Environment Minister Manuel Pulgar-Vidal said during a news conference that the review will clear up concerns about potential environmental pollution in Espinar.

"The objective is to identify exactly what is the environmental- and public-health situation in Espinar," Mr. Pulgar-Vidal said.

A number of mining projects in Peru, a major producer of base and precious metals, have been targeted by protesters recently over environmental concerns.

In late May, residents clashed with police during protests against Anglo-Swiss company Xstrata PLC's Tintaya copper mine. The government declared a state of emergency in the province after two people were killed and dozens were injured.

Protesters had taken to the streets over demands for Xstrata to increase contributions to a fund for local sustainable-development projects and citing worries that the mine was contaminating the area.

Government and company officials had denied that the mine has caused pollution.

On Friday, Prime Minister Oscar Valdes said he hopes the environmental study in Espinar will reassure residents.

"We want the population of Espinar to know that the central government is ready to defend the environment," Valdes was quoted as saying by Dow Jones Newswires.

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