Glamis Gold Accused of Violating Indigenous Rights

Glamis Gold, currently in the news inciting investors with its adventures in mergers and acquisitions, apparently has a less friendly side. In addition to its history of creating environmental liabilities in the Nevada, and having failed to overturn Quechan Nation rights in California, it stands accused of violating indigenous rights and peasants' rights in Guatemala and Honduras.

Glamis takes great pains to paint itself as a Canadian company, but its head office is in Reno, Nevada and it is clear that it is only Canadian enough to take advantage of Canadian tax incentives (for details see "Understanding Mining Taxation") and the North American Free Trade Agreement (NAFTA).

On July 21, 2003, Glamis filed a Notice of Intent under Chapter 11 of the North American Free Trade Agreement (NAFTA) that it is bringing a US$50 million claim against the United States for actions taken by the state of California to protect the environment - and indigenous Quechuan communities - from the impacts of open-pit mining. The claim was submitted to arbitration in December, 2003. The company argues that it deserves compensation for the laws' impacts on its mining project in California's Imperial Valley.

Meanwhile, Glamis' Marigold Mine in Nevada has created substantial contaminant plumes under tailings impoundments and waste rock dumps that are not being remediated. The plumes are moving toward the Humboldt River and drinking water supplies, according to Tom Myers of Great Basin Mine Watch.

In Honduras, Glamis' San Martin Mine, which it bought as part of merger with Francisco Gold in 2002, has a history of serious problems with relocation of local farmers and contamination of water supplies.

In Guatemala, serious complaints have been raised regarding the awarding of the mining concession for Glamis' Marlin Project in the south-west of the country without consultation with the affected communities. The International Finance Corporation (IFC), the private sector arm of the World Bank, is providing a $45 million (US) loan to Glamis' Guatemalan subsidiary, Montana Exploradora de Guatemala. The project has attracted criticism from a number of Guatemalan and international organisations both for its probable environmental and social impacts and for the fact that the government broke a number of commitments in awarding the concession without properly consulting the affected Mayan communities. The following open letter was sent to the President of Guatemala to emphasise the gravity of the situation:

November 2004

Lic. Oscar Berger, President of the Republic of Guatemala

Dear Mr President,

We write to you as friends of the Guatemalan people. We wish to express our support for the members of the "Frente por la Vida" Coalition[1] who have informed us about the arrival of a mining company, Montana Exploradora, a subsidiary of Glamis Gold and the start of the Marlin gold and silver mining project in the Department of San Marcos (municipalities of San Miguel Ixtahuacán and Sipacapa). We understand that the Government of Guatemala issued a permit for this open pit mine, without the prior and informed consent of the Mam and Sipacapense indigenous people who live in those municipalities.

The Frente has asked the international community for support in their demand that the Government of Guatemala fulfill its obligations according to Convention 169 of the International Labour Organization (ILO), which it has signed and ratified. Convention 169 states that Indigenous Peoples "have the right to decide their own priorities for the process of development as it affects the lands they occupy or otherwise use". It also says that "they shall participate in the formulation, implementation and evaluation of plans and programmes for national and regional development which may affect them directly."

Based on the rights accorded to them by Convention 169, the Frente por la Vida coalition asks that your government:

1. Halt further work on the Marlin mine pending the full and informed participation of local communities in the formulation, implementation and evaluation of the plans and programmes for this open pit gold mine.

2. Change the Mining Law to include a prior and informed consent from the affected indigenous communities for any mining exploration and exploitation permit. The Mining Law should also ban the use of cyanide, which has been prohibited in the state of Montana in the USA. In addition, the royalties should be increased to at least 12% and designated for investments in the affected communities.

3. Declare a moratorium on new mining permits until the Mining Law has been made congruent with all Guatemalan international commitments, especially Convention 169 of the ILO.

We believe that the Frente has legitimate reason to be concerned about open pit mining given the experience of people in other countries around the world.

· The process will use as much as 250,000 litres of water per hour (according to the company's estimates) in a zone with limited water resources.

· Open pit mining is highly destructive of the environment, with contamination of the water with heavy metals, which has negative repercussions for the health of the people and animals, and contamination of the fruits and vegetables being irrigated, both in the immediate area and in communities downstream.

· It is almost inevitable that the cyanide used to leach the gold from the ore will leak into the environment.

· Metal mining in developing countries creates conflict, encourages corruption, and often leads to violence.

· The number of jobs directly related to mining do not compensate for the loss of agricultural jobs and the environmental, cultural and, especially, social deterioration that affect communities where there are mining projects.

A recent study has shown the presence of arsenic above the accepted limits in a similar mine in Honduras. Moreover, mining companies rarely budget enough for clean up and restoration after the mine is finished. This has been observed in developing countries as well as industrialized ones like Canada.

We understand that the Government of Guatemala's intention to attract mining companies is, among other things, to improve the economic situation of the poor. Unfortunately, this does not happen. According to the UN Conference on Trade and Development, poverty has deepened in mining-dependent countries in the last couple of decades. Not many jobs are created and they are short term, as in the case of the San Marcos project, where the company forecasts only a 10-year long activity, after which the indigenous communities will be left with the destruction and contamination of their environment.

Mr. President, we respect your commitment to "work, in a decisive and transparent way, for the benefit of all Guatemalans".[2] We therefore request your immediate intervention. We, members of the international community, support the demands of the "Frente por la Vida" and will continue to monitor the developments of this case of a flagrant violation of indigenous rights.

Signing organizations:
The Social Justice Committee (Montréal, Canada)
Desarrollo y Paz/Développement et Paix/Development & Peace (Canada)
Canadian Auto Workers (CAW)
Guatemala News and Information Bureau (Berkeley, USA)
Network In Solidarity with the People of Guatemala (NISGUA)(Washington DC, USA)
Agricultural Missions, Inc. (USA)
USWA Canada - United Steelworkers Humanity Fund
Maritimes-Guatemala "Breaking the Silence" Network (Canada)
Rights Action (Canada)
MiningWatch Canada

[1] Dialogue space of civil society organizations concerned by the effects of open pit mining and committed to development from the communities.
[2] web page visited on 17 September 2004.