UPDATE 2-Peru government, Southern Copper at odds over Tia Maria mine

Fri Mar 27, 2015 2:39pm EDT
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* Conflicting reports over fate of copper project

* Southern Copper spokesman says project is being canceled

* Energy minister says company will 'rectify' announcement

* Shares down 5 pct (Recasts first paragraph, adds government and company comments)

By Marco Aquino

LIMA, March 27 (Reuters) - Conflicting reports about Southern Copper Corp's decision to cancel development of its $1.4 billion Tia Maria copper mine in Peru's Arequipa region have battered the company's share price and left investors wondering about the project's future.

Southern Copper's head of institutional relations, Julio Morriberon, told local radio RPP on Friday that the company was "canceling Tia Maria and withdrawing all its investments in Arequipa" due to lack of support from regional authorities and continued opposition to the project.

Southern Copper's Nasdaq-listed ADRs fell 5.6 percent on Friday afternoon. Shares in Grupo Mexico, which controls the copper firm, were down 2 percent at 1805 GMT, having earlier fallen nearly 4 percent.

Peru's Mining and Energy Minister Rosa Maria Ortiz said news of the cancelation came as a surprise. After she spoke with Southern Copper President Oscar Gonzalez, the minister said she expects the company to reverse its decision.   Continued...