Conga Mine in Peru Halted By Water Concerns, Civic Opposition – by Brett Walton (Circle of Blue – April 21, 2016)

Newmont Mining, the world’s second-largest gold producer, announced in a U.S. financial filing that it is abandoning a $US 4.8 billion copper and gold mine in Peru “for the foreseeable future.”

“Newmont will not proceed with the full development of Conga without social acceptance, solid project economics and potentially another partner to help defray costs and risk; it is currently difficult to predict when or whether such events may occur,” the company wrote in a U.S. Securities and Exchange Commission filing on February 17. “Under the current social and political environment, the company does not anticipate being able to develop Conga for the foreseeable future.”

While Newmont’s decision is partly in response to souring market conditions — the price of copper is down more than 50 percent since a 2011 peak — the withdrawal from Conga is also a recognition that environmental concerns pose a serious financial risk to business. The mine was strongly opposed by Andes farmers because four natural lakes would have been drained and replaced by manmade reservoirs.

Mining, more than most industries, is tied to water. Water is used to mine and process the ore. The chemicals that separate metal from ore can spill and taint rivers and groundwater. Tailings dams that soar to the height of skyscrapers impound a sludge of toxic metals that can bury and poison a stream. A blunder by any company at any step leaves a black mark on the industry. Companies are now paying attention.

“Water is more and more on the agenda for mining companies,” Nicolas Maennling, a policy researcher at the Columbia Center on Sustainable Investment, told Circle of Blue. “The work around that topic has seen increased interest partly because of tailings dam failures and also because social pressure has increased to a level where mines have stopped operations or a project does not go ahead at all.”

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