Peru stops multibillion gold mining project after protests


Newmont Corporation, one of the world’s largest gold producers, was forced to suspend its plans for a US$4.8 billion mining project following a decision by Peruvian authorities last August.

The announcement was hailed as a major victory by social movements and activists who for 10 months took part in strikes and demonstrations against the project. Communities of the Cajamarca department, in Northern Peru, were concerned about the impact in the region´s economy, living conditions and the environment.

The main point of contention was the destruction of four lagoons that would have to be dried out as part of the project, to facilitate the task of extracting gold and copper from the subsoil. In turn, Newmont promised to build a number of artificial reservoirs to replace the natural lakes.

Peru is one the richest mineral nations in the world and new announcements of large open pit mines have triggered numerous social conflicts recently. The Conga project was deemed to be the biggest investment of its kind in the country´s history.

The protests against the Conga mine involved thousands of people, including rural workers, indigenous communities, churches, trade unions, students and community organisations. In November, local residents took part in a general strike which closed schools and businesses, blocked motorways and brought public transport to a halt.

In July, police clashes claimed the lives of five demonstrators during a peaceful action and an state of emergency was declared in Cajamarca and other two provinces. The violence led to international condemnation of the Peruvian authorities, including from organisations such as Human Rights Watch and the International Trade Union Confederation.

Speaking to the local media, Roque Benavides, chief executive of Buenaventura, a Conga joint venture partner, regretted that up to 4,500 jobs cannot now be generated with the project suspension. Although he assured that the company would try to avoid any confrontation with the regional and national authorities.

The alleged potential for job creation is put into question by some analysts.

"Mining undertaken throughout the centuries by large corporations in Cajamarca resulted in large masses of poor and unemployed people living in precarious settlements in the nearest towns, under the worst living conditions", said Juan Aste Daffós, a researcher of mineral economics and environmental management from Lima´s National University of Engineering.

According to a survey by Peru´s Ministry of Economy and Finance and the National Institute of Statistics and Informatics (INEI), the Cajamarca region went from fifth to the second poorest region within the last twenty years, when large mining projects escalated in the area.


The same study pointed out that the mining areas are those with the highest percentage of chronic malnutrition in children: Huancavelica (46.4%), Huánuco (31.3%), Cajamarca (29.9%) top the list, whereas the national average is 15% of the child population.