Peru road blockades force MMG to halt Las Bambas copper mine

Chinese miner MMG (HKG: 1208) will have to once again halt operations at its Las Bambas copper mine, one of Peru’s largest, as community protests in the nearby province of Chumbivilcas have affected supply logistics. 

The blockade on public roads along Peru’s major copper transport corridor has impacted the company’s concentrate shipments and sales, the company said on Monday. 

While production at the mine continues, the company expects ongoing disruptions will force it to halt the operation sometime this week. 

MMG said the protests relate to locals demands for more logistics transport contracts, as well as classification of these communities as an area of direct influence. 

The miner said locals had rejected company proposals for social development, adding it was pursuing “active coordination” with the Peruvian government and communities to reach an agreement. 

The announcement follows the company’s announcement last week that it was planning to invest $2 billion in Las Bambas to maintain production around 400,000 tonnes per annum in the medium term.

It also comes less than a month after a bus in the Peruvian Andes transporting contract workers at Las Bambas fell off a cliff, killing 16 people and injuring two. 

Road blockades, frequently followed by shipment suspensions, have been a common issue affecting the massive copper mine since its 2015-16 ramp-up.  

Overall, the mine was disrupted for more than 100 days in 2019, with more than 70 communities along the 450 km. road to the Port of Matarani demanding action from MMG and the national government over emissions from trucks and reduction of their farmlands. 

A three-week-long roadblock protest staged at the end of 2020 prevented MMG from exporting 189,000 tonnes of copper concentrate worth $530 million from the mine. 

Las Bambas is the world’s ninth-largest copper mine, with an output of about 400,000 tonnes of the industrial metal per year, or about 2% of global production. 

Shares in MMG, majority owned by China Minmetals, dropped almost 7.5% on Monday, their worst day in more than a month. 

Mining comprises 60% of exports from Peru, primarily for the Chinese market.