Barrick strikes back

After several weeks of testimony before the Canadian parliament over allegations Canadian extraction companies behave badly abroad, mining representatives had their turn to fire back last week.  Among the speakers was Barrick’s Vincent Borg, Executive Vice President, Corporate Communications, who denied allegations of misconduct.  He further alleged the proposed legislation could hurt the industry’s ability to remain competitive abroad and lead to a mining HQ exodus out of the country.

The testimony comes as Canadian lawmakers consider Bill C-300 (An Act Respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries), which would set Corporate Responsibility Standards (CRS) for that country’s gold, gas, and oil companies working overseas.

HISTORICAL SNAPSHOT:  The bill has been years in the making as Canada has long been the target of accusations involving human-rights and environmental abuses in third-world countries.  A 2005 report issued by Parliament’s Standing Committee on Foreign Affairs and International Trade recommended the country develop standards for Canadian companies working overseas (“Mining in Developing Countries – Corporate Social Responsibility”).

In 2007  a steering committee made up of governmental officials participated in four national roundtable CSR discussions.  The roundtables included governmental officials and civilians from academia, industry, labor and CSR participants.

Bill C-300 was a result of the roundtables and contains some of the recommendations from the discussions.  The bill would develop CSR standards for extraction companies working abroad and investigate allegations of human rights and environmental abuses.  If the abuses are determined to be factual, the company could lose any funds provided by the government (example:  Export Development of Canada (EDC) funds).

However, because the bill was introduced by what is known as a private member, it cannot provide for the expenditure of public funds.  A private member is a member of the House of Commons but is not a cabinet minister.  Very few bills introduced by private members actually become law.

MINING’S TURN:  Members of the committee heard testimony from those who allege mining corporations were responsible for polluting the environment, bribing public officials, and violent acts against the indigenous population of their host countries.  The allegations were broad and included multiple Canadian mining companies.

Borg both testified at the hearings and issued a public statement where Barrick was joined by Goldcorp Inc. and Kinross Gold Corporation in denying the accusations.  Barrick has issued a position statement on the bill featured below in its entirety.

In the position statement, Barrick called the allegations “unsubstantiated” and accuses the committee of playing politics.

“The proper forum for redress and resolution are courts of law or responsible sovereign authorities where matters can be properly investigated on a timely basis – not political arenas,” Borg noted.

Although Barrick operates a large mine in northern Nevada, the accusations stem from actions in third-world or developing nations and not specifically the US.

Supporters of the bill note in many of the countries where Canadian mining companies operate there are weak central governments and sometimes no organized governments.  The mining companies have also complained that when they move in the government moves out – leaving the company responsible for roads, schools, and the populace.

PAPUA NEW GUINEA:  While there have been many allegations against Canadian mining companies, the primary complaints against Barrick come from their operation in Papua New Guinea.  The government there heard allegations from members of the populace that armed security guards working for the corporation were involved in the rape and murder of local citizens – allegations the mine strongly denied at last week’s hearing.

There were also allegations of environmental abuses to the land and water.  When the environmental issues in Papua New Guinea became public, officials from Norway’s Government Pension Fund disposed of their Barrick shares on the recommendation of their Council of Ethics in order to avoid participating in environmental damage on such a large scale.  The announcement came from a representative of the Norwegian government earlier this year.

However, it should be noted mining existed in the area long before Barrick acquired the property in 2006.  In fact, a study conducted by the Australian government that raised environmental concerns commenced before Barrick owned the property at all.

Barrick’s response to these allegations is featured below in their entirety.

DOING BUSINESS:  In their response to Bill C-300, Barrick notes the legislation will negatively effect the company’s ability to do business in Canada and may lead extraction companies to move their headquarters out of the country.  The company’s position statement on Bill C-300, as well as their response to allegations of misconduct, are listed below in their entirety.

 

Barrick Gold Sets Out Position on Bill C-300 and Provides Facts

Barrick Gold Corporation (NYSE:ABX)(TSX:ABX) today outlined its position on a private members’ Bill (C-300) currently before the Standing Committee on Foreign Affairs and International Development, Canada, in particular, that the Bill is unnecessary and damaging to Canadian business. Barrick also set forth facts respecting unsubstantiated allegations that have been paraded by individuals before the Committee.

In a joint submission with Goldcorp Inc. and Kinross Gold Corporation, the companies indicated that Bill C-300 would adversely affect the Canadian mining industry in five key ways:

  1. Risk the competitive position of Canadian companies;
  2. Result in the reputational damage to Canadian companies;
  3. Undermine the multi-stakeholder and collaborative approach to Corporate Social Responsibility (CSR);
  4. Create incentive for companies to relocate; and
  5. Ignore existing regulatory frameworks for CSR.

“We are today providing committee members with detailed, fact-based responses to the various allegations in order to set the record straight. Scrutiny and even criticism are part of doing business, but must be fair and factual,” saidVincent Borg , Executive Vice President, Corporate Communications. “One thing has become crystal clear as the hearings have progressed: some individuals have not been made to substantiate even their wildest allegations about the Canadian mining industry and Barrick Gold – much of which has been thoroughly disproved well before today. They have not provided the Committee with facts or evidence to support their claims as they conduct these hit-and-run company character assassinations.”

“The hearings have amply demonstrated how Bill C-300 has become a magnet for false and unsubstantiated allegations from individuals anywhere in the world and do nothing but unduly harm the Canadian mining industry,” added Mr. Borg.

In every sovereign country in which Barrick operates, there are existing governmental institutions, regulatory regimes, policing authorities, legal procedures and courts. Barrick believes that such allegations should be properly raised in these countries with all of the relevant factual details rather than a parliamentary committee in Canadawhich has not provided any scrutiny or accountability. Beyond such sovereign states, companies are already accountable to a range of international standards and guidelines with respect to responsible behavior.

“The proper forum for redress and resolution are courts of law or responsible sovereign authorities where matters can be properly investigated on a timely basis – not political arenas,” added Mr. Borg.

Barrick Gold Corporation’s vision is to become the world’s best gold company by finding, acquiring, developing and producing quality reserves in a safe, profitable and socially responsible manner.

The Facts About Barrick Gold Corporation

At Barrick Gold Corporation, we value our reputation as a responsible mining company that invests in communities and operates to high ethical, safety and environmental standards. Over the course of consideration of Bill C-300,An Act Respecting Corporate Accountability for the Activities of Mining, Oil or Gas in Developing Countries, Members of the Standing Committee on Foreign Affairs and International Development have heard submissions from numerous government and non-governmental organizations (NGOs), as well as interested groups and individuals.

We believe that public engagement and informed, constructive criticism can benefit our industry. We regret, however, that some submissions to the Committee concerning Bill C-300 have included misleading, erroneous and malicious allegations related to Barrick’s operations and corporate conduct.

In every sovereign country where Barrick operates, our operations and activities are subject to extensive laws, regulations, permit conditions and related enforcement mechanisms. In addition, the company is accountable to a range of international standards, rules and guidelines.

It is our responsibility to set the record straight. We believe a number of the false claims made in connection to Barrick’s operations are part of a deliberate campaign to tarnish the reputation of the Canadian mining industry and Barrick as leaders in corporate social responsibility.

BACKGROUND ABOUT BARRICK

Barrick is a Canadian-based gold mining company and industry leader, with a portfolioof 26 operating mines and projects on five continents. Barrick trades on the Toronto and New York Stock Exchanges and employs over 20,000 people worldwide.

The company is ranked as a world leader in social and environmental responsibility by the Dow Jones Sustainability Index, one of the world’s foremost indices of corporate responsibility. Barrick reports openly and transparently on environmental management, human rights, and other areas in accordance with the Global Reporting Initiative, the international standard for sustainability reporting. The company is a signatory to the United Nations Global Compact and was the first Canadian mining company to sign on to the Extractive Industries Transparency Initiative. As a member of the International Council on Mining and Metals (ICMM), Barrick has aligned its sustainability polices to the ICMM’s 10 Sustainable Development Principles. The company is also a member of Global Business Coalition on HIV/AIDS, Tuberculosis and Malaria and Business for Social Responsibility.

We make it a priority to maximize the economic benefits of our operations locally, which is especially important in developing regions. In Tanzania, Papua New Guinea, Peru and other developing countries where nine of our mines are located, we reach out to local communities, non-governmental organizations and stakeholders and have been successful in earning their support for our operations. Sovereign governments in these countries welcome Barrick as a valued and trusted partner in the development of their country’s natural resources. In developing countries where large segments of the population earn less than a dollar a day, Barrick provides direct employment to nearly 10,000 people and paid out $365 million in wages in 2008. In these countries, the company invested $17 million on programs to improve quality of life and promote sustainable development last year alone, including $9 million on vital community infrastructure such as schools, roads, hospitals, medical clinics, and to supply of water and electricity. Barrick spent a further $2 billion on local goods and services in 2008, supporting local business development and entrepreneurship within these communities.

Barrick is currently implementing a global Climate Change program – one of the first in the gold mining industry – and has invested $88.5 million in renewable energy projects in Chile, Argentina and Nevada. Barrick was a leading participant in the development of the International Cyanide Management Code and has achieved Code certification of 19 of its operations – more than any other gold producer.

Barrick conducts its business around the world in accordance with all applicable laws and regulations and the highest standards of honesty, integrity and ethical behavior. To be credible and relevant, activists and non-governmental organizations should be held to these same high standards for accuracy and accountability. We trust the following will contribute to a more informed understanding of the realities of how we do business and how our operations are contributing to socio-economic development in communities around the world.

BULYANHULU MINE, TANZANIA

“Local residents allege that over 50 artisanal miners were killed by Tanzanian troops in order to clear the mining concession to make way for commercial operations.”

Ms. Karyn Keenan, Program Officer, Halifax Initiative Coalition, to the Standing Committee on Foreign Affairs and International Development, October 22, 2009.

This allegation illustrates a willful distortion of the facts that bears no connection to reality.

Since the extraordinarily serious claim of the burial of artisanal miners at the Bulyanhulu site was first made in 1996, it has been extensively investigated by credible, independent sources, including the World Bank at the urging of the Lawyers Environmental Action Team (LEAT). This allegation has been shown to be untrue and discredited. Repeating such a claim demonstrates a reckless disregard for the truth.

Barrick acquired the Bulyanhulu property in 1999, three years after this incident was alleged to have occurred. In 2002, the Compliance Advisor/Ombudsman (CAO) of the World Bank undertook to assess LEAT’s allegations, after previous investigations by, among others, Tanzanian police and subsequently Barrick found its claim to be false.

The CAO is the independent, impartial recourse mechanism responsible for investigating public complaints concerning projects supported by the International Finance Corporation (IFC) and Multilateral Investment Guarantee Agency (MIGA), the private sector lending arms of The World Bank Group.

The Ombudsman conducted a comprehensive investigation into LEAT’s allegation, speaking with local people and eyewitnesses and reviewing police reports and documentation. The company cooperated fully in this investigation.

Appended to this submission is a copy of the report of the CAO which discredits the allegation made by LEAT. It would have been a simple matter for the Halifax Initiative Coalition to verify the credibility and veracity of the extremely serious and demonstrably false statement they have made to Committee members.

The Ombudsman’s report is highly critical of the lack of accountability of those involved in making this claim, stating:

“To repeat an allegation that one knows not to be true, especially an allegation of murder, has consequences. It has consequences on the business reputation and trading ability of a private enterprise and on the individuals concerned. There may be legal consequences to such actions.”

The Ombudsman expressed “distress” that “some NGOs have felt that they may act with impunity in this case…The consequence is a backlash against the ‘non-accountability’ of NGOs.”

These are the facts:

  1. Barrick had no involvement whatsoever, nor were we complicit in the removal of artisanal miners from the Bulyanhulu site in 1996, which was then owned by Sutton Resources. Barrick did not acquire Sutton Resources until 1999.
  2. Not a single artisanal miner was killed when they were removed by the government from the site in 1996. In fact, extraordinary steps were taken to ensure that all persons were removed from the site before the shafts were filled in.
  3. Those falsely alleged to have been buried alive were later located in nearby villages. There is evidence that some local people had made false claims.
  4. As the Ombudsman stated: “The CAO team met with local people who stated that their relatives were among the 52 killed. Yet their neighbors took pains to tell the CAO team that these relatives were alive and well, or in one case had died in a mine accident prior to August 1996. In other cases, the Tanzanian press has found people alive in other parts of the country, who it is alleged died at this time.”
  5. The CAO report also stated that the mines’ activities conformed with mining industry best practice.

Any implied claim of criminality and misconduct by Barrick is part of a carefully orchestrated campaign of defamation for the purpose of publicly embarrassing the company and harming its reputation and ability to conduct its business.

 

NORTH MARA MINE, TANZANIA

 “An independent scientific report released just this week supports reports that we have been receiving from communities near the North Mara Gold Mine regarding serious human health impacts and even deaths related to acid mine drainage, heavy metal and cyanide leakage from the mine into the surrounding environment, and particularly into the nearby rivers.”

Ms. Catherine Coumans, Mining Watch Canada, October 8, 2009.

In May 2009, an environmental incident occurred when water seeped from a mine rock storage facility into the Tigithe River. The situation was caused by high rainfall during the spring rainy season, which resulted in run-off from a temporary mine rock storage facility located on the property, near the river. The run-off water passed through rock that contained an elevated amount of naturally occurring sulphur, making the water acidic – a process known as acid rock drainage (ARD).

The seepage was exacerbated by the theft of protective high density material used to line waste water ponds located on the property. Thieves had cut out sections of the liner to sell for roofing for houses and other purposes in the outlying villages.

This incident occurred over a short period of time and was limited to a small geographic area. When decreased pH levels were detected in a limited section of river (approximately 1000 meters downstream), immediate action was taken by mine officials to notify authorities and contain the seepage.

All water storage ponds were fitted with new liners and the temporary mine rock storage facility was relocated. Subsequent water sampling confirmed that pH levels in the river returned to normal and remain within statutory requirements under the Tanzanian Mining Act.

With respect to Ms. Coumans’ allegations, these are the facts:

  1. This event was an isolated incident and to date there is no evidence that there has been “serious human health impacts or even deaths” associated with this event.
  2. Contrary to some local print media reports alleging fatalities of people and livestock, when government authorities traveled to North Mara to investigate, they found no evidence to support these claims. In fact, no confirmed cases of exposure resulting in health impacts have been brought forward by government authorities to the company.
  3. The operation is subject to significant regulatory oversight. Regulatory authorities from the state environmental and mining departments visited North Mara to review the mine’s corrective measures and expressed satisfaction with the actions taken. In October, the Parliamentary Sub-Committee on Land, Natural Resources and Environment also visited the site and agreed with this conclusion. Tanzanian President Jakaya Kikwete also visited the site and, in a public meeting, indicated he was pleased with the mine’s corrective actions.
  4. No cyanide was released into the environment. The ARD seepage took place in an area where cyanide is not used. Neither the Tigithe nor the Mara River are downstream from the mine site and the area where cyanide is used. Any claim of “cyanide leakage” illustrates a lack of understanding of the use of cyanide in mining operations and processes.
  5. North Mara is certified under the International Cyanide Management Code, which encompasses all aspects of cyanide management.
  6. As part of constructive engagement with the community, the mine also engaged with community leaders to apprise local residents of the role of the lining material used in water storage ponds in an effort to prevent future incidents.

 

PORGERA JOINT VENTURE, PAPUA NEW GUINEA

Environmental Management

This year Norway‘s government pension fund announced that it has dropped its shares in Canada‘s Barrick Gold as a result of the Porgera Joint Venture mine waste disposal into an 800-kilometre longStrickland River system. This is a mine that literally dumps its tailings and its waste (inaudible) directly into a huge tropical river system…”

Ms. Catherine Coumans, Mining Watch Canada, October 8, 2009.
The decision by the Norwegian pension fund was not unexpected. The fund has consistently divested its holdings in extractive companies utilizing riverine tailings disposal for some time, including Rio Tinto, Freeport McMoRan and Vedanta Resources. The fund declined an invitation to engage in a discussion with the Porgera Joint Venture’s technical experts. Overall, we disagree with the reliability of many of the findings that informed their decision and with the conclusions they reached, while accepting that they are free to invest as they wish.

The notion that the Porgera Joint Venture (PJV) “literally dumps its tailings and its waste directly into a huge tropical river system” is both misleading and incorrect. It omits relevant information related to the very unique operating conditions at PJV and environmental mitigation measures in place at the operation, including the pre-discharge treatment of tailings.

Under a comprehensive permit issued by the Government of Papua New Guinea (PNG) to Placer Dome in 1989, the mine follows a government-approved environmental management and monitoring program. The PNG government approved the practice of riverine tailings discharge following extensive consultations with local stakeholders, recognizing the very unique operating environment and risks associated with the area. The mine is situated in an area that is subject to seismic activity and extreme tropical rainfall, which cause frequent landslides. The area’s very steep and unstable terrain makes the safe construction and operation of a conventional tailings facility very challenging.

Environmental measures in place include:

  1. Pre-discharge treatment at the site, which entails cyanide destruction of the carbon-inleach tails, followed by neutralization of the final tailings through the addition of lime in the processing plant’s neutralization circuit.
  2. Extensive water monitoring using stringent processes developed in conjunction with the Commonwealth Scientific and Industrial Research Organization (CSIRO), Australia’s national science agency. Monitoring data is reported on a regular basis to the PNG government and to local stakeholders.
  3. A team of over 20 environmental staff monitor the operation.
  4. Specific water quality limits for discharges at the downstream compliance point use Australian/ANZECC (Australian & New Zealand Environmental Conservation Council) water quality guidelines. To our knowledge, the mine has never exceeded its compliance permit levels.


Evaluation Study by Barrick

Upon Barrick acquiring its interest in the PJV in 2006, a comprehensive two-year study was conducted to review and evaluate alternatives to improve and reduce the discharge of tailings. This $5 million review examined the feasibility of building a large tailings storage facility (TSF) and other alternatives to mitigate environmental impacts. The evaluation team included an external engineering firm and other experts and took into account a full range of highly complex technical, environmental, social and regulatory factors – many unique to PNG and the Porgera Valley.

The study identified significant risk factors in ensuring a stable foundation for a large tailings storage facility due to the instability that can accompany high rainfall, deep soil cover and very steep terrain – a risk that would exist during construction, operation and following mine closure. In addition, social factors such as the law and order challenges in PNG and, in particular, the presence of illegal miners were identified as significant risk factors. Reviewers recognized that groups of illegal miners would likely dig and pan for gold from tailings captured within the tailings impoundment, leading to erosion of the dam structure.

As a result, riverine tailings disposal will continue at this time, with the following continuing improvements and modifications to improve and reduce tailings discharge:

  1. A new $35 million paste backfill plant will be operational in 2010. Once operational, at least 10 per cent of tailings that would have been otherwise released will be blended with cement and stored permanently underground.
  2. Plans to increase ore production from the underground mine, resulting in an opportunity to store more tailings underground in the mine as backfill.
  3. In 2007, cyanide destruction of carbon-in-pulp was improved to further break down cyanide compound in tailings.
  4. In November 2009, the mine was officially certified under the International Cyanide Management Code.
  5. Consistent with Barrick’s Environmental Management Program, the operation is currently pursuing ISO 14001 certification.


Security and Human Rights

“…there have been allegations of killings of civilians by the Porgera mine security guards, and these allegations became the subject of a Papua New Guinea government inquiry in 2005 and 2006, but that final report of that inquiry was never released. In 2005, then-owner of the mine, Placer Dome, did admit in a newspaper article to eight deaths at the hands of its security guards.”

Ms. Catherine Coumans, Mining Watch Canada, October 8, 2009.

Barrick and the PJV do not tolerate human rights violations. We also reject the characterization of the company’s security personnel as violent and unlawful.

Barrick’s security policies are aligned with the Voluntary Principles on Security and Human Rights, as are the policies of PJV. It is mandatory for all security personnel to respect people and human dignity and abide by the Voluntary Principles. The Voluntary Principles encompass the United Nations Basic Principles on the Use of Force and Firearms by Law Enforcement Officials and the UN Code of Conduct for Law Enforcement Officials. These principles guide companies in maintaining the safety and security of their operations within an operating framework that ensures respect for human rights and fundamental freedoms.

These are the facts:

  1. Since Barrick acquired its interest in the PJV in 2006, there have been no fatal shootings by Porgera security personnel.
  2. Prior to this period, when Placer Dome was the majority owner of the PJV between 1996 and 2005, seven people were fatally shot by security and one by police. In all instances these fatalities occurred when security and police were attacked by armed illegal miners and responded to protect their lives.
  3. PJV security personnel have been required to respond to incursions by illegal trespassers (who are at times armed) and enter the mine intending to engage in theft. Numerous employees have been injured during these encounters.
  4. Placer Dome and PJV cooperated with the PNG government’s investigation of security issues; however the government makes its own decisions regarding the public release of government investigations and reports.
  5. The PJV has facilitated human rights training for PNG mobile police squads, based on international human rights laws and the Voluntary Principles. This training initially involved the United Nations Development Program. In late 2007, PJV collaborated with the International Committee of the Red Cross (ICRC) on human rights training, engaging ICRC-accredited trainers and using an ICRC training module.
  6. In 2008, the PNG police integrated formal human rights training as a part of its training programs for both the mobile squad and new recruits. As a result, the training program that had been previously facilitated by the PJV has become part of the curriculum at the PNG Bomana Police College and is used as a module for management courses. This training is delivered by ICRC-accredited instructors.
  7. The PJV continues to advance the adoption and implementation of the Voluntary Principles in all relevant formal agreements with the Royal Papua New Guinea Constabulary.


Allegation of Sexual Assault by PJV Security Personnel

Dating to the 1990s, there have been reports of serious human rights abuses associated with the mine. Individuals we have spoken with have detailed allegations of the following grave abuses: rapes, including gang rapes; physical assault; and killings. The PNG government and the PJV mine have responsibilities to investigate such allegations; however, based on interviews and documents obtained in PNG, independent investigations by these parties appear unlikely.”

Mr. Tyler Giannini, Lecturer on Law, International Human Rights Clinic, Harvard Law School, October 20, 2009.

We are alarmed by the extraordinary and extremely serious accusation that security personnel working at the Porgera mine may have sexually assaulted local Porgeran women. This claim is further compounded by the outrageous and damaging accusation that the PJV or Barrick would fail to conduct an investigation should such an incident be reported. We also note the testimony made by Ms. Sarah Knuckey with the Centre for Human Rights and Global Justice.

These are the facts:

  1. To our knowledge, there have been no cases of sexual assault reported to mine management involving PJV security personnel while on duty, since Barrick acquired its interest in the mine in 2006.
  2. It is not possible for the PJV to investigate an allegation it has never received and which has never been relayed by police or any other source. Numerous avenues exist to report such an incident to the company, police, and judicial authorities, the Ombudsman of PNG or the Porgera District Women’s Association (PDWA).
  3. Barrick and PJV would encourage anyone who has information related to a serious crime of this or any other nature to report it immediately to PNG authorities in order for it to be properly investigated and receive due process under the law. If the crime allegedly involves Barrick or PJV, it should be reported to them as well. In the absence of any such report, PJV and Barrick are unable to conduct an investigation.
  4. At PJV, any matter of a criminal nature that occurs on mine property is reported to the Royal Papua New Guinea Constabulary which has the responsibility to investigate. In addition, PJV would conduct its own investigation into possible breaches of the company Code of Conduct or procedure.
  5. If a report of a sexual assault which was alleged to have involved an on-duty PJV employee had been made to the site, a full investigation would have taken place, including medical assistance and a detailed interview of the alleged victim and other potential witnesses.
  6. The PJV Security team is subject to numerous levels of supervision and must report all illegal miners and other trespassers onto the property, including women and children. Illegal miners and other trespassers on the active mining areas is tracked daily.
  7. In April 2009, the PNG Government deployed additional police resources to reestablish law and order and to address the significant security concerns of people living in the Porgera region and elsewhere in Enga province. Approximately 150 officers were sent to the region to address increased tribal fighting, lawlessness, and serious crimes such as sexual assault and illegal mining, which have had a detrimental impact on these communities.
  8. In June 2009, the Porgera District Women’s Association (PDWA) submitted a petition to the government in support of the police deployment signed by 5,000 people from the Porgera community. The petition requested an extension of the police deployment. The PDWA cited significant improvements in law and order and improved conditions for women and children in the region.
  9. The PDWA has been a vocal advocate for women’s rights and law and order in the Porgera region. If incidents of rape and violence against women were being perpetrated by PJV personnel, this organization could be expected to draw attention to the issue and advocate on behalf of victims. To our knowledge, the PDWA has never raised such an allegation.
  10. Barrick and Porgera mine management recognize that violence against women in PNG and the Porgera Valley is a significant problem which relates directly to the law and order situation and the position of women within PNG Highlands society. Through its community programs, the Porgera mine is helping to empower local Porgeran women to become respected members and leaders of society. This includes financial support to the Porgera District Women’s Association as well as programs to enable women to become economically self-reliant, to improve women’s literacy and provide scholarships, and the recruitment of women for non-traditional mining jobs.


Police and Reservists

We have concerns about the independent investigations because mine security forces are comprised largely of police reservists.”… “Law enforcement officers we spoke with also indicated that the police reservists comprise the majority of the mine’s armed security officers and take day-to-day orders from mine officials.”

Mr. Tyler Giannini, Lecturer on Law, International Human Rights Clinic, Harvard Law School, October 20, 2009.

To be clear, since Barrick acquired its interest in PJV in 2006, there have been no fatal shootings by Porgera security personnel.

Currently, less than twenty per cent of mine security personnel are enlisted reserve police in the Royal Papua New Guinea Constabulary (RPNGC). Under the PNG Police Act, all reservists are answerable to and act under the command of the RPNGC. We wish to emphasize that when acting as reservists, employees are not “taking day-to-day orders from mine officials.”

Under a Memorandum of Understanding between the RPNGC and the PJV, the PJV agreed to release from active work duties any employee who is a reserve police officer to the RPNGC when requested by the local police station commander or other RPNGC personnel. PJV typically releases four to five employees at a time for active reserve police duties under this formal arrangement.

Duties may range from such mundane tasks as prisoner and vehicle escorts to assisting RPNGC to attend to more serious tribal disputes and other serious confrontations, where no other option exists. These facts can be verified through the Office of the Commissioner of Police in Papua New Guinea.

Overall, police in this region face significant challenges in addressing the problem of crime, violence and tribal fighting. Reservists play a crucial role in supporting under-resourced police in their efforts to maintain law and order.

Police officers have also indicated that their investigative efforts have been hampered by PJV security officers who may have restricted immediate access to crime scenes within the mine and, in their view, may have tampered with evidence.”

Mr. Tyler Giannini, Lecturer on Law, International Human Rights Clinic, Harvard Law School, October 20, 2009.

This statement is simply untrue. Mr. Giannini’s unfounded allegations can be readily discounted by contacting the Commissioner of the Royal Papua New Guinean Constabulary directly.

Whenever there has been an incident requiring police at PJV, they have been immediately notified and given full cooperation. There has never been restricted access to the mine site.

MARCOPPER MINE, PHILIPPINES

“EDC also funded the Marcopper Mine on Marinduque Island in the Philippines where environmental contamination destroyed the source of livelihood for local fishing villages.”

Ms. Karyn Keenan, Program Officer, Halifax Initiative Coalition, October 22, 2009.

Barrick has never owned nor did we ever acquire an interest in Marcopper Mine, which was located on the island province of Marinduque in the Philippines. Placer Dome, a company which Barrick did acquire, was at one time a minority shareholder (39%) of Marcopper Mining Corporation. Placer Dome sold its interest in that company in 1997, years before Barrick’s acquisition of Placer Dome in 2006. Marcopper Mining was the operator of the Marcopper Mine.

Barrick inherited litigation initiated by the Provincial Government of Marinduque, which is seeking to recover damages for alleged environmental degradation with consequent economic damages in the vicinity of the former mine. This matter is now before the courts in the Philippines and the United States and it would be inappropriate to comment further.

VELADERO, ARGENTINA

San Guillermo Biosphere Reserve

“Local actors who lodged a complaint (with the Argentinean Ombudsman’s Office) regarding Barrick’s mine (Veladero) were concerned about its impact on the San Guillermo UNESCO biosphere reserve. The Ombudsman accepted the complaint and in 2008 reported the mine concession violates several national laws. He called for an immediate halt to mining activity in the reserve.

“This year an Argentine environmental organization filed a complaint regarding the mine with the Supreme Court. The complainant who expressed concern that mining operations are causing irreversible damage to local glaciers have asked the court to issue an order for an audit that would assess whether the company is in compliance with national laws.”… “Last year, President Fernandez de Kirchner vetoed legislation designed to protect glacial deposits. The law which prohibits mining, oil and gas operations in or around glaciers received unanimous approval of Congress.”

Ms. Karyn Keenan, Program Officer, Halifax Initiative Coalition, October 22, 2009.

Again, this statement contains a number of errors. These are the facts:

  1. Veladero does not mine on or under any glacier nor are there plans to remove or interfere with glaciers in the area. This operation was subject to a comprehensive, rigorous environmental assessment process by Argentine authorities, with the full participation of communities and stakeholders. This process included consideration of the San Guillermo Biosphere Reserve. The mine operates in accordance with an environmental permit and is subject to ongoing environmental monitoring and regulatory agency audits.
  2. Barrick understands that pursuant to existing legislation, the Veladero mine and processing facilities are not located within the San Guillermo Biosphere Reserve area, nor in the San Guillermo National Park, which forms the core zone of the Biosphere Reserve. Rather, they are located in an area adjacent to the third zone of the Biosphere Reserve known as the Transition or Multiple Use Zone. No law or regulation prevents mining activity in this third zone or the area adjacent to it, where the company’s mine and processing facilities are actually located.
  3. The Ombudsman of Argentina did not call “for an immediate halt to mining activity in the reserve.” The December 27, 2007 resolution of the Ombudsman is a non-binding document that contains recommendations to the Administration of National Parks and San Juan Province only. Furthermore, the resolution did not conclude that Veladero is violating Argentine laws and regulations, nor did the resolution prohibit mining activity in the Biosphere Reserve. The resolution recommended that the province and the Administration of National Parks develop a master plan for biosphere reserve management. Barrick understands that this plan is currently being finalized.
  4. Mining activity at Veladero does not in any way undermine the function or objectives set out by UNESCO for Biosphere Reserves. These consist of conservation in a core zone, logistical support for conservation in a buffer zone, and sustainable development in a multiple use or third zone.
  5. Barrick is not opposed in principle to glacier protection legislation in Argentina or elsewhere. Proposed Argentinean legislation related to glaciers is currently before Congress.
  6. The company has not been notified by the Supreme Court of any claim or complaint related to the San Guillermo Biosphere Reserve Area.
  7. As with any mining project or operation in proximity to a natural protected area, Barrick is committed to protecting the environment and supporting sustainability and actively participates in the San Guillermo Biosphere Reserve Consultative Committee.
  8. As a member of the International Council on Mining and Metals (ICMM), Barrick is required to operate in accordance with Principle 7 of the ICMM Sustainable Development Framework, which stipulates that members respect legally designated protected areas. Under the Framework, member companies must undertake “not to explore or mine in World Heritage properties” and must take all possible steps to ensure that operations adjacent to World Heritage properties “do not put the integrity of these properties at risk.”

PASCUA-LAMA AND VELADERO, ARGENTINA AND CHILE

On November 24, 2009, Ms. Romina Picolotti, an activist and former Secretary of the Environment in Argentina, appeared via a web-link before the Standing Committee and unleashed a series of false and unsubstantiated allegations against Barrick.

“I approached Barrick in 2006 as Environment Secretary to exercise my jurisdictional authority over the San Guillermo Biosphere Reserve, a UNESCO site and national park in the province of San Juan where Barrick’s Veladero mine is located… Barrick refused to give my team access to the lands in their mining territory…” (R. Picolotti)

These are the facts:

  1. Like other responsible companies, Barrick does not restrict or decline government official requests or the right of regulatory agencies to dutifully pursue their responsibilities.
  2. Upon checking our records yesterday, Barrick determined that there was only one request on file for 2006 from the Argentine federal environmental authority related to the generation and management of hazardous waste. That inspection occurred and the permit was subsequently granted.

“If the President would not veto the (glacial protection) law, Barrick would work to block all the financial bills that were critical to stabilizing the Argentine economy during the global financial crisis.” (R. Picolotti)

  1. In relation to this claim, it is difficult to imagine what financial retaliation Ms. Picolotti was talking about.
  2. Barrick does not have the authority to withhold revenues owing to any government and did not issue any ultimatum about proposed legislation.

“I and my closest staff were personally and physically threatened following our mining intervention. My children were threatened, my office was wiretapped, my staff was bought and the public officials that once controlled Barrick for me became paid employees of Barrick Gold.” (R. Picolotti)

  1. This is the first time that this allegation has come to our attention. If any of this were true, Ms. Picolotti should have immediately gone to the police or responsible authorities, and these allegations could have been properly investigated at the time.
  2. We are not aware of any official who worked in Ms. Picolotti’s office who is now employed by Barrick.

“I was forced to resign to the insurmountable pressures from companies like Barrick Gold who ultimately get their way when our institutions fail to control their compliance and performance.” (R. Picolotti)

  1. Barrick does not make or influence the decisions of the President of the Republic of Argentina with respect to cabinet appointments or resignations.
  2. The Company has an obligation to abide by the laws and comply with regulations in respect of its mining operations. Ms. Picolotti’s testimony acknowledges that “I am not a judge…I cannot say that if Barrick complies or not with the law.”
  3. The particular circumstances surrounding Ms. Picolotti’s departure from the Argentine government have been widely reported in Argentine media.

CONCLUSION

The natural resources sector is a principal engine of economic development in many developing countries, including some of the poorest places in the world. Barrick and other responsible mining companies based in Canada are generating jobs, taxes and royalties, purchasing local goods and services, and providing training and access to health care and education at a level unprecedented within these countries. We share many objectives in common with civil society and NGOs and will often collaborate with like-minded organizations, working as partners to promote development and advance socio-economic progress.

In this context, it is a grave concern when groups ideologically opposed to mining circulate misinformation and unsubstantiated claims of serious wrongdoing and criminal conduct. If unchallenged, these groups can polarize and even destabilize the very communities whose best interests they purport to represent. Ironically, attacks designed to impugn the reputation of Barrick and others in our industry may serve to thwart economic development and hinder the aspirations of communities and people seeking to improve their quality of life.

We trust the information provided in this submission illustrates how corporate social responsibility and environmental stewardship are an integral part of how we do business, consistent with Canada’s commitment to uphold human rights. We would be pleased to provide additional information to Committee Members should further clarification be required. Additionally, Committee Members may wish to contact the relevant governments in the sovereign countries where Barrick has operations or projects.

 

PAPUA NEW GUINEA (PNG)

  • 39% of the population live below the national poverty line, earning less than a dollar a day.
  • Ranked 148 out of 182 countries by the United Nations Human Development Index.
  • Poorest social indicators in the Pacific Region.
  • The Department of Foreign Affairs and International Trade travel report cites “high levels of serious crime” and that “law and order remain very poor in the Highlands provinces…” (www.voyage.gc.ca)
  • About 40% of Papua New Guineans enroll in school.
  • The development of the country’s natural resources is a principal engine of economic activity.

(*Statistics courtesy of UN Human Development Index 2009 report)
PORGERA JOINT VENTURE

  • One of the largest resource projects in PNG.
  • Largest employer in the Porgera Valley. 2,500 full-time employees (95% PNG nationals) and over 500 contractors.
  • Injected $342 million into economy through procurement of local and regional goods and services.
  • $525 million in taxes, duties and royalties to the PNG economy since 1994.
  • Estimated 12% of PNG national export earnings over life of mine.
  • Prior to the mine commencing operations in 1990, the region had very limited access to health care, education and other basic services. Since that time, substantial socioeconomic benefits have been generated and the provision of these services has been vastly improved.
  • Over $60 million invested in vital community infrastructure, health care and education and to construction of roads, bridges, schools and medical facilities that help improve quality of life.
  • $40 million spent on skills training to improve skills of population.
  • Adult Literacy program has helped more than 2,500 people in Enga province learn essential reading and writing skills.
  • Over 665 students have received scholarships and grants, since 1990.
  • Comprehensive HIV/AIDS program for employees and community encompassing prevention and treatment.
  • Child vaccination program has helped address high rates of infant mortality from easily preventable diseases.
  • Partner in the Restoring Justice Initiative, a multi-stakeholder initiative to help communities in Enga province address issues such as law and order, tribal fighting, violence against women, substance abuse and illegal mining. Involves the national, provincial and district governments and community stakeholder agencies.

TANZANIA

  • 30% of the population lives below the national poverty line, earning less than a dollar a day.
  • Adult illiteracy rate of 28%.
  • One of highest HIV/AIDS prevalence rates at 9%.
  • Ranked 151 out of 182 countries according to the United Nations Human Development Index.
  • Average life expectancy is 55 years. (*Statistics courtesy of UN Human Development Index 2009 report)
  • Nascent gold mining industry is still relatively small by global standards but has become one of Tanzania’s most promising early stage sectors, following government reforms in late 1990s.
  • Large-scale gold mining industry has provided significant improvement to Tanzania’s economy, with major contributions still to come.
  • Among most significant contributions is industry’s effect on foreign direct investment. (Source: The Golden Building Block: gold mining and the transformation of developing economies, An economic life-cycle assessment of Tanzanian gold production, World Gold Council, September 2009)
  • More than $2.5 billion in capital has been invested by gold mining companies over the past decade. Barrick’s investment alone is $1.5 billion.


BARRICK IN
TANZANIA

  • Four operations in northern Tanzania (North Mara, Bulyanhulu, Buzwagi, Tulawaka).
  • US $115 million in goods and materials, and US$118 million in services procured in Tanzania.
  • Over 2,000 registered local suppliers were used in 2008.
  • Over $40 million to Tanzanian government annually, through various forms of payment (e.g. royalties, levies, payroll taxes).
  • Over $100 million invested in power infrastructure in Tanzania, where only 14 per cent of the population has access to electricity. Through funding to TANESCO (Tanzanian Electrical Supply Company Limited), transformers are being installed in a number of communities to allow power to be used locally. Example: The town of Kakola (pop. 17,000) near Bulyanhulu mine now has access to power for the first time.
  • Through a Tanzania Chamber of Minerals & Energy initiative, Barrick has contributed $4.5 million a year for the Integrated Mining Technical Training (IMTT) program, a national program to develop skills in the mining sector and reduce reliance on expatriate workers.

NORTH MARA MINE

  • Unlike other properties, located close to the Tanzanian/Kenyan border.
  • Remote area highly underdeveloped, significant in-migration with operation drawing transients and illegal miners.
  • Over 700 employees and 400 contractors.
  • Significant social investments to support and improve government service provision with a focus on health and education in seven local villages.
  • Health program to combat HIV/AIDS and malaria, including voluntary counseling and testing for the community.
  • 1% royalty payment to villages used to pay for education scholarships valued at nearly $1 million to date. 2,000 students studying in schools and colleges under these scholarships in 2009.
  • Pilot project to assist artisanal miners to organize and gain access to land and modern technology and improve environmental and safety practices.


BULYANHULU MINE

  • Over 2,000 employees.
  • Comprehensive health program to combat HIV/AIDS and malaria, including a dedicated HIV/AIDS wing of the company medical clinic serving employees and wider community.
  • Investments in water projects and power benefiting towns, schools and area medical facilities.
  • Through a $2 million education partnership with CARE International Tanzania, built eight new primary schools and the first high school in one ward of the Kahama District, increasing primary school enrolment by 75 per cent and doubling high school enrolment from 2001-2007.
  • In 2002, constructed a $2.2 million water pipeline spanning 47 kilometers from Lake Victoria to the mine, making clean water available to 30,000 people living in villages along route. Further investments in community water well projects have benefited thousands more.
  • Cooperative program has enabled 200 local farmers to become suppliers to mine site, in partnership with catering service provider Sodexo.


BUZWAGI MINE

  • New $400 million operation in Tanzania.
  • Over 3,000 jobs generated during 18-month construction phase.
  • 700 direct jobs and 2,800 indirect jobs during operation.
  • Extensive training program to hire predominantly Tanzanian workforce (93%).
  • Expected to pay nearly $300 million in royalties and taxes over life of mine.
  • Recent program to install and upgrade water wells providing clean water to more than 2,500 people.
  • Emergency health services now available in the area for the first time.
  • Investments in education, health and local procurement.
  • Barrick recently launched the Lake Zone Health Initiative in collaboration with the Government of Tanzania, health NGOs, donors such as The United States Agency for International Development (USAID) and other mining companies to work together to combat HIV and malaria and improve health services for the region’s nine million people.


BARRICK IN
ARGENTINA

  • Veladero mine is Barrick’s sole operation in Argentina.
  • Pascua-Lama project, located on the border between Argentina and Chile, now under construction. Preproduction construction estimate $2.8 – $3 billion.
  • Mining sector fostering economic development and creating jobs in regions facing high unemployment.


VELADERO MINE

Four years into operation, Veladero mine is an important catalyst for economic development and source of investment.

  • Economic impact equivalent to 23% of GDP of San Juan Province and 46% of total provincial exports (from 2005 to 2007).
  • 1,000 direct jobs and 5,000 indirect jobs.
  • Invested $8.5 million to build world’s highest wind turbine, providing renewable energy to operation.
  • Community participation in water sampling program to independently test and monitor water quality.
  • Health and education a focus of community investments, including teacher training, women’s health and construction of new pediatric ward at Rodeo Hospital in San Juan.
  • 2,000 children have participated in Barrick’s annual dental care program
  • 1,000 women in remote towns in Argentina screened for early detection of breast and uterine cancer.
  • 15,000 teachers have been trained in South America to help improve the quality of education and introduce computer technologies into remote classrooms.
  • Community investments to promote economic development in San Juan Province are improving agricultural productivity and market access and supporting the development of a tourism industry in the district of Iglesia.

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