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Peru is assigning the military with the task of regaining control of a mineral-rich area of the country’s northern highlands after 13 gold-mine workers were kidnapped and murdered.   

Army troops who were previously supporting police in the province of Pataz will now take control of security, President Dina Boluarte told reporters in Lima on Monday. Mining activity in the area will be suspended for 30 days.

She spoke after 13 bodies were discovered in a mine shaft over the weekend as criminal groups step up a wave of terror over control of the precious metal in the area. The deceased were working as guards at a small mine that is a contractor to Cia. Minera Poderosa SA, one of Peru’s largest gold producers. At least 39 workers have been killed in recent years in Pataz, Lima-based Poderosa said Sunday in a statement.

The  underscores authorities’ struggles to respond to violent gangs tapping into an illegal gold boom at a time of record high prices. Violence has continued in Pataz even after a state of emergency was declared more than a year ago.

While Peru is best known for its massive copper mines, it’s also a significant gold producer. The case is another blow to the already unpopular president and to the country’s reputation as an investment destination. 

SNMPE, the association representing global producers such as BHP Group and Glencore Plc, said the government has yet to even approve a plan to combat illegal mining, which also poses a threat to formal operations.

“The kidnapping and murder of these workers demonstrates that illegal economies seek to intimidate Peruvian society and seize public and private property, such as formal mining concessions and operations,” SNMPE said in a statement late Sunday.

Opposition lawmakers were collecting signatures Monday in a bid to remove Prime Minister Gustavo Adrianzen, who last week expressed doubts about whether the Poderosa contractors had really been kidnapped. It’s unclear if that effort would garner enough support.

Skyrocketing prices 

The formal industry has been critical of a mechanism, called Reinfo, that’s designed to allow artisanal miners to formalize their operations. The temporary registry has merely provided quasi-legal status that has helped to promote informal mining, industry representatives say. 

“Reinfo is used as a shield by illegal miners who now attack not only artisanal, small and medium-sized miners, but also large-scale mining,” SNMPE President Julia Torreblanca said in an interview with a local radio station. 

Some large mines in Peru have battled to have small-scale miners removed from their concession areas while others have opted to buy their ore. 

Late Monday, Poderosa was trying to confirm whether it was included in the mining suspension. “It would be foolish to halt operations of formal mines,” spokesman Pablo de la Flor said in text messages. “That’s precisely what illegal mines want.”

Violence in Pataz has been contained in the past, mitigating risk to the broader industry. Still, greater scrutiny is needed across the entire production chain as skyrocketing gold prices create a further incentive for illegal activities, according to BTG Pactual analyst Cesar Perez-Novoa, who specializes in natural resources.

“Going forward, mining companies will likely bolster investments in armed security measures to counter organized criminal groups, potentially with international ties, that are illicitly extracting minerals for sale in international markets, circumventing established traceability protocols,” Perez-Novoa said.

(By James Attwood and Marcelo Rochabrun)