Steve Fiscor Publisher & Editor-in-Chief

Mining companies are growing concerned about the political situation that has emerged in Peru, which is now the second-largest copper producer and a significant gold producer. During July, Peru elected Pedro Castillo as its 63rd president. He was born and raised in Peru’s Cajamarca Province, a major gold mining district. Castillo is a member of the leftist Peru Libre (Free Peru) party and attained prominence during a 2017 teacher’s strike. He said he wants to increase tax revenue from the mining sector to fund social programs. He recently appointed Mirtha Vásquez as prime minister. Vásquez is a lawyer turned politician who represented Máxima Acuña in a land dispute case involving the proposed Conga project in 2016. She replaced Guido Bellido, who served as Peru’s prime minister for about two months.

Speaking on TVPeru, Vásquez assured viewers that she will embrace Castillo’s commitment to promote mining investment in Peru. “Many people think that, because I have defended environmental issues, I am anti-mining,” Vásquez said. “What I am suggesting is the need to tell companies that they have to work responsibly. What is needed is to regulate some conditions to work more adequately with the mining companies and that would allow the cessation of conflicts in certain areas.” Apologies to Vásquez for the poor translation.

President Castillo also recently appointed Eduardo Gonzalez Toro as the new head of Peru’s Ministry of Energy and Mines (Minem). An industrial engineer, he replaces Ivan Merino, who lasted about two months in that position after
announcing plans to rewrite Peru’s General Mining Law. The new Castillo administration has already seen significant turnover.

Meanwhile, in the interior of the country, it seems the villagers have taken these cues as an opportunity to extract more from mining companies. They have been setting up blockades along the “Mining Corridor,” between Arequipa, Peru, and the mines that lie as far as 400 km to the north. As this edition was going to press, villagers from the Espinar region were blocking a key route for Glencore’s Antapaccay mine. This blockade began the day after Minem settled with Chumbivilcas villagers, which were blocking the transportation route for MMG’s Las Bambas mine (see Regional News, Latin American News, p. 12). Las Bambas and Antapaccay are the fourth- and sixth-largest copper mines in Peru, respectively.

The villagers said they are protesting the environmental and social impacts of mining. The problem is that some of these blockades are 200 km or more from the mining operation. Which begs the question: How large is a mining company’s area of influence? Working through Minem, MMG has acquiesced and Glencore will likely do the same. At a time when the government should be protecting transportation routes, they are instead setting a precedent that will allow activists to hamstring a mining company anywhere along the pit-to-port route. In Peru, the Port of Matarani is about 560 km from the Las Bambas mine and a lot of other copper mines lie along that route.

What looms larger for Peru is the possible changes to its General Mining Law. The Castillo administration needs to do more to reassure mining companies that it values their presence and will protect their investments.