MAC: Mines and Communities

Peru industry body cuts off offending member, Doe Run

Published by MAC on 2009-07-07
Source: Business News Americas ()

Peru's dirtiest smelter has already been told to "clean up - or get out", both by the government and the country's national oil, mining and energy society, SNMPE. See: http://www.minesandcommunities.org/article.php?a=9264

Last week, the SNMPE went a step further - suspending US company, Doe Run, for breach of its code of conduct.

This is an unusual step for a pro-industry body to take, though it's unlikely that it will be followed by similar organisations elsewhere, confronted by the well-documented and unacceptable behaviour of companies like Barrick or Freeport-Rio Tinto.

SNMPE is one of thirty associate members of the London-based International Council on Mining and Metals (ICMM) which has framed several codes of best practice, but never imposed sanctions against offenders.

ESPAÑOL

SNMPE suspends Doe Run membership rights - Peru

Business News Americas

1st July 2009

Peru's national oil, mining and energy society SNMPE has suspended US-owned Doe Run Perú's rights as a member for non-compliance with the society's code of conduct.

The code of conduct requires companies to use mineral resources responsibly, make real and measurable contributions to the community, conduct business in an economically and socially sustainable manner, and fully observe the country's laws and norms.

SNMPE has sent a letter to Doe Run Perú communicating the decision, according to state news agency Andina.

The suspension could be followed by the company's full exclusion from SNMPE if it does not complete a series of cleanups and modernizations, called PAMA initiatives, at its La Oroya polymetallic smelter. Doe Run has an October 31 deadline to fulfill its PAMA obligations.

SNMPE started in March an investigation into the mounting financial difficulties that were endangering the company's ability to continue operations and environmental cleanup activities at La Oroya to determine whether there was a breach of the code of conduct.

The PAMA requirements were established when La Oroya was privatized in 1997. The company has carried out numerous improvement works at the plant, now nearly 90 years old, but has been unable to complete the requirements.

In June Doe Run Perú closed La Oroya on grounds it is unable to fulfill the PAMA efforts, despite its concentrate providers having signed on a US$175mn credit line after banks cut the smelter off earlier in the year due to low metals prices.

La Oroya - in central Peru's Junín department - produces 11 different metals but mainly copper, zinc, lead and silver. The town of La Oroya ranks among the world's top 10 most polluted sites according to the US-based Blacksmith Institute, principally due to lead contamination.

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