Peru’s Conga Mine: A chance to get it right, or business as usual?January 30th, 2012 | by Keith Slack
Last week, the Peruvian government announced it had selected “independent experts” to review the environmental impact assessment of the massive Mina Conga mining project in the country’s northern Cajamarca province. The project has become the latest in a series of battlegrounds over the extraction of natural resources in the country. Local agricultural communities are intensely concerned about the potential negative impact of mining-related pollution on their water sources. Peru’s president Ollanta Humala hopes that this review can help prevent these tensions from degenerating into a bloodbath like the one that took place in Bagua in June 2009, in which 33 people were killed and at least 200 injured.
The intention to bring in independent experts is laudable. Peru’s Environmental Impact Assessment (EIA) review process is notoriously nonindependent; the Ministry of Energy and Mines, which is responsible for promoting mining in the country, retains final say over these critical documents. This is a direct conflict of interest. The government has been under pressure for years from the World Bank and civil society to change this situation, but so far has not done so. When the Ministry of the Environment was created a few years ago, the authority to approve mining EIAs was explicitly left out of its mandate in response to pressure from the mining industry.
Whether the Conga review will be legitimately independent and adequately respond to the concerns of potentially impacted communities, and whether the government will act on its recommendations, is an open question. Initial signs are not encouraging. Last week, Peru’s prime minister stated that if the project did not go forward (which, in theory, could be a recommendation of the review), Peru would be forced to “indemnify enormously” the project sponsor Minera Yanacocha (a joint venture between US-based Newmont and Peruvian miner Buenaventura.) This is an allusion to the possibility that Newmont could bring a case against the Peruvian government under the US-Peru Free Trade Agreement (FTA), which allows American companies to sue the government if it believes it is being treated unfairly. Newmont’s fellow American company, Doe Run, has filed such a case against the government, claiming $800 million in damages for the government’s alleged unfair treatment of the company.
The review process also lacks buy-in from local communities and Cajamarca’s regional government, which has said that it wasn’t adequately consulted in designing the process and won’t accept the results.
Breaking the cycle of conflict
It will be truly unfortunate if the Conga EIA review ends up as nothing more than an elaborate greenwashing exercise. Truly independent and reliable project reviews, carried out with the support and participation of local groups as well as the establishment of effective independent oversight panels could be a key part of finding a way out of Peru’s resource-related conflicts, of which the government currently totals 125 across the country.
Competent reviewers, working with and enjoying the trust of affected communities, could point out serious deficiencies in the government’s oversight and open the door to discussions about the best long-term solution: land-use zoning. Land-use zoning means establishing clearly demarcated areas where mining and other extractive activity can take place, and those in which, for environmental, social, or economic reasons, mining is simply not a viable option.
This question of zoning (or “ordenamiento territorial” as it’s called in Spanish) has been recently analyzed by Oxfam partners Cooperaccion and Fedepaz. The municipal government of Cajamarca has also presented zoning proposals that would protect substantial areas of the province. In theory, zoning can help avoid conflicts in the first place by setting aside areas where mining development is likely to be problematic. This isn’t a “slippery slope” towards banning mining; it’s simply a recognition that some areas simply aren’t appropriate for it.
Unfortunately, at the moment, the Humala administration doesn’t appear to be prioritizing zoning as a means to resolving resource conflicts. We will know shortly whether the current Peruvian government is truly committed to finding sustainable solutions to the conflict at Mina Conga. How they handle this project will likely determine their strategy for handling future extractive industry conflicts.