May 19, 2013
Vale requests extension for potash mine
The Brazilian mining company Vale, which unexpectedly suspended its potash Río Colorado project in southern Mendoza two weeks ago, yesterday requested an extension to the deadline placed by the provincial government for the presentation of a work plan until the end of the month.
The development was revealed by Pérez, who said Vale had grounded the request on an unexpected “upsurge in construction figures, particularly in the railway area.”
The governor met with the firm’s representatives and national government officials in Buenos Aires yesterday, and suggested the meeting had positive results.
“I want to communicate that the project will carry on,” Pérez asserted, adding: “We accepted (the extension request) if they guaranteed that wages of direct employees of Vale will be paid,” along with those of “contractors” and “subcontractors.”
The governor assured that the province will “continue with negotiations so that Vale presents its investment project for this year” in “the meantime.”
“(The firm) requested a deferral of tax to be able to proceed with operations, but it was told that it is impossible,” as “the President also said this would unbalance the state, implying a significant loss of money,” he noted, although also suggesting there are “several alternatives” to balance costs, such as “improving existing railways and building 250 kilometres more,” rather than “laying down 900 kilometres of new tracks.”
The meeting was attended by Federal Planning Minister Julio De Vido and Vale CEO Murillo Ferreira among others
The original deadline set by Mendoza Governor Francisco Pérez’s administration for Vale to conform with such a request expired yesterday, with the company having halted operations on the site back in December.
Disgruntled workers, union leaders and government officials had been demanding “official” information from the company, amid rumours that the majority of the site’s workforce would be axed if the project was to continue at all.
— Herald with DyN