LIMA Aug 14 The Peruvian government said on
Thursday it hopes to ease local opposition to Canadian miner
Bear Creek's stalled Santa Ana silver mine and avoid a
costly legal battle with the company.
Energy and Mines Minister Eleodoro Mayorga told Reuters that
officials are rapidly building support for the project in
indigenous Aymara communities and that Peru hopes to be able to
allow the company to eventually restart work.
The previous government revoked Bear Creek's right to build
Santa Ana in 2011 after protests against the proposed mine in
southern Peru turned deadly.
The company has said the project's suspension violates
investor protections under Peru's free trade agreement with
Canada. On Tuesday, Bear Creek announced it started arbitration
proceedings in case talks with the government do not produce an
The company had planned to use Santa Ana to help pay for its
bigger, $700 million silver project in Peru, Corani. Bear Creek
expects Santa Ana to produce some 5 million ounces of silver per
year and Corani to produce about 13 million.
Chief Executive Andrew Swarthout said in an email that the
company would consider calling off the arbitration process if it
received "a good signal that we would be making progress towards
He said the company cannot disclose how much it was seeking
in damages for Santa Ana until its notice of arbitration has
been accepted by the World Bank's arbitration panel in
Mayorga said he thinks the dispute can be resolved soon.
"I see it with a certain optimism," Mayorga said in an
interview. "If we manage to resolve the social license in time,
we will be on our way to developing" the deposit.
But without strong local support, Mayorga said the project
will not go forward, and "Peru would be subject to paying the
Local residents in southern Peru's Puno region once staged
large protests against Santa Ana because of fears the project
would pollute water supplies.
Swarthout said the situation has changed.
"The communities have voiced their desire to at least hear
our proposed project and outside radical influence has
diminished," he said.
Peru is the world's third biggest copper and silver producer
and fifth biggest gold producer.
Peru's vast mineral wealth overlaps with hundreds of poor
communities in the Andes.
Conflicts over environmental concerns and the spoils of
mining proceeds have held up multi-billion dollar investments in
Mayorga also said the Las Bambas copper project, which
Glencore Plc recently sold to China's MMG Ltd
for $7 billion, will not face delays stemming from issues
relocating locals to a new town.
"The vast majority have been relocated. There are a few who
have stayed and the company is working...to wrap that up," he
said. "But from the conversations we've had, it is on schedule
and there will not be any delays linked to that."
(Reporting By Mitra Taj; Editing by Michael Perry)