Over 800 million people still live in extreme poverty and almost a third of the world's population still lives on the equivalent of about US$3 a day. A lack of decent work opportunities erodes the social contract underlying democratic societies: that everyone must share in progress. Sustainable economic growth depends on creating the conditions that allow people to have decent jobs that stimulate the economy while not harming the environment. All ICMM members implement the 10 principles that underpin our Sustainable Development Framework. Principle 9 requires companies to continually improve their social performance, and contribute to the social, economic and institutional development of host countries and communities.
Since 2013, Barrick Peru has supported the process to formalise artisanal and small-scale mining (ASM) launched by the Peruvian government. ASM is a key economic activity for many local populations in Peru, but generates many negative social, health and environmental impacts. In bringing together the company and artisanal miners’ associations, Barrick’s efforts are impacting positively on the community’s health and well-being (SDG3); improving working conditions and efficiency (SDG8); and remediating the local environmental legacy of artisanal mining (SDG 15).
In Peru, artisanal coal mining is common and often conducted informally without required permits or appropriate environmental, health and safety measures. In the Perejil basin near Barrick’s Lagunas Norte mine, more than 220 active artisanal mines lie sprinkled across the basin’s steep slopes. The miners who toil there are organised in three main associations: Asociación de Mineros Artesanales del Alto Chicama (AMACHIC); Asociación Regional de Carboneros de La Libertad (ARCALIB); and Asociación Rayambal. In this region, only 58 per cent of the population is of working age and there is a high level of dependency on the ‘household heads’ to earn a living. Coal mining provides these individuals with additional income.
In 2012, a baseline study conducted by Barrick in the region showed strong local support for artisanal mining. It was considered a source of employment and income to buy food, pay for schooling and health services, buy seeds and supplies for farming, and fund improvements to household infrastructure. Flow-on economic benefits include the creation of small businesses and shops.
Nonetheless, more than 60 percent of artisanal miners interviewed as part of the study recognised that their activities have significant negative effects on the environment and human health. Key dangers facing artisanal coal miners include cave-ins, the presence of explosive gases, flooding and mudslides, coal slips, and falls according to the study. Yet only 20 percent of household heads considered artisanal mining to be ‘high-risk’. At the same time, the miners did recognised that, by throwing waste into the rivers, they were damaging the environment. Indeed, one of the local rivers flows through one of Peru’s largest agricultural irrigation project. The miners also acknowledged that the dust generated by their activities was impacting their health, as well as the health of the local population.
Enhancing benefits and mitigating risks through formalisation
With this information in hand, Barrick saw an opportunity to raise awareness about artisanal mining as a “high-risk” activity, help improve the lives of the local community, and reduce the environmental impacts of artisanal mining, They have done this by working with the miners to legalise their activities, a process known as “formalisation.”
The Peruvian government had been moving towards formalisation since as far back as 2002, but progress was slow. In 2010, however, the terms and conditions for formalisation were issued, including various permitting and accreditation requirements, as well as water and environmental approval criteria. Additional regulations were later issued to facilitate the process. The objective of formalisation was to reduce environmental contamination, avoid inappropriate disposal of tailings, promote formal employment, eliminate child labour, avoid mineral loss, and increase the value of extracted minerals.
This national policy provided the framework for Barrick Peru’s initiative to support the formalisation of artisanal mining.
Working in partnership
In 2009, as the government began to accelerate its work on the national policy to formalise artisanal mining, one of the three local artisanal mining associations, AMACHIC, approached Barrick to ask for support in undertaking the formalisation process.
Following two years of discussions and relationship building, Barrick and AMACHIC developed a framework for action. With no successful examples of formalisation in Peru, they were treading on new ground. The other two artisanal mining associations, ARCALIB and the Asociación Rayambal, remained on the side line observing the process, waiting to see how it progressed before committing to the same approach.
AMACHIC develops coal mining within the “Accumulation Alto Chicama” mining concession area, a vast area that includes the Lagunas Norte mine footprint. After a baseline study was carried out in 2012, Barrick and AMACHIC signed an agreement in 2014 under which Barrick authorised coal mining in certain areas of its mining concession by AMACHIC. This was the first step in the formalisation process. AMACHIC could then proceed with other formalisation requirements, such as developing environmental management and safety plans, and obtaining final government approval.
Barrick played an important supportive role in the formalisation process, engaging with both the artisanal miners and mining authorities. The company also reviewed AMACHIC’s formalisation application and helped the artisanal miners to work with the mining authority throughout the administrative process. This required months of work to ensure the miners fully understood the layout and structure of their pits and tunnels, and to help the miners organise themselves into more efficient operational groups. Barrick also provided support with the technical documentation and mapping required for the application process.
AMACHIC’s formalisation was approved in 2015. Some 76 coal mine areas were covered and benefitted approximately 500 families from 12 communities. ARCALIB, one of the other mining associations, is now initiating the formalisation process, with Barrick’s support.