Agreement Over Anglo American’s Quellaveco Seen As Example For Sector

An agreement reached between local governments in the south coast region of Moquegua and multi-national mining company Anglo American, to develop the Quellaveco copper project, is being praised as a small bit of positive news in a sector that has been mired recently in violent social conflicts.

At the end of last week, Peru’s government announced that Anglo American and Moquegua’s regional government reached an agreement after about a year and half of negotiations. As part of the agreement, Anglo American has made a commitment to spend 1 billion soles (approximately $382 million) in social development, while also giving jobs to the local population.

The agreement should allow Anglo American to develop Quellaveco, which will produce about 220,000 tons of copper a year and require an investment of about $3 billion. Construction should start later this year, with production beginning in 2016.    The project, at an altitude of 3,500-4,000 meters, has a probable mining life of 32 years. It is 37km northeast of the city of Moquegua. 

Like other large-scale mining projects in Peru, Quellaveco had been delayed due to opposition over concerns about its impact on the environment, most notably on the water supply.

Other projects that have been opposed by communities and local politicians include Newmont Mining’s Minas Conga gold deposit in the north Andean highlands of Cajamarca, Xstrata’s Tintaya copper mine in the southeast, north of Cusco, and Southern Copper’s Tia Maria red metal project in Arequipa. In all three of the disputes, protesters have been killed during violent clashes with police.

Peru’s biggest business organization, Confiep, said the agreement for Quellaveco shows the importance of dialogue to resolve social conflicts that threaten to halt other mining projects in the Andean country.

“We can take this as an emblematic case, that thanks to dialogue between regional leaders and the company it is possible to reach reasonable understandings,” Confiep vice-president Alfonso Garcia-Miro told state news agency Andina.

“This example should be replicated in other regions,” he added.

The former vice-minister of Environment, Jose de Echave, is more cautious. “There are models, one can follow certain lines of action, but not all conflicts are the same. Conga is not the same as Espinar and, of course, Espinar is not the same as Quellaveco,”  he said during an interview on Ideeleradio, adding that the discussion over environmental and social sustainability in the face of mining development “is a legitimate discussion.”

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