* First emergency of Humala's term over social conflict
* Gov't says protesters intransigent after mediation fails
* $4.8 bln gold mine plan by U.S. firm Peru's biggest ever
By Terry Wade and Omar Mariluz
LIMA, Dec 5 Security forces fanned out across
Peru's Cajamarca region on Monday to enforce emergency measures
decreed by President Ollanta Humala to put an end to 11 days of
protests against a $4.8 billion gold mine project.
Humala, a former army officer, called leaders of the
environmental protest "intransigent" after weeks of mediation
efforts failed again late on Sunday - prompting him to give the
military and police extraordinary powers to end rallies that
have shut roads, schools and hospitals in Cajamarca.
Protesters say U.S.-based Newmont Mining's Conga mine would
hurt local water supplies and demand that it be canceled. But
the government says the largest mining investment in Peruvian
history would generate thousands of jobs and huge tax revenue.
The conflict has tested populist Humala's resolve to govern
as a moderate who can simultaneously help Peru's poor and keep
big business happy. Critics had urged the president to take a
firmer hand in breaking up the strike, saying left-wing groups
had infiltrated the protest marches by local residents.
"Normal activities are resuming. People are returning to
work, going to school and reopening stores," Interior Minister
Oscar Valdes said in Cajamarca, nearly 620 miles (1000 km)
north of the capital Lima.
"The problems of water and the mine need to be resolved.
The government doors are open to dialogue. This constitutional
decree shouldn't alarm anybody," he said on RPP radio.
The decree marked the first time Humala, a former army
officer, has used special powers to defuse a social conflict
over mining in Peru, where disputes in some 200 communities
across the country threaten to delay billions of dollars in
planned mine and oil projects.
Humala won the presidency in June on promises to steer more
social spending to rural towns to help calm social conflicts
over natural resources while assuring companies their
investments would be safe in Peru's surging economy.
He has said the project by Newmont would benefit
all of Peru. It has gold deposits worth about $15 billion at
The impasse has highlighted Humala's struggle to neutralize
Peru's polarized political environment. He has urged dialogue
to solve the dispute, but a week ago the government was forced
to ask Newmont to temporarily halt work on the Conga mine after
the protests turned violent.
Since then protesters have continued to march and demand
the government scrap the project altogether.
Gregorio Santos, the governor of Cajamarca region who has
led the protests, said residents would return to their normal
life on Monday but continue to peacefully oppose the mine.
"The president lacks the power of persuasion so he has had
to resort to the power of guns. When you can't convince with
words you rely on gun barrels," an angry Santos told Reuters.
Prime Minister Salomon Lerner negotiated on Sunday for
hours with leaders of the protest but could not reach an
accord, leading Humala to invoke a tool his predecessor, former
President Alan Garcia, frequently used to quash protests by
suspending freedom of assembly.
The state of emergency decree came after a protest against
a prison expansion project spiraled out of control on Friday in
the coastal city of Canete, killing one protester in a clash
with police that appeared to catch the government off guard.
Though the death was unrelated to hundreds of environmental
disputes nationwide that Humala has promised to end, it was the
first stemming from a protest since he took office in July.
A local environmental group, regional mayors and Santos say
the Conga mine would displace a string of alpine lakes with
reservoirs and hurt farmers. Other protesters worry about
pollution or not getting what they say is their share of direct
economic benefits from the mine in a rural area where poverty
While protesters criticize Humala for moving too far to the
right and embracing foreign investment, his government has
urged Newmont to set up funds for social and environmental
programs in a bid to win support for the mine.
Newmont has said its environment plan for the mine, which
was approved a year ago by the government, meets the highest
standards in the mining industry. It also runs extensive
community outreach programs out of its nearby Yanacocha gold
mine, some of which were developed after a mercury spill in
2000 that angered local residents.
The Conga project, which Newmont owns with Peruvian
precious metals miner Buenaventura , would produce
580,000 to 680,000 ounces of gold a year and open in 2014. It
sits 13,800 feet (4,200 metres) high in the Andes.(Reporting by Terry Wade and Omar Mariluz; editing by Anthony