Canadian Mining Interests Face Coronavirus Criticism

Restrictions imposed in response to the coronavirus (Covid-19) pandemic may have slowed mining activity in the Andean region, but even these scaled-back operations have faced continued criticism for overlooking concerns about the health of workers, and for using the pandemic to push for a loosening of environmental controls.
peru Canadian Mining Coronavirus

International mining companies came under fire in June from a report entitled ‘Voces desde el Territorio’, of which the NGO MiningWatch Canada was one of several authors. The report identified the Antamina copper and zinc mine in Peru’s north-western Áncash region, where 210 workers have contracted Covid-19 and at least one has died, as a case in point. Peruvian legislators declared a national ‘sanitary emergency’ on 15 March in response to the pandemic, but allowed mining operations to continue, given the sector’s importance to the country’s economy. Yet the Covid-19 outbreak at Antamina - co-owned by Canadian company Teck Resources - has amplified civil society claims that international mining companies are prioritising profit over people.

While attentions are focused on the health emergency, the weakened enforcement of environmental controls has enabled companies to operate with reduced oversight. Canadian companies have become increasingly influential in the Andean countries’ mining sector in recent years, especially in Peru and Ecuador – but this expansion has brought with it a string of controversies over labour rights and environmental protections, with Covid-19 concerns just the latest manifestation of these ongoing issues.

Peru

Canada has become a major investor in Peru since the signing of a free trade agreement (FTA) in 2009, with foreign direct investment totalling US$14bn in 2018, according to the Canadian Embassy in Peru. The majority is channelled into mining; only the United Kingdom and China have larger stakes in the sector. With Peru’s mining exports falling 40% year-on-year in April due to the quarantine controls, the mining firms in the country has been suffering the pandemic.

The gradual resumption of production may have appeased investors, but the situation at Antamina – one of the largest copper and zinc mines in the world– has attracted unwanted attention, amid fears that ramping up activity could compound the alleged breaches of health, safety, and environmental protocols that were overlooked prior to the pandemic. A statement from Teck claimed that the mine suspended operations in April, at which point “a rigorous testing and quarantine programme was put in place to ensure employee and community health was protected”.

At Constancia, a copper mine in the southern Moquegua region, the Peruvian chapter of civil society group Human Rights Without Frontiers alleged in April that Canadian owners Hubday Minerals had ignored 21 Covid-19 positive tests. Hudbay denies this claim. But Kirsten Francescone, MiningWatch Canada’s Latin America coordinator, commented that “Hudbay has a long history of violating the human rights of local populations at its operations in Guatemala and Peru. Their lack of respect at Constancia for communities affected by this global pandemic forms part of a historical pattern of behaviour”.

Ecuador

As in Peru, Ecuador’s mining industries were largely exempted from the quarantine imposed by the government on 16 March. Production was nonetheless affected significantly by the pandemic, with exports from the city of Guayaquil - a major transit hub and Covid-19 hotspot - only recommencing in early July. But Canadian companies have not escaped criticism in Ecuador. Solaris Resources, which owns the Warintza gold project located in the southern Zamora Chinchipe province, brought seven members of the local Shuar community to the Prospectors and Developers Association of Canada (PDAC) mining fair in Toronto in March, just as the extent of the pandemic was becoming clear.

Family members of two of the Shuar delegates died showing Covid-19-like symptoms, shortly after their return from Toronto. At least eight other members of the Shuar community also exhibited symptoms. On 13 April, more than 100 international NGOs wrote to the Ecuadorean government demanding urgent measures to protect the Shuar community from the “irresponsible actions” of Solaris resources; and condemning the decision to take them to the conference in the first place as an attempt to undermine the community’s rejection of mining in their territory.

Relations between Canadian mining firms and Ecuador’s indigenous communities have often been tense. In March 2019 the development of INV Metals’ Loma Larga gold mine in Azuay province, thought to be a threat to nearby water sources, was rejected by local communities through a referendum. However, after a joint appeal by INV and Ecuador’s mining ministry, in February this year the country’s constitutional court ruled against the legitimacy of community referendums, upholding the rights of mining concessionaires.

Some Canadian companies have shown a stronger commitment to responsible mining practices. Continental Gold’s plans to exploit gold reserves at the Buriticá mine in Colombia’s Antioquia department never materialised, as despite acquiring an environmental license in 2016, the company insisted on enforcing the highest possible social and environmental safeguards, carrying out years of consultations with the local community. After reaching an impasse, however, the firm eventually cut its losses, selling to China’s Zijin Mining Group in February.

The arrival of Covid-19 has only enhanced the perception that mining companies are granted preferential treatment by governments in the Andean region, as operations have largely continued in a sector deemed to be essential for economic recovery. If these companies are seen to be capitalising on the crisis, to expedite administrative decisions and weaken measures that protect people and the environment, the sector’s reputation may take a further hit.

Fruta del Norte

The pandemic has affected production at the Fruta del Norte mine, said to contain Ecuador’s largest gold deposit. When extraction at the mine located in Zamora Chinchipe province started in December 2019, Canadian owners Lundin Gold predicted it to produce an average of 325,000 ounces of gold a year. The company’s president, Ron Hochstein, now expects the mine to yield just 220,000 ounces in 2020, with the vast majority (170,000 ounces) coming in the second half of the year, after the mine ceased operations between March and July.

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