MMG’s Las Bambas mine ups offer to Peruvian community in bid to avoid production shutdown

LIMA, Dec 11 (Reuters) – MMG Ltd’s (1208.HK) Las Bambas copper mine has increased its offer of jobs and investment to a Peruvian province blockading a road used to transport the red metal in a bid to stave off a production shutdown next week, meeting minutes seen by Reuters show.

The dirt road from the Chinese-owned mine to a sea port has been blocked since Nov. 20 by residents of the Chumbivilcas province, who are negotiating contracts for locals to be hired as drivers for the mine.

The parties reached a tentative agreement in October, but talks then stalled over the exact number of jobs and funds that Las Bambas would offer, leading to the road blockade.

In its latest proposal, dated Dec. 10 according to the minutes, Las Bambas is offering to hire Chumbivilcas residents to operate 14 trucks carrying copper and 12 pickup trucks and to invest about 1 million soles ($247,000) a year in projects to benefit 10 communities.

The meeting took place earlier on Saturday between Chumbivilcas leaders and government representatives, who presented the proposal on behalf of Las Bambas. Chumbivilcas will now offer a counter proposal and has called the mine to a meeting on Tuesday to look at the new proposal, the minutes say.

The mining road used by Las Bambas is a flashpoint of tensions, having been blocked for over 400 days since the mine began operations in 2016. Residents from several regions who live along the road, including Chumbivilcas, allege the dust lifted by the trucks pollutes their crops and affects their livelihoods.

Representatives for Chumbivilcas and Las Bambas did not respond to requests for comment.

Las Bambas has warned it will have to suspend production by next week if no deal is reached to unblock the road.

Peru is the world’s No. 2 copper producer and Las Bambas is its fourth largest producer of the red metal.

($1 = 4.0560 soles)

Reporting by Marcelo Rochabrun; editing by Richard Pullin

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