Goldcorp president defends mining practices

Goldcorp president defends mining practices

By Gordon Hamilton, Vancouver Sun May 18, 2011
Goldcorp CEO  Chuck Jeannes

Goldcorp CEO Chuck Jeannes

Photograph by: Ian Smith, Vancouver Sun Files, Vancouver Sun

Goldcorp president Chuck Jeannes defended his company’s mining practices at its Marlin mine in Guatemala, at Goldcorp’s annual general meeting Wednesday, saying it is applying the same environmental and human rights standards as it does in mines in Canada and the United States.

He said the dispute over land ownership and environmental impacts of the mine boils down to a difference of vision between those who feel mining should not be a part of economic development and those, like Goldcorp, who do. He rejected allegations made by activists in Vancouver for the AGM that the mine is causing health problems with indigenous people.

“We are not relying on tests by the Guatemalan government to reach our conclusions that our activities are not resulting in the release of any harmful substances from the mine. We are relying on our own tests. That’s something that we do every day as part of our ongoing monitoring of our activities. It’s the same thing we do in Canada, the U.S. and any place else we operate mines,” he said.

“If it were the fact that there is some negative impact to human health or the environment as a result of our operations, we will absolutely take responsibility for that.”

The Marlin mine was front-and-centre at the AGM at the Pan Pacific Hotel attended by about 150 people, despite otherwise positive reports on the company’s performance and its economic outlook.

Jeannes said the company is managing its portfolio of mines to upgrade the quality of the asset mix. It’s a growth company, he said, but in a later interview clarified that Goldcorp’s days of acquisitions that transform the company are over. He said any new acquisitions would be “bolt on” meaning new projects could easily be integrated into the company’s current structure.

The Marlin mine was raised through a shareholder-initiated resolution calling on the company to halt all land acquisitions and expansion projects at the Guatemalan mine and to suspend operations there in accordance with a recommendation from the Inter-American Commission on Human Rights, an agency of the Organization of American States. The recommendation is not legally enforceable.

The issues at Marlin revolve around concerns that groundwater is being affected by the mine and a 10-year-old land acquisition program where individuals were compensated for land that indigenous communities later declared was communally-owned.

The shareholder resolution was defeated, but its presence on the agenda ensured that it would dominate discussion at the meeting. Outside, 100 protesters chanted their opposition to the company, saying the costs to local communities far outweigh the benefits.

Inside, Kristen Genovese, a lawyer at the Washington, D.C.-based Centre for International Environmental Law, spoke in favour of the proposal, saying the Inter-American Human Rights Commission based its ruling on allegations that Goldcorp’s land acquisition program was flawed and studies showing elevated levels of arsenic and lead in groundwater and that consent was not obtained. The commission recommended the Guatemalan government shut down the mine until the issues are resolved.

It was a “who do you believe” issue, she said, and shareholders should vote to support the findings of the commission.

Guatemalan lawyer Benito Morales, criticized Goldcorp’s land acquisition program, which, he said was conducted under Guatemala’s “failed justice system.”

Jeannes countered that Goldcorp has done human rights impact assessments, conducted extensive monitoring of discharges from the mine and been a leader in the industry is openness and transparency, publishing all its findings. One ethical investment fund, NEI Investments, supported the company, saying the fund is confident Goldcorp is respecting human rights.

Jeannes cited government and independent studies commissioned by Goldcorp that showed there had been no increase in contaminants in groundwater above naturally-existing levels since the mine opened. Further, he said the gold company has offered to meet with its detractors to resolve issues but has been rebuffed.

“The more people are not willing to do that (engage in dialogue) we will be back next year talking about the same thing,” he said.

In a later interview, Jeannes said: “The No. 1 and most important factor is that we are operating the mine to international standards from the very beginning. We conduct regular scientific monitoring at Marlin just like we do at mines throughout Canada and the U.S. We know we are no releasing any harmful elements into the environment.

“This is not a very complicated business. We take rock out of the ground, we crush it and put it through a mill,” he said. “There’s an element that goes into an engineered storage facility. We have discharges from that facility. They are controlled, the water is treated. Government and third parties and ourselves are all there to test the water. And it’s always been found to meet international standards.”

On the land issue, he said: “Individuals who say they own the land and who were confirmed to own the land through the legal process were paid by us for the land.

“We bought the land and paid them just like we would buy the land here. Some individuals in the community were getting significant amounts of money for the sale of their land and others who didn’t have land weren’t. There’s a group that has now argued that this wasn’t really individually-owned land; it was communally-owned, and these individuals couldn’t properly sell it to us.

“Once we heard that, we said ‘Okay.’ We stopped and let the legal process go forward until someone tells us whether we are dealing with individually-owned land or communally-owned land. We can’t make that determination. The communities and the legal institutions in Guatemala have to do that.”

Goldcorp is still making land acquisitions around the mine but only where the legality of ownership is not an issue.

In other business, Goldcorp chairman and founder Ian Telfer said he is “bullish” on the price of gold, forecasting it could hit $2,000 an ounce by the end of the year, based on challenges gold companies are facing in finding and producing new gold.

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