MercoPress. South Atlantic News Agency

Deadly conflict challenges Peruvian president Humala fragile mining policy

Humala political base is in poor rural and mining areas

Peru declared a state of emergency in an area of the northern Andes after three people died in clashes between police and opponents of Newmont Mining Corp. 4.8 billion dollars Minas Conga project.

The government imposed the measure for 30 days to restore order in three provinces of the Cajamarca region where Newmont plans to build the copper and gold mine, the Cabinet Chief’s office said in an e-mailed statement.

The declaration comes a week after Newmont was cleared to resume work that was halted in November when its installations in the area were destroyed during six days of protests. President Ollanta Humala allowed the restart by the largest US gold producer after it pledged to build reservoirs to ensure water supplies for communities in the region before resuming work on the mine.

The clashes are a result of Humala’s government refusing to negotiate with those opposed to the project, regional president Gregorio Santos told Lima-based Radio Programas. Newmont is committed to talks and to the region, according to an e-mail from the company’s local unit late Tuesday.

Police fired tear gas and rubber bullets at demonstrators after as many as 2.000 people planned to storm municipal offices in Celendin, close to where the mine will be built, Radio Programas reported. The protesters set fire to vehicles and attacked other government buildings in the town, the Interior Ministry said. The violence also left 25 people injured including two police officers who were shot in the leg, the ministry said.

Celendin’s mayor Mauro Arteaga voiced support for Minas Conga following a June 28 meeting in Lima between Humala and 65 mayors from the Cajamarca region.

The unrest will damage Humala’s popularity among his rural support base and may lead more lawmakers to defect from his party, following the departure of four Congressmen last month after clashes in Cuzco near Xstrata Plc Tintaya copper mine, said Diego Moya-Ocampos, a London-based analyst at IHS Global Insight.

“Humala’s stance is a clear sign that he is committed to continue supporting extractive industries as part of his plan to generate growth based on a social inclusion model, whatever the political cost,” Moya-Ocampos said in an e-mailed statement.

The state of emergency suspends the freedom of movement and assembly, allows police to make arrests without a warrant while authorizing the armed forces to aid the police maintains order. Humala has used the measure three times since taking office last July to quell escalating unrest threatening more than 50 billion dollars of planned mining investment in the next decade.

Newmont, which has invested 800 million dollars in Conga to date, will spend 95 million on the construction of four reservoirs, according to Conga Project Manager Luis Arguelles said June 25.