Peru cancels mine after 6 killed in clash

[June 25, 2011]  LIMA, Peru (AP) -- Peru's government canceled a Canadian-owned silver mine in the southern highlands Friday after six people were killed and at least 30 wounded when police fired on mostly indigenous protesters opposing the project.

Protesters also attacked a police station and a state bank in a second city.

The bloodshed occurred when police turned back protesters who tried to take over an airport near the city of Juliaca in Puno state, an area they have paralyzed with road blockades since May 9 in a bid to cancel the Santa Ana mine as well as a proposed hydroelectric project on the Inambari river.

The outgoing government of President Alan Garcia announced after leftist military man Ollanta Humala won the presidential election June 5 that it was scrapping the Inambari project. In April, it canceled a huge copper mining project in another southern state after three protesters died in clashes with police.

Mining accounts for two-thirds of Peru's export earnings and has been the underpinning of a decade of robust economic growth, but the rural poor have benefited little from mining and complain it contaminates their water and crops.

Dr. Percy Casaperalta, who directed the evacuation of wounded after Friday's clash at Manco Capac airport, said at least 4,000 protesters were involved. He provided the toll of six dead and at least 30 wounded by telephone from the local hospital Carlos Monge Medrano.

Television images of the airport showed its perimeter walls breached and tires burning on the tarmac.

Speaking with journalists in Lima, Interior Minister Miguel Hidalgo said police in Azangaro, about 40 miles (68 kilometers) from Juliaca, were "in a difficult situation." Local radio reports said about 500 protesters angry over the deaths at the airport burned tires and threw rocks at the local police station and a state bank.

Hours after the violence, Deputy Mining Minister Fernando Gala announced that the government had revoked a 2007 decree granting approval to Bear Creek Mining Corp. of Victoria, British Columbia, to mine silver at Santa Ana in Puno. The decree was required because the mine site is within 50 miles of an international border, in this case with Bolivia.

Bear Creek's director, Andrew Swarthout, told The Associated Press that the company had not received formal notification of the decree's revocation.

He said any government attempt to cancel the project would be illegal and amount to "expropriation."

"We followed all the rules. We got public consent. We're in the middle of an environmental impact statement. It was due process. Everything was within the letter of the law," Swarthout said.

The company has said it already spent $96 million on the Santa Ana project.

Swarthout has warned previously that any attempt to end the project would give pause to international investors who have announced their intention to plow more than $40 billion into Peru's mining sector in the coming decade.

[Associated Press; By FRANKLIN BRICENO]

Associated Press writer Frank Bajak contributed to this report.

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