Asarco offers environmental proposal on US plants
Date: 02-Sep-02
Country: USA
The financially strapped company said that it could not comment on the details of the proposal for remediation at closed plants and other sites, submitted last week, as it was awaiting talks with the government.
"We feel like it represents a strong proposal and something we're hopeful the Justice Department will give serious consideration to," Asarco spokesman Clay Allen told Reuters.
The company said that the proposal was also a response to the government's legal objection this month to the struggling 103-year-old miner's plan to sell its shares in Southern Peru Copper Corp. to intermediate parent Americas Mining Group to reduce its own massive debt load.
"Through this transaction, Asarco aims to become strong and economically viable by reducing $550 million of short-term debt, leaving only $350 million of long-term debt, with the next maturity of $100 million due in the year 2013," Asarco said in the announcement on its proposal.
Asarco stated that the plan aimed to improve its financial condition and preserve the company as a major producer and consumer of U.S. copper. It added that the proposal also "provides certainty" the remediation work will get done.
A Department of Justice spokeswoman said she could not comment on settlement proposals received during litigation.
"A case has been filed and the only agreement that we have reached is that Asarco has stipulated not to transfer its most valuable asset until the motion for a preliminary injunction is resolved by the United States District Court or a different termination date regarding that stipulation is established," she added.
Asarco has agreed to hold off selling its 54 percent stake in Southern Peru until at least Sept 30. The government, in its role as Asarco's creditor, objected to the sale because it claimed the sale amount was "significantly below" the stock's fair market value and not in the best interests of Asarco or its creditors.
The Justice Department claims that Asarco owes the United States hundreds of millions of dollars for liabilities in at least 18 states, including Washington and Texas, but Asarco has said it is unable to meet its cleanup obligations.
The Phoenix-based company, owned by Grupo Mexico since 1999, has been hurt by slumping metal prices and lower sales. It has close to $1 billion in debt and is negotiating a restructuring of a revolving line of credit that comes due in November.
