Peru has been mired in protests for more than a week after former President Pedro Castillo’s failed attempt to dissolve Congress and replace him with Vice President Dina Boluarte.
The social crisis has amassed more than 27 deaths, prompting the current leader to fire her prime minister, Pedro Angulo.
Protests are taking place across Peru following the impeachment and arrest of former President Pedro Castillo on December 7.
The effects of the conflict were immediately seen in a country that has been going through a political crisis for years. Since 2016, the Andean nation has seen six heads of state pass and has become accustomed to constant unrest.
While 49 congressmen voted in favor of the constitutional reform bill proposing electoral advancement, 33 voted against and 25 abstained, so it did not move forward.
The proposal was for elections to be held in December 2023, thus shortening the term of Boluarte, who would take office to complete the presidential term for which Castillo was elected, which ends in mid-2026.
However, Peruvian authorities announced on Sunday that the unrest had begun to subside. “The measures we have taken are working (…) the roads are being recovered, the airports are being made available and the violence of the people who were demonstrating in the streets is also decreasing,” Angulo told state television station TV Peru yesterday.
“I think we are on the right track, as the president (Dina Boluarte) has already pointed out, the measures that have been taken are helping to reduce the conflict,” Economy Minister Alex Contreras told Radio RPP.
He explained that several ministers have traveled to conflict zones “to promote dialogue and reach consensus”.
IMPACT ON MINING
Although the sector – which represents approximately 10% of the country’s Gross Domestic Product (GDP) and accounts for almost 60% of exports – has not seen its operations on the ground affected, its logistics chain has been hampered.
Blocking roads and threats to seize some facilities by protesters have led to bans and the application of preventive measures by companies.
One of them was Buenaventura, which announced the suspension of operations at two depots after its entrance gates were blocked by those who took to the streets.
Cerro Verde, the world’s largest copper concentrate complex, with about 20% ownership, has also experienced delays in transporting people, supplies and products.
The Las Bambas mine, the third largest in Peru and owned by China’s MMG, has been forced to store semi-finished metal at its site due to blockages in the passage of heavy-duty vehicles.
In addition to the pressure on storage capacity, this could lead to a ban on deposits and thus affect global supply, as it represents about 1.4% of global output.
That country’s National Mining, Petroleum and Energy Corporation said it is 500,000 metric tons of copper, equivalent to US$1 billion.
As of press time, Anglo-American said it was operating normally and BHP had not commented.
THE COMPLICATIONS OF THE ROAD OF CAMISEA
Last Tuesday, December 13, a group of 230 protesters entered the Compressor Plant in Kamani (Kepashiato) of TGP, the company responsible for bringing natural gas from Camisea. After that, the plant was stopped and the volume of natural gas transported throughout the national circuit was reduced.
A few hours later, the Ministry of Energy and Mines (MINEM), through the General Directorate of Hydrocarbons (DGH), published the executive resolution 411-2022 for the suspension of the export of natural gas and, with this, the guarantee of domestic supply and national production of electricity. in La República.
Sources from PERU LNG, the company responsible for exporting liquefied gas from Ica, confirmed to La República that shipments had been suspended since that date, with a single shipment of nearly 3 million cubic feet to South Korea (vessel Sestao Knutsen) on 15. because it had been delayed since before the publication of the regulation.
However, the company warned that the state loses almost $2.5 million in taxes every day the plant closes.
In addition, he noted that deliveries through the TLF (Truck Loading Facility) for northbound and southbound trucks may become more complicated until the situation is resolved.
What does this mean?
Gustavo Navarro, former director of DGH, explains that PERU LNG not only exports gas to the world, but also loads it into tanker trucks to supply the rest of the country (in Lima, it arrives by pipeline).
In the north it is delivered by Quavi, while in the south by Petroperu with commission.
“Besides exports, the intermittent purchase contracts have been discontinued because some companies sign contracts to get gas only when it is available. Then a proportion has been set for electric generators because there is not enough gas for everyone,” he says.
In fact, the resolution has caused TGP’s carrying capacity to be reduced from 1,540 to 1,275 MMPCD. This change corresponds to shipments to Spain and Korea, the main destinations these days.
