Barrick Gold moves ahead in talks about Lagunas Norte Mine

February 26, 2013

Barrick Gold Copr. announced that it had reached agreement in several areas with opponents of its Lagunas Norte Copper Mine in northern Peru, but also said there are still some unresolved issues regarding pay for local contract laborers.

About 200 people blocked access to the mine last week over various demands, including more jobs for local residents, better working conditions for contractors and development projects in their community. Protesters are also concerned about the impact of mining on nearby lakes.

A spokesman from Barrick's office in Lima said that production has not been affected.

Lagunas Norte is one of Peru's biggest gold mines. It produced 210,000 ounces of gold in the fourth quarter and is expected to produce 560,000 ounces to 600,000 ounces of gold this year.

Several mining projects in Peru have recently been the target of protests by Andean residents, often over environmental issues, Fox Business News reported.

Last year, Barrick temporarily halted operations at its Pierina mine in Peru after one person was killed in a clash between nearby residents and police. The residents had set up blockades to that mine to pressure the company for investments in local water projects.

Peru is the world's sixth biggest producer of gold. It is also a major producer of copper, silver and zinc, among other minerals.

Scotiabank Peru said in a report that it expects Peru's gold production to fall about 6% in 2013. The forecast is due to expectations that output will decline at Barrick and the other major gold producer in Peru, Minera Yanacocha.

Output from Barrick's Peruvian operations is expected to drop close to 20% this year as ore grades decline at Lagunas Norte, Scotiabank said.