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Barrick Gold Corporation ( , ) is the largest pure gold mining company in the world, with its headquarters in Torontomarker, Ontariomarker, Canadamarker; and four regional business units (RBU's) located in Australia, Africa, North America and South America. Barrick is currently undertaking mining and exploration projects in Papua New Guineamarker, the United Statesmarker, Canadamarker, Dominican Republicmarker, Australia, Perumarker, Chilemarker, Russiamarker, South Africa, Pakistanmarker, Colombiamarker, Argentinamarker and Tanzania. For 2008, it produced 7.7 million ounces of gold at a cash cost of US $443/ounce. As of December 31, 2008 its proven and probable gold mineral reserves stand at 138.5 million ounces.

On January 20, 2006, Barrick acquired a majority share of Placer Dome. The production of the combined organisation moved Barrick to its current position as the largest gold producer, ahead of Newmont Mining Corporation.

Environmental impact

Mining practices

Barrick Gold has been accused of a number of environmentally unsound practices by environmental groups. The company has countered accusations by activists, challenging the accuracy of criticisms.

Criticisms include poisonous spills of cyanide, mercury and other heavy metals, leading to environmental damage and the poisoning of human populations. Critics object to the use of gold cyanidation in the mine at Lake Cowalmarker and other gold mines, and point to the release of approximately seven tons of mercury during 2004-2005 at the Super Pit gold minemarker (a 50/50 joint venture with Newmont Mining Corporation) near the city of Kalgoorlie-Boulder, Western Australia.

Following accusations connected with the Porgera Gold Mine, on January 30 2009 the company was excluded from The Government Pension Fund of Norway, one of the world's largest Sovereign Wealth Funds. The fund's Council on Ethics in an investigation found "an unacceptable risk of contribution to ongoing and future environmental damage" at the Porgera mine:

The Council has investigated whether riverine tailings disposal from the Porgera mine in Papua New Guinea generates severe environmental damage, and finds it established that the mining operation at Porgera entails considerable pollution.
[...] In the Council’s view heavy metals contamination constitutes the biggest threat of severe and long-term environmental damage.
The Council also considers it probable that the discharge has a negative impact on the population’s life and health, including both the residents of the actual mining area and the tribal peoples who live along the river downstream of the mine.


The fund sold all its stock in the company, worth ca. 245m US$, as a result of these conclusions. A spokesman for the company disputed the allegations, saying the company was “making steady progress in improving its performance. The mine follows a government-approved environmental management and monitoring program, and we continue to operate in full compliance with legal and other requirements."

The Lake Cowal Mine was the first mine in the world certified under the International Cyanide Management Code. The code was developed jointly by the mining industry and stakeholders with the United Nations Environmental Program (UNEP) to certify management, health and safety practices in the production through third party audits. The mine site uses chromatography to “track and manage both the cyanide employed to leach the gold from its ore and the reagents subsequently added to destroy residual cyanide before discharge into the tailings dam.”

Fifteen of the company’s mines have since been certified under the code, while three Barrick operations do not use cyanide.

At the Porgera mine, Barrick has committed to pioneer a method whereby tailings products and erodible waste can be encapsulated within the coarser waste rock stockpiles. This method will ensure that the water quality of the local river systems is not compromised, without the construction of a 'normal' tailings dam, which in the rugged topography of the Porgera valley would be prone to eventual failure. . However, recent research shows that mercury can be released from gold-mine tailings encapsulated within coarser waste rock stockpiles, into the surface water through groundwater-surface water flow systems , and eventually to the atmosphere by evasion .

Relations to local populations

In April and May 2008, indigenous leaders from four countries opposing large-scale gold mining on their lands described the adverse impacts of Barrick Gold Corporation. These leaders spoke of Barrick Gold's tactics in "suppressing dissident voices, dividing communities, and manipulating local and national politics". They also related stories about "lack of free, prior and informed consent for local people". Barrick is fighting a lawsuit by the local government claiming compensation for the Marcopper Mining Disaster, which it inherited when taking over Placer Dome, Inc.

In British Columbiamarker the Tahltan Nation has expressed a contrary view, thanking the company in an open letter for encouraging local sustainable development while operating the Eskay Creek mine from 2001 to 2008.

Barrick Gold participates in a number of corporate social responsibility programs, such as the United Nations Global Compact. The company is a signatory to the Extractive Industries Transparency Initiative. It also participates in The Global Reporting Initiative, Business for Social Responsibility and The Global Business Coalition on HIV/Aids, Tuberculosis and Malaria. On September 7, 2007, Barrick was added to the Dow Jones Sustainability Index. The company is a member of The International Leadership Council (ILC) of The Nature Conservancy.

Renewable energy

In 2007, Barrick Gold installed the world's highest-situated wind turbine at the Veladero mine in San Juan Province marker at nearly 4,200m elevation.

The company has made a request to Chile’s environmental authority, COREMA, to expand a proposed wind farm project in Chile’s Region IV from ten wind turbines to eighteen wind turbines, that would generate 36 megawatts of electricity into the national power grid. In Nevada, Barrick operates a 1-megawatt solar panel farm. There are also plans to build a 9-turbine wind farm at the Golden Sunlight mine in Montana when the operation closes.

Pascua Lama project

Pascua Lamamarker is a mining project at a large and complex poly-metallic orebody in the high mountains south of Atacama on the border between Chile and Argentina. Its main product will be gold. In early 2006, the project was approved by the environmental authority in the region of Chile where the mine will be constructed. The 19-member regional environmental commission (COREMA) voted unanimously to allow the project to proceed, with conditions imposed to protect the ice fields and the water supply to the Huasco Valley. A decision to move forward with the project was deferred while sectoral permits were finalized for activity like road construction and taxation agreements between Chile and Argentina were negotiated by the two countries. In May, 2009 it was announced the project would proceed to construction.

Barrick Gold acquired the deposit with its acquisition of Lac Minerals in 1993 and has planned on investing US$1.5 billion in this project, which had a planned lifetime of at least 20 years.

The original scope of the ore body lay partially under two small glaciers which eventually feed into the rivers of the Huasco Province. Environmental reviews took place over more than two years and government authorities imposed 400 conditions on the company in order to mine. As a consequence, more than one million ounces of gold at the site will not be mined. However controversy is still rampant as to the real environmental impact, as mine exploration has already been linked to a 56 to 70 % depletion in the three glaciers nearest to the mine site.

Extensive water management infrastructure is incorporated into the mine design to mitigate the effects of surface and sub-surface water migration across the operation.

The historical record of these types of projects in Chile and the companies' real-world ability to meet legal environmental constraints makes the processing of residual-waste a point of contention. The inability or unwillingness of local authorities to stand up to spills and breaches of environmental requirements is well known and another key point of disagreement with opponents to the project.

The recent approval (as of 2000-2009, during the Lagos and Bachelet presidecies ) of many controversial projects such as large mines, dams for power generation, huge salmon farms, forestry, etc. in spite of many legal and environmental concerns, again question the ability or willingness of the Chilean Government to address local communities concerns' when clashing with large corporations and perceived economic benefits .

These issues have recently even been criticized by the OECD as major impediments for Chile being able to join the 'elite club' of developed countries.

Low levels of residual ore processing waste products, such as sodium cyanide and sulphuric acid will be treated and neutralised on site, then discharged into the local water systems, providing the residual levels meet the legislative requirements of the Chilean governing bodies. A strict regime of monitoring is included in the operating license.

The mine’s opponents in Chile include the Diaguita Huascoaltinos Indigenous group and Alto del Carmen councilperson Luís Faura Cortes, who fear that the mine will damage the agriculture industry in the Huasco Valley.

In a Chilean court case over title ownership between Barrick Gold and a mining trustee named Rodolfo Villar, employee of the alleged owner Jorge Lopehandia, there was a verdict passed down declaring that Lopehandia was the rightful owner of the mining claims that comprise the Pascua Llama project. Barrick Gold proceeded to sue the Judge claiming that the Judge was biased, and therefor the Judgement should be overturned. This case was elevated to the Chilean supreme court level where it was declared that the Judge's decision was the correct one.

NovaGold and Pioneer plays

On July 24, 2006, Barrick announced their intent to purchase NovaGold Resources and Pioneer Metals. The unsolicited bid for NovaGold Resources was at US $1.29 billion or US $14.50 per share, and the solicited bid for Pioneer Metals was at US $53 million or US $.88 per share. NovaGold management quickly characterized Barrick's bid for their company as undervalued. Pioneer management however quickly endorsed Barrick's bid for their company. Previously on June 19, 2006, NovaGold made an unsolicited bid for Pioneer Metals at US $31 million. NovaGold and Pioneer are currently in litigation over the Grace project in British Columbia, Canada. That project is adjacent to NovaGold's Galore Creek project and 75 kilometers away from Barrick's Eskay Creek mine. NovaGold and Barrick also cross paths at the Donlin Creek project in Alaska where NovaGold is 70% owner and Barrick is 30% owner, however Barrick has the right to earn in a 70% share as a result of their takeover of Placer Dome in January 2006.

On August 14, 2006, NovaGold filed a lawsuit in British Columbia, Canadamarker alleging that Barrick misused confidential information to make its bid for Pioneer metals. [78869] As part of the suit, NovaGold is asking that any shares tendered to Barrick under the Pioneer bid be held in a trust for NovaGold. On August 25, 2006, NovaGold filed a second lawsuit against Barrick [78870] - this time in the District of Alaska court alleging that Barrick violated U.S. security laws by misrepresenting its position by repeatedly stating it is on-track to earn a 70% interest in the Donlin Creek mine. The suit seeks a temporary suspension of Barrick's hostile bid for NovaGold.

On December 16, 2006, after extending the bid for NovaGold 6 times, increasing the offer once, and lowering the threshold for takeup of tendered shares from 75% to 50%, and then to no minimum, Barrick finally let the bid expire [78871]. The net result for Barrick was a takeup of 12.7% of the outstanding NovaGold shares. Barrick's Chief Executive Greg Wilkins indicated that the company would look elsewhere for acquisition opportunities. More recently, the company is reported to be eyeing Aurelian Resources [78872] in Ecuador.

In November 2007, NovaGold and Teck Cominco announced the suspension of Galore Creek project and Nova Gold share plummeted. During the summer and Autumn of 2008, Nova Gold tried to put their Rock Creek project in Alaska into production. After less than two months of operation, production was shut down for obscure reasons. On January 2, 2009, Nova Gold announced a 60 million dollar private placement for a 30% control in the company, valuing the company at approximately 200 millions dollars, or 1/8 of the price offered by Barrick two years earlier.

See also



References

  1. CorpWatch : Barrick Gold Mine Transforms Pacific Island
  2. Jantzi Research - Alerts
  3. Business & Human Rights, “The Facts & CorpWatch” - Author: Barrick Gold Dated: 11 May 2007, http://www.business-humanrights.org/Links/Repository/136222/link_page_view
  4. Norwegian Ministry of Finance (2009-010-30) Mining Company Excluded from the Government Pension Fund – Global doe to contribution to serious environmental damage (in English) http://www.regjeringen.no/en/dep/fin/press-center/Press-releases/2009/mining-company-excluded-from-the-governm.html?id=543107
  5. International Cyanide Institute, Press Release: 'First Operation Certified Under International Cyanide Management Code’, Washington, D.C., April 17, 2006 http://www.cyanidecode.org/media_pr6.php
  6. International Cyanide Management Code for the Gold Mining Industry web site, [1]
  7. Tim Thwaites, “Single Analysis solution tracks cyanide”,Commonwealth Scientific and Industrial Research Organisation’s Process magazine, Jan 2009
  8. http://www.cyanidecode.org/signatory_barrickgold.php
  9. http://linkinghub.elsevier.com/retrieve/pii/S0883292706002095
  10. Maprani et.al.,(2005),http://pubs.acs.org/doi/abs/10.1021/es048962j
  11. "Global resistance to mining", Chain Reaction, Issue #103, September 2008, p. 16.
  12. “Breaking New Ground: Mining, Minerals and Sustainable Development”, Linda Starke (Editor), Earthscan Publications Ltd. (February 2003), P. 347 & 348 and Sedar website, Placer Dome Inc., “Placer Dome Speaks to Philippine Lawsuit”, news release, October 6, 2005 http://www.sedar.com/ (at 6 Mar 2009)
  13. [2] Stepping Stone Fall 2008 p.2
  14. United Nations Global Compact web site http://www.unglobalcompact.org/ParticipantsAndStakeholders/search_participant.html?detail=Barrick+Gold+Corporation
  15. http://eitransparency.org/supporters/companies
  16. http://www.bsr.org/membership/member-list.cfm
  17. Global Business Coalition on HIV/AIDS, Malaria and Tuberculosis Member Profiles http://www.gbcimpact.org/itcs_type/9/507/member_profiles
  18. CSRwire
  19. http://www.nature.org/joinanddonate/corporatepartnerships/leadership/
  20. Reuters, Industrial Info News Alert, ‘Barrick Awaiting Approval for Expansion of Punta Colorada Wind Project’ 25 June 2008 http://www.reuters.com/article/pressRelease/idUS120359+25-Jun-2008+MW20080625 (Mar 4, 2009) and Reuters, Industrial Info News Alert, ‘Preliminary Earthwork Begins for Phase I of Punta Colorada Windfarm in Chile’, 19 Aug 2008 http://www.reuters.com/article/pressRelease/idUS103425+19-Aug-2008+MW20080819 (Mar 4, 2009)
  21. John Seelmeyer, Northern Nevada Business Weekly, ‘Barrick Gold nearly done with major solar facility’, 14 Jan, 2008 http://www.nnbw.biz/ArticleRead.aspx?storyID=10316 1/14/2008
  22. Nick Gevock, The Montana Standard, "Wind Farm Planned for Golden Sunlight Mine Land," The Montana Standard, 9 Sep 2008, http://www.istockanalyst.com/article/viewiStockNews/articleid/2596197 (@ 6 Mar 2009)
  23. Wanda Prassmsma, The Santiago Times, “Chile Gives Pascua Lama Conditional Green Light” February 16, 2006. http://www.santiagotimes.cl/santiagotimes/index2.php?option=com_content&do_pdf=1&id=8603 and Andy Hoffman, The Globe & Mail, “Argentina approves Barrick Gold Mine”, 6 December, 2006 http://www.theglobeandmail.com/servlet/Page/document/v5/content/subscribe?user_URL=http://www.theglobeandmail.com%2Fservlet%2Fstory%2FLAC.20061206.BARRICK06%2FTPStory%2F%3Fquery%3DBarrick%2BAndy%2BHoffman&ord=87623261&brand=theglobeandmail&force_login=true
  24. Pav Jordan, Reuters, “Barren Chile Andes hide world class gold play” March 2, 2007, http://www.reuters.com/article/companyNewsAndPR/idUSN0234972120070302
  25. Pav Jordan, Reuters, “Chile, Argentina nearing Pascua Lama tax deal”, January 29, 2009 http://uk.reuters.com/article/tnBasicIndustries-SP/idUKN2931258920090129?sp=true
  26. http://www.marketresearch.com/product/display.asp?productid=2299819&g=1
  27. Andy Hoffman, The Globe & Mail, “Argentina approves Barrick Gold Mine”, 6 December, 2006 http://www.theglobeandmail.com/servlet/Page/document/v5/content/subscribe?user_URL=http://www.theglobeandmail.com%2Fservlet%2Fstory%2FLAC.20061206.BARRICK06%2FTPStory%2F%3Fquery%3DBarrick%2BAndy%2BHoffman&ord=87623261&brand=theglobeandmail&force_login=true
  28. Reuters, “Barrick hopes to start work on Pascua Lama in September” Thu Mar 1, 2007, http://www.reuters.com/article/companyNewsAndPR/idUSN0132813220070301
  29. Paul Harris, ‘Where is ice worth 1.3 million ounces of gold? Ask Barrick”, American Metal Market, 30 Mar 2007
  30. Ricardo Lagos, http://en.wikipedia.org/wiki/Ricardo_Lagos and Michelle Bachelet, http://en.wikipedia.org/wiki/Michelle_Bachelet
  31. Environmental Issues in Southern Chile, http://www.allsouthernchile.com/southern-chile-environmental-issues.html
  32. Chile, Environmental Problems May Impede Entry to OECD, http://goliath.ecnext.com/coms2/gi_0199-7489056/CHILE-ENVIRONMENTAL-PROBLEMS-MAY-IMPEDE.html
  33. http://cl.invertia.com/noticias/noticia.aspx?idNoticia=200812090959_INV_77678850&idtel=
  34. http://www.chanarcillo.cl/articulos_ver.php?id=8401
  35. NovaGold Website


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