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Anglo American strikes deal with Peru Michiquillay

LIMA, June 4 (Reuters) - Mining group Anglo American AAL.LAGLJ.J and the Peruvian community of Michiquillay have reached an agreement to start exploration at the company's copper project, a representative said on Wednesday.

London-based Anglo American, the world’s third-largest miner, won the concession for Michiquillay in April last year with a bid of $403 million. But development has been delayed by community and environmental-rights groups, who are worried that the project could damage the area.

Peru’s mining ministry issued a statement Tuesday night that acknowledged the deal and stressed the significance of moving forward.

“(Tuesday) Anglo American and the community of Michiquillay reached an agreement after 736 members of the community voted in favor and 432 voted against it (the project),” said the ministry.

“This result assures the start of exploration operations on this important copper project,” it added.

Michiquillay is located in the northern district of Cajamarca, some 560 miles (900 km) north of the capital, Lima. Besides copper, the property has gold and silver.

The exploration stage will likely take four years, after which infrastructure construction could start. The government has estimated the project will need at least $700 million in investment.

Peru is the world’s third-largest producer of copper, its fifth-largest producer of gold and its largest silver producer. (Reporting by Maria Luisa Palomino; Writing by Dana Ford; Editing by XXX)

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