Peru Mine Disruption to Continue as MMG Fails to Oust Protesters

(Bloomberg) -- MMG Ltd. is facing the possibility of a prolonged disruption at its copper mine in Peru after failing to clear the site of all protesters in an operation that has further inflamed tensions with indigenous groups.

The Hong Kong-listed company's security personnel teamed up with police this week in attempt to expel community members camping in the Bambas mine site to protest alleged non-compliance of land-purchase obligations. In Peru, land owners have 15 days to undertake such evictions without having to take the matter to court, a period that expired Friday. Earlier this week, a state of emergency was declared in the area.

Images of clashes between indigenous groups and security forces -- resulting in injuries to more than a dozen people -- were beamed around Peru just as the industry gathered in Lima for a trade show and conference.

The impasse is the latest blow to President Pedro Castillo's turbulent first year and a setback for mining's efforts to improve relations in remote rural communities. It also means the market will remain starved of copper from a mine that represents 2% of world supply.

The government, which appeared to wash its hands of responsibility for the eviction, issued a statement offering to hold talks with community leaders at a venue of their choosing on May 7.

The mine may also seek to oust protesters with the backing of courts, although that could be a lengthy process. It was unclear if the state of emergency affords any scope to expel protesters.

MMG didn't immediately respond to requests for comment. The company previously said it was fully compliant with its community obligations and was seeking dialog to find a resolution. It called for an end to the illegal occupation.

Security and police forces had failed to evict protesters from one part of the the mine site by Friday's deadline, Alexander Anglas, legal adviser to one of the communities confirmed in a voice message. La Republica reported that one of its journalists was detained by private security personnel dressed as police.

Castillo, who has survived two attempts to oust him from office and has overhauled his cabinet four times, is now grappling with an uptick in social conflicts and generalized unrest over living costs.