Conga Conflict

Reporting on the conflict between the mega mining project Conga and the people of Cajamarca, Peru

Belgian NGO shares concerns about Deutsche Bank investments in Newmont with Bank´s Directors

May, 2013

Respected board and shareholders,

As a spokesperson of CATAPA, a Belgian NGO that focuses on the social and environmental impact of open pit mining I feel urged to share our concerns related to the investments of the Deutsche Bank in the American multinational Newmont Mining Corporation, one of the largest producers of gold with active mines all over the world.

The Yanacocha mine in the region Cajamarca, in the North of Peru, is the second biggest gold vein of the world and for 51% owned by Newmont Mining Corporation. Newmont is now planning a new project, which would be an extension of the existing Yanacocha project and is called Conga. This project will take at least 19 years.

Deutsche Bank is one of the key stakeholders of Newmont Mining owning 2,15% of the total amount of shares corresponding to a worth of 407 million euro. In May 2011, Newmont Mining Corporation secured a five-year revolving credit facility with the total amount of 1,8 billion Euro from a syndicate of 13 banks, including Deutsche Bank. Thereby, Deutsche bank also participated as a book runner for Newmont Mining Corporation by lending them 72,4 million euros by Deutsche bank Securities Corp Germany. These numbers show a strong financial involvement by Deutsche Bank in Newmont Mining Corporation.

I would like to refer to the words of Josef Ackermann, Chairman of the Management Board and the Group Executive Committee in Frankfurt am Main on the 20th of March 2012. “We can only remain successful in the long term if people see us as being responsible and place their trust in us. That is why social responsibility is an integral part of our work, as it benefits our company as well as society as a whole.” and I also would like to refer to the following quote found on the website of Deutsche Bank:” the financial sector is playing a valuable role in society and that we act with responsibility in everything we do. 
Newmont Mining Corporation communicates on their website that their leading performance is reflected through high standards in environmental management, health and safety for its employees and by creating value and opportunity for host communities and shareholders. Dear audience, all this is nothing but pure green washing. Newmont Mining Corporation isn’t at all operating in a sustainable way. The mining activities of this company are causing enormous damages to Peru’s most fragile highland ecosystem and its local population. Gold is extracted by Newmont Mining Corporation with the use of chemicals such as cyanide. Furthermore during the mining process a lot of heavy metals such as lead, arsenic and copper are brought to the surface, enter the ecosystem and cause acid drainage. Taking a closer look at the Yanacocha project we observe three major areas of concern: (1) Water pollution. (2) The loss of agricultural land (3) Repression and social protests.

Water pollution
The mining activities of Newmont Mining Corporation destroy the water resources of the local communities. The Yanacocha mine already used all the water of the Yanacocha Lake and with the extension of the Conga project, 4 more lakes will be emptied. These lakes form an indispensable water supply for the 74000 people of small communities in the area and 240000 inhabitants of the city Cajamarca, all highly dependent on these sources for their cattle, crops, cooking and washing. The extension of the mining activities puts the region at risk to dry out completely and lose its agricultural potential. 
Moreover, to extract the gold from the ore, a lot of cyanide is used, more specifically 238 kg for 1 kg of gold. Due to the irresponsible way of mining this high toxic chemical together with the heavy metals that arise on the surface due to the exploitation will enter into the ecosystem. The Conga mine will be built near the spring of the Rio Grande River. As the polluted Rio Grande River finally flows into the Pacific Ocean, fish but also the further food chain for human consumption will finally end up containing a high amount of heavy metals.

The loss of agricultural land
Not only because of water depletion agricultural land is affected. The Yanacocha mine has already affected more than 20.000 hectare of agricultural land. The Conga project will affect another 18.000 hectares of land in the following 17 years. Only 8% of the tons of rocks that will be extracted contain useful metals, the other 92% is entirely toxic waste. If we besides bring all the small mining projects into consideration, than more than 150.000 hectare of land will be destroyed in the same region. This digging away of the soil leads to a loss of land for agricultural communities. They will have no other choice but to migrate to the city without any compensation for their loss of land.

Repression and social protests
Around the Conga project, a huge social conflict has evolved. In February 2012, more than 100.000 people participated in the national march for water from Lima to Cajamarca to out their “no to Conga” to the government. The answer of the government, collaborating with Newmont Mining, is clear: repression and criminalisation of the local communities. People have been followed, spied at and tortured. Last year, 5 farmers of the affected communities in Peru have been killed while resisting against the Conga project. They were murdered by aggressive military groups, hired by the mine companies.

The impact of open pit mining projects such as Conga is so intensive and damaging that in 2010 Costa Rica decided to ban this type of mining altogether. On the 5th of May 2010, the European Parliament also adopted a resolution to forbid the use of cyanide in Europe in large-scale mining. The European Commission also recommended not to support mining projects, both in a direct or an indirect way that are using cyanide, both inside AND outside the EU. Well, dear audience, despite all of this Newmont Mining Corporation owns this kind of mining projects where cyanide is used, and Deutsche Bank continues to financially support them. Due to investors such as Deutsche Bank these kind of projects can proceed without any limitations. With your help companies such as Newmont Mining Corporation can carry on destroying watersheds, cultivable land and the life of people.

Respected Board, do you consider the fact that Deutsche Bank finances Newmont Mining Corporation in correspondence with your responsible business standards and do you think it is worth to risk losing your credibility of your shareholders and clients? Mr. Fitschen and Mr. Jain, after all you have heard now. Will you block the financial streams towards Newmont Mining Corporation in order to force them to act in accordance with independent environmental and human rights guidelines, the recommendations of the EC and your own statements? Will you furthermore urge for a clear, robust monitoring and reporting system to ensure that the company complies with its environmental and social obligations?

Dear shareholders, we recommend Deutsche Bank to start investing in real sustainable projects and not in green washing projects as these. Resource security will only be guaranteed by projects focused on recycling improvement technologies and resource efficiency instead of new primary extraction. As the amount of gold above the surface is 3 times higher than under, and as 1 ton of e-waste contains a 100 times more gold than one ton of rocks, there will be no other option for the future.

Thank you for your attention!

Facing Finance
Netwerk Bewust Verbruiken


One comment on “Belgian NGO shares concerns about Deutsche Bank investments in Newmont with Bank´s Directors

  1. Pingback: Thousands march against mega mining threat | CELENDIN LIBRE (ENGLISH)

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This entry was posted on June 3, 2013 by in Letter and tagged , , , , .
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