On Thursday, in a statement Australian copper miner MMG said, after December 18, it would shut production at its Las Bambas copper mine in Peru. The development comes after it failed to reach an agreement with a Peruvian community which has blocked a transport road to the facility.
Since November 20, residents of Peru’s Chumbivilcas province have blocked the road to the mine leading to the shutdown of copper production at the Chinese-owned mine, which accounts for 2% of the world’s copper supply.
Peru is the world’s no. 2 copper producer.
With the news reaching the market, shares of the Hong Kong-listed company fell by 12% before recouping some losses to trade at 7.4% lower at HK$2.25, as of 0220 GMT.
The point of contention is a dirt road used by Las Bambas to transport copper to a seaport. Residents from several regions who live along the road have complained that the dust raised by the trucks pollutes their crops and affects their livelihoods.
“These dialogues sometimes can include delays, because reaching a consensus is not easy,” said Peruvian Prime Minister Mirtha Vasquez. “But we cannot sustain this situation for much longer.”
The leader of the Chumbivilcas have described the latest proposal by the company on jobs and contributions, as a “joke.”
According to MMG, stockpiles on the site are around 60,770 tonnes of copper concentrate.
“The company continues to request the immediate removal of the illegal roadblocks to facilitate transparent, open and constructive dialogue,” said MMG in a statement.
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