Arequipa: Cerro Verde mining company only wants to pay $1.61 per m3 of water for its operations

Sedapar and the Cerro Verde mining company They will be forced to enter into dialogue starting in October to negotiate a new agreement on the use of wastewater from Arequipa’s drains. This wastewater used to be discharged without prior treatment into the Chili River during decades. Cerro Verde captures these waters, processes them at the La Enlozada plant and uses them in its operations to process minerals. The mining company received one cubic meter for free in exchange for operating the La Enlozada Wastewater Treatment Plant (WWTP).

In the Sedapar Shareholders Meeting which took place last Monday, with the participation of three of the eight provincial mayors, Sedapar’s proposal was approved to set the price of treated water from La Enlozada in $3.63 per cubic meter (m3). The other alternative is for the mining company to invest 3,112 million dollars. Cerro Verde’s counterproposal is to pay $1.61 dollars per m3.

The basis for establishing this amount is found in the agreement signed in 2015 when Cerro Verde completed construction and put the La Enlozada WWTP into operation. The agreement, called the framework agreement, established that the mining company would be responsible for operating and maintaining the plant until a new legal framework was enacted that would allow the commercialization of treated wastewater or until both parties agreed on the amount to be paid.

This new legal framework was approved in 2017 by supreme decree 019-2017 of the Ministry of Housing. From that moment, Sedapar began evaluating the price it should charge the mining company. To determine this rate, Three technical consultancies were carried out. The first of them established a rate of 9.15 dollars per m3, while Cerro Verde presented its counterproposal prepared by Apoyo Consultoría.

A third study carried out by the engineer Pedro Sandoval Salazar, which addressed the seawater desalination proposal, established a cost of treating and pumping desalinated water at $3.63 per m3. This amount was applied to the case of La Enlozada, considering that, if the WWTP did not exist, The mining company would have to bring water from the Arequipa coast, which makes the treatment plant the optimal option for the water supply of the extractive company.

According to projections of income from water marketing carried out by Sedapar from 2017 to 2043, income would amount to 4,103 million dollars. However, Sedapar must consider previous investments made by the mining company, which would reduce net income to $3,112 million. Sedapar’s proposal is that, as consideration for services, Cerro Verde carries out works corresponding to Sedapar’s project portfolio for that amount.

500 liters are poured from the WWTP into Chili and are not used

He director of the Caplina Ocoña Water Administrative Authority, Ronald Fernández Bravo, He gave a detailed presentation during the meeting regarding Arequipa’s water demand and the water deficit.

In the midst of this, he maintained that as a result of the treatment in La Enlozada, there is an average of 500 liters per second that are being released into the Chili River and are not being used. His approach is that the liquid be granted to farmers or, failing that, be transferred to the province of Islay.

For his part, the manager of Sedapar indicated that they will see the regulations. He also said that among the most urgent works is the construction of 4 dams to ensure the supply of water.