Lima – The Yanacocha mining consortium announced the suspension of its controversial Conga project in the northwestern Peruvian region of Cajamarca, although authorities there say it must be permanently canceled to bring an end to violent demonstrations.
Local residents in Cajamarca have been protesting against the project for the past week, saying plans to use four highland lakes will cause irreversible damage to water supplies.
"Yanacocha wishes to inform the public that, in response to the demands of the federal government and with a view to re-establishing peace and tranquility in Cajamarca, it has decided to suspend the project's activities," the consortium said in a statement Tuesday during a press conference at the presidential palace.
The press release was read by Yanacocha representative Carlos Santa Cruz in the presence of Prime Minister Salomon Lerner.
The consortium, which includes Denver, Colorado-based Newmont Mining Corp., Peru's Buenaventura Mining Co. and the World Bank's International Finance Corporation, said it took the decision because "the conditions for a fruitful dialogue ... were limited" by the staunch opposition of Cajamarca residents.
It added that the Yanacocha consortium, whose properties include the Yanacocha mine, South America's largest gold producer, "always has been open to dialogue" but acknowledged that "it's aware that as concerns the population there have been misunderstandings and confrontations in the past."
The consortium will make its "best effort" to comply with "all the demands of President Ollanta Humala's administration for responsible mining," the press release said.
Lerner, for his part, said the government made a "patriotic decision" in demanding a halt to the Conga project - which comprises two main copper and gold deposits called Perol and Chailhuagon 2 and is currently in the exploration phase - and is seeking "responsible mining that ensures that the fruits of that activity benefit everyone."
The government has made it clear that "water must be used for human consumption, for housing and sanitation and agricultural development ... once those specifications have been met we're prepared to allow responsible mining," he added.
The prime minister announced that the government and the Yanacocha consortium will conduct "national and international assessments to (earn) people's trust."
"It's now up to the people of Cajamarca to say whether they want dialogue and negotiation to replace violence," he said, referring to demonstrators' clashes with police that left eight injured Tuesday.
In that regard, Lerner urged protest leaders to show "respect for the rule of law" and agree to pursue a negotiated solution.
Authorities in Cajamarca, however, demanded that the federal government issue a decree declaring the project unviable.
The regional president, Gregorio Santos, said the announcement of a halt to operations "is nothing new (because) Conga has been shut down for several days."
"I urge the prime minister and the president to heed Cajamarca's call (to declare) the Conga project unviable," he said.
The president of the Environmental Defense Front of Cajamarca, Wilfredo Saavedra, said for his part that demonstrators reject the proposal for dialogue with Yanacocha.
"We're not welcoming negotiations. We're waiting for a political solution that declares the project unviable. This press release doesn't change the situation," Saavedra said.
He said protests will continue in Cajamarca and that starting Wednesday solidarity demonstrations will also be held in the Amazonas, Piura, La Libertad and Lambayeque regions.
The Yanacocha consortium's plans for the Conga project call for investment of $4.8 billion and output of 8.9 million ounces of gold over 19 years.