)

~~Exchange-rate~~Exchange rate risk

The ~~Company bills~~exchange rate risk is the ~~sale~~risk that the fair value or future cash flows of ~~its products (locally and abroad) mostly~~a financial instrument will fluctuate because of changes in ~~United States dollars. Exchange-rate~~foreign exchange rates. The Group’s exposure to the risk ~~arises mainly from deposits and other accounts payable~~of changes in ~~Nuevos~~foreign exchange relates primarily to the Group´s operating activities in Soles. The ~~Company~~Group mitigates the effect of exposure to exchange-rate risk by carrying out almost all of its transactions in its functional currency.

On the other hand, the Group has contracted hedges exchange rate to mitigate this risk on their loans obtained in soles. Excluding loans in soles, Management ~~retains~~maintains smaller amounts in ~~Nuevos~~ Soles in order to cover its needs ~~(taxes and compensation)~~ in this ~~currency.~~currency (primarily taxes).

F-93

As of December 31, 2012, the Company had posted a net loss of US$1,715,000 from exchange differences (a net loss of US$675,000 and US$750,000 as of December 31, 2011 and 2010), from the translation of balances in Nuevos Soles

Notes to the ~~functional currency.~~consolidated financial statements (continued)

A table showing the effect on results of a reasonable change in foreign-currency exchange rates is presented below, with all other variables kept constant:

	Exchange-rate increase / decrease			Effect on earnings before income tax			Exchange-rate increase/decrease			Effect on loss before income tax
				US$(000)						US$(000)
2012
2015
Exchange rate		+10	%		8,854			+10	%		6,233
Exchange rate		-10	%		(10,563	)		-10	%		(7,618	)

2011
2014
Exchange rate		+10	%		8,638			+10	%		5,950
Exchange rate		-10	%		(10,333	)		-10	%		(7,271	)

2010
2013
Exchange rate		+10	%		3,032			+10	%		20,989
Exchange rate		-10	%		(3,617	)		-10	%		(25,225	)

(a.2)

~~Risk of prices~~Commodity price risk

~~Risk in mineral prices~~

~~International~~The Group is affected by the price ~~of minerals has an important impact on the results~~volatility of the ~~Company’s operations.~~commodities. The price of ~~the~~ mineral sold by the ~~Company~~Group has fluctuated historically and is affected by numerous factors beyond ~~the Company’s~~its control. The ~~Company~~Group manages ~~this~~its commodity price risk primarily through the use of sales commitments ~~with customers. The Company does not~~in customer contracts and hedge ~~its exposure to price fluctuation.~~

~~Buenaventura -~~

~~The Company does not have financial hedging instruments for managing this risk.~~

~~Embedded derivatives~~

~~The Company allocates a provisional sales value to the sales that are subject to future settlement pursuant to the commercial~~ contracts signed with its customers. Exposure to changes in the price of metals generates an embedded derivative that must be separated from the commercial contract. At each period’s closing, the value of provisional sales is adjusted in accordance with the estimated price for the ~~quotation period stipulated in~~metals sold by the ~~contract. Adjustment of the provisional sale value is posted as an increase or decrease in net sales. See note 2.3(p).~~subsidiary El Brocal.

The ~~estimated change~~subsidiary El Brocal entered into derivative contracts that qualified as cash flow hedges, with the intention of covering the risk resulting from the fall in the ~~price for sales pending final settlement, which is disclosed within~~prices of the ~~net sales~~metals. These derivative contracts are recorded as assets or liabilities in the statements of ~~embedded derivative to December 31, 2012, amounted to US$1,776,000 (note 27(c)).~~financial position and are stated at fair value. To the extent that these hedges were effective in offsetting future cash flows from the sale of the related production, changes in fair value are deferred in an equity account. The ~~estimate corresponding to such settlements as closed in January 2012~~deferred amounts were ~~reduced by 10 percent with respect~~reclassified to the ~~actual value settled. In the case of settlements that still maintain their provisional value as of December 31, 2010; their estimate~~appropriate sales when production was ~~also reduced by 36 percent due to the drop in metals prices since the month of January (liquidations that were closed in January 2012 were increased (greater loss) at 10 percent).~~

~~El Brocal -~~

As of December 31, 2012, the Company does not hold hedging instruments. Regarding future prices as of December 31, 2011 and the market value at that time of the position of derivative financial instruments contracted by the Brocal presents a sensitivity analysis of the market value of this position on a variation of around 10 percent for the relevant prices, while all other variables held constant:sold.

	~~Effect on unrealized~~ ~~gain (loss) on hedge~~ ~~derivative financial~~ ~~instruments, net~~
	~~US$(000)~~

~~2011~~
~~Increase of 10 percent in future quotes~~
~~Hedges in effect for 2012~~		~~(2,047~~	)

~~Decrease of 10 percent in future quotes~~
~~Hedges in effect for 2012~~		~~4,661~~

(a.3)

~~Interest-rate~~Interest rate risk -

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates. The ~~Company is~~Group’s exposure to ~~interest-rate~~the risk ~~change especially by its~~of changes’ in market interest rates relates to the Groups’ long-term financial ~~obligations.~~obligations with floating interest rates.

F-94

Notes to the consolidated financial statements (continued)

~~In the case, the interest-rate subject to the long-term financial obligation changes on the order of 10 percent for LIBOR rate as of December 31, 2012 and 2011 respectively,~~A table showing the effect ~~on income before income tax had not been significant. The effect is shown below:~~in profit or loss of the variations of interest rates:

	Increase / decrease in Libor rate					increase/decrease of Libor rate		Effect on results
	(percentage points)		Assets US$(000)			(percentage rates)		US$(000)

2012
2015
Interest rate		+10.0		57			+10		294
Interest rate		-10.0		(57	)		-10		(294	)

2011
2014
Interest rate		+10.0		1			+10		110
Interest rate		-10.0		(1	)		-10		(110	)

2013
Interest rate							+10		58
Interest rate							-10		(58	)

(b)

Credit risk -

Credit risk is the risk that counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The ~~Company’s~~Group is exposed to credit risk ~~arises~~ from its operating activities (primarily trade receivable) and from its financing activities, including deposits with banks and other financial instruments.

The Group invests the ~~inability of debtors to be able to fulfill their obligations, to the extent to which they are overdue. Therefore, the Company deposits its~~ excess ~~funds~~cash in financial leading ~~financial~~ institutions, ~~establishes~~sets conservative credit policies and constantly evaluates ~~conditions of~~ the market conditions in which it ~~is involved, for which it uses risk-rating reports for commercial and credit transactions.~~

There is concentration-of-credit risk when there are changes in the economic, industrial or geographic factors that equally affect the counterparts related to the Company. The Company’s gold and concentrate sales are made to companies of recognized national and international prestige. Transactions are executed with various counterparts with credit solvency, which mitigates any significant concentration of credit.operates.

Trade accounts receivable are denominated in U.S. ~~dollars; their due dates are the dates of emission on the proof of payment, which amounts becomes cash in days following their due dates.~~dollars. The ~~Company’s~~Group’s sales ~~of the Company~~ are made to domestic and foreign ~~customers; as of December 31, 2012 it had a portfolio of 19 customers (14 customers as of December 31, 2011).~~customers. See concentration of spot sales in ~~note 18(b)~~Note 21(b). ~~The Company performs~~An impairment analysis is performed on an ~~assessment on those debts whose collection is estimated as a variable to determine the allowance for doubtful accounts.~~individual basis.

Credit risk is limited to the ~~book value~~carrying amount of the financial assets asto the date of ~~the~~ consolidated ~~statement~~statements of financial position ~~date. These assets consist mainly of~~which is composed by cash and cash equivalents, trade ~~accounts receivable,~~and other ~~accounts receivable~~receivables and derivative financial instruments.

~~Collections in January 2013 amounted to US$175,358,000, which represents 68 percent of the balances receivable as of December 31, 2012.~~

(c)

Liquidity risk -

Prudent management of liquidity risk implies maintaining sufficient cash and cash equivalents and the possibility of committing or having financing committed through an adequate number of credit sources. The ~~Company~~Group maintains suitable levels of cash and cash ~~equivalents; its shareholders also include companies with economic backing~~equivalents and it has sufficient credit capacity to ~~allow it to have~~get access to lines of credit in leading financial entities.

The ~~Company~~Group continually monitors its liquidity ~~reserves~~risk based on cash flow projections.

F-95

Notes to the consolidated financial statements (continued)

An analysis of the ~~Company’s~~Group’s financial liabilities classified according to their aging is presented below, ~~considering the period from their due date to the consolidated statement of financial position:~~based on undiscounted contractual payments:

Less than
1 year Between
1 and 2
years Between
2 and 5
years More than
5 years Total
US$(000) US$(000) US$(000) US$(000) US$(000)

As of December 31, 2012
Trade accounts payable 199,551 - - - 199,551
Long-term debt (principal and interest) 6,116 29,832 29,712 122,925 188,585
Other accounts payable 58,603 - - - 58,603

Total 264,270 29,832 29,712 122,925 446,739

As of December 31, 2011
Trade accounts payable 142,375 - - - 142,375
Long-term debt (principal and interest) 1,085 857 55,519 53,001 110,462
Embedded derivatives for concentrates sales 7,306 - - - 7,306
Other accounts payable 41,150 - - - 41,150

191,916 857 55,519 53,001 301,293

	Less than 1 year		Between 1 and 2 years		Between 2 and 5 years		More than 5 years		Total
	US$(000)		US$(000)		US$(000)		US$(000)		US$(000)

As of December 31, 2015 -
Bank loans		298,984		-		-		-		298,984
Trade and other payables		235,691		-		-		15,057		250,748
Derivative financial instruments		10,643		-		-		-		10,643
Embedded derivative for sale of concentrates		1,694		-		-		-		1,694
Financial obligation		62,560		92,571		238,504		-		393,635
Contingent consideration liability		-		-		8,050		29,118		37,168

Total		609,572		92,571		246,554		44,175		992,872

As of December 31, 2014 -
Bank loans	40,600	-	-	-	40,600
Trade and other payables	237,937	-	-	15,240	253,177
Embedded derivative for sale of concentrates	9,072	-	-	-	9,072
Financial obligation	71,196	47,673	135,178	130,504	384,551
Contingent consideration liability	-	-	5,463	36,156	41,619

Total	358,805	47,673	140,641	181,900	729,019

(d)

Capital management -

For purposes of the Group's capital management, capital is based on all equity accounts. The objective of capital management is to safeguard the Company’s capacity to continue as a going concern for the purpose of providing returns for shareholders, benefits for the stakeholders and maintaining an optimal structure that allows reducing the cost of capital.maximize shareholder value.

The ~~Company~~Group manages its capital structure and makes adjustments to ~~confront changes in~~meet the ~~market’s~~changing economic market conditions. The ~~Company’s~~Group's policy is to ~~finance~~fund all ~~its~~projects of short and ~~long-term projects~~long term with ~~its~~their own operating resources. ~~In order to~~To maintain or ~~adapt~~adjust the capital structure, the ~~Company~~Group may ~~amend~~change the policy ~~for dividend payments~~of paying dividends to shareholders, return capital to ~~its~~ shareholders or issue new shares. ~~There were no changes in objectives, policies or procedures during~~

F-96

Notes to the ~~years ending December 31, 2012 and 2011.~~consolidated financial statements (continued)

~~29.~~34.

Fair value ~~of financial instruments~~measurement

Fair value ~~is defined as~~disclosure of assets and liabilities according to its hierarchy -

The following table provides the ~~amount at which~~fair value measurement hierarchy of the Group’s assets ~~would be exchanged or liabilities settled between knowing~~ and ~~willing parties in an arm’s length transaction, under the assumption is a going concern entity.~~liabilities:

			Fair value measurement using
	Total		Quoted prices in active markets (Level 1)		Significant observable inputs (Level 2)		Significant non-observable inputs (Level 3)
	US$(000)		US$(000)		US$(000)		US$(000)

As of December 31, 2015
Liabilities measured at fair value:
- Embedded derivatives for concentrates sales, net		1,694		-		1,694		-
- Contingent consideration liability		16,994		-		-		16,994
- Hedge instruments		10,282		-		10,282		-

As of December 31, 2014
Assets measured at fair value:
Financial assets at fair value with changes in profit or loss		3,688		-		3,688		-
Liabilities measured at fair value:
Derivative financial liabilities:
- Embedded derivatives for concentrates sales, net		9,072		-		9,072		-
- Contingent consideration liability		23,026		-		-		23,026

When a financial instrument is traded in a liquid and active market, its price as set in a real market transaction offers the best evidence of its fair value. When no price is set in the market or the latter may not be indicative of the instrument’s fair value, the market value of another substantially similar instrument, the analysis of discounted flows or other applicable techniques may be used to determine this fair value, which is materially affected by the assumptions used. Although Management has used its best judgment in estimating the fair values of its financial instruments, any technique for making these estimates entails a certain level of inherent fragility. As a result, fair value may not be indicative of the net realizable or liquidation value of financial instruments.

Financial instruments whose fair value is similar to their book value –-

For financial assets and liabilities ~~which~~such as cash and cash equivalents, trade and other receivables, trade and other payables that are liquid or have short-term ~~maturity~~maturities (less than three months), ~~such as cash and cash equivalent, accounts receivable, other accounts receivable, accounts receivable from associates, accounts payable and other current liabilities,~~ it is estimated that their book value is similar to their fair value. The derivatives are also recorded at the fair value so that differences do not need to be reported.

The fair value of embedded derivatives is determined using valuation techniques ~~using~~with information directly observable in the market ~~(forward prices of metals)~~(future metal quotations).

Financial instruments at fixed and variable rates –-

The fair value of financial assets and liabilities at fixed and ~~variablerates~~variable rates at amortized cost is determined by comparing the market interest rates at the time of their initial recognition to the current market rates with regard to similar financial instruments. The estimated fair value of deposits that accrue interest is determined by means of cash flows discounted using the prevailing market interest rates in the currency with similar maturities and credit risks.

Based on the foregoing, there are no ~~significant differences~~important existing difference between ~~book~~the value in books and ~~fair~~the reasonable value of the assets and financial ~~instruments (assets and liabilities)~~liabilities as of December 31, ~~2012~~2015 and ~~2011.~~2014.

F-97

~~Fair value hierarchy -~~

~~The~~

Minera Yanacocha S.R.L. and Subsidiary

Consolidated Financial Statements for the years 2015, 2014 and 2013 together with the Report of Independent Auditors

F-98

Minera Yanacocha S.R.L. and Subsidiary

Consolidated Financial Statements for the years 2015, 2014 and 2013, together with the Report of Independent Auditors

Content

Report of Independent Auditors	F-100

Consolidated Financial Statements
Consolidated statements of financial position	F-102
Consolidated statements of comprehensive income	F-103
Consolidated statements of changes in equity	F-104
Consolidated statements of cash flows	F-105
Notes to the consolidated financial statements	F-106

F-99

Report of Independent Registered Public Accounting Firm

To the Shareholders of Minera Yanacocha S.R.L. and Subsidiary

We have audited the accompanying financial statements of Minera Yanacocha S.R.L. (a Peruvian Company ~~uses~~and subsidiary of Newmont Mining Corporation), which comprise the ~~following hierarchy for determining and disclosing the fair value~~consolidated statements of financial ~~instruments which are measured at fair value by valuation technique:~~

~~Level 1:~~

~~Quoted (unadjusted) prices in active markets for identical assets or liabilities.~~

~~Level 2:~~

~~Other techniques for which all inputs or data different from the quoted price of Level 1 are observable, either directly or indirectly.~~

~~Level 3:~~

~~Techniques which use inputs which have a significant effect on the recorded fair value that are not based on observable market data.~~

~~The financial instruments measured at fair value used by the Company, use level 2 valuation techniques in the periods ended~~position as of December 31, 2012 and 2011. This financial instrument is related to the embedded derivative based on the future price of copper on the expected date of settlement. As of December 31, 2012 and 2011, the balance of those items was a liability of US$4,939,000 and of US$7,306,000, respectively.

~~There has been no transfer between fair value levels during 2012 neither 2011.~~

~~30.~~

~~Commitments and contingencies~~

~~(a)~~

~~Environmental -~~

~~Buenaventura -~~

~~The Company’s exploration and exploitation activities are subject to environmental protection standards.~~

Law No. 28090 regulates the obligations and procedures that must be met by the holders of mining activities for the preparation, filing and implementation of Mine Closure Plans, as well as the establishment of the corresponding environmental guarantees to secure fulfillment of the investments that this includes, subject to the principles of protection, preservation and recovery of the environment.

Law No. 28271 regulates environmental liabilities in mining activities. This Law has the objectives of ruling the identification of mining activity’s environmental liabilities and financing the remediation of the affected areas. According to this law, environmental liabilities refer to the impact caused to the environment by abandoned or inactive mining operations.

In compliance with the above-mentioned laws, the Company presented preliminary environmental studies and Environmental Adaptation and Management Programs (EAMP) for mining units. The Ministry of Energy and Mines has approved the EAMP presented by the Company for its mining units and exploration projects. See detail of plans approved in note 14(a).

~~El Brocal -~~

In July 2012, in compliance with current environmental legislation on the closure of the mining units in operation, El Brocal commissioned a company authorized by the Peruvian government to developed a new closure plan for their production unit Colquijirca.

On July 12, 2012, the Company presented the Update Mine Closure Plan Colquijirca where new obligations include closure caused by the expansion of operations. The main changes are related to the closure update clearing deposits and tailings impoundments, decommissioning and dismantling of the concentrator plant expansion to 5,000 DMT/day to 7,000 DMT/day and 10,500 new concentrator DMT/day. The new Mine Closure Plan was approved by a nominal value of US$52,952,000.

~~Cerro Verde -~~

On September 2012, according as established by the current legal regulations, Cerro Verde presented to the Ministry of Energy and Mines an updated mine closure plan, in which the remediation and mine closure budget was updated. As a result and pursuant to the accounting policies of Cerro Verde increased the liability for mine closure remediation at US$72,512,000 and the mine closure asset by the same amount.

The increase presented in the mine closure plan in 2012 was due to the update of costs related to the future closure of platform 4B and additional deposits for clearing. Additionally, as a result of the Expansion Project, the useful life of the mine and exploration time has been significantly reduced. The Company considers that this liability is sufficient to meet the current environmental protection laws approved by the MEM. Cerro Verde has issued letters of credit to Ministry of Energy and Mines amounting to US$12,838,000 to secure mine closure plans for its mining unit.

~~The Company believes that the liability recorded is sufficient to meet the current regulatory environment in Peru.~~

~~(b)~~

~~Leased concessions -~~

~~Sindicato Minero Orcopampa S.A. -~~

~~The Company pays 10 percent on the valued production of mineral obtained from the concessions leased by Sindicato Minero Orcopampa S.A. This concession is in force until the year 2043. See note 21.~~

~~Minera El Futuro de Ica S.R.L. -~~

Inminsur entered into a contract with Minera El Futuro de Ica S.R.L. to operate leased mining concessions in the department of Arequipa. The contractual terms establish that the lease is subject to payment of a royalty equivalent to seven percent of the monthly value of the sale of concentrates. As part of the merger with Buenaventura, the contract will be in force until the year 2015. See note 21.

~~(c)~~

~~Purchase option contracts -~~

During the ordinary course of business, the Company executes contracts to undertake exploration works in third-party concessions. Under the terms of these contracts, the Company generally has an option to acquire the concession or to invest in it in order to earn a share in the holding company. In order to exercise these options, the Company must fulfill certain obligations during the contract term. The Company’s failure to perform the obligations established therein is usually grounds for termination of these contracts.

The Company may terminate these contracts at any time during their terms, generally after having performed at least the minimum obligations established. Along this line, the Company constantly analyzes the advisability of whether or not to continue with such contractual relationships.

~~(d)~~

~~Legal procedures -~~

~~Buenaventura -~~

Buenaventura is a party in legal procedures that have arisen in the normal course of its activities; nevertheless, in the opinion of Buenaventura’s Management, none of these procedures, in particular or as a whole, could result in material contingencies.

~~Yanacocha -~~

~~Mercury spill in Choropampa~~

Yanacocha has entered into settlement agreements with a number of individuals impacted by the incident. As compensation for the disruption and inconvenience caused by the incident, Yanacocha entered into agreements with and provided a variety of public works in the three communities impacted by this incident. Yanacocha cannot predict the likehood of additional expenditures related to this matter.

Additional lawsuits relating to the Choropampa incident were filed against Yanacocha in the local courts of Cajamarca, Peru, in May 2002 by over 900 Peruvian citizens. A significant number of the plaintiffs in these lawsuits entered into settlement agreements with Yanacocha prior to filing such claims. In April 2008, the Peruvian Supreme Court upheld the validity of these settlement agreements, which should result in the dismissal of all claims brought by previously settled plaintiffs. Yanacocha has also entered into settlement agreements with approximately 350 additional plaintiffs. The claims asserted by approximately 212 plaintiffs remain. In December 2010, Yanacocha resolved 4 additional claims which should result in the dismissal of all claims brought by previously settled plaintiffs. Yanacocha cannot reasonably predict the final outcome or estimate the possible loss relating to such claims. The maximum additional expense related to these judicial claims is estimated at US$1.5 million.

~~Baños del Inca~~

In September 2006 the Municipality of Baños del Inca issued a declaration designating an area that includes the Carachugo Expansion and San Jose Projects as reserved and protected areas. Based on previous experience and actions taken by the Constitutional Tribunal (Peru Court of Last instance for Constitutional issues) in respect of Cerro Quilish in which it was ruled that such declaration did not affect Yanacocha’s mining rights, Yanacocha believes that Baños del Inca’s declaration, should not impact the Yanacocha’s legal rights to exploit these concessions. The legal proceeding is currently pending resolution in Lima’s Court of First Instance.

~~In March 2008, the Lima Court rejected a Baños del Inca Municipality request which did not recognize Lima’s Jurisdiction.~~

~~San Pablo~~

In February 2007 the Municipality of San Pablo issued an ordinance designating an area that includes Las Lagunas and Pozo Seco as reserved and protected areas, where Yanacocha has mining rights. Based on previous experience and actions taken by the Constitutional Tribunal in respect of Cerro Quilish in which it was ruled that such declaration did not affect Yanacocha’s mining rights, Yanacocha believes that San Pablo’s declaration, should not impact Yanacocha’s legal rights to exploit these concessions. Yanacocha has challenged this ordinance on the grounds that, under Peruvian law, local governments lack the authority to create such areas, denying the rights granted by Yanacocha’s mining concessions. The Court in the First Instance rejected the complaint based on formal grounds. The resolution of the Court was appealed before Lima’s Court of Second Instance.

~~In November 2008, Lima’s Court affirmed the ruling from the First Instance. In December 2011, Constitutional Court accepts the complaint. The process is currently pending resolution.~~

~~Clínica Internacional, Addeco, SDC Security~~

Workers of three contractors companies (Clínica Internacional, Adecco and SDC Security) have initiated judicial proceedings through which they demand their incorporation into Minera Yanacocha´s payroll. The workers deem they are direct employees of Yanacocha with all the rights, arguing that they receive direct orders from Minera Yanacocha and that most of the equipment they use is given by Yanacocha. All proceedings, which involve a total of 85 workers, are pending First Instance resolution.

~~(e)~~

~~Tax procedures -~~

~~Cerro Verde –~~

SUNAT has assessed mining royalties on materials processed by Cerro Verde concentrator which commenced operations in late 2006. These assessments cover the period October 2006 to December 2007 and the years 2008 and 2009. SUNAT has issued rulings denying Cerro Verde’s protest of the assessments. Cerro Verde has appealed these decisions and currently has three cases pending before the Peruvian Tax Tribunal. Cerro Verde is challenging these royalties because it believes its stability agreement provides an exemption for all minerals extracted from its mining concession, irrespective of the method used for processing those minerals. Although we believe our interpretation of the stability agreement is correct, if Cerro Verde is ultimately found responsible for these assessments, the amount of royalty and related interest payable would be significant. SUNAT may continue to assess mining royalties annually until this matter is resolved by the Peruvian Tax Tribunal.

~~F-105~~

~~31.~~

~~Transactions with associates companies~~

~~(a)~~

~~The Company has carried out the following transactions with its associates in the years 2012, 2011 and 2010:~~

2012 2011 2010
US$(000) US$(000) US$(000)

Transactions with Minera Yanacocha S.R.L.:
Paid royalties to:
S.M.R.L. Chaupiloma Dos de Cajamarca 67,178 62,742 55,883

Services received by:
Buenaventura Ingenieros S.A (Implementation of specific work orders) 4,440 11,579 1,575
Consorcio Energético de Huancavelica S.A. (Electric power transmission) 1,681 4,279 4,788

Transactions with Compañía Minera Coimolache S.A.:
Received dividends 16,467 - -
Loan - 24,232 -
Expenses recovery of exploration projects - - 15,013

Contributions made to associates:
Canteras del Hallazgo S.A.C. 26,410 32,208 16,358
Compañía Minera Coimolache S.A. - 5,221 -

~~(b)~~

~~Compañía Minera Coimolache S.A. (“Coimolache”) -~~

On October 18, 2010, the Shareholders´Meeting of Compañía Minera Coimolache S.A. approved the development program and financial support of Tantahuatay Project; the total budget of the project was estimated in US$110,000,000 and the project financing structure should be: 30 percent shareholders´s equity and 70 percent loans from shareholders. The account receivable to Coimolache has been recovered and generates a calculated interest with a LIBOR interest rate to 6 months plus 3 percent. During the months of June, August and November 2012, the collections made amounted to US$13,423,000.

~~(c)~~

~~As a result of the transactions indicated before, the Company had the following accounts receivable from associates:~~

2012 2011
US$(000) US$(000)
Accounts receivable
Compañía Minera Coimolache S.A. 39,166 53,971
Minera Yanacocha S.R.L. 16,513 25,441
Other 232 275
55,911 79,687
Less – non-current portion
Compañía Minera Coimolache S.A. (33,377 ) (32,262 )
Non-current portion (33,377 ) (32,262 )

Current portion 22,534 47,425

Accounts payable
Compañía Minera Coimolache S.A. 1,018 1,293
Minera Yanacocha S.R.L. 603 594
1,621 1,887
Less – non-current portion
Compañía Minera Coimolache S.A. (731 ) (1,004 )
Current portion 890 883

~~(d)~~

As of December 31, 2012 and 2011, directors, officers and employees of the Company have been involved, directly and indirectly, in credit transactions with certain subsidiaries. As of December 31, 2012 and 2011, officers and employees of the Company have been involved, directly and indirectly, in credit transactions with certain subsidiaries. As of December 31, US$1,474,000 and US$1,025,000, respectively; said loans are paid monthly and earn interest at market rates.

~~There are no loans to the Company’s directors and key personnel guaranteed with Buenaventura or any of its Subsidiaries’ shares.~~

~~(e)~~

~~The Company’s key executives’ compensation (including the related income taxes assumed by the Company) as of December 31, 2012 and 2011:~~

2012 2011
US$(000) US$(000)
Accounts payable:
Share-based compensation plans, note 14(c) 28,258 43,188
Directors’ compensations, note 14 2,721 3,567
Salaries 1,362 4,302

Total 32,341 51,057
Disbursements by:
2012 2011
US$(000) US$(000)

Share-based compensation plans, note 14(c) 16,729 20,499
Salaries 10,824 8,461

Total 27,553 28,960

~~MINERA YANACOCHA S.R.L.~~

~~CONSOLIDATED FINANCIAL STATEMENTS~~

~~DECEMBER 31, 2012~~

~~CONTENTS~~	~~Page~~

~~Report of the Independent Registered and Certified Public Accounting Firm~~	~~F-110~~

~~Consolidated Statements of Income and Comprehensive Income~~	~~F-111~~

~~Consolidated Statements of Cash Flows~~	~~F-112~~

~~Consolidated Balance Sheets~~	~~F-113~~

~~Consolidated Statements of Changes in Partners’ Equity~~	~~F-114~~

~~Notes to the Consolidated Financial Statements~~	~~F-115~~

~~REPORT OF THE INDEPENDENT REGISTERED AND CERTIFIED PUBLIC~~
~~ACCOUNTING FIRM~~

~~To the Partners and the Executive Committee of~~
~~Minera Yanacocha S.R.L.~~

~~March 25, 2013~~

~~In our opinion, the accompanying consolidated~~ ~~balance sheets~~2015, and the related c~~onsolidated~~consolidated statements of ~~income and~~ comprehensive income, statements of changes in ~~partners’~~ equity and ~~cash flows, present fairly, in all material respects, the financial position~~statements of~~Minera Yanacocha S.R.L.at December 31, 2012 and 2011, and the results of their operations and its~~ cash flows for ~~each of~~ the ~~three years in the period~~year ended December 31, ~~2012 in conformity with accounting principles generally accepted in the United States of America.~~2015. These financial statements are the responsibility of the ~~Company’s~~Company's management. Our responsibility is to express an opinion on these ~~consolidated~~ financial statements based on our audits.

We conducted our audits ~~of these financial statements~~ in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the ~~audits~~audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Company´s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis of designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company´s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

F-100

Report of Independent Registered Public Accounting Firm (continued)

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of Minera Yanacocha S.R.L. and subsidiary as of December 31, 2015, and the results of their operations and their cash flows for the year then ended, in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board (“IASB”) which differ in certain respects from the accounting principles generally accepted in the United States of America (see Note 25 to the financial statements).

Lima, Peru,

February 25, 2016

Countersigned by:

Paredes, Zaldívar, Burga & Asociados S. Civil de R.L.

/s/ Victor Burga
Víctor Burga
C.P.C.C. Register No.14859

F-101

PRICEWATERHOUSECOOPERS

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

March 30, 2015

To the shareholders of

Minera Yanacocha S.R.L.

In our opinion, the accompanying balance sheet and the related income statements, statements of changes in shareholders’ equity and cash flows statements, present fairly, in all material respects, the financial position of Minera Yanacocha S.R.L at December 31, 2014, and the results of its operations and its cash flows for catch of the two years in the period ended December 31, 2014 in conformity with International Financial Reporting Standards.

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits of these financial statements in accordance with the International Audit Standards approved for application in Peru by the Board of Deans of the Institute of Chartered Accountants of Peru. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. And audit of financial statements includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by ~~management,~~managements, and evaluating the overall financial ~~statement~~statements presentation. We believe that our audits provide a reasonable basis for our opinion.

/s/ ~~Dongo-Soria~~ Gaveglio, Aparicio y Asociados

Countersigned by

~~/s/ Fernando Gaveglio~~

~~(partner)~~

/s/ Fernando Gaveglio

Fernando Gaveglio

Peruvian ~~Certified~~ Public Accountant

Registration ~~No.01-19847~~No. 01-019847

~~F-110~~

~~CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME~~

Years Ended December 31,
2012 2011 2010
(dollars in thousands)

Revenues $ 2,201,815 $ 2,002,602 $ 1,778,260

Costs and expenses
Costs applicable to sales⁽¹⁾ 694,146 738,336 655,007
Amortization 252,900 231,520 160,424
Reclamation and remediation 20,090 19,135 14,632
Exploration 39,975 23,913 10,924
Write-down of long-lived assets 17,577 1,864 312
Advanced projects 81,749 42,359 23,625
Other expense, net (Note 3) 112,995 40,474 58,002
1,219,432 1,097,601 922,956

Other income (expense)
Other income, net (Note 4) 6,580 30,841 7,313
Interest expense, net of capitalized interest of nil, and $4,404, respectively (566 ) (417 ) (3,050 )
6,014 30,424 4,263

Income before income and mining tax 988,397 935,425 859,567
Income and mining tax expense (Note 5) (361,857 ) (293,038 ) (269,673 )
Net income 626,540 642,387 589,894

Other comprehensive income (loss) 1,129 (1,511 ) 1,149
Comprehensive income $ 627,669 $ 640,876 $ 591,043

F-102

⁽¹⁾

~~Excludes Amortization and Reclamation and remediation~~

~~The accompanying notes are an integral part of these~~c~~onsolidated financial statements.~~

~~F-111~~

~~CONSOLIDATED STATEMENTS OF CASH FLOWS~~

Years Ended December 31,
2012 2011 2010
(dollars in thousands)
Operating activities:
Net income $ 626,540 $ 642,387 $ 589,894
Adjustments to reconcile net income to net cash provided from operating activities:
Amortization 252,900 231,520 160,424
Deferred income tax 4,648 (2,854 ) 3,932
Deferred workers’ profit participation 1,347 (1,170 ) 985
Reclamation and remediation 20,090 19,135 14,632
Write-down fixed assets 17,550 - -
Other operating adjustments 5,279 (1,280 ) 762
Decrease (increase) in operating assets:
Inventories, stockpiles and ore on leach pads (15,481 ) 21,346 (111,255 )
Other assets 19,698 (53,010 ) 15,757
Increase (decrease) in operating liabilities:
Accounts payable and other accrued liabilities 11,752 61,369 (48,562 )
Reclamation liabilities (7,661 ) (5,882 ) (5,191 )
Net cash provided from operations 936,662 911,561 621,378

Investing activities:
Additions to property, plant and mine development (1,147,757 ) (994,440 ) (297,257 )
Investments in marketable debt securities - (3,240 ) -
Proceeds from marketable securities - 3,588 -
Proceeds from sale of assets 31,155 1,593 509
Net cash used in investing activities (1,116,602 ) (992,499 ) (296,748 )

Financing activities:
Repayment of debt - (1,959 ) (176,377 )
Net cash used in financing activities - (1,959 ) (176,377 )

Net change in cash and cash equivalents (179,940 ) (82,897 ) 148,253
Cash and cash equivalents at beginning of the year 797,991 880,888 732,635
Cash and cash equivalents at end of the year $ 618,051 $ 797,991 $ 880,888

~~See Note 17 for supplemental cash flow information.~~

~~The accompanying notes are an integral part of these~~c~~onsolidated financial statements.~~Minera Yanacocha S.R.L. and Subsidiary

~~F-112~~

Consolidated statements of financial position

~~CONSOLIDATED BALANCE SHEETS~~As of December 31, 2015 and 2014

At December 31,
2012 2011
(dollars in thousands)
ASSETS
Cash and cash equivalents $ 618,051 $ 797,991
Accounts receivable (Note 7) 100,539 74,608
Due from related parties (Note 12) 17,205 1,224
Inventories (Note 8) 87,413 63,501
Stockpiles and ore on leach pads (Note 9) 145,546 159,713
Deferred income tax assets (Note 5) 4,378 8,746
Other current assets (Note 10) 22,334 21,643
Current assets 995,466 1,127,426

Property, plant and mine development, net (Note 11) 3,120,173 2,231,212
Stockpiles and ore on leach pads (Note 9) 352,086 351,942
Other long-term assets (Note 10) 73,810 76,654
Total assets $ 4,541,535 $ 3,787,234

LIABILITIES

Accounts payable $ 114,803 $ 114,407
Due to related parties (Note 12) 49,399 35,316
Workers’ profit participation (Note 13) 45,225 42,349
Income tax payable 13,862 19,765
Other current liabilities (Note 14) 145,078 192,742
Current liabilities 368,367 404,579

Reclamation and remediation liabilities (Note 15) 507,943 343,277
Deferred workers’ profit participation (Note 13) 18,327 16,980
Deferred income tax liabilities (Note 5) 74,042 68,910
Other long-term liabilities 2,166 10,467
Total liabilities $ 970,845 $ 844,213

Commitments and contingencies (Note 19)

PARTNERS’ EQUITY
Partners’ contributions 398,216 398,216
Additional contributions 226 226
Accumulated other comprehensive income 2,006 877
Retained earnings 3,170,242 2,543,702
Total partners’ equity (Note 16) 3,570,690 2,943,021
Total liabilities and partners’ equity $ 4,541,535 $ 3,787,234

~~The accompanying notes are an integral part of these~~c~~onsolidated financial statements.~~

~~F-113~~

~~CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS’ EQUITY~~

Partners’
Contributions Additional
Contributions Retained Earnings Accumulated Other
Comprehensive
Income Total Partners’
Equity

Balance at January 1, 2010 $ 398,216 $ 226 $ 1,311,421 $ 1,239 $ 1,711,102
Unrealized gain on marketable securities, net of income tax - - - 1,149 1,149
Net income - - 589,894 - 589,894
Balance at December 31, 2010 $ 398,216 $ 226 $ 1,901,315 $ 2,388 $ 2,302,145
Unrealized gain on marketable securities, net of income tax - - - (1,511 ) (1,511 )
Net income - - 642,387 - 642,387
Balance at December 31, 2011 $ 398,216 $ 226 $ 2,543,702 $ 877 $ 2,943,021
Unrealized gain on marketable securities, net of income tax - - - 1,129 1,129
Net income - - 626,540 - 626,540
Balance at December 31, 2012 $ 398,216 $ 226 $ 3,170,242 $ 2,006 $ 3,570,690

	Note	2015		2014
		US$(000)		US$(000)
Current assets
Cash and cash equivalents	5		943,761		786,624
Trade and other receivables, net	6		26,389		68,231
Value added tax credit			80,641		84,342
Inventories, net	7		56,764		64,903
Stockpiles and ore on leach pads	8		237,610		270,511
Prepaid expenses			517		677
Total current assets			1,345,682		1,275,288

Non-current assets
Available-for-sale financial assets	9		15,803		16,884
Stockpiles and ore on leach pads	8		208,483		215,809
Property, plant and equipment, net	10		1,364,610		1,455,329
Intangible assets, net			30,852		36,380
Deferred income tax asset	14		-		483,479
Total non-current assets			1,619,748		2,207,881
Total assets			2,965,430		3,483,169

Current liabilities
Trade and other payables	11		78,250		138,819
Income tax payable			12,346		35,436
Current provisions	12		41,961		55,585
Total current liabilities			132,557		229,840

Non-current liabilities
Non-current provisions	12		604,048		573,552
Total liabilities			736,605		803,392

Partners’ equity, net
Partners’ contributions	13		398,216		398,216
Additional paid-in-capital			226		226
Retained earnings			1,830,383		2,281,335
Total equity			2,228,825		2,679,777
Total liabilities and partners’ equity, net			2,965,430		3,483,169

The accompanying notes are an integral part of these consolidated financial statements.

~~MINERA YANACOCHA~~

F-103

Minera Yanacocha S.R.L. and Subsidiary

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~Consolidated statements of comprehensive income

~~(dollars~~For the years ended December 31, 2015, 2014 and 2013

	Note	2015			2014			2013
		US$(000)			US$(000)			US$(000)

Operating income
Revenue from sales	15		1,031,174			1,165,299			1,406,825
Other operating income			10,625			30,300			37,207
Total gross income			1,041,799			1,195,599			1,444,032

Costs applicable to sales	16		(751,736	)		(920,300	)		(991,264	)
Other operating costs			(2,524	)		(22,422	)		(28,672	)
Total operating costs			(754,260	)		(942,722	)		(1,019,936	)
Gross profit			287,539			252,877			424,096

Operating expenses
Operating expenses, net	17		(82,846	)		(77,781	)		(77,534	)
Administrative expenses	18		(26,325	)		(38,262	)		(67,064	)
Selling expenses			(3,534	)		(4,458	)		(3,740	)
Impairment loss	10		-			(541,141	)		(1,038,548	)

Operating profit			174,834			(408,765	)		(762,790	)
Other income (expenses), net
Finance income			673			298			720
Finance costs	19		(22,734	)		(23,504	)		(18,745	)
Net gain (loss) from currency exchange difference			(251	)		1,142			2,065
Income (loss) before income tax			152,522			(430,829	)		(778,750	)
Income tax benefit (expense)	14(c)		(602,717	)		30,491			203,471

Loss for the year			(450,195	)		(400,338	)		(575,279	)

Comprehensive income (loss):
Loss for the year			(450,195	)		(400,338	)		(575,279	)
Other comprehensive income (loss) to be reclassified as profit or loss in subsequent periods:
Changes in the fair value of available-for-sale financial asset, net of tax effect	9		(757	)		65			(226	)

Total comprehensive loss for the year			(450,952	)		(400,273	)		(575,505	)

The accompanying notes are an integral part of these consolidated financial statements.

F-104

Minera Yanacocha S.R.L. and Subsidiary

Consolidated statements of changes in ~~thousands unless otherwise stated)~~equity, net

For the years ended December 31, 2015, 2014 and 2013

	Capital stock		Additional Paid-in-capital		Retained earnings			Total
	US$(000)		US$(000)		US$(000)			US$(000)

As of January 1, 2013		398,216		226		3,257,113			3,655,555
Loss for the year		-		-		(575,279	)		(575,279	)
Other comprehensive loss for the year		-		-		(226	)		(226	)
Total comprehensive loss		-		-		(575,505	)		(575,505	)

As of December 31, 2013		398,216		226		2,681,608			3,080,050
Loss for the year		-		-		(400,338	)		(400,338	)
Other comprehensive loss for the year		-		-		65			65
Total comprehensive loss		-		-		(400,273	)		(400,273	)

As of December 31,2014		398,216		226		2,281,335			2,679,777
Loss for the year		-		-		(450,195	)		(450,195	)
Other comprehensive loss for the year		-		-		(757	)		(757	)
Total comprehensive loss		-		-		(450,952	)		(450,952	)

As of December 31, 2015		398,216		226		1,830,383			2,228,825

The accompanying notes are an integral part of these consolidated financial statements.

F-105

Minera Yanacocha S.R.L. and Subsidiary

Consolidated statement of cash flows

For the years ended December 31, 2015, 2014 and 2013

	2015			2014			2013
	US$(000)			US$(000)			US$(000)
Cash flow from operating activities
Loss for the year		(450,195	)		(400,338	)		(575,279	)
Adjustments to reconcile profit after income tax to net cash flows from operating activities:
Impairment loss on assets		-			541,141			1,038,548
Depreciation and amortization		223,142			360,334			349,760
Deferred income tax		483,804			(168,761	)		(430,624	)
Unwinding of discount of the provision for reclamation		22,075			22,914			18,113
Write-off of fixed assets		2,411			3,520			584
Loss (gain) for fixed asset sales		508			(1,226	)		(22,526	)
Write-down of ore on leach pads to realizable value		64,497			95,859			146,051
Allowance for obsolescence of materials and supplies		1,049			(736	)		2,271
Working capital adjustments:
Net (increase) decrease in operating assets:
Trade and other receivables		41,842			28,382			20,913
Value added tax credit		3,701			36,606			23,762
Inventories and Stockpiles and ore on leach pads		(17,180	)		(64,855	)		(121,868	)
Prepaid expenses		160			1,650			117
Available for sale financial assets		1,081			(93	)		336
Net (increase) decrease in operating liabilities:
Trade and other payables		(60,569	)		6,910			(31,189	)
Income tax payable		(23,090	)		(29,264	)		13,862
Provisions		(7,779	)		(46,435	)		(112,172	)
Reclamation liabilities paid		(11,007	)		(10,419	)		(4,387	)
Net cash and cash equivalents provided by operating activities		274,450			375,189			316,272
Cash flow from investing activities
Purchase of property, plant and equipment		(118,429	)		(216,181	)		(393,130	)
Proceeds from sale of property, plant and equipment		1,116			40,651			45,772
Net cash and cash equivalents used in investing activities		(117,313	)		(175,530	)		(347,358	)
Net increase (decrease) in cash and cash equivalents		157,137			199,659			(31,086	)
Cash and cash equivalents at beginning of year		786,624			586,965			618,051
Cash and cash equivalents at end of year		943,761			786,624			586,965

Transactions with no effects in cash flows:
Addition of asset retirement and mine closure		10,434			64,520			44,604

The accompanying notes are an integral part of these consolidated financial statements.

F-106

Minera Yanacocha S.R.L. and Subsidiary

Notes to the consolidated financial statements

For the years 2015, 2014 and 2013

~~BUSINESS ACTIVITIES~~Identification and business activities of the Company

(a)

Identification -

Minera Yanacocha S.R.L. ~~(the “Company”), formerly Minera Yanacocha S.A.~~hereinafter “the Company”, was incorporated in Peru on January 14, 1992 and commenced operations in 1993. The Company is engaged in the production of gold and exploration and development of gold and copper under the mining concessions it owns or that are owned by S.M.R.L. Chaupiloma Dos de Cajamarca ~~(“Chaupiloma”~~("Chaupiloma").

The Company is 51.35% owned ~~51.35%~~ by Newmont Second Capital Corporation, a 100% indirectly owned subsidiary of Newmont Mining Corporation ~~(“Newmont”)~~("Newmont", the ultimate Parent company), 43.65% owned by Compañíaia Minera Condesa S.A., which is 100% owned by Compañíaia de Minas Buenaventura S.A.A. (“Buenaventura”) and 5% owned by the International Finance Corporation.

The majority Partners of the Company (or their affiliates) also own the majority interest in Chaupiloma. In accordance with a mining lease, amended and effective on January 1, 1994, the Company pays Chaupiloma a 3% royalty based on quarterly production ~~sold~~soId at current market prices, after deducting refinery and transportation costs. The royalty agreement ~~expired~~expires in ~~2012, however this was extended until~~ 2032.

(b)

Business activities-

The ~~Company is~~Company's operations are located innear Cajamarca, province of Peru and currently ~~has active~~include the following open pit ~~mines as~~mines: Chaquicocha, Maqui Maqui, Cerro Yanacocha, La Quinua ~~(which includes~~Complex (La Quinua, El Tapado, El Tapado Oeste), ~~Chaquicocha, Maqui Maqui, Carachugo~~Cerro Negro Este, Wester Oxide pits (La Quinua Sur and Cerro ~~Negro.~~Negro Oeste), Eastern Oxide pits (Quecher Norte and Marleny) and Carachugo Alto. The Company has four leach pads, three processing facilities, and one mill. Gold-bearing ores are transported to one of four leach pads for gold recovery using conventional heap-leaching or milling, followed by Merrill - Crowe zinc precipitation and smelting where a final doré product is poured. The doré is then shipped offsite for refining and is sold on the worldwide gold markets.

Gold mining requires the use of specialized facilities and technology. The Company relies heavily on such facilities and technology to maintain production levels. Also, the cash ~~flow~~flows and profitability of the ~~Company’s~~Company's operations are significantly affected by the market price of gold. Gold prices can fluctuate widely and are affected by numerous factors beyond the ~~Company’s~~Company's control. During ~~2012, 2011~~2015, 2014 and ~~2010,~~2013, the Company produced ~~1.35~~0.92 million, ~~1.29~~0.97 million and ~~1.46~~1.02 million ounces of gold, respectively.

Conga project

The Conga ~~project~~Project consists of two gold-copper porphyry deposits located northeast of the Yanacocha operating area in the provinces of Celendin, Cajamarca and Hualgayoc. ~~The project has proven~~There is no exploration and/or development of new reserves as development of the project's development and ~~probable reserves of 12.6 million ounces (unaudited) of contained gold and 3.3 billion pounds (unaudited) of contained copper at December 31, 2012.~~reserve balances reported for Conga in 2014 were reclassified to mineralized material in 2015.

~~F-115~~

F-107

~~MINERA YANACOCHA S.R.L.~~Notes to the consolidated financial statements (continued)

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~

~~Construction~~As a result of local political and community protests, construction and development activities ~~on our~~at the Conga project were largely suspended onin November ~~30, 2011 at the request of Peru’s central government following increasing protests in Cajamarca by anti-mining activists led by the regional president. At the request~~2011. The results of the Peruvian ~~central government,~~Central Government’s initiated Environmental Impact Assessment (“EIA”) independent review were reported on April 20, 2012. The review indicated the ~~environmental impact~~project’s EIA met Peruvian and International Standards. The review made recommendations to provide additional water capacity and social funds, which Yanacocha has largely accepted. Yanacocha announced the decision to move the project forward on a “water-first” approach on June 22, 2012. In the first half of 2014, a Conga Restart Study was completed to identify and test alternatives to advancing development of the project. Following this assessment, ~~prepared in connection~~a new plan was developed to reduce spending to focus on only the most critical work – protecting people and assets, engaging with communities, and maintaining existing project infrastructure – while maintaining optionality. Newmont will not proceed with the project, which was previously approved by the central government in October 2010, was reviewed by independent experts, in an effort to resolve allegations around the environmental viability of Conga. This review concluded that the environmental impact assessment complied with international standards and provided some recommendations to improve water management. Yanacocha is currently focusing on the construction of water reservoirs prior to the development of other project facilities. Management is committed to thefull development of Conga ~~however, development~~without social acceptance, solid project economics and potentially another partner to help defray costs and risk; it is currently difficult to predict when or whether such events may occur. Under the current social and political environment, the Company does not anticipate being able to develop Conga for the foreseeable future. The continued delay and evaluation of ~~Conga is contingent upon generating acceptable project returns and getting local community and government support.~~

~~In the second quarter of 2011, Presidential and Congressional elections resulted~~other alternatives may result in a ~~change in government in Peru. The new administration supported mining as a driver for continued growth and future development~~potential accounting impairment or further reclassification of Peru in 2012. However, we are unable to predict whether the Central government will continue to take similar positions in the future. The regional government actively opposed the Conga project in 2012 and continues to reject the viability of its development. We are unable to predict the positions that will be taken in the future and whether such positions or changes in law will affect Yanacocha or Conga. Such changes may include increased labor regulations, environmental and other regulatory requirements, and additional taxes and royalties, as well as future protests, community demands and road blockages. For example, during the third quarter of 2011, the new government enacted four new tax laws. The Company cannot predict future positions of either the Central or regional government on foreign investment, mining concessions, land tenure or other regulation. Any change in government positions or laws on these issues could adversely affect the assets and operations of Yanacocha or Conga, which could have a material adverse effect on our results of operations and financial position. Additionally, any inability to continue to develop the Conga project or operate at Yanacocha could have an adverse impact on our growth if we are not able to replace its expected production.

Total proven and probable reserves (unaudited) contained in active open pits, other pits to be developed, stockpiles, ore in process on leach pads and the Conga project are approximately 18.5 million ounces of contained gold, 3.3 billion pounds of contained copper and 37.1 million ounces of silver at December 31, 2012.

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~Mineralized Material.

2.(c)

~~SIGNIFICANT ACCOUNTING POLICIES~~Approval of consolidated financial statements -

~~Principles of Consolidation~~

The Consolidated Financial Statements include the accounts of Minera Yanacocha S.R.L and the San José Reservoir Trust (“Trust”). In November 2008, the Company funded the Trust to ensure continuous operation of the San José Reservoir after 2018. The Company transferred $13,000 to the Trust in 2008. No withdrawals are allowed until 2018 and the Company is committed to a $23,000 fundconsolidated financial statements as of ~~such date. This Trust is irrevocable~~December 31, 2015 were approved by the Company’s Management on February 25, 2016 and, ~~is a separate legal entity. The grantor is the Company, the trustee is the FiduPerú S.A. Sociedad Fiduciaria and the beneficiary is the Company; therefore, the Company consolidates the Trust~~ in its ~~Consolidated Financial Statements.~~

~~Use of Estimates~~opinion, will be approved without changes at the Partners’ Meeting to be held within the terms established by Law.

The ~~Company’s Consolidated Financial Statements~~consolidated financial statements as of December 31, 2014 and 2013 were issued with the approval of the Partners’ Meeting held on March 26, 2015.

Basis for preparation, consolidation and accounting policies

2.1.

Basis of preparation -

The consolidated financial statements of the Company have been prepared in accordance with ~~accounting principles generally accepted in~~International Financial Reporting Standards (“IFRS”) issued by the ~~United States of America.~~International Accounting Standard Board (“ASB”) and interpretations issued by the IFRS Interpretations Committee (“IFRIC”). The preparation of the Company’s Consolidated Financial Statements requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and the related disclosure of contingent assets and liabilities at the date of the Consolidated Financial Statements and the reported amounts of revenues and expenses during the reporting period. The more significant areas requiring the use of management estimates and assumptions relate to mineral reserves that are the basis for future cash flow estimates utilized in impairment calculations and units-of-production amortization calculations; environmental, reclamation and closure obligations; estimates of recoverable gold and other minerals in stockpile and leach pad inventories; write-downs of inventory, ore on leach pads and stockpiles to net realizable value; employee benefit liabilities; valuation allowances for deferred tax assets; workers’ profit participation; reserves for contingencies and litigation; and the fair value and accounting treatment ofconsolidated financial ~~instruments. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable~~statements have been prepared under the ~~circumstances. Accordingly, actual results may differ significantly from these estimates under different assumptions or conditions.~~

~~Currency~~historical cost basis, except for available-for-sale financial assets which are measured at their fair value.

The ~~Consolidated Financial Statements~~consolidated financial statements are presented in U.S. dollars and all values are rounded to the nearest thousands, except when otherwise indicated.

The preparation of consolidated financial statements requires that Management use judgments, estimates and assumptions, as detailed in Note 3.

These consolidated financial statements provide comparative information in respect of prior periods.

F-108

Notes to the consolidated financial statements (continued)

2.2.

Basis of consolidation -

The consolidated financial statements comprise the financial statements of the Company and its subsidiary (San Jose Reservoir Trust, a separate legal entity created to ensure the continuity of the Company’s operations in the San Jose Reservoir after 2018).

Control is achieved when the Company is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Specifically, the Company controls an investee if, and only if, the Company has:

Power over the investee (i.e., existing rights that give it the current ability to direct the relevant activities of the investee);

Exposure, or rights, to variable returns from its involvement with the investee;

The ability to use its power over the investee to affect its returns.

Generally, there is a presumption that a majority of voting rights result in control. To support this presumption and when the Company has less than a majority of the voting or similar rights of an investee, the Company considers all relevant facts and circumstances in assessing whether it has power over an investee, including:

The contractual arrangement with the other vote holders of the investee.

Rights arising from other contractual arrangements.

The Company’s voting rights and potential voting rights or a combination of rights.

The Company re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the Company loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated financial statements from the date the Company gains control until the date the Company ceases to control the subsidiary.

When necessary, adjustments are made to the financial statements of the subsidiary to bring its accounting policies into line with the Company’s accounting policies.

All intra-group assets and liabilities, equity, income, expenses and cash flows are eliminated in full on consolidation.

A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction.

F-109

Notes to the consolidated financial statements (continued)

2.3.

Changes in accounting policies and disclosures -

Certain standards and amendments are effective for annual periods beginning on or after January 1, 2015. However, they do not impact the annual consolidated financial statements of the Company and, hence, have not been disclosed. The Company has not early adopted any standard, interpretation or amendment that has been issued but is not yet effective.

2.4.

Summary of significant accounting policies and practices -

(a)

Foreign currencies -

The consolidated financial statements are stated in U.S. dollars, the ~~Company’s~~Company's functional ~~currency, as most of its transactions are traded, collected and paid in such~~ currency. Transactions in other currencies are recorded in U.S. dollars based on exchange rates prevailing at the time of such transactions. Monetary assets and liabilities denominated in other currencies are translated into the U.S. dollar at exchange rates prevailing at the ~~balance sheet~~statements of financial position dates, and any resulting gains or losses are reflected in current earnings.

(b)

Financial instruments - Initial recognition and subsequent measurement -

~~Cash~~A financial instrument is any contract that gives rise to a financial asset of one entity and ~~Cash Equivalents~~a financial liability or equity instrument of another entity.

(i)

Financial assets -

Initial recognition and measurement-

Financial assets are classified, at initial recognition, as financial assets at fair value through profit or loss, loans and receivables, held-to-maturity investments, available-for-sale financial assets, or derivatives designated as hedging instruments in an effective hedge, as appropriate. All financial assets are recognized initially at fair value plus, in the case of financial assets not recorded at fair value through profit or loss, transaction costs that are attributable to the acquisition of the financial asset.

Subsequent measurement -

For purposes of subsequent measurement, financial assets are classified in four categories:

Financial assets at fair value through profit or loss.

Loans and receivables.

Held-to-maturity investments.

Available-for-sale financial investments.

Financial assets at fair value through profit or loss-

Financial assets at fair value through profit or loss include financial assets held for trading and financial assets designated upon initial recognition at fair value through profit or loss. Financial assets are classified as held for trading if they are acquired for the purpose of selling or repurchasing in the near term. Derivatives, including separated embedded derivatives, are also classified as held for trading unless they are designated as effective hedging instruments as defined by IAS 39.

F-110

Notes to the consolidated financial statements(continued)

Financial assets at fair value through profit or loss are carried in the consolidated statements of financial position at fair value with net changes in fair value presented as finance costs (negative changes) or finance revenue (positive changes) in the consolidated statements of comprehensive income.

Derivatives embedded in host contracts are accounted for as separate derivatives and recorded at fair value if their economic characteristics and risks are not closely related to those of the host contracts and the host contracts are not held for trading or designated at fair value though profit or loss. These embedded derivatives are measured at fair value, with changes in fair value recognized in profit or loss.

Loans and receivables-

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. After initial measurement, such financial assets are subsequently measured at amortized cost using the effective interest rate method, less impairment. The losses arising from impairment are recognized in the consolidated statements of profit or loss.

This category generally applies to trade and other receivables, net.

Held-to-maturity investments -

Non-derivative financial assets with fixed or determinable payments and fixed maturities are classified as held to maturity when the Company has the positive intention and ability to hold them to maturity. The Company did not have any held-to-maturity investments as of December 31, 2015 and 2014.

Available-for-sale financial assets -

The available-for-sale financial assets include equity investments and debt securities. Equity investments classified as available-for-sale are those that are neither classified as held for trading nor designated at fair value through profit or loss. Debt securities in this category are those that are intended to be held for an indefinite period of time and may be sold in response to needs for liquidity, or in response to changes in the market conditions (Note 9).

Derecognition-

A financial asset (or, where applicable a part of a financial asset or part of a group of similar financial assets) is primarily derecognized when:

The rights to receive cash flows from the asset have expired.

The Company has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a pass-through arrangement; and either (a) the Company has transferred substantially all the risks and rewards of the asset or, (b) the Company has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.

When the Company has transferred its rights to receive cash flows from an asset, or has entered into a pass-through arrangement, it evaluates if and to what extent, it has retained the risk and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Company continues to recognize the transferred asset to the extent of the Company’s continuing involvement. In that case, the Company also recognizes an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the Company has retained.

F-111

Notes to the consolidated financial statements (continued)

Impairment of financial assets -

The Company assesses, at each reporting date, whether there is objective evidence that a financial asset or group of financial assets is impaired. An impairment exists if one or more events that has occurred since the initial recognition of the asset (an incurred "loss event") has an impact on the estimated future cash flows of the financial asset or the group of financial assets that can be reliably estimated.

Evidence of impairment may include indications that the debtors or a group of debtors is experiencing significant financial difficulty, default or delinquency in interest or principal payments, the probability that they will enter bankruptcy or other financial reorganization and observable data indicating that there is a measurable decrease in the estimated future cash flows, such as changes in economic conditions that correlate with defaults.

For financial assets carried at amortized cost, the Company first assesses whether impairment exists for financial assets that are individually significant, or collectively for financial assets that are individually insignificant.

The amount of any impairment loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows. The present value of the estimated future cash flows is discounted at the financial asset’s original effective interest rate.

The carrying amount of the asset is reduced through the use of an allowance account and the loss is recognized in the consolidated statements of comprehensive income. Interest income (recorded as revenue in the statements of comprehensive income) continues to be accrued on the reduced carrying amount and is accrued using the interest rate used to discount the future cash flows for the purpose of measuring the impairment loss. Loans, together with the associated allowance, are written off when there is no realistic prospect of a future recovery and all collateral has been realized or has been transferred to the Company. If, in a subsequent year, the amount of the estimated impairment loss increases or decreases due to an event occurring after the impairment was recognized, the previously recognized impairment loss is increased or reduced by adjusting the allowance account. If a write-off is later recovered, the recovery is credited to finance costs in the consolidated statements of comprehensive income.

(ii)

Financial liabilities –

Initial recognition and measurement -

All financial liabilities are recognized initially at fair value and, in the case of interest-bearing loans and borrowings and payables, net of directly attributable transaction costs.

F-112

Notes to the consolidated financial statements (continued)

The Company’s financial liabilities include trade and other payables.

Subsequent measurement -

The measurement of financial liabilities depends on their classification. Trade and other payables are subsequently measured at amortized cost.

Derecognition-

A financial liability is derecognized when the obligation under the liability is discharged, cancelled or expires.

When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognized in the consolidated statements of comprehensive income.

(iii)

Offsetting of financial instruments -

(c)

Cash and cash equivalents -

Cash and cash equivalents ~~consist of all~~include cash ~~balances~~in hand, deposits held at call with banks and other short-term highly liquid investments with an original ~~maturity~~maturities of three months or less. ~~Because of the short maturity of these balances, the carrying amounts approximate their fair value.~~ Restricted cash is excluded from cash and cash equivalents and is included in other current assets or long-term assets depending on restrictions.

~~MINERA YANACOCHA S.R.L.~~

F-113

Notes to the consolidated financial statements (continued)

(d)

Stockpiles, ore on leach pads and inventories -

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~

~~Investments~~

Management determines the appropriate classification of its investments in equity securities at the time of purchase and reevaluates such determinations at each reporting date. The Company accounts for its marketable security investments as available for sale securities in accordance with~~FASB Accounting Standards Codification (“~~ASC”) guidance on accounting for certain investments in debt and equity securities. The Company periodically evaluates whether declines in fair values of its investments below the Company’s carrying value are other - than - temporary in accordance with ASC guidance. The Company’s policy is to generally treat a decline in the investment’s quoted market value that has lasted continuously for more than six months as other - than - temporary decline in value. The Company also monitors its investments for events or changes in circumstances that have occurred that may have a significant adverse effect on the fair value of the investment and evaluates qualitative and quantitative factors regarding the severity and duration of the unrealized loss and the Company’s ability to hold the investment until a forecasted recovery occurs to determine if the decline in value of an investment is other - than - temporary. Declines in fair value below the Company’s carrying value deemed to be other - than - temporary are charged to earnings.

~~Stockpiles, Ore on Leach Pads and Inventories~~

~~As described below, costs~~Costs that are incurred in or benefit the productive process are accumulated as stockpiles, ore on leach pads and inventories. Stockpiles, ore on leach pads and inventories are carried at the lower of average cost or net realizable value. Net realizable value represents the estimated future sales price of the product based on current and ~~long - term~~long-term metals prices, less the estimated costs to complete production and bring the product to sale. ~~Write - downs~~Write-downs of stockpiles, ore on leach pads and inventories to net realizable value are reported as a component of~~Costs~~ costs applicable to ~~sales~~.sales. The current portion of stockpiles, ore on leach pads and inventories is determined based on the expected amounts to be processed within the next twelve months. Stockpiles, ore on leach pads and inventories not expected to be processed within the next twelve months are classified as ~~long - term.~~non-current. The major classifications are as follows:

(i)

Stockpiles -

Stockpiles represent ore that has been extracted from the mine and is available for further processing. Stockpiles are measured by estimating the number of tons added and removed from the stockpile, the number of contained ounces (based on assay data) and the estimated metallurgical recovery rates (based on the expected processing method). Stockpile ore tonnages are verified by periodic surveys. Costs are allocated to stockpiles based on relative values of material stockpiled and processed using current mining costs incurred up to the point of stockpiling the ore, including applicable overhead and depreciation and amortization relating to mining operations, and removed at each stockpile's average cost per recoverable unit as material is processed.

(ii)

Ore on leach pads -

The recovery of gold from certain gold oxide ores is achieved through the heap leaching process. Under this method, oxide ore is placed on leach pads where it is treated with a chemical solution, which dissolves the gold contained in the ore. The resulting ~~gold - bearing~~gold-bearing solution is ~~further~~later processed in a plant where the gold is recovered. Costs are added to ore on leach pads based on current mining costs, including applicable overhead and depreciation and amortization relating to mining operations. Costs are removed from ore on leach pads as ounces are recovered based on the average cost per estimated recoverable ounce of gold on the leach pad.

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~

The estimates of recoverable gold on the leach pads are calculated from the quantities of ore placed on the pads (measured tons added to the leach pads), the grade of ore placed on the leach pads (based on assay data) and a recovery percentage (based on ore type). In general, the leach pads recover ~~approximately~~between 50% toand 95% of the ultimate recoverable ounces in the first year of leaching, declining each year thereafter until the leaching process is complete.

F-114

Notes to the consolidated financial statements (continued)

Although the quantities of recoverable gold placed on the leach pads are reconciled by comparing the grades of ore placed on the pads to the quantities of gold actually recovered (metallurgical balancing), the nature of the leaching process inherently limits the ability to precisely monitor inventory levels. As a result, the metallurgical balancing process is constantly monitored and estimates are refined based on actual results over time. Historically, the ~~Company’s~~Company's operating results have not been materially impacted by variations between the estimated and actual recoverable quantities of gold on its leach pads. Variations between actual and estimated quantities resulting from changes in assumptions and estimates that do not result in ~~write - downs~~write-downs to net realizable value are accounted for on a prospective basis.

(iii)

In-processinventory -

In-process ~~Inventory~~

~~In - process~~ inventories represent materials that are currently in the process of being converted to a saleable product. ~~The conversion~~Conversion processes vary depending on the nature of the ore and the specific processing facility, and include mill in-circuit and leach in-circuit. ~~In - process~~In-process material is measured based on assays of the material fed into the process and the projected recoveries of the respective plants. ~~In - process~~In-process inventories are valued at the average cost of the material fed into the process attributable to the source material coming from the mines, stockpiles and/or leach pads plus the ~~in -~~in- process conversion costs, including applicable amortization relating to the process facilities incurred to that point in the process.

~~Precious Metals Inventory~~

(iv)

Precious metals inventory -

Precious metals include gold ~~dore~~Doré and/or gold bullion. Precious metals that result from the ~~Company’s~~Company's mining, processing ~~and refining~~ activities are valued at the average cost of the respective ~~in - process~~in-process inventories incurred prior to the refining process, plus applicable refining costs.

~~Concentrate Inventory~~

Concentrate inventories represent silver, gold and copper concentrate available for shipment. The Company values concentrate inventory at the average cost, including an allocable portion of support costs and amortization. Costs are added and removed to the concentrate inventory based on tons of concentrate and are valued at the lower of average cost or net realizable value.

~~F-119~~

(v)

Materials and supplies -

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~

~~Materials and Supplies~~

Materials and supplies are valued at the lower of average cost or ~~net realizable~~replacement value. Cost includes applicable taxes and freight.

(e)

Property, plant and equipment -

~~Property, Plant~~The cost of an element of property, plant and ~~Mine Development~~equipment comprises the following: the acquisition price or manufacturing cost, including non-reimbursable customs and taxes and any cost necessary to place the asset in operating condition, as anticipated by Management; the initial estimate of the rehabilitation obligation and; in the case of qualified assets, the financing costs.

The purchase price or construction cost corresponds to the total amount paid and fair value of any other consideration provided to acquire the asset. Subsequent costs attributable to property, plant and equipment are capitalized only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably, otherwise the cost is charged to production or expense.

Maintenance and repair expenses are charged to the production cost or expense, as necessary, in the period when incurred.

F-115

Notes to the consolidated financial statements (continued)

Expenses incurred to replace a component of an item or element of property, plant and equipment are capitalized separately, writing-off the carrying amount of the component being replaced. In the event the component replaced has not been considered as a separate component of the asset item, the replacement value of the new component is used to estimate the carrying amount of the assets being replaced.

Assets in the construction stage are capitalized as separate components. At their completion, the cost is transferred to the appropriate category. Work in progress is not depreciated.

~~Facilities~~Depreciation

Land is not depreciated. Other than land, depreciation of property, plant and ~~Equipment~~equipment is calculated using the straight-line method to allocate their cost less their residual value over their estimated useful lives and in the case of assets assigned to the production process of Yanacocha, under the lower of that determined under the units of production method or the useful life of the mine, as follows:

	Years

Land improvements	25 years
Buildings	Between 5 and 25 years
Plant and equipment	Between 3 and 15 years
Vehicles	Between 3 and 5 years
Furniture and fittings	Between 3 and 10 years
Other equipment	Between 3 and 10 years
Computer equipment	Between 3 and 8 years
Assets retirement cost	Useful life of the mine and/or process facilities

The assets' useful lives and residual values are reviewed, and adjusted if appropriate, at each date of the consolidated statement of financial position. Any changes in these estimates are prospectively adjusted.

Disposal of assets

Property, plant and equipment items are written-off at the date they are sold or when no economic benefits are expected from their further use or sale. Gains and losses on disposals of assets are determined by comparing the proceeds with their carrying amounts. These gains or losses are included in the consolidated statements of comprehensive income.

F-116

Notes to the consolidated financial statements (continued)

(f)

Mineral Interests -

Mineral interests include acquired interests in production, development and exploration stage properties. The mineral interests are capitalized at their fair value at the acquisition date.

~~Expenditures for new facilities or equipment and expenditures that extend the useful lives of existing facilities or equipment are capitalized and recorded at cost.~~ The ~~facilities and equipment are amortized using the straight - line method at rates sufficient to amortize such costs over the estimated productive lives~~value of such ~~facilities. These estimated productive lives do not exceed~~assets is primarily driven by the ~~related estimated mine lives, which are based on~~nature and amount of mineralized material believed to be contained in such properties. Production stage mineral interests represent interests in operating properties that contain proven and probable reserves. Development stage mineral interests represent interests in properties under development that contain proven and probable reserves.

Exploration stage mineral interests represent interests in properties that are believed to potentially contain mineralized material consisting of (i) mineralized material such as inferred material within pits; mineralized material with insufficient drill spacing to qualify as proven and probable reserves; and mineralized material in close proximity to proven and probable reserves; (ii) around-mine exploration potential not immediately adjacent to existing reserves and mineralization, but located within the immediate mine area; (iii) other mine-related exploration potential that is not part of current mineralized material and is comprised mainly of material outside of the immediate mine area; (iv) greenfield exploration potential that is not associated with any other production, development or exploration stage property, as described above; or (v) any acquired right to explore or extract a potential mineral deposit.

~~Mine Development~~

Exploration costs are capitalized when reserves at the location are declared in the Reserves and Resource information published annually by Newmont in its form 10-K. At this point, exploration costs are capitalized as mine development or as a component of property, plant and equipment, as appropriate.

The Company's mineral rights generally are enforceable regardless of whether proven and probable reserves have been established. The Company has the ability and intent to renew mineral interests where the existing term is not sufficient to recover all identified and valued proven and probable reserves and/or undeveloped mineralized material.

Mineral interests are presented in the caption of property, plant and equipment.

(g)

Mine development -

Mine development costs include engineering and metallurgical studies, drilling and other related costs to delineate an ore body, and the removal of overburden to initially expose an ore body at open pit surface mines. Costs incurred before mineralization is classified as proven and probable reserves are expensed and classified asExploration orAdvanced projects, research and development expense. Capitalization of mine development project costs, that meet the definition of an asset, begins once mineralization is classified as proven and probable reserves.

F-117

Notes to the consolidated financial statements (continued)

Drilling and related costs are capitalized for an ore body where proven and probable reserves exist; and the activities are directed at obtaining additional information on the ore body or converting ~~non - reserve mineralization~~mineralized material to proven and probable reserves. ~~All~~AII other drilling and related costs are expensed as incurred. Drilling costs incurred during the production phase for operational ore control are allocated to inventory costs and then included as a component ofCosts applicable to ~~sales~~.sales.

The cost of removing overburden and waste materials to access the ore body at an ~~open pit~~open-pit mine prior to the production phase are referred to as ~~“pre - stripping costs”. Pre - stripping~~"pre-stripping costs." Pre-stripping costs are capitalized during the development of an ~~open pit~~open-pit mine. Where multiple open pits exist at a mining complex utilizing common processing facilities, ~~pre - stripping~~pre-stripping costs are capitalized at each pit. The removal and production of de minimis saleable materials may occur during development and are recorded asOther income,, net of incremental mining and processing costs.

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~

The production phase of an open pit mine commences when saleable minerals, beyond a de minimis amount, are produced. Stripping costs incurred during the production phase of a mine are variable production costs that are included as a component of inventory to be recognized in~~Costs applicable to sales~~ in the same period as the revenue from the sale of inventory. The Company’s definition of a mine and the mine’s production phase may differ from that of other companies in the mining industry resulting in incomparable allocations of stripping costs to deferred mine development and production costs. Other mining companies may expense pre - stripping costs associated with subsequent pits within a mining complex. Other mining companies may capitalize stripping costs incurred in connection with the production phase. See (h) below.

Mine development costs are amortized using the ~~units - of~~units-of production ~~(“UOP”~~("UOP") method based on estimated recoverable ounces in proven and probable reserves. To the extent that these costs benefit an entire ore body, they are amortized over the estimated life of the ore body. Costs incurred to access specific ore blocks or areas that only provide benefit over the life of that area are amortized over the estimated life of that specific ore block or area.

~~Mineral Interests~~Mine development costs are presented in the caption of Property, plant and equipment, net.

(h)

Stripping activity asset -

~~Mineral interests include acquired interests in~~The Company accounts for stripping costs incurred during the production ~~development and exploration stage properties. The mineral interests are capitalized at their fair value at the acquisition date, either as an individual asset purchase or as part~~phase of a ~~business combination.~~surface mining in accordance with IFRIC 20 "Stripping costs in the production phase of as surface mine" whereby a stripping asset is recognized if, and only if, all of the following are met:

It is probable that the future economic benefit (improved access to the ore body) associated with the stripping activity will flow to the entity;

The entity can identify the component of the ore body for which access has been improved; and

The costs relating to the stripping activity associated with that component can be measured reliably.

The value of such assets is primarily driven by the nature and amount of mineralized material believed to be contained in such properties. Production stage mineral interests represent interests in operating properties that contain proven and probable reserves. Development stage mineral interests represent interests in properties under development that contain proven and probable reserves. Exploration stage mineral interests represent interests in properties that are believed to potentially contain mineralized material consisting of (i) mineralized material such as inferred material within pits; measured, indicated and inferred material with insufficient drill spacing to qualify as proven and probable reserves; and inferred material in close proximity to proven and probable reserves; (ii) around - mine exploration potential such as inferred material not immediately adjacent to existing reserves and mineralization, but located within the immediate mine area; (iii) other mine - related exploration potential that is not part of measured, indicated or inferred material and is comprised mainly of material outsideprimary components of the ~~immediate mine area; (iv) greenfields exploration potential that is not~~ore body on a pit by pit basis as well as within major pits are identified. Based on these components, stripping activities are analyzed and costs are assigned based on whether they pertained to current inventory production or improved access to future ore bodies (or components of an ore body).

Based on this analysis, the Company allocated the costs associated with ~~any other~~improved access as a production ~~development or exploration stage property, as described above; or (v) any acquired right~~stripping asset. This allocation is based on the volume of waste and ore extracted in the period compared to ~~explore or extract a potential mineral deposit. The Company’s mineral rights generally are enforceable regardless~~expected volume life-of-mine per component of whether proven and probable reserves have been established. The Company has the ability and intent to renew mineral interests where the existing term is not sufficient to recover all identified and valued proven and probable reserves and/or undeveloped mineralized material.

~~MINERA YANACOCHA S.R.L.~~ore body.

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~Costs allocated to the production stripping activity asset are subsequently depreciated. Depreciation of the production stripping asset was calculated on a systematic basis ("waste-to-ore tons ratio") method over the expected useful life of the identified component of the ore body that becomes more accessible as a result of the stripping costs. This depreciation is a production cost.

F-118

~~Asset Impairment~~

Notes to the consolidated financial statements (continued)

(i)

Impairment of non-financial assets -

The ~~Company reviews and evaluates its long-lived~~carrying amounts of non-financial assets are reviewed for impairment ~~when~~whenever events or changes in circumstances indicate ~~that~~ the ~~related~~ carrying ~~amounts~~value may not be recoverable. AnIf there are indicators of impairment, a review is ~~considered~~undertaken to ~~exist if~~determine whether the ~~total estimated future~~carrying values are in excess of the recoverable amount. The recoverable amount is determined as the higher of an asset's fair value, less costs of disposal, and its value in use. Such review is undertaken on an asset by asset basis, except where such assets do not generate cash flows ~~on an undiscounted basis are less than~~independently from other assets, in which case the ~~carrying amount of~~review is undertaken at the ~~assets. An impairment loss is measured~~cash generating unit level. The Company identified two separate cash generating units according to its segments; Yanacocha and ~~recorded based on discounted estimated future cash flows.~~ Conga.

Future cash flows are estimated based on quantities of recoverable minerals, expected gold and other commodity prices (considering current and historical prices, trends and related factors), production levels, operating costs, capital requirements and reclamation costs, all based on life-of-mine ~~plans. Existing proven~~plans and ~~probable reserves and value beyond proven and probable reserves, including mineralization that is not part of~~ the ~~measured, indicated or inferred resource base, are included when determining~~appropriate discount rate. These estimates, used in the fair value of mine site reporting units at acquisition and, subsequently, in determining whether the assets are impaired. The term “recoverable minerals” refers to the estimated amount of gold or other commodities that will be obtained after taking into account losses during ore processing and treatment. Estimates of recoverable minerals from such exploration stage mineral interests are risk adjusted based on management’s relative confidence in such materials. In estimating future cash flows, assets are grouped at the lowest level for which there are identifiable cash flows that are largely independent of future cash flows from other asset groups. The Company’s estimatesdetermination of future cash flows, are based on numerous assumptions and it is possible that actual future cash flows will be significantly different than the estimates, as actual future quantities of recoverable minerals, gold and other commodity prices, production levels, ~~and~~ costs and capital and interest rates are each subject to significant risks and uncertainties.

~~Revenue Recognition~~If the carrying amount of an asset exceeds its recoverable amount, an impairment loss is recorded in the statement of comprehensive income to reflect the asset at the lower amount. In assessing the recoverable amount for assets, the relevant future cash flows expected to arise from the fair value less costs of disposal have been discounted to their present value.

~~Revenue~~An impairment loss is ~~recognized, net~~reversed in the statement of ~~treatment and refining charges, from~~comprehensive income if there is a ~~sale when persuasive evidence of an arrangement exists,~~change in estimate used to determine recoverable amount since the price is determinable, the product has been delivered, the title has been transferred to the customer and collection of the sales price is reasonably assured. Revenues from silver and copper sales are credited to C~~osts applicable to sales~~ ~~as a by-product credit.~~

~~Income and Mining Taxes and Profit Sharing~~prior impairment loss was recognized.

The carrying amount of an asset is increased to the recoverable amount but not beyond the carrying amount net of depreciation or amortization which would have arisen if the prior impairment loss had not been recognized. After such a reversal the depreciation charge is adjusted in future periods to allocate the asset's revised carrying amount, less any residual value, on a systematic basis over its remaining useful life.

(j)

Provisions -

General-

Provisions are recognized when the Company ~~accounts for income~~has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation, and ~~mining taxes and legally required profit sharing~~the amount has been reliably estimated. If the time value of money is significant, provisions are discounted using pre-tax rates, which reflect, when appropriate, the ~~liability method, recognizing certain temporary differences between the financial reporting basis~~liabilities' specific risks. The reversal of the ~~Company’s liabilities~~discount due to the passage of time originates the increase of the obligation which is recognized with a charge to the statement of comprehensive income as a finance cost.

Provisions are reviewed periodically and are adjusted to reflect the best estimate available as of the date of the consolidation statement of financial position. The expenses related to other provisions are presented in the consolidated statement of comprehensive income.

Disclosure of contingent obligations is provided when their existence will only be confirmed by future events or their amount cannot be reliably measured. Contingent assets are not recognized and the related income tax basis for such liabilities and assets. This method generates a net deferred income tax liability and profit sharing liability or net deferred income tax asset and profit sharing asset forare disclosed only if it is probable that the Company ~~as measured by~~will generate future economic benefits.

F-119

Notes to the statutory tax and profit sharing rates in effect as enacted. The Company derives its deferred income tax charge or benefit and profit sharing charge or benefit by recording the change in the net deferred income tax liability and profit sharing liability or net deferred income tax asset and profit sharing asset balance for the year, based on Peruvian income and mining tax and profit sharing rates.consolidated financial statements(continued)

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~

The Company’s deferred income tax assets include certain future tax benefits. The Company records a valuation allowance against any portion of those deferred income tax assets when it believes, based on the weight of available evidence, it is more likely than not that some portion or all of the deferred income tax asset will not be realized.

Asset Retirement Obligation -

Reclamation ~~and Remediation Costs~~

~~Asset retirement~~ obligations are recognized when incurred and recorded as liabilities at ~~fair value.~~the best estimate of the expenditure required to settle the obligation. The liability is accreted over time through periodic charges to earnings. In addition, the asset retirement cost is capitalized as part of the ~~asset’s~~asset's carrying value and amortized over the life of the related asset. Reclamation costs are periodically adjusted to reflect changes in the estimated present value resulting from the passage of time and revisions to the estimates of either the timing or amount of the reclamation costs. The estimated ~~retirement~~reclamation obligation is based on when spending for an existing ~~environmental~~ disturbance is expected to occur. The Company reviews, on an annual basis, unless otherwise deemed necessary, the reclamation obligation at each mine ~~site in accordance with ASC guidance for reclamation obligations.~~site.

~~Future remediation costs~~

F-120

Notes to the consolidated financial statements (continued)

(k)

Revenue recognition -

Revenue from the sale of gold is recognized net of treatment and refining charges, when persuasive evidence of an arrangement exists, the price is determinable, the product has been delivered, risk and title has been transferred to the customer and collection of the sales price is reasonably assured.

Sales contracts for ~~inactive mines~~copper, silver and carbon incorporate provisional pricing at the date of delivery of the mineral ore. The final price is an average market price for a particular future period. Revenue from provisionally priced sales of copper, silver and carbon fine is recognized when risks and rewards of ownership are ~~accrued~~transferred to the customer, generally at the date of delivery, and revenue can be measured reliably. At this date, the amount of revenue to be recognized will be estimated based on ~~management’s best estimate~~the forward market price of the commodity being sold.

Revenues from silver and copper sales are credited to Costs applicable to sales as a by-product credit. Royalties paid based on revenue are charged to revenue.

(l)

Taxes -

Current income tax -

Current income tax assets and liabilities for the current and prior periods are measured at the ~~end of each period of the costs~~amount expected to be ~~incurred~~recovered from, or paid to, the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted at ~~a site. Such cost estimates include, where applicable, ongoing care, maintenance and monitoring costs. Changes~~the reporting date in ~~estimates at inactive mines are reflected in earnings in the period an estimate is revised.~~Peru.

~~Comprehensive Income~~

~~In addition~~Current income tax relating to~~Net income, Comprehensive income (loss)~~ includes all changes in equity during a period, such as cumulative unrecognized changes in fair value of marketable securities available - for - sale or other investments, except those resulting from investments by and distributions to owners.

~~Recently Adopted Accounting Pronouncements~~

~~Fair Value Accounting~~

In May 2011, ASC guidance was issued related to disclosures around fair value accounting. The updated guidance clarifies different components of fair value accounting including the application of the highest and best use and valuation premise concepts, measuring the fair value of an instrument classified in a reporting entity’s shareholders’ equity and disclosing quantitative information about the unobservable inputs used in fair value measurements that are categorized in Level 3 of the fair value hierarchy. The Company’s January 1, 2012 adoption of the updated guidance had no impact on the Company’s consolidated financial position, results of operations or cash flows. Refer to note 6 for further details regarding the Company’s assets and liabilities measured at fair value.

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~

~~Comprehensive Income~~

In June 2011, theASC guidance was issued related to comprehensive income. Under the updated guidance, an entity will have the option to present the total of comprehensive income either in a single continuous statement of comprehensive income or in two separate but consecutive statements. In addition, the update required certain disclosure requirements when reporting other comprehensive income. The update does not change the items ~~reported~~recognized directly in other comprehensive income or ~~when an item of~~equity is recognized in other comprehensive income ~~must be reclassified~~or equity and not in profit or loss. Management periodically evaluates positions taken in the tax returns with respect to ~~income. The Company adopted the new guidance~~situations where applicable tax regulations are subject to interpretation and its deferral and opted to present the total of comprehensive income in two separate but consecutive statements effective for its fiscal year beginning January 1, 2011. The early adoption had no impact on the Company’s consolidated financial position, results of operations or cash flows.establishes provisions where appropriate.

Deferred income tax -

The Company accounts for income and mining taxes using the liability method, recognizing certain temporary differences between the financial reporting basis of the Company's liabilities and assets and the related income tax basis for such liabilities and assets. This method generates a net deferred income tax liability or net deferred income tax asset for the Company, as measured by the statutory tax rates in effect as enacted. The Company derives its deferred income tax charge or benefit by recording the change in the net deferred income tax liability or net deferred income tax asset balance for the year, based on Peruvian income and mining tax laws. Royalty taxes are calculated based on operating profit, as such are shown as income tax.

F-121

Notes to the consolidated financial statements~~Recently Issued Accounting Pronouncements~~ (continued)

~~Reporting~~The Company's deferred income tax assets include certain future tax benefits. The Company determines valuation allowance to any portion of ~~Amounts reclassified out~~those deferred income tax assets when it believes, based on the weight of ~~Accumulated Other Comprehensive Income~~available evidence, it is more likely than not that some portion or all of the deferred income tax asset will not be realized (Note 14).

~~In February 2013, ASC guidance was issued related to items reclassified from~~~~Accumulated Other Comprehensive Income~~. The new standard requires either in a single note or parenthetically on the face of the financial statements:(i) the effect of significant amounts reclassified from each component of accumulated other comprehensiveDeferred income based on its source and (ii) the income statement line items affected by the reclassification. The update is effective for the Company’s fiscal year beginning January 1, 2013 with early adoption permitted. The Company does not expect the updated guidance to have a significant impact on the consolidated financial position, results of operations or cash flows.

~~Disclosures about Offsetting Assets and Liabilities~~

~~In November~~ ~~2011, ASC guidance was issued related to disclosures about offsetting~~tax assets and liabilities. The new standard requires disclosures to allow investors to better compare financial statements prepared under U.S. GAAP with financial statements prepared under IFRS. The update is effective for the Company’s fiscal year beginning January 1, 2013, and interim periods within those annual periods. Retrospective application is required.

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~

~~In January 2013, ASC guidance was issued to clarify that the disclosure requirements~~ are ~~limited to derivatives,~~ ~~repurchase agreements, and securities lending transactions~~recognized only to the extent that ~~they are (i) offset in~~it is probable that future taxable profit will be available against which the ~~financial statements or (ii) subject to an enforceable master netting arrangement or similar agreement.The Company does not expect the updated guidance to have an impact on the consolidated financial position, results of operations or cash flows.~~

~~OTHER EXPENSE, NET~~

Years Ended December 31,
2012 2011 2010
Regional administration $ 35,026 $ 23,341 $ 20,725
Community development and external affairs 30,078 17,341 16,002
World Gold Council dues 3,021 1,281 3,824
Negotiated payment - - 13,346
Employee Severance Program 40,943 - -
Other 3,927 (1,489 ) 4,105
$ 112,995 $ 40,474 $ 58,002

~~Negotiated Payment~~temporary differences can be utilized.

In December 2006, the Peruvian Government approved legislation regulating the conditions in which the negotiated payment was paid by Peruvian mining companies. The payment amounted to 3.75% of Peruvian net income afterDeferred income tax ~~(2.75% paid~~assets and liabilities are offset when there is a legally enforceable right to ~~a Local Mining Fund~~offset current tax assets against current tax liabilities and ~~1% paid~~when the deferred income tax assets and liabilities relate to ~~a Regional Mining Fund), payable for 2006 through 2010 if certain conditions were met. The funds are managed by an association designated~~income taxes levied by the ~~Company. Mining companies contributed these funds~~same taxation authority on either the same taxable entity or different taxable entities where there is an intention to ~~participate in~~settle the ~~government efforts to eradicate poverty in Peru in~~balances on a net basis.

Sales tax -

Expenses and assets are recognized net of the ~~current favorable economic environment.~~

~~Employee severance program~~

~~During 2012, Yanacocha conducted a restructuring program in order to align the Company’s organization with future business needs. In connection therewith, a group~~amount of employees signed mutual agreements to terminate their labor contracts in return for severance payments. This program was mainly executed during the month of September 2012 and no liabilities were outstanding at year-end.

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~sales tax, except:

4.(i)

~~OTHER INCOME, NET~~When the sales tax incurred on a purchase of assets or services is not recoverable from the taxation authority, in which case, the sales tax is recognized as part of the cost of acquisition of the asset or as part of the expense item, as applicable;

Years Ended December 31,
2012 2011 2010
Development projects, net $ 10,785 $ 24,959 $ 2,171
Gain (loss) on sale of assets (3,878 ) 1,557 (208 )
Interest income 1,019 1,323 2,196
Gain (loss) on sale of investments - 348 -
Foreign currency exchange gain (loss) (1,216 ) (745 ) 998
Other (130 ) 3,399 2,156
6,580 $ 30,841 $ 7,313

5.(ii)

~~INCOME AND MINING TAXES~~When receivables and payables are stated with the amount of sales tax included.

~~Tax Stabilization Agreements~~

The ~~Company has entered into~~net amount of sales tax recoverable from, or payable to, the ~~following tax stability agreements, each with a term~~taxation authority is included as part of ~~15 years:~~

~~Mine~~	~~Effective~~	~~Date of the Tax~~ ~~Agreement~~	~~Tax Regimes in~~ ~~Force~~

~~Maqui Maqui~~	~~January 1, 1997~~	~~September 12, 1994~~	~~May 6, 1994~~
~~Cerro Yanacocha~~	~~January 1, 2000~~	~~September 16, 1998~~	~~May 22, 1997~~
~~La Quinua~~	~~January 1, 2004~~	~~August 25, 2003~~	~~August 25, 2003~~

~~These agreements guarantee the Company’s use of the tax regimes shown~~receivables or payables in the ~~table above and permit maintenance~~consolidated statements of ~~its accounting records in U.S. dollars.~~

~~The Maqui - Maqui tax stability agreement expired on January 1, 2012 and is no longer in effect.~~

~~The Company determines the taxable income based on its understanding and that of its legal advisors, of applicable tax legislation. Taxable income differs from pre-tax income disclosed within these~~ financial ~~statements by those items that the applicable tax legislation deems to be non-taxable or non-deductible and by certain differences between U.S. and Peruvian generally accepted accounting principles.~~

~~For the years ended December 31, 2012, 2011 and 2010 the income tax rate was 30% except for the La Quinua mine for which a 29% income tax rate applied.~~

~~F-126~~

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~

~~Other Mining Taxes~~position.

a)(m)

~~Law N° 29788, Mining Royalties~~Fair value measurement -

The Company measures its financial instruments, such as, derivatives and embedded derivatives, at fair value as of the date of the consolidated statements of financial position.

~~During~~

Fair value is the ~~second quarter of 2004,~~price that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants at the ~~Peruvian Government enacted legislation to establish a sliding scale mining royalty of up to 3%~~measurement date. The fair value measurement is based on the ~~volume of mine production. The royalty is calculated on revenue from sales of product less certain refining and transportation expenses. While~~presumption that the ~~Peruvian royalty became effective during~~transaction to sell the ~~second quarter of 2004, it does not apply to those projects that had stabilization agreements prior to~~asset or transfer the adoption of the royalty law. The Company’s current production is derived from projects that were stabilized prior to the enactment of the royalty legislation as well as projects where the stabilization agreements have expired. In September 2011, the law was modified to comprise a ~~new mining tax payable to the Peruvian Government for extracting metallic and non - metallic mineral resources from its mining concessions.~~

The new mining royalty is payable quarterly, based on sales and operating profit determined in accordance with Peruvian generally accepted accounting principles. The royalty amount due is 1% of sales. An additional mining tax due is calculated based on the level of operating profit up to a maximum applicable rate is 12%. This component of the new mining tax only applies to those projects that are not covered by a tax stabilization agreement. During 2012 and 2011, $5,102 and $1,146, respectively, were included in~~Costs applicable to salesbased on 1% of revenue and $2,359 and $132 were included in~~~~Income and mining tax expense~~~~based on an average of 3.46% and 3.97% of operating profit, respectively.~~

~~Law N° 29789, Special Mining Tax~~

The Special Mining Tax (“IEM”) applies to mines not covered by a tax stabilization agreement. The IEM is payable on a quarterly basis with rates ranging from 2% to 8.4% of operating profit determined, in accordance with Peruvian~~generally accepted accounting principles.The rate varies depending on the level of operating profit. During 2012 and 2011, $6,900 and $1,319, respectively, were included in~~~~Income and mining tax expense~~~~due to the IEM based on average of 3.13% and 3.69% of operating profit, respectively.~~

~~Law N° 29790, Special Mining Charge~~

~~The Special Mining Charge (“GEM”) applies to mines covered by a tax stabilization agreement. The GEMis payable on a quarterly basis with rates ranging from 4% to 13.12% of operating profit, determined in accordance with Peruviangenerally accepted accounting principles.~~ The rate varies depending on the level of operating profit margin. The GEM applied to operations at Cerro Yanacocha and La Quinua in 2012 and the fourth quarter of 2011. This resulted in $68,644 and $19,661, respectively, of additional~~Income and mining tax expensebased on a 2012 average rate of 6.55% of operating profit and a 2011 average rate of 5.95% of operating profit.~~

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~

~~Law N°29471, Supplementary Fund~~

The Supplementary Fund for retirement of mining applies to metallurgical and steel workers, affiliated to the National Pension System - SNP and the Private Pension System – PPS; and is applicable since May 11, 2012. This Fund is formed by contributions of employees andemployer which are distributed according to the following detail:liability takes place either:

~~Employers will contribute 0.5% of~~In the ~~annual income before taxes.~~principal market for the asset or liability, or

~~Employees will contribute 0.5%~~In the absence of ~~their monthly gross salary.~~

~~The employer’s contributions are paid before tax; therefore these amounts are deductible expenses~~a principal market, in the most advantageous market for the ~~year.~~asset or liability.

F-122

~~The new pension fund tax is payable quarterly in accordance with Peruvian generally accepted accounting principles.~~ ~~During 2012 this amounts were~~ ~~included in~~~~Income and mining tax expense.~~

~~Peruvian Income Tax and Workers’ Profit Participation~~Notes to the consolidated financial statements (continued)

The ~~current income tax and workers’ profit participation expense (Note 13) was determined as follows:~~

Years Ended December 31,
2012 2011 2010
Income before workers’ profit participation and income tax in accordance with Peruvian GAAP $ 1,074,530 $ 988,887 $ 931,414
Plus:
Non-deductible expenses 27,503 26,247 33,622
Reclamation (environmental) reserve liability 33,910 61,732 24,944
Advanced projects (prior to operations) 49,904 26,502 -
Provision for government mining royalties 12,552 9,201 1,608
Capitalized interest amortization 4,357 5,363 4,879
Contingencies and commitments’ accruals 909 1,134 1,777
Intangible asset road amortization 2,849 2,849 -
Leasing benefit 7,534 6,552 (5,796 )
Provision for obsolescence of inventories 6,901 378 1,195
Conga Non-deductible expenses 45,413 - -
Other 10,915 4,297 16,649
202,747 144,255 78,878
Less:
Amortization and mineral interests (148,995 ) (86,752 ) (11,211 )
Tax amortization rate adjustment (19,332 ) (24,040 ) (19,872 )
Reclamation (environmental) reserve expense (7,661 ) (5,882 ) (5,191 )
Accounts receivable write-off - (1,293 ) 112
Other mining taxes (91,935 ) (24,134 ) -

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~

Years Ended December 31,
2012 2011 2010
Capitalized interest - - (4,404 )
Other - (2,823 ) -
(267,923 ) (144,924 ) (40,566 )
Base to calculate workers’ profit participation 1,009,353 988,218 969,726
Workers’ profit participation (8%) (80,748 ) (79,057 ) (77,578 )
Taxable income $ 928,605 $ 909,161 $ 892,148

Income tax (30%) $ 278,581 $ 272,748 $ 267,645
Credit for charitable donations _ (928 ) (930 )
Prior year adjustment _ (11,023 ) –
Adjustment due to income tax rate applicable to La Quinua (1,149 ) (1,836 ) (1,615 )
Current income tax $ 277,432 $ 258,961 $ 265,100

~~F-129~~

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~

~~Income Tax – Reconciliation from Peru Tax Return to Income Tax Expense and Tax Balance Sheets~~

~~The Company’s income tax provision consisted of the following:~~

Years Ended December 31,
2012 2011 2010
Current Peru tax return $ 277,432 $ 258,961 $ 265,100
Royalties and mining taxes 79,383 20,980 -
Other taxes 1,157 3,153 -
Income tax prior year adjustments (763 ) 12,934 505
Current 357,209 296,028 265,605
Deferred 4,648 (2,854 ) 3,932
Other - (136 ) 136
Income tax expense $ 361,857 $ 293,038 $ 269,673

~~Income tax expense differs from the amount computed by applying the statutory Peruvian corporate income tax rate of 30% to pre-tax income as a result of the following:~~

Years Ended December 31,
2012 2011 2010
Income before tax provision $ 928,605 $ 909,830 $ 853,836
Peruvian statutory rate 30 % 30 % 30 %
Income tax at statutory rate 278,581 272,949 256,151
Adjustment due to income tax rate applicable to La Quinua (1,149 ) (1,836 ) (1,615 )
Negotiated payment - - 4,004
Donations - 5,134 4,399
Other mining taxes 79,383 20,980 -
Other 5,042 (4,189 ) 6,734
Total income tax expense $ 361,857 $ 293,038 $ 269,673

~~Components of deferred income tax assets (liabilities) are as follows:~~

At December 31,
2012 2011
Deferred income tax assets:
Reclamation and remediation $ 72,584 $ 64,709
Accounts payable and accrued expenses 30,132 12,905
Deferred workers’ profit participation 5,498 5,094
Other 9,620 4,252
117,834 86,960
Deferred income tax liabilities:
Property, plant and mine development (161,471 ) (117,778 )
Inventories (23,796 ) (27,463 )
Other (2,231 ) (1,883 )
(187,498 ) (147,124 )
Net deferred income tax liabilities (69,664 ) $ (60,164 )

Current deferred income tax assets 4,378 $ 8,746

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~

At December 31,
2012 2011

Long-term deferred income tax liabilities (74,042 ) (68,910 )
Net deferred income tax liabilities (69,664 ) $ (60,164 )

~~Unrecognized Tax Benefits~~

~~At December 31, 2012 and 2011, the~~ Company had $1,198 and $5,566, respectively, of total gross unrecognized tax benefits that, if recognized, would impact the Company’s effective income tax rate. The Company’s continuing practice is to recognize interest and/or penalties related to unrecognized tax benefits as part of its income tax expense. The Company files income tax returns with Peruvian taxing authorities and is no longer subject to income tax audits by taxing authorities for years before 2008.

~~FAIR VALUE ACCOUNTING~~

~~Fair value accounting establishes a fair value hierarchy that prioritizes the inputs to~~uses valuation techniques ~~used~~that are appropriate in the circumstances and for which sufficient data are available to measure fair ~~value. The hierarchy gives~~value, maximizing the ~~highest priority to unadjusted quoted prices~~use of relevant observable inputs and minimizing the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in ~~active markets for identical assets or liabilities (Level 1 measurements) and~~ the ~~lowest priority to unobservable inputs (Level 3 measurements). The three levels of~~consolidated financial statements are categorized within the fair value hierarchy, ~~are~~ described, ~~below:~~

~~Level 1~~

~~Unadjusted quoted prices in active markets that are accessible at the measurement date for identical, unrestricted assets or liabilities;~~

~~Level 2~~

~~Quoted prices in markets that are not active, or inputs that are observable, either directly or indirectly, for substantially the full term of the asset or liability; and~~

~~Level 3~~

~~Prices or valuation techniques that require inputs that are both significant to the fair value measurement and unobservable (supported by little or no market activity).~~

The following table sets forth the Company’s assets measured at fair value on a recurring basis (at least annually) by level within the fair value hierarchy. As required by accounting guidance, assets and liabilities are classified in their entiretyas follows, based on the lowest level of input that is significant to the fair value ~~measurement.~~measurement as a whole:

Fair Value at December 31, 2012
Total Level 1 Level 2 Level 3
Assets:
San José Reservoir Trust assets $ 17,115 $ 17,115 $ – $ –
Provisional priced products sales $ 34 $ 34 $ – $ –

Level 1 - Quoted (unadjusted) market prices in active markets for identical assets or liabilities.

Level 2 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable.

Level 3 - Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.

~~MINERA YANACOCHA S.R.L.~~

For assets and liabilities that are recognized in the consolidated statements of financial position on a recurring basis, the Company determines whether transfers have occurred between levels in the hierarchy by reassessing categorization (based on the lowest-level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars~~The Company's Management determines the policies and procedures for both recurring fair value measurement and non-recurring measurement. At each reporting date, the Company's Management analyzes the movements in ~~thousands unless otherwise stated)~~the values of assets and liabilities which are required to be re-measured or re-assessed as per the Company’s accounting policies.

~~The Company’s SanJosé~~ ~~Reservoir Trust~~For the purpose of fair value disclosures, the Company has determined classes of assets ~~are made up~~and liabilities based on the nature, characteristics and risks of ~~marketable equity~~the asset or liability and ~~debt securities that are valued using quoted market prices in active markets and as such are classified within Level 1~~the level of the fair value ~~hierarchy.~~ hierarchy as explained above.

Significant judgments, estimates and assumptions

The preparation of the Company’s consolidated financial statements requires Management to make judgments, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. The estimates and assumptions are continuously evaluated and based on Management’s experience and other facts, including the expectations about future events which are reasonable under the current situation. Uncertainty about these estimates and assumptions could result in outcomes that require material adjustment to the carrying amount of assets and liabilities affected in future periods. Further information on each of these areas and how they impact the various accounting policies are described below and also in the relevant notes to the consolidated financial statements.

F-123

Notes to the consolidated financial statements (continued)

3.1.

Judgments

In the process of applying the Company’s accounting policies, Management has made the following judgments, which have the most significant effect on the amounts recognized in the consolidated financial statements:

(a)

Contingencies -

(b)

Development start date -

The Company assesses the status of each exploration project to determine when the development phase begins. One of the criteria used to evaluate the development start date is when the Company determines that the property can be economically developed.

(c)

Production start date -

The Company assesses the stage of each mine under development to determine when a mine moves into the production phase. The determination of the start date is based on the unique nature of each mining project; such as the complexity of the project and its location. The Company considers various relevant criteria to assess when the production phase is considered to have commenced. Some of the criteria used to identify the production start date include, but are not limited to:

Level of capital expenditure incurred compared to the original construction cost estimates.

Completion of a reasonable period of testing of the mine plant and equipment.

Ability to produce metal in saleable form (within specifications).

Ability to sustain ongoing production of metal.

3.2.

Estimates and assumptions

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The Company based its assumptions and estimates on parameters available when the consolidated financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market change or circumstances arising beyond the control of the Company. Such changes are reflected in the assumptions when they occur.

F-124

Notes to the consolidated financial statements (continued)

(a)

Determination of mineral reserves and resources -

The Company calculates its reserves using methods generally applied by mining and industry according to international guidelines. All estimated reserves represent estimated quantities of mineral proven and probable that under current conditions can be economically and legally processed.

The process of estimating quantities of reserves is complex and requires making subjective decisions when evaluating all geological, geophysical, engineering and economic information available. Reviews could occur on reserve estimates due to, among others, revisions to the data or geological assumptions, changes in prices, production costs and results of exploration activities. Changes in estimated reserves could affect the carrying value of mining concessions, development costs and property, plant and equipment, the charges in result for depreciation and amortization, and the carrying amount of the provision for closure of mining units.

(b)

Units of production depreciation -

Estimated economically recoverable reserves are used in determining the depreciation and/or amortization of mine-specific assets. This results in a depreciation/amortization charge proportional to the depletion of the anticipated remaining life-of-mine production. The life of each item, which is assessed at least annually, has regard to both its physical life limitations and present assessments of economically recoverable reserves of the mine property at which the asset is located. These calculations require the use of estimates and assumptions, including the amount of recoverable reserves. Changes in estimates are accounted for prospectively.

(c)

Mine rehabilitation provision -

The Company assesses its mine rehabilitation provision at each reporting date. The ultimate rehabilitation costs are uncertain, and cost estimates can vary in response to many factors, including estimates of the extent and costs of rehabilitation activities, technological changes, regulatory changes, cost increases as compared to the inflation rates, and changes in discount rates. These uncertainties may result in future actual expenditure differing from the amounts currently provided. The provision at reporting date represents Management’s best estimate of the present value of the future rehabilitation costs required.

(d)

Inventories, net -

Stockpiles and ore on leach pads are measured by estimating the number of tons added and removed from the stockpile and leach pads, the number of contained gold ounces, assay data, and the estimated recovery percentage based on the expected processing method. Stockpile and ore on leach pad tonnages are verified by periodic surveys.

F-125

Notes to the consolidated financial statements(continued)

(e)

Impairment of non-financial assets -

The Company assesses each asset or cash generating unit in each reporting period to determine whether any indication of impairment exists. Where an indicator of impairment exists, a formal estimate of the recoverable amount is made, which is considered to be the higher of the fair value less costs of disposal and value in use. The assessments require the use of estimates and assumptions such as long-term commodity prices, discount rates and operating costs, among others. These estimates and assumptions are subject to risk and uncertainty.

The fair value of ~~the marketable equity securities~~mining assets is calculated by the present value of future cash flows arising from the continued use of the asset, which include some estimates, such as the ~~quoted~~cost of future expansion plans, using assumptions that a third party might consider. The future cash flows are discounted to their present value using a discount rate that reflects current market ~~price~~assessment of the ~~marketable equity security multiplied by~~value of money over time, as well as specific risks of the ~~quantity of shares held by the Company.~~asset or cash-generating unit under evaluation.

The ~~Company’s net trade receivable from provisional silver, gold, carbon fines~~Company has determined the operations of Yanacocha and ~~copper concentrate sales~~Conga as the cash generating units.

(f)

Taxes -

Deferred tax assets are recognized for unused tax losses to the extent that it is ~~valued using quoted market prices~~probable that taxable profit will be available against which the losses can be utilized. Significant Management judgment is required to determine the amount of deferred tax assets that can be recognized, based onupon the ~~forward the COMEX Silver Index, the London Bullion Market Association P.M. fix (“London P.M. fix”) (gold),~~likely timing and the ~~London Metal Exchange (“LME”) (copper),~~level of future taxable profits together with future tax planning strategies.

Standards issued but not effective

The standards and ~~as such is classified within Level 1~~interpretations that are issued, but not yet effective, up to the date of issuance of the ~~fair value hierarchy.~~Company’s financial statements that the Company reasonably expects will have an impact on its disclosures, financial position or performance when applied at a future date are disclosed below. The Company intends to adopt these standards, if applicable, when they become effective. The Company has not listed other standards and interpretations that are issued, but not yet effective, as these are not expected to impact the Company.

IFRS 9 Financial Instruments

In July 2014, the IASB issued the final version of IFRS 9 Financial Instruments that replaces IAS 39 and all previous versions of IFRS 9. IFRS 9 brings together all three aspects of the accounting for financial instruments project: classification and measurement, impairment and hedge accounting. IFRS 9 is effective for annual periods beginning on or after January 1, 2018, with early application permitted. Except for hedge accounting, retrospective application is required, but the provision of comparative information is not compulsory. For hedge accounting, the requirements are generally applied prospectively, with some limited exceptions.

F-126

Notes to the consolidated financial statements (continued)

IFRS 15 Revenue from Contracts with Customers

IFRS 15 was issued in May 2014 and establishes a five-step model to account for revenue arising from contracts with customers. Under IFRS 15, revenue is recognized at an amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring goods or services to a customer. The new revenue standard will supersede all current revenue recognition requirements under IFRS. Either a full retrospective application or a modified retrospective application is required for annual periods beginning on or after January 1, 2018. Early adoption is permitted.

Amendments to IFRS 10 and IAS 28: Sale or Contribution of Assets between an Investor and its Associate or Joint Venture

Cash and cash equivalents

(a)

This caption is made up as follows:

	2015		2014
	US$(000)		US$(000)

Petty cash		51		53
Bank accounts		142,725		287,762
Term deposits (b)		800,985		498,809

		943,761		786,624

The term deposits balance is made as follows:

	2015		2014
	US$(000)		US$(000)

Citi Bank		620,025		318,001
HSBC		180,960		180,808

		800,985		498,809

(b)

The bank accounts and term deposits yield interest at market rates. Because of the short maturity of these balances, less than 90 days, the carrying amounts approximate their fair value.

F-127

Notes to the consolidated financial statements (continued)

Trade and other receivables, net

(a)

This caption is made up as follows:

	2015			2014
	US$(000)			US$(000)

Trade receivables, net
Foreign clients		5,181			5,352

Other receivables
Advances to suppliers		13,052			14,880
Tax claims		5,273			5,882
Other minors		4,079			7,888
Related entities, Note 21		248			36,017
		22,652			64,667

Allowance for doubtful accounts (b)		(1,444	)		(1,788	)
		21,208			62,879

Total trade and other receivables, net		26,389			68,231

The trade and other receivables have current maturities.

There are no trade receivables that are past at December 31, 2015 and 2014.

(b)

The allowance for doubtful accounts had the following movement during the years 2015, 2014 and 2013:

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Opening balance		1,788			5,934			7,816
Additions		88			812			717
Deductions		(432	)		(4,958	)		(2,599	)

Ending balance		1,444			1,788			5,934

In the opinion of the Company’s Management, the balance of the allowance for doubtful accounts is sufficient to cover adequately the risks of failure to date in the consolidated statement of financial position.

F-128

Notes to the consolidated financial statements (continued)

~~ACCOUNTS RECEIVABLE~~Inventories, net

(a)

This caption is made up as follows:

At December 31,
2012 2011
Value added tax $ 71,498 $ 67,765
Equipment and fuel receivables 19,973 -
Trade accounts receivable 730 1
Employee receivables 793 307
Other 7,545 6,535
$ 100,539 $ 74,608

	2015			2014
	US$(000)			US$(000)

Precious metals		404			3,265
Leach in-circuit		5,950			7,269
Mill in-circuit		1,580			815
Materials and supplies		54,711			58,386
		62,645			69,735
Allowance for obsolescence of materials and supplies (b)		(5,881	)		(4,832	)

		56,764			64,903

(b)

The allowance for obsolescence of material and supplies had the following movement during the years 2015, 2014 and 2013:

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Opening balance		4,832			5,568			3,297
Provision for impairment of materials and supplies		5,060			2,849			2,271
Reversal of provision for impairment of materials and supplies		(4,011	)		(3,585	)		-

Ending balance		5,881			4,832			5,568

~~INVENTORIES~~Stockpiles and ore on leach pads

(a)

This caption is made up as follows:

At December 31,
2012 2011
Leach in-process $ 4,624 $ 17,984
Mill in-circuit 13,620 1,092
Precious metals 7,942 2
Materials and supplies 61,227 44,423
$ 87,413 $ 63,501

	2015			2014
	US$(000)			US$(000)

Current portion -
Stockpiles		91,920			137,852
Ore on leach pads		210,517			204,148
Provision for net realizable value adjustment (b)		(64,827	)		(71,489	)

		237,610			270,511
Non-current portion -
Stockpiles		95,484			92,217
Ore on leach pads		138,470			215,197
Provision for net realizable value adjustment (b)		(25,471	)		(91,605	)

		208,483			215,809

F-129

Notes to the consolidated financial statements (continued)

(b)

The provision for net realizable value adjustment had the following movement during the years 2015, 2014 and 2013:

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Opening balance		163,094			147,342			5,375
Provision		64,497			95,859			146,051
Reversal of provision		(137,293	)		(80,107	)		(4,084	)

Ending balance		90,298			163,094			147,342

~~STOCKPILES AND ORE ON LEACH PADS~~Available-for-Sale Financial Assets

At December 31,
2012 2011
Current:
Stockpiles $ 30,979 $ 36,384
Ore on leach pads 114,567 123,329
$ 145,546 $ 159,713
Long-term:
Stockpiles $ 88,615 $ 71,474
Ore on leach pads 263,471 280,468
$ 352,086 $ 351,942

~~MINERA YANACOCHA S.R.L.~~In November 2008, the Company funded the San Jose Reservoir Trust for US$13 million to ensure the continuity of the Company's operations in the San Jose Reservoir after 2018. Such trust is irrevocable and is a separate legal entity of the Company. The grantor is the Company, the trustee is the Banco de Credito del Peru and the beneficiary is the Company; therefore, the Company consolidates the trust. As of December 31, 2015, the trust total balance is US$15,803,000 and is presented as Available-for-sale financial assets (trust total balance of US$16,884,000 as of December 31, 2014).

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~During 2015, these investments, denominated in U.S. dollars, accrued losses net of taxes of US$757,000 (income of US$65,000 and loss of US$226,000 in 2014 and 2013, respectively) which are included in other comprehensive income.

~~(dollars in thousands unless otherwise stated)~~

F-130

Notes to the consolidated financial statements (continued)

10.

~~OTHER ASSETS~~Property, plant and equipment, net

(a)

Below is presented the movement in cost:

At December 31,
2012 2011
Other current assets:
Prepayments to suppliers and contractors 14,510 $ 11,084
Claims for tax refunds 4,335 4,335
Restricted cash 1,045 943
Prepaid expenses and other 2,444 5,281
22,334 $ 21,643
Other long-term assets:
Intangible assets, net 54,549 $ 59,748
San José Reservoir Trust assets 17,127 15,502
Other 2,134 1,404
$ 73,810 $ 76,654

	Opening balance		Additions		Sales and Disposals			Transfer/Other changes			Final balances
	US$(000)		US$(000)		US$(000)			US$(000)			US$(000)

Year 2015
Cost-
Land		15,335		-		(272	)		233			15,296
Land improvements		22,730		-		-			-			22,730
Building and constructions		622,928		-		(304	)		51,856			674,480
Machinery and equipment		322,441		-		(25,211	)		25,460			322,690
Leach pads		571,388		-		-			-			571,388
Vehicles		9,278		-		(1,186	)		32			8,124
Furniture and fixtures		2,031		-		-			-			2,031
Other equipment		64,137		225		(58	)		4,679			68,983
Work in progress		593,906		99,336		-			(92,887	)		600,355
Mining rights		33,800		-		-			-			33,800
Asset retirement and mine closure		245,903		10,434		-			-			256,337
Stripping activity asset		157,649		18,868		-			-			176,517
Mine development		475,441		-		-			10,491			485,932
		3,136,967		128,863		(27,031	)		(136	)		3,238,663

Accumulated depreciation and amortization
Land improvements		15,812		-		-			(5,334	)		10,478
Building and constructions		310,906		72,899		(95	)		-			383,710
Machinery and equipment		213,795		20,999		(21,732	)		-			213,062
Leach pads		519,142		26,779		-			-			545,921
Vehicles		8,086		800		(1,111	)		-			7,775
Furniture and fixtures		1,991		11		-			-			2,002
Other equipment		55,928		1,600		(58	)		-			57,470
Mining rights		19,744		-		-			-			19,744
Asset retirement and mine closure		121,102		48,135		-			-			169,237
Stripping activity asset		138,178		-		-			-			138,178
Mine development		276,954		44,188		-			5,334			326,476
		1,681,638		215,411		(22,996	)		-			1,874,053

Net cost		1,455,329										1,364,610

F-131

Notes to the consolidated financial statements (continued)

	Opening balance		Additions		Sales and Disposals			Impairment loss			Transfer/Other changes			Final balances
	US$(000)		US$(000)		US$(000)			US$(000)			US$(000)			US$(000)

Year 2014
Cost-
Land		21,142		-		(243	)		(5,564	)		-			15,335
Land improvements		30,977		-		-			(8,247	)		-			22,730
Building and constructions		670,767		-		(1,250	)		(225,977	)		179,388			622,928
Machinery and equipment		493,703		-		(80,982	)		(116,971	)		26,691			322,441
Leach pads		691,535		-		-			(207,279	)		87,132			571,388
Vehicles		13,651		-		(1,011	)		(3,362	)		-			9,278
Furniture and fixtures		2,742		-		-			(711	)		-			2,031
Other equipment		87,557		96		(434	)		(23,262	)		180			64,137
Work in progress		985,759		111,598		-			(215,449	)		(288,002	)		593,906
Mining rights		46,061		-		-			(12,261	)		-			33,800
Asset retirement and mine closure		270,589		64,520		-			(89,206	)		-			245,903
Stripping activity asset		110,349		104,487		-			(57,187	)		-			157,649
Mine development		644,904		-		-			(172,476	)		3,013			475,441

		4,069,736		280,701		(83,920	)		(1,137,952	)		8,402			3,136,967

Accumulated depreciation and amortization
Land improvements		19,080							(5,737	)		2,469			15,812
Building and constructions		348,455		70,578		(629	)		(112,786	)		5,288			310,906
Machinery and equipment		302,722		28,117		(39,137	)		(77,558	)		(349	)		213,795
Leach pads		674,162		32,691		-			(188,326	)		615			519,142
Vehicles		10,708		432		(987	)		(2,930	)		863			8,086
Furniture and fixtures		2,675		11		-			(697	)		2			1,991
Other equipment		74,731		687		(230	)		(20,285	)		1,025			55,928
Mining rights		6,208		-		-			(7,162	)		20,698			19,744
Asset retirement and mine closure		126,291		39,214		-			(43,932	)		(471	)		121,102
Stripping activity asset		66,029		96,785		-			(50,124	)		25,488			138,178
Mine development		342,726		85,534		-			(100,471	)		(50,835	)		276,954
		1,973,787		354,049		(40,983	)		(610,008	)		4,793			1,681,638

Net cost		2,095,949													1,455,329

Additions to work in progress in 2015 are primarily related to the Water treatment project and Yanacocha Laybacks Checkpoint 2A and Asset Componetization project.

The depreciation and amortization expense for the year ended December 31, 2015, was recorded as Cost applicable to sales in the statement of comprehensive income.

F-132

Notes to the consolidated financial statements (continued)

(b)

Impairment of long-lived assets -

In accordance with its accounting policies and processes, each asset or Cash Generating Unit “CGU” is evaluated annually at year end, to determine whether there are any indications of impairment. If any such indications of impairment exist, a formal estimate of the recoverable amount is performed.

In assessing whether impairment is required, the carrying value of the asset or CGU is compared with its recoverable amount. The recoverable amount is the higher of the CGU’s fair value less costs of disposal (FVLCD) and value in use (VIU). Given the nature of the Company’s activities, information on the fair value of an asset is usually difficult to obtain unless negotiations with potential purchasers or similar transactions are taking place. Consequently, the recoverable amount for each CGU is estimated based on estimated discounted future estimated cash flows expected to be generated from the continued use of the CGUs using market based commodity price and exchange assumptions, estimated quantities of recoverable minerals, production levels, operating costs and capital requirements, and its eventual disposal, based on the latest life of mine (LOM) plans. These cash flows are discounted using a real pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the CGU.

Estimates include quantities of recoverable minerals, production levels, operating costs and capital requirements and sourced from out planning process, including the LOM plans, one-year budgets and CGU-specific studies.

As a result of the recoverable amount analysis performed during the year, the Company did not recognize an impairment loss related to mine properties in 2015.In 2014, the Company recorded an impairment loss amounting to US$541 million related to Conga, and no loss was recorded for Yanacocha (US$1,038 million for the year ended December 31, 2013: US$453 million related to Yanacocha and US$585 million related to Conga).

Key assumptions used for the impairment testing as of December 31, 2015:

The determination of value in use is most sensitive to the following key assumptions:

Production volumes

Commodity prices

Discount rate

F-133

Notes to the consolidated financial statements (continued)

As each producing mining unit has specific reserve characteristics and economic circumstances, the cash flows of ~~December 31, 2012,~~~~Prepayments~~the mines are computed using appropriate individual economic models and key assumptions established by management. The production profiles used were consistent with the reserves and resource volumes approved as part of the Company’s process for the estimation of proved and probable reserves and resource estimates.

Commodity prices: Forecasted commodity prices are based on management’s estimates and are derived from forward price curves and long-term views of global supply and demand, building on past experience of the industry and consistent with external sources. These prices were adjusted to ~~suppliers~~arrive at appropriate consistent price assumptions for the different qualities and ~~contractors~~ ~~is related~~type of commodities, or, where appropriate, contracted prices were applied. These prices are reviewed at least annually.

Estimated prices for the current and long-term periods that have been used to estimate future revenues are as follows:

	Current		Long-term
	US$		US$

Gold (per ounce)		1,106		1,300
Copper (per pound)		2.50		3.00

Discount rate: In calculating the value in use, a pre-tax discount rate of 8.4% was applied to the ~~purchase~~pre-tax cash flows. This discount rate is derived from the Company’s post-tax weighted average cost of ~~equipment of $3,398, supplies of $91 and other services $11,021.~~

~~Intangible assets relate~~capital (WACC), with appropriate adjustments made to ~~an alternative road~~reflect the risks specific to the ~~coast.~~CGU.

11.

~~PROPERTY, PLANT AND MINE DEVELOPMENT, NET~~Trade and other payables

(a)

This caption is made up as follows:

At December 31, 2012 At December 31, 2011
Cost Accumulated
Amortization Net Book
Value Cost Accumulated
Amortization Net Book
Value
Land $ 76,397 $ - $ 76,397 $ 76,300 $ - $ 76,300
Facilities and equipment 2,457,548 (1,810,348 ) 647,200 2,345,712 (1,655,887 ) 689,825
Mine development 930,709 (408,700 ) 522,009 673,704 (323,736 ) 349,968
Mineral interests 69,779 (8,934 ) 60,845 69,408 (7,898 ) 61,510
Asset retirement cost 451,647 (164,240 ) 287,407 288,597 (150,420 ) 138,177
Construction-in-progress 1,526,315 - 1,526,315 915,432 - 915,432
$ 5,512,395 $ (2,392,222 ) $ 3,120,173 $ 4,369,153 $ (2,137,941 ) $ 2,231,212

	2015		2014
	US$(000)		US$(000)

Trade payables (b)
Domestic suppliers		56,447		69,788
Related entities, Note 21		10,792		51,071

		67,239		120,859

Other payables
Remuneration and similar benefits payable		8,981		13,390
Royalties payable to the Peruvian State		1,541		3,758
Taxes payable		489		812

		11,011		17,960

		78,250		138,819

~~Construction - in - progress for 2012 of $1,526,315 related primarily to leach pad development, surface development and Conga reservoir engineering and procurement activities.~~

(b)

Trade payables arise mainly from the acquisition of materials, supplies and spare parts and services provided by third parties. These obligations, have current maturities, accrue no interest, are not secured and are mostly denominated in U.S. dollars.

~~Construction - in - progress for 2011 of $915,432 primarily related to project development costs for Conga and leach pad expansion.~~

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~Notes to the consolidated financial statements (continued)

~~(dollars in thousands unless otherwise stated)~~

	~~Method~~	~~Depreciable~~ ~~Life (in~~ ~~years)~~
~~Other~~			5
~~Mine development~~	~~UOP based on ounces mined~~		~~8 to 21~~
~~Mineral interests~~	~~UOP for producing property~~		12
~~Asset retirement cost~~	~~Related asset~~		~~5 to 15~~

At December 31, 2012 At December 31, 2011
Gross
Carrying
Value Accumulated
Amortization Net Book
Value Gross
Carrying
Value Accumulated
Amortization Net Book
Value
Mineral Interest

Production stage $ 32,299 $ (8,760) $ 23,539 $ 31,928 $ (7,724 ) $ 24,204
Development stage 20,298 (174 ) 20,124 20,298 (174 ) 20,124
Exploration stage 17,182 - 17,182 17,182 - 17,182
$ 69,779 $ (8,934) $ 60,845 $ 69,408 $ (7,898 ) $ 61,510

12.

~~DUE TO/FROM RELATED PARTIES~~Provisions

(a)

This caption is made up as follows:

~~The Company has the following amounts due from and to related parties:~~

At December 31,
2012 2011
Due from related parties:
Newmont Boddington Gold Pty Ltd $ 6,466 $ -
Newmont USA Limited 4,988 -
Newmont International Service Limited 2,592 -
Newmont Insurance Limited 1,000 1,000
Suriname Gold 374 132
Newmont Peru S.R.L. 148 -
Newmont Santa Fe Pacific Chile 26 92
Newmont (Other) 1,611 -
$ 17,205 $ 1,224

At December 31,
2012 2011
Due to related parties:
Newmont USA Limited $ 17,161 $ 6,392
S.M.R.L. Chaupiloma Dos de Cajamarca 12,557 17,368
Newmont Technologies Limited 6,687 2,199
Newmont International Service Limited 5,865 -
Newmont Peru S.R.L. 5,193 8,393
Newmont Santa Fe Pacific Chile 315 964
Newmont (Other) 1,621 -
$ 49, 399 $ 35,316

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~

Management, exploration, mine development, engineering and employment services are received pursuant to contracts with affiliates. The corresponding charges totaled $88,476 and $66,506 in 2012 and 2011, respectively.

As described in Note 1, the Company pays to Chaupiloma a 3% royalty based on quarterly production sold at current market prices, after deducting refinery and transportation costs. Royalty expense totaled $66,586, $60,816 and $55,765 in 2012, 2011 and 2010, respectively and is included in~~Costs applicable to sales~~.

	2015			2014
	US$(000)			US$(000)

Provision for closure of mining units and exploration projects (b)		578,959			557,457
Provision of social responsibility		29,083	��		28,727
Workers’ profit sharing payable (c)		19,526			31,053
Accrual of operating costs		13,319			10,895
Other provisions		5,122			1,005

		646,009			629,137

Classification by maturity:
Current portion		41,961			55,585
Non-current portion		604,048			573,552

		646,009			629,137

~~13.~~(b)

~~WORKERS’ PROFIT PARTICIPATION~~Provision for closure of mining units and explorations projects.

In accordance with Peruvian legislation, the Company maintains an employee profit sharing plan equal to 8% of annual taxable income. Distributions to employees under the plan are based 50% on the number of days that each employee worked during the preceding year and 50% on proportionate annual salary levels.

~~In 2012, 2011 and 2010, the current expense portion of workers’ profit participation amounted to $80,748, $79,057 and $77,578, respectively, which was included in~~~~Costs applicable to sales~~.

Peruvian law limits payments of annual profit sharing per employee to eighteen months salary but continues to base total profit sharing on 8% of taxable income, notwithstanding the per employee limitation. Supreme Decree N°009-98-TR, published on August 6, 1998, provides that the excess of total profit sharing for the year over aggregate profit sharing payable to all employees be paid to the Fondo Nacional de Capacitación Laboral y de Promoción del Empleo (“FONDOEMPLEO”).Law 28464 published in January 2005, which modified art.3 of Law Decree 892, provides that the excess of total profit sharing for the year over aggregate profit sharing payable to all employees be applied to training of employees and construction of public facilities. Supreme Decree N° 002-2005-TR, published in May 6, 2005, establishes a limit of 2,200 UIT (inflation measurement unit, of S/.3,650 new Peruvian sol per unit at December 31, 2012) in the contributions to FONDOEMPLEO indicating that the difference goes to the Regional Government.

~~14.~~

~~OTHER CURRENT LIABILITIES~~

At December 31,
2012 2011
Accrued capital expenditures $ 56,296 $ 111,438
Contractors fund retention guarantee 32,524 23,980
Accrued operating costs 18,686 17,051
Reclamation and remediation 21,411 10,598
Payroll and other benefits 9,053 10,425
Taxes other than income and mining 2,194 8,025
Income tax withholding 3,222 5,832
Deferred revenues 660 4,270
Other 1,032 1,123
$ 145,078 $ 192,742

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~

~~Accrued capital projects are mainly related to Conga, Western Oxides, Carachugo Water Treatment and other minor projects.~~

~~15.~~

~~RECLAMATION AND REMEDIATION~~

The ~~Company’s~~Company's mining and exploration activities are subject to various laws and regulations governing the protection of the environment. These laws and regulations are continually changing and are generally becoming more restrictive. The Company conducts its operations so as to protect the public health and environment and believes its operations are in compliance with all applicable laws and regulations in all material respects. The Company has made, and expects to make in the future, expenditures to comply with such laws and regulations, but cannot predict the amount of such future expenditures. Estimated future reclamation costs are based principally on legal and regulatory requirements.

The liability ~~corresponds primarily to~~for reclamation or the Asset retirement obligation (“ARO”) comprises activities ~~to be performed~~carried out by the Company in the ~~reclamation~~restoration of mines and ~~remediation~~adjacent areas in the completion stage of ~~mining activities once~~ the gold extraction ~~process has been finished. These~~process. Such activities include ~~reclamation~~the restoration of ~~the mine sites, operating~~mining locations, water treatment ~~plants, revegetation~~plant operations, as well as reforestation and ~~earthworks.~~land treatments.

F-135

Notes to the consolidated financial statements (continued)

The ~~following~~movement of the ARO for 2015, 2014 and 2013 is ~~a reconciliation of reclamation and remediation liabilities:~~broken down as follows:

Years Ended December 31,
2012 2011 2010

Balance at beginning of year $ 353,875 $ 287,890 $ 191,435
Addtions change in estimates and other settled 163,050 52,732 87,182
Liabilities settled (7,661 ) (5,882 ) (5,191 )
Accretion expense 20,090 19,135 14,464
Balance at end of year $ 529,354 $ 353,875 $ 287,890

~~The current portion of~~~~Reclamation and remediation~~~~of $21,411 and $10,598 at December 31, 2012 and 2011, respectively, are included in~~~~Other current liabilities~~.

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Opening balance		557,457			460,127			392,217
Additional provisions		10,434			84,835			54,184
Payments		(11,007	)		(10,419	)		(4,387	)
Unwinding of discount, Note 19		22,075			22,914			18,113

Final balance		578,959			557,457			460,127

Classification by maturity
Current portion		6,698			15,112			34,848
Non-current portion		572,261			542,345			425,279

		578,959			557,457			460,127

The increase in the asset retirement obligation in ~~2012~~2015 relates to additional ~~remediation and~~ reclamation requirements caused by the impact of mining activities during ~~2012,~~2015, additional costs for waste rock reclamation and new Peruvian regulatory requirements that extended the water treatment and monitoring requirements more than 20 years.

~~MINERA YANACOCHA S.R.L.~~

(c)

Workers' profit sharing -

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~In accordance with Peruvian legislation, the Company maintains an employee profit sharing plan equal to 8% of annual taxable income. Distributions to employees under the plan are based 50% on the number of days that each employee worked during the preceding year and 50% on proportionate annual salary levels.

~~16.~~13.

~~PARTNERS’ EQUITY~~Partners’ equity, net

(a)

Partners’ contributions -

~~Partners’ Contributions~~

Partners’ contributions ~~represent~~ comprise1,278,451,304 common partnership interests ~~with a~~at par value of one Peruvian ~~Nuevo sol~~Sol each, fully subscribed and ~~paid.~~paid-in. Such partnership interest includes 720,407,310 shares that are owned by foreign investors.

Under current Peruvian regulations, there is no restriction on the remittance of dividends or repatriation of foreign investment, except as discussed in sections below.

The legal structure of the Company is that of a ~~Limited Liability Partnership. The main characteristics~~Peruvian limited liability partnership. Major features of such legal structure are: (i) the number of Partners cannot exceed 20, (ii) ~~the~~ capital ~~is represented by~~comprises the partnership interests, and (iii) there is no obligation to create a legal reserve.

(b)

Retained earnings -

~~Retained Earnings~~

~~Effective January 1, 2003, distribution~~Distribution of earnings ~~for~~to Partners other than legal entities domiciled in Peru is subject to a withholding income tax charged to the partners.

F-136

Notes to the consolidated financial statements (continued)

For individuals and non-resident legal entities, the applicable tax rate is 6.8% for dividend distributions in cash or non-monetary assets for fiscal years 2015 and 2016; whereas during fiscal years 2017 and 2018 the applicable tax rate will be 8.8%; and 9.3% from 2019, onward.

14.

Tax Situation

(a)

Tax stabilization agreements

The Company has entered into the following tax stability agreements, each with a term of ~~4.1%~~15 years:

Mine	Effective	Date of the Tax Agreement	Tax Regimes in Force

Cerro Yanacocha	January 1, 2000	September 16, 1998	May 22, 1997
La Quinua	January 1, 2004	August 25, 2003	August 25,2003

The Cerro Yanacocha tax stabilization agreement expired on January 1, 2015 and is no longer in effect.

The agreement for La Quinua guarantees the Company's use of the tax regime shown in the table above and permits maintenance of its accounting records in U.S. dollars for tax purposes.

The Company determines taxable income based on its understanding and that of its legal advisors, of applicable tax legislation. Taxable income differs from pre-tax income disclosed within these financial statements by those items that the applicable tax legislation deems to be non-taxable or non-deductible.

For the year 2015, the income tax rate was 28%, except for the La Quinua mine, which was 29%.

~~Accumulated Other Comprehensive~~On December 31, 2014, the Peruvian Government enacted modifications to Income Tax regulations, effective January 1, 2015. Among the modifications, a progressive income tax rate reduction was approved as follows: 28% for fiscal years 2015 and 2016; 27% for fiscal years 2017 and 2018; and 26% from 2019, onward.

At December 31,
2012 2011

Unrealized gain on marketable securities, net of taxes $ 2,006 $ 877
$ 2,006 $ 877

(b)

Other mining taxes -

(i)

Law No.29788, Mining Royalties

On 28 September 2011, the Peruvian Government enacted new legislation to comprise a new mining tax payable to the Peruvian Government for extracting metallic and non-metallic mineral resources from its mining concessions.

Pursuant to this legislation, the mining royalty is payable quarterly based on sales and operating profit determined in accordance with IFRS. The royalty amount due is 1% of revenue. An additional mining tax due is calculated based on the level of operating profit up to a maximum applicable rate of 12%. This component of the new mining tax only applies to those projects that are not covered by a tax stabilization agreement. During 2015, 2014 and 2013, the amounts included in cost of production were US$2,456,000, US$8,291,000 and US$7,247,000, respectively and during 2014 and 2013 the amounts included in mining tax expense were US$ 1,714,000 and US$6,245,000, respectively.

F-137

Notes to the consolidated financial statements (continued)

(ii)

Law No.29789, Special Mining Tax

The Special Mining Tax ("IEM") applies to mines not covered by a tax stabilization agreement. The IEM is payable on a quarterly basis with rates ranging from 2% to 8.4% of operating profit determined, in accordance with IFRS.

The rate varies depending on the level of operating profit. During 2015, 2014 and 2013 the amounts included in income and mining tax expense were US$1,838,000, US$5,479,000 and US$11,721,000, respectively.

(iii)

Law No. 29790, Special Mining Burden

The Special Mining Burden ("GEM") applies to mines covered by a tax stabilization agreement. The GEM is payable on a quarterly basis with rates ranging from 4% to 13.12% of operating profit, determined in accordance with IFRS. The rate varies depending on the level of operating profit margin. The GEM applied to operations at Cerro Yanacocha and La Quinua in 2015, 2014 and 2013. This resulted in US$19,883,000, US$7,156,000 and US$22,707,000, respectively, of additional Income and mining tax expense.

(iv)

Law No. 29471, Supplementary Fund

The Supplementary Fund for retirement of mining applies to metallurgical and steel workers, affiliated to the National Pension System (“SNP”) and the Private Pension System (“PPS”); and is applicable since May 11, 2012. This Fund is formed by employee and employer contributions which are distributed according to the following detail:

Employers will contribute 0.5% of the annual income before taxes;

Employees will contribute 0.5% of their monthly gross salary;

The employer's contributions are paid before tax; therefore these amounts are deductible expenses for the year.

The new pension fund tax is calculated based on annual income determined in accordance with Peruvian generally accepted accounting principles and is payable quarterly. During 2015 and 2014, the amounts included in Income and mining tax expense amounted to US$459,000 and US$2,288,000, respectively.

F-138

Notes to the consolidated financial statements (continued)

(c)

Peruvian income tax

The Company's income tax provision consisted of the following:

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Current Peruvian tax returns		98,319			123,007			175,542
Royalties and mining taxes		21,721			14,349			40,673
Other taxes		639			914			590
Income tax prior year adjustments		(1,766	)		-			10,348
Current income tax expense		118,913			138,270			227,153
Deferred income tax expense (benefit)		483,804			(168,761	)		(430,624	)

Income tax expense (benefit)		602,717			(30,491	)		(203,471	)

(d)

Deferred income tax asset

Components of deferred income tax assets (liabilities) are as follows:

	2015			2014
	US$(000)			US$(000)

Deferred income tax assets, net
Property, plant and mine development		303,385			326,496
Reclamation		110,633			90,573
Accounts payable and accrued expenses		66,261			46,873
Inventories		24,887			15,903
Other		4,838			3,662
		510,004			483,507
Deferred income tax liabilities
Other		-			(28	)
		510,004			483,479

Allowance of deferred income tax asset		(510,004	)		-

Net deferred income tax asset		-			483,479

In December 2015, the Company recorded a valuation allowance on its deferred income tax asset of US$510 million to the extent that it is not probable that taxable profit will be available against which the deductible temporary differences can be utilized.

F-139

Notes to the consolidated financial statements (continued)

(e)

Reconciliation of income tax expense (benefit) –

Below is a reconciliation of tax expense and the accounts profit multiplied by the statutory tax rate for the years 2015, 2014 and 2013:

	2015		2014			2013
	US$(000)		US$(000)			US$(000)

Income (loss) before income tax		152,522		(430,829	)		(778,750	)
Peruvian statutory tax rate		28%		30%			30%
Income tax expense (income)		42,706		(129,249	)		(233,625	)
Valuation allowance on deferred tax asset		510,004		-			-
Effect of change in income tax rate net		16,576		65,020			-
Mining taxes		15,639		10,044			40,672
Non-deductible expenses		15,288		24,832			(8,894	)
Adjustment due to income tax rate applicable to La Quinua		2,504		(1,138	)		(1,624	)

Total income tax expense (benefit)		602,717		(30,491	)		(203,471	)

15.

Revenue from sales

The Company’s revenues are mainly from sales of gold ounces. The table below presents the net sales to customers by geographic region:

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Sales and services by geographic region:
Metal sales
Suiza		754,335			851,577			965,934
America		315,686			358,880			492,211
		1,070,021			1,210,457			1,458,145

Royalties (note 1)		(32,414	)		(36,867	)		(44,185	)
Mining royalties to the government		(6,433	)		(8,291	)		(7,135	)

		1,031,174			1,165,299			1,406,825

F-140

Notes to the consolidated financial statements (continued)

16.

Costs applicable to sales

This caption is made up as follows:

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Beginning balance of inventories		497,669			522,596			545,183
Consumption of supplies		210,384			246,106			300,792
Personnel expenses		102,867			87,290			120,568
Other services		76,490			82,805			66,670
Maintenance		38,646			38,526			52,486
Power		27,713			24,942			29,142
Depreciation and amortization		223,142			360,334			349,760
Workers' profit participation		28,852			35,055			49,259
Reclamation expenses related to Yanacocha leach pad		-			20,315			-
Net realizable value adjustment		64,497			95,859			146,051
Ending balance of inventories		(518,524	)		(593,528	)		(668,647	)

		751,736			920,300			991,264

17.

~~SUPPLEMENTAL CASH FLOW INFORMATION~~Operating expenses, net

~~Net cash provided from operations includes the following cash payments:~~This caption is made up as follows:

Years Ended December 31,
2012 2011 2010
Income and mining taxes paid $ 392,741 $ 276,740 $ 332,954
Interest paid, net of amounts capitalized $ - $ 24 $ 1,737

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Exploration and advanced projects		64,230			58,880			64,510
Severance program		14,904			16,438			19,323
Write-off of fixed assets		2,411			3,520			584
Cost of fixed assets sold		1,624			39,425			23,246
Income from fixed asset sales		(1,116	)		(40,651	)		(45,772	)
Others, net		793			169			15,643

		82,846			77,781			77,534

18.

~~MAJOR CUSTOMERS AND EXPORT SALES~~Administrative expenses

~~The Company~~This caption is not economically dependent on a limited number of customers for the sale of its product because gold can be sold through various commodity market traders worldwide. In 2012, sales to one customer accounted for $1,580 which represented 72% of total annual sales. In 2011, sales to one customer accounted for $1,419,109 which represented 71% of total annual sales. In 2010, sales to one customer accounted for $1,326,000 which represented 75% of total annual sales. All gold sales were made ~~outside of Peru.~~

~~MINERA YANACOCHA S.R.L.~~up as follows:

	2015		2014		2013
	US$(000)		US$(000)		US$(000)

Management expenses		18,108		19,938		17,480
Community development expenses and external affairs		6,297		15,653		46,482
Other		1,920		2,671		3,102

		26,325		38,262		67,064

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

F-141

~~(dollars in thousands unless otherwise stated)~~Notes to the consolidated financial statements (continued)

19.

~~COMMITMENTS AND CONTINGENCIES~~Finance costs

~~Income~~Financial costs for the years ended December 31, 2015, 2014 and ~~Mining Tax Contingencies~~

~~Income~~2013 are mainly related to the unwinding of the discount of the reclamation and ~~mining tax contingencies are provided for under ASC guidance (see Notes 2~~mine closure liability amounting to US$22,075,000, US$22,914,000 and 5)US$18,113,000, respectively. See note 12(b).

20.

Commitments and contingencies

Unitization of ~~Properties~~

properties -

In December 2000, as a result of the unitization plan carried out by the Partners, the Company signed several asset transfer and mining lease agreements with related entities. The main conditions are:

·-

The Company must pay to Chaupiloma, 3% of the quarterly net sales, according to the lease agreement. The mining rights subject to this 3% royalty are those identified in the lease agreement as part of the “Area of Influence of Chaupiloma”. Some of these mining rights are in exploitation and the rest of them in exploration.

·-

The Company must pay to S.M.R.L. Coshuro (“Coshuro”) and Buenaventura, 3% of the quarterly net sales, according to the transfer agreement. The mining rights subject to this 3% royalty are those identified in the transfer agreement, and are located out of the “Area of Influence of Chaupiloma” and within the “Area of Influence of the Joint Venture”. These mining rights are currently under exploration.

·-

The Company must pay to Los Tapados S.A., 3% of the quarterly net sales proceeds of mineral extracted from the transferred and leased concessions of Los Tapados S.A. The transferred and leased concessions of Los Tapados S.A. are also subject to a previously existing royalty on the minerals. These mining rights are currently under exploration.

~~Legal Proceedings~~

~~Choropampa (mercury spill)~~

In June 2000, a transport contractor of Yanacocha spilled approximately 151 kilograms of elemental mercury near the town of Choropampa, Peru, which is located 53 miles (85 kilometers) southwest of the Yanacocha mine. Elemental mercury is not used in Yanacocha’s operations but is a by-product of gold mining and was sold to a Lima firm for use in medical instruments and industrial applications. A comprehensive health and environmental remediation program was undertaken by Yanacocha in response to the incident. In August 2000, Yanacocha paid under protest a fine of 1,740,000 Peruvian soles (approximately $0.5) to the Peruvian government. Yanacocha has entered into settlement agreements with a number of individuals impacted by the incident. As compensation for the disruption and inconvenience caused by the incident, Yanacocha entered into agreements with and provided a variety of public works in the three communities impacted by this incident. Yanacocha cannot predict the likelihood of additional expenditures related to this matter.

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~

Additional lawsuits relating to the Choropampa incident were filed against Yanacocha in the local courts of Cajamarca, Peru, in May 2002 by over 900 Peruvian citizens. A significant number of the plaintiffs in these lawsuits entered into settlement agreements with Yanacocha prior to filing such claims. In April 2008, the Peruvian Supreme Court upheld the validity of these settlement agreements, which the Company expects to result in the dismissal of all claims brought by previously settled plaintiffs. Yanacocha has also entered into settlement agreements with approximately 350 additional plaintiffs. The claims asserted by approximately 200 plaintiffs remain. In 2011, Yanacocha was served with 22 complaints alleging grounds to nullify the settlements entered between Yanacocha and the plaintiffs. Yanacocha has answered the complaints and will continue to vigorously defend its position. Neither the Company nor Yanacocha can reasonably estimate the ultimate loss relating to such claims.

Since December 2010 to date, 23 new claims involving 29 plaintiffs were received by Yanacocha. In this claim, plaintiffs are requesting the Judge to (i) declare void the compensation agreement signed with Yanacocha and to (ii) award them with new compensation amounts. 2 of these new claims involving 2 plaintiffs were dismissed as they did not comply with formal requirements.

In 19 of these cases, the initial presiding judge admitted a motion to dismiss based on prescription of the actions and dismissing the processes. Plaintiffs appealed this decision, and Superior Court confirmed it in 18 cases. In 8 of these cases, plaintiffs have challenged this decision in front of the Supreme Court, but to date one of them has already been dismissed.

In one of the claims, a different presiding judge accepted the Company’s motion to dismiss the claim regarding a new award but it has rejected it regarding the compensation agreement, this decision was confirmed by Superior Court, so this claim continues in first instance.

~~Both request (i) and (ii) were prescribed according to the terms in Peruvian legislation, so those claims should be dismissed.~~

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~

~~Baños del Inca~~

In September 2006, the Municipality of Baños del Inca issued a declaration designating an area that includes the Carachugo Expansion and San José Projects as reserved and protected areas. Based on previous experience and actions taken by the Constitutional Tribunal (Peru Court of Last instance for Constitutional issues) in respect of Cerro Quilish in which it was ruled that such declaration did not affect the Company’s mining rights, the Company believes that Baños del Inca’s declaration, should not impact the Company’s legal rights to exploit these concessions.

In March 2008, the company filed an Action for Constitutional Relief (Amparo) against the Municipality of Baños del Inca seeking that the referred ordinance be declared inapplicable. The Court of first instance of Lima rejected the claim lodged by the Municipality of Baños del Inca regarding the jurisdiction of such court to hear this case. On March 14, 2011 the Court of first instance of Lima served the ruling it had issued declaring the complaint inadmissible. The judgment was appealed by Yanacocha. By a resolution served on August 15, 2011, the first Civil Courtroom of the Superior Court of Lima declared void the judgment of first instance, ordering the Judge to issue a new ruling. On September 07, 2012 Yanacocha request to the Civil Courtroom decides to issue a judgment due to its constitutional rights is seriously threat by the Municipality of Baños del Inca. The action is pending new judgment to be issued by the Court of first instance with no judgment as of date.

~~San Pablo~~

In February 2007 the Municipality of San Pablo issued an Ordinance declaring Las Lagunas and Pozo Seco, where the company holds concession rights, as reserved and protected areas. According to past experience and actions taken by the Constitutional Court with regard to Cerro Quilish, where it was ruled that such declaration did not affect the company’s mining rights, the Company believes that it this case, the declaration issued by the Municipality of San Pablo should not impact the legal rights it has to exploit these concessions. The company filed an Action for Constitutional Relief (Amparo) challenging the Ordinance on the grounds that, under Peruvian law, local governments are not empowered to create such areas, denying the rights granted by the Peruvian mining concessions. The Court of first instance rejected the complaint on grounds of form. Thus, the corresponding appeal was lodged.

On November 19, 2008 the second Civil Courtroom of the Superior Court of Lima confirmed the first instance ruling rejecting the action for relief, which led to the filing of an extraordinary appeal with the Constitutional Court.

By a ruling dated December 10, 2010 the Constitutional Court revoked the resolution issued by the second Civil Courtroom of the Superior Court of Lima and ordered that the complaint be admitted for processing.

By resolution served on March 25, 2011, the Court of First Instance admitted the complaint for processing and that it is served to the Provincial Municipality of San Pablo. The Municipality of San Pablo answered the complaint asserting the expiration of the statute of limitations of the action for relief. Yanacocha has requested the rejection of the expiration of the statute of limitations asserted on the grounds that the complaint for constitutional relief was timely filed.

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~

On October 31, 2012 the defendant formulates allegation and presents new evidentiary. By resolution served on December 10, 2012, the Courts resolve to confirm the Resolution N°26 which declares unfunded the exception of prescription of the case. The Court ruling on the statute of limitations is pending.

~~Conga Project~~

Regional Ordinance No. 036-2011-GR.CAJ-CR dated December 5, 2011 issued by the Regional Government of Cajamarca (hereinafter the Regional Ordinance) was published in the Official Gazette “El Peruano” on December 28, 2011.

The Regional Ordinance, among other things, declares the unworkability of the implementation of the Conga Project in the headwaters of the basin where the following lakes are found: el Perol (District of Sorochuco); Azul and Cortada (District of Huasmín); Mamacocha (District of Bambamarca) and all those located in the area of influence of the Conga Project on the grounds of the existence of technical - legal inconsistencies in the Environmental Impact Assessment approved by Directorial Resolution No.351 - 2010 - MEM/AAM, dated October 27, 2010, and also on the grounds that it contravenes constitutional norms and international treaties. Furthermore, it declares the invalidity of any legal rule that contravenes the referred Regional Ordinance.

There is Constitutional Court jurisprudence establishing that large scale mining projects fall under the exclusive jurisdiction of the Executive Power, not of the Regional Governments or Municipalities. The Attorney General filled an unconstitutionality action with the Constitutional Court seeking that this regional ordinance be declared unconstitutional and void. The complaint has already been admitted for processing by the Constitutional Court.

On April 17, 2012, Constitutional Court granted the action brought by Attorney General and declared unconstitutional the Regional Ordinance. This final ruling was published in the Official Gazette “El Peruano” on April 27, 2012.

At the same time, Yanacocha initiated an action for constitutional relief to declare the inapplicability of Regional Ordinance No. 036-2011-GR.CAJ-CR. As the ruling by Constitutional Court declared unconstitutional the Regional Ordinance, this action is no longer needed.

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~

~~Action for Constitutional Relief against Conga Project Exploitation~~

On October 19, 2012, Marco Antonio Arana Zegarra initiated an action for constitutional relief against the Mines and Energy Ministry and Yanacocha requesting that Court orders to cease any threats of violation to live in an adequate and balanced environment; so that Court declare the suspension of the exploitation of Conga Project and avoid Directorial Resolution No. 351-2010-MEM/AM dated on October 27, 2010 that approved Conga Environmental Impact As~~sessment.~~

By Court resolution No. 1 dated on October 23, 2012 the action was dismissed. On November 5, 2012, resolution No. 1 was appealed by plaintiff and the hearing at Superior Court will be held on March 4, 2013 at 12:15 p.m.

~~Clínica International, Adecco, SGC Security~~

Employees belonging to three contractors (Clinica International, Adecco, SCG Seguridad) have filed legal actions claiming to be included in Minera Yanacocha’s payroll. These workers claim that for all practical effects they are employees of the Company and therefore are entitled to all the rights attached thereto, arguing that they receive direct orders from Yanacocha and that most of the infrastructure and equipment used in the performance of their duties is also provided by the Company. All of these proceedings involve a total of 97 workers. The cases are detail as follow:

Regarding to Adecco employees, the complaint included 77 plaintiffs. This complaint was declared groundless in the first instance and confirmed by the Civil Courtroom. Thus, the plaintiffs filed an appeal for reversal. As of February 2013, the records were forwarded to the Standing Constitutional and Social Courtroom of the Supreme Court of Justice of the Republic, but complaint was not accepted. Also during this time some of the plaintiffs desisted from the claim, so to date this complaint is finished, as no plaintiffs is remaining in the process.

Regarding to Clinica International employees, the complaint included 14 plaintiffs. In cases: 254-2008 and 253-2008 are pending the issuance of judgment in the first instance, since the Civil Courtroom declared the previous judgment null, on the grounds that the judge made a mistake by having unduly matched the terms material resources and own equipment, since the former is one of the requirements for the valid existence of outsourcing, and the latter is a contributory element, as provided in Article 4 of Supreme Decree No. 003-2002-TR, amended by Supreme Decree No. 020-2007-TR. Case File No. 255 - 2008 also is pending judgment in the first instance.

In the case of SGC Security workers, the complaint included 6 plaintiffs. The issuance of judgment in the first instance is pending, since the previous judgment was declared null by the Civil Courtroom.

~~MINERA YANACOCHA S.R.L.~~

~~NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS~~

~~(dollars in thousands unless otherwise stated)~~

Letters of Guarantee

~~On January 17, 2010, the~~The Company has signed ~~a Letter~~Letters of Guarantee ~~of US$85 million~~ with ~~Banco de Credito del Peru (BCP)~~various financial institutions in accordance with the Mine Closure Regulation approved by Supreme Decree No.033-2005 of ~~The~~the Ministry of Energy and Mines. ~~This letter~~The table below sets out the outstanding signed commitments at year ends by financial institution. In general, these letters of guarantee has a renewal for one more year since January 18, 2012. For the period 2013 the letter has an amount of US$105.9 million and shall have an effective term of one additional year extended to January 18^th~~, 2014.~~are renewed annually.

~~On January 13, 2012, the Company signed an additional letter of guarantee for US$45 million with BBVA Continental which have extended to January 18~~^th, 2013 in accordance with the Mine Closure Regulations. This letter of guarantee has a renewal for US$71.7 million for the period 2013 and shall have an effective term of one additional year extended to January 18^th~~, 2014.~~

On January 18, 2013, the Company signed an additional letter of guarantee for US$30 million with Interbank which have extended to January 18th, 2014, in accordance with the Mine Closure Regulations.

	2015		2014
	US$(000)		US$(000)

Banco de Credito del Peru		150,000		150,000
BBVA Continental		100,068		100,000
Scotiabank		100,000		19,000
Interbank		-		15,300

		350,068		284,300

These ~~three~~four letters of guarantee shall come into force if the Company fails to execute in whole or in part the ~~Mine Closure Plan.~~mine closure plan.

~~Dictamen de los auditores independientes (continuación)~~

F-142

Notes to the consolidated financial statements (continued)

Legal proceedings -

Mercury spill in Choropampa

Action for Constitutional Relief against Conga Project Exploitation

On October 19, 2012, Marco Antonio Arana Zegarra ("Marco Arana") initiated an action for constitutional relief against the Mines and Energy Ministry and Yanacocha requesting that the Court orders to cease any threats of violation to life in an adequate and balanced environment; so that Court declared the suspension of the exploitation of the Conga Project and avoid Directorial Resolution No.351-2010-MEM/AM dated on October 27, 2010 that approved the Conga Environmental Impact Assessment.

Environmental

During 2015, the Company received administrative notifications from two national supervisory entities of mining investments (“OSINERGMIN”) and environmental impact (“OEFA”). The notifications are related to administrative infractions of security and environmental standards and others. According to Law N° 30230 approved on July 11^th, 2014, OEFA will notimposeadministrative fines for a period of 3 years, unless 3 exceptions: (i) serious infraction; (ii) operate without a license or in forbidden place; and (iii) recidivism. The administrative fines amounted are between a range of 1 tax impositive unit (”UIT”) to 10,000 UIT (equivalent of US$1,000 and US$11,573,000).Management's and its legal counsel’s opinion, the Company should get a favorable outcome.Based on the accounting policy, Management has not recorded a provision for this contingency.

Open tax years -

The Tax Authority has the right to examine, and, if necessary, amend the Company’s income tax provision for the last four years. The Company’s income tax returns for the years 2011 through 2015 are open to examination by the tax authorities. For years 2002 through 2007, the Company is in the claim and appeal process. The tax administration is completing the audit of income tax of the year 2011.

F-143

Notes to the consolidated financial statements (continued)

In Management’s and legal advisors’ opinion, there are sound legal grounds to sustain the Company’s tax positions; as a result, Management expects to obtain favorable results on these processes and any additional tax assessment would not be significant to the consolidated financial statements.

For the periods pending of examination, due to the many possible interpretations of current legislation, it is not possible to determine whether or not future reviews will result in tax liabilities for the Company. In the event that additional taxes are payable, including interest and surcharges, as a result of the Tax Authority reviews, they will be charged to expense in the period assessed. However, in Management’s and legal advisors’ opinion, any additional tax assessment would not be significant to the consolidated financial statements.

Tax contingencies -

Withholding income tax for fiscal years 2002 and 2003

The Tax Administration challenged the withholding tax rate applied on the technical assistance services provided by a non-resident supplier. The services were executed in Peru and also abroad; however, the Company was not able to prove that during the tax audit. Based on that, the Tax Administration considers that the services were wholly executed in Peru; therefore, the withholding tax rate should be 30% instead of 12%. The amount of the contingency involved is S/ 12.4 million (US$ 3.6 million). In Management's and its legal counsel’s opinion, that consideration has no support and the Company should obtain a favorable outcome in the appeal initiated against the tax authorities.

Health Contributions - ESSALUD

The Tax Administration considers that the bonus for closing the collective agreement and the collateral benefits granted to the unionized and non-unionized employees qualify as remunerative concepts; hence, taxed with the contribution to ESSALUD. The contingency amounts to S/ 6.5 million (US$ 2 million).In Management's and its legal counsel’s opinion, that interpretation has no support and the Company should obtain a favorable outcome in the appeal initiated against the tax authorities.

F-144

Notes to the consolidated financial statements (continued)

21.

Transactions with related parties

(a)

The main transactions carried out by the Company with its related parties in the years 2015, 2014 and 2013 were:

	2015		2014		2013
	US$(000)		US$(000)		US$(000)

Royalties paid:
S.M.R.L. Chaupiloma Dos de Cajamarca, note 1(a)		32,414		36,867		44,167

Services rendered by:
Newmont Peru S.R.L. (management services)		24,644		35,974		52,994
Newmont USA Limited		9,076		6,192		14,458

(b)

As a result of the transactions indicated in the paragraph (a), the Company had the following accounts receivable and payable from/to associates:

��

	2015		2014
	US$(000)		US$(000)

Balance receivable from related parties
Newmont USA Limited		80		27,397
Newmont Mining Services Pty Ltd		77		612
Newmont Peru S.R.L.		68		70
Newmont Technologies Limited		23		3,653
Newmont International Service Limited		-		3,503
Battle Mountain Gold Company		-		347
Newmont Global Employ Limited		-		235
Others		-		200

		248		36,017

Balance payable for related parties
S.M.R Chaupiloma Dos de Cajamarca		7,214		11,911
Newmont USA Limited		1,769		28,840
Newmont Peru S.R.L.		1,183		1,696
Newmont Technologies Limited		715		4,013
Newmont International Service Limited		77		3,485
Newmont Mining Services Pty Ltd		-		589
Others		14		537

		10,972		51,071

AII the balances above are of current maturity, have no specific guarantees and are not interest bearing.

F-145

Notes to the consolidated financial statements (continued)

22.

Financial - risk management objectives and policies

The Company's operations are exposed to certain financial risks: some market risks (foreign exchange risk, interest rate risk and price risk), credit risk and liquidity risk. The Company's overall risk management program focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the Company's financial performance. The most important aspects in risk management are the following:

(a)

Market risks -

(i)

Foreign exchange risk -

Foreign exchange risk exposure arises from exchange rate fluctuations of balances denominated in different currencies than the U.S. dollar. Since transactions and balances denominated in foreign currency are not significant, the current exchange rate risk exposure is limited. Management has decided to assume the exchange risk exposure with the results of the Company's operations; therefore it has not engaged in hedging activities.

(ii)

Interest rate risk -

The Company does not maintain significant interest-bearing assets or liabilities; therefore, operating income and cash flows of the Company are substantially independent from the changes in market interest rates. At December 31, 2015, the Company recognized interest income of approximately US$673,000 in connection with time deposits in financial institutions (US$499,000 in 2014 and US$489,000 in 2013).

(iii)

Price risk -

The Company's financial instruments exposed to price risk are limited to its trade accounts receivable (exposed to gold price) and its available-for-sale financial assets, none of which show a material balance at the end of year, therefore no significant impact on the consolidated financial statements has arisen due to changes in their price that would need to be disclosed.

(b)

Credit risk -

Credit risk is managed on a group basis by Newmont according to its policies. Financial instruments exposed to credit risk are cash and cash equivalents, investments in debt and equity instruments, trade accounts receivable and other accounts receivable. For banks and financial institutions, only independently rated parties with a minimum "A" rating are accepted. Regarding trade accounts receivable, according to the practice in the latest years, collections have generally been at full. A credit review of the portfolio is performed quarterly to determine any deterioration in credit quality. The Company does not foresee any significant losses that may arise from this risk.

(c)

Liquidity risk -

Management administrates its exposure to liquidity risk through financing from internal operations, Company's partners and maintaining good relationships with local and foreign banks in order to maintain adequate levels of credit available. The Company currently has no existing bank lines of credit.

F-146

Notes to the consolidated financial statements (continued)

The following table represents the analysis of the Company's financial liabilities, including estimated projected interests relating to financial obligations, considering the remaining period to reach such maturity as of the consolidated statement of financial position date:

	2015		2014
	Less than 1 year		Less than 1 year
	US$(000)		US$(000)

Trade accounts payable		56,447		69,788
Accounts payable to related parties		10,792		51,071
Remuneration and similar benefits payable		8,981		13,390

		76,220		134,249

(d)

Capital risk management -

The Company's objectives for managing capital are to safeguard the Company's ability to continue as a going concern in order to provide expected returns for partners and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the Company may adjust the amount of dividends paid to its partners. No formal dividend policy exists.

(e)

Fair value estimation -

Fair value accounting establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).

As required by accounting guidance, assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. The Company's assets that are measured at fair value on a recurring basis (at least annually) correspond to the San José Reservoir Trust assets.

The Company's San José Reservoir Trust assets are made up of marketable equity and debt securities that are valued using quoted market prices in active markets and as such are classified within Level 1 of the fair value hierarchy. The fair value of the marketable equity securities is calculated as the quoted market price of the marketable equity security multiplied by the quantity of shares held by the Company.

The Company's impairment loss is valued using valuation techniques to determine the WACC rate. These valuation techniques maximize the use of observable market data where it is available and rely as little as possible on entity specific estimates as such is classified within Level 2 of the fair value hierarchy.

F-147

Notes to the consolidated financial statements (continued)

23.

Subsequent events

On February 15, 2016, The Committee agreed unanimously on a distribution of a dividend to the partners in proportion to their social participation US$300,000,000 that corresponds to a part of unrestricted accumulated earnings as of December 31, 2014, which had been generated in the year 2011.

24.

Summary of significant differences between accounting principlesfollowed by the Company and U.S. Generally Accepted Accounting Principles

The Company's financial statements have been prepared in accordance with International Financial Reporting Standards which differs in certain respects from U.S. GAAP. The effects of these differences are reflected in note 25 and are principally related to the items discussed in the following paragraphs:

(a)

Impairment -

Under IFRS, the Company estimates the recoverable amount of an asset whenever there is an indication that the asset may be impaired. The recoverable amount is the higher of the fair value less costs of disposal and its value in use. Value in use is the present value of the future cash flows expected to be derived from an asset or cash-generating unit.

In 2015, no impairment loss resulted for Yanacocha and Conga cash-generating units. In 2014, the Company recorded impairment losses amounting to US$541 million related to Conga, and no amount for Yanacocha (US$1,038 million for the year ended December 31, 2013: US$453 million related to Yanacocha and US$585 million related to Conga).

Under US GAAP, the Company used undiscounted cash flows to perform an impairment evaluation. No impairment losses resulted for Yanacocha and Conga cash-generating units in years 2013, 2014 and 2015.

For reconciling the net income/loss and net equity from IFRS to US GAAP, the Company eliminates the impairment loss and records the depreciation corresponding to the impaired assets under IFRS.

(b)

Deferred workers’ profit participation

Under IFRS, the workers’ profit participation is calculated based on the Company’s taxable income and is recorded as an employee benefit (cost of production or administrative expense, depending on the function of the workers).

Under US GAAP, the workers’ profit sharing is treated in a similar way as income tax since both are calculated based on the Company’s taxable income. Therefore, the Company calculates a deferred workers’ profit participation resulting from the taxable and deductible temporary differences.

For reconciling the net income/loss and net equity from IFRS to US GAAP, the Company recognizes a deferred workers’ profit participation and the corresponding valuation allowance recorded in the year.

F-148

Notes to the consolidated financial statements (continued)

(c)

Stripping activity asset -

Under IFRS, the stripping costs in the production phase of a surface mine are accounted for according to the accounting principle disclosed in note 2.

Under U.S. GAAP, the costs of clearing removal (stripping cost of production) incurred during the production stage are recorded as part of the production cost of inventories.

(d)

Reclamation and mine closure –

Under IFRS, the liability was measured in accordance with IAS 37 and IFRIC 1. Upward and downward revisions in the amount of undiscounted estimated cash flows are discounted using the current market-based discount rate (this includes changes in the time value of money and the risks specific to the liability), see note 2.4 (j).

Under U.S. GAAP, upward revisions in the amount of undiscounted estimated cash flows are discounted using the current credit-adjusted risk-free rate. Downward revisions in the amount of undiscounted estimated cash flows are discounted using the credit-adjusted risk-free rate that existed when the original liability was recognized.

(e)

Inventories -

Under IFRS, the cost of inventory mainly includes less depreciation as a result of the reduced base of property, plant and equipment due to the impairment recorded in prior years.

Under U.S. GAAP, the cost of inventory considers a higher depreciation since the items of property, plant and equipment have not been impaired.

(f)

Deferred income tax –

The differences between U.S. GAAP and IFRS are re-measurements that lead to different temporary differences. According to the accounting policies in note 2.4 (l), the Company has to account for such differences.

During 2015, the Company recorded a valuation allowance of the deferred income tax asset recorded under IFRS which was higher by US$321,622,000 compared to the valuation allowance recorded under U.S. GAAP, mainly as a result of the impairment losses of prior years recorded under IFRS.

F-149

Notes to the consolidated financial statements (continued)

25.

Reconciliation between net income and Partners' Equity determined under IFRS and U.S. GAAP

The following is a summary of the adjustment to net income for the years ended December 31, 2015, 2014 and 2013 and to partners' equity as of December 31, 2015 and 2014 that would be required if U.S. GAAP had been applied instead of IFRS in the consolidated financial statements:

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

(Loss) income under U.S. GAAP		(252,159	)		(31,914	)		140,997

Items increasing (decreasing) reported net profit:
Impairment loss, note 24 (a)		-			541,141			1,038,548
Depreciation of assets impaired under IFRS, note 24 (a)		(125,943	)		(79,809	)		-
Elimination of the valuation allowance of the deferred workers’ profit participation, note 24 (b)		(41,909	)		-			-
Stripping activity asset, note 24 (c)		(18,868	)		(23,212	)		(33,861	)
Reclamation and mine closure, note 24 (d)		(12,049	)		427			(10,690	)
Inventories, note 24 (e)		20,903			(17,428	)		12,042
Deferred workers' profit participation, note 24 (b)		2,790			29,003			28,443
Elimination of valuation allowance of deferred income tax, note 24 (f)		321,622			-			-
Deferred income tax of reconciliation items, note 24 (f)		43,441			(93,062	)		(306,994	)
Others		8,049			11,364			(11,212	)

Loss under IFRS		(450,195	)		(400,338	)		(575,279	)

F-150

Notes to the consolidated financial statements (continued)

	2015			2014
	US$(000)			US$(000)

Partners' equity under IFRS		2,228,825			2,679,777

Items increasing (decreasing) reported Partners' equity:
Impairment loss, note 24 (a)		1,579,689			1,579,689
Depreciation of assets impaired under IFRS, note 24 (a)		(278,333	)		(152,390	)
Elimination of the valuation allowance of the deferred workers’ profit participation, note 24 (b)		(41,909	)		-
Stripping activity asset, note 24 (c)		(18,913	)		(45	)
Reclamation and mine closure, note 24 (d)		(99,102	)		(87,053	)
Inventories, note 24 (e)		(5,787	)		(26,690	)
Deferred workers' profit participation, note 24 (b)		40,935			38,145
Elimination of valuation allowance of deferred income tax, note 24 (f)		321,622			-
Deferred income tax related to reconciliation items, note 24 (f)		(310,341	)		(353,782	)
Others		2,303			(6,503	)

Partners' equity under U.S. GAAP		3,418,989			3,671,148

26.

New U.S. GAAP Accounting Pronouncements

Recently Issued Accounting Pronouncements -

Inventory -

In July 2015, ASU guidance was issued related to inventory simplifying the subsequent measurement of inventories by replacing the lower of cost or market test with a lower of cost and net realizable value test. The update is effective in fiscal years, including interim periods, beginning after December 15, 2016, and early adoption is permitted. The Company is currently evaluating this guidance and the impact it will have on net equity or net results.

Revenue recognition –

In May 2014, ASU guidance was issued related to revenue from contracts with customers. The new standard provides a five-step approach to be applied to all contracts with customers and also requires expanded disclosures about revenue recognition. In August 2015, the effective date was deferred to reporting periods, including interim periods, beginning after December 15, 2017, and will be applied retrospectively. Early adoption is not permitted. The Company is currently evaluating this guidance and the impact it will have on net equity or net results.

F-151

Sociedad Minera Cerro Verde S.A.A.

Financial Statements ~~as of December 31, 2012, 2011~~for the years 2015, 2014 and ~~2010,~~ 2013
together with the Report of Independent Registered Public Accounting Firm

F-152

~~Contents~~

Sociedad Minera Cerro Verde S.A.A.

Financial Statements for the years 2015, 2014 and 2013

together with the Report of Independent Registered Public

Accounting Firm

Content

Report of Independent Registered Public Accounting Firm	~~F-145~~F-153

~~Statement of~~ Financial ~~Position~~	~~F-146~~
Statements
Statement of financial position	F-154
Statements of ~~Comprehensive Income~~comprehensive income	~~F-147~~F-155
Statements of changes in equity	F-156
Statements of cash flows	F-157
Notes to the financial statements	F-159


~~Statements of Changes in Equity~~	~~F-148~~
F-153
~~Statements of Cash Flows~~	~~F-149~~

~~Notes to the Financial Statements~~	~~F-151~~

Report of Independent Registered Public Accounting Firm

~~ERNST & YOUNG~~	~~Medina, Zaldivar, Paredes~~
	~~& Asociados Sociedad Civil~~

To the Board of Directors and Shareholders of Sociedad Minera Cerro Verde S.A.A.

We have audited the accompanying financial statements of Sociedad Minera Cerro Verde S.A.A. (a Peruvian company, subsidiary of Freeport-McMoRan ~~Copper & Gold~~ Inc.), which comprise the ~~statement~~statements of financial position as of December 31, ~~2012~~2015 and ~~2011,~~2014, and the related statements of comprehensive income, statements of changes in equity and statements of cash flows for ~~each of~~ the ~~three~~ years ended December 31, ~~2012, 2011~~2015, 2014 and ~~2010.~~2013. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the ~~Company’s~~Company´s internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis of designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the ~~Company’s~~Company´s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Sociedad Minera Cerro Verde ~~S.A.A~~.S.A.A. as of December 31, ~~2012~~2015 and ~~2011,~~2014, and the results of operations and its cash flows for each of the three years ended December 31, ~~2012, 2011~~2015, 2014 and ~~2010,~~2013, in ~~conformity~~accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (“IASB”) which differ in certain respects from the accounting principles generally accepted in the United States of America (see note 29 to the financial statements).

Lima, Peru,

~~April 30, 2013~~

February 25, 2016

~~/s/ Medina, Zaldivar, Paredes & Asociados~~

~~Countersigned by:~~

~~/s/ Marco Antonio Zaldívar~~__

~~Marco Antonio Zaldívar~~

Countersigned by:

Paredes, Zaldívar, Burga & Asociados S. Civil de R.L.

/s/ Victor Burga
Víctor Burga

C.P.C.C. Register ~~No.12477~~

No.14859

~~F-145~~

F-154

Sociedad Minera Cerro Verde S.A.A.

~~Statement~~Statements of ~~Financial Position~~financial position

As of December 31, ~~2012~~2015 and ~~2011~~2014

	Note	2012		2011		Note	2015		2014
		US$(000)		US$(000)			US$(000)		US$(000)
Assets
Current assets
Cash and cash equivalents	3		1,427,528		1,383,636	5(a)		5,952		19,574
Trade accounts receivable	4		4,054		44,053	6		13,948		2,374
Trade accounts receivable from related parties	17(f)		318,562		199,331	22(g)		199,368		187,940
Embedded derivative	19		11,569		-
Other accounts receivable			28,408		25,959			10,091		10,146
Inventories, net	6		194,909		175,837
Non-financial assets						7(a)		432,299		225,076
Inventories						8(a)		394,867		232,542
								1,056,525		677,652
Total current assets			1,985,030		1,828,816
Other long – term accounts receivable	5		63,964		-
Non-current assets
Long-term non-financial assets						7(a)		382,002		253,184
Long-term inventories	6		188,990		140,671	8(a)		319,971		287,714
Property, plant and equipment, net	7		1,799,709		1,220,591	9(a)		6,077,289		4,544,406
Intangible assets, net	16(d)		5,078		6,519			16,905		9,028
								6,796,167		5,094,332
Total assets			4,042,771		3,196,597			7,852,692		5,771,984

Liabilities and equity, net
Current liabilities
Trade accounts payable	8		146,354		55,950	10		432,418		398,070
Trade accounts payable to related parties	17(f)		8,081		3,415
Accounts payable to related parties						22(g)		12,042		11,910
Embedded derivative	19		-		75,257	24		18,847		26,782
Income tax liability			21,187		56,920
Workers’ profit sharing payable	9		75,991		119,711
Income tax payable								4,731		15,492
Employees benefits liability						11(a)		20,536		44,412
Other financial liabilities						12(a)		43,169		50,163
Other provisions						13(a)		14,662		2,964
Other accounts payable			20,855		24,675			2,112		2,779
								548,517		552,572
Total current liabilities			272,468		335,928
Non-current portion of other accounts payable			540		1,298
Provision for remediation and mine closure	16(a)		79,812		7,061
Deferred income tax liability	10(a)		240,243		174,672
Non-current liabilities
Other financial liabilities						12(a)		2,381,995		402,686
Accounts payable to related parties						22(g)		6,850		5,643
Other provisions						13(a)		163,803		125,265
Deferred income tax liability, net						14(a)		253,153		220,728
								2,805,801		754,322
Total liabilities			593,063		518,959

Total liability								3,354,318		1,306,894
Equity, net	11					15
Issued capital			990,659		990,659			990,659		990,659
Other capital reserves			198,132		198,132			198,132		198,132
Retained earnings			2,260,917		1,488,847			3,309,583		3,276,299

Total equity, net			3,449,708		2,677,638			4,498,374		4,465,090

Total liabilities and equity, net			4,042,771		3,196,597			7,852,692		5,771,984

The accompanying notes are an integral part of this financial statement.

~~F-146~~

F-155

Sociedad Minera Cerro Verde S.A.A.

Statements of ~~Comprehensive Income~~comprehensive income

For the years ended December 31, ~~2012, 2011~~2015, 2014 and ~~2010~~2013

	Note	2012			2011			2010			Note	2015			2014			2013
		US$(000)			US$(000)			US$(000)				US$(000)			US$(000)			US$(000)

Sales of goods	13		2,127,023			2,520,050			2,368,988		17(a)		1,115,617			1,467,097			1,811,488

Cost of sales of goods	14		(801,571	)		(824,700	)		(645,959	)	18		(862,004	)		(797,481	)		(795,064	)

Gross profit			1,325,452			1,695,350			1,723,029				253,613			669,616			1,016,424

Operating expenses
Selling expenses	15		(78,674	)		(83,612	)		(76,638	)	19		(56,215	)		(54,210	)		(68,448	)
Expense related to water plant	16(b)		(19,606	)		(13,670	)		(4,300	)
Excess of workers’ profit sharing	9(b)		-			(21,923	)		(34,427	)
Voluntary contribution	16(e)		-			-			(41,081	)
Other operating expenses			(9,898	)		(16,865	)		(10,749	)

Other operating income (expenses), net											20		(26,600	)		(3,629	)		147
			(108,178	)		(136,070	)		(167,195	)
													(82,815	)		(57,839	)		(68,301	)
Operating profit			1,217,274			1,559,280			1,555,834				170,798			611,777			948,123

Other income (expenses)
Financial income			1,886			1,078			1,261
Financial expenses			(6,951	)		(165	)		(101	)
Gain net from exchange differences	20(a)		3,149			1,924			669
Finance income													512			2,443			2,178
Finance costs													(16,010	)		(369	)		(1,843	)
Net gain (loss) from exchange differences											25(a)		(75,770	)		2,284			(1,858	)
													(91,268	)		4,358			(1,523	)

Profit before income tax			1,215,358			1,562,117			1,557,663				79,530			616,135			946,600

Income tax expense	10(c, d)		(443,288	)		(483,718	)		(483,270	)	14(b,c)		(46,246	)		(238,529	)		(333,338	)

Profit for the year			772,070			1,078,399			1,074,393				33,284			377,606			613,262

Basic and diluted earnings per share (stated in US dollars)	18		2.21			3.08			3.07		23		0.10			1.08			1.75

Weighted average number of shares outstanding	18		350,056,012			350,056,012			350,056,012

The accompanying notes are an integral part of this financial statement.

F-156

Sociedad Minera Cerro Verde S.A.A.

Statements of ~~Changes~~changes in ~~Equity~~equity

For the years ended December 31, ~~2012, 2011~~2015, 2014 and ~~2010~~2013

Issued
capital Other capital
reserves Retained
earnings Total
US$(000) US$(000) US$(000) US$(000)

Balance as of January 1, 2010 990,659 198,132 286,055 1,474,846

Profit for the year - - 1,074,393 1,074,393
Dividend distribution, note 11(d) - - (950,000 ) (950,000 )

Balance as of December 31, 2010 990,659 198,132 410,448 1,599,239

Profit for the year - - 1,078,399 1,078,399

Balance as of December 31, 2011 990,659 198,132 1,488,847 2,677,638

Profit for the year - - 772,070 772,070

Balance as of December 31, 2012 990,659 198,132 2,260,917 3,449,708

	Note	Issued capital		Legal reserve		Retained earnings		Total
		US$(000)		US$(000)		US$(000)		US$(000)

Balance as of January 1 , 2013	15		990,659		198,132		2,285,431		3,474,222

Profit for the year			-		-		613,262		613,262
Balance as of December 31, 2013	15		990,659		198,132		2,898,693		4,087,484

Profit for the year			-		-		377,606		377,606
Balance as of December 31, 2014	15		990,659		198,132		3,276,299		4,465,090

Profit for the year			-		-		33,284		33,284

Balance as of December 31, 2015			990,659		198,132		3,309,583		4,498,374

The accompanying notes are an integral part of this financial statement.

F-157

Sociedad Minera Cerro Verde S.A.A.

Statements of ~~Cash Flows~~cash flows

For the years ended December 31, ~~2012, 2011~~2015, 2014 and ~~2010~~2013

2012 2011 2010
US$(000) US$(000) US$(000)

Operating activities
Profit before income tax 1,215,358 1,562,117 1,557,663
Adjustments to profit for the year that do not affect net cash flow from operating activities
Depreciation of property, plant and equipment 94,242 82,431 86,056
Amortization of intangible assets 1,630 1,630 1,630
Unwinding of discount provision for remediation and mine closure 239 358 180
Provision (recovery of provision) for inventory obsolescence 778 203 (525 )
Net loss from disposal/sale of property, plant and equipment 24 4,062 153
Other adjustments - - (360 )

Net changes in operating assets and liabilities accounts
Net decrease (increase) in operating assets
Trade accounts receivable 40,261 (16,460 ) (2,801 )
Trade accounts receivable from related parties (119,231 ) 91,378 (74,147 )
Embedded derivative (11,569 ) 208,474 (68,457 )
Other accounts receivable (2,449 ) 2,290 (13,508 )
Inventories (19,850 ) (5,612 ) (13,381 )
Other long-term accounts receivable (12,119 ) 19,002 30,533
Long-term inventories (48,319 ) (20,698 ) (28,941 )
Net increase (decrease) in operating liabilities
Trade accounts payable 90,404 (11,426 ) 27,578
Accounts payable to related parties 4,666 (436 ) 1,132
Embedded derivative (75,257 ) - -
Workers’ profit sharing payable (43,720 ) 9,646 61,811
Other accounts payable (3,820 ) (109,289 ) 56,542
Non-current portion of other accounts payable (758 ) - (37,106 )
Income tax paid (465,819 ) (626,925 ) (327,111 )

Net cash and cash equivalents provided by operating activities 644,691 1,190,745 1,256,941

		2015			2014			2013
		US$(000)			US$(000)			US$(000)

Operating activities
Profit before income tax			79,530			616,135			946,600
Adjustments to reconcile profit before income tax to net cash flows from operating activities:
Depreciation of property, plant and equipment	9(a)		244,477			164,985			107,620
Amortization of intangible assets			-			-			1,630
Unwinding of discount on remediation and mine closure obligations	13(b)		3,985			2,537			4,609
Provision for inventory obsolescence			-			-			1,207
Net loss (gain) from disposal/sale of property, plant and equipment			661			4,722			(541	)
Impairment of property, plant and equipment			-			781			1,809

Net changes in the accounts balances of assets and liabilities of operation:
Net decrease (increase) in operating assets:
Trade accounts receivable			(11,574	)		5,230			(3,550	)
Trade accounts receivable from related parties			(11,428	)		120,546			8,218
Other accounts receivable			55			(4,341	)		(6,314	)
Short and long-term inventories	8(a)		(194,582	)		(86,459	)		(67,942	)
Short and long-term non-financial assets			(239,595	)		(338,242	)		(48,808	)
Net increase (decrease) in operating liabilities:
Trade accounts payable			68,813			(850	)		122,154
Accounts payable to related parties			1,339			5,280			3,897
Embedded derivative			(7,935	)		42,805			(4,454	)
Employees benefits liability			(23,876	)		(13,717	)		(28,544	)
Other accounts payable and other provisions			16,711			(17,399	)		16,770
Income tax paid			(121,027	)		(315,369	)		(286,036	)

Net cash and cash equivalents (used in) provided by operating activities			(194,446	)		186,644			768,325

F-158

Statements of ~~Cash Flows~~cash flows (continued)

For the years ended December 31, 2015, 2014 and 2013

2012 2011 2010
US$(000) US$(000) US$(000)

Investing activities
Collection from the sale of property, plant and equipment 262 -
Purchase of property, plant and equipment (600,872 ) (195,222 ) (122,256 )
Purchase of intangibles (189 ) - 37

Net cash and cash equivalents used in investing activities (600,799 ) (195,222 ) (122,219 )

Financing activities
Payment of dividends - - (950,000 )

Net cash and cash equivalents used in financing activities - - (950,000 )

Net increase in cash and cash equivalents during the year 43,892 995,523 184,722
Cash and cash equivalents at beginning of year 1,383,636 388,113 203,391

Cash and cash equivalents at year-end 1,427,528 1,383,636 388,113

Transactions with no effects in cash flows:
Increase in the provision for remediation and mine closure estimate 72,512 3,217 (360 )

		2015			2014			2013
		US$(000)			US$(000)			US$(000)

Investing activities
Proceeds from sale of property, plant and equipment			409			356			694
Withdraw of time deposits			-			226,772			(225,000	)
Purchase of property, plant and equipment	9(a)		(1,663,738	)		(1,640,287	)		(1,066,267	)
Stripping activity asset	9(a)		(111,819	)		(49,122	)		(49,938	)
Purchase of intangibles			(9,509	)		(7,178	)		-
Net cash and cash equivalents used in investing activities			(1,784,657	)		(1,469,459	)		(1,340,511	)

Financing activities
Proceeds from loans	12(a)		1,896,000			475,000			-
Proceeds from related parties loans	12(d)		600,000			-			-
Payments of loans	12(a)		(528,000	)		-
Debt issuance costs			(2,356	)		(27,024	)
Payments of finance lease			(163	)		(157	)		(772	)
Net cash and cash equivalents provided by financing activities			1,965,481			447,819			(772	)

Net decrease in cash and cash equivalents in the year			(13,622	)		(834,996	)		(572,958	)

Cash and cash equivalents at beginning of year	5(a)		19,574			854,570			1,427,528

Cash and cash equivalents at end of year			5,952			19,574			854,570

Transactions with no effects in cash flows:
Provision for remediation and mine closure	9(a) and 13(b)		33,803			68,840			(36,445	)

The accompanying notes are an integral part of this financial statement

~~F-150~~

F-159

Sociedad Minera Cerro Verde S.A.A.

Notes to the ~~Financial Statements~~financial statements

As of December 31, ~~2012, 2011~~2015, 2014 and ~~2010~~2013

Identification and business activity of the Company

(a)

Identification -

Sociedad Minera Cerro Verde S.A.A. (hereinafter “the Company”) was incorporated in Peru on August 20, 1993, as a result of the privatization process of certain mining units carried out by the Peruvian State in that year. The Company has listed its shares on the Lima Stock Exchange since November 14, 2000.

Sociedad Minera Cerro Verde S.A.A. (here in after “the Company”) was incorporated in Peru on August 20, 1993, as a result of the privatization process of certain mining units carried out by the Peruvian State in that year. The Company has listed its shares on the Lima Stock Exchange since November 14, 2000.

Through its subsidiary Cyprus Climax Metals Company, ~~Freeport-McMoRan~~Freeport-Minerals Corporation (“FMC” ~~– formerly Phelps Dodge Corporation)~~), a wholly owned subsidiary of Freeport-McMoRan ~~Copper & Gold~~ Inc. (“Freeport”), owns 53.56% of the voting shares of the Company. ~~Additionally,~~ SMM Cerro Verde Netherlands B.V. (a subsidiary of Sumitomo Metal Mining Company Ltd.) owns 21% of the voting share of the Company, Compañía de Minas Buenaventura S.A.A. owns 19.58%, and the minority stakeholders own the remaining 5.86%.

The Company’s legal address is ~~Asiento~~Jacinto Ibañez Street No. 315, Parque Industrial, Arequipa City and the ore deposits are located southwest of that city (Asiento Minero Cerro Verde S/N Uchumayo – ~~Arequipa. The ore deposits are located southwest of the city of Arequipa.~~Arequipa).

(b)

Business activity -

The Company’s activities are regulated by the Peruvian General Mining Law and comprise the extraction, production and sale of copper cathodes and concentrates.

Expansion of operations

In September 2015, the expansion project commenced operations and is expected to reach full rates in early 2016.

The ~~Company is engaged in~~project, with a ~~large-scale expansion~~cost of ~~Cerro Verde´s production unit. The~~ US$~~4.4~~4.6 billion, ~~project will expand the~~expands processing capacity from 120,000 metric tons per day of ore to 360,000 metric tons per day, ~~targeting~~and targets incremental annual production of approximately 600 million pounds of copper and 15 million of ~~molybdenum beginning in 2016. In December 2012,~~molybdenum.

This expansion was financed with senior unsecured loans received by several banks lead by Citibank N.A. and with shareholders’ loans, currently subordinated to the ~~Company received approval of~~senior unsecured loans before mentioned. See Note 12.

F-160

Notes to the ~~Environmental Impact Study from the Peruvian Ministry of Energy and Mines. Detailed engineering and procurement of long-lead items are in progress. The Company expects to begin construction in 2013.~~financial statements (continued)

(c)

Financial statements approval –-
The financial statements for the year ended December 31, 2015 were approved by Company´s Management on February 25, 2016 and, in Management’s opinion, they will be approved without changes by the Board of Directors and Shareholders’ Meetings to be held in the first quarter of 2016. The financial statements for the year ended December 31, 2014 were approved by the Board of Directors and Shareholders’ Meetings on March 27, 2015.

The financial statements as of December 31, 2012 and 2011 were approved by Company´s Management on February 8, 2013 and will be presented for the approval of the Board of Directors and the Shareholders within the terms established by law. In Management’s opinion, the accompanying financial statements will be approved without changes by the Board of Directors and Shareholders’ Meetings that will be held in the first quarter of 2013.

~~F-151~~

~~Notes to the Financial Statements(continued)~~

Significant accounting principles and policies

2.1

Basis of preparation -

The financial statements of the Company have been prepared in accordance with International Financial Reporting Standards (“IFRS”), as issued by the International Accounting Standards Board (“IASB”), and interpretations issued by the IFRS Interpretations Committee (“IFRIC”).

The financial statements have been prepared based on a historical cost basis, except for accounts receivable and/or payable related to embedded derivatives ~~which~~that have been measured at fair value.

The financial statements are presented in United States ~~(“US”~~dollars (US$) ~~dollars~~ and include the years ended December 31, ~~2012, 2011~~2015, 2014 and ~~2010.~~2013. Unless otherwise indicated, all values have been rounded to the nearest thousand.

~~2.2~~

~~Accounting estimates, judgments and assumptions –~~

The preparation of the financial statements according to IFRS requires that Management make judgments, estimates and assumptions that affect the amounts of the assets and liabilities reported, the disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses for the years ended December 31, 2012, 2011 and 2010.

Estimates and assumptions are continuously evaluated and are based on the experience of Management and other factors, including expectations of future events that are reasonable under current circumstances; however, actual results could differ from these estimates.

~~Information about estimations and judgements taken into account by Management in the preparation of the financial statements follows:~~

~~(a)~~

~~Estimates of ore reserves and resources -~~

Ore reserves are estimates of the ore quantity that can be economically and legally extracted from the mine properties. The Company estimates its ore reserves based on information compiled by individuals qualified in reference to geological data about the size, depth and form of the ore body, and requires of geological judgments in order to interpret the data.

The estimation of recoverable reserves is based on factors such as estimated exchange rates, commodity prices, future requirements of capital and production costs, together with geological hypothesis and judgments made when estimating the size and quality of ore. Revisions in reserve or resource estimates may have an impact on the value of mining properties, property, plant and equipment, provisions for cost of mine closure, recognition of assets for deferred taxes and depreciation and amortization of assets.

~~Notes to the Financial Statements(continued)~~

~~(b)~~

~~Units-of-production (“UOP”) depreciation -~~

Estimates of recoverable reserves are used in determining the depreciation and amortization of mine assets. This results in a depreciation/amortization charge proportional to the depletion of the anticipated remaining life of mine production. Each item’s life, which is assessed annually, takes into account its physical life limitations and the present assessments of economically recoverable reserves. These calculations require the use of estimates and assumptions, including the amount of recoverable reserves that may be recovered.

~~(c)~~

~~Asset impairment –~~

The Company has determined that the Cerro Verde operation consists of one cash generating unit, considering the operation as a whole. Therefore, the Cerro Verde operation is evaluated annually in order to determine if there are any impairment indicators. If any such indication exists, the Company makes an estimate of the recoverable amount, which is the greater of the fair value less costs to sell and the value in use. These assessments require the use of estimates and assumptions, such as long-term commodity prices, discount rates, operating costs, and others.

Fair value is defined as the amount that would be obtained from the sale of the asset in an arm’s length transaction between willing and knowledgeable parties. The fair value of assets is generally determined as the current value of future cash flows derived from the continuous use of the asset, which includes estimates, such as the cost of future expansion plans and eventual disposal, while applying assumptions that an independent market participant may take into account. The cash flows are discounted by applying a discount rate that reflects current market, the time value of money and the risks specific to the asset.

~~(d)~~

~~Mine closure provision~~-

The Company assesses its mine closure provision annually. It is necessary to make estimates and assumptions in determining this provision, including cost estimates of activities that are necessary for the rehabilitation of the site, technological and regulatory changes, interest rates and inflation rates. As discussed in note 2.3(h), estimated changes in the fair value of the mine closure provision or the useful life of the related assets are recognized as an increase or decrease in the book value of the provision and related asset retirement cost (ARC) in accordance with IAS 16, “Property, Plant and Equipment”. If any change in the estimate results in an increase to the mine closure and related ARC, the Company shall consider whether or not this is an indicator of impairment of the assets and will apply impairment tests in accordance with IAS 36, “Impairments of Assets”.

~~Notes to the Financial Statements(continued)~~

~~(e)~~

~~Inventories -~~

Net realizable value tests are performed at least annually and represent the estimated future sales price of the product based on prevailing spot metals prices, less estimated costs to complete production and bring the inventory to sale. Additionally, in calculating the net realizable value of the Company’s long-term stockpiles, Management also considers the time value of money.

Mill and leach stockpiles generally contain lower grade ores that have been extracted from the ore body and are available for copper recovery. For mill stockpiles, recovery is through milling and concentrating. For leach stockpiles, recovery is through exposure to acidic solutions that dissolve copper and delivery it in solution to extraction processing facilities.

Because it is generally impracticable to determine copper contained in mill and leach stockpiles by physical count, reasonable estimation method are employed. The quantity of material delivered to mill and leach stockpiles is based on surveyed volumes of mined material and daily production records. Sampling and assaying of blasthole cuttings determine the estimated copper grades of material delivered to mill and leach stockpiles.

Expected copper recovery rates for mill stockpiles are determined by metallurgical sampling. The recoverability of copper in mill stockpiles, once entered into the production process, can be produced into copper concentrate almost immediately.

Estimated copper recovery rates are determined using laboratory tests, historical trends and other factors. Ultimate recovery of copper contained in leach stockpiles can vary significantly depending on several variables, including type of copper recovery, mineralogy and the size of the rocks. Processes and recovery rates are monitored continuously, and recovery rates are adjusted periodically as additional information becomes available and as related technology changes.

~~(f)~~

~~Contingencies -~~

By their nature, contingencies will only be resolved when one or more future events do or do not occur. Determining contingencies inherently involves the exercise of judgment and calculation of the estimated results of future events.

~~2.3.~~2.2.

Summary of significant accounting policies and practices -

(a)

Currency -

The financial statements are presented in US ~~dollars;~~dollars, which is ~~also~~ the Company’s functional currency.

~~Notes to the Financial Statements(continued)~~

Foreign currency transactions are ~~considered to be~~ those ~~which are~~ carried out in a currency ~~that is~~ other than the ~~function~~functional currency. Foreign currency transactions are ~~translated into~~initially recorded in the functional currency ~~by applying~~at the rate of exchange ~~rate in force on~~ruling at the date of the ~~transaction takes place.~~transaction. Monetary assets and liabilities denominated in foreign currencies are ~~converted using~~translated to the ~~functional currency~~ spot rate ~~in force~~of exchange ruling at the reporting date.

Gains and losses as a result of the difference in the exchange rate when ~~currency~~monetary items are liquidated or when converting ~~currency~~monetary items at exchange rates that are different from those used for their initial recognition are recognized in the statements of comprehensive income for the year.

The Company uses exchange rates published by the Superintendent of Banks, Insurance and ~~AFP.~~Pension Fund Administrator. As of December 31, ~~2012,~~2015, the published exchange rates were S/~~.2.594~~3.408 for US$1 for buying and S/~~.2.551~~3.413 for US$1 for selling (S/~~.2.695~~2.981 for US$1 for buying and S/~~. 2.697~~2.989 for US$1 as of December 31, ~~2011, respectively)~~2014). ~~These rates have been applied~~

F-161

Notes to the ~~appropriate asset and liability accounts. As of December 31, 2012 and 2011, the Company did not maintain significant assets or liabilities in Nuevos Soles.~~financial statements (continued)

(b)

Financial instruments: Initial recognition and subsequent measurement -

A financial instrument is any agreement which originates a financial asset of the entity and a financial liability or equity instruments of other entity.

(i)

Financial assets -

The Company determines the classification of its financial assets at initial recognition in accordance with IAS 39, “Financial Instruments: Recognition and Measurement”.

~~Financial~~All financial assets are recognized initially at fair value plus ~~the direct~~transaction costs that are attributable to the ~~transaction.~~acquisition of the financial asset. The Company’s financial assets include ~~cash and cash equivalents,~~ accounts receivable and embedded derivatives.

~~Cash and cash equivalents -~~

~~Cash and cash equivalents are financial assets that may be liquidated immediately, such as bank accounts, and other liquid investments with original maturities of three months or less.~~

Receivables -

The Company’s accounts receivables include trade accounts receivables to related parties and third parties and other accounts receivable. ~~These receivables are stated at their transaction value, net of an allowance for doubtful accounts.~~

~~Receivables~~Accounts receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. After initial measurement, the accounts receivables are subsequently carried at amortized cost using the effective interest method less any provision for impairment (i.e. allowance for doubtful accounts).

~~Notes to the Financial Statements(continued)~~

The Company assesses whether, as of the date of the financial statements, there is objective evidence of impairment in the value of the receivable. Any resulting impairment is measured as the difference between the book value of the receivable and the present value of the estimated future cash flows, discounted at an original effective interest rate or one applicable to a similar transaction. The carrying amount of the receivable is reduced by means of an allowance account and recognized in the statements of comprehensive income.

Embedded derivatives -

The Company’s copper sales are provisionally priced at the time of shipment. The provisional prices are finalized in a specified future month based on quoted London Metal Exchange (LME) monthly average prices. The Company receives market prices based on prices in the specified future month, which results in price fluctuations recorded through revenues until the date of settlement. The Company records revenues and commercial invoices at the time of shipment based on the current LME prices, which result in an embedded derivative that is required to be separated from the ~~main~~host contract.

The Company’s embedded derivatives from sales are measured at fair value (based on LME spot copper prices) with subsequent changes recognized in the statements of comprehensive income until the month of ~~settlement.~~maturity.

F-162

Notes to the financial statements (continued)

(ii)

Financial liability -

All financial liabilities are recognized initially at fair value and, in the case of accounts payable and other financial liabilities, net of directly attributable transaction costs. The Company´s financial liabilities include trade and other payables, other financial liabilities and embedded derivatives.

Loans-

Loans are initially recognized at their fair value, net of directly attributable transaction costs. After initial recognition, loans are subsequently measured at amortized cost using the effective interest rate method. Gains and losses are recognized in the statement of comprehensive income when the liabilities are derecognized as well as through the amortization process.

Amortized cost is calculated taking into account any discount or premium on acquisition and fees or costs that are an integral part of the effective interest rate. Amortization under the effective interest rate method is included as financial costs in the statement of comprehensive income.

(iii)

Offsetting of financial instruments –

Financial assets and financial liabilities are offset and the net amount is reported in the statements of financial position if there is a currently enforceable legal right to offset the recognized amounts and there is an intention to settle on a net basis, to realize the assets and settle the liabilities simultaneously.

(c)

Inventories –

Inventories are stated at the lower of cost or the net realizable value. Inventory of materials and supplies, as well as in progress and finished products are determined using the weighted-average cost method. The cost of finished goods and in - process inventory (i.e., stockpiles) includes labor and benefits, supplies, energy and other costs related to mining and processing of minerals. Net realizable value is the estimated future sales price based on forward metal prices (at the year that are expected to be processed), less estimated costs to complete production and bring the inventory to ~~sale;~~sale.

The current portion of work in process is determined based on the expected amounts to be processed with the next twelve months. Inventories not expected to be processed within the next twelve months are classified as long-term.

No write-down of inventories was recorded as of December 31, 2015 and ~~the discount rate.~~2014.

Provision for obsolescence -

Obsolescence allowances are established based on an item-by-item analysis made by Management. Any amount of obsolescence ~~identified~~ is charged to the statements of comprehensive income in the year ~~it is deemed~~of occurrence.

F-163

Notes to ~~have occurred.~~the financial statements (continued)

(d)

Property, plant and equipment -

Property, plant and equipment ~~are valued~~is stated at ~~historical~~ cost, ~~including costs that are directly attributed to the construction or acquisition,~~ net of accumulated depreciation ~~amortization~~ and ~~impairment.~~

~~Notes to the Financial Statements(continued)~~

~~Repairs and/or improvements~~accumulated impairment losses, if any. The initial cost of an asset comprises its purchase price or construction cost, including customs duties and non-reimbursable taxes, as well as any costs directly attributable to bringing the asset into operation, the initial estimate of the rehabilitation obligation and, in the case of qualifying assets, the cost of borrowing. The capitalized value of a finance lease is also included in this caption.

Major maintenance and repairs -

Expenditure on major maintenance refits or repairs comprises the cost of replacement assets or parts of assets and overhaul costs. Where an asset that iswas separately depreciated ~~separately~~ and is ~~required to be discharged or~~now written off is replaced, ~~creating an increase of economic life of property~~ and ~~for which~~ it is probable that ~~there will be~~the future economic ~~benefit~~benefits associated with the item will flow to the Company ~~are recorded as assets.~~through an extended life, the expenditure is capitalized. All other day-to-day maintenance and repairs costs are ~~charged to expense~~expensed as incurred.

Where part of the asset was not separately considered as a component and therefore not depreciated separately, the replacement value is used to estimate the carrying amount of the replaced assets which is immediately written off.

Depreciation–

Land is not depreciated. Depreciation of assets directly related to the useful life of the mine is calculated using the UOP method based on the mine’s proven and probable reserves. Other assets are depreciated using the straight-line method based on the following estimated useful lives:

		Years

Buildings and other constructions		Between 1015 and 3035
Machinery and equipment		Between 3 and 25
Transportation units		7
Furniture and fixtures		7
Other equipment		Between 3 and 25

~~Critical spare parts~~The asset’s residual values, useful lives and ~~those which~~methods of depreciation are ~~directly identified with machinery or equipment are included in property, plant~~reviewed, at each reporting period and ~~equipment, and the economic life assigned will be related to the main asset with which they are identified.~~adjusted prospectively, if appropriate.

Disposals–

An item of property, plant and equipment is ~~retired at the time of its~~derecognized upon disposal or when no future economic benefits are expected from its use or ~~subsequent disposition.~~disposal. Any gain or loss arising ~~at the time~~on derecognition of ~~retirement is calculated~~tproperty, plant and equipment (calculated as the difference between the net disposal proceeds ~~from the sale~~ and the ~~book value~~carrying amount of the ~~asset and~~asset) is included in the statements of comprehensive income ~~in the year~~when the asset is ~~retired.~~derecognized.

F-164

~~The residual value and useful economic lives of~~

Notes to the Company’s property, plant and equipment are reviewed, and adjusted if appropriate, at each year end. The Company also assesses, at the end of each period, whether there is an indication that its property, plant and equipment may be impaired.financial statements (continued)

(e)

Exploration ~~development~~ and ~~stripping~~development costs –

Exploration costs -

Mineral exploration costs, as well as drilling and other costs incurred for the purpose of ~~converting mineral resources to~~obtaining proven and probable reserves, or identifying new mineral resources at development or production stage properties, are charged to the statements of comprehensive income as incurred.

Development costs -

Development costs are capitalized based on the Management´s ~~judgement,~~judgment, when the economic and technological feasibility of the project is confirmed, which is generally when the development or expansion project has reached a milestone in accordance with a model established by the Company.

~~Notes~~ These costs are amortized when production beings, on the units-of-production basis over the proven and probable reserves. Development costs necessary to ~~the Financial Statements(continued)~~maintain production are expensed as incurred.

(f)

Stripping costs -

~~Stripping cost -~~

~~The Company records the cost of stripping incurred during the mine’s production stage as a variable production cost and includes them~~In accordance with IFRIC 20, “Stripping Cost in the ~~cost~~Production Phase of ~~inventory produced during the period when such~~a Surface Mine,” stripping ~~costs were incurred. Stripping~~ costs incurred in the ~~development of a mine (i.e., before~~ production ~~commences)~~phase are capitalized ~~until~~as a component of property, plant and equipment (see Note 9) if the ~~production stage~~stripping activity improves access to the ore body or enhances an existing asset. The stripping activity asset is ~~initiated and~~ subsequently amortized using the UOP method.

~~(f)~~

~~Intangible assets -~~

The intangible assets acquired are recorded at cost less accumulated amortization. As indicated in note 16(c), the Company has recorded an intangible asset for the future benefit of electrical energy at a fixed price, which is being amortized over the term of the contract, which expires December 31, 2015. The Company assesses at the end of each period, whether there is an indication that its intangible asset may be impaired.

(g)

Impairment of non-financial assets -

At each reporting date, the Company evaluates if there is any indication that an asset ~~could~~may be impaired. If ~~such an~~any indication exists, the Company estimates the recoverable amount of the asset. The recoverable amount of an asset is the ~~greater~~higher of its fair value less costs ~~to sell or~~of disposal and its value in use and is determined for the assets of the mine as a whole, since there are no assets that generate cash revenues independently.

When the ~~book value~~carrying amount of an asset exceeds its recoverable amount, the asset is considered impaired and is ~~reduced~~written down to its recoverable amount. ~~When evaluating the~~In assessing value in use, the estimated future ~~estimated~~ cash flows are discounted to their present value using a pre-tax discount rate ~~before taxes~~ that reflects current market ~~evaluations~~assessments of the time value of money and the risks specific ~~risks~~ to the asset.

~~Losses resulting from the impairment of assets~~Impairment losses are recognized in the statements of comprehensive income under the categories of expenses consistent with the function of the impaired asset. A previously recognized impairment loss is reversed only if there has been a change in the ~~estimates~~assumptions used to determine the asset’s recoverable amount since the last impairment loss was recognized. The ~~revised valuation cannot~~reversal is limited so that the carrying amount of the asset does not exceed if recoverable amount, nor exceed the ~~book value~~carrying amount that would have been determined, net of depreciation, ~~if an~~had no impairment loss been recognized for the asset ~~had not been recognized~~ in ~~a previous period.~~prior years. Such a reversal is recognized in the statements of comprehensive income.

F-165

Notes to the ~~Financial Statements~~financial statements (continued)

~~There was no indication of impairment of the Company’s assets as of December 31, 2012 and December 31, 2011.~~

(h)

Intangible assets -

Intangible assets are recognized initially at cost. After the initial recognition, the intangible assets are recorded at its cost less accumulated amortization and any accumulated loss for impairment of use, if applicable.

(i)

Provisions -

General -

~~A provision is~~Provisions are recognized when the Company has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources ~~of the Company~~embodying economic benefit will be required to settle the obligation and ana reliable estimate can be made of the amount of the ~~obligation can be calculated.~~obligation. The expense relating to ~~any~~a provision is presented in the statements of comprehensive income, net of any ~~reimbursement, in the period the provision is established.~~reimbursement.

If the effect of the time value of money is ~~significant,~~material, provisions are discounted ~~by applying~~using a ~~discount~~ rate that reflects, ~~where~~when applicable, the risks specific to the liability. When discounting is used, the increase in the provision due to the passage of time is recognized as ~~a financial expense~~finance costs in the statements of comprehensive income.

~~Mine~~Provision for remediation and mine closure ~~provision~~ -

The Company records a provision for remediation and mine closure ~~provision~~ when a contractually or legally enforceable obligation arises. The Company estimates the present value of its future obligation for mine closure and increases the carrying amount of the related “Asset Retirement Cost” - ARC, which is included in property, plant and equipment. Subsequently, the mine closure provision is accreted to full value over time and recognized as an interest cost considered in the initial fair value estimate. The related ARC is depreciated using the units-of-production method during the economic life of the mine.

The Company evaluates its provision for remediation and mine closure ~~provision annually~~quarterly and makes adjustments to estimates and assumptions, including ~~scope,~~ future costs and discount rates, as applicable. Changes in the fair value of ~~the~~provision for remediation and mine closure ~~provision~~ or the useful life of the related asset are recognized as an increase or decrease in the book value of the provision and the related ARC in accordance with IAS 16. Any decrease in the mine closure provision and related ARC ~~cannot~~may not exceed the ~~current book value~~carrying amount of the ~~asset; amounts~~asset. If it does, any excess over the ~~current book~~carrying value ~~will be recorded in~~is taken immediately to the statements of comprehensive income.

~~(i)~~(j)

Revenue recognition -

The Company primarily sells copper cathodes and concentrates in accordance with sales contracts entered into with its customers. Revenues comprise the fair value of the sale of goods, net of related ~~general~~ sales taxes. The Company recognizes revenue when the amount can be reliably measured, it is probable that ~~future~~ economic benefits will flow to the Company and all significant risks (including title and insurance risk) and rewards of ownership have transferred to the customer. Revenue is not considered reliably measured until all contingencies relating to the sale have been resolved.

F-166

Notes to the ~~Financial Statements~~financial statements (continued)

Sales of copper cathodes and concentrates –

~~Local~~Domestic sales of copper cathodes and concentrates are recognized when the Company has delivered the goods to the shipping company designated by the customer. Revenue associated with foreign sales of copper cathodes and copper concentrates is recognized when all significant risks and rewards of ownership have transferred to the customer, which is typically when the inventory has passed over the vessel’s rail at the port of loading.

As described in note ~~2.3(b)~~2.2(b), the Company’s copper sales are provisionally priced at the time of shipment. The provisional prices are finalized in a specified future month in accordance with the terms specified in the related sales contract and based on quoted LME monthly average prices. The Company receives market prices in the specified future month, and ~~these sales result~~the effect of the changes in ~~changes~~such market prices are recorded toas revenues until the specified future month. The Company records revenues and commercial invoices at the time of shipment based on the current LME prices, which result in an embedded derivative that is bifurcated from the host contract.

Since year 2014, the Company’s revenues are subject to royalties for two governmental entities. These funds will be used for these entities as part of their operational budgets for the supervision of energy and mining investment and the environment. The calculation for the OSINERGMIN contribution is 0.21% of invoiced sales for 2014, 0.19% for 2015, and 0.16% for 2016, and the calculation for the OEFA contribution is 0.15% of invoiced sales for 2014 and 2015, and 0.13% for 2016. These royalties are presented as reduction of revenues (see note 17).

~~(j)~~(k)

Borrowingcost-

Costs directly attributable to the acquisition, construction or production of a qualifying asset are capitalized as finance part of the cost of an asset. A qualifying asset is one whose value is greater than US$1 million and requires a longer period to 12 months to get ready for its intended use. All other borrowing costs are expensed in the period in which they occur. Borrowing costs consist of interest and other costs that the Company incurs in connection with the borrowing of funds.

(l)

Income taxes, deferred taxes and other taxes-

~~Income taxes~~Current income tax-

~~Income~~Current income tax assets and liabilities are measured at the amounts expected to be ~~paid to or~~ recovered from or paid or the tax ~~authorities.~~authority. The tax rates and tax laws ~~that are applied~~used to compute the ~~amounts~~amount are those that are enacted or substantially enacted, at the ~~end of the year.~~reporting period. The Company calculates the provision for current income tax based on the tax stability agreement described in ~~accordance with~~Note 16(a).

F-167

Notes to the ~~Peruvian tax legislation in force. The income tax rate in Peru was 30% as of December 31, 2012 and 2011.~~financial statements (continued)

Deferred ~~taxes~~income tax -

~~The deferred~~Deferred income tax is ~~presented~~provided using the liability method ~~for~~on temporary differences between the tax ~~bases~~basis of assets and liabilities and their ~~book values~~carrying amounts for financial reporting ~~purposes.~~purposes at their reporting date. Deferred tax liabilities are recognized for all taxable temporary differences. Deferred income tax assets are ~~recorded~~recognized for all deductible temporary differences, ~~when there~~to the extent that is ~~a probability~~probable that ~~there could~~taxable profit will be ~~future taxable earnings~~available against which the deductible temporary differences, ~~could~~and the carry forward of unused tax credits and unused tax losses can be ~~applied.~~utilized.

The ~~book value~~carrying amount of ~~the~~ deferred tax ~~asset~~assets is reviewed at ~~the end of~~ each ~~period~~reporting date and reduced to ~~an amount~~the extent that ~~is more likely than not to be realized against taxable earnings. Deferred tax assets that are not recognized are reassessed at each period and are recognized when~~ it is ~~more likely than not~~no longer probable that ~~future~~sufficient taxable ~~earnings~~profit will be available to allow ~~for~~all or part of the deferred tax asset to be ~~recovered.~~

~~Notes~~utilized. Unrecognized deferred tax assets are re-assessed at each reporting date and are recognized to the ~~Financial Statements(continued)~~extent that it has become probable that future taxable profits will allow the deferred tax asset to be recovered.

Deferred tax assets and liabilities are measured at the tax rates that are expected to ~~be applicable during~~apply in the year when the ~~assets are~~asset is realized or the ~~liabilities are liquidated,~~liability is settled, based on ~~the~~ tax rates ~~(and~~and tax ~~laws)~~laws that have been enacted or substantively enacted at the ~~end of the period.~~ reporting date.

Deferred tax assets and deferred tax liabilities are offset if ~~there is~~ a legally enforceable right to ~~offset~~set off current tax assets against current income tax liabilities and the deferred ~~tax is related~~taxes relate to the same taxable entity and the same ~~tax~~taxation authority.

~~Mining Taxes~~Peruvian mining royalties and special mining tax -

On September 29, 2011, Law No. 29788 (which amended Law No. 28528) was enacted creating a new mining tax and royalty regime in Peru.

Stability agreement effective until December 31, 2013

Under the new regime, companies that do not have stability agreements ~~will be~~were subject to a revised royalty and a special mining tax. ~~Cerro Verde operates~~The Company operated under a stability agreement and therefore iswas not subject to the revised royalty and special mining tax until its stability agreement ~~expires~~expired on December 31, 2013. The Peruvian government ~~has~~ also created a special mining burden that companies with tax stability agreements ~~can~~could elect to pay. The ~~special mining burden is based on a sliding scale of 4% to 13%, with a maximum effective tax rate of 8.79%. Cerro Verde will elect~~Company elected to pay this special mining burden during the remaining term of its stability agreement. See Note 16 (c).

~~(k)~~-

~~Workers’ profit sharing~~Stability agreement effective since January 1, 2014

Beginning January 1, 2014, under the terms of the new stability agreement, the Company will pay mining royalties and special mining tax for all its production based on Law No. 29788.

F-168

Notes to the financial statements (continued)

Mining Royalties and Special Mining Tax are in the scope of IAS 12 “Income Tax” and are considered income tax.

Supplementary Retirement Fund–

Law No. 29741, enacted on July 9, 2011, created a Mining and Metallurgical Retirement Fund, which is applicable to the Company starting 2014. Under the terms of its new 15-year stability agreement, the base of calculation of this contribution is 0.5% of pre-tax income. These funds will be used for the jubilee of the mining and metallurgical workers. The contribution is presented as income tax due to the same basis of calculation.

(m)

Benefits to employees -

Workers’ profit sharing

The Company recognizes ~~worker’s~~workers’ profit sharing Inin accordance with IAS 19, “Employees ~~Benefits”~~Benefits". ~~Workers’~~Workers' profit sharing is calculated in accordance with the Peruvian ~~laws~~law (Legislative Decree No. 892), and the ~~Company’s workers’ profit sharing~~applicable rate is 8% over the taxable net base of current year. According to Peruvian law, the limit in the ~~workers’~~workers' profit sharing that an employee ~~could~~can receive is equivalent to 18 months of wages, and any excess above such limit ~~will~~has be transferred to the Regional Government and “National ~~Found~~Fund for Employment’s Promotion and Training” (“FONDOEMPLEO”). The Company’s workers’ profit sharing is recognized as a liability in the statement of financial position and as an operating expense in the statements of comprehensive ~~income.~~income (See note 18).

~~(l)~~(n)

Basic and dilutedearningsper share -

Basic and diluted earnings per share have been calculated based on the weighted average number of common shares held during the period. When the number of shares is modified as a result of capitalization of retained earnings, the net income per basic and diluted share is adjusted retroactively for all of the periods reported. For the years ended as of December 31, ~~2012, 2011~~2015, 2014 and ~~2010,~~2013, the Company did not have any financial instrument with dilutive effects; as a result, the basic and diluted shares are the same in all years presented.

~~Notes to the Financial Statements(continued)~~

~~2.4.~~(o)

~~New IFRS and IFRIC –~~Fair value measurement -

~~Improvements and amendments to IFRS issued, effective in 2012 and also those which are not yet effective, include the following:~~The Company measures its embedded derivatives, at fair value at each statement of financial position.

~~Effective~~Fair value is the price that would be received to sell an asset or paid to transfer a liability in ~~2012.-~~

~~There are no new or amended standards and interpretations effective in 2012 that impact either~~an orderly transaction between market participants at the ~~financial position, financial results, disclosure or stated accounting policies of the Company.~~measurement date.

~~Effective in 2013.-~~

- F-169

IAS 1, Presentation of Financial Statements, effective for annual periods beginning on July 1, 2012. The amendments to IAS 1 change the grouping of items presented in the statement of comprehensive income.

IAS 27, Separate Financial Statements (revised in 2011), effective for annual periods beginning on January 1, 2013. As a consequence of the new IFRS 10 and IFRS 12, what remains in IAS 27 is limited to accounting for subsidiaries, joint arrangements and associates in separate financial statements.

~~IAS 19, “Employee Benefits (Amendment)”, effective January 1, 2013, amends the recognition and disclosure requirements for defined benefit plans.~~

IFRS 9, “Financial Instruments”, effective January 1, 2015, modifies the treatment and classification of financial assets established by IAS 39, “Financial Instruments: Recognition and Measurement”.

IFRS 10, “Consolidated Financial Statements”, effective January 1, 2013, replaces the consolidation requirements in SIC-12, “Consolidation—Special Purpose Entities” and IAS 27, “Consolidated and Separate Financial Statements”.

IFRS 11, “Joint Arrangement”, effective January 1, 2013, addresses inconsistencies in the reporting of joint arrangements by requiring a single method to account for interests in jointly controlled entities. The guidance focuses on the rights and obligations of the joint arrangement, rather than its legal form (as is currently the case).

Notes to the ~~Financial Statements~~financial statements (continued)

The Company uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximizing the use of relevant observable inputs and minimizing the use of unobservable inputs.

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorized within the fair value hierarchy, described, as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

~~IFRS 12, “Disclosure of Interests~~Level 1 — Quoted (unadjusted) market prices in ~~Other Entities”, effective January 1, 2013, is a new and comprehensive standard on disclosure requirements~~active markets for ~~all forms of interests in other entities, including subsidiaries, joint arrangements, associates and unconsolidated structured entities.~~identical assets or liabilities

~~IFRS 13, “Fair Value Measurement”, effective January 1, 2013, defines~~Level 2 — Valuation techniques for which the lowest-level input that is significant to the fair value ~~sets out a framework for measuring fair value and requires disclosures about fair value measurements.~~measurement is directly or indirectly observable

~~IFRIC 20, “Stripping Costs in~~Level 3 — Valuation techniques for which the ~~Production Phase of a Surface Mine”, effective January 1, 2013, clarifies when~~lowest level input that is significant to the ~~stripping cost in the production phase should be recognized as an asset andhow that asset should be measured, both initially and in subsequent periods.~~fair value measurement is unobservable

~~Annual improvements to IFRS (issued in May 2012) -~~For the purpose of fair value disclosures, the Company has determined classes of assets and liabilities based on the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above

-3.

~~IAS 1, Presentation of Financial Statements, clarifies the difference between voluntary annual comparative information~~Accounting estimates, judgments and ~~the minimum required of comparative period is the previous period.~~assumptions –

The preparation of the Company’s financial statements according to IFRS requires Management to make judgments, estimates and assumptions to determine the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities to the date of financial statements, and for the reported amounts of revenues and expenses for the years finished as of December 31, 2015, 2014 and 2013.

Information about estimations and judgments taken into account by Management in the preparation of the financial statements follows:

-3.1

~~IAS 16, Property, Plant and Equipment, clarifies that major spare parts and servicing equipments that meet the definition of property, plant and equipment are not inventories.~~Judgments -

(a)

Contingencies -

-(b)

~~IAS 32, Financial Instruments: Presentation, clarifies that income taxes arising from distributions to equity holders are accounted for in accordance with IAS 12.~~Stripping cost -

The Company incurs waste removal costs (stripping costs) during the development and production phases of its surface mining operations. During the production phase, stripping costs (production stripping costs) can be incurred both in relation to the production of inventory in that period and the creation of improved access and mining flexibility in relation to ore to be mined in the future. The former are included as part of the costs of inventory, while the latter are capitalized as a stripping activity asset, where certain criteria are met.

~~Such~~

F-170

Notes to the financial statements (continued)

Once the Company has identified its production stripping for each surface mining operation, it identifies the separate components of the ore bodies for each of its mining operations. An identifiable component is a specific volume of the ore body that is made more accessible by the stripping activity. Significant judgment is required to identify and define these components, and also to determine the expected volumes (e.g., in tons) of waste to be stripped and ore to be mined in each of these components.

3.2

Estimates and assumptions -

(a)

Determination of mineral reserves and resources -

Ore reserves are estimates of the ore quantity that can be economically and legally extracted from the mine concessions. The Company estimates its ore reserves based on information compiled by individuals qualified in reference to geological data about the size, depth and form of the ore body, and requires of geological judgments in order to interpret the data.

The estimation of recoverable reserves is based on factors such as estimated exchange rates, commodity prices, future requirements of capital and production costs, together with geological hypothesis and judgments made when estimating the size and quality of ore. Revisions in reserve or resource estimates have an impact on the value of mining properties, property, plant and equipment, provisions for cost of mine closure, recognition of assets for deferred taxes and depreciation and amortization of assets.

(b)

Units of production depreciation -

(c)

Provision for remediation and mine closure-

The Company assesses its provision for remediation and mine closure quarterly. It is necessary to make estimates and assumptions in determining this provision, including cost estimates of activities that are necessary for the rehabilitation of the site, technological and regulatory changes, interest rates and inflation rates. As discussed in Note 2.2(i), estimated changes in the fair value of the provision for remediation and mine closure or the useful life of the related assets are recognized as an increase or decrease in the book value of the provision and related asset retirement cost (ARC) in accordance with IAS 16, “Property, Plant and Equipment”.

F-171

Notes to the financial statements (continued)

If any change in the estimate results in an increase to the provision for remediation and mine closure and related ARC, the Company shall consider whether or not this is an indicator of impairment of the assets and will apply impairment tests in accordance with IAS 36, “Impairments of Assets”.

(d)

Inventories -

Because it is generally impracticable to determine copper contained in mill and leach stockpiles by physical count, a reasonable estimation method is employed. The quantity of material delivered to mill and leach stockpiles is based on surveyed volumes of mined material and daily production records. Sampling and assaying of blasthole cuttings determine the estimated copper grades of material delivered to mill and leach stockpiles.

(e)

Asset impairment -

Management has determined that the Company’s operations consist of one cash generating unit. Therefore, the Company’s operations are evaluated annually in order to determine if there are impairment indicators. If any such indication exists, the Company makes an estimate of the recoverable amount, which is the greater of the fair value less costs to sell and the value in use. These assessments require the use of estimates and assumptions, such as long-term commodity prices, discount rates, operating costs, and others.

F-172

Notes to the financial statements (continued)

As a result of the decline in copper prices, the Company evaluated its long-lived assets for impairment as of December 31, 2015, which did not result in any impairment charges. The determination of value in use is considered to be a Level 3 fair value measurement, as it is derived from valuation techniques that include inputs that are not based on observable market data. The Company considers the inputs and the valuation approach to be consistent with the approach taken by market participants.

The key assumptions/inputs used in the determination of the Company’s fair value included production volumes, copper prices and discount rates. Estimated production volumes are based on detailed life-of-mine plans and are dependent on a number of variables, including recoverable quantities, the production profile, production costs, and the selling price of the commodities extracted. Short-term copper prices used in determining value in use ranged from US$2.13 to US$2.16 per pound, which were based on quoted forward market prices as of December 31, 2015, and the long-term copper price assumption was US$3.00 per pound, which reflects management’s long-term view of global supply and demand. In addition to estimates of production volumes and copper price assumptions, the determination of value in use was based on an post-tax discount rate of 8.5% applied to the future estimated cash flows; which was derived from the weighted average cost of capital, with appropriate adjustments made to reflect the risks specific to the Company.

There was no asset impairment loss for the Company as of December 31, 2015 and 2014.

Standard issued but not effective

Following is a summary of improvements and amendments to IFRS that are not yet effective but will be applicable to the Company.

IFRS 9 Financial Instruments

In July 2014, the IASB issued the final version of IFRS 9 Financial Instruments that replaces IAS 39 and all previous versions of IFRS 9. IFRS 9 brings together all three aspects of the accounting for financial instruments project: classification and measurement, impairment and hedge accounting. IFRS 9 is effective for annual periods beginning on or after January 1, ~~2013.~~2018, with early application permitted.The adoption of IFRS 9 is not expected to have a significant effect on the classification and measurement of the Company’s financial assets and liabilities.

F-173

Notes to the financial statements (continued)

~~Management~~IFRS 15 Revenue from Contracts with Customers

~~Notes~~adoption of IFRS 15 to ~~the Financial Statements(continued)~~have a material impact on its financial statements.

3.5.

Cash and cash equivalents

(a)

This item is made up usas follows:

	2012		2011		2015		2014
	US$(000)		US$(000)		US$(000)		US$(000)

Cash in banks						5,604		7,698
Cash equivalents (b)		1,421,955		1,376,818		348		11,876
Cash in banks		5,573		6,818

		1,427,528		1,383,636		5,952		19,574

(b)

Cash equivalents comprises a portfolio of investments in highly marketable liquid investments (investments classified as “AAA” by Standard & Poor’s and Moody’s), which yield variable returns, and are classified as cash equivalents because they are readily convertible to known amounts of cash. During the year 2015, Management ~~plans to use them~~used the majority of its investments for its short-term cash needs. Because of the short ~~original~~ maturity of these investments, less than 90 days, the carrying amount of these investments corresponds to their fair value at the date of the financial statements. Changes in the fair value of these investments are insignificant.

4.6.

Trade accounts receivable

Trade accounts receivable are generated primarily from the Company’s cathode and copper concentrate sales, are denominated in US dollars, have current maturities, do not bear interest and have no specific guarantees.

5. F-174

~~Other long-term accounts receivable~~

Correspond to additional disbursements made by the Company related to the monthly pre payments of income tax which might be offset with future tax debts or be recovered by a request of refund to the Tax authority. As of December 31, 2012, these overpayments amounted to US$63,964,000 and are presented as non-current assets in the statement of financial position.

Notes to the ~~Financial Statements~~financial statements (continued)

6.7.

Non-financial assets

(a)

This item is made up as follows:

	2015		2014
	US$(000)		US$(000)
Short-term
Value added tax credit (VAT) (b)		408,202		222,357
Income tax prepayments (c)		21,718		-
Other taxes to be recovered		2,379		2,719

		432,299		225,076
Long-term
Other accounts receivable (d)		180,741		182,756
Income tax prepayments (c)		91,879		30,728
Installment program (mining royalties case) (e)		64,405		39,700
Value added tax credit (VAT) (b)		44,977		-

		382,002		253,184

(b)

Mainly attributable to purchases related to the expansion of the Company´s production unit (See Note 1(b)). The Company expects to recover the VAT credits in short and long-term.

(c)

Corresponds to disbursements made by the Company related to prepayment of income tax, which the Company expects to use to offset with future tax obligations or will be refunded to the Company by the Tax Authority.

(d)

Corresponds to disbursements made by the Company under protest in connection with disputed tax assessments from years 2004 to 2010. The most significant issues observed are:

Deductibility of certain management fees rendered by a related entity;

Application of accelerated depreciation deduction related to the first concentrator plant as it claims the Company is not entitled to this benefit under its 1998 stability agreement; and

Certain disbursements would qualify as fixed assets.

These claims are currently under review in the Tax Court. According to current tax procedures and time frame for resolving these types of claims, the Company and its legal advisors expect favorable resolution in all cases due to the strength of their arguments.

(e)

Corresponds to payments made under protest by the Company in connection to installment program approved by the tax authority associated with mining royalties for the period December 2006 to December 2008, which is described in Note 16(e). Management expects that the resolution of this matter will be favorable to the Company.

F-175

Notes to the financial statements (continued)

Inventories, net

(a)

This item is made up as follows:

	2012			2011			2015			2014
	US$(000)			US$(000)			US$(000)			US$(000)
Finished goods:
Copper concentrate								8,948			11,942
Copper cathodes		7,481			7,565			11,865			8,809
Copper concentrate		12,728			6,079
Molybdenum concentrate		1,467			1,264			1,292			1,821

Balance of finished goods, see note 14		21,676			14,908

Balance of finished goods								22,105			22,572
Work-in-process (b)		213,734			165,635			445,003			326,676
Materials and supplies		149,874			137,137			247,107			170,146
Materials and supplies in transit		1,326			761			1,315			1,269
Less - Provision for obsolescence of materials and supplies		(2,711	)		(1,933	)		(692	)		(407	)

Total Inventories		383,899			316,508			714,838			520,256
Less - Long-term inventories (b)		(188,990	)		(140,671	)		(319,971	)		(287,714	)

Current inventories, net		194,909			175,837			394,867			232,542

(b)

~~Work in process~~Work-in-process inventories represent mill and leach stockpiles which ~~generally~~ contain higher grade ores and medium and lower grade ores that have been extracted from the ~~ore body~~open pit and are available for copper recovery. Based on the mine future plan production, the Company identifies the portion of inventory that is going to be classified as short or long term. For mill stockpiles, recovery is through milling and concentrating. For leach stockpiles, recovery is through exposure to acidic solutions that dissolve copper and ~~deliver~~delivery it in solution to ~~the~~ extraction processing facilities (see note ~~2.2(e)~~3.2(d)).

F-176

Notes to the ~~Financial Statements~~financial statements (continued)

7.9.

Property, plant and equipment, net

(a)

The movement in cost and accumulated depreciation accounts as of December 31, ~~2012~~2015 and ~~2011~~2014 are shown below:

January 1,
2011 Additions Retirements
and disposals Transfers December 31,
2011 Additions Retirements
and disposals Transfers December 31,
2012
US$(000) US$(000) US$(000) US$(000) US$(000) US$(000) US$(000) US$(000) US$(000)
Land 1,497 - - - 1,497 - - - 1,497
Buildings and other constructions 91,042 - - 13,046 104,088 - (20 ) 25,061 129,129
Machinery and equipment 1,447,076 - (4,667 ) 67,916 1,510,325 - (101 ) 240,006 1,750,230
Transportation units 8,849 - - 2,433 11,282 - (767 ) 1,655 12,170
Furniture and fixtures 786 - - - 786 - - - 786
Other equipment 11,862 - (129 ) 737 12,470 - (1,046 ) 10,283 21,707
Work in progress and transit units (b) 69,801 195,222 - (84,132 ) 180,891 600,872 - (277,005 ) 504,758
Remediation and mine closure costs, note 16(a) 3,666 3,217 - - 6,883 72,512 - - 79,395

1,634,579 198,439 (4,796 ) - 1,828,222 673,384 (1,934 ) - 2,499,672

Accumulated depreciation
Buildings and other constructions 26,019 2,786 - - 28,805 2,675 (17 ) - 31,463
Machinery and equipment 483,678 77,593 (605 ) - 560,666 88,346 (68 ) - 648,944
Transportation units 6,733 714 - - 7,447 933 (767 ) - 7,613
Furniture and fixtures 532 94 - - 626 87 - - 713
Other equipment 6,428 1,055 (129 ) - 7,354 1,820 (1,058 ) - 8,116
Remediation and mine closure costs 2,544 189 - - 2,733 381 - - 3,114

525,934 82,431 (734 ) - 607,631 94,242 (1,910 ) - 699,963

Net cost 1,108,645 1,220,591 1,799,709

	January 1, 2014		Additions		Retirements and disposals			Adjustments and reclassifications			Transfers			December 31, 2014		Additions		Retirements and disposals			Adjustments and reclassifications			Transfers			December 31, 2015
	US$(000)		US$(000)		US$(000)			US$(000)			US$(000)			US$(000)		US$(000)		US$(000)			US$(000)			US$(000)			US$(000)

Cost
Land		1,737		-		-			-			13,538			15,275		-		-			-			5,109			20,384
Buildings and other constructions		145,909		-		(2,710	)		405			39,304			182,908		-		(1,099	)		7,571			2,012,742			2,202,122
Machinery and equipment		1,870,419		-		(25,974	)		(7,525	)		171,429			2,008,349		-		(19,537	)		(7,571	)		2,222,190			4,203,431
Transportation units		14,981		-		(389	)		35			2,575			17,202		-		(284	)		-			2,709			19,627
Furniture and fixtures		786		-		-			4			-			790		-		(3	)		-			163			950
Other equipment		22,219		-		(228	)		-			270			22,261		-		(984	)		-			3,451			24,728
Work in progress and transit units (b)		1,434,552		1,771,715		-			-			(227,116	)		2,979,151		1,629,271		-			-			(4,246,364	)		362,058
Asset remediation and mine closure, note 13(b)		43,454		93		-			68,840			-			112,387		3,534		-			33,803			-			149,724
Stripping activity asset		102,557		49,122		-			-			-			151,679		111,819		-			-			-			263,498
		3,636,614		1,820,930		(29,301	)		61,759			-			5,490,002		1,744,624		(21,907	)		33,803			-			7,246,522

Accumulated depreciation
Buildings and other constructions		34,767		4,912		(1,583	)		-			220			38,316		20,510		(1,059	)		3,136			-			60,903
Machinery and equipment		747,161		111,823		(22,030	)		-			(229	)		836,725		151,460		(18,524	)		(3,136	)		-			966,525
Transportation units		6,903		1,719		(383	)		-			9			8,248		1,741		(266	)		-			-			9,723
Furniture and fixtures		771		5		-			-			-			776		5		(4	)		-			-			777
Other equipment		10,675		1,065		(228	)		-			-			11,512		2,054		(984	)		-			-			12,582
Asset remediation and mine closure		4,558		560		-			-			-			5,118		2,053		-			-			-			7,171
Stripping activity asset		-		44,901		-			-			-			44,901		66,651		-			-			-			111,552
		804,835		164,985		(24,224	)		-			-			945,596		244,474		(20,837	)		-			-			1,169,233

Net Cost		2,831,779													4,544,406													6,077,289

(b)

~~As of December 31, 2012, the work in progress and transit units corresponded mainly~~Borrowing cost related to the ~~Expansion of Cerro Verde´s production unitfor~~qualifying assets, which have been capitalized in “Work in progress” during the period 2015 amounted to US$~~439,608,000. See note 1(b)~~33,719,000 (US$16,305,000 during the year 2014).

~~(c)~~ F-177

~~The Company maintains insurance on its principal assets in accordance with Management’s policies.~~

Notes to the ~~Financial Statements~~financial statements (continued)

8.10.

Trade accounts payable

Trade accounts payable are mainly originated by the acquisition of materials, supplies and spare parts for the Company’s mining activities. ~~As of December 31, 2012, payable balances are related to the Mine Expansion Project, see note 1(b).~~ These obligations are mainly in US dollars, have current maturities and do not accrue interest. No guarantees have been granted. As of December 31, 2015, trade accounts payable includes US$279,378,000 related to capital projects mainly associated with Cerro Verde’s production unit expansion (US$318,957,000 as of December 31, 2014).

9.11.

~~Workers’ profit sharing~~Employees benefits liability

(a)

The Legislative Decree N° 892 (L.D. 892), issued in 1996, regulates the right of workers to participate in the company’s profits that performs activities generating third categories income and requires companies domiciled in Peru to compute and pay to employees a share of the profits generated by the companies for which they work. The Company’s liability for worker’ profit sharing is recognized according to the policy described in note 2.3(k).

~~(b)~~

As described in note 2.3(k), workers’ profit sharing is recognized as an operating expense in the statements of comprehensive income. The amount of workers’ profit sharing paid to employees for the years 2012 and 2011 are recognized as a cost of sales of goods (see note 14). Additionally, the excess between the Company’s total workers’ profit sharing liability and the amount paid or due to employees for the years 2011 and 2010 amounted to US$21,923,000 and US$34,427,000, respectively (in 2012, no excess of worker´s profit sharing was calculated). The amounts for 2011 and 2010 were included as operating expenses in the statements of comprehensive income and were paid to the Regional Government and FONDOEMPLEO within the periods established by law.

~~Notes to the Financial Statements(continued)~~

~~10.~~

~~Deferred Income tax~~

~~(a)~~

~~The Company recognizes the effect of temporary differences between the accounting base for financial reporting purposes and the tax base. The composition of this~~This item is made up as follows:

January 1, 2011 Debit (credit) to
the statements of
comprehensive
income December 31,
2011 Debit (credit) to
the statements of
comprehensive
income December 31,
2012
US$(000) US$(000) US$(000) US$(000) US$(000)
Income tax
Asset
Provision for water plant construction 24,137 3,342 27,479 (27,479 ) -
Price adjustment of cathodes and copper concentrates - 22,577 22,577 (22,577 ) -
Difference in valuation of inventories 1,869 1,086 2,955 (1,339 ) 1,616
Provision for remediation and mine closure 710 163 873 238 1,111
Deferred stripping costs 731 (76 ) 655 (34 ) 621
Provision generated by the special mining burden - - - 6,356 6,356
Other provisions 1,174 (5,355 ) (4,181 ) 4,267 86

28,621 21,737 50,358 (40,568 ) 9,790

Liability
Difference in depreciation method 189,180 39,677 228,857 17,681 246,538
Price adjustment of cathodes and copper concentrates 39,965 (39,965 ) - 3,471 3,471

229,145 (288 ) 228,857 21,152 250,009

Deferred liabilities, net 200,524 (22,025 ) 178,499 61,720 240,219

Mining taxes, note 12(d)
Deferred asset
Price adjustment of cathodes and copper concentrates - (3,637 ) (3,637 ) 4,153 516
Exploration expenses - (190 ) (190 ) (302 ) (492 )

Deferred asset - (3,827 ) (3,827 ) 3,851 24

	2015		2014
	US$(000)		US$(000)

Wages payable		20,454		11,138
Profit sharing payable		82		33,274
		20,536		44,412

~~Notes~~

The Legislative Decree No. 892 (L.D. 892), issued in 1996, regulates the right of workers to participate in a company’s profits that performs activities generating third categories income and requires companies domiciled in Peru to compute and pay to employees a share of the profits generated by the companies for which they work. The Company’s liability for workers’ profit sharing is recognized according to the ~~financial statements(continued)~~policy described in note 2.2(m).

January 1, 2011 Debit (credit) to
the statements of
comprehensive
income December 31,
2011 Debit (credit) to
the statements of
comprehensive
income December 31,
2012
US$(000) US$(000) US$(000) US$(000) US$(000)

Total debited (credited) to the statements of comprehensive income - (25,852 ) - 65,571 (b) -

Total deferred income tax liability 200,524 174,672 240,243

~~Notes~~The workers’ profit sharing is recognized as an operating expense in the statements of comprehensive income. The amount of workers’ profit sharing paid to ~~the financial statements(continued)~~

~~(b)~~

For the years ended December 31, 2012, 2011 and 2010, the income tax expense recorded differs from the result of apply the legal rate to the income before income tax of the Company, as detailed below:

2012 2011 2010
US$(000) US$(000) US$(000)

Profit before income tax 1,215,358 1,562,117 1,557,663
Income tax rate 30 % 30 % 30 %

Income tax expected expense 364,607 468,635 467,299

Effect of change in income tax rate to 32% due to Tax Stability Agreement effective since 2014, note 12(a) 11,583 - -
Non deductible expenses 11,845 5,298 3,647
Special mining burden (current and deferred) (28,823 ) - -
Voluntary contribution - - 12,324
Others (2,242 ) - -

Current and deferred income tax charges to results 356,970 473,933 483,270
Mining taxes charge to results 86,318 9,785 -

443,288 483,718 483,270

Effective income tax 36.47 % 30.97 % 31.03 %

~~(c)~~

~~The income tax expenses (benefit) for the years ended December 31, 2012 and 2011 is shown below:~~

2012 2011 2010
US$(000) US$(000) US$(000)
Income tax
Current 295,250 495,958 417,594
Deferred 61,720 (22,025 ) 65,676

356,970 473,933 483,270
Mining taxes
Current 82,467 13,612 -
Deferred 3,851 (3,827 ) -

86,318 9,785 -

Income tax expense reported in the statements of comprehensive income 443,288 483,718 483,270

~~Notes to the financial statements(continued)~~

~~11.~~

~~Equity, net~~

~~(a)~~

~~Issued capital -~~

~~As of December 31, 2012, 2011 and 2010, the authorized, subscribed and paid-up capital in accordance with the Company’s by-laws and its related modifications was 350,056,012 common shares.~~

According to the shareholders agreement of July 11, 2003, the nominal value of the shares was denominated in US dollars and amount to US$0.54 each. As a consequence of the capitalization of restricted earnings associated with tax benefit (reinvestment credit), in December 2009, the nominal value of the share was increased to US$2.83 each.

As of December 31, 2012 the quoted price of these shares was US$38.00 per share (US$36.00 and US$54.10 per share as of December 31, 2011 and 2010, respectively) and their frequency of trading is daily, as in 2011 and 2010.

~~As of December 31, 2012, the Company’s capital stock structure is as follows:~~

Percentage of individual interest in capital Number of
shareholders Total percentage
interest

Up to 1.00 3,121 5.86
From 1.01 to 20.00 1 19.58
From 20.01 to 30.00 1 21.00
From 30.01 to 60.00 1 53.56

3,124 100.00

~~(b)~~

~~Other capital reserves -~~

~~In accordance with the Peruvian Companies Act, this reserve is created through the transfer of 10% of the earnings~~employees for the ~~year up to~~years 2015, 2014 and 2013 are recognized as a ~~maximum~~cost of ~~20%~~sales of the paid-in capital. The legal reserve must be used to compensate losses, and must be replaced with future earnings. This reserve may also be used to increase capital stock but the balance must be restored from future earnings.

~~(c)~~

~~Retained earnings -~~

~~In accordance with the mining stability agreement entered into with the Peruvian Government~~goods (see note ~~12(a)),~~18). Additionally, during 2015, 2014 and 2013 no excess of workers´ profit sharing was calculated between the ~~Company is authorized~~total workers’ profit sharing liability and the amount paid or due to distribute, without any restrictions, all capital invested (except for the retained earnings capitalized in 2009 for US$800,030,000). In addition, dividends and any other form of capital distribution to domestic entities are tax exempt. Since 2003, dividends paid to shareholders, other than domiciled legal entities, are subject to a 4.1% income tax which is withheld and paid by the Company.

~~Notes to the financial statements(continued)~~

~~(d)~~

~~Dividend distribution -~~

~~During 2012 and 2011, the Company did not pay dividends.~~

At the Directors’ meeting held on June 15, 2010, it was agreed to pay a dividend of US$400,000,000 (US$1.1427 per common share). Of this amount, US$257,303 corresponds to the retained earnings as of December 31, 2009, and US$142,697,000 was applied to earnings for the year 2010. This dividend was paid to shareholders on July 19, 2010.

At the Directors’ meeting held on November 8, 2010, it was agreed to approve the payment of dividends amounting to US$550,000,000 (US$1.5712 per common share). The total amount of this dividend was applied to retained earnings as of October 31, 2010, and earnings for the year 2010 related to the dividend related to the 2010 period. This dividend was paid to the shareholders on December 10, 2010.employees.

12.

~~Tax situation~~Other financial liabilities

(a)

On February 13, 1998, the Company signed an Agreement of Guarantees and Measures to Promote Investments with the Government of Peru, under the Peruvian General Mining Law. Upon approval of the agreement, the CompanyThis item is subject to the tax regulations in force at May 6, 1996. In addition, the Company has tax stability for a period of fifteen years beginning January 1, 1999 and with a maturity date of December 31, 2013.made up as follows:

On July 17, 2012, the Company subscribed a new Agreement of Guarantees and Measures to Promote Investments with the Government of Peru, under the General Mining Law and in connection with the Expansion of Cerro Verde´s production mining unit Project, see note 1(b). According to the management´s option, it will be in force in 2014. According to this agreement, from the time it is in force, the new income tax rate will be 32%.

	2015			2014
	US$(000)			US$(000)

Financial obligations with financial institutions:
Senior unsecured credit facility, (b)		1,780,928			402,357
Promissory notes (c)		43,000			50,000
Leasings		329			492
		1,824,257			452,849
Financial obligations with shareholders (d)		600,907			-
		2,425,164			452,849
Less – current portion		(43,169	)		(50,163	)
Non - current portion		2,381,995			402,686

(b)

~~The income tax rate applicable to~~In March 2014, the Company ~~is 30% and 32% beginning in 2014 according to the paragraph above. In addition, the Company is subject to~~entered into a minimum income tax equivalent to 2% of total assets until 2013, net of accumulated depreciation and amortization. The tax charged against earnings is the higher of the income tax under the tax stability agreements and the minimum income tax. For the years ended December 31, 2012, 2011 and 2010, the taxable income according to the tax law is calculated on the profit before income tax and profit sharing for such years, and the income tax calculations arefive-year US$1.8 billion senior unsecured credit facility with several banks, led by Citibank N.A., as ~~follow:~~

~~Notes to the financial statements(continued)~~

2012 2011 2010
US$(000) US$(000) US$(000)

Profit before income tax 1,215,358 1,562,117 1,557,663
Worker´s profit sharing 81,708 143,271 109,023

1,297,066 1,705,388 1,666,686

Less:
Reversal of price adjustment of copper cathodes and concentrates (75,257 ) 133,217 64,760
Water treatment plant and voluntary contribution (91,686 ) 13,723 45,379
Price adjustment of copper cathodes and concentrates (11,569 ) 75,257 (133,217 )
Non deductible expenses 39,484 5,502 4,354
Special mining burden (74,891 ) - -
Adjustment of inventory in process and finished goods (15,752 ) 3,708 11,030
Deduction to recalculate depreciation at an annual rate of 20% (5,564 ) (147,902 ) (149,722 )
Other additions, net (1,478 ) 2,999 2,867

(236,713 ) 86,504 (154,549 )

Sub-total 1,060,353 1,791,892 1,512,137
Workers’ profit sharing (8%) (84,828 ) (143,351 ) (120,971 )

Net profit 975,525 1,648,541 1,391,166

Income tax (30%) (292,657 ) (494,562 ) (417,350 )

Prior years income taxes (2,593 ) (1,396 ) (244 )

Total current income taxes charged to results, note 10(c) (does not include Special Mining Burden) 295,250 495,958 417,594

~~(c)~~

Peruvian Tax Authorities (SUNAT) have the right to examine, and, if necessary, amend the income tax as determined by the Company during the last four years, calculated from the year following that in which the tax returns are filed. The income tax filings for the years 2002 through 2011 and the value added tax filings for the period from January 2009 to December 2011 are open to examination by The Tax Authorities. The fiscal years 2002 through 2007, has been reviewed by SUNAT, by which the Company has been in appeal process. The years 2008, 2009 and 2010 are currently in revision process, these processes are in charged to the legal external advisors of the Company. In Management’s and legal advisors’ opinion, they have enough arguments in accordance to legal standards in force; consequently, they believe they will get results in favor to the Company for those processes and any additional tax assessment would not be significant to the financial statements.

~~Notes to the financial statements(continued)~~

For the periods pending to examine, and due to the many possible interpretations of current legislation, it is not possible to determine whether or not future reviews will result in tax liabilities for the Company. In the event that additional taxes are payable, including interest and surcharges, as a result of the Tax Authority reviews, they will be charged to expense in the period assessed. However, in Management’s and legal advisors’ opinion, any additional tax assessment would not be significant to the financial statements.

~~(d)~~

~~Mining taxes -~~

As described in note 2.3(j), Law 29788 was enacted creating a new mining tax and royalty regime in Peru. Because the Company operates under a stability agreement, it is not subject to the revised royalty and special mining tax until its stability agreement expires on December 13, 2013. However, the Company elected to pay the special mining tax during the remaining term of its stability agreement. For the years ended December 31, 2012 and 2011, the Company recorded a tax provision of US$82,467,000 and US$13,612,000, respectively,~~related to the special mining burden. Likewise,the Company has also recognized an expense and income deferred tax amounting to US$3,851,000 and US$3,827,000 during the years 2012 and 2011, respectively.~~

~~(e)~~

On June 23, 2004, Law No.28258 - Mining Royalty Law was approved, and requires the holder of a mineral concession to pay a royalty in return for the exploitation of metallic and non metallic minerals, which is calculated using rates from one to three percent of the value of concentrate or its equivalent according to the international price of the commodity published by the Ministry of Energy and Mines.administrative agent.

Based on the stability contract described in the literal (a) above, the payment of the mining royalties is not applicable to the Company, because this Law was approved after the Company signed the stability contract with the Peruvian Government.

SUNAT has assessed mining royalties on materials processed by the Company´s concentrator plant which commenced operations in late 2006. These assessments cover the period October 2006 to December 2007 and the years 2008 and 2009. SUNAT has issued resolutions denying the Company’s claims. The Company has appealed these decisions and currently has three cases pending before the Peruvian Tax Tribunal. The Company is challenging these royalties because it believes its stability agreement provides an exemption for all minerals extracted from its mining concession, irrespective of the method used for processing those minerals. Although we believe our interpretation of the stability agreement is correct, if the Company is ultimately found responsible for these assessments, the amount of royalty and related interest payable would be significant. SUNAT may continue to assess mining royalties annually until this matter is resolved by the Peruvian Tax Tribunal.

~~Notes to the financial statements(continued)~~

~~13.~~

~~Sales of goods~~

~~(a)~~

~~For the years ended December 31, 2012, 2011 and 2010, sales of goods are made up of the following:~~

2012 2011 2010
Pounds(000) US$(000) Pounds(000) US$(000) Pounds(000) US$(000)
(Unaudited) (Unaudited) (Unaudited)

Copper concentrates (b) 469,644 1,544,647 489,314 1,637,841 472,497 1,607,815
Copper cathodes (b) 119,077 434,290 167,562 673,956 181,885 625,827
Other (primarily silver and molybdenum concentrates) - 148,086 - 208,253 135,346

2,127,023 2,520,050 2,368,988

Sales to related parties amounted to US$1,631,221,000 for the year ended December 31, 2012 (US$1,876,906,000 and US$1,868,233,000 for the years ended December 31, 2011 and 2010, respectively), which are summarized in note 17(b).

~~(b)~~

As described in note 2.3(b), the Company’s copper sales are provisionally priced at shipment date. As a result, as of December 31, 2012, 2011 and 2010, the Company had embedded derivatives recorded in its statement of financial position (see note 19). Adjustments to the provisional prices are recognized as gains and losses in sales of goods until the month of settlement. Copper concentrate and cathode sales include adjustments to the provisional sale value generated by the changes in the fair value of the embedded derivatives. These adjustments resulted in higher, lower and higher sales for US$86,826,000, US$208,474,000 and US$68,457,000 in years 2012, 2011 and 2010, respectively.

~~(c)~~

~~The following table shows sales of goods by geographic region based for the years ended December 31, 2012, 2011 and 2010:~~

2012 2011 2010
US$(000) US$(000) US$(000)

Asia 1,267,407 1,351,762 1,374,467
South America (mainly Peru) 389,613 445,114 291,993
Europe 378,144 513,933 483,208

~~Notes to the financial statements(continued)~~

2012 2011 2010
US$(000) US$(000) US$(000)
North America 91,859 209,241 219,320

2,127,023 2,520,050 2,368,988

~~(d)~~

~~Concentration of sales -~~

For the year 2012, 77% of the Company’s sales were to related entities (Freeport-McMoRan Corporation (“FMC”), Sumitomo Metal Mining Company and Climax Molybdenum, which is a wholly owned subsidiary of FMC) and the rest, with international third parties. For the years 2011 and 2010, 74% and 79% of the Company’s sales were to these related entities.

~~F-176~~

F-178

Notes to the financial statements(continued)

The credit facility allows for term loan borrowings up to the full amount of the facility, less any amounts issued and outstanding under a $500 million sublimit. Interest on amounts drawn under the term loan is based on London Interbank Offered Rate (LIBOR) plus a spread (currently 2.4 %) based on the Company´s total net debt to earnings before interest, taxes, depreciation and amortization (EBITDA) ratio as defined in the agreement. The disbursements were mainly used to finance a portion of the Company´s expansion project.

The credit facility amortizes in three installments in amounts necessary to comply the commitment of the requested amounts under the loan. The first installment should paid at least 15% (85% of the outstanding balance) as of September 30, 2017, the second installment at least 30% (70% of the outstanding balance) as of March 31, 2018, and the third installment not less than 65% (35% of the outstanding balance) as of September 30, 2018, with the remaining balance due on the maturity date of March 10, 2019.

As of December 31, 2015, the Company has used the total credit line (US$1.8 billion). No letters of credit were issued.

There are no guarantees provided for the credit facility.

~~14.~~

~~Cost of sales of goods~~Covenants -

~~For the years ended December 31, 2012, 2011 and 2010, the cost of sales of goods is made up of the following:~~

2012 2011 2010
US$(000) US$(000) US$(000)

Opening balance of finished goods (see note 6(a)) 14,908 16,505 5,856

Materials and supplies 362,382 315,518 276,297
Labor 110,156 134,813 79,914
Worker’s profit sharing 81,737 121,347 86,568
Depreciation and amortization 95,872 84,061 87,686
Energy 73,136 69,259 53,001
Third parties services 88,489 74,202 69,350
Management fees (see note 17(a)) 18,210 20,003 17,850
Other costs 26,456 23,021 14,182
Variation of inventories in process (48,099 ) (19,121 ) (28,240 )
Ending balance of finished goods (see note 6(a)) (21,676 ) (14,908 ) (16,505 )

801,571 824,700 645,959

~~15.~~

~~Selling expenses~~

~~For the years ended December 31, 2012, 2011 and 2010, selling expenses are made up of the following:~~

2012 2011 2010
US$(000) US$(000) US$(000)

Concentrate’s freight 74,816 79,097 69,631
Commissions 2,759 3,035 3,996
Cathode’s freight 1,099 1,480 3,011

78,674 83,612 76,638

~~16.~~

~~Commitments and contingencies~~As part of the commitments made in relation to the above debt, the Company must comply with the following financial ratios listed below:

~~(a)~~i.

~~Environmental matters -~~Total Net Debt to EBITDA Ratio: The Company shall not permit the Total Net Debt to EBITDA Ratio on the last day of any fiscal quarter to exceed 4.75 to 1 (3.5 to 1 in 2014).

ii.

Interest Coverage Ratio: The Company shall not permit the Interest Coverage Ratio on the last day of any fiscal quarter to be less than 3.0 to 1.

The ~~Company’s mining and exploration activities are subject~~financial ratios mentioned above apply to ~~environmental protection standards. In order to comply with these standards,~~financial statements of the Company, ~~has obtained~~which should be calculated as of each quarter ending in March, June, September and December of each year since 2014.

As of December 31, 2015, the ~~approval for the Environment Adequacy Program (“PAMA”) and~~Company was in compliance with all of ~~the Environmental Impact Studies (EIA), required for the operation of Cerro Verde’s production unit.~~its covenants, which are monitored by Management each quarter.

(c)

As of December 31, 2015 corresponds to bank promissory notes with Banco Interbank to finance its working capital needs, with an interest rate of 1.29%. The maturity date of these notes has been renewed through February 2016.

F-179

Notes to the financial statements(continued)

(d)

In December 2014, the Company entered into shareholder loan agreements with, or affiliates of, Freeport Minerals Corporation, Compañía de Minas Buenaventura S.A.A. and SMM Cerro Verde Netherlands B.V., that are currently subordinated to the senior unsecured credit facility (described in note 12(b)). These agreements allow for borrowings up to an amount of US$800 million in aggregate. As of December 31, 2015, the Company had borrowed US$600.9 million under these loan agreements, including US$0.9 million of interest. The interest rate is currently calculated based on the LIBOR rate plus the average rate of the senior unsecured credit facility, plus 0.5% (currently 3.13%). In the event these loans are no longer subordinated to the senior unsecured credit facility, the rate would be LIBOR plus the current spread on the credit facility. The loans mature on December 22, 2019, unless at that time there is senior financing associated with the expansion project that is senior to the loans, in which case the loans mature two years following the maturity of the senior financing.

On October 14, 2003, Law N°28090 was enacted, which regulates the commitments and procedures that entities involved in mining activities must follow in order to prepare, file and implement a mine site closing plan, as well as the respective environmental

There are no guarantees that assure compliance with the plan in accordance with protection, conservation and restoration of the environment. On August 15, 2005, the regulations regarding this law were approved. During 2006, in compliance with the mentioned law, the Company completed the closing plansprovided for ~~its mine site. On October 5, 2009 the MEM issued Resolution N°203-2009 MEM – AAA, approving the mine closure plan of the Company.~~these loans.

On September 2012, the company presented to the Ministry of Energy and Mines an updated mine closure plan. Based on this new closure plan, the Company recalculated its mine closure provision (adjustment of US$ 72,512,000 to the asset and liability of the mine closure provision as of this date). See Note 7.

13.

Other provisions

(a)

This item is made up as follows:

The estimate of remediation and mine closing costs is based on studies prepared by independent consultants, who comply with the current environmental regulations. This provision corresponds mainly to the activities to be performed in order to restore the areas affected by mining activities. The main tasks to be performed include ground removal, revegetation labor and dismantling of plant and equipment.

	2015			2014
	US$(000)			US$(000)

Provision for remediation and mine closure (b)		161,270			119,948
Provision for unbilled freight and services		12,520			2,964
Other		4,675			5,317
		178,465			128,229
Less – current portion		(14,662	)		(2,964	)

Non - current portion		163,803			125,265

(b)

Provision for remediation and mine closure -

The table below presents the changes in the provision for remediation and mine closure:

	2015		2014
	US$(000)		US$(000)

Beginning balance		119,948		48,479
Accretion expense		3,985		2,537
Changes in estimates		33,803		68,840
Other adjustments		3,534		92

Final balance		161,270		119,948

Classification by maturity
Current portion		2,142		-
Non - current portion		159,128		119,948

		161,270		119,948

	~~US$(000)~~

~~Balance as of January 1, 2010~~		~~3,667~~
~~Accretion expense~~		~~180~~
~~Other adjustments~~		~~(360~~	)

~~Balance as of December 31, 2010~~		~~3,487~~
~~Accretion expense~~		~~357~~
~~Other adjustments~~		~~3,217~~

~~Balance as of December 31, 2011~~		~~7,061~~
~~Accretion expense~~		~~239~~
~~Changes in the estimates~~		~~72,512~~

~~Balance as of December 31, 2012~~		~~79,812~~F-180

Notes to the financial statements (continued)

According to the Company’s accounting policies, the provision for remediation and mine closure represents the present value of the costs that are expected to be incurred in the closure period of the operating activities of the Company. Closure budgets are reviewed regularly to take into account any significant change in the studies conducted. Nevertheless, the closure costs of mining units will depend on the market prices for the closure works required, which would reflect future economic conditions. Also, the time when the disbursements will be made depends on the useful life of the mine, which will be based on future metals prices.

~~Notes to the financial statements(continued)~~

As of December 31, ~~2012,~~2015, the future value of the provision for remediation and mine closure ~~of mining units~~ and environmental liabilities was US$~~145,881,000,~~368,753,000, which was discounted using the annual risk-free rate of ~~4.65%~~2.81%, resulting in an updated liability of US$~~79,812,000~~161,270,000 (as of December 31, ~~2011,~~2014, the future value of the provision for remediation and mine closure ~~of mining units~~ and environmental liabilities was US$~~100,481,000 and~~257,451,000, which was discounted using anthe annual risk-free rate of ~~6.19%~~2.59%, ~~which resulted~~resulting in an updated liability ~~for~~of US$~~7,061,000)~~119,948,000). The increase presented in the mine closure plan in 2012 was due to the update of costs related to the future closure of PAD 4B and additional deposits for clearing. Additionally, as a result of the Expansion Project, the useful life of the mine and exploration time has been significantly reduced. The Company considers that this liability is sufficient to meet the current environmental protection laws approved by the MEM.

~~The~~As of December 31, 2015 and 2014, the Company has issued letters of credit to Ministry of Energy and Mines amounting to US$~~12,838,000~~21,539,000 and US$14,851,000, respectively, to secure mine closure plans for its mining unit.

F-181

Notes to the financial statements (continued)

14.

Deferred income tax

(a)

The Company recognizes the effect of temporary differences between the accounting base for financial reporting purposes and the tax base. The composition of this item is made up as follows:

	January 1, 2014		Debit (credit) to the statements of comprehensive income			December 31, 2014		Debit (credit) to the statements of comprehensive income			December 31, 2015
	US$(000)		US$(000)			US$(000)		US$(000)			US$(000)

Income tax
Asset
Price adjustment of cathodes and copper concentrates		-		12,831			12,831		(4,982	)		7,849
Provision for remediation and mine closure		3,014		813			3,827		1,811			5,638
Provision for mining taxes		6,322		(3,562	)		2,760		(1,255	)		1,505
Unpaid vacations		-		2,625			2,625		(110	)		2,515
Cost of net asset: rollers and construction of tailing dam		14,258		(12,101	)		2,157		(475	)		1,682
Development costs		530		(112	)		418		(86	)		332
Difference in valuation of inventories		8,204		(8,204	)		-		-			-
Other provisions		1,573		1,437			3,010		1,740			4,750
		33,901		(6,273	)		27,628		(3,357	)		24,271

Liability
Difference in depreciation method		264,291		(50,111	)		214,180		31,490			245,670
Stripping activity asset		21,778		(4,460	)		17,318		502			17,820
Difference in valuation of inventories		-		14,331			14,331		(3,334	)		10,997
Price adjustment of cathodes and copper concentrates		5,891		(5,891	)		-		-			-
		291,960		(46,131	)		245,829		28,658			274,487

Deferred liabilities, net		258,059		(39,858	)		218,201		32,015			250,216

Supplementary Retirement Fund
Difference in depreciation method		-		2,452			2,452		410			2,862
Other minors		-		75			75		-			75
Deferred liability		-		2,527			2,527		410			2,937
Total debited to the statements of comprehensive income				(37,331	)				32,425

Total deferred income tax liability, net		258,059					220,728					253,153

F-182

Notes to the financial statements (continued)

(b)

~~Water treatment plant~~For the years ended December 31, 2015, 2014 and 2013, the income tax expense recorded differs from the result of apply the legal rate to the income before income tax of the Company, as detailed below:

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Profit before income tax		79,530			616,135			946,600
Income tax rate		32	%		32	%		30	%
Expected income tax expense		25,450			197,163			283,980
Non-deductible expenses		19,534			7,013			3,478
Special mining tax and mining royalties		(4,672	)		(16,677	)		(19,348	)
Income tax true-ups		(6,082	)		(6,985	)		-
Effect of change in income tax rate to 32% due to Tax Stability Agreement effective since 2014, note 16(a)		-			-			398
Others		(3,047	)		82			1,652
Current and deferred income tax charges to results		31,183			180,596			270,160
Mining taxes charged to results		14,599			52,116			63,178
Supplementary retirement fund charged to results		464			5,817			-

		46,246			238,529			333,338

Effective income tax		58.15	%		38.71	%		35.21	%

F-183

Notes to the financial statements (continued)

(c)

Income tax expenses (benefit) for the years ended December 31, 2015, 2014 and 2013 is shown below:

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Income tax
Current		(832	)		220,454			263,588
Deferred		32,015			(39,858	)		6,572
		31,183			180,596			270,160
Mining taxes
Current		14,599			52,116			63,202
Deferred		-			-			(24	)
		14,599			52,116			63,178

Supplementary retirement fund
Current		54			3,290			-
Deferred		410			2,527			-
		464			5,817			-
Income tax expense reported in the statements of comprehensive income		46,246			238,529			333,338

15.

Equity, net

(a)

Issued capital -

As of December 31, 2015 and 2014 the authorized, subscribed and paid-up capital in accordance with the Company’s by-laws and its related modifications was 350,056,012 common shares.

According to the shareholders agreement of July 11, 2003, the nominal value of the shares was denominated in US dollars and amounted to US$0.54 each. As a result of the capitalization of restricted earnings associated to the tax benefit (reinvestment credit), the nominal value of the share was increased to US$2.83 each in December 2009.

As of December 31, 2015 the quoted price of these shares was US$14.50 per share (US$24.00 per share as of December 31, 2014) and the daily frequency of trading is 100%, as in 2014.

(b)

Other capital reserves -

In accordance with the Peruvian Companies Act, this reserve is created through the transfer of 10% of the annual net profit up to a maximum of 20% of the paid-in capital. The legal reserve must be used to offset losses, and must be replaced with future earnings. This reserve may also be used to increase capital stock but the balance must be restored from future earnings.

(c)

Dividend distribution -

During 2015, 2014 and 2013, the Company did not pay dividends.

F-184

Notes to the financial statements (continued)

16.

Tax situation

(a)

Current tax regime -

On ~~August 2,~~February 13, 1998, the Company signed an Agreement of Guarantees and Measures to Promote Investments with the Government of Peru, under the Peruvian General Mining Law. Upon approval of the agreement, the Company had tax stability for a period of 15 years from January 1, 1999 to December 31, 2013 and was subject to the tax regulations in force at May 6, 1996.

On July 17, 2012, the Company entered into a new Agreement of Guarantees and Measures to Promote Investments with the Government of Peru, under the General Mining Law and in connection with the Expansion of Cerro Verde´s production mining unit Project. By means of this agreement, the Company is subject to the tax regulations in force at July 17, 2012. The term of this agreement is 15 years from January 1, 2014 to December 31, 2028.

By means of Law No. 30296 enacted on December 31, 2014, the Peruvian government introduced certain amendments to the Income Tax Law, effective January 1, 2015, which will be applied to the Company since the maturity of the stability agreement (January 1, 2029). The most relevant are listed below:

There will be a gradual reduction of the corporate income tax from 30% to 28% in 2015 and 2016; to 27% in 2017 and 2018; and to 26% in 2019 and thereafter;

The retained earnings or other items subject to generate taxable dividends, obtained until December 31, 2014 will be subject to a rate of 4.1%.

F-185

Notes to the financial statements (continued)

(b)

The income tax rate applicable to the Company is 32% beginning 2014 according to the new agreement mentioned above. For the years ended December 31, 2015, 2014 and 2013, the taxable income according to the tax law is calculated from the profit before income tax and profit sharing for these years, and is as follows:

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Profit before income tax		79,530			616,135			946,600
Workers’ profit sharing		(1,639	)		49,175			61,690
		77,891			665,310			1,008,290
Additions:
Fully depreciated assets		42,299			41,230			-
Price adjustment of copper cathodes and concentrates		24,529			40,097			(18,408	)
Non - deductible expenses		23,766			19,251			11,595
Expenses qualifying as assets		23,037			4,936			11,569
Adjustment of inventory in process and finished goods		9,414			(41,881	)		(16,646	)
Other additions, net		32,041			25,130			14,550

Deductions:
Deduction to due recalculation of depreciation at an annual rate of 20% and 5%		(141,014	)		(1,204	)		-
Reversion of price adjustment of copper cathodes and concentrates		(40,097	)		18,408			-
Capitalized interests		(25,057	)		(1,175	)		6,000
Special mining tax and mining royalties		(18,521	)		(43,492	)		(64,608	)
Effect of stripping cost activation		(2,255	)		11,881			(46,784	)
Special mining burden		-			(19,781	)		-
		(71,858	)		53,400			(102,732	)
Sub-total		6,033			718,710			905,558
Workers’ profit sharing (8%)		(483	)		(57,497	)		(72,445	)
Taxable income		5,550			661,213			833,113
Supplementary retirement fund		(28	)		(3,290	)		-
Taxable income		5,522			657,923			833,113
Income tax		(1,767	)		(210,535	)		(249,934	)
Prior years income taxes		2,599			(9,919	)		(13,654	)
Total current income taxes charged to results, note 14(c) (does not include mining taxes and supplementary retirement fund)		832			(220,454	)		(263,588	)

F-186

Notes to the financial statements (continued)

(c)

As described in Note 2.2(l), Law No. 29788 was enacted creating a new mining tax and royalty regime in Peru. Because the Company stabilized the tax regime in force at May 6, 1996, it was not subject to the revised royalty and special mining tax until December 31, 2013, date on which the related tax stability expired. However, the Company elected to pay a special mining burden during the remaining term of its tax stability agreement. For the years ended December 31, 2015, 2014 and 2013, the Company recorded a tax provision of US$14,599,000, US$52,116,000 and US$63,178,000 respectively,related to mining taxes.

(d)

The Tax Authority has the right to examine, and, if necessary, amend the Company’s income tax provision for the last four years. The Company’s income tax and VAT for the years 2011 through 2015 are open to examination by the tax authorities. To date, SUNAT has concluded its review of the Company’s income tax and VAT exams through the year 2010, and the Company is in the claim and appeal process for the years 2002 through 2010.

For the periods pending of examination, and due to the many possible interpretations of current legislation, it is not possible to determine whether or not future reviews will result in tax liabilities for the Company. In the event that additional taxes are payable, including interest and surcharges, as a result of the Tax Authority reviews, they will be charged to expense in the period assessed. However, in Management’s and legal advisors’ opinion, any additional tax assessment would not be significant to the financial statements.

(e)

SUNAT, the Peruvian tax authority, has assessed mining royalties on materials processed by the Company´s concentrator, which commenced operations in late 2006. These assessments cover the period December 2006 to December 2007 and the years 2008 and 2009. In July 2013, the Peruvian Tax Tribunal issued two decisions affirming assessments for the period December 2006 through December 2008. Decisions by the Tax Tribunal ended the administrative stage of the appeal procedures for these assessments.

In September 2013, the Company filed judiciary appeals related to the assessments because the Company believes that its 1998 stability agreement exempted all minerals extracted from its mining concessions from royalties, irrespective of the method used for processing those minerals. With respect to the judiciary appeal related to the assessment for the year 2008, on December 17, 2014, the Eighteenth Contentious Administrative Court rendered its decision upholding the Company’s position and nullifying SUNAT’s assessment and the Tax Tribunal´s resolution (S/106.4 million Soles). In December 2014, SUNAT and the Tax Court appealed this decision. The court’s position also invalidates all penalties and interest assessed by SUNAT for that period (S/139.7 million Soles). On January 29, 2016, the 6th Superior Justice Court nullified the decision of the Eighteenth Contentious Administrative Court. Cerro Verde will appeal the decision to the Supreme Court.

F-187

Notes to the financial statements (continued)

On October 1, 2013, SUNAT served the Company a demand for payment totaling S/492 million (approximately US$144 million based on December 31, 2015 exchange rates, including interest and penalties of US$85 million) based on the Tax Tribunal’s decisions for the period December 2006 to December 2008. As permitted by law, the Company requested, and was granted, an installment payment program that deferred payment for six months and thereafter satisfies the amount via 66 equal monthly payments. As of December 31, 2015, the Company has made payments totaling S/219 million (US$64 million based on December 31, 2015, exchange rates) under the installment program, which are presented in the long term portion of Other non- financial assets in the statement of financial position (see Note 7). Based on the results rendered by the Eighteenth Contentious Administrative Court as is described in the previous paragraph, the Company requested an injunction that was accepted by the Judiciary and implied a modification of the installment program excluding the 2008 portion through SUNAT´s resolution notified to the Company on October 29, 2015.

In July 2013, a hearing on SUNAT's assessment for 2009 was held, but no decision has been issued by the Tax Tribunal for that year. As of December 31, 2015, the amount of the assessment, including interest and penalties, for the year 2009 was S/247 million (approximately US$72 million based on December 31, 2015, exchange rates). As of December 31, 2015, the Company estimates that the total exposure associated with mining royalties for the period from December 2006 to December 2013, including accumulated interest and penalties amounted to approximately US$500 million at December 31, 2015 exchange rates.

As of December 31, 2015, no amounts were accrued for these assessments or for the amounts paid under the installment payment program because management and its external legal advisors believe the Company’s 1998 stability agreement exempted it from these royalties and believes that the resolution will be favorable to the Company and ~~a committee comprised~~any payments should be recoverable.

(f)

The Company has also received assessments from SUNAT for additional taxes (other than the mining royalty explained in (e) above), including penalties and interest. The Company has filed or will file objections to the assessments because it believes it has properly determined and paid its taxes. A summary of these assessments follows:

Year	Taxes		Penalty and Interest		Total
	US$(000)		US$(000)		US$(000)

2002 – 2005		16,037		52,800		68,837
2006		6,545		47,662		54,207
2007		12,376		17,809		30,185
2008		20,797		12,968		33,765
2009		56,198		47,719		103,917
2010		65,997		89,404		155,401
2014		5,512		-		5,512
2015		3,753		-		3,753

		187,215		268,362		455,577

As of December 31, 2015, the Company has paid US$180,741,000, (included“Non-financial – long term” in the statement of financial position) on these disputed tax assessments, which it believes is collectible. No amounts have been accrued for these assessments.

F-188

Notes to the financial statements (continued)

(g)

As of December 31, 2015 and 2014, the Company has issued letters of credit to secure tax obligations amounting to S/383,792,000 (equivalent to US$112,450,000) and S/556,446,000 (equivalent to US$186,165,000), respectively, of which S/369,281,000 and S/542,747,000 are related to mining royalties for the years 2015 and 2014, respectively.

17.

Sales of goods

(a)

For the years ended December 31, 2015, 2014 and 2013, sales of goods are made up of the following:

	2015					2014					2013
	Pounds (000)		US$(000)			Pounds (000)		US$(000)			Pounds (000)		US$(000)

Copper concentrates (b)		440,071		794,197			375,688		949,459			456,116		1,316,690
Copper cathodes (b)		104,279		259,830			125,647		393,112			103,479		342,773
Other (primarily silver and molybdenum concentrates)				65,343					130,038					152,025
				1,119,370					1,472,609					1,811,488
Less:
Contributions OEFA / OSINERGMIN (see note 2.2(i))				(3,753	)				(5,512	)				-

				1,115,617					1,467,097					1,811,488

Sales to related parties amounted to US$894,656,000 for the year ended December 31, 2015 (US$1,135,042,000 and US$1,487,186 for the years ended December 31, 2014 and 2013, respectively), which are summarized in note 22(b).

(b)

As described in note 2.2(b), the Company’s copper sales are provisionally priced at shipment date. As a result, as of December 31, 2015 and 2014, the Company had embedded derivatives recorded in its statement of financial position (see note 24). Adjustments to the provisional prices are recognized as gains and losses in sales of goods until the month of settlement. Copper concentrate and cathode sales include adjustments to the provisional sale value generated by the changes in the fair value of the embedded derivatives. These adjustments resulted in higher sales for US$7,935,000 in the year 2015 (lower sales for US$42,805,000 and higher sales for US$6,839,000 in the years 2014 and 2013, respectively).

F-189

Notes to the financial statements (continued)

(c)

The following table shows sales of goods by geographic region based for the years ended December 31, 2015, 2014 and 2013:

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Asia		770,272			883,404			1,148,607
South America (mainly Peru)		204,206			304,990			275,783
North America		79,244			113,591			114,110
Europe		65,648			170,624			272,988

		1,119,370			1,472,609			1,811,488
Less: Contributions to OEFA and OSINERGMIN		(3,753	)		(5,512	)		-

		1,115,617			1,467,097			1,811,488

(d)

Concentration of sales –

For the year 2015, 80% of the ~~civil society~~Company’s sales were to related entities (Freeport-McMoRan Corporation, Sumitomo Metal Mining Company and ~~authorities~~Climax Molybdenum). For the years 2014 and 2013, 77% and 82% of ~~Arequipa~~the Company’s sales were to these related entities.

18.

Cost of sales of goods

(a)

For the years ended December 31, 2015, 2014 and 2013, cost of sales of goods is made up of the following:

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Opening balance of finished goods (see note 8(a))		22,572			15,798			20,394
Raw materials and supplies		364,234			333,521			324,925
Depreciation and amortization		244,477			164,985			109,250
Labor (b)		148,031			125,863			157,776
Energy		118,019			91,802			73,907
Third parties services		95,087			87,458			91,984
Services provided by related parties		3,565			4,904			5,169
Workers’ profit sharing		(1,636	)		45,783			57,691
Other costs		8,087			20,462			27,740
Variance of inventories in process		(118,327	)		(70,523	)		(57,974	)
Ending balance of finished goods (see note 8(a))		(22,105	)		(22,572	)		(15,798	)

		862,004			797,481			795,064

F-190

Notes to the financial statements (continued)

(b)

Includes US$1,636,000 of workers profit sharing credit for the year ended December 31, 2015 associated with income tax true-ups (workers’ profit sharing expense of US$45,783,000 for the year ended December 31, 2014).

(c)

In compliance with corporate policies, the Company recognizes administrative costs directly to cost of production (US$19.5 million for the year ended December 31, 2015, and US$20.4 million for the year ended December 31, 2014). The effect of this policy resulted in lower cost of sales of US$3.9 million and US$3.1 million for 2015 and 2014, respectively. The accounting and presentation effects related with the application of corporate policies do not generate significant distortion for the financial statements taken as a whole.

19.

Selling expenses

For the years ended December 31, 2015, 2014 and 2013, selling expenses are made up of the following:

	2015		2014		2013
	US$(000)		US$(000)		US$(000)

Concentrate’s freight		51,842		50,507		64,683
Commissions		2,729		2,271		2,727
Cathode’s freight		1,644		1,432		1,038

		56,215		54,210		68,448

20.

Other operating expenses (income), net

(a)

For the years ended December 31, 2015, 2014 and 2013, other operating expenses (income) are made up to the following:

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Other expenses
Startup costs of new concentrate plant (b)		19,568			-			-
Tax contingencies penalties		2,796			-			317
Loss on sale / retirement / impairment of fixed assets		661			5,503			-
Other expenses		3,714			370			77

		26,739			5,873			394

Other income		(139	)		(2,244	)		(541	)

		26,600			3,629			(147	)

(b)

Corresponds to the start-up costs related to the new concentrator plant (See note 1(b)) in order to reach full production capacity, which is expected in early 2016.

F-191

Notes to the financial statements (continued)

21.

Commitments and contingencies

Commitments

(a)

Environmental matters -

The Company’s exploration activities are subject to environmental protection standards. In order to comply with these standards, the Company has obtained the approval for the Environment Adequacy Program (“PAMA”) and of the ~~Committee”) signed~~Environmental Impact Studies (EIA), required for the operation of Cerro Verde’s production unit.

On October 14, 2003, Law No. 28090 was enacted, which regulates the commitments and procedures that entities involved in mining activities must follow in order to prepare, file and implement a mine site closing plan, as well as the respective environmental guarantees that assure compliance with the plan in accordance with protection, conservation and restoration of the environment. On August 15, 2005, the regulations regarding this law were approved. During 2006, in compliance with the mentioned Law, the Company completed the closing plans for its mine site. On October 5, 2009 the MEM issued Resolution No. 302-2009 MEM – AAA, approving the mine closure plan of the Company.

On November 20, 2013 according to what is established by Law, the Company presented to the Ministry of Energy and Mines an ~~agreement~~updated mine closure plan, by means of which the Company ~~agreed~~updated its mine closure budget.

The estimate of remediation and mine closing costs is based on studies prepared by independent consultants, who comply with the current environmental regulations. This provision corresponds mainly to ~~finance and implement~~ the ~~technical studies and plans necessary to construct a fresh water treatment plant in Alto Cayma and a waste water treatment plant. The agreement established that the costs~~activities to be ~~incurred~~performed in order to restore the ~~construction~~areas affected by mining activities. The main tasks to be performed include ground removal, revegetation labor and dismantling of plant and equipment.

The Company believes that this liability is sufficient to meet the ~~drinking water treatment plant will be assumed~~current environmental protection laws approved by the ~~Company~~Ministry of Energy and ~~those of the waste water treatment plant by the municipalities of the province of Arequipa.~~

On September 18, 2009, the Company contracted with Consorcio Alto Cayma (comprised of the following companies: Befesa, Graña y Montero and Aguas de Sevilla) for the design, construction and commissioning of the water treatment plant.

On July 26, 2012, through Municipal Agreement 104-2012, the Company formally transferred the water treatment plant (“PTAP II”) to the Municipality of the province of Arequipa as a public infrastructure project.Mines. See note 13(b).

~~(c)~~(b)

Construction of the Waste Water Treatment Plant

During 2011, the Company completed the feasibility study for a major expansion of its ~~concentrator~~Production Unit Cerro Verde (hereinafter “the Expansion”) which includes, among others, the expansion and improvements of facilities and mining process, flotation and leaching facilities, as well as expanding them to build a concentrator, a tailings dam and an additional leaching platform (see note 1(b)). As a result, the Company determined that the project will require the use of additional water resources apart from those currently used in the ~~concentrator plant. In order to~~operations.

To carry out ~~the project,~~this investment in its production unit, the Company ~~has offered, to~~agreed with the authorities of Arequipa ~~as part~~and SEDAPAR (Arequipa Sanitation Service), within the framework of the ~~Expansion Project,~~expansion, to develop and finance the engineering, construction and operation during the first two years of the Waste Water Treatment Plant (WWTP) and all its components, the same that will be used as a water source for expanded operations, supplementing the existing water resources to support the expansion.

F-192

Notes to the financial statements (continued)

The Company is responsible for the operation and maintenance cost of the waste water treatment plant (the plant), the drive line to the plant and the effluent discharge line. The Company will perform the operation and maintenance of the plant until the earlier of:

(i)

A new legal framework grant commercialization of the residual water treated or for the water treatment service by the companies that provide sanitation services, and both parties agrees on the amount to be paid by the Company to SEDAPAR;

(ii)

Establishment of a fee payment, compensation or other right for the water re-use and/or water treatment under the satisfaction of both parties; or

(iii)

Expiration of the agreement or its extensions.

In August 2013, the Ministry of Housing, Construction and Sanitation approved the environmental and social impact assessment of the waste water treatment plant.

As of December 31, 2015, the construction of the waste water treatment ~~plant.~~plant was completed with a total investment of S/1,300 million Soles (US$382 million based at December 31, 2015 exchange rate).

In addition to allowing for the viability of the Company’s production unit expansion project, the waste water treatment plant will also benefit the population of Arequipa as it will help to decontaminate the waters of the Rio Chili, and improve the quality of the agricultural products and the environment in general. The waste water treatment plant is expected to start full operations in early 2016.

(c)

Letter of guarantees –

During years 2015 and 2014, the Company signed letters of guarantee with Banco de Credito de Peru, Scotiabank and BBVA Banco Continental as follows:

	2015		2014
	US$(000)		US$(000)

Tax obligations, note 16(g)		112,450		186,165
Mine closure, note 13(b)		21,539		14,851
Third party obligations		23,564		20,914
Custom taxes		12,575		9,691

		170,128		231,621

F-193

Notes to the financial statements(continued)

In September 2011, the Company reached an agreement with the Regional Government and the Service of Potable Water and Serewage of Arequipa S.A. (SEDAPAR), to finance as part of the expansion project, the engineering and construction of the waste water treatment plant of Arequipa, which will be used by the Company to supplement existing water supplies to support the potential concentrator expansion. In December 2012, the Company received approval of the Environmental Impact Study from the Peruvian Ministry of Energy and Mines.

~~(d)~~

~~Construction of Bamputañe Dam -~~

On December 29, 2004, the Company signed an electric power supply agreement with Empresa de Generación Eléctrica de Arequipa S.A. (“EGASA”) for attending part of its mining operations. Under this agreement, EGASA committed to supply electricity at a fixed commodity price for the period January 1, 2007 to December 31, 2015, and the Company committed to construct the Bamputañe Dam located in the Santa Lucía district, in the province of Lampa, in the department of Puno, Peru. At that date, the construction budget related to the project was estimated to be US$5,000,000. On June 11, 2008, EGASA and the Company signed an addendum to the contract for the construction of the Bamputañe Dam, in which the parties recognized and declared that the Bamputañe Dam construction budget would be significantly higher than amount estimated initially. The updated construction budget was estimated at approximately US$14,000,000.

On December 1, 2009, the Company formally transferred the Bamputañe Dam to EGASA, and the final cost of the dam amounted to US$11,390,000. This agreement allows the Company to obtain electrical energy at a fixed rate during a period of nine years. Accordingly, the Company recognized a future economic benefit and disbursements related to the construction of the Bamputañe Dam as an intangible asset in the statement of financial position, which is being amortized over the nine year term of the contract.

As of December 31, 2012, the Company’s intangible asset, net of its amortization, for the future benefit of the supply of electrical energy at fixed prices is US$4,890,000 (US$6,519,000 as of December 31, 2011. During years 2012 and 2011, the Company recognized an amount of US$1,630,000 for each year related to the amortization in the statements of comprehensive income.

~~(e)~~

~~Voluntary contribution of 3.75% of net income -~~

On December 21, 2006, the Peruvian Government released Supreme Decree 071-2006-EM regulating the terms and conditions under which a voluntary contribution would be paid annually by mining companies in Peru. Under this regulation, the Peruvian government established the requirements for the agreements that would be negotiated individually by the mining companies. This regulation established that the contribution:

~~Notes to the financial statements(continued)~~

~~(i)~~

~~Was equivalent to 3.75% of net income,~~

~~(ii)~~

~~Was paid for 2006 and the subsequent four years, dependent on the level of international metal prices, and~~

~~(iii)~~

~~Was not tax deductible.~~

~~The rate of the voluntary contribution was broken down as follows:~~

~~2.75% for the Local Mining Fund~~

~~1.00% for the Regional Mining Fund~~

On November 8, 2007 the Company signed the contract of voluntary contribution with the Peruvian State, which complied with the requirements described previously and covered the five year period from 2006 through 2010. Total voluntary contributions paid by the company under this contract were US$146,859,000 (which included contributions of US$41,081,000 for the year 2010 which has been reflected in operating expenses in the statements of comprehensive income).

Through Supreme Decree 071-2006-ME, this contract expired, and, therefore the Company did not recognize any voluntary contributions expense for the years 2012 and 2011. In Management’s opinion, the Company has met all requirements set in the mentioned Supreme Decree 071-2006-ME and has no further obligations or commitments.

~~17.~~22.

Transactions with related parties

(a)

~~On June 1, 2005,~~During this year, the Company ~~and~~received from Minera ~~Freeport–McMoRan~~Freeport McMoran South America ~~S.A.C. signed an agreement where Minera Freeport–McMoRan South America S.A.C.~~Ltda. consulting and professional services related to finance, logistics, legal, environmental, corporate affairs , IT and human resources, which are made in Chile. As of December 31, 2015, the amount incurred by the Company for these services was ~~appointed as the general manager of the Company. Charges for management services,~~US$3,000,462, which ~~are~~has been recognized in the ~~statements~~statement of comprehensive income ~~amounted to US$18,210,000 for the year 2012~~ (US$~~20,003,000~~4,489,000 as of December 31, 2014 and US$~~17,850,000 for the years 2011 and 2010, respectively)~~5,169,000 as of December 31, 2013). ~~See note 14.~~

~~Notes to the financial statements(continued)~~

(b)

During the years ended December 31, ~~2012, 2011~~2015, 2014 and ~~2010,~~2013, the Company recognized the following sales of goods to related parties:

	2012		2011		2010
	US$(000)		US$(000)		US$(000)		2015		2014		2013
							US$(000)		US$(000)		US$(000)
Sales of goods to related parties
Freeport-McMoRan Corporation (c)		845,417		1,004,362		1,044,811
Parent Company:
FMC (c)								513,862		560,211		775,775

Other related parties:
Sumitomo Metal Mining Company, Ltd. (d)		693,945		729,446		716,740		344,334		475,609		598,023
Climax Molybdenum Marketing Corporation (e)		91,859		143,098		106,682		36,460		99,222		113,388

Total revenues		1,631,221		1,876,906		1,868,233		894,656		1,135,042		1,487,186

(c)

On October 15, 2006, the Company signed a long-term contract with FMC through in which it committed to sell 20% of its annual copper concentrate production from its primary ~~sulphide processing~~concentrator plant. Terms of the contract are reviewed annually. For the year ~~2012,~~2015, the sales of concentrate copper to FMC amounted to US$~~746,721,000~~394,349,000 (US$~~689,813,000~~445,756,000 in 2014 and US$~~725,863,000~~687,655,000 in ~~2011 and 2010, respectively)~~2013).

The Company also sells copper cathodes based on availability. According to the terms of the sales of copper cathodes to FMC, agreements are made for each shipment. For the year 2012, sales of copper cathodes to FMC amounted to US$98,696,000 (US$314,549,000 and US$318,948,000 in 2011 and 2010, respectively).

The Company also sells copper cathodes based on availability. According to the terms of the sales of copper cathodes to FMC, agreements are made for each shipment. For the year 2015, sales of copper cathodes to FMC amounted to US$119,513,000 (US$114,455,000 in 2014 and US$88,120,000 in 2013).

(d)

On June 1, 2005, the Company signed a long-term agreement with Sumitomo Metal Mining Company Ltd., in which it committed to sell 50% of its annual copper concentrate production from its ~~primary sulphide processing~~concentrator plant, through December 31, 2016. Contract terms are revised annually.

(e)

~~On October 1, 2006,~~In November, 2014, the Company ~~signed~~renewed a long-term agreement with Climax Molybdenum Marketing Corporation, a wholly owned subsidiary of FMC, in which it committed to sell 100% of its annual molybdenum concentrate production, at a price based on~~the~~Metals Week Dealer Oxide price and under a delivery type known as CIF (cost, insurance and freight). ~~Terms of the contract are reviewed annually.~~

~~(f)~~

As a result of sales of goods to related parties, the Company had trade accounts receivable from related parties and also has the following trade payables to related parties as of December 31, 2012 and 2011:

~~F-182~~

F-194

Notes to the financial statements(continued)

2012 2011
US$(000) US$(000)

Accounts receivable from related parties
Freeport - McMoRan Corporation 203,644 91,582
Sumitomo Metal Mining Company, Ltd. 108,507 104,581
Climax Molybdenum Marketing Corporation 6,411 3,168

318,562 199,331

Accounts payable to related parties
Freeport - McMoRan Corporation 3,844 871
Minera Freeport – McMoRan South America S.A.C. 2,795 1,103
Freeport - McMoRan Sales Company 1,442 1,424
Freeport McMoRan South America Inc. Chilean Agency - 17

8,081 3,415

(f)

Short-term and long-term employee benefits are recognized as expenses during the period earned. Benefits received by key management personnel represent 1.76% of total revenues for 2015 (0.66% and 1.37% of total revenues for 2014 and 2013, respectively). As of December 31, 2015 and 2014, the Company had granted stock option and/or restricted stock unit benefits to certain key management personnel, the amounts of which are not significant as of December 31, 2015 and 2014. The Company does not have other long-term benefits.

(g)

As a result of transactions with related parties, the Company had accounts receivable and also has the following payables as of December 31, 2015 and 2014:

	2015			2014
	US$(000)			US$(000)

Accounts receivable from related parties
Parent Company:
FMC		180,024			78,638

Other related parties:
Sumitomo Metal Mining Company, Ltd.		19,344			107,464
Climax Molybdenum Marketing Corporation		-			1,838
		199,368			187,940
Accounts payable to related parties
Parent Company:
FMC		14,435			14,694

Other related parties:
Freeport - McMoRan Sales Company		1,684			1,052
Climax Molybdenum Marketing Corporation		1,064			-
Minera Freeport McMoran South America Ltda.		901			1,765
Sociedad Contractual Minera El Abra		535			10
Freeport Cobalt OY		141			-
Freeport McMoRan South America S.A.C.		132			32
Accounts payable to related parties		18,892			17,553
Less: Long-Term Accounts payable to related parties		(6,850	)		(5,643	)
Short-Term Accounts payable to related parties		12,042			11,910

Terms and transaction with related parties -

Transactions with related parties are made at normal market prices.Outstanding balances at year-end are unsecured, interest free and settlement occurs in cash. There have been no guarantees received or provided for any accounts receivable or payable to related parties.As of December 31, ~~2012~~2015 and ~~2011,~~2014,the Company had not recorded any impairment of accounts ~~receivables~~receivable from related parties.

F-195

Notes to the financial statements (continued)

~~18.~~23.

Earnings per share

Basic and diluted earnings per share are computed by dividing net earnings for the period by the weighted average number of shares outstanding during the ~~year. Basic and diluted earnings per share have been determined~~year as follows:

	2012		2011		2010		2015		2014		2013

Net profit for the year		US$772,070,000		US$1,078,399,000		US$1,074,393,000	US$33,284,000		US$377,606,000		US$613,262,000
Weighted average number of shares outstanding		350,056,012		350,056,012		350,056,012		350,056,012		350,056,012		350,056,012
Basic and diluted earnings per share		US$2.21		US$3.08		US$3.07	US$0.10		US$1.08		US$1.75

F-196

~~Basic and diluted earnings per share are calculated by dividing the net profit of the period by the weighted-average number of outstanding shares for the year.~~

Notes to the financial statements(continued)

~~19.~~24.

Embedded derivative

As is indicated in ~~note 2.3~~Note 2.2 (b), the exposure to the risk of changes in the market prices of copper and molybdenum is considered as an embedded derivative and it is related to the commercial contracts. As of December 31, ~~2012~~2015 and ~~2011,~~2014, provisional prices of the estimated future prices (in copper and molybdenum pounds) and their final maturity periods were as ~~follow:~~follows:

As of December 31, 2012

As of December 31, 2015

Pounds payable
(000)

Maturity

Provisional
pricing

Forward
pricing

Fair
value

Pounds payable (000)

Maturity

Provisional
pricing

Forward
pricing

Fair
value

US$

US$(000)

US$

US$(000)

Copper:

Concentrate

218,571

January – May 2013

Between 3.398 and 3.611

Between 3.589 and 3.602

11,583

221,659

January 2016 to May 2016

Between 2.076 and 2.433

Between 2.134 and 2.138

(19,696

)

Cathode

3,970

January 2016

2.08

2.14

233

Molybdenum

3,125

January – February 2013

Between 10.853 and 13.222

Between 10.963 and 11.800

(14

)

1,425

January 2016 to February 2016

Between 3.435 and 3.635

3.950

616

11,569

(18,847

)

					As of December 31, 2011								As of December 31, 2014
	Pounds payable (000)		Maturity		Provisional pricing	Forward pricing	Fair value			Pounds payable (000)		Maturity	Provisional pricing	Forward pricing	Fair value
					US$	US$	US$(000)						US$	US$	US$(000)

Copper:
Concentrate		234,084		January - April 2012	Between 3.156 and 4.410	Between 3.156 and 3.449		(68,638	)		137,906	January 2015 to April 2015	Between 2.934 and 3.193	Between 2.855 and 2.880		(26,522	)
Cathode		4,247		January 2012	Between 3.449 and 3.489	Between 3.445 and 3.447		11			3,749	January 2015	2.898	2.88		(70	)
Molybdenum		6,381		January – February 2012	Between 12.159 and 15.501	Between 12.182 and 15.501		(6,630	)		870	February 2015	8.498	8.28		(190	)

								(75,257	)							(26,782	)

The final pricing estimated by the Company as of December 31, ~~2012~~2015 and ~~2011 were~~2014 was based on LME information.

F-197

Notes to the financial statements(continued)

~~20.~~25.

Financial risk management

The Company’s activities are exposed to different financial risks, the main risks that could adversely affect the Company’s financial assets and liabilities or future cash flows are: the risk arising from changes in market prices of minerals, interest rate risk, liquidity risk, credit risk and capital risk. The Company’s financial risk management program focuses on mitigating potential adverse effects on its financial performance.

Management knows the conditions prevailing in the market and based on its knowledge and experience, reviews and manages the risks which are summarized below. Board of Directors reviews and approves the policies to manage each of these risks.

(a)

Market risk -

Commodity price risk -

The international ~~prices~~price of copper ~~and molybdenum have~~has a significant impact on the Company’s operating results. The price of copper ~~and molybdenum~~ has fluctuated historically and is affected by numerous factors beyond the Company’s control. The Company manages this risk through the use of sales commitments with customers. The Company does not hedge its exposure to price fluctuation.

Embedded derivative –

As described in note ~~2.3~~2.2 (b), the Company has price risk through its provisionally priced sales contracts, which provide final pricing in a specified future month (generally three months from the ~~arrival~~shipment date) based primarily on quoted LME monthly average prices. The Company receives market prices based on prices in the specified future period, which results in price fluctuations recorded through revenues until the date of settlement. The Company records revenues and commercial invoices at the time of shipment, based on the current LME prices, which results in an embedded derivative on the provisionally priced contracts that are adjusted to fair value through revenues each period, using the period-end forward prices, until the date of final pricing. To the extent that final prices are higher or lower than what was recorded on a provisional basis, an increase or decrease in revenues is recorded at each reporting period until the date of final pricing. See note 24.

The table below summarizes the effect on profit before income tax ~~and workers’ profit sharing~~ caused by changes in the copper ~~and molybdenum~~ price. This analysis is based on the assumption that the copper price has increased or decreased by 10% while all other variables are held constant. The ~~2012~~2015 positive scenario uses prices between US$/pound ~~3.95~~2.347 to ~~3.96~~US$/ pound 2.351 (US$/pound ~~3.78~~3.140 to US$/pound ~~3.80~~3.170 in the year ~~2011)~~2014 and US$/pound 3.660 to US$/pound 3.680 in the year 2013); whereas the negative scenario uses prices between US$/~~Lb 3.23 to 3.24 (US$/~~pound ~~3.09~~1.920 to US$/pound ~~3.11~~1.924 (US$/pound 2.570 to 2.590 in the year ~~2011)~~2014 and US$/pound 2.990 to US$3.010 in the year 2013).

F-198

Notes to the financial statements(continued)

	Effect on profit before ~~before~~ income tax
	US$(000)

December 31, ~~2012~~2015
Increase in copper ~~and molybdenum~~ international ~~quotes~~quote		~~61,634~~48,187
Decrease in copper ~~and molybdenum~~ international ~~quotes~~quote		(~~61,634~~48,187	)

December 31, 2014
Increase in copper international quote		40,622
Decrease in copper international quote		(40,622	)

December 31, 2013
Increase in copper international quote		63,225
Decrease in copper international quote		(63,225	)

Exchange rate risk –-

As described in note ~~2.3(a)~~2.2(a), the Company’s financial statements are presented in US dollars, which is the functional and presentation currency of the Company. The Company exchange-rate risk arises mainly from deposits, taxes, ~~compensation~~salaries and other accounts payable in currencies other than the US dollar, mainly ~~Nuevos~~ Soles. The Company mitigates its exposure to exchange-rate risk by carrying out almost all of its transactions in its functional currency and Management maintains only small amounts in Nuevos Soles to cover its needs in this currency (i.e., taxes and compensation).

~~During 2012,~~For the year ended December 31, 2015, the Company ~~has~~ recorded net ~~gains net~~foreign exchange losses totaling US$76 million composed by a loss of US$84 million associated with income tax, VAT credits and payments related to the Company’s royalty installment program, which is offset by income of US$8 million from exchange ~~differences~~difference derived from other items in the statement of ~~US$3,149,000~~financial position (net ~~gains~~income of US$~~1,924,000~~2.3 million in 2014 and ~~US$669,000 during the years 2011 and 2010, respectively), from the translation~~net loss of ~~balances~~US$ 1.9 million in ~~Nuevos Soles to the US dollars.~~2013).

(b)

Liquidity risk -

Liquidity risk arises from situations in which cash might not be available to pay obligations when they become ~~due.~~due at a fair cost. The Company maintains adequate liquidity by properly managing the maturities of assets and liabilities in such way that allows the Company to maintain a structural liquidity position (cash available) enabling it to meet liquidity requirements properly. ~~Cerro Verde~~The Company sells cathode and copper and molybdenum concentrates to recognized companies in the mining sector worldwide. In addition, the Company currently has the possibility to obtain funds from financial institutions and its partners if it is required to meet its contractual obligations.

F-199

Notes to the financial statements(continued)

The following tables show the liabilities, excluding taxes and accruals with the expected aging of maturity of the Company’s obligations as of December 31, ~~2012~~2015 and ~~2011:~~2014:

	On demand		Less than 3 months		3 to 12 months		1 to 5 years		Total		On demand		Less than 3 months		3 to 12 months		1 to 5 years		Total
	US$(000)		US$(000)		US$(000)		US$(000)		US$(000)		US$(000)		US$(000)		US$(000)		US$(000)		US$(000)

As of December 31, 2012
As of December 31, 2015
Trade accounts payable		-		146,354		-		-		146,354		-		432,418		-		-		432,418
Accounts payable to related parties												-		12,042		-		6,850		18,892
Other financial liabilities												-		-		43,169		2,381,995		2,425,164
Provision related to benefits to employees												-		14,572		5,964		-		20,536
Other accounts payable		-		27,671		1,265		540		29,476		-		2,112		-		-		2,112

Total		-		174,025		1,265		540		175,830		-		461,144		49,133		2,388,845		2,899,122

As of December 31, 2011
As of December 31, 2014
Trade accounts payable		-		44,177		11,773		-		55,950		-		398,070		-		-		398,070
Embedded derivate		-		74,370		887		-		75,257
Accounts payable to related parties												-		11,910		-		5,643		17,553
Other financial liabilities												-		-		50,163		402,686		452,849
Provision related to benefits to employees												-		9,706		34,706		-		44,412
Other accounts payable		-		18,239		9,851		1,298		29,388		-		2,779		-		-		2,779

Total		-		136,786		22,511		1,298		160,595		-		422,465		84,869		408,329		915,663

F-200

Notes to the financial statements(continued)

(c)

Credit Risk -

The Company’s exposure to credit risk arises from a customer’s inability to pay amounts in full when they are due and the failure of third parties in transactions of cash and cash equivalent transactions, which is limited to balances deposited in banks and financial institutions and for trade accounts receivable at the date of the statement of financial position. To manage this risk, the Company has an established treasury policy, which only allows the deposit of surplus funds in highly rated institutions, by establishing conservative credit policies and through a constant evaluation of market conditions. Consequently, the Company does not expect to incur in losses on accounts involving potential credit risks.

The concentration of credit risk also exists when economic changes occur, in industry or geography that affects third parties in the same way. The Company’s customer portfolio is primarily concentrated in three customers, which are related companies with solid financial structures.

The credit risk is limited to the book value of financial assets on the statement of financial position date, which consists mainly of cash and cash equivalents, trade accounts receivable from third parties and trade accounts receivable from related parties. The Company does not use derivative instruments to hedge its exposure to credit risk.

(d)

Capital ~~management~~risk -

The objective is to safeguard the Company’s ability to continue as a going concern in order to provide returns for shareholders and benefits for stakeholders and maintain an optimal structure that would reduce the cost of capital.

The Company manages its capital structure and makes adjustments to it, in light of changes in economic market conditions. To maintain or adjust the capital structure, the Company controls dividend payments to shareholders, the return of capital to shareholders and the issue of new shares. No changes were made in the objectives, policies or processes during the years ended December 31, ~~2012~~2015, 2014 and ~~2011.~~2013.

F-201

Notes to the financial statements (continued)

~~21.~~26.

Hierarchy and fair value of financial instruments

Hierarchy:

As of December 31,2015 and 2014,the only financial asset carried at fair value is the embedded derivative, which is generated by the sale of copper and measured at fair value based on copper prices. The value of this embedded derivative as of December 31, 2015 was a liability of US$18,847,000 (liability US$26,782,000 as of December 31, 2014). This embedded derivative is categorized within Level 2 of the hierarchy.The fair value of embedded derivatives is determined using valuation techniques using information directly observable in the market (forward prices of metals).

Fair value:

Financial instruments whose fair value is similar to their book value –

For financial assets and liabilities which are liquid or have short-term maturity (less than three months), such as cash and cash equivalent, accounts receivable, other accounts receivable, accounts payable, other accounts payable, and other current liabilities, it is estimated that their book value is similar to their fair value.

Financial instruments at fixed and variable rates –

Financial assets and liabilities with fixed or variablerates are recorded at amortized cost and fair value is determined by comparing the market interest rates at the time of their initial recognition to the current market rates with regard to similar financial instruments.

Based on the foregoing, there are no significant differences between book value and fair value of financial instruments (assets and liabilities) as of December 31, 2015 and 2014.

27.

Mineral reserves (unaudited)

As of December 31, ~~2012~~2015 and ~~2011,~~2014, the Company’s proven and probable copper mineral reserves were:

MT (000) Grade
2012 2011 2012 2011

Mineral for leaching 202,153 224,541 0.34 0.40
Mineral for milling 3,992,384 3,752,670 0.38 0.39

~~Notes to the financial statements(continued)~~

	MT (000)				Grade (percent)
	2015		2014		2015		2014

Mineral for leaching		152,566		168,380		0.35		0.37
Mineral for milling		3,703,373		3,784,854		0.38		0.38

Copper production in thousands of recoverable pounds for the years ended December 31, ~~2012~~2015 and ~~2011~~2014 was as ~~follow:~~follows:

	2012		2011		2015		2014

Cathodes		118,703		166,017		105,077		124,804
Concentrates		475,771		481,217		439,405		375,438

F-202

Notes to the financial statements (continued)

Average LME price per metric ton of copper for the years ended December 31, ~~2012~~2015 and ~~2011,~~2014, was as follows:

2012 2011
US$/MT US$/MT

Copper 7,950 8,821

	2015		2014
	US$/MT		US$/MT

Copper		5,490		6,860

28.

Summary of significant differences between accounting principles followed by the Company and U.S. generally accepted accounting principles

The Company’s financial statements have been prepared in accordance with International Financial Reporting Standards which differs in certain respects from U.S. GAAP. The effects of these differences are reflected in Note 29 and are principally related to the items discussed in the following paragraphs:

(a)

Stripping Cost – IFRIC 20

Under IFRS, the stripping cost of production that is necessary to produce the inventory is recorded as cost of production, while the one that allows access to additional amounts of reserves to be exploited in future periods are capitalized and amortized based on proved and probable reserves of each ore body (component) identified in the open pit.

Under U.S. GAAP, the costs of clearing removal (stripping cost of production) incurred during the production stage are recorded as part of the production cost of inventories.

(b)

Inventories

Under IFRS, the cost inventory includes: (i) the depreciation and amortization expense, (ii) the amortization of production-stripping costs and (iii) workers´ profit participation. Under U.S. GAAP the cost inventory excludes these items.

(c)

Deferred workers’ profit participation

Under U.S. GAAP, the workers’ profit sharing is treated in a similar way as income tax since both are calculated based on the Company’s taxable income. Therefore, the Company calculates a deferred workers’ profit participation resulting from the taxable and deductible temporary differences.

(d)

Deferred income tax –

The differences between U.S. GAAP and IFRS are re-measurements that lead to different temporary differences. According to the accounting policies in Note 2.2 (l), the Company has to account for such differences.

29.

Reconciliation between net income and shareholders' equity determined under IFRS and U.S. GAAP

The following is a summary of the main adjustments to net income for the years ended December 31, 2015, 2014 and 2013 and to shareholders' equity as of December 31, 2015, 2014 and 2013 that would be required if U.S. GAAP had been applied instead of IFRS in the financial statements:

~~F-189~~

F-203

Notes to the financial statements (continued)

	2015			2014			2013
	US$(000)			US$(000)			US$(000)

Net profit under IFRS		33,284			377,606			613,262

Items increasing (decreasing) reported net profit:
Stripping activity asset, net of amortization		(45,168	)		(4,221	)		(49,937	)
Inventories valuation		12,573			(57,744	)		25,517
Asset retirement obligation		(428	)		(654	)		(41	)
Deferred workers´ profit participation		(6,225	)		13,512			2,055
Deferred income tax		9,470			13,329			8,484
Other		591			(211	)		31

Net income under U.S. GAAP		4,097			341,617			599,371

Shareholders’ equity under IFRS	4,498,374		4,465,090		4,087,484
Items increasing (decreasing) reported shareholder’s equity:
Stripping activity asset, net of amortization	(99,326	)	(54,158	)	(49,937	)
Inventories valuation	(30,698	)	(43,271	)	14,473
Asset retirement obligation	(2,527	)	(2,099	)	(1,445	)
Deferred workers´ profit participation	(8,126	)	(1,901	)	(15,413	)
Deferred income tax	38,715		29,245		15,916
Other	266		(325	)	(114	)

Shareholders’ equity under U.S. GAAP	4,396,678		4,392,581		4,050,964

30.

New U.S. GAAP Accounting Pronouncements

Recently Issued Accounting Pronouncements -

Inventory -

Revenue recognition –

F-204

¨	~~REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g)~~
	~~OF THE SECURITIES EXCHANGE ACT OF 1934~~
	OR
x	~~ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)~~
	~~OF THE SECURITIES EXCHANGE ACT OF 1934~~
	~~For the fiscal year ended December 31, 2012~~
	OR
¨	~~TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE~~
	~~SECURITIES EXCHANGE ACT OF 1934~~
	OR
¨	~~SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d)~~
	~~OF THE SECURITIES EXCHANGE ACT OF 1934~~

Title of each class		Name of each exchange on which registered
Common shares, nominal (par) value of ten Peruvian ~~Nuevos~~ Soles per share ~~(Common Shares)~~(“Common Shares”)		New York Stock Exchange Inc.^* Lima Stock Exchange

American Depositary Shares ~~(ADSs)~~(“ADSs”) representing one Common Share each		New York Stock Exchange Inc.٭ ~~Lima Stock Exchange~~ ~~New York Stock Exchange Inc.~~

Common Shares nominal (par) value of S/.10.00 per share	274,889,924*
		~~274,889,924~~	*
Investment ~~shares~~Shares nominal (par) value of S/.10.00 per share			744,640

	As of and for the year ended December 31,
	2010⁽²⁾			2011			2012
	(In thousands of US$)⁽¹⁾
Income statement data:
IFRS⁽²⁾
Net sales		2,368,988			2,520,050			2,127,023
Total revenues		2,368,988			2,520,050			2,127,023
Costs of sales
Total costs of sales		(645,959	)		(824,700	)		(801,571	)
Gross margin		1,723,029			1,695,350			1,325,452
Operating expenses
Selling expenses		(76,638	)		(83,612	)		(78,674	)
Excess of workers’ profit sharing		(34,427	)		(21,923	)		-
Expenses related to water plant		(4,300	)		(13,670	)		(19,606	)
Voluntary contribution		(41,081	)		-			-
Other operating expenses		(10,749	)		(16,865	)		(9,898	)
Total operating expenses		(167,195	)		(136,070	)		(108,178	)
Operating income		1,555,834			1,559,280			1,217,274
Other income (expenses), net
Financial expense		(101	)		(165	)		(6,951	)
Financial income		1,261			1,078			1,886
Exchange Difference, net		669			1,924			3,149
Total other income (expenses), net		1,829			2,837			(1,916	)

Profit before income tax		1,557,663			1,562,117			1,215,358

Income tax		(483,270	)		(483,718	)		(443,288	)
Net income		1,074,393			1,078,399			772,070

Basic and diluted earnings per share		3.069			3.081			2.206
Dividends per share		2.714			-			-

Average number of shares outstanding		350,056,012			350,056,012			350,056,012

Statement of financial position data:
IFRS⁽²⁾
Total assets		2,294,078			3,196,597			4,042,771
Total debt		-			-			-
Capital stock		990,659			990,659			990,659
Shareholders’ equity		1,599,239			2,677,638			3,449,708

Operating data (unaudited):
Production:
Copper (in thousands of recoverable pounds)		667,363			647,234			594,474
Proven and probable reserves:
Copper (in thousands of metric tons)		3,571,531			3,977,211			4,194,537

Exploration Projects	Buenaventura’s Effective Participation			Principal Partners	Property Hectares		Observed Mineralization	Total Exploration Expenditures During 2010				Total Exploration Expenditures During 2011				Total Exploration Expenditures During 2012
	At March 31, 2013							Total (Buenaventura and Partners)		Buenaventura		Total (Buenaventura and Partners)		Buenaventura		Total (Buenaventura and Partners)		Buenaventura

								(US$ in millions)				(US$ in millions)				(US$ in millions)

Buenaventura’s Projects:

Breapampa⁽¹⁾		100.00	%	None		41,866	Gold & silver		1.05		1.05		4.70		4.70		0.40		0.40
Mallay⁽²⁾		100.00	%	None		7,030	Silver, lead & zinc		9.78		9.78		10.30		10.30		8.0		8.0
						99,459			12.74		11.84		15.77		15.41		1.20		1.20

Exploration Projects⁽¹⁾⁽²⁾	Buenaventura’s Effective Participation			Principal Partners	Property Hectares		Observed Mineralization	Total Exploration Expenditures During 2010				Total Exploration Expenditures During 2011				Total Exploration Expenditures During 2012
	at March 31, 2013							Total (Buenaventura and Partners)		Buenaventura		Total (Buenaventura and Partners)		Buenaventura		Total (Buenaventura and Partners)		Buenaventura

								(US$ in millions)				(US$ in millions)				(US$ in millions)

Joint Venture Projects:

Hualgayoc		50.00	%	Gold Fields		15,417	Silver, zinc & lead		0.65		0.32		2.98		1.49		3.60		1.80
Lucanas		60.00	%	Sumitomo		0	Copper & gold		0.19		0.12		-		-		—		—

	Gold				Silver
	Average Annual Market Price		Our Average Annual Price⁽¹⁾		Average Annual Market Price		Our Average Annual Price⁽¹⁾
	US$/oz. ⁽²⁾		US$/oz.		US$/oz.⁽³⁾		US$/oz.
2008		871.71		872.21		15.02		14.26
2009		972.98		988.32		14.65		15.52
2010		1,224.66		1,253.35		20.16		20.86
2011		1,568.58		1,574.45		35.11		35.36
2012		1,668.98		1,678.92		31.15		31.25
2013 (through March 31, 2013)		1,631.77		1,606.08		30.11		29.92

	Julcani		Uchucchacua		Orcopampa(1)		Recuperada		Mallay		Colquijirca(2)(6)		Marcapunta(2)		Ishihuinca		Antapite		Shila - Paula(3)		Poracota		Breapampa(6)		Tantahuatay(4) (6)		La Zanja(5) (6)		Total
Ore mined (ST)		957,120		9,239,911		4,693,309		682,640		114,166		16,397,908		5,690,763		368,511		1,611,585		634,734		1,124,909		579,115		14,845,347		23,821,022		80,761,040
Gold produced (oz.)		6,942		-		2,612,923		-		107		-		31,300		125,096		611,405		250,031		242,563		8,817		187,432		290,304		4,366,920
Average gold grade (oz./ST)		0.011		-		0.556		-		0.011		-		0.012		0.402		0.399		0.416		0.262		0.028		0.017		0.021		0.059
Silver produced (oz.)		16,266,407		101,784,006		1,458,349		3,718,219		682,708		42,636,134		2,379,792		-		667,609		2,278,745		130,660		17,212		1,179,416		788,047		173,987,304
Average silver grade (oz./ST)		18.25		14.97		0.30		5.79		6.65		3.71		0.75		-		0.60		4.36		0.15		0.50		0.52		0.31		3.05

	Proven and Probable Reserves at December 31, 2012
	Tonnage (thousands of DST)		Average Gold Grade (oz./DST)		Ounces Contained (thousands of ounces)
Maqui Maqui		10,181		0.025		254
Carachugo		11,297		0.041		459
San José		-		-		-
Giuliana		-		-		-
Marleny		8,873		0.010		91
Cerro Yanacocha		4,122		0.058		238
La Quinua		-		-		-
Tapado		-		-		-
Corimayo		48,674		0.044		2,120
La Quinua Sur		71,549		0.013		932
Cerro Negro		33,021		0.015		499
In process		33,061		0.040		1,314
Subtotal Yanacocha/avg		220,778		0.027		5,907
Subtotal Conga project/avg.*		590,855		0.021		12,582
Total/average		811,633		0.023		18,489

	Proven and Probable Reserves at December 31, 2015^ǂ
	Tonnage (thousands of DST)		Average Gold Grade (oz./DST)		Ounces Contained (thousands of ounces)
Quecher Main		96,237		0.01		1,442
Marleny		967		0.01		9
Yanacocha		3,986		0.04		152
Yanacocha Layback		41,356		0.01		490
La Quinua Sur		44,790		0.01		646
Tapado Oeste Layback		26,428		0.04		963
Cerro Negro		6,682		0.01		89
Transition Stockpile		5,295		0.03		145
Deep Transitional Stockpile		7,317		0.06		431
Gold Mill Stockpile		2,639		0.08		218
Maqui Maqui Leach Pad		519		0.04		23
Carachugo Leach Pad		1,961		0.02		34
Yanacocha Leach Pad		87		0.03		2
La Quinua Leach Pad		21,981		0.02		410
Total		260,244		0.02		5,057

Property, Plant and Equipment	Estimated Years of Useful Life

Buildings, ~~construction~~constructions and other		Between 6 and 20
Machinery and equipment		Between 5 and 10
Transportation units		5
Furniture and fixtures		10
Computer equipment		4

Average Realized Price	Year ended December 31,
	2011		2012		Variation

Gold (US$/oz.)	US$	1,574.45	US$	1,678.92		6.64	%
Silver (US$/oz.)		35.36		31.25		(11.62	)%
Lead (US$/MT)		2,262.34		2,064.65		(8.74	)%
Zinc (US$/MT)		2,199.72		1,919.04		(12.76	)%
Copper (US$/MT)		8,567.64		7,937.08		(7.36	)%

Volume Sold	Year ended December 31,
	2011		2012		Variation

Gold (oz.)		505,894		439,816		(13.06	)%
Silver (oz.)		14,843,193		17,474,113		17.72	%
Lead (MT)		18,192		25,589		40.66	%
Zinc (MT)		33,307		43,180		29.64	%
Copper (MT)		23,231		22,373		(3.69	)%

Mining Segment	Volume Sold for the year ended December 31, 2015
	Gold (oz.)		Silver (oz.)		Lead (t)		Zinc (t)		Copper (t)
Julcani		94		3,493,166		2,478		-		103
Mallay		396		1,134,528		6,612		7,482		-
Breapampa		16,069		212,826		-		-		-
Orcopampa		214,821		555,314		-		-		-
Uchucchacua		38		12,666,673		6,560		4,750		-
La Zanja		142,300		324,151		-		-		-
Colquijirca		7,181		2,637,215		16,739		43,297		28,991

Mining Segment	2015 vs 2014 Change (%)
	Gold (oz.)			Silver (oz.)			Lead (t)			Zinc (t)			Copper (t)
Julcani		683	%		23	%		20	%		-			61	%
Mallay		100	%		1	%		(9	)%		(13	)%		-
Breapampa		(80	)%		(45	)%		-			-			-
Orcopampa		5	%		38	%		-			-			-
Uchucchacua		100	%		6	%		-			11	%		-
La Zanja		(1	)%		(23	)%		-			-			-
Colquijirca		(9	)%		37	%		507	%		441	%		(28	)%

Mining Segment	2014 vs 2013 Change (%)
	Gold (oz.)			Silver (oz.)			Lead (t)			Zinc (t)			Copper (t)
Julcani		(97	)%		28	%		20	%		-			(54	)%
Mallay		-			(2	)%		10	%		13	%		-
Breapampa		0	%		23	%		-			-			-
Orcopampa		(7	)%		(22	)%		-			-			-
Uchucchacua		-			22	%		(6	)%		(32	)%		-
La Zanja		8	%		10	%		-			-			-
Colquijirca		70	%		32	%		(67	)%		(60	)%		59	%

			Payments due by Period (US$ in millions)								Payments due by Period (US$ in millions)
			Less than		1-2		2-5		More than		Total		Less than 1 year		1-2 years		2-5 years		More than 5 years
	Total		1 year		years		years		5 years
Long-Term Debt (principal and interest)^(*)		188.5		6.1		29.8		29.7		122.9
Capital Lease Obligations		-		-		-		-		-
Long-Term Debt (principal and interest)												–		–		–		–		–
Capital Lease Obligations (*)												414.6		47.9		92.5		274.2		–
Open Purchase Orders		-		-		-		-		-		–		–		–		–		–
Other Long-Term Obligations		-		-		-		-		-		–		–		–		–		–
Total Contractual Cash Obligations		188.5		6.1		29.8		29.7		122.9		414.6		47.9		92.5		274.2		–

	For the year ended December 31,
	2014		2015
	(in thousands of US$)
Consolidated Cost of sales excluding depreciation and amortization		614,539		590,405
Add:
Consolidated Exploration in units in operation		97,853		91,520
Commercial Deductions		184,483		196,211
Consolidated Selling expenses		16,605		19,481
Consolidated Cost applicable to sales		913,480		897,618

	For the year ended December 31,
Exploration in units in operation by mine and mineral	2014		2015
	(US$ in thousands)
Julcani, Gold		2		25
Julcani, Silver		10,072		11,598
Julcani, Lead		824		956
Julcani, Copper		83		121
Mallay, Gold		0		77
Mallay, Silver		2,942		3,073
Mallay, Lead		2,155		1,990
Mallay, Zinc		2,711		2,399
Breapampa, Gold		463		1,554
Breapampa, Silver		32		267
Orcopampa, Gold		50,378		40,307
Orcopampa, Silver		1,438		1,358
Uchucchacua, Gold		1		6
Uchucchacua, Silver		24,125		25,222
Uchucchacua, Lead		1,482		1,453
Uchucchacua, Zinc		1,026		1,103
La Zanja, Gold		115		11
La Zanja, Silver		5		0
El Brocal, Gold		0		0
El Brocal, Silver		0		0
El Brocal, Lead		0		0
El Brocal, Zinc		0		0
El Brocal, Copper		0		0
Non Mining Units		0		0
Consolidated Exploration in units in operation		97,853		91,520

	For the year ended December 31,
Commercial Deductions in units in operation by mine and mineral	2014		2015
	(US$ in thousands)
Julcani, Gold		2		14
Julcani, Silver		6,148		7,258
Julcani, Lead		502		591
Julcani, Copper		53		81
Mallay, Gold		0		89
Mallay, Silver		3,687		4,098
Mallay, Lead		2,620		2,655
Mallay, Zinc		5,153		4,313
Breapampa, Gold		99		62
Breapampa, Silver		0		5
Orcopampa, Gold		288		255
Orcopampa, Silver		1		0
Uchucchacua, Gold		0		7
Uchucchacua, Silver		35,786		37,753
Uchucchacua, Lead		2,248		2,161
Uchucchacua, Zinc		3,850		5,457
La Zanja, Gold		240		194
La Zanja, Silver		4		18
El Brocal, Gold		3,777		4,847
El Brocal, Silver		12,345		13,583
El Brocal, Lead		1,317		6,669
El Brocal, Zinc		4,105		24,622
El Brocal, Copper		102,258		81,479
Non Mining Units		0		0
Consolidated Commercial Deductions in units in operation		184,483		196,211

	For the year ended December 31,
Selling expenses by mine and mineral	2014		2015
	(US$ in thousands)
Julcani, Gold		0		2
Julcani, Silver		979		963
Julcani, Lead		80		79
Julcani, Copper		8		10
Mallay, Gold		0		15
Mallay, Silver		661		580
Mallay, Lead		484		376
Mallay, Zinc		609		453
Breapampa, Gold		367		99
Breapampa, Silver		26		17
Orcopampa, Gold		929		823
Orcopampa, Silver		27		28
Uchucchacua, Gold		0		1
Uchucchacua, Silver		3,099		3,228
Uchucchacua, Lead		190		186
Uchucchacua, Zinc		132		141
La Zanja, Gold		1,382		1,172
La Zanja, Silver		59		36
El Brocal, Gold		204		255
El Brocal, Silver		722		1,258
El Brocal, Lead		120		912
El Brocal, Zinc		379		2,522
El Brocal, Copper		5,677		4,110
Non Mining Units		470		2,217
Consolidated Selling expenses		16,605		19,481

	NON-MINING UNITS
	TOTAL
	For the year ended December 31,
	2014		2015
	(US$ in thousands)
Cost of Sales, excluding depreciation and amortization		69,011		38,246
Add:
Exploration in units in operation		0		0
Commercial Deductions		0		0
Selling expenses		470		2,217
Total Cost applicable to sales		69,481		40,463

Mine(1)	2012		2011		2015		2014
	(ounces)				(ounces)
Cerro Yanacocha		662,577		659,996		52,020		30,713
Carachugo		300,368		319,995		89,635		286,062
Maqui Maqui		5,811		9,906		47,712		5,669
La Quinua		377,236		303,226		728,324		647,500
Total		1,345,992		1,293,123		917,691		969,944

	2015			2014

Exploration and advance project	$	64,223		$	58,880
Severance program		14,904			16,438
Disposal of fixed assets		(135	)		13,530
Other expenses		(671	)		(6,149	)
Others, net		4,525			(4,918	)
	$	82,846		$	77,781

Name	Age	Position	Date First Appointed	Current Term Ends	Age	Position	Date First Appointed	Current Term Ends
Directors
Roque Benavides	58	Chairman of the Board	1980	March 2014	61	Chairman of the Board	1980	March 2017
Timothy Snider	63	Director	2011	March 2014
Jose Miguel Morales⁽¹⁾	67	Director	2012	March 2014	70	Director	2012	March 2017
Aubrey Laurence Paverd	74	Director	2002	March 2014
Igor Gonzales					61	Director	2014	March 2017
Felipe Ortiz-de-Zevallos	65	Director	2003	March 2014	68	Director	2003	March 2017
Carlos del Solar	72	Director	2011	March 2014	75	Director	2011	March 2017
Germán Suárez	71	Director	2005	March 2014	74	Director	2005	March 2017
William Champion⁽²⁾					62	Director	2016	March 2017

Executive Officers
Roque Benavides⁽¹⁾	58	President and Chief Executive Officer	2001		61	President and Chief Executive Officer	2001
Carlos E. Gálvez	60	Vice President and Chief Financial Officer	2001		62	Vice President and Chief Financial Officer	2001
Raúl Benavides⁽¹⁾	57	Business Development Vice President	1997		60	Vice President Business Development	2014
Alejandro Hermoza	51	Vice President Community Relations	2008		54	Vice President Community Relations	2008
Francois Muths	61	Operations Vice President	2007
César E. Vidal	58	Explorations Vice President	1996
Igor Gonzales					64	Vice President Operations	2014
Gulnara la Rosa	48	General Counsel	2012		51	General Counsel	2012
Leandro Garcia	44	General Comptroller and Compliance Officer	2011		47	General Comptroller and Compliance Officer	2011

Shareholder	Number of Common Shares		Percentage Beneficial Ownership of Common Shares			Number of Investment Shares		Percentage Beneficial Ownership of Investment Shares		Number of Common Shares and Investment Shares		Percentage Beneficial Ownership of Common Shares and Investment Shares			Number of Common Shares		Percentage Beneficial Ownership of Common Shares		Number of Investment Shares		Percentage Beneficial Ownership of Investment Shares		Number of Common Shares and Investment Shares		Percentage Beneficial Ownership of Common Shares and Investment Shares

Roque Benavides†		365,398		0.14			—		—		365,398		0.14			13,912,006		5.48						13,912,006		5.47
Timothy Snider		—		—			—		—		—		—
William Champion																—		—		—		—		—		—
José Miguel Morales†		267,228		0.11			—		—		267,228		0.11			13,813,836		5.44						13,813,836		5.43
Aubrey Laurence Paverd		—		—			—		—		—		—
Igor Gonzalez																—		—		—		—		—		—
Felipe Ortiz-de-Zevallos		—		—			—		—		—		—			—		—		—		—		—		—
Carlos del Solar		—		—			—		—		—		—			—		—		—		—		—		—
Germán Suárez		—		—			—		—		—		—			—		—		—		—		—		—
Raúl Benavides†		267,228		0.11			—		—		267,228		0.11			13,813,836		5.44				—		13,813,836		5.43
Carlos E. Gálvez.		48,770		0.02			—		—		48,770		0.02			48,770		0.02		—		—		48,770		0.02
Alejandro Hermoza		—		—			—		—		—		—			—		—		—		—		—		—
Francois Muths		—		—			—		—		—		—
César E. Vidal		—		—			—		—		—		—
Gulnara la Rosa		—		—			—		—		—		—			—		—		—		—		—		—
Leandro Garcia		—		—			—		—		—		—			—		—		—		—		—		—

Directors and Executive Officers as a Group†		948,624		0.37	%		—		—		948,624		0.37	%		41,588,448		16.39						41,588,448		16.36

Shareholder	Number of Common Shares		Percentage Beneficial Ownership of Common Shares ⁽¹⁾⁽²⁾		Number of Investment Shares		Percentage Beneficial Ownership of Investment Shares ⁽¹⁾⁽³⁾		Number of Common Shares and Investment Shares		Percentage Beneficial Ownership of Common Shares and Investment Shares ⁽¹⁾⁽⁴⁾

Benavides Family⁽⁵⁾		69,187,744		27.27		—		—		69,187,744		27.2
Market Vectors ETF Trust Gold Miners ETF		16,866,914		6.1		—		—		16,866,914		6.1
Templeton Asset Management Ltd. Hong Kong		8,542,95		3.1		—		—		8,542,957		3.1
BlackRock Investment Management (UK) Ltd.		7,933,466		2.9		—		—		7,933,466		2.9

Year ended December 31,⁽¹⁾	Per Common Share						Per ADSs						Per Investment Share
	Interim		Final		Total		Interim		Final		Total		Interim		Final		Total
2008		0.09		0.02		0.11		0.09		0.02		0.11		0.09		0.02		0.11
2009		0.02		0.14		0.16		0.02		0.14		0.16		0.02		0.14		0.16
2010		0.30		0.16		0.46		0.30		0.16		0.46		0.30		0.16		0.46
2011		0.33		0.23		0.56		0.33		0.23		0.56		0.33		0.23		0.56
2012		0.40		0.20		0.60		0.40		0.20		0.60		0.40		0.20		0.60

	Common Shares⁽¹⁾						ADSs⁽²⁾						Investment Shares⁽¹⁾
	Trading Volume		High		Low		Trading Volume		High		Low		Trading Volume		High		Low
	(in millions)		(in nominal S/. per share)				(in millions)		(in US$ per ADS)				(in millions)		(in nominal S/. per share)
Annual highs and lows

2008		1.63		118.75		33.00		274.92		42.89		9.00		0.02		90.00		40.00
2009		2.53		122.00		45.05		345.53		42.69		14.00		0.61		90.00		40.00
2010		1.44		155.50		83.00		271.37		57.20		28.59		0.04		110.00		78.00
2011		2.50		136.00		98.72		323.07		49.53		35.33		0.02		110.00		98.00
2012		2.15		117.00		82.55		236.28		43.90		30.86		0.22		109.30		75.00

Quarterly highs and lows

2011
1st quarter		0.22		136.00		113.00		75.72		49.53		39.30		0.01		110.00		100.00
2nd quarter		0.87		121.80		99.10		101.09		44.78		35.33		0.01		100.00		100.00
3rd quarter		0.71		134.10		100.40		82.42		49.45		36.12		0.01		105.00		98.00
4th quarter		0.70		123.00		98.72		63.84		45.80		35.58		0.00		104.60		101.40

2012
1st quarter		0.52		117.00		99.50		54.58		43.90		37.71		0.01		109.30		99.50
2nd quarter		0.52		113.00		93.50		67.42		43.04		35.03		0.22		110.00		89.42
3rd quarter		0.22		95.00		86.00		59.88		40.09		31.05		0.00		77.00		77.00
4th quarter		0.90		100		82.55		54.42		39.28		30.86		0.01		77.00		75.00

Monthly highs and lows

2012
October		0.02		100.00		90.90		13.97		39.28		34.56		0.00		77.00		77.00
November		0.84		93.55		83.00		19.06		37.52		32.00		0.01		77.00		77.00
December		0.05		92.50		82.55		21.39		36.27		30.86		0.01		75.00		75.00
2013
January		0.34		90.09		75.25		27.25		36.58		29.50		0.00		0.00		0.00
February		0.20		76.30		65.00		27.72		30.42		25.42		0.00		0.00		0.00
March		0.07		67.31		63.80		27.40		26.59.59		24.00		0.00		0.00		0.00

	Common Shares⁽¹⁾						ADSs⁽²⁾						Investment Shares⁽¹⁾
	Trading Volume		High		Low		Trading Volume		High		Low		Trading Volume		High		Low
	(in millions)		(in nominal S/. per share)				(in millions)		(in US$ per ADS)				(in millions)		(in nominal S/. per share)
Annual highs and lows

2012		2.14		117.00		82.55		236.34		43.90		30.86		0.22		109.30		75.00
2013		2.06		90.99		29.70		472.08		36.58		10.54		0.00		30.00		30.00
2014		0.44		39.80		28.11		467.73		14.82		8.64		0.001		26.00		26.00
2015		1.31		38.8		14.35		409.75		12.37		3.88		-		-		-

Quarterly highs and lows

2014
1st quarter		0.22		39.00		31.45		136.12		14.12		11.08		0.001		26.00		26.00
2nd quarter		0.04		38.00		28.11		111.12		13.88		9.75		-		-		-
3rd quarter		0.15		39.80		29.40		93.37		14.82		10.71		-		-		-
4th quarter		0.02		34.00		29.40		127.130		12.28		8.64		-		-		-

2015
1st quarter		0.25		35.51		31.00		106.07		11.74		9.67		-		-		-
2nd quarter		0.46		38.80		32.55		83.37		12.37		10.38		-		-		-
3rd quarter		0.41		32.10		18.50		107.61		10.15		5.80		-		-		-
4th quarter		0.20		25.46		14.00		112.68		8.22		3.88		-		-		-

Monthly highs and lows

2015
October		0.071		25.46		19.43		41.49		8.22		6.09		-		-		-
November		0.124		21.26		15.78		39.01		6.41		4.50		-		-		-
December		0.003		14.35		14.00		32.68		5.01		3.88		-		-		-
2016
January		0.003		12.05		12.05		27.98		4.44		3.38		-		-		-
February		0.084		19.17		15.60		45.36		5.49		4.14		-		-		-
March		0.024		24.66		17.22		14.06		7.38		5.06		-		-		-

Persons depositing or withdrawing shares must pay:	For:

US$5.00 (or less) per 100 ADSs (or portion of 100 ADSs)	•	Issuance of ADSs, including issuances resulting from a distribution of shares or rights or other property

	•	Cancellation of ADSs for the purpose of withdrawal, including if the deposit agreement terminates

A fee equivalent to the fee that would be payable if securities distributed to you had been shares and the shares had been deposited for issuance of ADSs	•	Distribution of securities distributed to holders of deposited securities which are distributed by the depositary to ADS registered holders

Registration or transfer fees	•	Transfer and registration of shares on our share register to or from the name of the Depositary or its agent when you deposit or withdraw shares

Expenses of the Depositary	•	Cable, telex and facsimile transmissions (when expressly provided in the deposit agreement)

	•	Converting foreign currency to U.S. Dollars

Taxes and other governmental charges the Depositary or the custodian have to pay on any ADS or share underlying an ADS, for example, stock transfer taxes, stamp duty or withholding taxes	•	As necessary

Any charges incurred by the Depositary or its agents for servicing the deposited securities	•	As necessary

			Page

(a)	Index to Financial Statements and Schedules

COMPAÑIAÍA DE MINAS BUENAVENTURA S.A.A. AND SUBSIDIARIES		F-1

MINERA YANACOCHA S.R.L.		F-99

SOCIEDAD MINERA CERRO VERDE S.A.A.		F-152


	1.1	~~By-Laws~~By-laws (Estatutos) of Compañía de Minas Buenaventura S.A.A., as amended April 30, 2002 (incorporated by reference from Compañía de Minas Buenaventura S.A.A. Annual Report on Form 20-F for the year ended December 31, 2002, filed on June 25, 2003).

~~Method~~

~~Depreciable~~
~~Life (in~~
~~years)~~

~~Facilities and equipment:~~

~~Straight line~~

~~8 to 25~~

~~Facilities~~

~~8 to 25~~

~~Leach pads~~

~~Equipment~~

~~2.5 to 10.5~~F-134