Record gold and copper prices are also a boon for illegal mining in Peru

PRIMITIVE ACCUMULATION OF CAPITAL

Bloomberg News | May 22, 2024 |

Madre de Dios is one of the areas in Peru affected by illegal mining. (Image courtesy of Peru’s Ministry of Defense, Flickr).

Record prices of gold and copper are buoying the spirits of mining leaders gathered in the Peruvian capital this week.


But surging metal markets are also stoking concerns that the windfall will accelerate growth in illegal production that will increasingly disrupt the operations of global mining companies.

Informal miners are encroaching on the sites of large legal mines in the Andean nation, with executives at the Lima conference telling Bloomberg News they fear confrontations will worsen as prices climb. It’s an example of how surging commodity prices can bolster shadow economies around the world, particularly in poorer nations with weaker institutions, in a challenge to large companies and authorities.

The situation has also led to dangerous confrontations: One of Peru’s top gold miners, Minera Poderosa, has had more than a dozen employees killed in what the industry is increasingly describing as an open conflict between the company and violent illegal miners.

While most illegal mines in Peru focus on gold, there are also cases of undocumented copper operators who have found ways to handle the much bigger volumes needed to extract the wiring metal. Southern Copper Corp. has been trying to clear illegal miners from one of its projects, while MMG Ltd.’s Las Bambas faces the challenge of clearing the site of what will become a planned third pit. First Quantum Minerals Ltd. said Wednesday that it’s also had illegal miners at its nearby Haquira project.

“Evidently, higher prices bring incentives,” Southern Copper chief financial officer Raul Jacob said in an interview. “And we know that if we leave things the way they are now, there will be more illegal mining.”

Energy and Mines Minister Romulo Mucho said this week that illegal mining had become a “huge challenge” and that the government was working on a bill to create a new framework for small miners. An existing scheme to bring informal miners into the system has been criticized as having the unintended consequence of providing illegal groups further shelter from regulatory scrutiny.
Gold destinations

The output of illicit gold in the Andean nation may have climbed to 2 million ounces, or about $4.5 billion, said Victor Gobitz, head of mining and energy society SNMPE, citing the gap between formal output and shipments last year.

While foundries in Europe and North America heavily scrutinize the origin of bullion, that’s not the case in places like India and the United Arab Emirates, Gobitz said.

Operators in Peru exploit legal loopholes and a lack of supervision to boost profit, he said. Processing plants are able to register as small miners at a regional level, thereby staying off the radar of national regulators. With gold prices up about 80% in the past five years, such plants are able to fund more illegal mines in remote border areas and the Amazon, Gobitz said.

The formal mining industry is urging authorities and parliamentarians to trace the entire productive chain, including who produces, trades and uses supplies like explosives — and where bullion is exported for final refining. There has been some push-back from those defending the as many as half a million people working in precarious conditions in Peru.

“Those profiting are people that have treatment plants, who more than likely fund small miners, and those that sell critical supplies,” Gobitz said. “With such high prices and a state that has limited reach in these remote areas, this activity emerges.”

(By James Attwood and Marcelo Rochabrun)

Peru’s 2024 copper target is realistic, mining magnates say

Reuters | May 21, 2024 |

Las Bambas copper mine. (Image by MMG Las Bambas, Facebook.)

The Peruvian government’s 2024 copper production goal of 3 million metric tons is realistic, senior industry executives said on Tuesday, as the country seeks to boost mining investments to help lift the economy out of recession.


The South American country produced 2.76 million tons of copper last year, dropping its rank from first to second for global production of the red metal. It still ranks first globally for export volumes


Mining is key to Peru’s economy, which fell into a recession in 2023 due to adverse climate effects, social conflicts and a drop in investments.

“The 3 million ton projection is realistic,” Carlos Castro, manager of corporate affairs and business development at Minera Las Bambas, told Reuters on Tuesday on the sidelines of a forum attended by global mining executives.

Las Bambas, owned by the China’s MMG Ltd, has seen production drop in the recent years in the midst of social protests by residents demanding greater benefits from the mine.

“It’s a reasonable projection,” said Raul Jacob, vice president of finance at Southern Copper, the country’s third-largest copper producer.

Southern Copper hopes to increase its copper production by 20% this year from 2023, when it extracted 374,149 tons of the metal, according to government figures.


Peru’s Mining and Energy Minister Romulo Mucho announced the 3-million-ton goal in March.

“We’re going to break the record this year, we can do it, the first three months of the year show that we’re growing,” Mucho said on Tuesday.

Miners’ confidence comes as copper prices hit two-year highs.

Victor Gobitz, president of Antamina, Peru’s second-largest copper producer, said the forecast is “very optimistic,” but still achievable. “I would estimate production will land in the 2.8 to 3 million tons range.”

Antamina, which is controlled by Glencore, BHP, Teck and Mitsubishi, produced 435,378 tons of copper last year, and hopes to maintain that level in 2024.

In the last year, Peru has granted environmental permits for the expansion of some key projects and expects the construction of others such as Southern Copper’s Tia Maria.

Southern Copper’s long-stalled $1.4 billion Tia Maria project in Peru is set to break ground by the end of the year or in the first half of 2025, according to a senior company executive.

(By Marco Aquino; Editing by David Gregorio)

Why green energy is not enough – a perspective from the Global South

There’s nothing progressive about ‘going green’ if it replicates the traditional models of exploitation in poorer countries. Mike Phipps reviews The Geopolitics of Green Colonialism: Global Justice and Ecosocial Transitions, edited by Miriam Lang, Mary Ann Manahan and Breno Bringel, published by Pluto.

MAY 9, 2024

LABOUR HUB EDITORS

Earlier this year, I reviewed a book about green colonialism, focusing on North Africa and the Middle East. It discussed the dispossession of indigenous people from their land, using colonial-era laws to do so, and the diversion of valuable water sources – all in the name of pursuing a transition to green energy.

As this new book highlights, the problem is global. Ecuador’s unique tropical forest is now being torn down in the search for balsa wood to build Chinese wind turbines. In South Africa, huge hydrogen plants for exporting ‘clean’ energy are imperilling the way of life of communities which rely on small-scale fishing and agriculture. And in South America’s lithium triangle – in the high Andean salt flats where over half the world’s lithium resources are located – indigenous people are struggling to preserve the scarce water sources that are increasingly being grabbed by international mining conglomerates to equip electric cars with lithium batteries. All these dispossessions are legitimised by the label ‘green’.

The claim on unlimited raw materials from the Global South is just one aspect of this new colonialism. Carbon offset schemes, which serve to postpone the urgent structural changes needed to tackle polluting production processes in the North, are another. A third is the use of sites in the Global South for dumping toxic waste from renewable energy production. A fourth is the way the prosperous North targets the South as a market for selling renewable technologies at high prices, part of the “asymmetric architecture of global trade.”

Ecological modernisation in Europe is driving up demand for key raw materials. Demand for lithium is expected to increase forty-threefold by 2040 compared to 2020, copper twenty-eightfold. Lithium mining in Europe, with its traditions of political freedom and civil society protest, has been met by considerable local opposition. This is due to its environmental impact, particularly in terms of polluting the water table, as Xander  Dunlap points out in another new Pluto title, This System is Killing Us.Resistance to these threats is less easy to organise in more distant, repressive states.

Yet, such resistance is happening – and not simply in opposition to the environmental destruction, debilitating though that may be, that the new green extractivism is causing. Recent protests also highlight fundamental questions about societal and global power relations.

Copper mining in Peru, for example, is capital-intensive: few jobs are provided locally to offset the impact on the loss of livelihoods and  damage to the environment. These realities led over 100 indigenous people, who were dispossessed of their land, to occupy the Las Bambas copper mine in April 2022.  Chile, Argentina and Bolivia have seen similar protests.

Lithium mining in particular consumes unsustainable amounts of water, endangering the way of life of indigenous people in arid regions especially. Chile and Bolivia at least have some regulatory framework, unlike Argentina where extraction is based entirely on a neoliberal model with very low royalties for the government.

It’s clear that simply replacing individualised fossil-fuel transport with lithium-based electric vehicles is not sustainable. A reduction in consumption based on new collective models of transport will be required in the Global North. And that requirement extends beyond transport: as long as developed countries pursue growth strategies based on over-consumption, a neocolonial power imbalance towards the Global South will be maintained.

Besides grassroots resistance, initiatives are also being taken at state level to break the cycle of so-called green extractivism. Indonesia has sought to shift its position from being a raw material to a finished product exporter, producing finished electric vehicle batteries, rather than just their components. To do this, it banned the export of certain raw materials, instead refining them in-country. It also nationalised the mining sector and introduced protectionist policies to nurture its fledgling domestic industries. Predictably these steps fall foul of international trade rules devised by the Global North.

During the Colombian presidential campaign of 2022, the then candidate and now President Gustavo Petro announced he would suspend new hydrocarbon exploration and ban fracking as a means of reducing the use of fossil fuels in the country. The pledge cane 27 years after the U’wa people issued a manifesto saying they would rather face a “dignified death” than have their land exploited for oil production.

In other Latin American countries, indigenous people and farming communities have proposed “leaving the oil underground” as a way of tackling the climate crisis. Over the years, this campaign has grown in support.

The authors are clear: a green transition must be socially just, at a global level. This means de-commodifying energy and seeing it as a part of the commons, to which people have a democratic right and which should be democratically controlled by them.

Mike Phipps’ book Don’t Stop Thinking About Tomorrow: The Labour Party after Jeremy Corbyn (OR Books, 2022) can be ordered here.

Strong copper price reviving Peru’s mining mojo, minister says

Reuters | May 3, 2024 | 

MINING IS UNSUSTAINABLE

View from above of the pit of an open-pit copper mine in Peru. 

Peru’s dented mining mojo, hit by years of political turmoil in the Andean country, is being buoyed by strong copper prices and a bullish outlook they will rise further, helping lure back investor interest, the country’s mining minister said on Friday.


“The price of copper is a great attraction,” Romulo Mucho, told Reuters in an interview at his office, a reference to prices that hit two-year peaks of $10,208 a metric ton this week, close to the record high of $10,845 in March 2022.

Goldman Sachs earlier in the day hiked its year-end price target to $12,000 per ton, from $10,000 previously, citing the copper market’s path into scarcity and expectations of a larger deficit of the key metal needed for electrification.

Mucho said that the trend was helping salve mining companies’ caution in the country, the world’s no. 2 exporter that has struggled to fend off a challenge from rival producer Congo as incoming mining investment has dwindled.


The minister added he had met with executives from Newmont, Teck Resources, Hudbay Minerals, Antofagasta Minerals and others in recent months, who had shown interest in new ventures and operational mines.

“Most of the CEOs I talked to asked what projects there are and how they can get involved,” Mucho said, blaming political uncertainty under former governments for hurting the sector. Peru has had half a dozen presidents in the last six years.

“Confidence is being recovered.”

Peru expects to produce some 3 million tons of copper this year, up from 2.75 million last year, a goal Mucho stuck by, though he added production from protest-hit Las Bambas, owned by China’s MMG Ltd, was key to hitting the target.

(By Marco Aquino; Editing by Adam Jourdan and Marguerita Choy)

MONOPOLY CAPITALI$M

Copper smelters in China wary of BHP-Anglo tie-up

Reuters | April 30, 2024 | 


Chinese smelters, the world’s biggest buyers of mined copper, are concerned they will lose power to negotiate prices if BHP Group, known locally as “the big miner”, succeeds in its bid for rival Anglo American.


BHP, the world’s largest listed mining group, is fine-tuning an offer that could make it the biggest producer of copper, a metal in high demand as the world seeks to shift towards electric vehicles and a lower carbon economy.

The proposed takeover would give BHP control of roughly 10% of global mined supplies, surpassing Chile’s Codelco and Freeport-McMoRan.

“This is not good news for China given the heavy reliance on external supply, and Chinese companies hold limited resources,” Zhang Weixin, a metal analyst at China Futures, said of the potential tie-up.

The China Smelters Purchase Team (CSPT), a group of top smelters that negotiates with miners on yearly prices to treat and refine copper, has no current plans to urge Beijing to investigate the deal, three sources familiar with the matter said.

CSPT’s head could not be reached for comment and BHP declined to comment.

China’s State Administration for Market Regulation also did not immediately respond to a request for comment.

There is a precedent of Chinese regulators getting involved in deals that impact copper supply.

In 2011, Glencore agreed to China’s demand that it sell its interest in Xstrata’s Las Bambas copper project in Peru to clinch their multi-billion dollar deal.

The world’s leading consumer of the metal, China imported 27.54 million metric tons of copper ore and concentrate in 2023, worth $60.1 billion, customs data showed, more than half of global supplies.
Tight market

In China, BHP is most active in the spot market, where it sells to domestic smelters using tenders, according to smelters and analysts, signing contracts for fixed volumes to be priced via an index provided by third parties.

By comparison, rival miners Freeport and Antofagasta agree an annual fixed sale price with China’s smelters that is widely used as an industry benchmark.

Chinese copper smelters said the prospect of more supply being sold under index pricing could increase uncertainty for costs and planning.

None of the smelter officials wished to be identified given the sensitivity of the matter.

One of them said index pricing meant smelters would be unable to estimate production costs and to draw up a full-year production plan.

Smelters are still recovering from supply shortages driven by the December closure of the First Quantum’s Cobre Panama mine, which drove down treatment charges (TCs) – their main source of income.

Treatment charges are fees paid by miners for converting raw materials into metal. They fall when mine output decreases as smelters have to compete for concentrate.


Adding to their difficulties, the concentrate market is expected to be in deficit for the next three years.

Last week, spot treatment charges (TCs) in China turned negative for the first time since pricing agency Fastmarkets started the index in 2013.

That compares with 2024 benchmark TCs settled between Chinese smelters and Freeport and Antofagasta at $80 per ton.

Much as consolidation raises concerns, however, William Adams, head of base metals research at Fastmarkets in London, said it could calm the market longer term by tackling the high cost and risk of developing mines.

“Look at the current tightness in spot treatment and refining charges, which is because there is insufficient mine supply to meeting smelter’s demand, highlights the need to invest more upstream,” he said.

(By Siyi Liu, Julian Luk, Mai Nguyen and Melanie Burton; Editing by Tony Munroe and Barbara Lewis)

Anglo spinoffs will ‘very likely’ need South Africa approval

Bloomberg News | April 30, 2024 | 

Loading hauled ore from the mine into the primary crusher at Kumba Iron Ore’s Kolomela. (Image courtesy of Anglo American | Flickr.)

BHP Group Ltd.’s proposal for Anglo American Plc to spin off platinum and iron ore units before a takeover would likely require approval from South African regulators, according to a government agency.


Under BHP’s offer, Anglo would need to first divest its controlling interests in Kumba Iron Ore Ltd. and Anglo American Platinum Ltd., both of which are listed in Johannesburg and operate assets in South Africa. Anglo rejected the initial $39 billion proposal from the Australian mining giant last week.

Analysts have pointed to South Africa as one of the biggest potential hurdles to a deal, even if Anglo’s board can be won over. Founded in 1917 by Ernest Oppenheimer, Anglo has long ties to South Africa and was built on the back of the country’s gold mines. The proposed spinoffs highlight the fragile state of the country’s critical mining industry, as the ruling African National Congress struggles to bolster its appeal before elections next month.

Even before BHP’s proposal, Anglo’s platinum subsidiary was weighing thousands of job cuts in a country with one of the world’s highest unemployment rates. The ANC’s national chairman has signaled his opposition to BHP’s proposed takeover.

Even though BHP doesn’t want to buy Kumba and Amplats, South Africa could have an important role to play if an eventual deal is structured in the manner originally outlined. The country’s Competition Commission not only evaluates antitrust impacts but also “public interest” factors, including how a proposed acquisition will affect employment levels and historically disadvantaged people.

“There are numerous and current merger reviews in which the agency has imposed stringent conditions on the basis of the transactions’ effect on the public interest criteria,” said John Oxenham, Johannesburg-based managing partner at Primerio, a law firm that specializes in competition cases.

BHP is considering making an improved proposal for London-listed Anglo, Bloomberg reported April 27, citing people familiar with the matter. The main prize for BHP is Anglo’s South American copper operations, while the non-South African iron ore business and coking coal mines in Australia would also fit well with its existing operations.

If Anglo shareholders accept an improved offer with the same conditions, spinning off Kumba and Amplats is “very likely to meet the mandatory thresholds” that would require approval from South Africa’s regulatory authorities, Competition Commission spokesman Siyabulela Makunga said in an emailed response to questions. The agency assesses each deal “based on its own merits” in accordance with the law, he said.

South Africa Mines Minister Gwede Mantashe has signaled his opposition to the takeover, telling Bloomberg last week that he “wouldn’t support” the proposal. “I don’t think Anglo will agree to that,” said Mantashe, who also chairs the ANC.

The country’s state pension fund – the Public Investment Corp. – is also Anglo’s second-largest shareholder, controlling an 8.4% stake, according to data compiled by Bloomberg.

(By William Clowes)

Protesters agree to lift blockade near Las Bambas copper mine

Reuters | April 11, 2024 | 

Las Bambas copper mine in Peru. (Image by MMG).

Protesters have agreed to lift a road blockade on a key Peruvian transport route near the Andean country’s major Las Bambas copper mine, sources with knowledge on the matter told Reuters on Thursday, after reaching a deal with the miner.


The mine, owned by China’s MMG Ltd, had faced a fresh protest by local communities demanding greater benefits from the copper mine, a major producer in a country that ranks among the world’s top suppliers of the red metal.

Protest leader Robertson Pacheco and a source close to the company did not give details on the deal, but residents from Velille, in Cusco’s Chumbivilcas province, had according to the source asked for an annual sum of 2 million soles ($544,218).

The company had previously offered 1.15 million soles for 2024/25 alongside technical assistance for development projects, the source said – a deal two other communities, one in Cusco and another in the Aprurimac region, had accepted.

Residents in Velille started protesting over a week ago after a meeting with company representatives failed to provide a solution, but as of Thursday, the mine’s production had according to a source not been impacted.

Though the protest had paralyzed the flow of trucks carrying minerals through the country’s so-called “mining corridor” to the coast for export, an alternate route was being used to supply the mine.

Las Bambas has faced frequent stoppages due to protests by poor communities demanding more benefits from the nearby mines. Since launching operations in 2016, the mine counts around 600 days of stoppages.

Last year, the mine nevertheless produced 302,039 metric tons of copper, up from 254,838 tons in 2022, according to government data. It typically supplies around 2% of global copper supplies and is one of the top producers in Peru.

($1 = 3.6750 soles)

(By Marco Aquino and Sarah Morland; Editing by David Gregorio and Stephen Coates)

Peruvian government unveils platform to expedite exploration permits

Staff Writer | February 4, 2024 | 

Peruvian Minister of Energy and Mines, Oscar Vera Gargurevich.

 (Image by Minem, X.)

Officials from the Peruvian Ministry of Energy and Mines (Minem) met with representatives from the largest mining companies operating in the country to offer details on the implementation of the Digital Information Single Window platform, which is the result of a collaboration between nine government departments and is expected to expedite the issuance of exploration permits.


Executives from China’s MMG Minera Las Bambas, which accounts for 2% of the global copper output, were there, together with representatives from Compañía de Minas Buenaventura, whose biggest shareholder is Antofagasta Plc.; Teck Resources’ (NYSE: TECK) Compañía Minera Zafranal; Nexa Resources’ (NYSE: NEXA) Nexa Resources Perú; Aluminum Corp of China’s Minera Chinalco; Gold Field La Cima, and China’s Shougang Hierro Perú, among others.

The miners applauded the Peruvian government’s effort to streamline certain processes and pointed out the importance of achieving greater coordination among all regulatory entities, particularly the National Water Authority (ANA) and the National Environmental Certification Service for Sustainable Investments (SENACE).

According to the Minem, the next steps in the development of the Single Window are focused on reducing the amount of paperwork miners need to submit when moving into the exploitation and production stages.

“This initiative seeks to facilitate investors’ work in the development of mining activities in a responsible manner, with greater efficiency, and streamlining administrative processes to avoid duplication,” the Vice Minister of Mines, Henry Luna Córdova, said at the meeting.

The government officials also took the opportunity to highlight that Peru broke a copper production record in 2023, having produced over 2.75 million fine metric tonnes of the red metal, a 12.7% increase from the production registered in 2022.

According to the US Geological Survey’s 2024 Mineral Commodity Summaries, the Andean country kept its position as the No. 2 copper producer in the world.

The Minem also released the figures for other metals, noting that gold production reached 99 million fine grams in 2023, which is 2.8% more than what was produced in 2022 and which is mainly the result of the good performance of Newmont’s (NYSE: NEM) Minera Yanacocha.

Zinc, on the other hand, reached over 1.4 million fine metric tons, which is a 7.2% increase from 2022, with Compañía Minera Antamina and Volcan Compañía Minera taking the lead.

Finally, the ministry mentioned that iron ore production reached over 14 million fine metric tons, which represents an 8.8% increase from the previous year.

Deadly attack spurs plea for Peru crackdown on unlicensed mines

Bloomberg News | December 5, 2023 | 

Credit: Minera Poderosa SA

Mining executives in Peru are imploring authorities to crack down on escalating violence by informal miners, which this weekend cost the lives of nine staff members of a large, legal gold mine.


“Formal mining is under attack,” Angela Grossheim, the head of industry group SNMPE and a former minister, told reporters Tuesday. “Illegal mining today is the country’s main illicit activity, even bigger than drug trafficking.

Over the weekend, workers in a shaft at a mine run by Cia. Minera Poderosa SA were ambushed by explosives, bringing the number of deaths in clashes with informal miners at Poderosa to 16 in the past two years. Peru is a major gold and copper supplier, with the two metals attracting more informal mines made more lucrative by high prices and new techniques.

Conflicts have extended to some of Peru’s sprawling copper deposits, including Southern Copper Corp.’s Los Chancas project and MMG Ltd.’s Las Bambas mine. Both have struggled to develop new pits in areas that have drawn informal miners. The Los Chancas mining camp was burned down last year.

The industry is laying part of the blame on temporary permits known in Peru as Reinfo, a registry that allows informal miners to operate with some legal protections while they formalize operations. But the registry has been open for a decade and many workers have remained in the system without formalizing.

“It’s time to put a stop to this mantle of impunity,” said Poderosa corporate affairs manager Pablo de la Flor. He added that Poderosa has been in conflict with informal miners who are part of the Reinfo registry.

Poderosa is calling on authorities to send in the army at a site where hundreds of additional police officers have been deployed. The Lima-based firm has hired an additional 1,200 security guards just in the past few months.

(By Marcelo Rochabrun)

Strike at Las Bambas mine to end on Thursday

Reuters | November 28, 2023 |

Las Bambas is one of Peru’s largest copper producers, accounting for around 2% of global supply. (Image courtesy of MMG Instagram.)

A workers union at Peru’s large Las Bambas copper mine, owned by China’s MMG Ltd, began a two-day strike on Tuesday to demand greater profit sharing and better transport conditions, said the union’s secretary general Erick Ramos.


The mine is one of Peru’s largest copper producers, while the country itself is the No. 2 producer worldwide.

The strike, originally organized for an indefinite period, will end on Thursday at 5:30 a.m. local time, Ramos said on Tuesday afternoon.

“The labor authority declared the strike improper and, in order to avoid reprisals against the workers, it was decided to shorten the duration of the protest,” Ramos said in an interview with Reuters.

“The company does not want to consider our demands, and the relationship between the company and the union has broken down,” Ramos added.

Representatives for Las Bambas did not immediately respond to a request for comment.

Earlier on Tuesday, Ramos said in an interview that the union is demanding additional compensation after being informed by the company that “profits will be halved this year” and therefore there would be fewer benefits for employees under the profit-sharing scheme.

Slightly more than half of the 2,000 workers employed at the mine are part of the union, according to Ramos.

Las Bambas put out 221,160 metric tons of the red metal from January to September this year, nearly 22% more than the same period a year ago, according to Peru’s mining ministry.

Production at the copper mine has been recovering after a stoppage earlier this year caused by anti-government protests blocking an access road.

Las Bambas has a history of work stoppages due to protests by nearby Indigenous communities calling for more benefits from the mine.

(By Marco Aquino and Kylie Madry; Editing by Kirsten Donovan, Sarah Morland and Aurora Ellis)

Workers at MMG’s Las Bambas mine go on indefinite strike

Reuters | November 28, 2023 |

Las Bambas mine in Peru is considered the world’s ninth-largest copper mine. Its production, however, has been curtailed by ongoing protests. (Image courtesy of Minera Las Bambas).

A workers union at Peru’s large Las Bambas copper mine, owned by China’s MMG Ltd, on Tuesday went on strike for an indefinite period, said the union’s secretary general Erick Ramos.


Las Bambas workers are demanding greater profit sharing and better transport conditions.

The mine is one of Peru’s largest copper producers, while the country itself is the No. 2 producer worldwide.

Las Bambas put out 221,160 metric tons of the red metal from January to September this year, nearly 22% more than the same period a year ago, according to Peru’s mining ministry.

Ramos said in an interview that the union is demanding additional compensation after being informed by the company that “profits will be halved this year” and therefore there would be fewer benefits for employees under the profit-sharing scheme.

Slightly more than half of the 2,000 workers employed at the mine are part of the union, according to Ramos.

Representatives for Las Bambas did not immediately respond to a request for comment.

Production at the copper mine has been recovering after a stoppage earlier this year caused by anti-government protests blocking an access road.

Las Bambas has a history of work stoppages due to protests by nearby indigenous communities calling for more benefits from the mine.

(By Marco Aquino and Kylie Madry; Editing by Kirsten Donovan and Sarah Morland)

Peru mining keeping country out of deeper recession, minister says

Tue, November 28, 2023 a
By Kylie Madry

Nov 28 (Reuters) - Peru's mining sector is keeping the economy from sinking deeper into repression, Economy Minister Alex Contreras said on Tuesday, adding that progress kick-starting projects was a priority in the near term.

"If it weren't for mining, we would probably be facing a larger recession this year," Contreras said at a conference. Peru has been preparing to launch a package of economic stimulus measures.

Contreras said the first three measures, out of more than two dozen aimed at attracting mining investment and boosting production, would be published later in the day.

Peru, the world's No. 2 copper producer, fell into a recession this year due to the El Nino weather phenomenon, lower private investment and lingering effects from anti-government protests late 2022 and early this year.

Contreras said the mining nation was aiming to consolidate an industry "hub" in Peru's south, highlighting existing projects such as copper mines Las Bambas, Antapaccay and Cerro Verde.

Peru is betting on a boost from public-private partnerships, eyeing $7.98 billion in the partnerships next year, Contreras said. "In 2024, we want to at least triple the amount awarded to projects by public-private partnerships from this year."

Contreras highlighted a port "hub" project "to make Peru the international trade center of South America."

A megaport project

outside of Lima is set to open next year, but Peru is still working "against the clock" to make sure supporting infrastructure is ready in time.

Contreras also said the Ancon industrial park developed by the state, near the port, would be a guinea pig for the special economic zones set to be proposed to Congress soon.

"These will be special economic zones administrated by private organizations, on either public or private land," said Contreras, underscoring expectations for added tax revenues and greater investment in exports. (Reporting by Kylie Madry; Editing by Sarah Morland and David Gregorio)

Union set to strike at Peru’s Las Bambas copper mine next week

Reuters | November 20, 2023 | 

Las Bambas copper mine in Peru. (Image by MMG).

Workers at the Chinese-owned Las Bambas copper mine in Peru will kick off an “indefinite” strike beginning next week after the miner failed to deliver information on profit-sharing protocols, the union’s leader said on Monday.


Erick Ramos, general secretary of the Las Bambas workers union, told Reuters by telephone the union had agreed to go on a strike with no set end date starting Nov. 28.

“A meeting with the company was set for today to explain information regarding profit sharing, but that did not happen,” Ramos said.

Representatives for Las Bambas did not immediately respond to requests for comment. The mine, owned by China’s MMG Ltd, began operations in 2016 and is among the largest copper producers in Peru, the world’s No. 2 producer of the metal.

The union had already kicked off a strike on Sunday, which is set to end Tuesday, over the profit sharing.

The miner, as part of its contract with workers, is to share some profits every year with employees.

However, the mine “had already said that there wouldn’t be any profit sharing this year,” Ramos said. “So they’re going to have to see how to pay the workers. By contract they were supposed to have given us part of that payment in November.”

Las Bambas has pumped out around 221,160 metric tons of copper from January to September this year, a 21.7% boost from the year before, according to sources at the mining ministry.

The mine’s production has steadily increased after having to freeze operations at the beginning of the year due to roadblocks by anti-government protesters following December’s ouster of President Pedro Castillo.

A source close to the mine said the company respects labor rights “and works hard to ensure a safe working environment for its workers,” noting the labor ministry had declared the current strike “inadmissible”.

The union, which represents more than 1,000 workers, is currently registering the strike set for Nov. 28 with the labor ministry, Ramos said.

(By Marco Aquino, Isabel Woodford and Kylie Madry; Editing by Louise Heavens, Kirsten Donovan and David Gregorio)

Peru's mining zones back protests, which Boluarte calls 'threat to democracy'

By Marco Aquino

July 18, 2023

Demonstrators participate in a march called by Peru's General Workers Union against President Dina Boluarte's administration, in Lima, Peru, March 9, 2023. REUTERS/Alessandro Cinque/File Photo


LIMA, July 18 (Reuters) - Residents of Peru's key mining areas are expected to support protests due to kick off this week against the government of President Dina Boluarte, who on Tuesday denounced the planned demonstrations as a "threat to democracy."

Communities along the main mining corridor in Peru - the world's No. 2 copper producer - have voiced their backing for the protests, which begin Wednesday, NGO leaders said.

Mining output was heavily impacted in January and February during an earlier round of protests following the ouster of former President Pedro Castillo, who was arrested after illegally attempting to dissolve Congress.

"We know some delegations (from mining communities) are going to arrive (in Lima), and they will also mobilize in their communities like at the beginning of the year," said Jose de Echave, head of environmental NGO CooperAccion, which monitors mining conflicts.

The mining corridor, which crosses poor, largely Indigenous communities in Peru's south, transports copper from mines such as MMG Ltd's (1208.HK) Las Bambas, Glencore's (GLEN.L) Antapaccay and Hudbay's (HBM.TO) Constancia.

'VIOLENCE NOT ALLOWED'

Peru's government has warned that authorities will react to protests, called by unions and left-wing groups, with "legitimate use of force."

The initial round of protests were Peru's deadliest in decades, with human rights groups denouncing "extrajudicial killings" by security forces.

The protests call for Castillo's release, Boluarte's resignation, the closure of Peru's unpopular Congress and a new constitution. Boluarte said in a speech on Tuesday that the government is "not able to resolve" such demands.

Boluarte added that the protests represent "a threat to democracy" and that "acts of violence are not going to be allowed."

Her government has placed the military along the mining corridor and enacted states of emergency suspending constitutional rights such as freedom of assembly and freedom of movement as a way of blocking the protests, de Echave said.

Economy Minister Alex Contreras also said on Tuesday that maintaining the peace was key for Peru's economy.

Organizers of the demonstrations, which have been dubbed "the third takeover of Lima," have said protesters are largely coming from Peru's poorer south, rather than the more economically prosperous capital.

Editing by Daniel Wallis

Chinese-Owned Mine Hit by More Delays in Key Peru Copper Expansion Project

Marcelo Rochabrun
Thu, July 13, 2023 


(Bloomberg) -- A unit of state-owned China Minmetals Corp. is bracing for further delays in building a second pit at its troubled Las Bambas copper mine in Peru, while the military there continues to buffer the operation from protest disruptions.

A long-delayed project to mitigate depletion at the current pit was slated to begin in the second half of the year. That’s looking increasingly unlikely due to delays in negotiations with an indigenous community.

“We hope we can finish negotiations this year, but it’s too early in the process yet to know how fast it will go,” Troy Hey, who heads corporate relations at Hong Kong-listed MMG Ltd, said in an interview from Lima. “Once we get an agreement, it’s probably up to three months to get to mining.”

Las Bambas, located in a remote part of the Peruvian Andes, is one of the world’s biggest and most troubled mines. It’s faced recurrent protests from indigenous communities since opening in 2016 at a cost of $10 billion. Blockades and other disruptions have exceeded 600 days in that span, interrupting shipments to smelters in China.

The mine, previously owned by Glencore Plc through its acquisition of Xstrata, can produce as much as 400,000 metric tons a year. But it’s repeatedly underperformed because of protests and declining ore quality. Opening the second pit would see Las Bambas run at full capacity. Without it, the mine will produce about 300,000 tons next year, assuming no disruptions, Hey said.

It’s currently operating with military protection. Tensions reached a peak a year ago when the Huancuire community entered Las Bambas and built a camp on land they had sold to the company for the second pit. Hey said Huancuire members had finally left the area, but that talks were not done yet. MMG is encouraged by new community leadership and is overhauling its approach to community relations, Hey said.

“We are in the best place we have been for a long time in terms of negotiations but it’s tough to see what time-frame it will be,” he said. Huancuire leadership turnover had stalled talks for more than six weeks but MMG hopes to restart negotiations next week, Hey said.

Transporting semi-processed copper from Las Bambas to a seaport has long been the company’s biggest challenge. It uses a mostly unpaved road that traverses about 70 indigenous communities, many of which have long complained about insufficient financial benefit from mining.

President Dina Boluarte has managed to keep copper flowing since March by deploying military to the area. Her administration plans to keep soldiers there until further notice.

“Having police and military presence to keep things calm is not a long-term solution, though I think at the moment we greatly appreciate the support of the government to do that,” Hey said.

Without the military, Las Bambas probably would have seen renewed blockades, he said. “It’s a chronic problem, and so if we do nothing differently we should expect to see the same outcome.”

Peru copper mines aim for output boost in 2023 after protest impact fades
Reuters | March 30, 2023

Antapaccay copper mine in Peru. (Photo: Glencore)

Peru’s copper miners hope to increase output in 2023 after recovering from the impact of major protests at the start of the year, industry executives said, despite simmering anti-government anger in the world’s no. 2 producer of the red metal.


The South American country saw a number of key mines reduce or temporarily halt production in January and February during the deadliest protests that have hit Peru in over 20 years, with the worst violence in the copper-rich Andean south


However, protests and blockades that snarled transport to and from mines have largely been lifted, despite ongoing public anger since the dramatic ouster late last year of leftist leader Pedro Castillo. Voters are still pushing for snap elections.

“The southern (mining) corridor is operating normally, all the inventories of concentrates that the mines had are been sent to the coast,” said Víctor Gobitz, president of mining sector body SNMPE and chief executive of Peru’s top mine Antamina.

Power data from Peru’s private power sector body COES, analyzed by Reuters, shows activity at Peru’s top mines has stabilized since early March following the disruptions earlier this year, which stalled production and shipments.

That’s a boost for mines, including Chinese state-owned MMG Ltd’s Las Bambas, Glencore PLC’s Antapaccay, Hudbay’s Constancia, and Antamina, co-owned by Glencore, BHP Group Ltd, Teck Resources Ltd and Mitsubishi Corp.

Gobitz said the easing of protests and new mines coming fully online like Anglo American’s $5.5 billion Quellaveco would push up overall copper production this year.

“If we manage to resolve the issue of the mining corridor and the 100% effect of Quellaveco, then without a doubt Peru will produce more copper in 2023 than in 2022,” he said.

Peru produced some 2.44 million tonnes of copper last year, 4.8% more than in 2021 and very close to the maximum level before the global effects of the Covid-19 pandemic.

Ratings agency Moody’s said in a March report that most miners in Peru had survived relatively unscathed from the protests, though the impact would likely “delay mining company permits for projects already under construction.”

In southern Puno, the San Rafael de Minsur tin mine, the world’s fourth largest, has slowly restarted operations since March 20 after a roughly 10-week halt due to protests, though blockades continue on weekends.

A Minsur spokesperson told Reuters the mine was “on track to be operating at full capacity, but it takes some time to get there. It will depend on there being no other interruptions.”

(By Marco Aquino; Editing by Adam Jourdan and Jonathan Oatis)

Peru mining firms' logistics at risk from extended protests, Fitch says



 Protest against the suspension of the Las Bambas mine, in Lima

Thu, March 9, 2023

(Reuters) - Mining companies operating in Peru face "material risk" amid extended protests and blockades in the world's No. 2 copper-producing nation, Fitch Ratings said on Thursday, warning of possible lack of supplies and issues transporting ore to ports.

"We believe protests and blockades that extend beyond three months can pose a material risk to a mine's operations, including logistics," Fitch said in a report, highlighting uncertainty on when the conflicts will be resolved - particularly in areas with important copper deposits.

The South American nation has since December faced a political crisis driving extended protests and blockades which have left dozens dead, following the ouster of former leftist President Pedro Castillo, who had an important support base among impoverished areas of the southern Andean region.

Miners Buenaventura and Volcan, which operate only in Peru, could face especially high risk of disruption due to lack of supplies and problems transferring products to ports on the country's Pacific coast, Fitch said.


However, companies with several commodity businesses and solid liquidity should be able to carry out shipments to the coast with limited difficulty, it said.

Earlier this week, Energy and Mines Minister Oscar Vera said the country's key mining corridor was "practically unblocked," and data early this month showed key copper mines cranking up activities again despite the uncertainty.

(Reporting by Marion Giraldo; Editing by Sarah Morland and S

Peru to unleash stranded copper with roadblocks largely cleared
Bloomberg News | March 7, 2023 | 

Protesters in Lima draped with Peruvian flags and waving Wiphalas. Credit: Wikipedia

The government of Peru, the second-biggest producer of copper and zinc, expects that shipments of the commodities will begin to normalize within days as the nation’s worst street protests in decades ease.


“The issue of protests has been reduced to a minimum at this time,” Oscar Vera, newly-appointed energy and mines minister, said in an interview. “The mining corridor is now open and in the coming days, mineral will begin to be taken out.”

The full resumption of shipments will come as a relief to tight global metal markets, which were roiled by a surge of protests prompted by the impeachment of former President Pedro Castillo. The months of unrest — which constrained the transport of metal to ports and supplies to mines — embroiled operations by companies including Glencore Plc and Freeport-McMoRan Inc., while highlighting risks to commodity output from emerging markets.

Speaking on the sidelines of a conference in Toronto on Monday, Vera said authorities eased tensions by establishing lines of communication with communities and understanding their concerns. In many cases, conflicts related to stalled investments in local water and health projects, he said, adding that the government has stepped up efforts to ensure public works get done.

To be sure, unrest lingers in some areas. In Puno, home to some of the worst protests, roadblocks have continued even after those in other mining regions were lifted. While Minsur SA’s giant San Rafael tin mine has restarted operations after a 45-day halt, it’s still a long way from full capacity.

Minister Vera said direct and ongoing communication and concrete action to address demands were paying off — even at MMG Ltd.’s Las Bambas mine, which has endured more than 400 days of roadblocks in its seven-year history.

With blockades at a minimum, Las Bambas will probably resume copper transport “between today and tomorrow,” Vera said. He said he’s hoping there’ll be a lasting solution with a military presence along roads and authorities on the ground to make sure mine commitments are met. There are also proposals to change the route used to transport ore to port.

Peru’s copper production is likely to have taken a hit from the protests, but Vera said he was “very optimistic that in the coming days everything starts to normalize,” with output recovering over the rest of the year.

The government has identified a total of $6.9 billion in mining investments this year and next, made up of seven likely projects. Still, there are some projects, such as Southern Copper Corp.’s Tia Maria, that while technically sound, require further work to convince local communities of the benefits, he said.
Oil reentry

Vera defended state-owned Petroleos del Peru SA’s plans to resume drilling in the Amazon rainforest at what was once the nation’s largest and leakiest oil field.

Petroperu’s move back into the highly profitable oil-producing industry carries little risk because it’s doing so in a field that only requires reactivation rather than a capital intensive development, he said.

For Lot 192, in a remote area near Ecuador, Petroperu is seeking an operating partner and is “negotiating with a company, I understand,” the minister said.

(By James Attwood and Marcelo Rochabrun)

State-sanctioned violence in Peru and the role of Canadian mining

Canadian firms benefit from state-sanctioned police protection and impunity at the expense of human rights and the environment

Kirsten Francescone / March 4, 2023 / 

https://canadiandimension.com/

Protests against the Tía María copper mining project in Islay, Arequipa Region, Peru. Photo by Diario Correo.


On January 18, 2023, as thousands of Peruvians were taking to the streets in Lima to denounce the spiralling political crisis in the country, Canadian Ambassador Louis Marcotte was meeting with the Peruvian Minister of Energy and Mines. Protests have been ongoing since December when populist President Pedro Castillo was deposed from office by congressional vote, a move which was almost immediately condemned by Castillo’s base. Demonstrators have been met with widespread arrests and brutal violence. According to Yves Engler, since former Vice President Dina Boluarte assumed power (a move which the Canadian government endorsed) the Canadian mission has met with numerous top-level Peruvian officials in unprecedented fashion.

Since Boluarte assumed the presidency mobilizations have exploded across the country. Although they differ in their diversity of demands, they coincide along four main points: a call for new general elections for 2023, the closure of congress, Boluarte’s resignation, and the calling of a constituent assembly to draft a new constitution. But these immediate political demands have historical roots. As one collection of Peruvian NGOs stated, the mass movement of Peruvians from the south and peripheral regions is born out of a sense of indignation at a political and economic system which is highly racist and discriminatory. In Puno, the epicentre of protests and extreme police repression, delegations of rural community members travelled to Lima to demand political reforms and solutions to the toxic environmental liabilities which have contaminated their water sources with heavy metals and led to dangerously high toxins (many of which are present in children). With few exceptions, these communities have had their waterways affected by mining and industrial activity.

Ambassador Marcotte tweeted several photos from the meeting, using the occasion to promote mining as a benefit for communities and to express Canadian support for the upcoming Peruvian delegation who will attend the Prospectors and Developers Association of Canada’s (PDAC) annual conference in Toronto from March 5 to 8. Each year, the world’s largest mining convention draws tens of thousands of industry experts, company officials, and government representatives to talk industry trends and promote an expansion of mining—with little concern for the consent of those most affected, including in Peru.

At the time of the meeting, Lima was gridlocked with demonstrations calling for new elections and a constituent assembly. Only days prior, 17 people were killed by police in the cities of Juliaca and Puno. And in the days following the meeting, the oldest university in the country, San Marcos, was invaded by armoured tanks. Hundreds of students and rural protestors were detained, strip searched, assaulted and deprived of their rights. Fifty-nine people have reportedly been killed during the last few months—the overwhelming majority of them civilians from rural and periurban Indigenous and mestizo backgrounds—at the hands of an unbridled police force. It’s unlikely the ambassador could have moved around the city without observing repression and police violence.

For years, MiningWatch Canada and the Justice and Corporate Accountability Project (JCAP), alongside organizations including Red Muqui, Cooperacción, Derechos Humanos Sin Fronteras-Cusco and Derechos Humanos y Medio Ambiente DHUMA, have documented the many harms caused by industrial large-scale Canadian mining to rural communities, as well as the associated police violence that often accompanies the imposition of these projects. While the current protests in Peru are not explicitly about resource extraction, calls for a new constitution to address the systematic and often violent exclusion of Indigenous, peasant and rural peoples from the political economic system, as well as the legacies of land dispossession and contamination, are indeed linked to centuries of extractivism. The ambassador’s tweet has to be taken within a context of centuries of colonial and decades of post-colonial violence against rural peoples at the behest of resource extraction.

The Canadian embassy could have used the moment to publicly denounce police violence and insist the rights of Peruvian protestors be protected. Instead, Ambassador Marcotte chose to promote more Canadian mining investment in the country and plug PDAC 2023—where a session dubbed “Peru Day” promises to discuss “opportunities in the context of enhancing the virtues of the Peruvian mining industry and overcoming the flaws that have slowed down its dynamism in recent years.” Canada’s priorities in Peru could not be more clear.


Canadian Ambassador to Peru and Bolivia, Louis Marcotte, left, with Óscar Vera, Minister of Energy and Mines of Peru. 

Photo courtesy Ministry of Energy and Mines of Peru/Twitter.


The economic importance of Canadian mining in Peru

According to the Peruvian Ministry of Energy and Mines, Canada was the third most important investor in mine construction in 2021. Canadian companies invested over $8 billion in 10 projects, representing 15 percent of total investment in mine construction in the country. Canadian companies were the second most important player when it came to exploration (unsurprising, given Canadian companies typically focus on prospecting and exploration) representing 28 percent of the total investment in exploration, with $165 million spent on 21 projects.

Canadian companies are also operating mines in Peru. Toronto-based Hudbay Minerals operates the Constancia mine; Vancouver’s Pan American Silver operates the Shahuindo and La Arena mines; and Teck Resources’, also headquartered in Vancouver, operates the Antamina mine, with a 22.5 percent ownership stake in the project. Antamina is Peru’s largest mine, ranking among the top 10 producing mines in the world in terms of volume, and is the single most important producer of copper, silver, and zinc in the country. In 2021, the mine generated over $6 billion in revenue and nearly $3.7 billion in gross profits.

Canada also ranks high in terms of importing Peruvian metals and minerals. Of the total value of Peruvian mineral exports in 2021, Canada was the third most important global importer after China and India—coming in at 6.5 percent of total exports. This importance becomes even clearer when considering gold, as Canada was the second largest importer of Peruvian gold. Canadian imports represented over $3 billion in 2021, just shy of two percent of Peru’s GDP for the same year.

When it comes to making statements about egregious human rights violations in the country, however, Canada’s position has been lukewarm. Canada signed the most recent OAS statement on the political crisis in Peru—a watered-down declaration which assigns blame, and thus responsibility, to both protestors and the government of Peru as if they were equal players. The Canadian government continues to parrot this position, even as almost all the victims over the past several months have been civilians killed by an indiscriminate use of police violence—by the same national police force that has signed contracts to provide security to Canadian mining companies.
Private contracts with police

When Canadian mining companies are embroiled in a conflict with local communities outside of Peru, they often depend on henchmen or paramilitary forces to repress dissent. In Peru, companies benefit from state-sanctioned police protection and impunity. Companies can sign service contracts directly with the National Peruvian Police, and off-duty police officers are permitted to work for private security companies while using state property, such as weapons, uniforms and ammunition. Police are guaranteed immunity from criminal prosecution in the event that they fatally injure a protestor. They have the authority to use live ammunition and shoot to kill. And they’ve used it.

Mining companies also benefit from unfettered securitization of their assets. According to local sources, Hudbay’s Constancia mine and MMG’s Las Bambas operations have been fortified under the pretense of “preventing attacks on the mine camps”—effectively state-provided protection that serves to solidify the dominance of these companies in the regions where they operate.

Violence isn’t only used against rural peoples at blockades or during massive marches; it’s a daily occurrence which, according to several international and Peruvian non-governmental organizations, threatens the safety of human rights and environmental defenders and prevents them from exercising their rights. As one report notes, the “existence of these [security] contracts [with the police] creates a hostile scenario that puts human rights at risk.” As the Cusco-based organization Derechos Humanos Sin Fronteras has demonstrated through several environmental and social impact studies related to Hudbay’s Constancia mine, these contracts not only permit explicit state violence, they also form the backdrop of racialized and class-based intimidation and threats against community leaders to prevent them from speaking out against these contracts in the first place.

Promoting Canadian mining at PDAC

During the 2022 PDAC conference, the Peruvian Episcopal Commission for Social Action (CEAS) wrote an open letter to the conference delegates expressing that, contrary to the promises made by Ambassador Marcotte and others, mining has “not brought the promised improvement in quality of life” for most communities in the mining areas. On the contrary, she wrote, “it has resulted in corruption and environmental contamination and has infringed on people’s rights to life and health, leaving behind social conflict, disease and even death.”

These harms are not minimal: contamination of agricultural lands and waterways around Pan American Silver’s Quiruvilca mine and the criminalization of community leaders and land dispossession due to environmental contamination at Shahuindo; violation of Indigenous self-determination and the right to a clean environment around Plateau Energy’s proposed lithium and uranium mine, sitting atop the region’s most important tropical glacier; undercutting of economic benefits for communities most affected by mining operations, and more.

Yet the Canadian embassy in Peru has a track record of ignoring the concerns of human rights and environmental defenders affected by Canadian mining projects in the country—even ignoring the concerns of Canadian citizen Jennifer Moore who was detained in 2017 by Peruvian police while screening a documentary film with Quechua communities affected by Hudbay’s Constancia mine. Moore, who was subsequently banned from re-entering the country and labelled a threat to national security, is the focus of a recent report by the Justice and Corporate Accountability Project (JCAP) on the role of Canadian embassies in prioritizing the interests of Canadian mining companies at the expense of their own policies and commitments regarding the protection of human rights defenders.

The Canadian embassy in Peru will no doubt continue to work alongside the Peruvian Ministry of Energy and Mines to promote more Canadian mining investment in the country. But it should be made clear: when the embassy chooses to promote mining in Peru during PDAC, it is doing so knowing the reality of what these activities mean for people who are facing ongoing threats, intimidation, and explicit state-sponsored violence.

Dr. Kirsten Francescone is an assistant professor in International Development Studies at Trent University and former Latin America Program Coordinator for MiningWatch Canada.

Peru protesters temporarily lift mining highway blockade, sources say



 Protest against the suspension of the Las Bambas mine, in Lima

Wed, February 22, 2023
By Marco Aquino

LIMA (Reuters) - Peruvian protesters have temporarily lifted blockades of a key mining highway in the country's south, sources told Reuters on Wednesday, a boost for activity at major copper mines that saw activity hit in recent weeks as supplies were choked off.

The "mining corridor" highway, an important transport route for mines including Glencore Plc's Antapaccay and Las Bambas, owned by China's MMG Ltd, has in recent days been unblocked after weeks of protests, the sources said.

"The corridor is clear, some sections are damaged, but it is free," said a source close to Las Bambas, which normally provides some 2% of global copper supply, though saw mining activity significant reduced in recent weeks.

"We were in a state of maintenance care, with minimal production so as not to have to stop," the person said. Las Bambas has a long history of dealing with community protests that have at times stymied operations in recent years.

Las Bambas: maintenance mode?

 https://www.reuters.com/graphics/PERU-MINING/klvygdlojvg/chart.png

Anti-government protests have hit Peru, the world's no. 2 copper producer, since the Dec. 7 ouster of leftist President Pedro Castillo, who illegally tried to dissolve Congress and reorganize the judicial system. Blockades have affected mines, hitting shares and buoying prices of the metal.

The number of blockades has declined over the last week to around 37 on Wednesday from more than a hundred in January, with talk of a "truce" around the recent festive Carnival period, an important holiday in the region.

"With this truce we are gradually returning to operations, progressively, but we don't know what will happen next," said a source close to Antapaccay, who said the mine has stopped production in mid-January but since resumed at minimum levels.

Publicly available power use data analyzed by Reuters shows that Las Bambas has seen sharp swings in activity since a drop in early February due to a lack of key supplies. Power use at Antapaccay has been under 50% normal levels since Feb. 9.

Antapaccay: 

Protest hit https://www.reuters.com/graphics/PERU-MINING/mopaklewlpa/chart.png

The sources said community members involved in protests were planning meetings in coming days and blockades could be resumed. Several communities in the southern Cusco region are expected to meet on Thursday to discuss their next steps.

The protests, which are calling for the resignation of new President Dina Boluarte, the closure of Congress, a new Constitution and early elections, have left 49 dead in clashes and 11 dead in accidents linked to the blockades.

Boluarte has looked to rally political support in recent days amid infighting amongst lawmakers over plans to bring elections forward to this year. She has also authorized payments to relatives of those killed on injured in the protests.

Peru Mines: 7-day average power use 

https://www.reuters.com/graphics/PERU-MINING/gdpzqdxqjvw/chart.png

(Reporting by Marco Aquino; Editing by Adam Jourdan and David Gregorio)

Peru protests jolt mine activity with Las Bambas, Antapaccay hit hardest

Reuters | February 16, 2023 | 

Las Bambas mine. (Image by MMG).

Peru’s top copper mines are starting to see activity hit harder by protests and blockades in the country’s southern Andes, power data reviewed by Reuters shows, with Chinese-owned Las Bambas and Glencore PLC’s Antapaccay currently worst affected.


The South American country, the world’s no. 2 producer of the red metal, has been roiled by protests since the Dec. 7 ouster of President Pedro Castillo, though mining operations had generally remained resilient until this month.


However, a Reuters analysis of daily power use data from COES, which represents firms in Peru’s energy sector, shows that at least two key mines are now regularly only drawing half their normal power as key supplies needed for mining operations run out, suggesting they are in ‘care and maintenance’ mode.

Those are MMG’s Las Bambas, Peru’s third largest copper mine, and Glencore’s Antapaccay, which have both been hit by blockades on a key mining corridor highway. Latest data up until Thursday showed both at half normal power usage.

Miners in Peru, however, have a long history of dealing with community protests which have at times caused long shutdowns, something not yet seen in the current nationwide anti-government protests where nearly 50 people have died in clashes.

The data backs this up, suggesting that mines are at times getting some supplies through the blockades, with Las Bambas in recent days see-sawing between full and half power use.


A source familiar with the matter told Reuters on Thursday that protesters had temporarily lifted blockades a day earlier on a key section of the mining corridor in Condoroma, Cusco, used by Las Bambas, Antapaccay and Hudbay’s Constancia.

They were, however, threatening to resume the blockade on Friday, the source added, underscoring the current uncertain environment which has hit the arrival of supplies to mines and transport of copper concentrate for export.

Antapaccay said on Monday that five fuel trucks had been attacked and vandalized while on route to the mine.

Representatives from Las Bambas, Antapaccay and Constancia were not immediately available to comment on whether they were receiving inputs for their operations or sending their concentrates in the two-day window with the blockades eased.

Other key mines including Peru’s largest copper mine Antamina, co-owned by Glencore, BHP Group, Teck Resources Ltd and Mitsubishi Corp, appear to be still drawing near normal levels of power, despite some temporary disruptions in recent months.

An analysis of power use by six key mine operators shows that combined electricity use levels have dropped overall since mid-January, with the biggest slide this month.

“The longer that the supply of raw materials remains hostage to the protests the higher the risk that affected mines either run at limited capacity or halt production entirely,” Capital Economics said in a note this week.

“Anecdotal reports and high frequency data suggest that ongoing civil unrest in Peru is beginning to choke off activity at key copper mines. But, if recent history is anything to go by, output can rebound rapidly so long as closures are brief.”

(By Marco Aquino and Adam Jourdan; Editing by Diane Craft)

Exclusive-Peru mines on power despite protests, though halt risk looms

A view shows a makeshift dwelling near an area where hundreds of artisan miners have found a rich seam of copper, in Peru

By Alexander Villegas and Adam Jourdan

Wed, February 8, 2023 

ESPINAR, Peru (Reuters) - Peru's biggest copper mines have been able to maintain production despite road blockades, attacks and protests that have roiled the Andean nation for over two months and led to warnings of production halts, an analysis showed on Wednesday.

The analysis of power usage data by Reuters at some of the key mines in Peru, the world's no. 2 copper producer, indicates that activity at the deposits remains near normal levels, although a source close to one major mine said the risk of stoppages was rising.

The South American nation has been gripped by anti-government protests since the Dec. 7 ouster of leftist President Pedro Castillo. Highways have been blockaded throughout the copper-rich south, threatening production and transport of the metal, hitting some company shares, and boosting already high prices.

But the data suggests mining activity has been resilient, at least for now.

This includes massive deposit Las Bambas, owned by China's MMG Ltd, which previously said it would have to halt production from Feb. 1, and Glencore's Antapaccay, which stopped production in mid-January but has since resumed.

The power data from COES, which represents firms in Peru's energy sector, shows that nearly all major mines are drawing normal or near-normal levels of electricity. The data has traditionally been a reliable indicator of mining activity.

GRAPHIC: Peru Mines: Power use 

https://www.reuters.com/graphics/PERU-MINING/zjpqjwqokvx/chart.png

A source close to Las Bambas said the mine, which previously said it faced a production halt from Feb. 1 due to key provisions not reaching the mine, said it had been able to keep operating at a minimum level after getting "last minute supplies."

The mine, which normally supplies some 2% of global copper, has been hit by regular blockades for years, usually causing its power use to fall sharply during the periods of disruption. This has not yet happened this time around, despite the protests.

The person added, however, that the mine risked fully running out of supplies by Wednesday, which would force it to move into a "care and maintenance" mode with its machinery that would use half the normal level of power.

GRAPHIC: Las Bambas: Power and protest 

https://www.reuters.com/graphics/PERU-MINING/gdvzynngzpw/chart.png

The data shows some mines experienced temporary dips in power use in recent months, including Peru's largest mine Antamina, co-owned by Glencore and BHP, and Glencore's Antapaccay around the middle of January.

Antapaccay reopened on Jan. 31 after a temporary halt and has been operating again at full capacity.

Hudbay Mineral Inc's Constancia mine has seen power use start to decline recently. Others, like Freeport-McMoRan's Cerro Verde are at normal or elevated levels. A combined index of six key mines is near normal.

Freeport-McMoRan spokesperson Linda Hayes said: "We are continuing to operate, but have limited our mill throughput by about 10% to deal with intermittent supply disruptions."

The other firms did not immediately respond to requests for comment about activity at their mines in Peru.

The mining activity is key to keeping global copper supply flowing. Brokerage Jefferies said in a Jan. 31 note that some 30% of Peruvian copper supply was at risk from the unrest, a "potential positive for the copper price."

The protests - which have led to the deaths of 48 people and are the worst violence Peru has seen in over 20 years - could of course soon start to have a greater effect on mining operations. Demonstrators are becoming more determined as lawmakers struggle to agree on calling snap elections, a key protest demand.

This week, Peru's Buenaventura suspended operations at a key silver mine after protesters invaded the site.

At a blockade on the "mining corridor" highway, protester Wilber Toco Aragua Salcedo told Reuters that people felt like the mines took all the wealth and left little for locals.

"The south is quite rich, but the mining concessions that we have harm the people," he said, adding he had heard mines were stocking up on supplies. "The people do not get tired, the people won't go away, we will not take a step back."

GRAPHIC: Peru: mines and power 

https://www.reuters.com/graphics/PERU-MINING/byvrlkoxave/chart.png

(Reporting by Alex Villegas in Espinar and Adam Jourdan in Buenos Aires; Additional reporting by Ernest Scheyder, Melanie Burton, Valentine Hilaire and Fabian Cambero; Editing by Rosalba O'Brien and Bernadette Baum)