Colombia: Eco-gold, Another Deceit?
Gearóid Ó Loingsigh
09 April 2014
In March the people of Cajamarca, Colombia, voted overwhelmingly against the presence of mining companies in their territory, a stunning victory over Anglogold Ashanti (AGA). The people voted not just against mining but also in favour of water, the environment and against the destruction of the environment that goes hand in hand with gold mining. At the end of March, the felling of forests and the destruction of the ecosystem in the Department of Putumayo caused a flood and landslide that swept away Mocoa, leaving hundreds of victims in its wake. In Switzerland at the end of March, the Better Gold campaign was launched. These events are connected.
After the victory of the people in the public referendum in Cajamarca, the Colombian government discredited and rejected the result, stating that it was not binding and the mining would have to continue. When the river and the mud engulfed Mocoa, the government asked for our solidarity, and asked us not to think too much about the causes of the disaster. There is no shortage of NGOs that earn their bread reconciling the demands of the people with the needs of the multinationals and the state. They will not be missing from Cajamarca. They will be there again, as truth be told, the reconciliation discourse is ever present. They will say that we have to negotiate, that you have to understand the point of view of others, now that we are living in times of peace, and we all have to build a new country together, including the mining companies and perhaps we will have to listen to the paramilitaries that threatened the El Salmón(1) magazine for its reporting on and analysis of mining (By the way, there is no greater honour than a magazine being threatened by such lunatics). In the midst of this debate come the proposals for eco-gold, green gold, sustainable gold, just gold, a long list of euphemisms, or as the Swiss say, Better Gold.
The Better Gold campaign is not the only one of this nature, there are many and they all have similar aims. The first one is to convince us that there can be gold that does not harm the environment, they sow doubts among the people and shift the focus of the debate. The Better Gold campaign is one of those campaigns by NGOs that have been bought off by the mining companies. It is not a baseless accusation to blame the NGOs of being responsible for this fifth column that the companies want to set amongst us. On the official Better Gold website Fair Trade International appears as a member i.e. the champions of fair trade (in reality trade that is slightly less unjust, but that is a topic for another day).
Better Gold’s Mines
Better Gold promotes, according to themselves, a gold that is better in social and environmental terms. They support three mines in South America. One of their mines is in the town of Cuatro Horas, Perú, which barely produces 360 kilos of gold per year, according to Better Gold’s website. Another mine they support is Sotrami in Santa Filomena in the Atacama Desert, one of the driest spots on the planet. This mine produces about 400 kg per year. The web page does not yet have much information on the other mine.(2) Regardless, we can see that they are small mines, their production is low compared to that ofa large open cast mine or a deep shaft mine. The smallest AGA mine in South Africa, Kopanang, produces between three and four times that amount, depending on the year.
Just because they are small mines and what Better Gold itself and other responsible gold initiatives call sustainable, they are not ecological. They also use cyanide in the gold extraction process. So, what is better about them if they use the same poisonous chemicals as the large companies? In the case of the Sotrami mine, Better Gold claims that through the electrification of the area the town will stop consuming 80,000 gallons of diesel per year, with a resulting reduction in CO2 emissions equivalent to 779 tonnes. We have no reason to doubt this achievement. But, what has it got to do with a more sustainable gold? The answer is nothing. What we have here is trickery, a sleight of hand.
All large mining companies in the world “invest” in the communities. In order to win over people, they build schools, support water projects, electrification projects, which the mine also requires, as without electricity and water there is no gold mine and without schools, workers won’t bring their families with them. It is that simple. There is no difference between these projects and those of AGA in various parts of the world. However, we would not likely accept that AGA was an eco-friendly company and that its gold was better because it supported electrification. When we talk of an environmentally and socially sustainable industry, we are talking about its actual business, the extraction of gold. In this case, Better Gold, like all the other initiatives do not deserve to be deemed sustainable. Their business activity contaminates, destroys the environment and consumes large quantities of water, and on this point the Sotrami mine located in the driest desert in the world cannot be regarded as sustainable. Applying an average of 12 m3 of water per Troy Ounce (31.103 grams), Sotrami consumes at least 155,000 m3 of water per year, enough to meet the basic needs of 8,300 people (the town where the mine is located has a population of 4,000). The Sotrami mine uses cyanide, followed by an agitation with carbon and desorption process, which it is claimed helps absorb the cyanide. The method is not exclusive to small-scale mining; the large companies also use it. Perhaps the supposed good of the gold comes from using this method, but if that were the case then we would have to classify all the large companies as sustainable as well.
Better Gold Members
It should come as no surprise that these mines are not as nice as they would like us to believe. When we look at the list of members, we find various companies from the sector, such as diamond companies, or Cartier and Swatch, companies that require gold for the manufacture of their products, luxury items in one case and not so much in the other case. We also come across companies such as Metalor. Metalor is a company that shows us what is at stake when we uncritically accept supposedly sustainable mining projects. Metalor boasts of being a company that stands out for its work in pursuit of Conflict Free Gold (something similar to the campaigns against blood diamonds) and a “responsible” exploitation of gold. According to the World Gold Council:
Another company that supports Better Gold is UBS, a specialist company in the finance sector. According to its website, amongst its services are asset and wealth management and its very own Investment Bank.(5) In other words it is a predatory company from the financial sector, which takes advantage of deregulation in order to maximise profits and there are those who want us to believe that these people are concerned about the environment and in favour of greater regulation to protect it.
But at the end of the day, the problem does not lie with the members nor the mines but rather with the idea that the response to gold mining is to promote gold that contaminates less (not to say cleaner like the companies do, as it is not clean).
Gold, an unnecessary metal
One of the biggest problems with sustainable or eco-gold (though no one knows what that is) is that it ignores the main problem. The mining companies want to take the metal out of the earth and negotiate the level of pollution and the destruction of the environment with the communities. There is no mining without some degree of this and any attempt by the NGOs to convince us of the opposite is a lie paid for by their masters (the mining companies). They ask us to accept such ruination for the communities for a metal that the world does not need. The statistics from the industry itself show us exactly how useless this metal is.
In 2016, global gold demand for the jewellery industry was 2,041.6 tonnes, a decrease of 15% in respect of 2015.(6) But demand for investments increased dramatically rising from 918.7 tonnes to 1,561.1 tonnes. The ingots and coins accounted for 1,029.2 tonnes and the rest were investments in Exchange-Traded Funds. Industrial demand was 322.5 tonnes. In 2016, mines around the world produced a total of 3,236 tonnes and 1,308.5 tonnes were recycled, giving us a grand total of 4,570.8 tonnes. This means that in 2016 the mines produced sufficient gold to meet industrial needs for 10 years and if we include the recycled gold, 14 years. Furthermore, if we take a look at central bank reserves around the world, we find that in March 2017, they held 33,292.8 tonnes. The majority of these reserves are concentrated in a few hands. Ten countries and two banking bodies control 78% of the central bank world reserves. Colombia barely has 5.8 tonnes and South Africa the main producer of gold in the world has just 125.3 tonnes.
World Official Reserves (7)
All of the countries with the largest gold reserves are the ones that most consume it. If we put the reserves to an industrial use, we would have sufficient gold for industrial needs for the next 103 years, at the 2016 rate of industrial use. If we only exploit the reserves of the countries and banking bodies in the above table there is sufficient gold for 81 years without recycling a single gram. If we include private reserves we get a figure of two and a half centuries.
Furthermore, the industrial uses are mainly for the electronics industry, computers, cell phones etc. Of the 322.5 tonnes employed in industrial processes, 254.5 were accounted for by the electronics industry. But in the same year, 1.308.5 tonnes were recycled i.e. almost four times the amount used in industrial processes and more than five times that of the electronics industry. All of this means that with what we recycle we could meet industrial needs.
That means that there is no such thing as sustainable gold; we don’t need it. These calculations not only presume that nothing is recycled, but also that in the course of the coming centuries no alternatives to gold are found or that our industrial uses are no longer relevant.
Just gold, an ideological battle
When they talk of just gold, they deceive us, it is stupid to talk of gold produced in a sustainable manner and the NGOs such as Fair Trade International are aware of this. Furthermore, the production they refer to is relatively small, but it is not an economic initiative, but rather an ideological one. The companies and their henchmen in the NGOs want to convince us that there is such a thing as just gold, a gold that we can use and exploit in a sustainable manner. The industry as such must not be questioned, nor the uses we put their products to, but rather we should back a supposedly sustainable proposal. Through this, they want to tell us that it is possible, some day, to arrive at a point of social and environmental equilibrium and consequently we should spend our time on that and not on opposition as the people of Cajamarca did. Every year the gold mining industry uses millions of kilos of cyanide (the industry itself claims to use 65,000 tonnes per year), it removes billons of tonnes of earth with all the negative consequences this has for the eco-system.
This equilibrium does not, and cannot exist. The ecological and fair trade proposals for gold, are a real-life fifth column in the environmental movement and if they are accepted, when the towns in the sights of the mining companies realise they have been deceived it will be too late. That is why we must treat these initiatives like the Corporate Responsibility initiatives, as public relations exercises that enlarge the coffers of the NGOs who promote them and demobilise the communities and absolve the companies of any blame.
The battle is not for just gold, but rather for a world without unnecessary mining. For the communities that depend on gold, it is the search for alternatives to the industry, something they will have to do, sooner or later, when the mine runs out and for the agricultural communities, total direct opposition to the arrival of the mining companies, the NGOs that support them and the ecological/just/green gold tall tale.
(1) Note for English version: This article was originally written in Spanish for El Salmón, a left wing journal in the coffee growing region of Colombia. The magazine received various threats from the paramilitaries after the massive vote against mining. It has long campaigned against Anglogold and mining in general.
(2) The information on the Better Gold campaign, the members and the mines they support comes from the official website www.swissbettergold.ch
(3) WGC (2012) Conflict-Free Gold Standard, page 1 www.gold.org
(4) For more information on the financing of paramilitary groups see HRW (2005) The Curse of Gold, HRW, New York. www.hrw.org
(6) All figures on gold production, recycling, etc are taken from the website of the World Gold Council and their document WGC (2017) Gold Demand Trends Full Year 2016 www.gold.org
(7) WGC (2017) World Official Gold Holdings www.gold.org
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