Peru suspends key allow for Southern Copper in U-turn on Tia Maria challenge

LIMA (Reuters) – Peru on Friday suspended a lately issued building allow for Southern Copper’s Tia Maria mine, a challenge that has triggered violent protests by close by residents.

The allow will probably be suspended till authorities officers consider its legality together with objections from native authorities within the Arequipa area the place Tia Maria, a $1.four billion challenge, could be constructed, Vitality and Mines Minister Francisco Ismodes instructed native broadcaster RPP.

The overview will possible take two to 3 months, he mentioned.

Southern Copper Corp (SCCO.N), a unit of Grupo Mexico (GMEXICOB.MX), has sought to construct Tia Maria for practically a decade, however opposition from native farmers and residents who concern air pollution and lack of water provide has thwarted the hassle.

The mine challenge, anticipated to provide 120,000 tonnes of copper per yr, has been the main target of debate over whether or not the numerous tax revenues from mines outweigh the objections of people that dwell close to them.

Southern Copper didn’t instantly reply to requests for remark. Ismodes mentioned the allow was suspended to adjust to a unanimous choice by a authorities mining fee.

Peru’s enterprise neighborhood had applauded President Martin Vizcarra’s July 9 choice to grant a building allow for Tia Maria as an indication of his dedication to selling funding.

The suspended allow offers a recent blow to enterprise confidence in Peru amid slowing financial development, however it may assist calm violent protests in opposition to Tia Maria which have blocked $400 million in copper shipments from the port of Matarani.

Marco Arana, a leftist lawmaker and anti-mining activist, mentioned on RPP that native protest leaders in Arequipa would possible proceed to demand full annulment of the development allow, however its suspension may assist draw native authorities again to the negotiating desk.

Vizcarra initially defended Tia Maria’s building license as the results of a legally sound analysis. However earlier this month, beneath strain from regional governors, he ordered a overview of its legality to have in mind objections raised by native residents.

Southern Copper had publicly pressured Vizcarra’s authorities to grant a building license to maintain its environmental plan from expiring on August 1, which might have delayed the challenge by not less than one other yr.