Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Communications

Industry Products

Media Services

Follow Us

Guatemala Says It Has No Evidence That Would Shut Goldcorp Mine

Feb. 14 (Bloomberg) -- Guatemala said it lacks evidence to support allegations of environmental abuses associated with a mine run by Vancouver-based Goldcorp Inc. seven months after a presidential aide said the operation should be shut.

The government, which is still investigating the claims, has found no proof of contamination during quarterly inspections of rivers near the Marlin mine, said Guillermo Scheel, director of mining at the Ministry of Mining and Energy.

“We need proof, so we’re collecting it,” Scheel said in a Feb. 11 telephone interview. “This is a big project, so there is no timeline.”

Marlin had output of 296,100 ounces of gold last year, or about 12 percent of the company’s annual production, according to Jeff Wilhoit, a spokesman for Goldcorp, the world’s second-largest producer of the metal by market value. Fernando Barillas, an adviser to Guatemalan President Alvaro Colom, said in June that production at Marlin would have to be suspended within a month.

A month earlier, the Inter-American Commission on Human Rights, an arm of the Organization of American States, asked Guatemala to close the mine pending an investigation into allegations that mining activities had “harmful” effects on the health of local Mayan people.

The IACHR report also said the affected 18 communities were deprived of their rights because the mining concession was issued without their “prior, complete, free and informed consultation.” Scheel said those allegations should be handled by the Guatemalan judicial system.

Independent Study

The country could face legal claims from Goldcorp should it move to suspend mining without sufficient evidence, Scheel said.

Goldcorp commissioned an independent human-rights study of Marlin’s operations. By October, it had moved to address most of the concerns via measures including the construction of new water systems for several local communities and a health clinic, according to company documents.

Goldcorp has yet to fulfill all the recommendations from the independent consultant, Wilhoit said in an e-mailed reply to questions. For instance, the company hasn’t completed a report by independent doctors determining if exposure to heavy metals played a part in the death of two miners, Wilhoit said.

The company uses a cyanide-leaching process to obtain gold and silver from crushed ore at the site, about 185 miles (300 kilometers) northwest of Guatemala City,.

Scheel said a University of Michigan study last year that found higher amounts of metals including mercury, lead and arsenic in 23 residents near the mine than those who lived about 4 miles away was “not very good” and “generic.”

‘Only a Snapshot’

Susannah Sirkin, deputy director of Boston-based Physicians for Human Rights, who coordinated the University of Michigan research, said in a telephone interview last week from Boston that “more robust studies are needed and that it was very clear from the report that it was only a snapshot.”

Maria-Isabel Rivero, an IACHR spokeswoman, said it was unlikely to refer the case to the Inter-American Court of Human Rights in San Jose, Costa Rica, because Guatemalan officials were still gathering information.

“As long as the commission continues to believe that the state is really taking steps to close it down, the commission is probably going to continue to wait,” Rivero said in a telephone interview last week.

Monthly Meetings

In December, Vice President Jose Rafael Espada initiated monthly meetings involving the government, municipalities and Goldcorp to discuss the issues at the mine, Wilhoit said. He downplayed the threat of closure.

“There’s always a chance, but we feel positive about the processes that have been implemented,” Wilhoit said.

Goldcorp acquired Marlin when it paid $7.6 billion for Canada’s Glamis Gold Ltd. in 2006.

Goldcorp fell 12 cents to C$42.41 on Feb. 11 in Toronto Stock Exchange trading. The shares rose 7.6 percent in the past 12 months.

Barrick Gold Corp., based in Toronto, is the world’s largest gold miner ranked by market capitalization.

To contact the reporters on this story: Colin McClelland in Toronto at cmcclelland1@bloomberg.net; Blake Schmidt in Sao Paulo at bschmidt16@bloomberg.net.

To contact the editor responsible for this story: Simon Casey at scasey@bloomberg.net.

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.