UPDATE 1-Peru rules out cleanup extension for Doe Run Peru
(Adds comment from Doe Run Peru, paragraphs 8 and 16)
By Teresa Cespedes
LIMA, May 20 (Reuters) - Peru has no plans to grant Doe Run Peru an extension to meet the terms of an environmental cleanup that is scheduled to be completed by October, the vice minister of mining said on Wednesday.
One of the company's suppliers told Reuters earlier this week that Doe Run Peru, the country's No. 4 metals exporter, told the government it will only meet the terms of a financial bailout plan if its deadline on the cleanup is pushed back.
"We have not seen any legislative change that would permit us to foresee an extension of the cleanup," said Juan Felipe Isasi, Peru's mining vice minister.
"There is a rule in force, which mandates that Doe Run complete the cleanup in October," he said, adding the company has sufficient time to do what it is required.
The company's sprawling La Oroya smelter has been mostly stopped since March after banks, worried about falling metals prices, cut its credit line in a sign the global downturn was hitting the backbone of Peru's economy.
In April, a group of mining companies that sell concentrates to Doe Run Peru agreed to give it a $175 million credit line if its parent company, U.S.-based Renco Group, met two conditions.
The stipulations were that Renco had to fill a $156 million financial shortfall in its Peruvian unit and pledge its shares to the Peruvian government as a way of promising that its unit would finish an environmental cleanup project at one of the world's most polluted sites. Continued...
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