Gold Campaign | Coalition | Cyanide | Lake Cowal |
Rainforest Information Centre

prepared by the Rainforest Information Centre ~ (02) 66218505
October, 2004 / Last updated: July 24, 2005

1) Montana - a 1998 citizen's initiative passed that banned open-pit cyanide leaching in gold and silver mining at new mines and mine expansions.

2) Colorado - five counties have banned cyanide heap leach mining. In January 27, 2004, Commissioners in Summit County voted for the ban to protect the future public health and safety from the controversial mining process and chemicals.

3) Wisconsin - November 5, 2001-- The Wisconsin State Senate approved two mining-related environmental bills by votes of 19-14: Senate Bill 160 to ban cyanide use in all Wisconsin mines, and Senate Bill 271 to have "No Special Treatment" for the mining industry. The bills now go to the State Assembly for consideration.

4) Turkey - In 1997 the Turkish Council of State decided not to allow gold production through cyanide leaching, on the basis of article 56 of the Turkish Constitution which guarantees the right of people to live in a healthy environment (nr. 1996/5348, decision nr. 1997/2311).

5) Turkey - The European Parliament of November 17 1994 ruled against gold mining near Pergamon and Adramyttion, Turkey (ABL C 341, December 5 1994, page 169).

6) Honduras - In March 2001, Seventy-five people representing 15 communities located adjacent to 8 mines attended a meeting in Honduras to launch a national anti-mining campaign called "Honduras Is Worth More Than Gold." The meeting took place on March 9 and put forward several goals, including the prohibition of the use of cyanide in mining operations, the prohibition the expropriation of campesino and indigenous lands, and the strengthening of mining and environmental laws.

7) Czech Republic - The Czech Senate of August 2002 and the Czech Parliament, of September 2000 made decisions to forbid gold production through cyanide leaching in the Czech Republic domain (Mining Law of 1991, article 30, paragraph

8) Argentina, February 9 2003 - The Esquel City Council passed ordinances that ban the use and transport of cyanide within city limits, revoke the city ordinance accepting national laws on mining investment, and call for a popular referendum on the mine to be held by March 23 at latest, six days before the oft-postponed public hearing on the issue was scheduled to take place. Chubut Province passed a moratorium on open-pit cyanide-leach mining in 2003.

9) Germany passed a decree in 2002 prohibiting cyanide-leach mining.

10) Greece has ruled against a number of gold mining projects.

11) Costa Rica passed a moratorium on open-pit cyanide-leach mining in 2002.

12) Peru, September 8 2004- Some 4,000 Peruvians stopped work and marched through the northern town of Cajamarca on Wednesday, demanding a ban on a gold exploration project they say is contaminating and drying up their water supplies. The strike shut down banks, markets and public transportation in Cajamarca, 535 miles (856 km) northeast of Lima. Earlier in the week farmers and residents blocked roads to protest exploration of the Cerro Quilish deposit by

13) The European Union's "Baia Mare Task Force" recommended that cyanide and other toxic substances contained in tailings from the production process be removed before disposal and that waste disposal facilities and tailings ponds of inadequate capacity or lacking emergency drainage systems for excess water be forbidden. (Report of the International Task Force Assessing the Baia Mare Accident, presented in Brussels, on December 15, 2000).

14) Philippine island province of Oriental Mindroro placed a 25 year moratorium on all mining projects in the region in April 2002.

15) In January, 2005 in response to mining threats, Alaskan Village and Traditional Councils as well as Village Corporations began to pass strong resolutions in opposition to mines that they believe are a) environmentally unsound b) foreign owned c) in conflict with their desired future vision for their communities and d) a threat to their traditional lifeways.

16) Rio Negro Legislature chamber (July 21 2005,) The legislature of Argentina's southern province of Río Negro has passed a bill banning cyanide and mercury use in metallic minerals mining, production and industrialization. Source in spanish:

Move for 50-year Marinduque mining moratorium hailed
By Katherine Adraneda
The Philippine Star 11/01/2005

Environmental advocates yesterday hailed the move of the Marinduque provincial council to adopt a resolution of a Church-based organization seeking a 50-year mining moratorium in the province.

Defend Patrimony, a broad alliance of environmental groups and mining-affected people, believes that the resolution of the Marinduque Council for Environmental Concerns (MACEC) is a big blow to the mining liberalization program of the government.

MACEC’s resolution, which also condemned the Supreme Court’s decision reversing the unconstitutionality of some provisions of the Philippine Mining Act of 1995, was adopted by the Sangguniang Panlalawigan of Marinduque on Oct. 28.

“President Arroyo and the Department of Environment and Natural Resources have been trying to re-open large-scale mining in the island despite the environmental devastation and suffering of the many victims of the 30-year disaster and the demands of Marinduqueños to stop large-scale mining in the province,” said Clemente Bautista Jr., convenor of Defend Patrimony, an active campaigner against the government’s mining liberalization program.

According to Bautista, the administration is even dangling the $1-billion San Antonio Copper Mine Project to foreign mining corporations.

The 764-hectare San Antonio mine area is under the Mineral Sharing Production Agreement (MPSA) of the Marcopper Mining Corp., a major partner of Placer Dome Inc. (PDI).

It is one of the 24 priority mining projects of the Arroyo administration, which was projected to generate $100 million in investments.

“People’s actions can raise the level of this victory by pressing the provincial government to transform the resolution into an ordinance, as what the provincial governments of Capiz and Mindoro Oriental have done in 1999 and 2002, respectively,” Bautista said.

“This way, we can seal the issue of re-opening the mines to foreign mining corporations in Marinduque,” he added.

Last week, MACEC executive secretary Myke Magalang articulated before the provincial board the resolution of the organization calling for a mining moratorium.
Magalang submitted before the provincial board 15,500 signatures of Marinduqueños, opposing the resumption of mining operations in the province.

The MACEC also submitted to the Sangguniang Panlalawigan the Pastoral Letter of Bishop Reynaldo Evangelista, D.D. and resolutions from the Sangguniang Bayan of Boac, Mogpog, Gasan, Buenavista, and Torrijos, which all vehemently oppose the re-entry of mining companies in Marinduque.

It was likewise proposed under the MACEC resolution that the abandoned mining area previously managed by Marcopper Mining Corp. be declared as a provincial special economic zone in order to effectively implement the spirit and intent of a 50-year mining-free policy in the province.

According to MACEC, certain portions of the Central Marinduque Area should be declared as provincial special agricultural zone, special biodiversity protected area, special eco-tourism zone, and other special areas as may be determined by an appropriate provincial land use policy in order to strengthen such legislation.

“Our people are still agonizing. Our rivers and the surrounding seas remain poisoned and polluted. The people, especially women and children are reeling from toxic diseases and illnesses brought by irresponsible mining operations,” Magalang pointed out.

“Worse, there is still the imminent disaster posed by the unstable mining structures left by Marcopper-PDI and the government,” he added.

Source: "Crónica Newspaper", 10.24.2005
ARGENTINA: Impelling law to prohibit mining with cyanide.

A project of national law that would prohibit the mining activity in all the country by means of leaching techniques with cyanide use or other toxic substances will begin to impel itself from the beginning of this week, from the experiences gathered in different points from the country, in as much today a strong controversy in Pascaua Lama mine specially (San Juan Province) and by the happened thing in the chubutense city of Esquel exists.

Initiative, that is impelled by the deputy of "Self-determination and Freedom Party", Luis Zamora, counted on support and advising for elaboraciòn of lawyer Cristian Hendrickse, which it made a work of investigation in Esquel and has an active roll in the fights who comes developing against toxic mining, according to stands out between the foundations of the project.

Also one scores to eliminate the incentives the mining law, that were created in the decade of the 90 at national level and were absorbed in Chubut Province through specific norms. On the other hand, this same type of incentives is the one that demands the oil industry today to return to invest in exploration.

The initiative counts on the support of the organization RACHA (Resistance Antimining Lonko -Chief- Chakayal), that has invited to the ONGs and organizations in general to send itself in support to the project.

In his essential articles, it prohibits in the territory of the Argentine Republic the use in the mining activities of leaching techniques with cyanide or other toxic substances.

The violation to that norm, according to the second article, would have to be sanctioned with fine whose minimum will be the equivalent one in weights to the value
of 100 ounces of gold and whose maximum will be the equivalent one in weights to the value of 10,000 ounces of gold, without damage of the repair of the environmental damages that had possibly taken place, the obligation to support the costs by leisure, transfer and demolition, the closing and the responsibilities civil or criminal that corresponded.

"A the effects of this Law - the transmission or abandonment of the property or other rights on the objects or substances used in nobodies of the activities say the
third article is not oponible prohibidas".

It extends responsibilities to those are owners from any mining right relative to the place of commission of the infraction, or the associate by joint venture or any
contract of mining object, like those who at the time of committing the infraction have to their position the direction, administration or management of the legal person the condemned, will be personal and shared in common responsible for the sanctions established in the present ley".

The initiative, according to its author, tends "a to guarantee the rights to the life, the health and the work of the inhabitants of this country, its environment and its
resources, like thus also the right of self-determination of the Argentine people. He has as objective to support the fight of all those that come facing the mining projects and the governmental complicity them as well as stimulating that that determined opposition and signs he extends and he is supported by all the peoples and to articulate with similar fights that come freeing the brothers peoples of
Latin America".

Caem: Gold mining cannot advance in Río Negro - Argentina Wednesday, July 27, 2005 19:00 (GMT -0400)

Argentina's mining investors chamber Caem believes gold mining cannot be carried out in the country's southern province of Río Negro due to the province's decision to ban the use of cyanide and mercury.

"In this particular case, due to the type of mineralization in the province, telling [companies] they cannot use cyanide is like telling them they cannot mine," Caem general manager Víctor Di Meglio told BNamericas.

Miners need to use cyanide to make gold mining profitable in Río Negro and until the law is revoked, there will be no mining development, the official said.

Río Negro's decision was based on a political factors which did not take into account other gold mining projects in Argentina like Swiss company Xstrata's (LSE: XTA) Alumbrera gold-copper mine, he added.


Regarding lawsuites that could be filed against the province, Di Meglio believes companies "will not just sit and do nothing as this is a matter of legal security."

The decision by Río Negro's authorities violates a national law - the mining investment law - so now the provincial decision must be studied to determine what actions can be taken, the official said.

Caem will not sit on the sidelines but support all actions taken by miners as companies are the ones that must react given their interest in the matter, he added.

Canadian junior Aquiline Resources (TSX-V: AQI) could be impacted by the law considering it operates the Calcatreu gold project in the province.

Company officials have not yet responded to BNamericas' request for comments on the issue.

By Harvey Beltrán


Río Negro passes bill banning cyanide use - Argentina
Thursday, July 21, 2005 18:54 (GMT -0400)

The legislature of Argentina's southern province of Río Negro has passed a bill banning cyanide and mercury use in metallic minerals mining, production and industrialization.

After hours of discussions, the legislation was approved, with 38 lawmakers voting in favor and three representatives of the 17 de Noviembre party against, the province legislature said in a statement.

"With the new law advanced by governor Miguel Saiz, companies or individuals who own first category mineral deposit concessions or those who industrialize the minerals must adapt their processes to the new regulation," the statement said.

The law was approved despite efforts by a group of opposition lawmakers who proposed that international quality certification ISO 14001 be required for mining activities using cyanide.

Now that the law has been enacted as planned by the province's executive branch, "there will be suits filed because companies will claim the right to the protection the mining code entitles them to," federal mining director Miguel Ángel Guerrero said previously.

Central government authorities have been trying to convince the province to analyze its proposal in depth as some believe this is a case of the latter trying to impose a regulation not included in national law.

Press Release 8 July 2005: NGO Forum for Protected Forests - (JATAM, WALHI, ICEL, HuMA, ELSAM, YLBHI, LBH Jakarta Pokja PA PSDA, AMAN, TAPAL)

Constitutional Court rules six mining companies still prohibited from open pit mining in protected forests

Jakarta, 8 July 2005 According to yesterday‚s Constitutional Court ruling, of the 13 companies listed in the Presidential decree on mining in protected forests, the six companies which are only at the stage of exploration or feasibility study are still required to adhere to clause 38 (4) of the Forestry Law. The ruling means that these 6 companies (listed below) are still prohibited from open pit mining in protected areas. However, the Constitutional Court declined an Indonesian NGO request to annul the entire Presidential Decree and subsequent amendment to the Forestry Law, ruling that the remaining 7 companies which have already entered the exploitation phase in protected forests may continue with open pit mining.
"This Court concurs with the opinion of expert witness Prof. Dr. Emil Salim ... that the six companies which are still at the stage of exploration or feasability studies, at such time as they enter the exploitation stage must comply with the requirements in Clause 38 (4) of the Forestry Law (41/1999) [which prohibits open pit mining in protected forests] as long as their licences for exploration and exploitation are not a combined licence" (quoted from the conclusions at pp 414-415 of the Judgement of the Constitutional Court).

Under the Indonesian mining law framework, a Contract of Work (CoW) is granted to a mining company to exclude others from mining in a certain area, however a CoW holder only gains a licence for exploitation once their mining plan and Environment Impact Assessment recieves government approval. The practical outcome is that the six companies prohibited from open pit mining in protected forests are those which have not had reached that exploitation stage through submitting a plan and having their EIS approved:
Weda Bay Nickel (Canada), Gag Nickel (BHP Billiton from UK/Australia), Pelsart Tambang Kencana (Australia), Aneka Tambang (Indonesia), Sorikmas Mining (Aberfoyle from Australia), and Interex Sacra Raya (Indonesia).
"Transnational mining companies such as BHP Billiton have nothing to celebrate. The Constitutional Court ruling stresses to the government, especially the Minerals and Energy Department, that open pit mining in protected forests is still prohibited for all but the seven companies that have already begun exploitation" said Siti Maimunah, National Coordianator of the Mining Advocacy Network, JATAM.

The Constitional Court decision handed down on 7 July 2005 on the one hand recognises the huge impact on communities and the environment of open pit mining, but on the other hand makes an exception for seven companies to continue with such mining in protected forests. To be consistent with the evidence brought by the appellants, the Court should have annulled the Presidential Decree (and ratification) because it endangers the livelihoods of many and thus contravenes clause 33 (3) of the Indonesian Constitution. Nevertheless, the Court chose the road of compromise:

"Although this Court shares the opinion of all the experts brought by the appellants regarding the dangerousness and negative impacts of open pit mining in protected forests, nevertheless this Court also understands the reasoning for the need for a transitional regulation which continues the rights or legal status gained by mining companies before the advent of the Forestry Law (1999)." (quoted from the conclusions at pp 413-414 of the Judgement of the Constitutional Court).

The Indonesian Constitution requires that Presidential Decrees only be issued in conditions of pressing national crisis, "kegentingan yang memaksa", but the judges concluded that this is a subjective test at the discretion of the President, whilst recommending that in future, the President must consider more objective conditions before issuing further Decrees.

"This is a dangerous precedent. The impact is that the President may in future often use the Presidential Decree mechanism to steamroll forward with developments having large impacts on many people's livelihoods," said Chalid Muhammad, Director of WALHI, Indonesian Forum for Environment.

Indro Sugianto, Director of the Indonesian Center for Environmental Law concluded „Remember, with this Constitional ruling, no other companies outside the seven which have already begun may conduct open pit mining in protected forests. The government and mining industry must respect and comply with this judgement" [ends]

Chalid Muhammad (WALHI) : +62 811 847 163
Siti Maimunah (JATAM) : +62 811 920 462
Indro Sugianto (ICEL) : +62 815 943 4228

Río Negro legislature set to ban cyanide, mercury - Argentina
Published: Thursday, June 23, 2005 15:54 (GMT -0400)

There is total agreement in the legislative chamber of southern Argentina's Río Negro province on approving a measure to ban the development of mining projects that use substances such as cyanide and mercury.

"The decision to vote in favor of the bill will be unanimous, given that the government bloc has the majority of votes while the opposition - who number just six - already expressed their rejection of cyanide or mercury in mining projects," Alberto Ricaldoni, a press official for Río Negro's legislature, told BNamericas.

The measure, which will be discussed and voted on in the chamber on June 30, "has already been signed by the governor [Miguel Saiz] and ratified by all the [province's] ministers so it will need just one reading [debate and vote] in the provincial legislature," Ricaldoni said.

The Río Negro legislature has only one chamber, rather than a lower and upper house, and bills are normally subject to two rounds of voting. However, in this particular case the bill will be discussed only once as the ministers have already approved it.

Once voting is completed the executive will have 48 hours to promulgate the measure. "It's in their interests to sign it as quickly as possible as they backed it," Ricaldoni said.

Once promulgated the law would oblige companies that hold mineral concessions in the province to adapt their development processes to the new legislation.

When governor Saiz presented the bill he said the initiative "results from my analysis related to recent phenomena in our province regarding increasing permit requests for sampling, exploration and development of metallic mineral deposits."

Saiz recently announced his rejection of the environmental impact study (EIS) for Canadian junior Aquiline Resources' (TSX-V: AQI) Calcatreu gold project in Río Negro on the grounds that cyanide would be used in the extraction process.

Aquiline has been planning to invest US$43.5mn at Calcatreu to produce 97,000oz/y gold and 580,000oz/y silver at average cash costs of US$191/oz over the first four of the seven-year mine life, according to the company.

In an interview with BNamericas earlier this month, Aquiline VP of exploration Martin Walter said the governor's rejection of the project was related to upcoming elections.

Congressional and provincial elections are to be held in Argentina this October, although Saiz himself is due to serve until December 2007 and only two national and no provincial deputies are up for reelection in Río Negro this year.

By Harvey Beltrán

High court upholds cyanide ban
By Bob Anez, Associated Press Writer, Great Falls Tribune
9th June 2005

Helena - Montana's 7-year-old ban on using cyanide in gold mining did not violate the constitutional property rights of a company hoping to develop an open-pit mine near Lincoln, a unanimous Montana Supreme Court ruled Wednesday.

The fact that Canyon Resources Corp.'s Seven-Up Pete Joint Venture just had the chance to develop state mineral leases for its mine did not give it a property right that could be taken away by passage of the ban, the justices said.

"We conclude, therefore, that the Venture's opportunity to seek a (state) permit, which required convincing the state that this cyanide leaching project was appropriate, did not constitute a property right," the court held. "The state had wide discretion to reject the Venture's permit application, even without enactment of I-137."

The ruling, which upheld a district judge's findings, did not resolve all the legal battles over voters' passage of Initiative 137 in the 1998 general election. Several federal court cases raising the same issue settled by the state's high court are pending.

But the Supreme Court's decision does lay to rest claims under the Montana Constitution, which prohibits the taking of personal property without compensation. Canyon Resources had argued that is what the cyanide ban did in halting plans for its gold mine.

A spokesman for the leading environmental group behind I-137 applauded the court's decision.

"It is quite clear that Montanans have a right to make laws to protect their water and air, and that doing so does not result in a loss of private property rights, especially when there is no private property right to begin with," said Jim Jensen, executive director of the Montana Environmental Information Center.

Jim Hesketh, president and chief executive officer of Canyon Resources, said he had not seen the ruling. But he did say the outcome was not surprising.

"It's been pretty tough to get a fair shake up there on any of this," he said.

Attorney General Mike McGrath agreed the ruling was no shocker, given Canyon Resources' legal stand.

"Their argument was fairly extreme, probably beyond the far edge of acceptable jurisprudence," he said. "So the opinion is not particularly surprising. It coincides with mainstream thinking across the country."

McGrath also said the ruling should prompt the company to abandon their federal claims. "My hope is that they will fold their tent. They will not have a stronger case in federal court than they had in state court."

Canyon Resources, a Colorado-based company, had argued that it acquired a property right to mine the land when it obtained mineral leases on state land and that its property - the value of the leases - was illegally taken away when the initiative rendered them worthless.

The company said it spent $70 million in developing the project since 1989 and tens of millions more were lost by being unable to mine the claim. It wanted to be paid for loss of the project. Although the lawsuit did not specify an amount, company officials said it could be $500 million.

The state contended the company had no operating permit to mine using cyanide when the ban was enacted so it had no property right that could be taken away by the initiative.

The Supreme Court agreed, saying someone cannot claim loss of a property right never possessed.

On another issue, the justices found I-137 did impair a "contractual relationship" between the state and mining company based on the assumption that cyanide would be used at the mine to separate gold from ore. But the result was not a violation of the constitution, because the ban was "based on the significant and legitimate public purpose of protecting the environment," Justice Jim Rice wrote for the court.

Given the concerns about risks involved in using cyanide in mining and the adequacy of existing laws, "we conclude that the state could legitimately determine that this method of mining required strict regulation, and that I-137 was reasonably related to that legitimate purpose," he said. Justice Brian Morris, who was state solicitor when he defended the law before the court in October 2003, did not participate in the decision.

Canyon Resources has had recent financial problems, losing $17.4 million last year as its stock price plummeted from $5.12 in January 2004 to 79 cents as of Wednesday.

The company spent about $3.5 million last year to promote a failed ballot measure repealing the cyanide ban.

Voters refuse to relax cyanide mining restriction
By SUSAN GALLAGHER - Nov 2, 2004, Associated Press

HELENA -- Montana's ban on use of cyanide technology in new gold and silver mining withstood a challenge by the mining industry in the election Tuesday.
Voters refused to reverse the ban as the industry wanted in Initiative 147. With 522 of 881 precincts reporting, the vote was 153,080 against overturning the ban voters approved six years ago, to 104,374 in favor, or 59 percent to 41 percent.

"It's a sad day for the American mining industry and the future economy of Montana," said Tim Smith, manager of a Jefferson County gold mine and member of a campaign committee that backed I-147. "The environmentalists did it again, using scare tactics."

But Paul Roos of Ovando, treasurer of a group that fought I-147, said voters made "the right decision for clean drinking water and our rivers, and for our economy."
Use of cyanide to separate gold and silver from rock may be "all right in a state where there's no water," Roos said. "It's proven that it doesn't work here."

Supporters of Initiative 147 touted it as a way to tell the North American mining industry, with its high-paying jobs, that Montana is open for business. Opponents said passage would leave the state vulnerable to catastrophic water pollution.

The few places where I-147 drew a substantial lead included Butte-Silver Bow and Jefferson counties, both of which have operating mines. With 40 of 47 precincts reporting, the Butte-Silver Bow vote was 5,012 in favor of ending the ban to 2,095 opposed. In Jefferson County, with 11 of 14 precincts reporting, the vote was 3,574 to 2,164.

The process at issue involves rinsing piles of crushed rock with cyanide, a potent chemical that percolates through the rock and draws out small deposits of gold or silver. Voters in 1998 passed an initiative banning that process.

The measure decided Tuesday stirred strong emotions in Montana and brought major financial support from Colorado-based Canyon Resources Corp. The campaign organization supporting I-147 received at least $2.2 million in cash and contributions from Canyon Resources, more than four times the contributions to campaign groups fighting the initiative.

The company wanted to develop a cyanide gold mine near western Montana's Blackfoot River, but plans came to a halt when voters passed the ban six years ago.

During the campaign to pass I-147, Canyon Resources said it still aimed to develop the mine and projected 14 years of metal production, with employment spanning at least 20 years.

Among the states, only Montana banned the cyanide process, said Warren McCulloch, an administrator in the Montana Department of Environmental Quality.

Three major mines in the state used the cyanide process before the 1998 ban, but with gold prices in decline they stopped mining shortly before it took effect.
Environmental problems exist in varying degrees at the three sites.

The mining industry promoted cyanide as safer than other methods of extracting gold and silver from ore, and said I-147 set forth environmental safeguards. But critics and even state officials found nothing new in what the industry billed as a safety net.Copyright © 2004 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

Cyanide Mining Referendum (again) in Montana, US
Mon, 2 Aug 2004, Bozeman Chronicle

Voters to decide wheter to allow mining with cyanideBy SCOTT McMILLION Chronicle Staff Writer Montana voters will decide again in November whether to allow gold and
silver miners to use cyanide to leach gold from stone.

Initiative 147 has qualified for the ballot and marks the second time voters have been asked to make such a ruling. It's an important decision. How they cast their lot could affect landscapes and wallets across the state.

Mining is not always profitable, but it's always capital- and labor-intensive, which means a lot of money changes hands. Machinery and supplies are purchased. Buildings and roads and powerlines are built. Wages and taxes are paid.

On the other hand, mining can be incredibly messy, especially open-pit operations, where entire mountains are excavated, crushed and moved someplace else. That's where cyanide comes in. It makes those huge operations feasible. Once ore is crushed, a solution of cyanide is poured over it. A chemical reaction separates the gold from the rock, typically a fraction of an ounce per ton of ore.

In addition to the ore, huge amounts of waste rock or "overburden" must be moved. Excavating, breaking, moving and storing all that stone requires vast sums, long hours of hard and dangerous work, and all sorts of big equipment. And it also opens avenues for another type of pollution: a process known as acid mine drainage, or AMD.

Cyanide leaching and AMD "are as joined together as the hip and the knee," said Jim Jensen, executive director of the Montana Environmental Information Center and the author of Initiative 137, the 1998 measure that banned cyanide leaching for open pit mines.

When broken rock that contains pyrite -- a mineral often associated with gold deposits -- is exposed to water and oxygen, it forms sulfuric acid, which then cuts heavy metals from stone, runs downhill and enters streams, where the dangerous metals can enter the food chain.

Cyanide leaching "makes extremely low grade ore bodies profitable to mine and that makes for large scale landscape destruction," Jensen said.

Whether the landscape is destroyed or merely changed depends on the beholder. Whether all that work is worth the costs also is a matter of debate.

Mining in Montana is a shadow of its former self. Only five large hard rock mines still operate, and exploration has dwindled to a handful of prospectors, many of them hobbyists. In 1989, there were 140 active exploration permits in the state, operations that spent $24 million that year. By last year, only two major companies were exploring and they spent only $250,000.

Miners point to the cyanide ban as a big disincentive. There's little point in discovering gold if you can't mine it. In Montana, most of the high-grade ore is already out of the ground, and miners say cyanide is the best way to deal with low-grade ore.

Tammy Johnson, the Whitehall mining activist who authored I-147, said she recently attended a trade show in Denver, where vendors and miners showed little interest in Montana, the only state that bans cyanide leaching.

"You're crazy up there," was the consensus she heard, she said. If for example, a heavy equipment dealer is considering expansion and knows he can't count on much in the way of sales to mines, he's likely to choose Idaho over Montana, she said.

But cyanide is only one factor. A prime mover in mining is the price of gold. Mark Isto is general manager of the Golden Sunlight Mine in Whitehall, which still uses cyanide leach because it was "grandfathered" under I-137. Still, he said his operation was preparing to close last year until a spike in gold prices made the Canadian owners reevaluate things.

Plans now call for another five years of operation. That's good news for the 171 employees and contractors earning a $600,000 monthly payroll there. Mining pays an average of about $50,000 a year, roughly twice the statewide average wage. That payroll helps place Jefferson County's average income consistently among the highest
in the state.And mining companies spend a lot of other money.

According to a spreadsheet Isto provided, the mine has paid $30.3 million in state taxes since 1983. Since 1991, it has spent $219 million on goods and services in Montana.

But when the mine eventually closes, it will leave scarred and unsightly hillsides, a radically transformed landscape, along with an economic hole where all those jobs used to be. It's likely the mine pit will need perpetual treatment of the acidic water gathering in its bottom, lest it turn into something similar to Butte's Berkeley Pit, the epicenter of America's largest Superfund site.

It's not hard to find mining messes in Montana, which contains 3,800 abandoned mines. Taxpayers might have to shell out millions to deal with water problems at the bankrupt Zortman Landusky mine in northcentral Montana. There are similar problems at Beall Mountain, near Anaconda, and at the Kendall Mine near Lewistown, a property owned by Canyon Resources, the company financing the effort to repeal the cyanide ban.

Of the $764,000 the campaign has raised so far, $737,000 comes from Canyon Resources, which wants to build a giant open pit mine near Lincoln at the headwaters of the Blackfoot River.

"You can put all the lipstick you want on it," Jensen said of I-147, "but it's all about Canyon Resources."

Johnson, who is director of the campaign financed mostly by Canyon Resources, said the mine on the Blackfoot would employ 375 people for 25 years, plus make $1.2 billion worth of purchases.

If cyanide becomes an option again, she said, new mines could produce 7,000 jobs and help support 8,000 others.

Ray Rasker, an economist with the Sonoran Institute, specializes in studying rural economics. He agreed that mining can be an important part of a local economy. But he maintains that, over the long term, good views, clean air and clean water are what the state needs to protect.

"Montana's biggest economic asset is its clean environment," he said.

"That's what's bringing people here and keeping them from leaving."

He opposes Initiative 147, and points out that, even if mining doubled in Montana, all wages still would comprise less than 4 percent of personal income.

"It helps one small industry and potentially damages Montana's biggest asset," he said. "It just doesn't seem to make sense."

But what does make sense to other people is moving dirt, digging holes and making cash registers ring.

Johnson and Isto agreed that miners have made some big mistakes, but they insist that better technology, better regulations and the lessons of hindsight can help people avoid repeating those mistakes.

"What you can do is make sure any new mine is held to better standards," Johnson said.

Rasker noted that people are still cleaning up mining messes made as recently as the 1990s, and technology and regulations haven't changed much since then.

Big open pit mining spreads a lot of money around, but it doesn't last forever. The damage, on the other hand, might.

"Nobody knows how many hundreds of years the acid will continue to run off the mountain," Jensen said.

In November, voters will decide how big to let mining become.

Consultant seeks to repeal ban on cyanide leach mining process
Thursday, March 4, 2004 Lee State Bureau

HELENA – A Whitehall consulting firm, backed by money from mining company Canyon Resources Corp., took the first formal step Tuesday toward repealing Montana’s 1998 ban on cyanide leach mining.

Tammy Johnson, vice-president of Environomics, on Tuesday filed a three-page draft of an initiative she hopes to place on the 2004 ballot that would restore cyanide mining in Montana, adding more environmental safeguards to the practice.

“The people in this state want to have this dialogue,” she said. “People truly think that mining should be part of the economic underpinning of the state.”

With money from Canyon Resources, which had hoped to build a large, cyanide heap leach gold mine near Lincoln in 1998, Environomics has been looking into repealing the ban since late last year. The company hired Moore Information in Portland, Ore., to conduct focus groups with small groups of Montanans in December and January, Johnson said. The groups talked about repealing the cyanide ban and other natural resources questions.

Cyanide leach mining is a technique that extracts gold and silver embedded in large amounts of rock by trickling cyanide through rock piles. Cyanide dissolves the gold and silver into a solution. The precious metals are then extracted.

In 1998 voters passed Initiative 137 by a 52 to 48 percent margin, banning that practice. The ban came before Canyon Resources had a permit to break ground on its proposed McDonald Gold Project and after Pegasus Gold, which pioneered cyanide leach mining, went bankrupt, leaving several large mines to the state of Montana to clean up.

Critics say the ban froze any new mining in the state and hobbled the economy, while supporters say it protected Montana taxpayers from any more costly environmental cleanups.

The draft initiative, filed first with the Legislative Services Division on its long path toward being placed on the November ballot, would restore the legality of cyanide leach mining.

It would also require that leach pads, ponds and other mine elements containing cyanide to keep all the cyanide-tainted liquids from leaking, including the runoff resulting from major storms. All cyanide leach pads would also be required to have two liners and system for detecting leaks. The mines must also have a backup system to keep cyanide-tainted liquids from escaping.

Before the initiative can be placed on the November ballot, it must pass several legal reviews and supporters must gather 20,510 signatures from registered voters around the state. The signatures will have to come from at least half of Montana’s 56 counties.

Jim Jensen, executive director of the Montana Environmental Information Center in Helena and author of I-137, said the proposed initiative doesn’t offer any new environmental safeguards that weren’t available in the past – when cyanide leach mines were allowed and eventually leaked.

“This technology does not work,” he said. “The mining industry has never been able to show that they can build a cyanide leach gold mine that won’t leak and therefore have always sought permission for perpetual treatment of water because of the perpetual poisoning of water.”

Jensen said the effort “isn’t about jobs, it’s about profits,” particularly the profits of Canyon Resources, which is funding the drive.

Canyon Resources is currently squaring off against the state over cleaning up another gold mine the company owns, the defunct C.R. Kendall mine near Lewistown.

In January, Company President Richard DeVoto said his company was involved in efforts to repeal the ban, but only through its membership in the Montana Mining Association. He did not say that his company was paying the consulting firm overseeing the effort.

DeVoto said Tuesday his company is not the mouthpiece for the proposed initiative, although it “certainly endorses the effort.”

Jan Sensibaugh, director of the Montana Department of Environmental Quality, said all of the environmental safeguards required in the proposed initiative were available when cyanide leach mining was legal. However, none of them was specifically required by law.

Canyon Resources has been fighting the 1998 ban in court for years. But efforts to repeal the ban didn’t start gathering steam until the 2003 Legislature, when Sen. Debbie Shea, D-Butte, proposed – but later dropped – a bill that would have placed a repeal of the ban on the 2004 ballot.

Poisoning Montana's Future, May 2004
By John Baden, Foundation for Research on Economics and the Environment
Bozeman, Montana

Montana's current governor, Republican Judy Martz, as well as four Republican gubernatorial candidates favor a return of cyanide leach mining. (One, Ken Miller, flippantly told an audience, "You had some cyanide for lunch" because there were almonds on their chicken.) I object to cyanide on ethical, economic, and ecological grounds.

This process violates the most basic lesson responsible parents teach their children: if you make a mess, clean it up. Many mining companies use their political influence to escape this admonition. This is true worldwide.

Public choice economics explains the problem. Benefits from mining are current and concentrated. Social, economic, and environmental costs are distant, long lasting, and diffuse. Aiming for short-term economic advantage, mining outfits like Pegasus Gold trample both the property rights of those harmed and environmental quality.

But new forces are shaping the West. No longer does the region's future lie in resource extraction. An increasingly mobile workforce is drawn here for the environmental amenities: clean air, clean streams, and open space. What Montana needs is more capital -- physical and human -- not more mining.

Traditional mining operations aren't responsive to the importance of environmental quality in the new West. This is, in large part, due to the weak and outdated regulatory framework for which they lobbied and bribed. The old regulations haven't followed mining's change from picks and shovels to cyanide.

In some cases cyanide leaching may be as damaging, and is surely more insidious, than the old-time hydraulic mining techniques that physically reshaped entire rivers in the 1800s. Why? Because cyanide often (always?) leaks and contaminates groundwater. For example, in 1983 19,000,000 gallons of cyanide solution leaked from the Golden Sunlight mine near Whitehall. Somewhat over 135,000,000 gallons have escaped into Montana's waters in the past 20 years. In 1998 Montana voters passed Initiative 137 to stop this harmful technology.

These spillovers (or leaks) harm wildlife, human health, and the property rights of neighbors. The EPA estimates 40 percent of the headwaters of all western watersheds are polluted by mining wastes.

The Republican gubernatorial candidates seem to oppose the Bush administration's position. In 2001, Bush upheld several objectively defined legal hurdles, added by Clinton, to the mining of gold, copper, lead, and zinc on public lands. Interior Secretary Gale Norton said: "We have required that companies that operate on federal lands post performance bonds to cover the costs of reclaiming land and also to provide an incentive for companies to protect environmental resources. In addition, we retained strict standards to address cyanide and to protect areas from acid mine damage...."

On balance, the rules are beneficial and were long overdue. Here's an example, one of hundreds.

The now bankrupt multinational Pegasus Corporation operated the Zortman-Landusky mine near the Fort Belknap Indian reservation in Montana. Since commencing mining in 1979, the operation has accumulated a vast rap sheet of environmental fines. The $32 million reclamation bond it was forced to post in 1996 is grossly insufficient to do the job. Taxpayers have spent nearly $30 million to clean up or seal in contamination at the site. A failure to require companies to bear the full costs of their actions is a huge subsidy.

Some subsidies are justified by their contributions to the general welfare. Education and research are prime examples. The mining subsidies however, result in harmful distortions by neglecting or discounting future costs. Whether they are explicit or implicit, they violate reasonable standards of equity, efficiency, and environmental quality.

I believe we are well past the time when the West may be easily manipulated as a colonial economy. Average education, income, and sensitivities have increased. As a consequence, our tolerance for environmental abuse has lessened. Given their avowed stand on responsible environmentalism, Republicans should recognize this. If they fail to do so, they will continue to lose the support of the well educated and well off. They will earn this fate by neglecting ecology and equity under the law.

Montana's future lies in improving educational opportunities for its youth and attracting entrepreneurial immigrants. Clocks don't run backward. Looking to mining for the state's economic salvation is a Ghost Dance that confuses fuzzy hopes with clear-eyed expectations.

John A. Baden is chairman of the Foundation for Research on Economics and the Environment (FREE) and Gallatin Writers, both based in Bozeman, MT.

India reverses mine closure ruling
Tuesday, 17 December, 2002, 09:33 GMT

Thousand of workers in the northern Indian state of Rajasthan are to be allowed back to work after an Indian court lifted a ban on mining operations in the state.

The provincial government of the mineral-rich western Indian state of Rajasthan had suspended operations in more than 600 mines, following a court order for their closure.

The order said that mining was damaging the environment in the mountains, and followed a petition filed by an environmental activist.

According to the state government, permanent closure would have led to 700,000 job losses and the state would lose revenues of more than $100m ($63.6m).
Successful appeal

That prospect led state chief minister Ashok Gehlot to seek the intervention of Prime Minister Atal Behari Vajpayee.

The ruling has now been successfully reversed and all existing mines can begin operations again.

But, as a concession to the environmentalists, mining firms will not be allowed to open any new mines.

Rajasthan has a range of mineral deposits including zinc, lead, cadmium as well as marble and other precious and semi-precious stones.

Unemployment in the state is already running high, and has been aggravated by the recent drought.

___________________________________________________________________________________________________________________________________________________________________________Honduras Honduras to halt gold mine after protests>
Friday, April 16, 2004 , Source Reuters

TEGUCIGALPA, Honduras — The Honduran government said Thursday it would revoke a Canadian company's right to search for gold near a nature reserve after environmental protesters blocked a major road for two days.

Protesters opened the road in western Ocotepeque province after government negotiators agreed to overturn a concession allowing Canadian mining exploration company Maverick to search for gold in a 950-acre site bordering the Guisayote nature reserve, government sources said.

"The exploration and exploitation contract granted to Maverick will be rescinded. The concession process will be examined and it will be overturned within four months at the latest," said Natural Resources and Environment Minister Patricia Panting.

More than 1,000 local residents took part in the blockade, which prevented some 500 vehicles from crossing the border into neighboring El Salvador and Guatemala, including trucks ferrying goods to and from the Caribbean port of Puerto Cortes in northern Honduras.

Residents feared that the water-rich reserve would be churned up by the open-cast mining process permitted under the concession and risk pollution from sodium cyanide, used by the mining industry to separate gold from ore-bearing rocks.

Opposition to mine working has grown in Honduras in recent months. Two companies are currently working open cast concessions in the Central American nation.
Officials from Maverick, a small unlisted company, were unavailable for comment. The firm won the concession in July 2003.

Gold Campaign | Coalition | Cyanide | Lake Cowal |
Rainforest Information Centre