Take physic, pomp

This will not count in the GDP figures, of course

Alex Emery of Bloomie neatly sums up the main story behind the Doe Run closure today without pointing too much finger at the real culprit, Michael B’s pal Ira Rennert. Rennert’s company, Renco, and the Peruvian government came to a hashy sort of agreement weeks ago, but (as predicted by IKN) Renco has simply refused to put in the money the company needs to bring it back to some sort of creditworthiness. Here’s Bloomie:
Doe Run Peru Shut 100% of Zinc Smelter Operations (Update1)

By Alex Emery. June 2 (Bloomberg) — Doe Run Peru has shut all of its smelter operations after it failed to reach an agreement with banks and mining suppliers, a union official said today.

The company, a unit of New York Renco Group Inc., is unable to buy concentrates for its La Oroya zinc and lead smelter and can’t pay its 3,700 workers, Mining Federation General Secretary Luis Castillo said today.

“The smelter is closed,” Castillo said in a telephone interview. “The company and the government don’t want to solve this problem, which will cost workers their jobs.”

Banks froze Doe Run’s accounts on Feb. 24 after metal prices collapsed amid the global recession. Doe Run says it needs more time to settle its debts and invest in an environmental cleanup, which has cost the company $300 million since it took over a smelter in Peru in 1997.

Deputy Mining Minister Felipe Isasi said May 20 that the government has set an Oct. 31 clean-up deadline and may fine the company if it fails to comply.

Zinc and lead have both fallen in London by at least a third since March 2008. Peru is the world’s third-largest zinc producer and fourth-biggest for lead.

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