The High Cost Of Gold

The High Cost Of Gold

Yanacocha, like most modern gold mines, uses a process called cyanide-heap leaching to extract tiny bits of ore from rock. Mining engineers begin by blasting apart hills and other formations, creating deep pits. Pit mining graphic Each truckload that leaves the pit contains roughly 180 tons of rock and dirt — and about 8.5 ounces of gold. Nitrates from explosives used in blasting can wash into streams.
To the peasant farmers, the campesinos, the cause of the contamination is evident. The hills contain flecks of gold ore, one of the rarest minerals on Earth. And for 22 years, the American company Newmont Mining Corp., with financing from the business-lending arm of the World Bank, has blasted apart hills and used toxic chemicals to get it out.
Rock is dumped into a water-tight pond, flattened and sprayed with a cyanide solution that dissolves trace of amounts of gold. The solution of gold and cyanide drains into a staging reservoir.
Engineers mix the gold-cyanide solution with carbon, which bonds with the gold particles.An acidic solution — generally hydrochloric acid — is used to separate the gold from the carbon.The gold-laden liquid is poured over electrified steel, which attracts flakes of the metal. Heavy metals are a byproduct of refinement. In 2000, a cask of mercury leaked in transit from the Yanacocha mine, sickening nearly 1,000 people. Engineers heat the gold-plated steel to temperatures exceeding 1,000 degrees Fahrenheit — hot enough to melt the gold but not the steel.
The gold mine, Yanacocha, is a massive operation, sprawling across hundreds of square miles at elevations as high as 13,000 feet. The International Finance Corp., part of the World Bank Group, provided loans to help build and expand the mine and owns a small stake in it.
Since 1993, Yanacocha has yielded more than 35 million ounces of gold. It is the largest gold mine in South America and one of the most productive in the world.
The extraction has proved a boon to Peru’s chronically underfunded central government. Yanacocha has contributed $2.75 billion in tax revenue and royalties since operations began, according to the company. But on the farms and in the villages nearest the mine, poverty remains an unsolved scourge and antipathy toward Yanacocha runs high.
Mercury that spilled off a truck 15 years ago sickened hundreds of residents of three nearby towns. Studies have shown that heavy metals from the mine have leaked out, in a place where many people already don’t have access to clean water. Local farmers are keenly worried about their own health, and that of their families.
“If our animals are dying as a result of contaminated water, what about us?” asked Felipe Flores, Elvira’s uncle.
‘Do No harm’

There’s nothing unusual about an industrial mining operation with a spotty environmental record. But projects backed with money from a World Bank Group institution are supposed to follow a higher standard.
The World Bank Group finances economic development projects in poor, often unstable countries in pursuit of a lofty ambition: ending global poverty. Borrowers that accept a loan from the World Bank, which lends to governments, or the IFC, which lends to companies, must follow detailed rules for protecting people and the environment, under an approach they describe as “do no harm.”
“IFC is committed to ensuring that the costs of economic development do not fall disproportionately on those who are poor or vulnerable, that the environment is not degraded in the process and that renewable natural resources are managed sustainably,” the lender said in a 2012 update to its sustainability policy.


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