"Chile is the best mining jurisdiction in the world... Canada is not a jurisdiction where I would like to develop a mine." says Centenario Copper CEO

Risk not a factor in this offer

Maybe having a former investment banker running a company is the best way to ensure investors are protected in the event that things don't work out properly.

Or maybe the same level of protection can be achieved by having a chief executive decide the risk should be borne by the company -- and not by the investors.

Whatever the source, investors in a US$80-million private placement done for Centenario Copper Corp., were protected in the event the issuer didn't receive the necessary permits. Centenario was formed in 2004 and operates in Chile.

"I didn't want us getting caught in the position where we were seen to be bagging investors," said Richard Colterjohn, chief executive of Centenario and a former investment banker with UBS Securities.

In July, Centenario raised US$80-million by selling 16 million special warrants at US$5 per warrant. The capital was raised after the company completed a bankable feasibility study. "I am very interested in speed of execution. So rather than waiting around to do a prospectus and then do a traditional IPO structure, we did a special warrant financing to accredited investors and gave an undertaking that we would become publicly listed within 120 days," added Colterjohn in a phone conversation from Chile last week.

(Canadian law allows this, sadly to the detriment of the host countries: 10 Things Canada Does Best - What Canada doesn't do best is hold domestic mining companies accountable for the damage they do abroad. , Canadian Government Urged to Rein in Mining Sector , Mining Misery: Guatemala is one of many countries that has attracted the investment of Canadian Mining Companies – but at what cost to its people? )

But releasing the proceeds from that financing was made conditional on getting a final Environmental Impact Statement approved, said Colterjohn, noting that despite giving the investors an out in the event that the permit wasn't received, he remained confident it would be.
"As far as I am concerned, Chile is the best mining jurisdiction in the world and we were highly confident we would get it. In fact, we did get it before we closed the financing."

(Mining is so good in Chile that the National Intelligence Agency (ANI) monitors all environmental NGOs that oppose mining: ANI or DINA? Environmental organizations protest espionage and infiltration by Chilean Intelligence Agency , Legislators angered by Chile Intelligence Agency monitoring of environmental organizations - investigation demanded , Chile Intelligence Agency Monitors Environmental NGOs )

Colterjohn, whose company's shares have been trading since mid-October following the receipt of a prospectus to clear the private placement, said that approach was adopted because he "was completely prepared to eat that risk in order to minimize that dilution. And I got better pricing for doing it," he said. The reason: with permitting risk not a factor, investors could focus on the merits of the company's copper project, knowing that in the event the permit wasn't received, they would get their money back--plus a tad more.

"It was a decision that [the permitting] risk belonged with us rather than with the investor and, thereby, we gave them greater comfort," he said.

Colterjohn was asked about the lack of a similar out in a $200-million financing done in March for Gabriel Resources, a company with a gold project in Romania -- but no permit. "It's an incredible geological potential, but you have a bunch of locals who don't want you. Mining has to go where it's wanted, and I am where I am wanted," he said.

(Read more about Gabriel Resources and Romania here: Canadian gold mining corporation, Gabriel Resources Ltd. halts Romanian project as support sours - NGO's influence cited , Battle over gold mine plan that would create giant cyanide lake. , Mine Your Own Business - The Darkside of the Environmental Movement? - watch the groundbreaking video trailer below )

He was asked what he would have done had he been running Gabriel and decided to raise $200-million. "The reality is that there is permitting risk. From the company's perspective, it was more important to get the funds in and to continue to drive the project forward and to continue to develop support. Mining people by nature are optimistic and believe that sooner or later they will get there. But it's a judgment call," he said.

Colterjohn was asked about permit risk in Canada. He replied, "Canada is not a jurisdiction where I would like to develop a mine."

(Naturally, countries with weak governments and environmental laws attract miners: Chile's Government fines itself for polluting the environment . Compare that to what recently happened to a number of US paper companies : US Environmental Protection Agency forces paper companies to begin $400 million clean-up project to deal with PCBs in the Fox River . )

Here is the full article.

Canadian Uranium One's dam bursts in South Africa

Canadian miner Uranium One Inc. said on Monday that a storm water containment at its Dominion Reefs uranium mine in South Africa burst over the weekend after 58 millimeters of rain fell on the area in 30 minutes.

The company said it repaired the damage, and estimates that about 100 megalitres of water was discharged into a nearby stream that feeds the Vaal River.

"Based on initial water sampling and analysis," the company said in a statement, it "does not expect any environmental impact due to the discharge." (There never is, and thankfully it did not occur in Canada.)

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.

-------------------

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.

------------------

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.

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

Excerpted

In a 2005 series called "10 Things Canada Does Best," The Globe and Mail declared Canada a world leader in raising capital for mining ventures. Mining companies raised U.S. $4.2 billion on Canadian stock markets in 2005, and 85 percent of mining deals done worldwide that year were based in Canada.

According to the Department of Foreign Affairs and International Trade (DFAIT), almost 60 percent of the world's mining and exploration companies are listed on the Toronto Stock Exchange or the Calgary-based TSX Venture Exchange. Canadian mining companies account for over 40 percent of global exploration budgets and nearly 3,200 concessions in more than 100 countries.

What Canada doesn't do best is hold these domestic mining companies accountable for the damage they do abroad.

The tale of Chichipate, a Guatemalan village whose fate is controlled by a Canadian company, is a study in the harm done by Canada's mining sector in developing countries. It's a story that traces the origin of one source of Canada's wealth and calls into question Canada's self-image as a champion of human rights.

The strength of the Canadian mining sector has its cultural roots in our traditional identity as hewers of wood and drawers of water. Our history as a resource-based economy has created a cadre of geologists, mining engineers, managers, investment bankers, industry analysts and brokers with technical expertise in mining.

But there are also structural reasons for Canada's dominance. "It's relatively easy to float a mining company on the TSE," says Jamie Kneen, communications co-ordinator for Mining Watch, an Ottawa-based NGO that monitors the Canadian mining industry. "The information requirements are lax compared to the United States." The New York Stock Exchange has stricter disclosure requirements about the environmental impact of a company's operations, and it forces companies to abide by U.S. accounting rules, which are more exacting than Canada's regarding how companies place a dollar value on mining assets.

The website of the Mining Association of Canada boasts about Canada's lenient disclosure requirements. The TSX rules, it says, are "designed around the needs of the mining industry."

As a bonus, Canada has tax loopholes that benefit companies incorporated in Canada, with operations abroad. To avoid the possibility of double taxation, companies are assumed by the government to be paying taxes in the countries in which they operate. But because many companies make arrangements with host countries not to pay taxes there either, they don't pay taxes anywhere.

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

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

MUST SEE VIDEO: Watch Canadian Skye Resources mining company evict an entire village of indigenous Mayan Indians in Guatemala.

The town of El Estor, on the shore of Lake Izabal in eastern Guatemala, was founded at the time of the conquistadores. The lake's strategic location on the Río Dulce, the gateway to the Caribbean, allowed its denizens to prevent pirates from entering the country. Today, it is an area dominated by banana plantations and cattle ranches.

The road to Chichipate, one of the traditional Q'eqchi' Mayan villages surrounding El Estor, is lined with majestic conacaste trees, their massive crowns sprawling sideways. Boys on bicycles carry bundles of firewood gathered from the mangle tree. Women in güipiles, colourful woven blouses, carry infants strapped to their backs. Some seven kilometres from Chichipate, an abandoned nickel mine looms. Now a ghost town, the vast complex once included a smelting plant, administrative offices, employee housing, a school for the children of employees, a golf course and a movie theatre.

Outside Chichipate, Martín Col Caal, a 21-year-old subsistence farmer, is cobbling together a makeshift shelter, using tree branches and palm leaves, for his wife and two young children. About 200 other indigenous families are here in the grassy valley, dubbing their new home Barrio de la Revolución -- Neighbourhood of the Revolution. Today, a steamy day in September 2006, more than 3,000 indigenous people from Chichipate and El Estor have set up similar households on five different sites, defiantly claiming the land as their own, land they say was stolen from their grandparents in the 1960s.

Skye Resources, a Vancouver-based junior mining company, which bought the land from Canadian mining giant Inco in 2004, has different plans for the site. With the price of nickel at a 19-year high, Skye intends to re-open the mine in 2009, with construction slated to start this year. The indigenous occupants say they are not here to protest the mine--they simply need the land to subsist. But one of the five groups is sitting on a nickel deposit. Either the mining company or the squatters will have to go.

History is repeating itself in Chichipate. The families of the protesters have been living in the area since the 1930s, but in 1965 the government of Guatemala sold the land to Inco. When community leaders found out, they demanded the government give back the land. In the early 1980s, after much bloodshed, the government ceded an area smaller than the actual size of the village to the community; people living outside its confines were forcibly relocated. But now, with the community burgeoning and a shortage of arable land, Chichipate is not enough. "We just want a patch of land that we can leave for our children," says Col Caal. "We want the company to negotiate."

When the police arrived on a Sunday afternoon two months later, shooting 12-gauge shotguns in the air, the women and children began to cry. Using loudspeakers, the men asked the police under what legal authority they were acting. Police responded by lobbing canisters of tear gas. Col Caal's wife picked up their two small children, aged one and three, and ran in to the mountains. "The company talks to the president and to the mayor," says Col Caal. "Why doesn't it talk to us?"

Despite its history of intercepting plunderers, El Estor has been less successful fending off the latest fortune hunters.

Events like those in Chichipate have played themselves out across Guatemala as the government, strapped for cash and anxious to lure foreign investors, has sold off mining concessions -- tracts of land from which companies can extract mineral resources -- at a bargain U.S. $120 per square kilometre. As of December 2006, according to Guatemala's Ministry of Energy and Mines, there were 356 mining licenses granted and an additional 250 concessions in the process of being granted. Andrés McKinley, the Oxfam America extractive industries person, estimates the concessions cover more than 10 percent of the country, and that Canadian companies own 80 percent of them.

Read the full article here.

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

Guatemala: Trial of "GoldCorp 7" Begins

[Wednesday, 14 November 2007 ] On November 12, 2007 the oral presentations in the trial against the "Goldcorp 7" began. This is a politically laden case against seven Mam-Mayan community members from the very villages in the municipality of San Miguel Ixtahuacan (department of San Marcos) that are being gravely harmed by Goldcorp's open pit, cyanide-leeching mine.

BACKGROUND

On January 9, 2007, representatives from the Mam-Mayan villages that neighbor the "Marlin" mine in San Miguel Ixtahuacan, San Marcos, Guatemala, operated by Goldcorp Inc's wholly owned subsidiary Montana Exploradora, visited the mining company office. They presented a petition to Goldorp Inc. requesting a resolution to a number of problems suffered due to mining operations.

COMMUNITY CONCERNS INCLUDE:

* Extremely low payments made to local families for lands acquired, according to testimonies, under false pretenses and in some cases through coercion.

(This is typical, see: In Chile, Precious Lands Often Go for a Pittance - Barrick Gold Corporation Pays $19 Dollars for 20,000 Acres )

* Destruction of dozens of homes due to the use of explosives.

* Water contamination (due to use of cyanide and release of heavy metals due to the open pit mining process) resulting in health problems of people and livestock.

* Water depletion due to an apparent lowering of the regional water table resulting in the drying out of wells and natural springs, and some crop failure (ex: fruit trees).

On January 10, community representatives returned to the Goldcorp offices for the response to their petition. According to testimonies, company representatives not only denied all responsibility for the problems, but also insulted them. The community representatives left the company's installations and began walking to their homes. About two kilometers from the mine entrance, members of Goldcorp's private security company attacked the campesinos throwing rocks at them and firing guns, and attempted to force one man into a company car.

The men defended themselves as best they could. Though they suffered some injuries, they escaped and called the police. The police came but did not take testimonies or initiate the necessary investigation into the actions of Goldcorp's security company.

That afternoon, upon hearing the response of the company to their petition, approximately 600 members of communities that neighbor the mine (Agel, San José Nueva Esperanza, Salitre and San José Ixcaniche, of the municipality of San Miguel Ixtahuacán, and Tzalem of the municipality of Sipacapa) peacefully blocked roads to the company installations.

According to testimonies, on January 11, in the midst of the growing protest, community representatives, accompanied this time by the Human Rights Procurators Office (PDH), visited the company offices again to solicit dialog with the company in relation to the damages suffered. The Canadian security manager insulted them (calling them trash, murderers, etc.), and threw them out of the offices.

That day anti-riot forces of the National Civil Police and between 300 and 500 Guatemalan Army soldiers arrived.

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)

--------------------

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.

Ransacking Chile - Fabulous Profits for Multinationals

The rise in copper prices has produced euphoria in the government and ruling elites, despite relative complications for certain exporters. The price rise seems not to be a momentary phenomenon. Although abundance is not noticeable in the daily life of Chileans, three out of four expect that the price rise will raise their living standards. Everything is looking good. But a kind of conspiracy of silence hides something basic. The ones who do best out of the copper price are the multinationals who manage two thirds of Big Mining, not Chile. The multinationals are the main winners : they pay low taxes and walk off with colossal profits.

The figures are startling. With copper at US$2.60 per pound, the profits leaving Chile for production in 2006 will be US$16 billion. More than twice the surplus of CODELCO One is dealing with real plunder, the culmination of an open handed policy towards the multinationals that began with the dictatorship and has been maintained to the present day and which, apparently, President Bachelet wants to continue. Punto Final talked to the economist Orlando Caputo of the Study Centre CETES, an academic and expert in copper and the world economy.

PF. What is the situation relating to multinational profits in Big Mining of copper during this period of high prices?

OC. The profits of the foreign companies that control 70% of Chilean copper are so high that they are equivalent to more than twice the surplus of CODELCO. El Mercurio (3) on April 30th reported that in the first quarter the profits of Escondida (4) were US$1.136 billion, which means more than US$5 billion for the whole year, including taxes. One has to take in the general panorama and we can use data from recent studies. There is no information from the multinationals since they are not obliged to publish accounts. We can only make deductions. There are figures for profits sent overseas resulting from direct foreign investment, which are after-tax profits. The significant figures are these : 1999, US$1.603 billion; 2002, US$2.557 billion; 2003, US$4629 billion; 2004, US$8.231 billion; and 2005, US$11.088 billion.

These figures include the total of foreign direct investment but help us get to the figures for the mining multinationals. If we discount profits of foreign non-mining companies, we arrive at the companies that are, namely, the copper mining companies. To their profits we need to add remittances made up of accelerated depreciation and other items that we can consider as earnings. We can conclude from these calculations that the surpluses of the mining multinationals were approximately US$10 billion in 2005. This year however, when prices and their trends are higher, the surpluses of the copper mining multinationals are around US$16 billion. A figure that would finance the new social program announced by Michelle Bachelet for 27 years.

To appreciate what these earnings mean we can establish other relations. One is that which exists with the material investments made, which together with labour and the natural resource itself, constitute the source of those profits. According to the Foreign Investments Committee, that investment in the mining sector for the period 1991 - 2004, that is to say the democratic period, was US$16 billion in round figures. That figure is practically the same as the earnings for 2006. In just one year the multinationals will earn the same amount that they invested over 14 years, and the investments in the democratic period represent more than 80% of the investment in copper Big Mining since 1974.

Here is the full article.

Chile's 21st Century Gold Rush

Environmentalists Upset With Increased Investment In Gold Mining

[Sept. 13, 2007] After spending much of the past year prospecting for gold in southern Chile, U.S.-based mineral exploration company Geocom Resources has now narrowed its search to three specific areas, all in Region X.

Geocom – which is working in collaboration with the Kinross Gold Corporation – announced the elevation of the Espolon, Cerro Mera and Cerro Vaca gold claims to “formal venture status.” Its partner in the joint venture, Canada’s Kinross, is the world’s eighth largest gold mining company. Kinross is also a major player in Chile, where it holds an estimated 18,500 tons in gold deposits.

In a telephone interview with the Patagonia Times, Geocom CEO John Hiner was careful to explain that the Region X projects are still very much at an exploration stage. Elevating the three claim blocks to formal venture status, he explained, “is basically saying these things may have some interest.”

“It’s all basically exploration,” he said. “We don’t know what’s there. We have to continue exploration, but by the agreement with Kinross, we have to do it as a formal joint venture.”

At this point, he added, it’s not even clear whether the claims – which together cover several thousand hectares of land – are rich enough in gold, copper and silver deposits to even warrant setting up mines.

“It’s at such an early stage, it’s going to be difficult to say with certainty that there’s mineralization of any economic interest there. That’s the reason for doing the work now. So I guess the next year or two will tell us whether or not there’s mineralization to justify continued work,” said Hiner.

Increased Investment In Gold Mining

While Tuesday’s announcement may never develop into a really important mining venture for Geocom, it is still a timely reminder of how foreign companies are increasingly investing in Chile’s gold mining potential.

By the end of next year, according to a recent study by the Chilean Copper Commission, gold mining companies will have invested some US$3 billion here since 2004. A good portion of that money comes from Barrick Gold, a Canadian company behind the controversial Pascua Lama project in Region III.

But with Kinross, Swiss mining company Xstrata and other corporations also banking on Chilean gold, investment in gold and silver mines could, by 2011, come close to matching that of copper, the daily El Mercurio (citing Mining Industry stats) reported this week.

The trend may be due partly to the fact that Chile’s copper industry is in many ways saturated – there isn’t a lot of room for growth. Another factor has to do with waning confidence in global stock markets, and in traditionally stable currencies like the U.S. dollar, explained economist Bernardo Reyes Ortíz.

“There’s a general concern that things aren’t going well…That leads many people to seek refuge in more solid currencies, not, in this case, the U.S. dollar. The most likely alternative is gold. That, then, is a driving force pushing up investment in gold mining,” said Ortíz, who works for the Santiago-based Ecological Policy Institute (EIP).

A third factor, at least in southern Chile, may have to do with planned infrastructure changes. In isolated Patagonia, plans by the Chilean government to extend the Carreterra Austral (Southern Highway) would no doubt make mines or any other industry planned for the area all the more cost effective.

So, too, would the so-called Aysén Project, a US$4 billion hydroelectric scheme planned for Region XI. If approved by the government, the Aysén Project – which plans to build five massive hydroelectric dams that would then be linked to Santiago via a 2,000-kilometer transmission line – could provide easily accessible electricity for a host of local mining ventures in the future.

“There’s a clear relationship,” said Víctor Formantel Gallardo of the environmental NGO Ecosistemas. “Once they’ve come here and built a 1,000-kilometer high tension line that stretches to Puerto Montt, and then reaches from there through the valleys and foothill areas for another 1,000 kilometers all the way to Santiago, at that point there really will be no reason for them not to come and extract the region’s very real mineral resources.

--------------------

“The types of process that are used in gold mining have an even greater environmental impact than copper mining, because of the types of chemicals that are used, and the types of residues that are left behind,” said Ortíz.

Another vital issue has to do with water supplies. Gold mines require a tremendous amount of water. And in Chile’s dry northern regions – home, for example, to Barrick Gold’s Pascua Lama project, that can be particularly problematic.

“These projects are often being prepared in semi-arid or arid areas, where there’s already a major water supply problem. The mines tend to be set up near the headwaters of river basis, which can end up having multiple economic affects downriver;” said Ortíz.

In the much wetter southern Chile, where Geocom and Kinross are conducting their explorations, gold mining could precipitate another environmental problem – landslides, according to the EIP economist. Open-pit gold mining necessarily involves removing ground vegetation, and in rainy areas like Region X or XI, that could increase the likelihood of erosion and dangerous landslides.

“No company can guarantee that there won’t be accidents…Especially when it comes to large-scale operations. And we’re not talking about small gold mines here, we’re talking about large-scale operations, the majority of them open-pit. These aren’t underground mines,” said Ortíz.

Here is the full article.

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

SANTIAGO, Chile -- The mountainous terrain of northern Chile is studded with precious metals, a natural cache that for years has had investors angling for land rights.

So when the world's largest gold mining company targeted about 20,000 acres owned by Rodolfo Villar, a mineral speculator, he signed a contract. Only later, he said, did he realize how much the company had agreed to pay him:

About $19.

Villar, who regularly grabs local land rights if he thinks they might be worth something, said he thought the deal was worth $1 million, not an amount that proved to be less than the cost of a bus ticket from Santiago back to his house. Additionally, the finer points of the contract stipulated that he would be fined $95,000 if he tried to obtain rights to any other parcels in the surrounding area.

Villar sued the company, Canada's Barrick Gold Corp., arguing that he had been deceived. This year, a Chilean judge ruled in his favor, saying that the company had essentially swindled Villar, and ordered the lands returned to him.

Here is the full story.

Mining Giants Account For Fifty Percent Of All Corporate Profits in Chile

CHILE’S BUSINESSES SHOW STRONG RESULTS THROUGH 3rd QUARTER

Mining Giants Account For 50 Percent Of All Corporate Profits

(Nov. 2, 2007) Chilean enterprises have done well this year, showing an overall 12 percent increase in profits from January through September, as compared to 2006. Big winners are the mining and forestry companies.

Profits at all businesses are up by US$22 billion compared to September, 2006, according to figures by Chile’s Securities and Exchange Regulator (SVS). Total sales add up to 164 billion, a 14.9 percent increase compared to same period last year.

The two largest mining companies, state-owned CODELCO and BHP Billiton’s Escondida, accounted for 50 percent of total profits in Chile. CODELCO registered overall profits of US$6.7 billion in the first nine months of the year, while Escondida saw its profits grow to US$ 5.3 billion in the same period. But while Escondida’s profits are up by 28.3 percent compared to last year, CODELCO saw its profits diminish for the first time in five years, down by 7 percent. The state-owned mining company has seen its production costs rise considerably, affecting overall profits.

Of the country’s economic groups, the two largest, the Matte and Angelini consortiums, have profited the most this year. Cellulose-company CMPC - part of the Matte group - has seen its overall profit for the first nine months this year add up to US$377 million - an impressive 128.3 percent increase compared to the firsty nine months of 2006. Angelini’s CELCO showed an overall profit of US$534 million, a 25 percent increase compared to September last year. The positive numbers are attributed mostly to record prices for cellulose and a sharp increase in production capacity.

Here is the full article.