Creditors seek to reopen La Oroya smelter
Creditors of Peru's La Oroya zinc-lead smelter will attempt to reopen the metallurgical complex after a 16 month shutdown, the country's energy and mines ministry (MEM) said.
Creditors including Glencore, Trafigura Beheer, Pan American Silver, Buenaventura, El Brocal and Volcan chose local consultancy firm Dirige to manage the ongoing bankruptcy process of the former Doe Run Perú unit, the ministry said in a statement.
Dirige, the third firm to run the smelter and its copper mine Cobriza in the past year, will now seek a buyer for both assets, ministry official Rosario Patiño said in the statement.
"Dialogue solves everything," said Patiño, who heads the board of creditors. "Creditors, workers and companies achieved a consensus towards a common goal: the restart of the complex for everyone's benefit."
The smelter's creditors originally planned to start liquidating the assets at the end of August after failing to draw bidders for the smelter and Cobriza. Peru's President Ollanta Humala urged creditors to grant the sale process more time after workers' protests that month left one dead and 70 injured.
The ministry did not provide a start-up date for the smelter, which re-launched zinc and lead operations in 2012 after a three year shutdown but closed again in July 2014. The smelter owes about US$600mn to a group of 100 creditors including the workers' union and the government.
La Oroya can produce 122,000t/y of lead and 43,000t/y zinc, according to the ministry. Cobriza produced 21,159t copper in 2014.
Built in 1922 by the Cerro de Pasco Corporation, and acquired in 1997 in a privatization process by Doe Run, La Oroya halted operations in 2009 after metals prices collapsed. La Oroya has the capacity to produce a dozen different metals including copper and silver, but failure to meet environmental standards shuttered the copper circuit.
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