Impoverishment, not development, could be end result of Goldcorp’s Marlin Mine in Guatemala, says new study

FOR IMMEDIATE RELEASE

November 3, 2011

 

CONTACT: 

Jennifer Moore, MiningWatch Canada, jen(@)miningwatch.ca

Amanda Kistler, Center for International Environmental Law, amanda.camigua(@)gmail.com

Impoverishment, not development, could be end result of Goldcorp’s Marlin Mine in Guatemala, says new study

Washington, D.C. and Ottawa – The legacy of Goldcorp’s Marlin mine in Guatemala “could well be ecological devastation and impoverishment” finds a new study from Tufts University’s Global Development and Environment Institute (GDAE). When the long-term environmental risks of the open-pit gold and silver mine are put in the balance with economic gains, the institute finds the benefits to be “meager and short-lived,” especially for local communities.

Goldcorp promotes itself as a low-cost gold producer and the Marlin mine is its lowest cost project and third biggest source of revenues, bringing in roughly $1.4 billion USD since 2006. This is, in part, due to the small share of the revenue that Goldcorp contributes to the Guatemalan economy, owing to a weak royalty and tax regime.  Royalties in Guatemala have been at their lowest ever since mining code reforms in 1996, or 1%, divided equally between national and local governments. Tufts was also unable to find evidence that short-term revenues to Guatemalan authorities are being reinvested for the long term.  Furthermore, Goldcorp’s own social investment at the mine, according to the report, has stagnated.

Additionally, while the bulk of the benefits leave the communities, 100% of the environmental risk is left behind, and those risks “are exacerbated and likely to rise over time.” The report identifies numerous reasons for this, including lack of adequate environmental regulation and oversight, absence of an adequate mine closure plan, and failure to account for projected climate change impacts. Additionally, the study reports a lack of financial assurance for post-closure remediation and monitoring. Goldcorp has posted a surety bond for mine closure at only $1 million USD, while closure costs have been estimated at around $49 million.

“Goldcorp has defended its controversial operations at Marlin by arguing that the mine brings development to Guatemala, but this study confirms what local opponents have been warning,” says Amanda Kistler, from the Center for International Environmental Law. “Goldcorp is making windfall profits from Marlin, and will ultimately leave local indigenous communities to foot a massive clean-up bill. The communities should decide for themselves whether to accept that deal.”

“The company continues to say everything is okay simply because the Guatemalan government says so, but this report reiterates that Guatemalan authorities currently lack the capacity to properly monitor the mine,” says Jen Moore, Latin America Program coordinator for MiningWatch Canada. “The mounting evidence about actual and potential impacts needs to be taken into consideration.”

The report recommends that Goldcorp and the Guatemalan government agree to suspend operations at the Marlin mine as per the order of the Inter-American Commission on Human Rights, and until local consent is obtained, the government undertakes further studies with additional support, local institutions are strengthened and a better revenue-sharing agreement can be reached. The study also calls for suspension of the company’s exploration project, Cerro Blanco.

A copy of the Tufts report “Searching for Gold in the Highlands of Guatemala: Economic Benefits and Environmental Risks of the Marlin Mine” can be found here.

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Center for International Environmental Law (CIEL) is committed to strengthening and using international law and institutions to protect the environment, promote human health, and ensure a just and sustainable society. CIEL is a non-profit organization dedicated to advocacy in the global public interest, including through legal counsel, policy research, analysis, education, training and capacity building.

MiningWatch Canada  is a pan-Canadian initiative supported by environmental, social justice, Aboriginal and labour organizations from across the country. It addresses the urgent need for a coordinated public interest response to the threats to public health, water and air quality, fish and wildlife habitat and community interests posed by irresponsible mineral policies and practices in Canada and around the world.

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