Living in Peru : your everyday companion

Living in Peru
Israel J. Ruiz

Protesting a law passed by President Alan Garcia as a part of Peru's free trade deal with the United States, indigenous groups are holding a police captain hostage.

Police Captain Gabriel Ramírez Quijandría and Officer José Rodríguez Salazar were taken hostage by natives in Peru's Amazonas region when protestors and national police clashed on Sunday afternoon.

The officers were taken by protestors as they attempted to clear a blocked water canal that feeds one of the region's hydroelectric plants.

While protestors set Officer Salazar free on Monday morning, it was reported they still have Captain Ramirez in their custody.

Protestors surrounded several of the country's energy installations nine days ago demonstrating their opposition to a law that makes it easier for national and international companies to purchase land belonging to communities.

As opposed to the past, when investors needed two-thirds of the community's support to buy or lease land, large companies can now use the property with the majority of the community's approval.

Indigenous communities from more than sixty ethnic groups have shut down an oil pipeline in northern Peru owned by state-run company Petroperu, occupied the El Muyo hydroelectric power plant in Amazonas region, overrun a great deal of Pluspetro, which sits in the Camisea natural gas field, and blocked major highways and wharves.

Peruvian president Alan García Perez denied there is an energy crisis in the country and said the government must be careful with the increasing use of gas-produced electricity due to the lack of rain to generate electricity.

The Peruvian leader mentioned there has been a lack of rain in the country and it is necessary to balance the use of gas-produced and hydro electricity.

García is presently visiting Peru’s southern towns to inspect reconstruction efforts being made by government bodies one year after a powerful earthquake killed some 500 people.

President García noted that the growth rate in household and industrial electricity consumption has been a kind of "boom in the country" due to higher productivity and an increased number of houses.

On the other hand, García pointed out that the government has invested 1.1 billion soles in reconstruction projects in the departments of Huancavelica, Ica and Lima, which was also affected by last year’s earthquake.

In addition, he highlighted the investment of 80 million soles in the construction of 20 schools in the towns of Chincha, Pisco and Ica, benefiting over 26,000 students.

News source: ANDINA

During the first seven months of this year, gold production in Peru registered an increase of over 15 percent, before the best prices on the international markets, reported today the president of the National Institute of Statistics and Informatics (INEI), Renán Quispe.

Gold production is picking up, after the decrease seen last year; and this rise is mainly in Cajamarca which is boosted by the international price increase of this commodity that pushes companies to produce more.

According to the National Society of Mining, Oil and Energy (SNMPE) statistics, gold production in fine content amounted to 207,822 kilos in 2005, while in 2006 it decreased to 203,286 kilos and in 2007 also decreased to 170,127 kilos.

News source: ANDINA

Peru's Buenaventura's 2Q profits up 571 percent

Peruvian miner Buenaventura said Wednesday that net income rose 571 percent in the second quarter, compared to an exceptionally low period in 2007. Profits shot to US$121.7 million or US$0.48 per share, up from US$18.2 million or US$0.07 a share, a year ago, Compania de Minas Buenaventura SAA said. The Lima-based miner had posted abnormally low profits during the second quarter of last year, when it was hit with nonrecurring expenses including a one-time charge of US$64.7 million against hedging-related losses, CEO Roque Benavides said in a statement. (AP - click here to read complete article)

Usmanov buys into Australian miner to develop iron ore in Peru

Gallagher holdings, Usmanov's investment company, will buy 37 million shares for AU$2.75 apiece.  Approval will be sought from Strike shareholders and the Australian Foreign Investment Review Board before the purchase can be completed. Strike will use the money raised to develop a 2.3 billion dollar iron ore project in Peru. (Russia Today - click here to read complete article)


Cascadia and Quippu Stake First Base Metal Property in Southern Peru as Part of the Strategic Alliance Agreement

Cascadia International Resources Inc. is pleased to announce that it has staked a 800 hectare base metal property in southern Peru as part of its Strategic Alliance with QUIPPU EXPLORACIONES SAC. The area was chosen for staking based on a technical evaluation by Cascadia and Quippu using in-house expertise to target hydrothermal alteration systems commonly associated with large porphyry and skarn type base metal deposits. (Marketwire - click here to read complete press release)


Peru wants pond at Coricancha relocated

Last Friday, July 18, the government of Peru issued a 60-day state of emergency regarding the tailings area at the Coricancha polymetallic mine 90 km east of Lima. The mine is owned by Vancouver's GOLD HAWK RESOURCES that purchased the mine in March 2006, refurbished the mine and mill, and achieved commercial production on Oct. 1, 2007. Government officials fear the tailings dam may fail, seriously polluting the Rimac River which is the main source of drinking water for Lima. (Canadian Mining Journal - click here to read complete article)


Dorato Confirms Presence of Widespread Gold Mineralization at Its El Tambo Property, Cordillera del Condor Project, Peru

Dorato Resources Inc. is pleased to announce that initial sampling has confirmed the presence of widespread gold - silver mineralization on its El Tambo Property, Cordillera del Condor Project, Peru. The average of all samples collected to date (N equals 155), including unaltered rock for comparison purposes, is 1.71 g/t Au. (StreetInsider - click here to read complete press release)

Peruvian mining exports will total 19.2 billion dollars this year, which represents a 30 percent increase when compared with sales in 2006, which amounted to 14.7 billion dollars, estimated Peru’s president Alan García on Monday.

During his message delivered on July 28 at the Peruvian Congress, he indicated this export growth is based on the increase in mining companies’ production in Peru.

“For instance, cooper production in 2006 was about 1.04 million tons and this year it will be around 1.30 million tons; zinc was 1.20 million tons in 2006 and the present year will represent about 1.53 million tons”, he stated.

However, he urged to have formal mining jobs without abuse of outsourcing companies, with a redistribution of profits and respect to all workers.

“I am sure Congress, in its first working-days, will discuss and approve the law which allows an unlimited distribution of mining resources among all workers employed in a mine”, he said.

The president indicated that in 2006, 600 million dollars were given to the regions and municipalities as mining canon, and this number increased to 1.48 billion dollars in 2007.

“This year, the number will reach 1.82 billion dollars that I am sure will be invested in infrastructure for the poorest by the regional and local governments”, he stated.

News source: ANDINA

More than six thousand rural towns will be provided electric energy in 2011, benefiting two million poor inhabitants, affirmed on Monday Peru’s head of State, Alan García Pérez, during his National Day message.

Addressing Peruvian Congressmen and women, he said that up to now, 760 remote towns have electric service, benefiting 448,000 inhabitants.

In addition, he said that 257 small urban towns have been provided electricity, benefiting 360,000 people.

News source: ANDINA

Doe Run Peru has announced improvements in the environmental indicators at its metallurgical complex in La Oroya, including a reduction in stack emissions of 74 percent at the end of June compared with October 1997, when DRP took over the complex.

Total emissions of particulate material dropped to 38 micrograms per normal cubic meters (mg/Nm3) vs. the 147 mg/Nm3 emitted in 1997. The maximum permissible limit for this indicator is 100 mg/Nm3.

These results are part of the process of Doe Run Peru's progressive environmental improvements at La Oroya, said Jose Mogrovejo, the company's Vice President of Environmental Affairs.

Mogrovejo called the progress a tribute to process improvements that have been put in place, particular attention paid to the issue by the company's operations team, and to timely implementation of environmental projects designed to control stack emissions, as part of the company's environmental operating agreement with the state (known by its Spanish acronym PAMA).

Market Watch
Complete Press Release

The upgrading of the 854 km North Peruvian Oil Pipeline for transporting heavy oil will require an investment of $840 million, the head of state oil company Petroperu, Cesar Gutierrez, said today.

He explained that the amount is based on the feasibility study prepared by the US company Mustang Engineering, whose report was handed over to Petroperú.

"Mustang has already given us the feasibility study, now we will start a basic engineering of this project and we hope that construction will begin next year," he said to Andina.

He added that the feasibility study determined that the project shall be done in two phases: the first would be the installation of small pipelines parallel to some areas of the pipeline, known as loops, and the second would work on improving the main pipeline.

It should be noted that the loops project will require an investment of $ 50 million, additional to the $840 million for the modernization of Petroperú. The amount earmarked for loops could be financed with Petroperu's own resources and would be ready in December 2009.

News source: ANDINA

Maple Energy Eyes More Peru Ethanol Projects

Peru's Pacific desert coast is home to less than 2% of the Andean nation's water supply, but to Rex Canon, it's the perfect place to grow sugarcane for ethanol. "It's an ideal place to grow cane," said Canon, chief executive of Maple Energy PLC (MPLE.LN), a Dallas-based energy company that has operated in Peru since 1992. Last year, Maple purchased from the Peruvian government 10,676 hectares – an arid piece of land in the northern Piura region that will soon be home to Peru's first fully integrated ethanol project, worth more than $180 million. (Dow Jones - click here to read complete article)


Horizonte signs mining deal with Barrick in Peru

Horizonte Minerals, the AIM listed mining group working in Brazil and Peru, has agreed a deal with industry giant, Barrick Gold Corp, to explore and acquire its 2147 hectare Pararapa gold property in southern Peru. The move could signal the first of a number of possible deals between the two companies. As part of this agreement, Barrick’s subsidiary Placer Dome del Peru will be issued with 3.5m new shares in Horizonte, payable in two tranches after 12 and 24 months respectively. (Small Cap News - click here to read complete article)

Outotec Wins $150 Million Peru Contract From Southern Copper

Outotec Oyj, whose flash smelting technology produces about half the world's copper, won an order valued at $150 million to supply a copper extraction line for mines in Peru's Arequipa region. Outotec booked $90 million of the order from Southern Copper Corp. in the second quarter, the Espoo, Finland-based company said today in a Hugin newswire release. (Bloomberg - click here to read complete article by Diana ben-Aaron)


Drilling commences on Block XXI, Onshire Peru

Gold Oil, the AIM listed oil and gas explorer and producer with assets in Colombia and Peru, today announces that the spudding of well SA-2X commenced over the weekend. Drilling is expected to reach a target depth of 5,200 feet and take approximately one month to complete. Block XXI was acquired as a high risk-high reward block but the results of SA-1X and recent geophysical work reduces the risks for this well but there is still a large exploration upside associated with the well and the rest of the block. (Trading Markets - click here to read complete press release)


Peru hit by mine pollution emergency

Peru has declared a state of emergency at a mine near Lima over fears that arsenic, lead and cadmium from its tailings dam could pollute the main water supply for the capital. Gold Hawk Resources, of Canada, confirmed the government has asked it to stop operations and relocate its processing plant and tailings dam from the Coricanca mine in the Tamboraque hillside region, which has been weakened by seismic activity and subterranean water filtration. (FT.com - click here to read complete article by Naomi Mapstone)


Nirek Signs a Letter of Intent to Acquire 45% of a Gold Producing Property in Peru

Nirek Resources Inc. is pleased to announce it has signed a Letter of Intent to become a joint venture partner with a 45% working interest in the AMR Project Peru S.A.C. The AMR Project Peru is 500 leased hectares in the district of Ayapata, in the province of Carabaya in the department of Puno, Peru. (Market Watch - click here to read complete press release)


Strike plans suspended at Southern Copper Peru

A strike planned to start on Monday at Southern Copper's Peruvian mine Cuajone has been temporarily suspended pending mediation, officials from the company and union said. Southern, one of the world's largest copper producers, has been hit by strikes this year in Peru as workers demand a larger slice of the country's economic boom. (Reuters -click here to read complete article)