Greenwood Village-based Newmont Mining Corp. announced Wednesday it was suspending development at its Peruvian Minas Conga mining project, citing the safety of their workers following violent clashes during nearly a month of anti-mining protests.
Newmont’s suspension of the $4.8 billion gold project – the largest underway in Peru – marks the fourth mining company in Peru to scrap investment in the country.
Farmers in Peru have organized a nearly weeklong protest of Conga, fearing Newmont’s water needs could dry up local water sources. They have clashed with police near Newmont offices in Cajamarca, northwest of Lima. Peru’s deputy environment minister resigned this week in protest the government’s support of the project.
Nationwide protests since October could derail $50 billion in mining investment in Peru over the next decade, according to analysts. The Andean country is the world’s third largest copper producer and sixth largest gold producer. The sweeping protests have suspended mining activities by Southern Copper Corp., Anglo American Plc and Bear Creek Mining Corp.
In a statement released Wednesday morning, Newmont said the Peruvian government approved environmental review of the Conga mine in 2010, following “significant engagement and consultation with local communities.”
“We believe that the multi-year approval process followed by Yanacocha and the Peruvian government for the Conga project thoroughly considered impacts to the environment, including water resources in the region,” said Richard O’Brien, Newmont’s President and Chief Executive Officer, in the statement.
Newmont will pursue “peaceful dialogue with local community leaders and government representatives,” according to the statement.
Newmont expected Minas Conga to produce 680,000 ounces of gold and 235 million pounds of copper a year. But Peru’s gold output has been declining, according to reports from the mining industry group National Society of Mining, Petroleum and Energy.
Newmont chief O’Brien said that his company could shift investment to Nevada, Canada, Ghana, Indonesia and Suriname should Newmont scrap the Conga project.
