Peru's Buenaventura CEO says no near-term Conga gold mine revival

LIMA (Reuters) - Buenaventura, Peru’s largest producer of precious metals, has no plans to restart its Conga gold mine this year or in 2018 and will instead focus on efficiency gains at four of its fully owned operations in the country, the company’s top executive said on Wednesday.

Victor Gobitz, CEO of Peruvian precious metals miner Buenaventura, speaks during an interview at the Reuters Latin American Investment Summit in Lima, Peru, August 8, 2017. REUTERS/Guadalupe Pardo

The company also plans to extend the working life of the Yanacocha gold mine, in which it has a minority stake, through 2025, Chief Executive Officer Victor Gobitz said in an interview at the Reuters Latin America Investment Summit.

Yanacocha, controlled by U.S. miner Newmont Mining Corp NEM.N, was once Peru's largest gold mine until output began falling in recent years.

Nearby Conga, in which Buenaventura is also a junior partner, was once expected to help offset Yanacocha’s dwindling production.

The companies are currently developing a project to mine copper sulfides at Yanococha, using the existing infrastructure.

“That’s our priority for now, and it will have a positive impact for the company,” Gobitz said in an interview in his Lima office, when asked when Conga operations would begin again. “The subject of Conga is not on the agenda of the coming months, this year or next year.”

Conga, a $5 billion project, was derailed by local protests over land rights and environmental concerns in 2011, and falling gold prices later led the company to decide the mine was not viable.

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However, the mine could be included in future plans to develop a slew of projects in Peru’s northern Cajamarca region, Gobitz said.

“Looking at the medium and long term, Conga is without a doubt on that horizon,” he said.


Gobitz said the company is studying ways to boost efficiency and improving infrastructure at four of its wholly owned operations: the Orcopampa and Tambomayo gold mines, the Uchucchacua silver mine and the Marcapunta Norte copper mine. The company will share the results of that study at the end of the third quarter, he said.

Tambomayo will produce 150,000 ounces of gold in 2018, up from 60,000 to 90,000 ounces in 2017, he said. The mine will likely reach a level close to its full capacity in August.

“Buenaventura expects higher production of gold and silver this year compared to last year due to the effect of Tambomayo,” Gobitz said.

At Marcapunta Norte, an expansion will be complete by the fourth quarter of this year, allowing the mine to boost annual output to 70,000 tonnes of copper from 40,000 tonnes currently.

Gobitz said that the company is developing its Yumpag silver mine this year and in 2018, and that it would begin production in 2019. The government has approved an environmental impact study at its San Gabriel gold mine, and the company has good relations with nearby farmers, Gobitz said.

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Reporting by Teresa Cespedes; Writing by Luc Cohen; Editing by W Simon