Peru’s government may close the Doe Run Peru smelter next year if its fails to meet an environmental clean-up deadline, Deputy Mining Minister Felipe Isasi said.
The Renco Group Inc. unit, which shut most of its smelting operations in March after banks cut off financing, is operating at 30 percent capacity, he told reporters today in Lima. The zinc and lead smelter has until October to complete an environmental program, he said.
“Under the legal framework, Doe Run Peru has to meet its environmental obligations by October,” Isasi said. “If it fails to comply, it may be shut down after a six-month audit.”
Banks froze Doe Run’s accounts on Feb. 24 after metals prices collapsed because of the global economic slowdown. Doe Run has failed to meet commitments established by an April $175 million bailout plan, Carlos Galvez, chief financial officer of Cia. de Minas Buenaventura SA, one of Doe Run’s chief creditors, said May 18.
Doe Run, which took over the smelter from the state in 1996, said it has invested $300 million in environmental improvements. Doe Run spokesman Victor Belaunde didn’t return calls and an e-mail seeking comment today.
Zinc and lead have both fallen at least 50 percent since March 2008. Peru is the world’s third-largest zinc producer and No. 4 for lead.
Source: Bloomberg
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