LATIN AMERICA — Phelps Dodge bids adis to Peruvian play

Phoenix, Ariz.-based Phelps Dodge (PD-N) has pulled out of the Cerro Lindo copper-zinc project in Peru.

The company gave no reason for its withdrawal.

.Situated near the southern department of Arequipa, Cerro Lindo contains an estimated 75 million tonnes grading 1% copper and 2.4% zinc. Phelps Dodge and its would-be partner, Milpo, had planned to develop the property at an estimated capital cost of US$200 million.

Reuters news agency reported that a production decision had been delayed because the Peruvian government was slow to pass legislation which would have eased financing.

The company has also pulled the plug on the McDonald gold project in Montana, selling its 72% interest to its minority partner, Canyon Resources (CAU-X).

Phelps Dodge intends to concentrate on developing the Ajo and Safford projects, both of which are in Arizona, and on expanding the Candelaria copper mine in northern Chile.