On 5 May, I met with Canadian mining giant Goldcorp to talk about its San Martin mine in Honduras.
This was just one day after Goldcorp, in the lead up to its annual general meeting, published on its website that “reported net earnings from continuing operations in the first quarter of 2011 were $651 million compared to $232 million in the first quarter of 2010. Adjusted net earnings from continuing operations were $397 million, or $0.50 per share, compared to $159 million, or $0.22 per share, in the first quarter of 2010.”
Certainly such earnings seem to substantiate Goldcorp’s claim to being the “fastest growing, lowest-cost senior gold producer with operations and development projects in politically stable jurisdictions throughout the Americas”. In other words, great news for shareholders.
The thing is, I wasn’t there to discuss Goldcorp’s profits, instead I – together with CAFOD’s Honduran partner organisation CEHPRODEC and our Canadian sister agency Development and Peace – wanted to know how this claim to fastest growing and lowest cost (read highest profit margin) senior gold producer, sits alongside Goldcorp’s environmental and social responsibility record.
CAFOD has been looking at the environmental and social impact of mining for over 6 years now as CAFOD’s partner organisations from across the world have been telling us how in their experience mining can fuel conflict or pollute water sources in some of the poorest and most excluded communities.
In the case of Honduras, the people living near Goldcorp’s San Martin are small farmers whose long-term survival depends on raising animals and growing subsistence crops. When communities living downstream from the mine showed increasing concern about the water they use in the home and for farming, CAFOD commissioned international mine water management experts from Newcastle University who found evidence of pollution due to acid mine drainage.
Considering this, it was great to hear Goldcorp’s Vice President for corporate social responsibility finally say that the Newcastle University report with recommendations on how to better treat and prevent acid mine drainage (AMD) was “extremely well done” and that Goldcorp “responded to it internally”.
We were told that Goldcorp’s own environmental consultants “had the same comments and analysis” as experts Dr Jarvis and Dr Amezaga regarding the water quality. In other words, in 2008, water data for San Martin showed “typical characteristics of severe AMD” and “risks remain in relation to pollution due to AMD post-closure”.
We also welcomed Goldcorp’s openness to increase water sampling types and water monitoring frequency in order to get more certainty on the effectiveness of the AMD prevention system.
How disappointing then to hear that two weeks later at Goldcorp’s AGM, CEO Charles Jeannes – when talking about San Martin mine – did not openly acknowledge what was said to us in private: Goldcorp has to “continue monitoring to make sure [the pollution prevention system] works in the way we think it is working”.
We know that CEO Jeannes wasn’t asked explicitly about AMD in the AGM but if people in the vicinity of the mine are worried about the way in which the mine might be impacting on their health, surely it is in the company’s interest to publicly acknowledge what they are doing to prevent pollution.