Doe Run Peru President Says Negotiations Progressing on Pama Extension

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Company to Reinvest Earnings on Health, Environmental Issues in La Oroya

— Negotiations with the Peruvian government are progressing and Doe Run Peru is confident an agreement can be reached that will allow the company to better address health and environmental priorities at its La Oroya smelter, officials said.

In remarks made to the Peruvian Congressional Energy & Mines and Environment & Ecology commissions, Doe Run Peru President Bruce Neil said the company remains firm in its commitment to work with the community and the government to continue to improve conditions for the people of La Oroya.

Doe Run Peru announced in February that it would seek revisions to its environmental operating agreement in Peru, known by its Spanish acronym PAMA. The proposed plan dedicates additional resources to help mitigate lead contamination that is affecting children’s blood lead levels in La Oroya, while also addressing the plant modernization and other improvements required under the existing plan.

“We understand the concerns of the authorities and of the people who want a guarantee that we will keep to our commitments,” Neil said on Monday. “That is why we propose that during these five years of extension the majority of our free cash flow will be reinvested in the PAMA projects.”

Free cash flow is an accounting term that refers to the amount of cash that a company has left over after it has paid all of its expenses, including investments.

Neil explained to the congressmen that of the 9 projects included under the current PAMA, Doe Run Peru is completing 8 within expected timeframes and budgets. The company only needs additional time to complete one of them: the construction of a sulfuric acid plant that represents a $100 million investment.

Since purchasing the 75-year-old metallurgical complex from the Peruvian government in 1997, Doe Run Peru has invested $140 million in technology and facility improvements. Those efforts have reduced blood lead levels in the workforce by 27 percent and reduced air lead emissions by 21 percent.

In addition, the company has rebuilt arsenic and slag disposal systems and landfills, and significantly reduced discharges into local rivers, eliminating discharges into one river and reducing effluents into another by half. The company remains committed to the complete elimination of such discharges by the end of 2006.

The new proposal includes additional projects to control “fugitive” emissions from open complex buildings during the next two years, further and significantly reducing levels of air lead, the principal contamination problem in La Oroya.

Doe Run Peru’s efforts to address the health and contamination issues and improve living standards in La Oroya have generated broad community support, including more than 12,000 signatures by community members on petitions backing the company’s extension request and demonstrations in support of Doe Run organized by La Oroya Mayor Clemente Quincho and leaders of the labor union representing the company’s 3,100 unionized La Oroya employees.

Neil also noted that Doe Run Peru’s contracts with its financial institutions require it to have a PAMA agreement to continue operations.

Neil stressed that the company wants to remain in Peru. “We are committed to working with the authorities and the community to resolve the health issues and the environmental concerns that exist at the La Oroya metallurgical complex,” Neil said. “La Oroya is a good place for a long-term investor. Doe Run wants to continue to be an important part of Peru and of the Peruvian economy,” Neil concluded.

The Doe Run Company, along with its subsidiaries, is a privately held natural resource company focused on environmentally sound mineral production, recycling and metals fabrication. Based in St. Louis, the company and its subsidiaries serve as North America’s largest integrated lead producer and third-largest total lead producer worldwide, employing more than 4,000 people. The company and its employees are committed to keeping its operations and communities clean and safe while producing essential raw materials – lead, zinc, copper, gold and silver – that are needed for everyday life. Doe Run and its subsidiaries have U.S. operations in Missouri, Washington and Arizona, and South American operations in Peru. Find Doe Run on the Web at


Barb Shepard



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