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Peru’s Mountains of Gold

High in the Peruvian Andes, large mining companies have transformed both landscapes and lives. Catherine Meyers reports. Illustrated by Martha Iserman.

gold image

Illustration: Martha Iserman

On November 16, 1532, in the Peruvian mountain town of Cajamarca, the Inca king Atahualpa walked into a trap set by conquistador Francisco Pizarro. In less than an hour, fewer than 200 Spanish soldiers massacred thousands of unarmed Incans and seized their leader. Atahualpa offered to fill a large room with gold in exchange for his release. Today, this king’s ransom might look like pocket change to the new foreigners who are transforming Cajamarca.

Denver-based Newmont Mining Corporation moves more than a half-million tons of mountain each day at the Yanacocha mine, just 48 kilometers north of the town where the Spanish captured Atahualpa. Already the operation has extracted more than 26 million ounces of gold from the Andes earth.

“Yanacocha is huge,” says UC Santa Cruz environmental scientist Jeffrey Bury, who has studied the mine and its impacts since 1997. Sitting in his office, he deftly pans over a Google Earth satellite view of the sprawling city of Cajamarca, home to 150,000 people. Zooming in on the mine, Bury points to trucks perched along the edge of an open pit. They seem almost antlike, but in a ground-level photo a behemoth emerges. The truck looks like a two-story house with ten-foot-tall wheels. “I call these the new conquistadors of the 21st century,” Bury says.

Bury then brings up two other photos, staples of his research talks. The first is a bucolic image of rolling hills covered with grass. Two colorfully dressed campesinos coax a plow team of oxen forward, while in the distance snow-capped peaks touch a cerulean sky. In the next photo, a mountaintop has been radically reshaped. All vegetation is gone, replaced by a cavernous hole. Surrounding expanses of clean-shaven rock form a terraced moonscape.

Imagine, Bury says, if your landscape went from agrarian grazing land to pit mine in ten short years. For many communities in Peru, this is not just a mind game.

gold2Since free-market reforms swept through Peru’s economy in the 1990s, transnational mining companies have flocked there. They’ve brought change at an unprecedented pace and scale. Money, men, and machines streamed into rural communities, where residents had eked out meager livings. The mines permanently altered the physical and social landscape. The skyrocketing real-estate prices, inequality, and social tension remind Bury of stories from American West boom towns, more than a century ago.

A popular saying in Peru goes, “El Peru es un mendigo sentado en un banco de oro”—Peru is a beggar sitting atop a gold bank.

Mining metrics

Peru’s vast mineral wealth has drawn ambitious miners to its mountains since the time of the Spanish conquest. In the latter half of the 20th century, however, the country’s turbulent political atmosphere made big capital investments risky business.

In 1968, General Juan Velasco Alvaredo led a military coup, seizing control of the Peruvian government and instituting revolutionary policy changes. He nationalized key industries, redefined land rights, and initiated social welfare programs. By the early 1980s the new economic landscape was showing signs of distress. Global oil crises, a devastating earthquake, and extensive international borrowing led Peru’s economy to the brink of collapse. When President Alan Garcia tried to remedy the situation by nationalizing banks and defaulting on foreign debt, the results were disastrous. Inflation soared above 7,500%, economic output plunged, and a violent civil war wracked the country.

Garcia was ousted in a presidential election in 1990 and replaced by the dark horse candidate, Alberto Fujimori. Almost immediately, Fujimori engineered a relentless economic about-face. He pushed through free-market reforms and opened up all sectors of the Peruvian economy to direct foreign investment. Peru’s military effectively neutralized guerilla movements such as The Shining Path.

By the early 1990s the stage was set for radical change. And in 1992, Newmont Mining Corporation became the first transnational mining company to invest in Peru since 1976.

At first the company planned to operate in the Cajamarca region for only six years, the anticipated lifespan of the area’s gold deposits. However, Newmont soon reevaluated its position. As geologists discovered more gold, the mine kept growing. Meanwhile, the price of the precious metal, which had fluctuated throughout the 1990s, surged into the new millennium. From 2000-2005, gold’s dollar value on the London Bullion Market nearly doubled, and by 2008, it had doubled again. The profit incentive to expand the mine was irresistible.

Today, the Yanacocha mine is clearly visible from the surrounding villages. Spread across the mountaintops above Cajamarca, the mine dominates the milieu of the city below. Newmont moves close to 200 million tons of earth every year at Yanacocha. In 2009, its sale of gold from the mine totaled more than $1 billion.

gold photo
Photo: Jeffrey Bury

The Yanacocha gold mine, run by Denver-based Newmont Mining Corporation, has transformed the mountains above Cajamarca, Peru. Watch Jeffrey Bury's narrated video of the Yanacocha mine. (Click on image to see larger photo.)

In his archive of photos, Bury points out large loads of explosives, destined for the mine site. Whole hillsides are blasted off, and the resulting shards fill trucks. In a highly mechanized process, workers transport the rocks to leach pads, where they are washed with a weak cyanide solution to remove the gold.

Bury’s virtual tour of the mine zooms from one leach pad to the next. “I have to use satellite imagery to convey the scale of this thing,” he says. “I don’t think people really get it. In fact, I don’t really get it most of the time. These are giant operations.”

Electrical transmission lines weave their way up the mountain. The mine is by far the largest consumer of electricity in the region, and it’s probably one of the largest consumers of petroleum in northern Peru, Bury says. Staggering amounts of money have traded hands. Since 1992, Newmont has invested billions of dollars in its Yanacocha operations. In 2008 and 2009, it spent close to $13 million on social and environmental programs alone.

Even more amazing to Bury than the scale of change is the blistering pace. Bury grew up outside of Salt Lake City near Bingham Canyon copper mine, the deepest open pit mine in the world. “It took 100 years to do that,” he notes. Newmont’s new technologies could probably do it in a decade.

In Peru, other companies soon followed Newmont’s lead. Since 1992, more mining claims have been filed in the country than in the hundreds of years of recorded history prior to Fujimori’s reforms. Today, more than 10% of the country is covered by mining concessions.

Eyewitness to change

In the late 1990s, just as the mining sector in Peru was breaking open, Jeffrey Bury began his graduate studies at the University of Colorado, Boulder. His adviser, geographer Anthony Bebbington, studied rural poverty and development and had contacts in Peru. Bebbington’s wife, Denise Humphreys Bebbington, was a something of an activist at the time. She saw signs presaging the mining sector’s explosive growth, so she encouraged her husband and his students to study its transformative effects.

All factors pointed Bury towards Peru. The country had opened up, and after years of unrest it was finally safe to travel to Lima. Bury was drawn to Latin America as the perfect case study for how the actions of transnational corporations drive local changes. To get hard data from the field, Bury embarked on an ambitious Andes trip, “a yearning Ph.D student with a backpack and a pencil,” as Bebbington described him. 

Bury is a tall, fit man who wears hiking boots to the office and keeps mason jars as drinking cups. The field work that he continued almost yearly over the next decade required both an outdoorsman’s experience and a scholar’s systematic thoroughness. It could take days of rough travel for Bury to reach the remote communities surrounding Cajamarca, where he conducted his research for weeks at a time in the summer. At elevations of 3,500 meters or more, he often experienced four seasons in one day. His work began at 6 am or earlier and ended at 6 pm, when the sun suddenly disappeared below the horizon. Trails would sometimes travel straight up a mountain. “It’d be raining or cold, or you’d be sweating profusely,” Bury says.

gold3Bury focused locally, examining how the Yanacocha mine impacted the livelihoods of the people in nearby communities. He conducted extensive interviews with residents to measure how their access to resources changed over time.

To do his interviews, Bury first had to overcome suspicion. Many people assumed he worked for the mine. He gained villagers’ trust by finding local institutions to partner with. “We might arrive alone, but we don’t arrive cold,” says Bebbington, who stressed the importance of working with Peruvian organizations.

A more prosaic challenge came from the difficulty of finding people at home. The campesinos worked from dawn to dusk, and Bury spent a lot of his time waiting for interview subjects to return.

“To be around extreme poverty for a long time is emotionally exhausting,” Bury says. He met 35-year-old men who looked 50 due to chronic malnutrition, and saw grandparents, almost blind with cataracts, bent over in the fields to harvest potatoes. Despite their hardships, the villagers who came to know Bury welcomed him. “I’ve never met more genuine and kind people,” Bury says.

gold slideshow
Slideshow: Photos from UC Santa Cruz researcher Jeffrey Bury document the city of Cajamarca and the gold mine looming above its residents. (Click image to launch show.)

To quantitatively measure how the mine changed their lives, Bury drew upon a new approach to gauge its effects. He divided the community resources into four categories: economic, human, natural, and social. Economic resources included access to infrastructure, money from land transactions, and employment. Human resources were access to formal education, technical training, and health services. Natural resources included land and clean water, while social resources covered the development of local organizations, conflict resolution mechanisms, and community leadership.

After years of these studies, Bury found that residents generally had better access to economic and human resources, but the natural and social resources were worse. The campesinos' biggest worry by far— reported over and over again—was the mine’s impact on their water supply.

Due to Peru’s tropical seasons, the Andes are a very dry environment for part of the year, Bury explains. “Most villagers are one harvest away from starvation,” he says. The mines often sit atop high mountain watersheds. Miners extract gold from low-grade deposits through cyanide heap leaching, which produces toxic mercury byproducts. But the main dangers of water contamination arise not from the chemicals, which should be contained, but from the sheer tonnage of earth moved to extract a single ounce of gold. Bulldozers strip topsoil and vegetation while drills, blasters, and excavators gouge large open pits.

“Open pit mines are sacrifice areas,” says hydrologist Mark Williams of the University of Colorado, who studies mining and its effects on water quality. “They permanently change the landscape.”

The landscape alterations often flush sediments into streams and rivers. The Yanacocha mine has several sediment ponds to collect runoff, but that protection isn’t perfect. An even more nefarious danger is acid mine drainage, or AMD. Pit-mining operations produce gigantic piles of waste rock and leave huge holes. Exposed to air and water, these can release acidic runoff that fouls rivers, contaminates groundwater, and kills fish.

“AMD is the legacy that keeps on giving,” says Williams. “Here in Colorado, we have somewhere around 20,000 mines generating AMD a hundred years after mining stopped.” There is a danger Cajamarca’s water will become more contaminated with time.

Avatar in the Andes

Newmont Mining, which declined repeated requests for comment, has published environmental sustainability reports on its global mining operations since 2003. In its 2009 report to shareholders, the company stated, in bold face, “Our success depends on our social and environmental performance.” Newmont also wrote, “Our operations in Peru are subject to political risk.” Or as Bury puts it, “Sometimes going out of business can be very sudden.”

gold1In June 2000, a Newmont-contracted mining truck accidentally spilled 151 kilograms of mercury while driving along a 41-kilometer stretch of road that passes through the small town of Choropampa. Villagers sickened by the spill angrily clashed with police and demanded reparations from Newmont. The company paid for medical treatment and other damages in a settlement, but tensions between the mining operation and the local people lingered.

In 2004, Newmont announced plans to mine the sacred Incan mountain Cerro Quilish, sparking further peasant protests. Although water-monitoring programs have improved and the mine has invested extensively in environmental remediation programs, villagers still report fish kills and livestock sickened by contaminated water. “Small demonstrations developed into large demonstrations, which led to hunger strikes, rock-throwing, and even setting the offices of the mines on fire,” says Bury.

Bury likes to show a picture he took of a 2000 protest in Cajamarca as an emblem of the community outrage that burst forth. The village square is filled with people. In the front row, middle-aged women from the Rotary Club of Cajamarca, staid and proper, have unfurled a banner: “While you do not respect our lives and environment, it will be difficult to clean the open wounds.”

“I’m pretty sure that the Rotary Club is the same all over,” Bury says. “This is not the revolutionary phalanx of Cajamarca.”

The conflicts provide a new area of research for Bury. He has joined forces with his old adviser, Anthony Bebbington, to examine the causes of social protest and the role of conflict in catalyzing changes in stubborn or corrupt institutions.

“There is a dynamic relationship to be analyzed between conflict and sustainable development,” Bebbington says. “Historically, there is good reason to see conflict as productive rather than as a problem.”

Indeed, the conflicts have prompted many mining companies to change their approaches to development and community relationships. “Newmont learned some good lessons about operating with local communities,” Bury says. “Now other mining companies have done more community consultation and have been more careful prior to setting up operations.” Newmont’s own approach evolved from asking miners’ wives to hand out Christmas presents to hiring an army of development professionals and establishing a community relationships review board.

Newmont is a member of the International Council on Mining and Metals. Founded in 2001, the organization requires annual reports on progress toward ten sustainable development principles, including environmental performance and community development. 

gold4Newmont has poured millions of dollar into social and environmental programs in the Cajamarca region. The company paved roads, installed piped water connections, and funded girls' and boys' camps. In 2006, the company agreed to contribute 3.75% of its net profits to fund social development programs for up to five years. However, the results from such copious spending have been mixed, at best, Bury says.

At the national level, mining companies sign contracts with the democratically elected central government of Peru, which sees rapid mining growth as a way to lift the country out of poverty. In 2007, President Alan Garcia published an opinion piece in the Peruvian newspaper El Comercio. “The old anti-capitalist communists of the 19th century disguised themselves as protectionists in the 20th century, and changed colors again in the 21st century to be environmentalists,” he wrote.

Ultimately, Bury and Bebbington view their research as helping to bridge gaps between the mining companies’ board rooms, Lima’s government offices, and Peruvian peasants in their fields and homes.

“For me the primary goal is to foster public debate about what’s at stake,” says Bebbington. Bury says he is concerned about the long-term consequences for Andes communities once the miners have pulled their profits from the earth. Both researchers prevent society from turning a blind eye to the collateral damage of a thing we call progress.

Story © 2011 by Catherine Meyers. For reproduction requests, contact the Science Communication Program office.



Catherine Meyers
B.S. (engineering) Harvey Mudd College
Internship: American Institute of Physics (College Park, MD)

My parents often told me I was born with an old soul. I think they perceived, in their young daughter, the emotional stability and perspective of a more mature mind. But as I actually aged, I entered my early twenties consumed by a Peter Pan–like fear of growing up. This youthful anxiety arose from a severe case of career uncertainty.

I first tried out engineering, but I found the idea of sending spaceships to Mars more engaging than hours of debugging computer code. Indulging my wanderlust, I travelled to Ukraine to teach English in the Peace Corps. There, I missed science and technology. Science writing is the career incarnation that for the first time feels right. As I embark on this new path, my ‘old soul’ composure has returned.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Martha Iserman
B.F.A. (drawing and printmaking) University of Minnesota, Twin Cities
Internships: Field Museum (Chicago); Smithsonian Institution (Washington, D.C.); with work to follow at the Harvard Museum of Comparative Zoology

Being an artist has always been a driving force in my life, but the natural sciences have been the inspiration behind my work. I went to an arts high school as a teenager and received my Bachelor of Fine Arts from the University of Minnesota in printmaking. After working for a few years selling my paintings and prints, I decided to officially integrate my love for the sciences into my work. My main illustration focus at CSU Monterey Bay has been invertebrate zoology.


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