EARTHWORKS

Newmont Urged to Drop Plans for Gold Mine in Cerro Quilish, Peru

April 19, 2011

Revival of Once-Abandoned Project is 'Untenable,' Say Enviro, Human Rights Groups

WASHINGTON, DC, April 19 -- As Newmont Mining Corp. (NYSE: NEM) holds its annual general meeting today, environmental and human rights groups are demanding the company drop plans for a gold mine gold mine at Cerro Quilish, where strong community opposition blocked previous plans seven years ago.

Mass protest in 2004, the last time Newmont proposed expanding its Yanacocha mine into Cerro Quilish. Credit: GRUFIDES

" Developing Cerro Quilish is an untenable proposal, both in terms of the financial risks represented as well as the damage to Newmont's reputation and social license", said a letter to Newmont President and CEO Richard T. O'Brien from EARTHWORKS and Oxfam America.

Cerro Quilish has spiritual significance for the region's indigenous people and sits atop the water supply for the city of Cajamarca. In 2004 thousands of Cajamarcans staged protests, clashing with police and blocking access to the proposed mine site for two weeks. The company later acknowledged that community concerns had not been adequately heeded, and in 2009 adopted a "commitment to the principle of free, prior and informed consent".

But in a call with investors earlier this month, Newmont said it was again planning to mine at Cerro Quilish, would be operational by 2016. The site is estimated to hold about 4 million ounces of gold, worth almost $6 billion at current prices. Newmont owns about 51 percent of the project; Compania de Minhas Buenaventura of Lima (NYSE: BVN) owns about 44 percent, with the remainder held by the World Bank's International Finance Corp.

In the letter to O'Brien, EARTHWORKS and Oxfam America said the decision to revive the Cerro Quilish mine was "surprising and alarming" in light of " the considerable opposition of local communities to the project, the spiritual significance of the Cerro Quilish mountain to the region's residents, and the projected impacts to the critical watershed".

" We call on your company to... [establish] a concrete timeline to resolve community concerns at existing and proposed operations, greater accountability to communities, and an ongoing advisory and oversight mechanism", said the letter. "We urge Newmont to adopt a free, prior and informed consent policy, thereby enhancing your company's reputation as a true industry leader in the area of social and environmental responsibility".

Cero Quilish is four miles from Newmont's Yanococha mine, the largest gold mine in South America and second-largest in the world. The area has been marked by toxic contamination, including a 335-pound mercury spill that harmed more than 1,000 residents, and by violence and intimidation toward mining activists.

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EARTHWORKS and partners from around the world launched the "No Dirty Gold" campaign in 2004 to educate and motivate consumers and jewelry retailers to push the mining industry towards more responsible practices.

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For more information:

LETTER: Oxfam America - EARTHWORKS joint letter to Newmont re Cerro Quilish

CONTACT:

Payal Sampat, EARTHWORKS: (202) 887-1872x110

Tagged with: newmont, mining, international, indigenous, gold