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Peru mining boom leaves highlanders behind

Peru's carte blanche for big mining leaves highlanders behind, battling contamination

Posted on June 7, 2014 at 12:12 a.m.

SAN ANTONIO DE JUPROG, Peru (AP) — The Marzano-Velasquez clan lived a simple, pastoral life on a mountain that happened to sit atop the world’s largest known copper-and-zinc deposit.

It wouldn’t make them rich. Maria Magdalena Velasquez signed away her family’s share of the windswept moorlands with a thumbprint in 1999. Like dozens of other Quechua-speaking families who sold their land to the international mining consortium, they thought the open-pit Antamina mine would lift their long-neglected highlands district from poverty.

Two decades ago, this rugged, mineral-rich Andean nation bent over backward to attract mining multinationals — and became Latin America’s undisputed economic growth leader as a result. But the boom has been more of a curse for families like the Marzanos, who saw the $49,000 they got for their land quickly evaporate. Promises of jobs, decent schools and health care did not come true.

Instead, the people who live in the rural highlands have been battling one environmental disaster after another. Frustration over lax industry regulation has led to a growing fury of protests in Peru, with at least eight people killed by security forces at two mining projects in 2012. Of 81 active environmental disputes the government counted in April, a half-dozen involved Antamina.

The Marzanos are leading one of the protests, fighting what they consider the mine’s continuing encroachment and unfulfilled promises.

The mine, owned by a consortium comprised of BHP Billiton, Glencore/Xstrata, Mitsubishi and Teck Resources Ltd., netted $1.4 billion in profits in the year ending in June 2013.

Half the 30 percent tax on its profits is distributed in its host state. The district of San Marcos, where the mine is located, is the country’s richest — receiving about $50 million a year in royalties. Yet it has no paved highways, no hospital, and no water treatment plant. Nearly one third of toddlers suffer from chronic malnutrition — double the national average.

Beset by graft, San Marcos has cycled through four mayors in four years. The three ex-mayors were all charged with inflating public works contracts and giving jobs and kickbacks to relatives. The current mayor is under investigation for the same.

Antamina says it spent $314 million from 2007 to 2013 on infrastructure and “social inclusion” projects in the region — including in pre-natal and dental care, child nutrition and animal husbandry.

Asked why San Marcos residents nevertheless live so poorly, company spokesman Martin Calderon suggested such questions be “directed at the authorities, be they national or regional.”

World Bank guidelines stipulate that in big mining projects such as Antamina the people relocated should end up with equal or better living standards. Yet the poverty rate in Peru’s mining-scarred highlands is about 50 percent, double the national average.

Only one of Velasquez’s nine children works at the mine, and all are fighting it. They curse its rock-loosening blasts, which hurl skyward a blood-orange dust that contaminates people, crops and livestock.

“It penetrates your skin, like ashes from a wood fire,” said Lidia Zorilla, a 34-year-old farmer in Juprog as a dust cloud wafted over her.

Antamina official Mirko Chang said the cloud is not toxic. “It’s earth, just the same as anywhere else,” he said.

Villagers say the dust makes them sick.

Tests done from 2006-2009 by government health agencies at villagers’ requests found elevated levels of lead and cadmium in people’s blood and urine.

President Ollanta Humala said in a September interview with The Associated Press that he found the contamination claims against Antamina hard to believe, since it would not make sense for big multinational companies to risk “acting irresponsibly.”

“They would have a lot to lose because Peruvian laws are very strict these days for mining companies that contaminate the environment,” he said.

Many villagers believe a $1.5 billion upgrade Antamina completed in 2012 that its CEO said boosted production by 38 percent just means more pollution. They do not believe its claims that it is compliant with air and water quality standards.

And they have little faith in regulators or authorities.

In 2010, a prosecutor threw out an attempt to initiate criminal proceedings against Antamina based on the health studies.

In fact, no significant lawsuits related to pollution or public health have been successful against big mining in Peru, environmental lawyers say.

In Chile, environmentalists were heartened last year when construction was suspended on an $8.5 billion gold mine over downstream contamination. Mining companies have not faced such regulation in Peru, where the mining ministry approves environmental impact studies.

A fledgling environmental protection agency has flexed some limited muscle. It has fined Antamina a total of $487,200, mostly for a June 2009 leak of copper, zinc and lead into a river. Antamina is appealing that and other fines, to date paying $85,700 of the total assessed.

Peru has more than 7,500 mining waste sites, and mining companies are supposed to pay to clean them up. But a government list almost never identifies the polluter.

Reform from within has proven frustrating.

Ernesto Bustamante, a molecular biologist, was environmental protection chief at the mining ministry for four months in 2011. He had hoped to devise ways of chemically dissolving contaminants. Instead, he discovered a ministry with “little interest in remediation.” Mining company employees routinely sneaked in to help edit environmental impact studies, he said.

Twice, he said he discovered major mining companies had gone ahead with expansion projects without permits.

Many ministry workers were on the take, Bustamante suspected.

“Technicians who made a little more than $1,000 a month were taking vacations in Paris.”

Associated Press writers Franklin Briceno in Lima and Claudia Torrens in New York contributed to this report.





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