Buenaventura Resumes Operations at Uchucchacua Silver Mine

Buenaventura (NYSE:BVN) announced on Monday (November 6) that it has resumed operations at its silver-zinc–lead Uchucchacua mine in Peru.

The Lima-based miner’s share price rose just over 1 percent on the news. Mine output was disrupted last week after a protest over land use from the local Andean community; it first began on October 31.

The country’s Ministry of Energy and Mines Social Affairs Office agreed to establish a taskforce in cooperation with other public offices to end the conflict and resume negotiations.

In a note to Peru’s market regulator on Monday, Buenaventura said the Andean community of Oyon ended the blockade after the government agreed to a dialogue to address demands for land use compensation.

Peru’s largest publicly traded firm in the precious metals mining business was able to resume mining operations at Uchucchacua on Saturday (November 4). The underground mine is expected to produce between 17 and 18 million ounces of silver by the end of 2017, up from 2016 output of 16.2 million ounces. Uchucchacua has produced over 259 million ounces of silver to date.

The company operates several other mines in the country, including Orcopampa, Mallay, Julcani, Tambomayo, El Brocal, La Zanja and Coimolache; it is developing the San Gabriel project as well.

Buenaventura has also run into community opposition at Minera Yanacocha, which it operates with Newmont Mining (NYSE:NEM) through a joint venture.

In 2011, the companies halted construction at the Conga copper–gold project after violent protests broke out in the region; it was expected to offset declining production at the Yanacocha gold mine.

In an annual SEC filing, Newmont said the project “has been the target of local political and community protests, some of which blocked the road between the Yanacocha mine and Conga project complexes and the City of Cajamarca in Peru and resulted in vandalism and equipment damage. We cannot predict whether similar or more significant incidents will occur in the future.”

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Securities Disclosure: I, Melissa Shaw, hold no direct investment interest in any company mentioned in this article.

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