Nov. 11 (Bloomberg) -- Pan American Silver Corp.’s third- quarter cash costs rose by $1.35 per ounce after its largest Peruvian customer closed, Chief Financial Officer Robert Doyle said.

Vancouver-based Pan American, which also has operations in Mexico, Argentina and Bolivia, hasn’t sold its Peruvian silver stockpile since Doe Run Peru shut its zinc, lead and silver smelting operations in June, Doyle said today on a conference call with analysts.

“I expect an impact on future results of the company for at least the period the La Oroya smelter remains closed,” Doyle said. “We’re optimistic that the smelter will resume operations in the first half of 2010.”

Pan American, which is unable to collect an $8.8 million debt from Doe Run, has stockpiled 400,000 ounces of silver and 9,600 metric tons of zinc, Doyle said. Banks halted lending to Doe Run, a unit of Renco Group Inc., in February after copper, zinc and lead prices fell at least 49 percent in London last year.

Pan American aims to invest up to $15 million next year in Toronto-based exploration company Aquiline Resources Inc.’s Navidad silver deposit in Argentina if a $610 million takeover bid is accepted by Dec. 7, Pan American Chief Executive Officer Geoffrey Burns said on the call.

Pan American gained for a fifth day, rising 37 cents, or 1.5 percent, to C$25.14 at 12:37 p.m. in Toronto Stock Exchange trading. Third-quarter net income nearly tripled to $17.4 million, or 20 cents a share, the company said yesterday.

To contact the reporter on this story: Alex Emery in Lima at aemery1@bloomberg.net

Last Updated: November 11, 2009 13:37 EST