Largest US gold producer may return to Cerro Quilish

Published by MAC on 2011-05-02
Source: Oxfam America, EARTHWORKS

NGOs call on Newmont to abandon mining plan in Perú

Newmont Urged to Drop Plans for Gold Mine in Cerro Quilish, Peru

Revival of Once-Abandoned Project is 'Untenable,' Say Enviro, Human Rights Groups

http://www.earthworksaction.org/PR_NewmontAGM-2011.cfm

19 April 2011

WASHINGTON, DC -- As Newmont Mining Corp. holds its annual general meeting today, environmental and human rights groups are demanding the company drop plans for a gold mine gold mine at Cerro Quilish, where strong community opposition blocked previous plans seven years ago.

"Developing Cerro Quilish is an untenable proposal, both in terms of the financial risks represented as well as the damage to Newmont's reputation and social license", said a letter to Newmont President and CEO Richard T. O'Brien from EARTHWORKS and Oxfam America.

Cerro Quilish has spiritual significance for the region's indigenous people and sits atop the water supply for the city of Cajamarca. In 2004 thousands of Cajamarcans staged protests, clashing with police and blocking access to the proposed mine site for two weeks. The company later acknowledged that community concerns had not been adequately heeded, and in 2009 adopted a "commitment to the principle of free, prior and informed consent".

But in a call with investors earlier this month, Newmont said it was again planning to mine at Cerro Quilish, would be operational by 2016. The site is estimated to hold about 4 million ounces of gold, worth almost $6 billion at current prices. Newmont owns about 51 percent of the project; Compania de Minhas Buenaventura of Lima owns about 44 percent, with the remainder held by the World Bank's International Finance Corp.

In the letter to O'Brien, EARTHWORKS and Oxfam America said the decision to revive the Cerro Quilish mine was "surprising and alarming" in light of "the considerable opposition of local communities to the project, the spiritual significance of the Cerro Quilish mountain to the region's residents, and the projected impacts to the critical watershed".

"We call on your company to . . . [establish] a concrete timeline to resolve community concerns at existing and proposed operations, greater accountability to communities, and an ongoing advisory and oversight mechanism", said the letter. "We urge Newmont to adopt a free, prior and informed consent policy, thereby enhancing your company's reputation as a true industry leader in the area of social and environmental responsibility".

Cero Quilish is four miles from Newmont's Yanococha mine, the largest gold mine in South America and second-largest in the world. The area has been marked by toxic contamination, including a 335-pound mercury spill that harmed more than 1,000 residents, and by violence and intimidation toward mining activists.

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Oxfam America - EARTHWORKS joint letter to Newmont re Cerro Quilish

By Ray Offenheiser and Jennifer Krill

19 April 2011

Richard T. O'Brien
President and CEO
Newmont Mining Corporation
6363 South Fiddler's Green Circle Greenwood Village, CO 80111

Dear Mr. O'Brien,

We are writing to express our concern about recent statements and actions by Newmont Mining Corporation to develop gold mining operations at Cerro Quilish in Peru. This decision is surprising and alarming to us, given the considerable opposition of local communities to the project, the spiritual significance of the Cerro Quilish mountain to the region's residents, and the projected impacts to the critical watershed.

In 2004, Newmont suspended plans to develop Cerro Quilish after many months of sustained opposition from communities in the region. This decision was commended by Peruvian and international civil society groups as well as by investors, who noted the sizable financial losses your company faced as a result of the lengthy conflict.

In your Now and Beyond report published in 2005, Newmont recognized that community concerns regarding Cerro Quilish had not been adequately heeded. Following a 2007 shareholder resolution, your company undertook a review of community relationships (CRR) at active mine sites, with a final report published in 2009. In the final report, Newmont stated a welcome commitment to the principle of free, prior and informed consent.

We urge Newmont to heed community concerns and the recommendations of its consultants and staff by immediately suspending plans to develop Cerro Quilish. We call on your company to implement the recommendations of the CRR and the Advisory Panel by establishing a concrete timeline to resolve community concerns at existing and proposed operations, greater accountability to communities, and an ongoing advisory and oversight mechanism, among other items. Finally, we urge Newmont to adopt a free, prior and informed consent policy, thereby enhancing your company's reputation as a true industry leader in the area of social and environmental responsibility.

Developing Cerro Quilish is an untenable proposal, both in terms of the financial risks represented as well as the damage to Newmont's reputation and social license. We urge your company to immediately cease all activities related to mining this mountain, which communities believe to be sacred and a critical water source, and to instead play a leadership role in the industry through a precedent-setting policy on community consent.

We would be happy to meet with you to discuss these concerns. Thank you.

Sincerely,
Ray Offenheiser President Oxfam America
Jennifer Krill Executive Director EARTHWORKS