MAC: Mines and Communities

Peruvian congress grants Doe Run 30-month extension on cleanup deadline

Published by MAC on 2009-09-29
Source: Reuters, Bloomberg

Condemned by the Blacksmith Institute three years ago as one of the world's "worst polluted" places, Doe Run's La Oroya smelter in Peru continues attracting outrage from environmentalists and health workers - but backing by its workforce.

Last week, the country's Congress voted to extend the deadline by which the US company should finally "clean-up" its dirty and damaging operations - a deadline that's already been missed on more than one occasion.

Two days earlier, police violently cleared road blocks, mounted by some of the company's workers, leaving one dead and another wounded.

Peru's justice minister accused Doe Run of "directly manipulating" the workers, to back its  dubious "cause." See also:


Peruvian congress extends Doe Run deadline
Environmental clean-up extension granted as almost 20,000 jobs are at stake in La OroyaBy Teresa Cespedes, Reuters
25 September 2009

LIMA - Peru's Congress voted on Thursday to give the financially troubled Doe Run Peru smelter a 30-month extension on its environmental cleanup deadline, possibly paving the way for a restart of operations.

Doe Run Peru, owned by privately held U.S.-based Renco Group, stopped production at its La Oroya smelter in June, when it ran out of money after banks cut off credit.

The company has said it could regain access to loans and restart production at the world's most diversified smelter if its deadline was extended.

The current deadline had been set to expire in October.

Congress passed the 30-month extension, which was 10 months more than a joint commission had recommended, by a vote of 85-to-1.

Almost 20,000 jobs are at stake in La Oroya, one of the most polluted towns in the world, according to an environmental study.

One policeman died and at least three others were injured this week in a clash with protesters demanding the government reopen the smelter.

Restart of operations?

Jose Mogrovejo, the company's vice president of environmental affairs, said late on Thursday that Doe Run would comply with the congressional extension and that operations at the smelter could restart within weeks.

The company had previously said it would need 36 months to complete the cleanup.

The 30-month extension now passes to Peruvian President Alan Garcia, who is expected to sign it into law. "We can't give an exact date, but I can tell you it'll be in a few weeks," said Mogrovejo about the possible restart of operations.

Doe Run Peru says it has so far spent $307 million scrubbing the smelter and may need to spend $150 million more to complete the cleanup. It owes some $110 million to its suppliers. (Reporting by Dante Alva and Teresa Cespedes; Writing by Dana Ford; Editing by Marguerita Choy, Leslie Gevirtz)


Peru Police Clear Doe Run Worker Roadblocks; 1 Dead
By Alex Emery, Bloomberg
23 September 2009

Peruvian police cleared roadblocks in the central Andes today after protests by Doe Run Peru smelter workers turned deadly.

Pollice battled the shuttered zinc and lead unit’s 3,700 workers to reopen the Central Andean Highway, which links key mining and farming regions to Lima, union spokesman Roiberto Guzman said today in a telephone interview. The smelter has been closed since June.

Some 1,200 police were deployed, with one killed and another wounded yesterday, officials said. The protests are aimed to pressure the government to help the company reopen the smelter, cabinet chief Javier Velasquez said.

Doe Run, a Renco Group unit, filed for bankruptcy last month after suppliers refused to sell it raw materials and banks halted lending in February.

“We hope the workers understand the government is working on this issue,” Deputy Mining Minister Fernando Gala told reporters today in Lima. “The executive has sent an urgent bill of law to Congress and we trust it will be passed as quickly as possible.”

Congress may vote this week on a plan to grant Doe Run Peru an extension of an environmental clean-up deadline that will give the company access to financing, Gala said. Doe Run is holding talks with creditors and aims to restart its smelter before the end of the year, said Doe Run Vice President Jose Mogrovejo.

“There’s a great deal of tension here,” Mogrovejo said today in a telephone interview from La Oroya, 140 kilometers (87 miles) east of Lima. “We’ve tried to appeal for calm among the workers, but it’s gotten out of our hands.”


A state prosecutor may press charges against the company’s general manager Juan Carlos Huyhua for his alleged responsibility for the deadly protests, Justice Minister Aurelio Pastor said.

“It’s clear that there’s direct manipulation by the company management,” Pastor told reporters in Lima after a cabinet meeting. “We’re not going to allow this to happen in a state of law.”

Mogrovejo denied the company had pressured the workers to protest.

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