After two weeks of protests by indigenous groups, the world’s second-biggest ferronickel mine has been shuttered by BHP Billiton, halting 4% of global output in a major blow to Colombia’s mining sector. Citing worker safety for the closure, Cerro Matoso officials revealed little about protestor demands beyond “monetary indemnification;” Anglo-Australian BHP is a top diversied miner.
One mining ministry source quoted by Reuters, however, said the 6,000-strong protesters are demanding compensation alleging health complications from what they called pollution from the open cast project. “There will be no production or activities until conditions enable the company to operate normally,” said company officials in a statement, saying it will be a matter for the courts.
In a statement, Colombian Mining minister Amylkar Acosta called on the Zenu people to stop blockading the site which combines a lateritic nickel ore deposit with a low cost ferronickel smelter, producing high-purity, low-carbon ferronickel granules. The asset is located in Montelibano, in the northern municipality of Cordoba.
Company officials, meanwhile, said they are actively working to prevent potential irreversible mechanical damage to electric furnaces should their operations be disrupted long enough. The ministry offered to set up a new indigenous reserve and carry out health and environmental impact studies.
In all, Colombia’s ferronickel production surpassed 47,000 tons in 2012, according to National Mining Agency data; the Reuters source added that Cerro Matoso also generates $185,000 daily in government revenues via royalties.
The mining sector of Latin America’s No. 4 economy has had a rough year overall – especially its coal coal industry – with strikes at top two producers, Cerrejon in which BHP also has a stake, and the Alabama-owned Drummond Co. Inc. Activities by paramilitary forces and Marxist insurgents in the countryside have also bedeviled logistics across one of the region’s most highly mineralized nations.
