Peru Miners, Humala to Discuss Windfall Tax ‘In Coming Days’

Peru’s President-Elect Ollanta Humala will meet with mining companies “in coming days” to discuss a windfall tax, said Pedro Martinez, president of the National Society of Mining, Petroleum & Energy.

Representatives from the industry group will meet with Humala’s advisers to reach a “technical” solution that won’t make Peru less competitive than nations like Chile and Canada, Martinez said. Humala, who pledged to raise taxes after copper and gold rose to records this year, will take office July 28.

“We must be very careful with tax policy as the key for investors is confidence,” Martinez told reporters today in Lima. “If we don’t send clear signals to investors that this growth model will continue, we’ll be shooting ourselves in the foot.”

Investment has slowed over the past three months in Peru, the world’s third-largest copper and zinc producer, amid concern over Humala’s proposals, Martinez said. As much as $42 billion in planned mining investment may be derailed if Humala changes investment rules, Southern Copper Corp. (SCCO) Chief Executive Officer Oscar Gonzalez Rocha said June 14.

Mining Revenue

Peru’s mining export revenue jumped 27 percent to $21 billion last year as copper tripled from 2008 and gold jumped 76 percent. Copper futures for September delivery rose 10.7 cents, or 2.5 percent, to $4.442 a pound on the Comex in New York. Gold for August delivery gained $1.40, or 0.1 percent, to $1,530.60 an ounce.

The government’s cancellation last month of Bear Creek Mining Corp. (BCM)’s silver concession sent “a bad signal” to investors, Martinez said. Peru withdrew permits for Vancouver- based Bear Creek’s $30 million Santa Ana project after protests in the southern highland region of Puno left six people dead, 30 injured and caused $2 million of damage at the region’s airport and government offices.

The company may take legal action against Peru, Chief Executive Officer Andrew Swarthout said in a June 27 interview.

To contact the reporter on this story: Alex Emery in Lima at

To contact the editor responsible for this story: Dale Crofts in Buenos Aires at

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