November 10, 2010 – Argentina – Barrick Exploraciones Argentinas (Barrick’s Argentine affiliate) and Exploraciones Mineras Argentina filed legal action against the government of Argentina seeking to nullify the National Glacier Law, adopted last month, because it places their investments at risk.
Barrick requested a federal circuit court of the Province of San Juan where they operate Veladero an soon Pascua Lama in the heart of glacier country and where the company has already partially or fully destroyed several glaciers, to annul the recently passed glacier bill as it would violate rights they already have acquired to mine gold in Argentina. The problem is that gold and glaciers seem to go hand in hand in the Andes mountains.
The new Argentine Glacier Law not only bans future mining projects near glaciers, but also calls for existing projects like Veladero and Pascua Lama, to go through glacier impact assessments. If found to harm glaciers (Barrick has destroyed glaciers), projects like Pascua Lama and Veladero could be stalled, forced to relocate, or face termination.
Barrick’s complaint points to rights acquired by the company under the mining code established in the mid 1990s to promote mining investments in the country. Barrick also rejects the obligation of the glacier law calling for new environmental impact assessments (EIAs) to determine their impacts on glaciers.
In original EIAs presented by Barrick to Chilean and Argentine authorities, the company failed to mention the presence of several glaciers in project impact zones. The Coconta glacier, for example, was almost fully destroyed to make way for a road to the mining sites. (see GPS point in Google Earth: 29 59 29.54 S, 69 37 18.33 W; copy and paste exactly as is in Google Earth GPS search box).
Barrick had originally proposed to blow up glaciers impeding their access to gold deposits and move them to another site. This plan was dropped when it received strong opposition from stakeholder communities. (See picture below of Barrick’s cartoon depiction of how to blow up a glacier and move it in dump trucks)
The mining friendly tendencies of the 1990s which lowered tariffs and provided endless benefits for largescale mining investments throughout Argentina, have given way to a backlash against liberal tax policies and tax havens for big foreign business.
During the glacier law debate, Congress expressed strongly the need to revamp the mining code, in favor of introducing greater mining benefits for national and provincial coffers, and less for foreign investors. Argentina law levies merely 3% tax on mining and allows for many discounts of expenses, resulting in most profit going abroad. Many mining investments have extremely lucrative horizons in Argentina recuperating full investments in merely a few years, while neighboring countries like Chile have already upped taxes to well over 10%.
The new Glacier Bill appeared following recurring evidence that foreign mining projects from companies like Barrick Gold in provinces like San Juan, Mendoza, Catamarca, La Rioja, and Santa Cruz, are destroying Argentina’s glaciers, either by introducing endless maze-like roads in the high Andes (see GPS: 29 19 10.27 S, 70 1 40.91 W) in the middle of sensitive glaciosystems which affects the formation and natural evolution of glaciers, or by contaminating the atmosphere with massive amounts of particulates from explosions in the mining process, which covers glaciers and lead to accelerated melting.
Dozens of mining ventures face serious threats to their investments from the new glacier law, including projects like Vicuña (Suramina), Batidero (Suramina/TNR/Canadian Gold Hunter/Jogmec), Amos Andres (Xstrata), Los Azules (Xstrata/TNR), Casposo (Troy), Los Helados (Suramina), Northern Proporties (TNR Gold), La Ortiga (South American Minerals), El Pachón (Xstrata). All of these mostly exploratory projects or projects in late permitting stages, are scattered in the heart of Argentina’s richest glaciers region. All of them now have to conduct Glacier Impact Assessments.
A recent article in The Investor (an Argentine mining magazine) headlined that “More than US$15 billion in investments are at risk due to the new glacier law”. (see: El Inversor. No. 50, Sept 2010).
For the moment, it is likely that the legal dispute spawned by the glacier law will entrench, and while projects like Barrick’s Veladero will probably continue until the legal dispute is resolved, others that are in permitting or prospecting phases, will likely stall until the legalities can be sorted out.
For the time being however, the Glacier Law is extremely clear:
Art. 6º – Prohibited Activities
All activities that could affect the natural condition or the functions listed in Article 1, that could imply their destruction or dislocation or interfere with their advance, are prohibited on glaciers, in particular the following:
a) The release, dispersion or deposition of contaminating substances or elements, chemical products or residues of any nature or volume. Included in these restrictions are those that occur in the periglacial environment;
b) The construction of works or infrastructure with the exception of those necessary for scientific research and to prevent risks;
c) Mining and hydrocarbon exploration and exploitation. Included in this restriction are those that take place in the periglacial environment;
d) The installation of industries or the building of works or industrial activity
For more information:
Jorge Daniel Taillant
Coordinator, Glaciers, Mining and Human Rights Program
Center for Human Rights and Environment (CEDHA)
tel. +54 9 351 507 8376