DESCRIPTION OF THE BUSINESS:	3 Months Ended
Mar. 31, 2022
DESCRIPTION OF THE BUSINESS:
DESCRIPTION OF THE BUSINESS:	Southern Copper Corporation NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited) NOTE 1— DESCRIPTION OF THE BUSINESS: The Company is a majority-owned, indirect subsidiary of Grupo Mexico S.A.B. de C.V. (“Grupo Mexico”). As of March 31, 2022, Grupo Mexico, through its wholly-owned subsidiary Americas Mining Corporation (“AMC”) owned 88.9% of the Company’s capital stock. The condensed consolidated financial statements presented herein consist of the accounts of Southern Copper Corporation (“Southern Copper”, "SCC" or the “Company”), a Delaware corporation, and its subsidiaries. The Company is an integrated producer of copper and other minerals, and operates mining, smelting and refining facilities in Peru and Mexico. The Company conducts its primary operations in Peru through a registered branch (the "Peruvian Branch" or “Branch” or “SPCC Peru Branch”). The Peruvian Branch is not a corporation separate from the Company. The Company's Mexican operations are conducted through subsidiaries. The Company also conducts exploration activities in Argentina, Chile, Ecuador, Mexico and Peru. In the opinion of the Company, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting only of normal recurring adjustments) necessary to fairly state the Company’s financial position as of March 31, 2022 and the results of operations, comprehensive income, cash flows and changes in equity for the three months ended March 31, 2022 and 2021. The results of operations for the three months ended March 31, 2022 are not necessarily indicative of the results to be expected for the full year. The December 31, 2021 balance sheet data was derived from audited financial statements, but does not include all disclosures required by generally accepted accounting principles in the United States of America (“GAAP”). The accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements at December 31, 2021 and notes included in the Company’s 2021 annual report on Form 10-K. CUAJONE STOPPAGE OF OPERATIONS On February 28, 2022 a small group of protesters from the community of Tumilaca, Pocata, Coscore and Tala, which have 472 residents in total, seized the facilities at the Viña Blanca water reservoir and cut off the water supply to the homes of the approximately 5,000 people who live in Cuajone. Prior to this illegal action, on February 18, 2022, the railway between Cuajone and Ilo was also blocked by a group of community members. They claim the Company usurped their land and demand compensation of $5.0 billion, in addition to the permanent payment of 5% of net profits. As of March 31, 2022, the Cuajone operations remained closed with an estimate production loss of 12,869 tonnes of copper content and 296 tonnes of molybdenum, which translates into a reduction in sales of $117 million. The Company also recorded $7.9 million of unabsorbed fixed costs, which directly impacted the cost of sales. The effect on the Company´s net income and financial position was not material as of March 31, 2022. Sales contracts were not significantly affected and measures were taken to acquire concentrates from the Company´s Mexican Operations and third parties to maintain and adequate supply to the smelter. This prevented a force majeure event from delays in fulfilling the Company´s sales commitments. As of March 31, 2022, the Company was expecting to enter into a dialogue with the protesters and the Peruvian authorities to secure an agreement to address reasonable social demands; restore the water supply to workers and their families, and resume operations at the Company Cuajone facilities. However, if this situation continues indefinitely, the Company may be forced to consider cost reduction measures, including the relocation or furlough of workers.

DESCRIPTION OF THE BUSINESS:

3 Months Ended

Mar. 31, 2022

Southern Copper Corporation

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

NOTE 1— DESCRIPTION OF THE BUSINESS:

The Company is a majority-owned, indirect subsidiary of Grupo Mexico S.A.B. de C.V. (“Grupo Mexico”). As of March 31, 2022, Grupo Mexico, through its wholly-owned subsidiary Americas Mining Corporation (“AMC”) owned 88.9% of the Company’s capital stock. The condensed consolidated financial statements presented herein consist of the accounts of Southern Copper Corporation (“Southern Copper”, "SCC" or the “Company”), a Delaware corporation, and its subsidiaries. The Company is an integrated producer of copper and other minerals, and operates mining, smelting and refining facilities in Peru and Mexico. The Company conducts its primary operations in Peru through a registered branch (the "Peruvian Branch" or “Branch” or “SPCC Peru Branch”). The Peruvian Branch is not a corporation separate from the Company. The Company's Mexican operations are conducted through subsidiaries. The Company also conducts exploration activities in Argentina, Chile, Ecuador, Mexico and Peru.

In the opinion of the Company, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting only of normal recurring adjustments) necessary to fairly state the Company’s financial position as of March 31, 2022 and the results of operations, comprehensive income, cash flows and changes in equity for the three months ended March 31, 2022 and 2021. The results of operations for the three months ended March 31, 2022 are not necessarily indicative of the results to be expected for the full year. The December 31, 2021 balance sheet data was derived from audited financial statements, but does not include all disclosures required by generally accepted accounting principles in the United States of America (“GAAP”). The accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements at December 31, 2021 and notes included in the Company’s 2021 annual report on Form 10-K.

CUAJONE STOPPAGE OF OPERATIONS

On February 28, 2022 a small group of protesters from the community of Tumilaca, Pocata, Coscore and Tala, which have 472 residents in total, seized the facilities at the Viña Blanca water reservoir and cut off the water supply to the homes of the approximately 5,000 people who live in Cuajone. Prior to this illegal action, on February 18, 2022, the railway between Cuajone and Ilo was also blocked by a group of community members. They claim the Company usurped their land and demand compensation of $5.0 billion, in addition to the permanent payment of 5% of net profits.

As of March 31, 2022, the Cuajone operations remained closed with an estimate production loss of 12,869 tonnes of copper content and 296 tonnes of molybdenum, which translates into a reduction in sales of $117 million. The Company also recorded $7.9 million of unabsorbed fixed costs, which directly impacted the cost of sales.

The effect on the Company´s net income and financial position was not material as of March 31, 2022. Sales contracts were not significantly affected and measures were taken to acquire concentrates from the Company´s Mexican Operations and third parties to maintain and adequate supply to the smelter. This prevented a force majeure event from delays in fulfilling the Company´s sales commitments.

As of March 31, 2022, the Company was expecting to enter into a dialogue with the protesters and the Peruvian authorities to secure an agreement to address reasonable social demands; restore the water supply to workers and their families, and resume operations at the Company Cuajone facilities. However, if this situation continues indefinitely, the Company may be forced to consider cost reduction measures, including the relocation or furlough of workers.