CHILE: WHY CODELCO WILL ALSO FAIL IN INTAG in 2012, 2013, 2014,,,,,,

By , July 16, 2012

CHILE: WHY CODELCO WILL ALSO FAIL IN INTAG in 2012, 2013, 2014,,,,,,

I posted the blog below in August of 2011 when Codelco was lying its way into the hearts of the residents of Paraiso, a community not too far away from Junin. Back then I predicted that the Paraiso mining concession, of only 800 hectares, would prove to be too small for the company, and that their real interests were in Junin . On my previous blog, I reproduce the Bloomberg article published just this last friday, which reports that, lo and behold!, Codelco is after JUNIN concession, after all. It wasn’t too far back that Codelco publicly denied they were interested in Junin. The talking heads interviewed in the article lie shamelessly about the potential worth of the JUNIN deposit, saying or implying it is one of the world’s largest copper deposits. It is not.

 After years of exploring, the Japanese INFERRED, the possible existence of 2.26 million tons of copper. This makes it a small to medium copper project, if the deposit is proven at some point in time. There are no less than 20 other sites around the world with larger copper deposits, including some in Mongolia, Panama, Philippines, Chile, Peru, Papua New Guinea, Afghanistan, and the US (Alaska). The information is hype. The consequences of people believing it can be devastating for Intag’s communities, and for one of the world’s most biodiverse forests.

 2.26 million tons of copper, if it even exists, would take about 10 to 15 years to exploit, and would give the world only about 35 days worth of copper (the world consumed about 22 million tons last year). China consumes four times this amount just every year.

 The news article also goes on to say president Correa will either do away with the windfall tax or drastically reduce it in order to appease the world’s mining companies, which had a problem with it. Keep in mind that the windfall tax is being applied to the Petroleum sector, leaving substantial amount of cash for Ecuador. The hypocrisy is hard to overlook. A little while ago Mr. Correa and his followers in power were trumpeting to the world how Ecuador had the best mining law, in that it forced most of the mining profits to stay in the country. Yet, this new measure comes at a time when the rich, poor and middle class in Ecuador are being hit with onerous taxes, including a tax on primary and secondary native forests, which is driving deforestation, as people either sell the land to farmers and ranchers, or turn the most valuable trees into boards to pay for the new taxes.

I am including a slightly updated version of the August 12th post below explaing why Codelco Will Also Fail in Intag.

 Posted on | augustus 12, 2011

I recently had a look at the government’s brand new mining development plan for 20II-20I5. Junin is mentioned several times, not just as having an incredible 40% of the country’s mineral wealth (supposedly 84 billion dollars worth- quite a stretch!!), but also because the government thinks it can start working in Junin in 2012. Where does this leave CODELCO? The world’s largest copper producer (owned by the Chilean Government and its people) is trying very hard to look for copper just west of Junin- in the vicinity of the El Paraiso community. Apparently, the individual who owns the concession, has $omehow managed to get approval the first stage of the Environmental Impact Study. But, bear in mind that CODELCO only does mega mining project- coincidentally, in the world’s driest desert (the Atacama, in northern Chile). They will not consider relatively small projects as might exist in the 800 hectare concession they are playing around in at the moment. It’s pretty clear their sights are set on Junin, and they are likely seeing it as a joint-venture with the Ecuadorian government.

Why do I say Codelco will surely fail in Junin? Let me count the ways:

  • Because they started on the wrong foot: lying to locals, failing to consult in good faith, and trying to buy the support they need with money and promises (Duh!, that’s creative!!)

  • Because they know, or should know, that the overwhelming majority of communities, organizations, and local governments in Intag reject mining as a model of development in (hello in there… two transnationals defeated, and what can you do that they others didn’t?). In a recent national anti-mining assembly, the rejection of Codelco’s presence in Intag was vociferous as it was total. And if that wasn’t enough, in a recent development that should grow a few grey hairs in Chile, the mayor of Cotacachi County, Alberto Andrango, publicly stated (newspaper interview in August of this year) his rejection for mining for the whole County, and that his government will support tourism and agriculture instead.

  • Because they know, or should know, that the area is rich in primary cloud forests that are the home of dozens of species of mammals and birds facing extinction. And because open-pit mining is illegal in Cotacachi County. It was outlawed in 2000 with the passing of the legally-binding Cotacachi Ecological County Ordinance. Plus, they are practically surrounded by and within four protected areas (the Los Cedros, and the Chontal Protected Forests, the Toisan Municipal Protected Area, and the Junin Community Reserve).

  • The copper in Junin, according to the Japanese who explored it, is very deep; deeper than most depostis. What this means is that the impacts will be much greater than in most other mining projects. The deeper the mine, the more they have to dig out to reach the ore body, and the more overburden- or subsoil laced with heavy metals, have to be moved around and disposed of. Plus they have to deal with millions of more gallons of underground water; a nightmare for the companies and the environment. For a relatively small mine that the Japanese did a preliminary Environmental Impact Study, of only 450,000 tons- or one fifth the 2.26 million tons they eventually found- the Study’s scientists said 600 hectares (1500 acres) would be needed just to store just the waste rock from the small mine. Imagine the impacts if they were to prove the existence of the 2.26 million tons. As it is, the Study predicted “massive deforestation, impacts to dozens of mammals and other species thereatened with extinction, drying up of our climate, contaminated rivers with heavy metals, and relocation of four communities; to mention just some of the impacts identified in the Study.

  • Not enough? How about that where they are looking for copper is extraordinarily rich in pre-Incan arqueological vestiges belonging to a people which very, very little is known about? Oh, and by the way, for all practical purposes, mining is illegal in such sites.

  • Because they know, or should know, that the people in Intag will not allow it. During the course of the last 17 years of standing up to transnationals, they’ve learned a few tricks. They made Mitsubishi clear out in 1997, and then Copper Mesa in 2008. In the case of the latter, not only did it have to abandon Intag, but the company lost its concessions, was kicked off the Toronto Stock Exchange, and was sued in Canada. It hasn’t been heard from since.

 Surely the Chilean government (Codelco’s part owner) can think of better things to do with its citizen’s money than to throw away in a mining project that is guaranteed to fail.


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