Peru Minister: Doe Run Peru Can't Reopen Plant Without Upgrade

LIMA, Aug 04, 2010 (Dow Jones Commodities News via Comtex) -- Peruvian Minister for Mining and Energy Pedro Sanchez said that Doe Run Peru won't be able to resume running La Oroya metallurgical plant without finishing an environmental upgrade.

The government has taken a hard line against the company in recent weeks, saying that the company hasn't taken promised steps to reopen the La Oroya plant.

"Independently of any statements made by the company, it is clear that Doe Run isn't going to start to contaminate La Oroya again as it has done in the past," Sanchez told reporters Wednesday.

The government has started the legal and regulatory process of removing Doe Run Peru's ownership of the plant.

The government says that Doe Run Peru, a unit of U.S.-based Renco Group Inc., has failed to complete an environmental upgrade to its sulfuric acid plant, among other things.

The company said this week that it has hired various experts to carry out technical and financial studies in order to reprogram the restart of operations and conclude the environmental upgrade.

Environmentalists have described La Oroya, about 200 kilometers east of Peruvian capital Lima, as one of the most polluted places on Earth.

Doe Run shuttered the polymetallic smelter, which normally produces copper, lead and zinc, more than a year ago, after a cutoff in bank loans prevented it from paying for metal concentrates.