A Peruvian community wants its land back, threatening a Chinese copper mine

LAS BAMBAS, Peru, May 12 (Reuters) – The community of Fuerabamba in Peru’s Andean region was resettled eight years ago to make way for a giant Chinese-owned copper mine as part of a a $1.2 billion program touted as a model solution to the protests. hounding the mining sector of the South American nation.

Now the community wants to reclaim the land.

In mid-April, more than a hundred members of the Fuerabamba community stormed the Las Bambas mine and pitched tents near the open pit, forcing a halt to production at one site. which provides 2% of the world’s copper supply. They were joined by the nearby community of Huancuire, who were protesting a proposed mine expansion on their former lands.

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In late April, an attempt by Chinese mine owner MMG Ltd (1208.HK) to remove the camp sparked clashes in which dozens were injured and failed to end the protest . Copper production – worth $3 billion a year – remains suspended, with no restart in sight.

The Fuerabamba members were expelled but the Huancuire community remained – and the two groups formed an alliance to negotiate with the government and the mine.

Las Bamas acknowledges that 20% of its obligations under the resettlement agreement are outstanding, including the purchase of new land for the community.

While Fuerabamba leaders initially called Las Bambas only to fulfill their commitments, tensions have flared since the failed eviction.

“We are going to keep fighting until Las Bambas closes and gets out of here for good,” Edison Vargas, the Fuerabamba community president, told Reuters. “It’s the war.”

The protest is the most serious crisis Las Bambas has seen since it opened in 2016, throwing into question the future of one of the biggest investments ever made in Peru, the world’s second-largest copper producer, according to industry experts. .

The mine, which still has more than a decade of planned production, has faced roadblocks in recent years by more remote communities hitting its production. But the invasion marks a major escalation as well as the potential collapse of Peru’s most expensive community resettlement program, amid a resurgence in South America of protests against mining projects.

Some 1,600 members of the Fuerabamba community were relocated by Las Bambas in 2014 to a purpose-built village with tidy rows of three-storey houses near the mine. The community approved the move, which came with $300 million in cash payments, according to the company.

A Reuters reporter who visited Las Bambas in late April saw community members, including women and children, rebuild mud houses there and graze cattle against the backdrop of the open pit mine. . Residents of Fuerabamba and Huancuire said they would not drop demands for the return of what they called their ancestral lands.

They face long odds, according to former government officials and advisers. Both communities received substantial payments from Las Bambas in exchange for the land they now want back.

Leaders of Las Bambas – which is 62.5% owned by MMG, the Melbourne-based unit of state-owned China Minmetals Corp – say the protests are illegal and have called on authorities to enforce the rule of straight. The company declined requests for comment for this story.

On Tuesday, as the shutdown entered its third week, the Peruvian government failed to broker a deal in talks in Las Bambas with communities as the two sides traded accusations of violence.

Edgardo Orderique, general manager of operations at Las Bambas, said members of Fuerabamba and Huancuire destroyed tens of millions of dollars worth of equipment and injured 27 security personnel in clashes late last month. Vargas said a member of Fuerabamba lost an eye in the violence.

The protest underscores the depth of the challenge Las Bambas faces as it pursues its plans to increase annual copper production from 300,000 to 400,000 tonnes amid soaring global copper prices.

“This protest is the most serious Las Bambas has faced since it began operating in Peru,” said Ivan Merino, a former mines minister under Peru’s President Pedro Castillo, whose government is torn between its promise to defend the rights of rural communities – the basis of its support – and the need to revive the economy.

“The state does not have the control to resolve the conflict,” Merino said.

The Peruvian Ministry of Mines did not respond to multiple requests for comment.

THE FACE OF PROGRESS

In the main square of New Fuerabamba, the town that Las Bambas built, a plaque states that the settlement is the enduring “face of progress and hope”.

Nearly a dozen residents, however, said the abrupt transition from rural to urban life had caused trauma and mental health issues. Reuters was unable to independently confirm this.

Residents cited simple problems like the new brick houses – which have electricity and indoor plumbing – do not protect against the chill of cold Andean nights as well as their old adobe houses.

Residents have also complained that basic necessities like water, food and fuel – which the rural community could previously glean from the land – now have to be paid for. Many of them no longer farm or care for livestock because the replacement plots provided by Las Bambas are too far away.

“The problem is that sustainable development has not been achieved,” said Paola Bustamante, director of Videnza, a consulting firm, who was previously the top Peruvian official in charge of social conflicts in Las Bambas.

“What was done was they were given money and that was it.”

As part of the resettlement agreement, Las Bambas gave one job per family in the company for the life of the mine. The company also said in a 2021 presentation that health and education levels have also improved significantly, especially among young children.

Three residents told Reuters some community members had already spent their payments. The resettlement plan, which MMG inherited when it bought the mine from Glencore Plc (GLEN.L) in 2014, gave Fuerabamba residents cash settlements which the mine said averaged 500 000 dollars per family.

Residents say the payout was closer to $100,000.

Either way, that’s a huge sum in a country where the legal annual minimum wage is $3,300.

“For us it seemed like a lot of money, endless money,” Dominga Vargas, a Fuerabamba resident, told Reuters from the Las Bambas tented camp before the eviction. “But now everything is exhausted and we have nothing left.”

“How could we not regret selling,” she added.

THE GOVERNMENT IGNORES THE “CRITICAL SITUATION”

The government allowed MMG to expand the mine in March. Fuerabamba chief Vargas said Castillo’s administration had turned a deaf ear to his warnings of a brewing crisis and a request for mediation before the occupation took place.

In a March 28 letter seen by Reuters, Vargas warned the mines ministry of a “critical situation” in Las Bambas. He told Tuesday’s meeting that he had also traveled to the capital Lima to ask the government to intervene in the dispute, without success.

On the day of the attempted eviction, April 27, the government declared a state of emergency in the region, suspending civil rights to assembly and protest.

The government said in a statement following the eviction attempt that it had supported dialogue between the parties from the start.

Under Peruvian civil law, landlords can attempt to evict trespassers by force for the first 15 days after they move into the property. If that time has elapsed, they have to go through a longer legal process.

Following the clashes, Vargas wrote to Las Bambas management saying that further attempts to restart mining operations would be seen as a “provocation” by his community and could trigger more violence, according to a separate letter dated 29 April seen by Reuters.

“Las Bambas will not restart, not a single gram of copper will come out of here,” he said at Tuesday’s meeting.

The community of Huancuire, which also sold land in Las Bambas a decade ago for $33 million that is now essential to the expansion project, is demanding more benefits from minerals underground.

Pablo O’Brien, a former adviser to several Peruvian governments, including Castillo’s, said communities are pushing their luck by making new demands given previous large payouts.

“This situation is really just open extortion,” he said. “They can’t complain that they haven’t benefited financially.”

Community leaders denied the protests were a shakedown.

“As an indigenous community, we need to be heard because the government issued this permit without consulting us,” said Romualdo Ochoa, president of Huancuire.

According to Peruvian law, citizens do not own underground mineral wealth and the land has already been officially sold, Ochoa acknowledged. But he said indigenous communities have special rights because of their long ancestry in the territory: “What’s under our soil is still ours.”

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Reporting by Marcelo Rochabrun; Additional reporting by Marco Aquino; Editing by Adam Jourdan and Daniel Flynn

Our standards: The Thomson Reuters Trust Principles.

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