Barrick-Newmont Goldmine Swallowing Historic Town and Literally Shaking its Residents to Their Foundations.

It is Australia's biggest goldmine, swallowing what is known as the world's richest square mile of dirt.

But the Super Pit, in historic Kalgoorlie-Boulder in Western Australia, is also eating the booming city it is helping sustain, and literally shaking its residents to their foundations.

With gold prices hitting record modern-day highs, its North American owners plan to make the Super Pit even bigger, unlocking billions of dollars' worth of extra gold and extending the mine's life through to 2017.

The expansion would make the mine 4km long, 1.6km wide and 600m deep, enough to fit two Eiffel Towers on top of each other.

The only problem is the pit can be extended only in the one direction to follow the gold-bearing ore - west towards the city and to within 200m of the homes of already disaffected residents, who say they have had to put up with noise, dust and pollution for too long.
Locals say Denver-based Newmont Mining and Toronto-based Barrick Gold - the joint owners of the project, who manage the mine through their company Kalgoorlie Consolidated Gold Mines - have put profits ahead of people's livelihoods.

Originally the brainchild of Alan Bond in the 1980s, the mine currently yields close to 850,000 ounces of gold a year, close to $1 billion worth at current spot prices.

It's become the ultimate story of two immovable forces - city versus mine - at a time when the mining industry is going gangbusters.

While guidelines in Western Australia mean that big open-cut mines must have a buffer zone of at least 1500m, the Super Pit could now encroach within 200m of some homes. In Kalgoorlie-Boulder, the locals have warned authorities that the expansion could mean their death or the death of their family members.

The pit's bunt wall is at the end of the street where truck driver Roy Halliday lives and he says the noise and dust are maddening.
Tom Vulhop claims a mighty blast from the pit wrenched a light fitting from his ceiling last March, while Agnes Miller blames the cracks in her floor on KCGM.
Even retirees at the local church group have turned activist against the Super Pit, claiming daily blasts damaged historic All Hollows Church. "We had to put a metal bar across the width of the sanctuary," said church volunteer Kevin Bartle.

Residents of the Aboriginal community of Ninga Mia, on the outskirts of the town, say they will not shift even though they are slowly being surrounded by the mine's waste dumps and the 24-hour hum of the dump trucks that use them.

KCGM spent $268 million with local businesses last year and is the city's biggest employer.

However, it has a poor track record when it comes to keeping pollutants at a minimum and is the nation's biggest-single emitter of mercury.

Williamstown resident Dianne Mills, whose battles with KCGM go back 10 years, said the company's massive financial contribution to the economy and state coffers made it appear untouchable. "In many ways the community feels like it's being eaten alive by this Super Pit," she said.
KCGM general manager Russell Cole sees it differently. "There are many challenges working in close proximity to a major regional city centre," he said. "KCGM works in a very strict regulatory environment, and we continue to strive to meet our ongoing obligations.

"We are a highly regulated company that works within a strict regulatory environment, it is for others to form an opinion of us," Mr Cole said. "Our record shows the Government does not hesitate to use its regulatory strength to control our industry and this operation."

None of the upset locals spoken to are against the mine. To be anti-mining in Kalgoorlie-Boulder is liable to get you run out of town.

But many affected residents come under a local ruling that means their homes are not zoned residential, so they are not protected by the safety zone of 400m, which is unique to the mine and designed to protect them from flying rock.

The mine expansion has been approved by the West Australian Environmental Protection Agency. The final say rests with state Environment Minister David Templeman.
Locals say the EPA has a poor record of protecting citizens, and the Super Pit expansion is no different. They point out that the EPA approved the shipping of lead through Esperance port on the state's south coast and knocked back proposals to protect underground spiders and rare fauna.
Noise from the mine is also a cause for complaint. KCGM has asked the EPA to vary its noise regulations for the mine, which the EPA has approved with a promise of better enforcement. Locals say they were told in 1995 that the then department of environmental protection would prosecute KCGM if it breached the noise regulations that were introduced two years later.

Current noise limits for KCGM are not to exceed a maximum of 51 decibels in the evening or on Sunday at one location, a level just under what could be heard during normal conversation at a distance of two metres. But KCGM's own monitoring shows otherwise.
"Monitoring indicates noise from the existing KCGM operations exceeds the assigned noise levels in the noise regulations at all five reference locations, during both day and night," the company said in applying to the EPA for a variation to the legislation.

It has certainly not been lost on one Boulder resident, who said: "When I knock off from work in the early morning it's so loud it's unbearable."
The EPA claims KCGM has a defence for non-compliance with the regulations because it complied with ministerial conditions for the mine that pre-date the 1997 regulations. A spokesman said the confusion for residents was a "historical accident".

This week, the mine was hit by a massive pit-wall failure on its southern edge, something KCGM said was expected.

KCGM's mine consultants, Snowden, said in preparing a report on the expansion that it still had some doubts about pit-wall failure, despite concluding that the cutback plans "appear adequate".
Here is the full article.

Joint-venture owners Newmont Mining and Barrick Gold move to increase the size of super-pit tailings dam that spilled cyanide two years ago

The more gold goes up, the further down the Kalgoorlie Super Pit partners want to go.

Joint-venture owners Newmont Mining and Barrick Gold want to increase the heights of two controversial tailings dams, and re-open another, as part of its plans to expand Australia's biggest gold mine, the massive Super Pit operations in the West Australian goldfields capital of Kalgoorlie-Boulder.

Newmont and Barrick, through their joint-venture company KCGM, which manages the mine, have won environmental approval to increase the heights of the Fimiston 1 and Fimiston 2 dams, the same dams that are part of a system that broke down only two years ago and contributed to a spill of cyanide and hypersaline water.

Newmont and Barrick want to increase the size of the Super Pit and extend the life of the mine, which sits on the eastern fringe of Kalgoorlie-Boulder and was originally the brainchild of disgraced businessman Alan Bond. The mine yields upwards of 800,000 ounces of gold a year for its North American owners and the expansion would lengthen the mine's life to 2017 by adding a further five years of production.

Gold prices are currently on a high as the value of the US dollar declines further amid serious concerns about the state of the world's biggest economy.

Gold producers exposed to spot prices nearing $US1000 an ounce are cashing in with expectations that the good times will continue to last for a while yet.

However, any increase in the footprint of the mine would leave its borders within 200m of people's houses in some cases in what is a concern to many residents. The pit's depth would be increased to 600m and the extension, called the Golden Pike Cutback, would cover 46ha.

KCGM was fined $25,000, described as "chicken feed" by the owner of the neighbouring lease, for the spill and promised authorities that it had implemented a "number of improvement measures" to better retain all process material, which it is bound by law to do. KCGM also argued that the seepage was mitigated by rainfall at the time and that it co-operated fully with government investigations at the time.

It was not the first time KCGM had been guilty of spilling waste water, with a similar breach in 1993. KCGM has also been caught out twice breaching sulphur dioxide emission limits and is the nation's biggest emitter of mercury. It released more than eight tonnes into the surrounding environment during the 2004-05 period.

Neither KCGM general manager Russell Cole or community relations manager Danielle van Kampen returned emailed questions about the nature of the proposed lift in the Fimiston dams or the reopening of the Kaltails site.

While KCGM has received approvals, nearby residents have raised their concerns with the Environment Department appeals convener ahead of a decision by West Australian Environment Minister David Templeman on whether the expansion can proceed.

The Kaltails Dam has been criticised by state environmental authorities in the past for its poor construction, site selection and the destruction of a large tract of vegetation.

KCGM has indicated that it would not re-open the Kaltails dam if it was allowed to increase the other Fimiston operations.

Here is the full article.

Barrick's Golden Comeback

After years of watching its stock go nowhere, world's largest gold producer has caught the wave of bullion's rise

Toronto's Barrick Gold Corp. is basking in a bull market for bullion, and no one is more keenly aware of the golden opportunity than chief executive Greg Wilkins.

For at least a decade, shares of the world's largest gold producer pretty much went nowhere as production plateaued and a controversial hedging program of selling production forward – a genius move when gold was tanking through the 1990s – eventually turned off investors as the gold price climbed back up.

And now as the precious metal hovers near $900 (U.S.) an ounce and appears headed for four-digit territory this year, the bullion business is booming. Barrick, which celebrates its 25th anniversary this year, is catching the wave, rising 14.5 per cent since the start of 2008 despite a recent market correction.

Barrick stock closed in Toronto at $47.79 (Canadian) yesterday, down 28 cents. Spot gold in New York rose $1.30 (U.S.) to $880.80.

"It's excitement about the gold business. It's been a long time coming but it's finally here," Wilkins told the Toronto Star in an interview at Barrick's Bay St. offices.

It sure didn't pan out that way overnight.

Wilkins points to a step-by-step approach he has taken since he took over five years ago to turn things around and return Barrick to its former glory as the go-to gold producer in the tradition of flamboyant founder and chair Peter Munk.

It's all happening amid a time of soaring costs to extract the coveted ore from the ground and the scarcity of new deposits that has made it a nightmare to replace lost production for the players in gold's big leagues.


"We needed to deal with the hedging, we needed to get some growth back into the company and to re-establish credibility in the market place. We needed to get bigger in order to compete in a value-added way – not just to be bigger for size – and we needed to get back on a positive trajectory," he explains.

The biggest part of getting bigger involved scooping up old Vancouver rival Placer Dome for $10 billion in 2006. But Barrick has made some smaller acquisitions along the way, including the recent purchase of Arizona Star Resource Corp. that gives it control of one of the world's largest undeveloped gold and copper projects in Chile.

In fact, it is so big now that Barrick's market capitalization of $41.6 billion vaults it beyond that of household names such as Home Depot, Caterpillar and John Deere in the U.S. And it is a giant on the Toronto Stock Exchange, with fewer companies larger except for the big banks, Manulife Financial and Thomson Corp.

"I think it's great. It's just icing on the cake," Wilkins says with a smile.

Long-time gold bug and analyst John Ing of Maison Placements Canada chalks it up to "the marvels of $850 and $900 gold. It wasn't anything sterling or any nifty manoeuvres on their part."

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But one of the big knocks against the senior gold companies is their flatlined production, since gold is so hard to find and expensive to mine these days. Wilkins boasts of Barrick's "unrivalled" pipeline of projects including the opening of Buzwagi in Tanzania next year and Cortez Hills in Nevada in 2010.

But some analysts aren't so sure about other projects down the road, such as the Pascua Lama gold-silver deposit on the border of Chile and Argentina. It was supposed to be in production this year but has instead hit numerous permit and cost roadblocks. The price tag to develop the 17-million-ounce project has ballooned to $2.5 billion.

(More about Pacua Lama timeline here: Barrick Gold Corporation's Pascua Lama Mining Project on Hold - The Perils of Gold Mining in Chile's Border Region - Uncertainty Rattles Shareholders )

"Yes, they have growth, but they also have rising costs and these projects are capital intensive and a way's away," says analyst Barry Allan of Research Capital Corp.

Pascua Lama is "an iffy project that's technically difficult and it's in the multi-billion dollars to build. In the old days, these things would only cost a couple of hundred million. I seriously doubt it will be built in this cycle," Ing notes.


Here is the full article.

Barrick Gold Corporation's Pascua Lama Mining Project on Hold - The Perils of Gold Mining in Chile's Border Region - Uncertainty Rattles Shareholders

SANTIAGO, Jan 17 (Tierramérica) - Nearly two years after winning environmental approval from the Chilean government, the controversial Pascua Lama gold mining project of the transnational Barrick Gold Corporation remains without a launch date.

(See: Chile-Argentina Tax Dispute Delays Barrick Gold Corporation's Pascua Lama Gold Mine Development )

The gold deposit, in the Andes Mountains at 4,200 to 5,200 metres above sea level, holds proven reserves of 17 million ounces of gold and 689 million ounces of silver. The investment needed to mine the precious metals reaches 2.4 billion dollars.

It is the world's first binational mining project, with 80 percent of the deposit lying in the northern Chilean region of Atacama, and the remainder in the north-western Argentine province of San Juan.

One crucial aspect is for the two countries to determine the tax distribution, given that an existing agreement prohibits double taxation.

On its web site, Barrick states that progress continues on the mining project, but that in order to announce the construction of the mine the corporation needs to obtain more permits, especially in Argentina, and that the governments of both countries need to finalise the tax regimen.

In a communiqué released in October, it stated that the time line remains uncertain and that it is beyond the corporation's powers.

The company that manages Barrick's public relations, Extend Communications, declined to respond to Tierramérica's questions about dates and pending authorizations.

(Typical, Barrick Gold's environmental and humanitarian track record is not only abysmal but shocking. See: Al Gore dumps Barrick Gold sponsorship for Chile visit

"You can't be sincerely worried about environmental phenomena affecting the planet and at the same time be 'mates' with a company like Barrick Gold." Senator Navarro.)

On Feb. 15, 2006, the regional environmental commission, COREMA, of Atacama approved, with conditions, the environmental impact study presented by Barrick. In December, the government of San Juan province did the same.

(In the first environmental impact statement Barrick left out all mention of the glaciers. See: Pascua Lama Gold Mine, a Threat to Sustainability )

COREMA rejected Barrick's proposal to remove three glaciers near the gold deposit -- Toro I, Toro II and Esperanza -- whose runoff sustains the Huasco Valley water system and allows some 70,000 small farmers to cultivate their land. The commission also demanded that the corporation provide a monitoring and management plan for the glaciers.

In giving the green light to the project, the governments have sidelined the opposition of local communities and environmental groups from both countries, which have continued to carry out protests, stating that the mining project would have serious environmental and socio-cultural consequences.

Lucio Cuenca, director of the non-governmental Latin American Observatory of Environmental Conflicts (OLCA), told Tierramérica that in February they are planning a bold bi-national meeting in the inhospitable location where the gold reserves are located.

In Argentina, former president Néstor Kirchner (2003-2007) announced during his term that the country would tax the mine's exports as much as 10 percent.

(See: Argentina Mine Tax Threatens Stability, Investment -Industry )

According to press reports, Chile would require Barrick to pay 80 percent of the taxes, in keeping with the proportion of the gold and silver deposits found in Chilean territory. But Buenos Aires has rejected that formula, as all of the output would be processed in Argentina.

The Argentine argument is that any potential environmental damage and the distribution of the mining waste would not follow the 80/20 division. Environmentalists in that country maintain that in addition to affecting water resources, the San Juan side would be left with the waste rubble, which would be permanently contaminated with cyanide from the ore processing.

(See: Toxic Metal Pollution From Medieval Mining Persists 800 Years Later )

Ramón Rada, executive secretary of the Chilean commission that administers the 1997 bi-national Mining Treaty, denied in a Tierramérica interview that the two countries are negotiating tax "rates" and "percentages".

They are only defining "administrative and auditing aspects" more appropriate for the "operational and contractual model that the companies developing the project will utilize."

Rada cited Article 7 of the Mining Treaty, which states that "the income or revenues originating from sales or export of minerals extracted from the territory of one Party... may only be subject to taxation by that Party."

The Argentine Mining Secretariat maintained that remaining are "the adaptation of the protocols included in the Treaty, and very technical questions and specifically regarding taxes" about which a proposal was presented in December and is being evaluated by his counterpart in Chile.

But there are more hurdles. Barrick is involved in a lawsuit with a Chilean engineer who accuses the corporation of tricking him by purchasing the mining concessions for adjacent lands for 20 dollars, instead of the million dollars he says had been agreed.

(See, Washington Post: In Chile, Precious Lands Often Go for a Pittance - Barrick Gold Corporation Pays $19 Dollars for 20,000 Acres )

The mine is to be constructed on land claimed by the indigenous Diaguita community of the Huascoaltinos. In January 2007, the community denounced the Chilean government before the Inter-American Commission on Human Rights for failing to protect indigenous rights.

(Mapuche rights are typically ignored by the government of Chile:

Mapuche lands serve as garbage dump for Chilean Nation - United Nations investigates Environmental Discrimination

Small Mapuche community rests all of its hopes on a group of strangers in far-away Washington, DC - Inter-American Commission on Human Rights (IACHR) )

In addition, OLCA is awaiting the State Defence Council to issue a decision soon on its claim against Barrick for the crime of environmental damages.

The Observatory accuses the mining corporation of destroying to 50 to 70 percent of the glaciers during prospecting and road construction. The damage has been certified by the government's Directorate General for Water.

Senator Guido Girardi, of the co-governing Party for Democracy, is convinced that the project would completely destroy the glaciers.

"Chile must be the only country where projects with negative environmental reports are approved anyway," he told Tierramérica.

(And a Central Intelligence Agency that monitors Environmental NGOs: Chile Intelligence Agency Monitors Environmental NGOs )

OLCA revealed in December that the Chilean authorities approved the installation of 363 high-voltage towers, to carry electricity to the mining site, through the central region of Coquimbo, which the government had already declared a priority environmental area because of its rich native flora and fauna.

(What the Chilean Government appears to be doing often differs from reality: Chile's Government fines itself for polluting the environment )

On the Argentine side of the border, standing in opposition are the Self-Convened Mothers of Jachal, a village near the mining site, wine producers, adventure tourism operators and environmental groups, among others.

The national People's Defender of Argentina, Eduardo Mondino, recommended calling off the project until there is a plan in place to protect the San Guillermo Biosphere, an area that includes the mine site.

Furthermore, the Argentine Supreme Court of Justice is to issue a ruling on a case filed to make effective the environmental protection established under Environmental Law 25.675, which has not been applied because standards have not been established, but which would affect Barrick.

"None of these things alone would necessarily halt the project, but they do generate uncertainty. Each day that Barrick postpones the construction of the mine its public image is at stake, both at the international level and among its shareholders," said OLCA director Cuenca.

The Observatory is concerned about the possible precedent that could be set by Pascua Lama for other projects under the Mining Treaty in high altitudes of the Andes, "where the water is born."

Here is the full article.

Kinross Gold Corporation Vulnerable to Increasing Cost Pressures - Will Partner with Barrick Gold Corporation on the Cerro Casale Project in Chile

TORONTO, Jan 16 (Reuters) - Kinross Gold said on Wednesday that key production increases in Russia and Brazil are on pace to start midway through the year, but warned of increasing cost pressure on earnings and individual projects.

The Toronto-based gold miner said its fourth-quarter results will be pressured by higher prices of oil and other mine consumables, and said cash costs at its Kupol mine in Russia will be higher than the previous estimate of $225 an ounce.

"At today's gold prices, with additional royalties and taxes, it probably gets into the $270 range," Kinross Chief Executive Tye Burt said at a conference in Toronto.

He said Kupol is on pace to start production in June 2008, while the expansion of the Paracatu mine in Brazil should come online at mid-year. Construction at both projects is about 85 percent complete.

The two projects are key to Kinross' plans to boost annual production to around 2.5-2.6 million ounces by 2009, up from an expected 1.6 million ounces in 2007. Average cost per ounce should decline over that period, Burt said.

Kinross also is trying to nail down terms of its partnership with Barrick Gold on the massive Cerro Casale project in Chile.

Barrick acquired a controlling share in the project with its acquisition of Arizona Star Resource, while Kinross owns 49 percent. Kinross said it will provide an update by the end of the quarter. Continued...

Here is the full article.

Al Gore Dumps Barrick Gold Sponsorship for Chile Visit - Mining sponsorship risked "contaminating" and making a mockery of Gore's campaign.

"You can't be sincerely worried about environmental phenomena affecting the planet and at the same time be 'mates' with a company like Barrick Gold." Senator, Alejandro Navarro.

[12th April 2007] Al Gore has dumped financial backing from controversial Canadian mining company Barrick Gold for his upcoming Santiago event "Global Warming and Climate Change: The Time Has Come to Act." The Academy Award-winning environmentalist distanced himself from any association with the mining company, which owns the controversial Pascua Lama gold mine.

"Unfortunately, we were never asked to approve Barrick Gold as a cosponsor and as soon as we became aware that they were co sponsors, we asked that they be removed," Gore's press spokesperson Kalee Kreider told The Santiago Times. "I was informed that they were removed yesterday."

A Barrick Gold spokesperson confirmed to The Santiago Times that they had withdrawn their funding for the event. The US$50,000 that they contributed will be directed towards "other environmental projects." It is still not known how event organizers will cover the cash shortfall presumed to exist now that Barrick has been banned from the event.

Other sponsor's for Gore's visit include the Chilevision television station, the El Mercurio newspaper and the Banco Del Estado.

National political leaders and Chile's environmental community warned earlier this week that the mining sponsorship risked "contaminating" and making a mockery of Gore's campaign.

Barrick Gold has come under fire for dubious environmental and human rights practices on four continents.

(See: Corporate rights trump human rights - alleged that Canadian Barrick Gold security forces intentionally buried alive 52 artisanal miners in Tanzania. )

Its most controversial recent project in South America, the Pascua Lama gold mine, straddles the border between Chile and Argentina in the Andes Mountains in Chile's Region III. The project been harshly criticized by environmentalists worldwide who oppose the company's determination to destroy the glaciers sitting above the metal deposits.

(In its first Environmental Impact Statement Barrick Gold did not mention the glaciers. See: Pascua Lama Gold Mine, a Threat to Sustainability )

"When it comes to the environment, you have to take sides," Sen. Alejandro Navarro told The Santiago Times. "In this case, it means that Gore has to choose whether he wants his message to retain its credibility, or whether he's happy to go along with whomever facilitates the event. You can't be sincerely worried about environmental phenomena affecting the planet and at the same time be 'mates' with a company like Barrick Gold."

Obviously, Gore has chosen.

Glaciers are one of the world's precious fresh water reserves – as Gore pointed out in his documentary film, "An Inconvenient Truth," – and are one of the ecosystems most at risk from climate change.

With 1,751 glaciers within its borders, Chile is home to 3 percent of the world's small glaciers. Global warming, however, is taking its toll. Chile's melting glaciers contribute to over 8 percent of the world's rising sea levels. In the last two years Chile's Marinelli glacier appears to have shrunk by more than four kilometers, despite the area receiving substantial rain.

Barrick's quest for gold in Chile may prove similarly devastating. The company initially drafted a plan to build an open-pit mine and to remove or "relocate" three glaciers impeding Pascua Lama's development. The company eventually received the environmental go-ahead from Chile's National Environment Commission (Conama) in early 2006, but on the condition that the ice mass not be touched. A tunnelled mine, rather than an open pit mine, would have to be used, said Chile's Conama.

Environmental watchdog, the Latin American Observatory of Environmental Conflicts (OLCA) has already reported partial destruction of three glaciers: Toro 1, Toro 2 and Esperanza, which all sit astride Barrick Gold's Pascua Lama mine.

Still, Chile's lax environmental controls and dismally poor environmental track record suggest Barrick will be allowed to continue developing the mine without any significant penalty or oversight.

(See: Chile's Government fines itself for polluting the environment , Revisiting the Valdivia CELCO industrial spill of 2005 , Chile Intelligence Agency Monitors Environmental NGOs )

Residents in the Huasco Valley below the Pascua Lama mine site – many of whom are from the Diaguita Huasco Altina indigenous community - fear residue from the mining process will contaminate the Estrecho River which flows out of the valley. The community also claims it has lost 50,000 hectares of land which Barrick Gold acquired illegally.

(See, Washington Post: In Chile, Precious Lands Often Go for a Pittance - Barrick Gold Corporation Pays $19 Dollars for 20,000 Acres )

"It does not make sense that one of the principal leaders of world public opinion on the threat global warming presents to our planet would come to Chile financed by the same mining company responsible for the destruction of glaciers and water contamination in so many parts of the world," read a statement from OLCA. The organization referred to the sponsorship as an "image-laundering operation" on the part of Barrick Gold.

Here is the full article.

Possible Tax Evasion? Under-declaration of profits by mining companies costs Tanzania US$207 million

Tanzania may be losing millions of dollars because mining companies reportedly cheat the government on declaration of profits in order to pay reduced taxes.

General weaknesses in mining tax management and possibly deliberate under-declaration of profits by mining companies in their bid to pay reduced or no taxes has cost the country US$207 million in 2007.

Commissioner General of the Tanzania Revenue Authority (TRA), Harry Kitilya, told the Nairobi-based newspaper The Nation that there were major weaknesses in mining tax management and that his organization lacked capacity in handling mining tax management.

Kitilya's comments comes hard on the heels of findings by an audit company, Alex Stewart Assayers, which revealed that deliberate under-declaration of profits by mining companies was eating away revenue in the mining sector. Major mining companies operating in Tanzania include Barrick Gold and AngloGold-Ashanti.

In a bid to rectify the anomaly, TRA has, through the International Monetary Fund (IMF), engaged the Canadian Revenue Authority to train their Tanzanian counterparts in mining tax management and increase TRA's capacity in handling tax issues. Kitilya said the training was vital because officials at the Tanzania Revenue Authority were competent in finance and audit, but lacked mining taxation expertise.

However, tax experts told The Nation that Tanzania's mining laws in general have major flaws. The Executive Director of Lawyers Environment Association of Tanzania, Tundu Lissu, said the problem was not in the mining tax management, but with the whole tax regime, which is overly complex and needed to be simplified.

The audit report was clear on how some mining companies were deliberately inflating their losses, a development, which he said, calls for massive overhaul of the policy and legal framework of the mining sector, in order to empower government, local authorities and villagers to have equitable access to the accrued revenue.

"The problem is with the government, which has given too many tax exemptions to mining companies, thus making it difficult to manage taxes from the sector effectively," Lissu said.

A 2005 Parliamentary Public Accounts report indicates that mining companies in that year had declared losses of up to US$1.045 billion, which reveals that the government does not have the capacity to ensure mining companies do not cheat the government.

Tanzania, currently Africa's third largest producer of gold, is touted as having a conducive mining environment that has seen miners pumping into the country US$2 billion in the past decade, according to the Tanzania Chamber of Minerals and Energy (TCME). However, the companies have only paid a total of US$255, 526,893 in taxes over the past 10 years. (25 million per year!)

Tanzanian President Jakaya Kikwete in November, 2007 named an 11-member committee to review all mining contracts the country signed with foreign investors, after accusations from individuals and civil organizations that most mining contracts are tailor-made to suit the investors rather than the locals, who are the owners of the mineral resource.

Here is the full article.

Undervalued Kinross could be a target - Will Barrick Gold Corporation be Geocom's new gold mining partner in the Futaleufu River Valley?

Kinross Gold Corp.'s more than 7% rise on Toronto and New York markets so far Tuesday is no doubt being viewed as a step in the right direction by RBC Capital's Stephen D. Walker, after the analyst said earlier in the day that Kinross' low current valuation makes it a sitting duck.

He told clients in a note that any one of Barrick Gold Corp., Newmont Mining Corp., or Goldcorp Inc. could pull the trigger on a takeover bid for Kinross, citing first and foremost the company's significant 25 to 35% valuation discount on its 2009 cash flow estimates.

Mr. Walker also noted the company's estimated 76% production growth over the next two years and the development upside at Cerro Casale, a joint venture project with Barrick, as further rationale for an offer to emerge.

"With production growing from an estimated 1.6 million ounces in 2007 to 2.8 million ounces in 2009, Kinross is in an enviable position among the Tier 1 producers (along with Goldcorp), with strong forecast growth in production, earnings and cash flow," the analyst wrote in a note to clients.

Here is the full article.

Chile-Argentina Tax Dispute Delays Barrick Gold Corporation's Pascua Lama Gold Mine Development

[January 7, 2008] Construction of the 2.4 billion US dollars Pascua Lama gold mine has been delayed at least one year due to a tax dispute between Chile and Argentina. The Pascua Lama mine straddles the Chile-Argentine border. The Canadian mining company Barrick Gold Corporation announced in September 2007 that it wanted the mine to be up and running by 2011.

However despite investing 200 million US dollars in preliminary construction, the company has not yet been able to start the project because Chile and Argentina cannot agree on how to divide the mine’s tax revenues. About 80% of the mine’s estimated gold deposits are found beneath 243 hectares located in Chile, while the other 20% of gold deposits are beneath 100 more hectares located on the Argentine side of the border.

Chile’s Internal Tax Service (SII) said it would be very difficult for authorities to monitor which side of the border the minerals came from. But regional and local governments in both Chile and Argentina are calling for an exact accounting in order to claim their own share of the tax income.

Environmental worries, especially about the three nearby ice fields -- Toro I, Toro II and Esperanza -- as well as the concerns of the Huasco community that inhabits the valley, have also delayed construction.

Here is the full article.

Moving Mountains for Jewelry - The Environmental Cost of Chile's Gold Mines

ANI or DINA? Environmental organizations protest espionage and infiltration by Chilean Intelligence Agency

ENVIROS DETECT HYPOCRISY IN CONAMA’S SUPPORT OF ANI INVESTIGATION

(Dec. 13, 2007) Leaders of the Chilean environmental movement spoke out Wednesday against the National Environmental Commission’s (CONAMA) support of the government’s monitoring of environmental NGO campaigns. This comes after the Chilean daily La Tercera disclosed last Friday that Chile’s National Intelligence Agency (ANI) has increased oversight of environmental campaigns against three of the country’s most controversial environmental undertakings – the Aysén dam, the Pascua Lama gold mine, and Celulosa Arauco’s (CELCO) proposed waste duct into the sea.

(MICHELE BACHELET & PETER MUNK: Until we hear otherwise, we can infer that Michele Bachelet holds the same opinion of Environmental NGOs as Peter Munk, Chairman of the Barrick Gold Corporation. They both attended the Davos Conference in Switzerland where Chairman Munk had this to say: Barrick Gold Chairman, Peter Munk complains rogue Environmental NGOs are Destroying the Mining Industry Apparently Bachelet was listening and took action?)

Various environmental activists have claimed that ANI’s methods include unnecessary measures like espionage and infiltration (ST, Dec. 10, 11). They are particularly upset by CONAMA’s support of the ANI investigation.

Director of Greenpeace Chile, Rodrigo Hererra, commented on CONAMA’s position Wednesday. “ANI’s report has very grave implications for freedom of expression in the environmentalist movement,” he told the Santiago Times. “I absolutely reject CONAMA’s support of their investigation. It is clear that CONAMA has no idea what methods the ANI is using.”

Lucio Cuenca, director of the Latin American Observatory on Environmental Conflicts (Olca), said that his organization – which campaigns against the Pascua Lama gold mine among other things – has been monitored by ANI since 2005 and has had negative experience with ANI’s questionable investigation tactics.

“It is legitimate within a democracy for the government to gather information on organizations,” he said. “It is not legitimate to deny people their liberty, intimidate them, and intervene in their civic participation as ANI has done.”

Cuenca said he was dissatisfied, though not entirely surprised, that CONAMA supports ANI’s investigation. He called on CONAMA to better fulfill its role as a facilitator of public opinion in projects affecting the environment.

CONAMA Director Ana Lya Uriarte has defended the ANI investigation. Her spokesperson, Jaime Ugalde, said, “It is necessary that in the democratic system that there exist investigation into the operations of organizations. But that does not necessarily imply infiltration or unnecessary persecution of said organizations.”

When asked about ANI’s supposed intimidation tactics, Ugalde said, “CONAMA does not have information that infiltration is one of the methods that ANI is employing. But if it is, then that is an issue that has to do with security, and should be left to the Ministry of the Interior. CONAMA does not have an opinion (on these allegations).”

CONAMA’s support of the investigation comes as the organization aims encourage more civic participation in its Environmental Impact Evaluation System (SEIA).

Urirate has launched a series of workshops set to last four months with the intention of surveying Chileans’ perception of the SEIA. Preliminary findings show that the general public believes there is not enough consideration of public opinion in CONAMA’s evaluation processes.

Uriarte says the survey of public opinion of the SEIA is part of a larger effort to restructure CONAMA to incorporate more avenues for the public to influence new projects.

But environmentalists are still dubious of CONAMA’s commitment to public participation. As Cuenca said, “CONAMA’s role should be to support free expression and ensure that people have all the information necessary to take part in the environmental impact evaluation process. But they do not do that. Instead, CONAMA misinforms the public by withholding necessary information on a given project.”

(This type of duplicity and corruption is characteristic of Chile and goes back a least a decade or more: Endesa Strategy & Tactics I – Revisiting the Ralco & Pangue Hydroelectric Projects on the Rio Bio Bio )

Here is the full article.

Chile Intelligence Agency Monitors Environmental NGOs

OLD FRIENDS: Endesa SA, Barrick Gold Corporation, Celulosa Arauco receive support from Chile's Intelligence Agency.

Environmental Activists Alarmed, But Not Surprised About The News

(Dec. 10, 2007) The Chilean daily La Tercera on Friday revealed that Chile’s National Intelligence Agency (ANI) has increased its monitoring of environmental NGO campaigns since the start of this year. The report specified that campaigns against the controversial Aysen dam project, the transnational Pascua Lama mining project, and Celulosa Arauco’s (CELCO) waste duct are receiving the most attention.

According to La Tercera, the ANI has been gathering information on how environmental NGOs function, who their principal members are, who provides them with funding, and how they respond to environmental issues nationwide. At least three ANI employees, including a former official from Chile’s National Environmental Commission (CONAMA), are known to be working full time on these issues.

Prominent environmentalists expressed no surprise, saying the news confirmed their belief that they had been placed under increased surveillance.

The Director of the Latin American Observatory on Environmental Conflicts Lucio Cuenca said he received several phone calls from ANI employees in 2005, looking for information about campaigns against Pasca Lama. Cuenca said he did not provide any information, but warned that officials continue to be very interested in the anti-Pasca Lama movement.

“They are keeping a close eye on our activities. But, we refuse to cooperate with them,” he said. “It is extremely worrying that, even though we are in a democracy, environmental movements are considered as a threat to the State.”

(NGO's were at the top of Barrick Gold Corporation's agenda at the 2007 Davos Conference in Switzerland: Barrick Gold Chairman, Peter Munk complains rogue Environmental NGOs are Destroying the Mining Industry )

Juan Pablo Orrego, coordinator of the NGO Ecosistemas and one of the leaders of the campaign against the Aysen dam project, had a similar response.

“There are people who are not comfortable with our work,” he said. “I suppose that this has to do with the fact that we could be creating problems for the government or obstacles for big businesses.”

“Several of our computers have been stolen, but these crimes appear to be totally selective,” said Orrego. “Additionally, we have received phone calls saying that we should be careful about what we do. We are being investigated, but I have no idea why.”

Meanwhile, current CONAMA Director Ana Lya Uriarte defended ANI’s work.

“All of our country’s institutions—including environmental organizations—form part of the analysis for national security. I think that it is natural — and also quite obvious — that there exist intelligence reports about organizations in this area,” she said.

(Not unexpected, as the Chilean government's lack of concern for the environment and support of the foreign owned extraction industry is notorious: Chile's Government fines itself for polluting the environment )

The on-going citizen education campaigns against the Aysen dam project, Pascua Lama mining project, and CELCO’s waste duct are arguably the three best known environmental initiatives in Chile.

The dam proposal, known as HidroAysén, calls for five massive hydroelectric dams to be built in far southern Chile’s Region XI, an area also known as Aysén. The dams are slated for the region’s two most powerful rivers: the Baker and the Pascua. Together the five generating facilities would produce an estimated 2,750 MW of electricity – roughly equivalent to 20 percent of the country’s current overall generating capacity.

The dam project has attracted significant opposition from local residents and environmental groups who say the dams will be socially and ecologically devastating for the pristine region. A planned transmission line from Region XI to central Chile has been a particular lighting rod for criticism, with opponents insisting it will be a major blight on the country’s landscape (ST, Dec. 6).

The Pascua Lama gold mine is set to be built in the Andes Mountains in an area straddling the border between northern Chile's Region III and Argentina. This bi-national location has led to several disputes between the two countries, including prolonged discussions on how to divide tax revenues earned from the project (ST, Sept. 12).

Environmental activists have lambasted the construction since it was first proposed, claiming the mine will destroy nearby glaciers and pollute downstream water supplies with waste runoff (VT, June 10). Barrick’s deplorable track record for environmental abuse is well-known: U.S. Vice-President Al Gore insisted upon removing Barrick Gold as a sponsor of his May visit to Chile (ST, May 11).

(Here is another classic Barrick Gold Corporation missive: Barrick Gold Corporation Chairman asserts that gold mines create jobs and feed people. (so would dismantling the Pyramids of Egypt) and here is the truth: Mining Misery: Guatemala is one of many countries that has attracted the investment of Canadian Mining Companies – but at what cost to its people? )

Finally, CELCO has been at the center of environmental controversy since 1996 when it first proposed to build a waste disposal duct from its Valdivia plant through the tiny Region XIV fishing community of Mehuín. Resistance in the town was initially strong enough to make CELCO back out of the sea duct project, opting instead to dump its waste water into the nearby Cruces River. But in 2004 the newly inaugurated Valdivia plant leaked untreated waste water into the river, killing off the black-necked swan population and setting off a firestorm of local and international protests. (ST, Dec. 3)

CELCO announced in October it had reached an agreement with Mehuín’s fishermen’s unions - paying members US$8.9 million in exchange for their acquiescence in the company’s waste duct plan. Initial reports indicated that 99 of Mehuín’s nearly 250 unionized fishermen had signed the agreement.

But, community leader Eliab Viguera recently told the Santiago Times that the opposition to the Mehuín duct is stronger and more widespread than ever before.

“It is no longer an issue of just Mehuín,” he said. “The movement has gained strength in communities throughout the Valdivia area (ST, Dec. 6).

Here is the full article.

Canadian Government Urged to Rein in Mining Sector

Canadian mining companies continue to come under scrutiny from civil society organisations for international human rights violations and environmental damage that critics say the Canadian government has done little to check.

Canada is a leader in the global mining industry, with almost 60 percent of the world's listed exploration and mining companies. The government supports some foreign mining activity through Export Development Canada, a federal agency.

"The situation is pretty grim," Joan Kuyek of Mining Watch Canada told IPS. "The mining companies are engaging in predatory activities. The laws and regulations don't stop violations of human rights or protect the environment. There needs to be immediate regulation of mining companies."

According to the Halifax Initiative, a coalition of labour and civil society organisations pushing for policy reform, Canadian mining companies have "been implicated in well-documented cases of human rights violations and environmental abuses ranging from the destruction of protected areas, to death threats and assassinations."

(Here are some examples: Mining Misery: Guatemala is one of many countries that has attracted the investment of Canadian Mining Companies – but at what cost to its people? , 10 Things Canada Does Best - What Canada doesn't do best is hold domestic mining companies accountable for the damage they do abroad. , Canadian, Goldcorp's open pit, cyanide-leeching mine runs up against local opposition in Guatemala , Canadian Barrick Gold Corporation Pascua Lama Project Protested - Al Gore insisted upon removing Barrick Gold as a sponsor of his May visit to Chile. )

In 2005, the Standing Committee on Foreign Affairs and International Trade for Canada recommended the creation of "a process involving relevant industry associations, non-governmental organisations and experts, which will lead to the strengthening of existing programmes and policies in this area, and, where necessary, to the establishment of new ones."

Another report written last spring, entitled "National Roundtable on Corporate Social Responsibility and the Canadian Extractive Industry in Developing Countries", also recommended a corporate social responsibility framework.

But even as Prime Minister Stephen Harper has refocused the nation's foreign policy agenda toward Latin America, a major source of Canadian mining investments, there has been little movement to implement these recommendations.

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The Canadian government has traditionally relied on voluntary compliance. There is still no commitment to establish legal norms in Canada to hold Canadian-based mining companies to account for violations overseas or to ensure that reporting is made available to markets and shareholders.

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In July, during a trip to Latin America, Harper met with officials from the company Barrick Gold, whose operations in Tanzania and Chile have come under fire for alleged labour and environmental violations.

Lucio Cuenca, of the Latin American Observatory on Environmental Conflicts, said at the time, "It is inappropriate that the prime minister meet with and give his support to the company at a time when the Chilean Congress is considering whether to investigate suspected irregularities in the Pascua Lama Project, the State Defence Council of Chile is contemplating suing Barrick for the destruction of glaciers, and a complaint regarding the project that was submitted before the Inter-American Commission on Human Rights is pending."

The Pascua Lama gold deposit being pursued by Barrick Gold is located in the Andes in an area rich with glaciers. Glacial run-off irrigates the productive Huasco valley, an agricultural center just south of the Atacama desert. The indigenous Diaguita community of Huasio-Altino claims that the concession includes part of its ancestral territory and is suing to recover the lands.

Here is the full article.

Corporate rights trump human rights - alleged that Canadian Barrick Gold security forces intentionally buried alive 52 artisanal miners in Tanzania.

Harper visits a foreign Barrick Gold operation for a second time this year

DAR ES SALAAM, TANZANIA, November 30, 2007: The Stephen Harper government is working quietly to stifle legislation in the Senate that would force companies like Barrick Gold, whose controversial operations he visited here this week, to respect human rights and the environment.

Harper had visited a Barrick operation in Chile in July. There, he met with company officials overseeing the Pascua-Lama mining project, which straddles the mountain border with Argentina and has been condemned by Chileans, as well as international environmentalists. In Tanzania, Barrick is strike-bound and the source of massive public protests for its employment and environmental practices. The Bulyanhulu Gold Mine there was the site of massive displacements of small-scale artisanal miners in the 1990s, and it is alleged that 52 of these miners were intentionally buried alive by company security forces.

"There is nothing more contested than resource extraction in the developing world," Gerry Barr of the Canadian Council for International Cooperation told HarperIndex.ca . "Developing countries give up a lot and get very little out of resource extraction, so it is a zone of intense social debate in Tanzania, no less so than anywhere else." He said a government review is underway there that may result in stricter rules for mining companies. "Until recently the nation has been very very permissive, with very modest royalties coming to the Tanzanian state as a result of mining."

Meanwhile Chile"s lawmakers are demanding a review of the Pascua- Lama project, where critics charge that three glaciers near the site have already shrunk by up to 70 percent due Barrick"s exploratory activities. Andes Mountains indigenous groups have complained to the Organization of American States that environmental damage from the mine will ruin their lands.

"The thing that has us scratching our heads is not so much that Mr. Harper is visiting resource extraction centres in the developing world but that his government has maintained a silence on the outcomes of a very remarkable process sponsored by its own Department of Foreign Affairs - a round table dialogue on resource extractions." He says the group "produced remarkable consensus-based recommendations." Representatives from industry, civil society groups and government "all agreed Canada needs a national corporate social responsibility framework with the expectation that all Canadian operators would comply with a key set of principles that would take account of human rights, labour standards, and a host of other issues including environmental impact and the rights of indigenous populations and communities to benefit from development."

Harper uses Senate to block Parliamentary legislation

At the same time, the Harper Conservatives are using procedure to block the the Canadian Senate from ratifying a bill that might put fetters on companies like Barrick. Bill C-293, the Development Assistance Accountability Act, is a private member"s bill that received third reading in the House of Commons last March but has not gone to the Senate for approval due to government opposition.

Here is the full article.

Argentina Mine Tax Threatens Stability, Investment -Industry

BUENOS AIRES -(Dow Jones)- By placing a new export tax on mineral exports despite a 30-year guarantee of tax stability, Argentina has shattered confidence in tax stability, which will discourage future mine investment, industry players said Wednesday.

On Tuesday, the mining chamber CAEM said that customs agents demanded the new taxes on Rio Tinto PLC's (RTP) Borax Argentina S.A., Procesadora de Boratos Argentinos S.A., Minera del Altiplano FMC and Xstrata PLC's (XTA.LN) Minera Alumbrera Ltd.

The companies previously had received letters from the Mining Ministry certifying that they would enjoy tax stability for 30 years, but this assurance was cast in doubt by the new tax.

Some companies immediately announced that they would challenge the new tax in court.
Borax Argentina is in the process of asking for an injunction after customs agents demanded a 10% export tax payment for its latest borate shipment.

"We will argue to the court that a note cannot modify a law," mine director Alberto Trunzo told local industry magazine Mining Press.

However, other companies were waiting for more clarity before reacting.
"We have a stability agreement at Veladero...(but) are monitoring and assessing developments," Barrick Gold Corp. (ABX) spokesman Vincent Borg said. Barrick operates the Veladero gold mine in Argentina and is developing the $2.4 billion Pascua-Lama gold mine project straddling the Chile-Argentina border.

Said the CEO of a company involved in exploration in Argentina and Chile: "This makes Argentina much less attractive for foreign investors. The effect won't be immediate, as companies have budgeted programs...The effects will show up initially with decreased exploration investment.

"This is a real problem for Argentina. There isn't a lot of mining investment in Argentina relative to its mineral potential," the CEO said.

The CEO asked not to be identified because of the sensitivity of the situation.
Lower margins due to the export tax will also push companies to mine higher grade ores, leaving behind more of the lower grade ores.

"Effectively this shortens the mine life, so in the end the government will get less revenue, less employment, etc.," the CEO said.

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Argentina mining hopefuls also have faced environmental resistance to development plans and a number of provinces have shut their borders to the industry.

In June, the province of Mendoza banned mining activity using chemicals such as cyanide, mercury and sulfuric acid, effectively shutting down gold and uranium mining.

A group of local mining companies and the Argentine government's national atomic energy commission, or CNEA, brought a lawsuit in Mendoza provincial court challenging the ban.

In addition, Calypso Uranium Corp.(CLP) announced Wednesday that it had filed a case before the Argentine Supreme Court challenging the constitutionality of the chemical ban in Mendoza.

A number of other provinces recently also have enacted laws limiting mining activity. Tucuman, Rio Negro and La Rioja provinces have all passed local laws banning open-pit mining using cyanide.

Meridian Gold Inc.'s (MDG) attempts to mine gold in Chubut province also have been on hold since a local court decision blocked the project in 2003. The Supreme Court upheld the decision earlier this year.

Despite the uncertainty, mining activity is experiencing unprecedented growth in Argentina due to high metals prices, large mineral potential and low extraction costs. Investment in mining projects reached $1.27 billion last year, up 56% from 2005, according to the Mining Ministry.

Investment across the country over the next eight years is expected to reach $12.5 billion as Argentina develops at least 10 new major mine projects, according to the ministry.

Here is the full article.

Canadian Barrick Gold Corporation Pascua Lama Project Protested - Al Gore insisted upon removing Barrick Gold as a sponsor of his May visit to Chile.

CHILE: PASCUA LAMA OPPOSITION REVIVES DURING SATURDAY MARCH

March Organizers: “We Have To Inform The Public Because The Mass Media Will Not”

(Oct. 29, 2007) Opponents of the Pascua Lama gold mine took to the streets of Santiago on Saturday to raise public awareness about the US$1.4 billion project that, they claim, will have terrible long-term effects on Chile's environment. Although environmental authorities have already approved the project, protesters said their continued resistance can halt the completion of construction (ST, June 26, 2006).

The noisy and vibrant procession of approximately four hundred protesters weaved its way through the bustling pedestrian streets of central Santiago, led by demonstrators hoisting a banner with a simple message: “No to Pascua Lama.” Puncturing the afternoon calm on one of the sunniest days of the spring season, the march rumbled through the heavy weekend traffic of shoppers and passers-by, accompanied by rumbling drums and chants of “Water, Yes! Gold, No!”

Organizers told the Santiago Times that the purpose of the spectacle was to let the public know that opposition to Pascua Lama remains, even as construction continues on the mine.

“This is a march to inform our neighbors that there are still plenty of obstacles for the completion of the mine,” said Consuelo Infante, head of the anti-mine group Citizen Movement. “We have to inform the public because the mass media will not do it, and it is very important that people know there is organized opposition to the project at this time.”

In addition to banners and songs, marchers distributed thousands of informational pamphlets to nearby Santiaguinos outlining the case against Pascua Lama and its owner – Canadian mining group Barrick Gold. Anti-mine groups said a series of logistical and administrative issues could still derail construction, including non-compliance with permit requirements and the refusal of Barrick to respect all aspects of the agreements that paved the way for the mine's construction.

March organizers claim these shortcomings by Barrick could halt the project, if only the government is willing to pursue existing legal complaints.

“Our case was presented at the beginning of the year and the state has not responded, so the courts are not accessible for us,” read the literature given out by marchers. “All of the complaints we have lodged have been rejected due to problems of form, and not substance.”

Barrick's project at Pascua Lama is no stranger to controversy. Environmental activists have lambasted the construction since it was first proposed, claiming the mine will destroy nearby glaciers and pollute downstream water supplies with waste runoff (VT, June 10). Barrick’s track record for environmental abuse is apparently well-known: U.S. Vice-President Al Gore insisted upon removing Barrick Gold as a sponsor of his May visit to Chile (ST, May 11).

Here is the full article.

More on Pascua Lama here: Pascua Lama Gold Mine: A Contemporary Quest for El Dorado

Barrick Gold Executives - We don't represent the people, its the state authorities who represent the people. We are in for profit.

Memorable Quotes:

Peter Munk:

"Gold is not more precious (than water) but jobs are."

Peter Munk's Sidekick:

"We don't represent the people, its the state authorities who represent the people."

"We are in for profit, as you know. We are a free enterprise."

"It is the State Authorities that are there to protect you."

More Peter Munk wisdom here: Barrick Gold Chairman, Peter Munk complains rogue Environmental NGOs are Destroying the Mining Industry

Washington Post article here: In Chile, Precious Lands Often Go for a Pittance - Barrick Gold Corporation Pays $19 Dollars for 20,000 Acres

Endesa SA plans 5 additional dams to coincide with the HydroAysen Project

WATER RIGHTS: A HOT-BUTTON ISSUE IN CHILE

(June 28, 2007) Water rights - as they relate to hydro-power in the south, industrial needs in the northern mines, or irrigation in the Central Valley vineyards – are a big issue in Chile. But who owns Chile’s water rights, who administers them, and are fears justified that Chile’s water could be monopolized by an economic juggernaut?

The General Water Directorship, or DGA, administers the nation’s water code, which is supposed to regulate water rights and to prevent monopoly ownership. The DGA was in the news last week when Chilean legislators cited a 2002 DGA report documenting substantial damage to Chilean glaciers by Canada’s Barrick Gold. The damage occurred during extra-official surveying work done at Barrick’s Pascua Lama gold mine (ST, June 26), but the DGA report was not considered by Chilean environmental authorities when they later granted Barrick authorization for their project.

In May the government’s Free Competition Defense Tribunal, FCDT, ordered the Endesa energy company to report about its water rights holdings throughout the country in order to determine the effect the proposed Aysen dam project – developed by Endesa and the Colbún Electrical Company - would have on the energy market.

Endesa responded to the FCDT enquiry reporting that while it owned substantial water rights in Regions XII and IX, most of its water rights were concentrated in Region X. Its water rights holdings, said the company, are all confined within the Interconnected Central System (SIC) of energy and total 40 percent of the total water rights within the SIC.

Endesa said it already generates 3,400 megawatts of power; its proposed collaboration with Colbún on the Aysen dam project would give it an additional 2,400 megawatts of power generating capacity.

The company also outlined additional water rights applications now in process before the DGA. If approved, these new water rights would open the door for five additional hydro projects that would generate another 1,081 megawatts of power.

Also in May, various Chilean farming operations sued the DGA, saying it wrongfully charged them exorbitant licensing fees under new provisions in Chile’s water code. The farmers hold water rights titles allowing them to exploit groundwater on their property, but were recently placed on a DGA list of “non-complying” companies that allegedly owe thousands of dollars in licensing fees.

Here is the full article.

Barrick Gold Corporation abandons mine in Argentina citing RABID LOCAL OPPOSITION – cites rising Resource Nationalism as cause

Translation: The World against Barrick Gold / Here are the guilty henchmen of the bi-national Pascua Lama mining project: Mulet, Frei, Trivelli

Risky business

[Thu, 22 Nov 2007] IT’S A TWO-HOUR charter flight to get to Cerro Vanguardia, the AngloGold Ashanti gold mine tucked away in the nether regions of Patagonia, Argentina. At the mine the landscape is oddly reminiscent of the Karoo.

St Julian, 150km to the east, is the nearest settlement: a craggy, windswept town that derives much of its employment from AngloGold’s open pit operations. While there are benefits for places such as St Julian from the mining that impacts on its community, other provinces in the country are turning their backs on the prospect of digging for minerals.

That’s just one element of the growing trend known as resource nationalism. Central and provincial government, local communities plus pressure groups – either working together or in isolation – are harassing resources companies: in general, lobbying for a larger share of revenues or raising environmental concerns. In Argentina, the La Rioja, Rio Negro and Tucuman provinces have totally banned open pit mining.

Earlier this year the provincial government of Mendoza province, known for its vineyards and ski resorts, banned open pit mining. The ban was short lived but sent up a warning flare for those mining in Argentina.

The opposition to mining in some areas isn’t necessarily resource nationalism in its true sense: which is to say, governments leveraging their power to gain more for the country. But it is a reflection of a growing trend, where communities and governments are increasingly aware of how they can influence what happens around them, on occasions shunning investment in their local resources and at other times welcoming it but demanding a larger slice of the pie.

In March, Barrick Gold said it would leave the site of its proposed mine in the Famatina Mountains in the Argentine province of La Rioja after rabid local opposition. Provincial governor Angel Maza, which the local opposition claimed was too close to Barrick, was suspended.

Such experiences haven’t deterred mining companies in their quest for resources in Argentina. AngloGold continues to invest in Cerro Vanguardia. It’s lifted by $1m its five-year, $20m exploration budget as it looks to expand production past the mine’s current life of 2018. Other companies continue working on various projects and diversified resources company Xstrata may start developing a new copper mine in Argentina’s San Juan province in year a or so.

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Power sees resource nationalism in its many forms and as part and parcel of current resources business. He says integration into and acceptance by the local community is key for any successful Brownfield and, in particular, Greenfield mining operation in many emerging markets.

A number of South American countries (apart from Argentina, where most of its indigenous people were wiped out by the Spanish invaders) have large, indigenous under classes. As democracy grows many politicians in South American countries aim to represent those communities, turning to them increasingly for support.

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The speed of Chinese growth and that country’s emergence as an economic and increasingly political powerhouse also plays a part in resource nationalism. “Chinese demand for resources is growing exponentially and China’s prepared to write cheques to obtain access to resources. The price at the margin isn’t something they’re overtly concerned about.”

Says Powers: “They’re bringing a can-opener – in terms of funding for infrastructure projects, often rail and road links that would enable any mine to transport its minerals from isolated areas to market. I suspect when the minerals become available China (where it’s invested in infrastructure, etc) will have the first right of refusal.”

Here is the full article.

Barrick Gold Chairman, Peter Munk complains rogue Environmental NGOs are Destroying the Mining Industry

In the communities of Peru, where new copper mines are planned a referendum on mining was held.

Votes cast: 8,873 (48.17 percent of the total electorate)
Votes in favor of mining in the district: 176
Votes against mining in the district: 8,294



It would appear the people of Peru disagree with Peter Munk and the Barrick Gold Corporation.

Want to see more outrageous assertions from the Barrick Gold Corporation? Watch this next video: Barrick Gold Corporation Chairman asserts that gold mines create jobs and feed people. (so would dismantling the Pyramids of Egypt)

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It is not the Environmental NGO's that are out of control, but the rogue Canadian Mining Industry:

Mining Misery: Guatemala is one of many countries that has attracted the investment of Canadian Mining Companies – but at what cost to its people?

Canadian Government Urged to Rein in Mining Sector

10 Things Canada Does Best - What Canada doesn't do best is hold domestic mining companies accountable for the damage they do abroad.

In Chile, Precious Lands Often Go for a Pittance - Barrick Gold Corporation Pays $19 Dollars for 20,000 Acres

Canadian, Goldcorp's open pit, cyanide-leeching mine runs up against local opposition in Guatemala

Canadian Barrick Gold Corporation Pascua Lama Project Protested - Al Gore insisted upon removing Barrick Gold as a sponsor of his May visit to Chile.

Corporate rights trump human rights - alleged that Canadian Barrick Gold security forces intentionally buried alive 52 artisanal miners in Tanzania.