Peru suspends controversial gold mining project

A controversial $4.8 billion gold and copper mining project in northern Peru has been suspended until US mining company Newmont can guarantee the preservation of local water supplies, the government said Thursday. "We have entered a different scenario, the project has entered a new phase of suspension that the company has already decided on, and the government of course asked for," Peru's Prime Minister Juan Jimenez said. The government said it would give Newmont two years to come up with a way to guarantee water supplies for inhabitants of the Cajamarca region where the Conga mine is located. Plans for the mine would have required sacrificing four high-altitude lake reservoirs and replacing them with artificial lakes, raising concerns about the impact on long-term water supplies in a region seared by frequent droughts. Strikes and protests against the project have swept the region since the end of 2011, prompting the government on several occasions to declare states of emergency and forcing Newmont to suspend the project November 30, 2011. The project was reactivated in April after an environmental study ordered by the government gave it a green light. Newmont's president Richard O'Brien recently recognized the environmental issues surrounding the project, and in an interview with Dow Jones Newswire promised to make significant changes. Conga, which initially was to have begun operations in 2014, had been approved by the government of former president Alan Garcia in 2010. His successor, President Ollanta Humala also supported it while insisting on environmental protections.