Bolivia: Glencore will get little for mine takeover

Carlos Quiroga

LA PAZ, June 20 (Reuters) - Bolivia will not compensate global commodities giant Glencore for rescinding its contract to mine tin and zinc at Colquiri, which was shaken by violent protests, a government decree signed on Wednesday showed.

Evo Morales' leftist government took over operations at Colquiri to end a weeks-long dispute between employees and independent miners. The decree said officials will only pay Glencore's local subsidiary, Sinchi Wayra, for the machinery and goods stored there, minus any debts the company has.

Morales has nationalized the key natural gas industry as well as the telecommunications and electricity sectors, arguing Bolivia's poor should benefit more from the country's rich natural resources.

"Today we're signing a great decree, for two reasons. We're recouping a company that belonged to the state and now returns to state hands, and we're also democratically resolving the contradiction between two factions of the Bolivian population: cooperative workers and salaried employees," said Vice President Alvaro Garcia.

Garcia signed the decree as acting president while Morales attended a United Nations conference in Brazil.
Bolivian state mining company Comibol will have control over the Colquiri mine, 12 years after it was semi-privatized. The decree permits an independent cooperative that has mined one area of the site to continue working there.

Officials at Sinchi Wayra declined to comment on the move.

Last week, hundreds of police and soldiers were sent to Colquiri following violent clashes between groups of workers at odds over the management of the site, which lies about 200 km (125 miles) south of the administrative capital La Paz.

A similar battle for control of the state-owned Huanuni tin mine six years ago ended in clashes between rival groups of miners that killed 17 people.

Colquiri, which is one of three mines operated by Glencore's Sinchi Wayra subsidiary in Bolivia, produced 2,000 tonnes of tin concentrate last year, according to Comibol data.

Sinchi Wayra exported minerals worth more than $300 million last year.

Morales' government is working on a sweeping reform of mining legislation aimed at giving the state a bigger slice of the sector's profits.