On one hand mining companies operating in Peru, including NEM and BVN, agreed on August 24 to make "voluntary" windfall profit payments in the total amount of US$774 million which will be used to fund various community social programs as a result of negotiations with the administration of newly elected President Alan Garcia, which negotiations were headed on the miners' side by BVN Chief Executive Roque Benavides who complained that the negotiations were being conducted "under pressure".
On the other hand, four days later, mine officials had to announce the suspension of all operations at the Yanacocha gold mine, the largest gold mine in Latin America, which is operated by NEM and jointly owned by NEM and BVN, due to local farmer protests who are complaining that the mine is poisoning the neighboring streams while, at the same time, demanding that the mine's owners provide them with more jobs at the mine. Mine officials have demanded that the government act to clear the roadway to the mine, which is being blocked by some 90 protesters, but apparently, the officials are unwilling to act because they are wary of needlessly upsetting the locals.
While it is likely the case that many local communities are understandably upset at not seeing much of the upside from the rise in prices of locally mined metals, officials at BVN and NEM are undoubtedly not too thrilled that several days after agreeing to help fund local community projects, operations at their flagship mine are suspended as a result of the unwillingness of authorities to interfere with protests by local residents.
Related Articles:
"Major Peru Gold Mine Suspends Production"
[http://biz.yahoo.com/ap/060828/peru_gold_mine.html?.v=2]
"Miners to pay Peru $774 mln to avoid new royalty"
[http://yahoo.reuters.com/news/articlehybrid.aspx?storyID=urn:newsml:reuters.com:20060824:MTFH71418_2006-08-24_17-21-43_N24442784&type=comktNews&rpc=44]
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