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News Release

Petaquilla: Panamanian Rainforest, Communities Threatened by Mining

2006 protests: “Violence and death stalk Petaquilla”. The banner reads in part “Petaquilla Mountain: Bread today, contamination and death tomorrow.” (photo courtesy Hector Endara Hill)A remote area of Panama’s rainforest is threatened by open-pit copper and gold mining. Canadian mining companies have already started building roads and bulldozing trees in an area known as Petaquilla Mountain in the Donoso district of the north-central province of Colón. Their plans include not only a series of open pit mines and all the related infrastructure, but a transportation corridor to the Caribbean coast and port facilities in one of the remaining parts of the coast that does not have commercial access.

The 13,600 hectare mining concession is in the heart of the Mesoamerican Biological Corridor, an area of massive biodiversity and stunning beauty stretching from Mexico to the Darién in Panama – a twenty-million-hectare chain of rain and cloud forests, coastal mangroves, and mountain ranges, encompassing forty percent of the combined national territories. The World Bank has provided substantial support to preserving the Corridor. The Petaquilla area is the only forested link between the Darién and the rest of the Corridor.

The Molejón mine site, part of the Petaquilla complex, showing the deforestation and erosion on the site. The company claims to have remediated the site but has provided no public evidence.The consequences of the mining activity are already being felt by neighbouring communities, who have reported extensive deforestation and sedimentation and pollution in rivers downstream. Panama’s National Environmental Authority (ANAM) has found that the mine’s 160 hectare site is seriously to extremely degraded in every environmental measure except air quality, and on November 13, 2008, the prosecution of the Judicial Circuit of Colón announced it would open proceedings against one of the companies, Petaquilla Minerals, for crimes against the environment, based on that report.

Local people protest Petaquilla – Coclesito, Panama (Photo courtesy ANCON)On November 21, 2008, the Panamanian government announced it was fining Petaquilla Minerals $1,934,694 – $1 million for violating the law and the balance for environmental damages – and ordered the company to cease operations until its environmental assessment was approved. Less than a week later, on November 26, it approved the hugely deficient environmental impact study (EIS) for the mine. The approval is conditional on the company completing four more related EISs, as well as fulfilling some 40 related requirements, such as signing on to the International Cyanide Management Code, and posting an additional $14 million in bonds and guarantees.

The Petaquilla mining concession has been controversial since it was initially granted in 1997, by a special law giving the mining companies specific conditions and exemptions from Panamanian law. Some local people have supported it in the hopes of gaining some benefits, but many have opposed it as environmentally, economically, and socially disruptive. On November 12, 2007, ten leading Panamanian environmental groups appealed to President Martin Torrijos for a moratorium on open pit mining. A year later President Torrijos has yet to respond, but in the meantime these groups have been joined by others. On September 6, 2008, communities and environmental and human rights groups formed the Panamanian Network Against Mining, calling for an end to all open pit mining in Panama, and on October 14, 2008, the International Union for the Conservation of Nature (IUCN) passed a resolution asking Central American governments to cancel all mineral exploration and open pit metal mining activities, including Petaquilla.

The Petaquilla concession itself belongs to a Panamanian company, Minera Petaquilla, S.A. but it is being developed as two projects, an open-pit gold mine called Molejón belonging to a Vancouver-based “junior”, Petaquilla Minerals, and a huge open pit copper mine belonging to a major Canadian mining company, Inmet Mining. Panamanian organisations, notably the Centre for Environmental Advocacy (CIAM), have been trying to force authorities there to perform their legal duties with respect to environmental protection, but construction of the gold mine has been rushed forward regardless. The copper mine is still in the early development stage, and with estimated capital costs of at least $3.3 billion it may never see the light of day. More details can be found on our web site.

Panamanian organisations are asking for international support to stop the irresponsible development at Petaquilla, and to make sure that Panama remains free of large scale mining at least as long as it does not have adequate legal and institutional protection for its environment and its indigenous and peasant communities.

We can do this by:

  1. writing to President Torrijos to respectfully ask that he respond to the open letter;
  2. pressuring the companies to disclose the true situation to their shareholders, including Canadians covered by the Canada Pension Plan, which owns shares in both of them;
  3. writing to the Canadian government and the Canadian embassy in Panama to ask them to refrain from supporting these companies in any way; and
  4. letting more people know so they can do the same.