Zeev's Turnips Patch-No Politics (ZEEV)

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*** Gold related post (NEM) ***


Newmont restarts at Peruvian gold mine

Fri Sep 17, 2004 08:17 PM ET

NEW YORK, Sept 17 (Reuters) - Newmont Mining Corp. (NEM.N: Quote, Profile, Research) said on Friday it resumed operations at a Peruvian gold mine after reaching an agreement that ended a blockade by local farmers who allege mining is polluting local water.

The Denver-based miner said the agreement lifted the blockade of its Minera Yanacocha mine near Cajamarca in northern, Peru, where operations were scaled back earlier this week.

Representatives from the mine, community and Peruvian government agreed to set aside the drilling of a gold deposit until further studies can assess any impact on Cajamarca's water supply.

"We are pleased that negotiations led to a peaceful resolution of this matter," said Carlos Santa Cruz, Vice President of South American Operations of Newmont. "We understand the importance of safeguarding the water supply in the Cajamarca region."

The temporary scaling back of mining operations this week will not affect the estimated full-year 2004 gold production and sales of approximately three million ounces from Yanacocha.

Newmont holds 51.35 percent of the mine, Compania de Minas Buenaventura (BUEv.LM.: Quote, Profile, Research) (BVN.N: Quote, Profile, Research) holds 43.65 percent and the Internacional Finance Corporation holds 5 percent of Minera Yanacocha.

Thousands of farmers held a one-day strike on Wednesday to call for an end to a gold exploration project they say is polluting their water, intensifying local resistance.

Farmers across Cajamarca province joined residents already on strike in the town of Cajamarca, 535 miles (850 km) northeast of Lima, who say gold exploration by Latin America's largest gold mine at the rich Cerro Quilish deposit is contaminating and drying up water needed for dairy farming.

Yanacocha says a regional drought is to blame for a shortfall in water, not mining.

Since Sept. 2, a group of people have blocked the road to the mine to protest exploration drilling, which Newmont said is conducted in accordance with the relevant permit. On Sept. 7, Minera Yanacocha agreed to suspend exploratory drilling in an effort to calm the situation and restore order.

Quilish, one of a cluster of deposits that are all part of Yanacocha's 600-square-mile (1,500-sq-km) site, has proven and provable reserves of 3.7 million ounces of gold, and Yanacocha hopes production can begin as early as 2007.

Demonstrations by farmers have delayed the Quilish gold search since 2002, but exploration restarted in August after the government granted Yanacocha a new permit.

http://yahoo.reuters.com/financeQuoteCompanyNewsArticle.jhtml?duid=mtfh31577_2004-09-18_00-17-03_n17...