Canadian gold mine plan stirs anger in Central America

| August 18, 2010
Canadian gold mine plan stirs anger in Central America

Canadian gold mining explorations in Central America might be close to expanding with a new project potentially going ahead in Costa Rica.

Industrias Infinito S.A., owned by the Calgary-based Infinito Gold Ltd., is a mine company that is trying to win a legal battle with the new Costa Rican government to push for the Crucitas project in the small community of Las Crucitas, north of the border of Nicaragua.

Laura Chinchilla, Costa Rica's new president, revised the contract that former president Óscar Arias signed with the Canadian firm months before reaching the end of his presidential term.

But Chinchilla is under pressure from environmental groups, such as "Ni una Mina más" translated as "Not a single mine," to put a stop to the project.

They argue that mining explorations in the area, and this open-pit mine, in particular, has the potential to destroy the zone's habitat including the contamination of the Infiernito River.

Costa Ricans are not alone on this battle. Nicaragua's government and Nicaraguan environmentalists are also against it arguing that the San Juan River -- the largest in Central America and whose ownership has been disputed between the two nations for decades -- is at risk of contamination from mining activities.

Jhonny Gutiérrez, mayor of the small community of San Carlos near the San Juan River on the Nicaragua side, said that they are trying to restore a system of coexistence, but " instead" he said "we are surrounded with a system of consumption -- neoliberal -- that cares little for the environment -- that prefers to turn natural resources into capital ones where the human being is what matters the least." 

He also said that even though the project is in neighboring Costa Rica it will affect Nicaraguans because they "are an integrated system."

"It will contaminate our waters," he said referring to the San Juan River.

After many considerations since she took office this past May, Chinchilla decided that her administration would not break the agreement that Arias signed on the basis that it would be of "national interest." The case is now it is in the hands of the Contentious Administrative Tribunal to decide the future of the open-pit mine.

Last week, Costa Rica's first vice-president, Alfio Piva, said that the government might have been required to pay the estimated amount of US$1.7 billion to Infinito Gold Ltd. as a penalty for breaking the contract.

But the mine's Manager of Corporate Relations, Juan Carlos Obando, said they are not paying attention to this figure as they don't expect to reach to this scenario -- alluding that the project is here to stay.

The presence of Canadian mining companies in Central America has become a controversial issue.

Earlier this year, CTV's investigative W5 staff sent four of its crew members to Guatemala to investigate about Canadian mining companies practices there.

"Searching for gold at the end of the Guatemalan rainbow," is the documentary the network broadcasted early in April as a result of the investigative report.

In it, human rights activists and environmental groups blame the operating Canadian mining companies such as Marlin -- owned by Gold Corp. -- for rare skin diseases some children are suffering, among other things.

Gold Corp operates in Honduras and Guatemala employing close to 1,200 people in the latter one. They've operating in Guatemala since 2005 and plan to stay until 2015

Hudson Bay Minerals also operates in Guatemala. People dread it for its impact on the land of their ancestors. But the Guatemalan government defends their decisions to allow mining in these communities by saying that the state owns the mineral rights.

B2GOLD is another mining company and although it is Canadian it is not as controversial as the other ones because it has been known to practice more responsible mining. It operates in Nicaragua.

According to its president Clave Johnson, they've substituted traditional mining methods by using mitigation systems that allows them to extract 94 per cent of the gold without leaving too much of an environmental impact.

Nicaragua's president Daniel Ortega has applauded the initiative in a re-inauguration ceremony earlier this year.

Mining in Central America has brought eruptions of violence as people are often evicted from their lands by the military to make room for the mining companies.

The Canadian government has been heavily criticized for investing in mining companies operating abroad with Canadian pension plan funds

The opposition, particularly Liberal MP John McKay, is trying to pass on The Responsible Mining Bill a.k.a Bill-C300

If passed, it would allow the Canadian government to hold these mining companies accountable for environmental and human rights violations.

MPs will debate the bill for a third time at the House of Commons when they resume parliament sessions this fall.

Costa Rica hopes to resolve Las Crucitas project's issue within the next six months.

If approved, environmental groups say that it violate the 1972 Agreement of Stockholm on environmental rights, the Convention of Rio de Janeiro, on the protection of the biodiversity, and Agenda 21 on sustainable development.

Natalia Cuadra is a freelance journalist in Nicaragua, with a journalism degree from the University of King's College in Halifax. She worked for Xinhua News Agency in Honduras during the military coup, and writes for Nicaraguan newspapers and magazines.

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