GOLD MINING COMPANY TO MOVE GLACIERS IN ANDES MOUNTAINS

by Stephen Leahy

(IPS) -- Construction on the controversial, billion-dollar Pascua-Lama gold mine project, which will require moving Andean glaciers on the Chile-Argentina border, may begin this year despite strong opposition from environmentalists.

Pascua-Lama is one of the world's largest untapped sources of gold ore, with the potential to produce 17.5 million ounces.

Canada's Barrick Gold Corp. owns the mining concession for Pascua-Lama and for 3,000 square kilometers in the surrounding region. The company, which recently became the world's largest gold producer, plans to begin construction of the $1.5 billion project this year, despite public protest inside and outside of Chile.

"We're hoping to complete the permitting process and proceed with our current timetable," Vincent Borg, vice president of corporate communications at Barrick, told Tierramerica. That timetable means construction would start in September, with production commencing in 2009, according to previous reports.

Barrick has revised its project plan and will need to move only about half the glacier ice originally forecast, Borg said. "The glaciers or ice reservoirs impacted only represent 0.4 percent of the water flowing into the valley."

The spokesman said he had no comment on statements from Chile's President-elect Michelle Bachelet that she intends to protect the glaciers and prohibit their removal or destruction.

"It's just crazy to think those glaciers can be removed and there won't be any impacts," says Jamie Kneen of the Canadian non-governmental group MiningWatch Canada.

"The glaciers have already been damaged by Barrick's exploration roads and test drilling," Kneen told Tierramerica.

The Pascua-Lama site is located 4,600 meters above sea level and extends to both sides of the Argentine-Chilean border, with 80 percent in Chile. The site for the enormous open-pit mine sits under three glaciers known as Toro 1, Toro 2 and Esperanza.

The glaciers feed into Huasco Valley, 660 kilometers north of Santiago, supplying irrigation water for some 70,000 small farmers. Barrick originally planned to dig and blast an estimated 300,000 cubic meters of ice over a 20-hectare surface area from the glaciers. To mitigate ecological impact and prevent ice from melting, the ice would be moved to create a new larger glacier nearby.

The removal of the glaciers "will principally hurt the water supplies of the Huasco Valley in Chile and the Jachal Valley in Argentina," says Raul Montenegro, biologist at the University of Cordoba and director of the Argentine Foundation for Environmental Defense (Fundacion para la Defensa del Ambiente).

According to Montenegro, the environmental harm has been evident in another Barrick project that involved ice removal: Veladero, located south of the Pascua-Lama in Argentina and with an estimated yield of 12.8 million ounces of gold.

Although Pascua-Lama will be 80 percent in Chile, the most serious environmental impact will take place in Argentina, because that is where the mine's waste dump will be built, Montenegro said.

In Argentine territory a smaller portion of the open pit will be dug, along with a waste rock dump, a processing plant, a tailings pond, the construction camp and operation camp for roughly 5,500 people.

At Pascua-Lama, millions of tons of ore will be processed using cyanide solution to recover the gold and metal. The waste ore and water contaminated with cyanide will have to be stored in ponds or behind dams.

Ruptures in holding ponds account for 75 percent of the hundreds of environmental accidents involving gold mines in the past three decades, according to Earthworks, a U.S.-based NGO.

The Pascua-Lama region is also prone to earthquakes and tremors, notes Kneen. "Public opposition to this is huge in Chile, the biggest since the 1973 protests (against dictator Gen. Augusto Pinochet)."

"Most gold mines don't see this level of public opposition," agrees Jason Goulden, director for corporate exploration at Metals Economics Group, a leading worldwide minerals information and consulting company in the eastern Canadian city of Halifax.

While acknowledging that gold mines impact the environment, the removal of glaciers is unusual and clearly a sensitive issue, Goulden told Tierramerica. But the enormous size of the gold reserve and the ability to get the gold out at a low cost means it is likely to be a "very profitable" operation.

Gold prices are currently at 25-year high of $560 an ounce.

Demand for gold is expected to remain high due to economically booming India's thirst for gold jewelry and the expectation that the central banks in China and Russia will move away from buying dollars toward buying gold for their reserves, he says.

"Pascua-Lama is an important project for Barrick because there is lots of money to be made," commented Goulden.