San José, Costa Rica, since 1956

Gold Mines Seek Final Approval

A controversial plan to develop an open-pit gold mine inthe country’s Northern Zone in the face of a national moratoriumon the practice seems to be going ahead as planned,according to the developers and government officials.One of the final steps to obtain approval to start miningis a public meeting scheduled for next week.The proposed Las Crucitas project is being carried outby Industrias Infinito S.A., the Costa Rican subsidiary ofthe Canadian company Vannessa Ventures, and is one oftwo mining companies declared exempt from the 2002moratorium on open-pit mining signed by President AbelPacheco as one of his first acts in office.The other is Río Minerales S.A., a subsidiary of anotherCanadian company, Glencairn, which has a concession to mine for gold near Montes de Oro, about 17kilometers northeast of the Pacific port townof Puntarenas (TT, Jan. 30).THE Las Crucitas mine, which will bebuilt on a concession of 176 square kilometers(68 square miles) in the Northern Zone,just south of the border with Nicaragua inthe Alajuela province, has encounteredapparent political opposition from thePacheco administration, and IndustriasInfinito has fought a lengthy legal battle withthe government to obtain the go-ahead forthe project (TT, June 6, 2003).While Río Minerales has had a governmentconcession to extract gold from itsproperty in Montes de Oro, Puntarenas, forsome time now, Industrias Infinito had itsconcession signed on Jan. 30, 2002, justmonths before the administration of formerPresident Miguel Angel Rodríguez ended(TT, March 14, 2003).Before beginning mining operations,both companies must obtain the approval ofthe National Technical Secretariat of theEnvironment Ministry (SETENA), theHealth Ministry and municipal authorities.Mariano Peinador, head of SETENA’sDepartment of Environmental ImpactStudies, said the agency will likelyannounce a final decision regarding theLas Crucitas project in August, three tofour weeks after the mandatory publicaudience about the mine is held on July 31,at the Coopevega Community Center, from8 a.m. to 4 p.m. The meeting is open to thepublic.THE audience is the final step thecompany must take before Peinador andhis co-workers approve or reject the study,which consists of enough paper to fill anentire bookshelf with thick, black binders.“We’ve read it. We’ve made observations.Now we have to hear what the publichas to say about it,” Peinador said.Industrias Infinito chief Jesús Carvajalsaid the company has gone to extensivemeasures to inform the public about theproject and about the meeting, and that heis not concerned the meeting will becomean obstacle for the progress of the mine.He claims the company has participatedin at least 25 community meetings duringthe past ten years, and has hosted aweekly call-in radio show on Radio SanCarlos (AM 1440) during which communitymembers can ask questions of variousexperts involved in the project.Carvajal said the company hasannounced the upcoming meeting on itsradio show, purchased radio, television andnewspaper ads to run the week before themeeting, and will send a truck with loudspeakersthrough area communities toannounce its time and location.He said company representatives alsosent written invitations to the heads of areaschools and opposition and environmentalgroups.“ALL of the opposition in San Carlosis duly informed,” Carvajal said. “We hopefor the participation of groups in oppositionto this project.”He said Industrias Infinito sees themeeting as “a great civic party.”The vast number of people interestedin the project could serve as an indicator ofits controversial nature. According toSETENA officials, at least 1,500 peoplehave asked to be “apersonado” in the LasCrucitas file, meaning SETENA isrequired to notify each of them by faxevery time the project moves a step closerto final approval (TT, July 2).Blanca Vargas, a schoolteacher in thearea and a member of the Front inOpposition to Mining Projects in theNorthern Zone, said she and other communitymembers are concerned the projectwould destroy the little wildlife thatremains in the area.Vargas said she and other oppositionfront members visited the site of the proposedproject and saw howler monkeys,white-faced capuchins and numerousspecies of parrots.“There used to be a level of flora andfauna that has already disappeared fromour communities because of deforestation,”she said.Vargas said opposition members arealso concerned about potential contaminationof the nearby San Juan River, and thesubsequent impact such contaminationwould have on the Indio-Maíz IndigenousReservation, on the Nicaraguan side of theriver.IN March 2003, SETENA officialsrejected an environmental impact studysubmitted by Industrias Infinito afterreviewing it for more than a year – a movethat nearly halted the project in its tracks.Industrias Infinito immediately appealedthe decision to SETENA officials, whichcompany representatives claimed failed torespond for more than two months.The Constitutional Chamber of theSupreme Court (Sala IV) in June 2003sided with the mining company on thematter, and ordered SETENA to respond tothe appeal within five days. The court alsoordered SETENA to pay damages to thecompany, because the delay caused thecompany’s stock to drop while the price ofgold rose (TT, June 6, 2003).Andrés Soto, a spokesman forIndustrias Infinito, said the governmentgave the company a period of four years totake civil action to claim the damages.However, he said the company probablywould not pursue payment.Carvajal told The Tico Times he is notat all concerned that politics will be a factorduring the final revision of this study,submitted by Industrias Infinito inFebruary of this year.“YES, the government did include politicsin a technical process,” he said. “Butthe government now has it very clear thatthe concession was legally obtained.”“The behavior and form of the SETENAfunctionaries who are currentlyreviewing the study has been nothing butobjective, transparent and professional,”Carvajal said.The current price of gold is $392 perounce, according to the Web site,meaning that at that rate the mine wouldproduce about $34.5 million annually from88,000 ounces of gold the company hopesto extract each year from Las Crucitas.Carvajal said that in addition to theapproximately 150 jobs the mine will generatefor area residents, about 40% of thatrevenue will be dispersed into the outlyingcommunities in the form of agriculture andlivestock development programs, a furnituremanufacturing and export project,reforestation and aquaculture projects, anda biological station in Las Crucitas thatwill be developed with collaboration fromthe University of Costa Rica.HE claims the mine will provide muchneededeconomic stimulation to the impoverishedregion and promised the accompanyingprojects will leave the communitywith a stable economy after the companyextracts some 724,000 ounces of gold overthe course of just more than eight years.No parallel development opportunityexists for these communities, Carvajal said.Perhaps the most controversial aspectof both projects is the proposed use ofcyanide to extract gold from the ore thatcontains it, a standard practice at open-pitgold mines. While Environment MinisterCarlos Rodríguez said the government is“worried about the possibility of contamination,”Río Minerales general managerFranz Ulloa said it would take an “act ofGod” to cause an accident (TT, Jan. 30).Both Ulloa and Soto said the use ofcyanide is essential to separate smallamounts of gold from the ore and topsoilthat contains it.After using the cyanide, both companiesprocess it using a technique calledInco-SO2/Air, which representatives ofboth companies said breaks down the basicchemical structure of cyanide into harmlesselements.Soto said the Health Ministry willmonitor the use of cyanide at the mine.WORK on the Río Minerales concessionin Montes de Oro became a center ofcontroversy early this year when thecompany began initial earth movementoperations at the site without propermunicipal authorization. Montes de OroMayor Álvaro Jiménez said he imposedan $8,500 fine on the company for workingafter he rejected a request for municipalauthorization it submitted inNovember 2003. The company at thattime lacked the approval of the HealthMinistry, but on Jan. 13 presented allnecessary paperwork (TT, Jan. 30).The Montes de Oro mine, which sits ona 1,066-hectare (2,634-acre) concession –100 hectares (247 acres) of which will beused for the project – will generate 241jobs for area residents, Ulloa said.SETENA officials on June 1 issued aresolution on the project, which appears togive it the go-ahead from the agency, butoutlined numerous stipulations.The agency resolved that Río Mineralesmust intensify its efforts to develop betterrisk-management techniques and controlerosion at the project site. The SETENAresolution also stipulates that RíoMinerales not begin building the administrativeoffices or structures necessary toseparate gold from its ore until receivingnecessary approval from the HealthMinistry and municipal authorities.The gold from both mines, accordingto company representatives, will be sent toprocessing plants in the North America orEurope to be purified, as there are nopurification plants in Costa Rica.

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