ARTISANAL GOLD MINING: FORMALIZATION IS NOT REDUCING POLLUTION

JurisdictionDerecho Internacional
International Mining and Oil & Gas Law, Development, and Investment (April 2017)

CHAPTER 20B
ARTISANAL GOLD MINING: FORMALIZATION IS NOT REDUCING POLLUTION

Marcello M. Veiga
Bruce G. Marshall
Max Thomas
Norman B. Keevil
Institute of Mining Engineering,
University of British Columbia
Vancouver, Canada

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MARCELLO M. VEIGA has worked since December 1997 as a professor of the Norman B. Keevil Institute of Mining Engineering of the University of British Columbia, Vancouver, Canada. Since 2012 Dr. Veiga has been a full-professor teaching and researching environmental and social issues in mining. He has more than 300 publications. He has worked for the past 35 years as a metallurgical engineer and environmental geochemist for Governments, Universities, International agencies, NGOS and companies in Brazil, Canada, Colombia, Costa Rica, Chile, China, Ecuador, Ghana, Guinea, Guyana, Honduras, Indonesia, Laos, Mexico, Mozambique, Nicaragua, Peru, South Africa, Sudan, Suriname, Tanzania, US, Uruguay, Venezuela, and Zimbabwe on these issues. From 1977 to 1997, he was employed by the Brazilian Center of Mineral Technology (CETEM), Vale do Rio Doce company, Paulo Abib Engineering and Techmat Consulting. From 2002 to 2008, he worked as an expert and Chief Technical Advisor of the Global Mercury Project for UNIDO - United Nations Industrial Development Organization, in Vienna. This included the environmental and health assessment of mercury pollution in artisanal gold mining in Asia, Africa and South America as well as the implementation of national policies and procedures to reduce mercury emissions and increase gold recovery. Since 2008 he has been key consultant for a large number of mining companies and international agencies dealing with artisanal mining and socio-environmental issues in mining.

Abstract

The formalization of artisanal miners, who are mainly gold miners, in developing countries continues unabated, although the results have not been fruitful. Due to the strong price of gold and increasing poverty, more and more rural workers are turning to artisanal mining to try and eke out a meager living. At the same time, many mining companies are buying up large concessions in top commodity-exporting countries. Invasions of company-owned concessions by "informal" and "illegal" miners are causing major conflicts in rural areas, leading to government-led military interventions in some cases. First, the legislation needs to be changed in order to directly correlate taxes with ore production and discard useless definitions of different types of miners. Secondly, formalization cannot exist without education. Uneducated gold miners, if formalized, will continue with their inefficient methods of mining and processing, which cause widespread atmospheric and fluvial pollution. Without training and the organization of artisanal miners into groups, cooperatives or associations, governments cannot expect that these rudimentary miners will be converted into educated, responsible miners, who are willing to adopt cleaner, more sustainable practices.

Definitions of Artisanal and Small-Scale Mining

Artisanal and small-scale gold mining (ASGM) is an essential activity in many developing countries, as it provides an important source of income, particularly in rural regions where economic alternatives are critically limited. The spectrum of artisanal mining activity worldwide encompasses small, medium, informal, legal and illegal miners, who use rudimentary processes to extract more than thirty different minerals. In 1998, the International Labour Organization (ILO, 1999) estimated that the number of artisanal miners globally was approximately 13 million in 55 countries. Currently, the number of individuals directly involved in ASM activities is estimated at 30 million. As the price of gold has increased significantly over the past decade (from US $640.80/oz in March 2007 to approximately US $1202/oz in March 2017) (Kitco, 2017), the number of artisanal gold miners has also increased substantially. Swain et al. (2007) estimated that annual gold production from ASGM activities represented approximately 20 to 30% (500-800 tonnes) of total global production. A more recent study (Seccatore, 2014) estimated that gold production from approximately 16 million miners was ~ 415 tonnes/annum

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(tonnes/a) (with a range of 380 - 450 tonnes/a) or about 11% of total mining output in 2016 (3,236 tonnes from organized mining + 415 tonnes from ASGM) (World Gold Council, 2017). Legislation in many developing countries associated with artisanal mining is fraught with confusing definitions. Artisanal mining refers to a rudimentary type of mining and processing used to extract minerals from secondary or primary ores, whereas small mining refers only to the size of the operation (Veiga, 1997). It is important to recognize that a small mine may operate in a conventional or artisanal fashion. Similarly, an artisanal mining operation can process over 10,000 tonnes of ore per day using rudimentary methods, which should not be considered small (Table 1) (Veiga et al, 2014a). The main attribute of conventional and artisanal activities refers to the technologies applied on site and in the ore processing. For example, an artisanal miner typically works based on instinct and the need to feed his family and pay bills. There is no previous "classical" geological exploration or drilling, proven reserves, ore tonnage establishment, nor engineering studies undertaken. The concept of survival is constantly the driving force for these miners.

Table 1. Fundamental differences between artisanal and conventional mining operations. Source: Veiga et al., (2014a)

Type of Mining Size Legal Situation Mechanization
Artisanal (rudimentary) • Micro • Illegal • Manual
• Small • Informal • Semi-mechanized
• Medium • Legal • Mechanized
• Large
• Small
Conventional • Medium • Legal • Mechanized
• Large

"Informal mining" is another confusing term found in many types of legislation. This is a broad term that comprises all forms of mining that operate without labor or social protection and is usually used synonymously with "illegal mining". Illegal mining is usually identified when the activity is conducted without a proper title, authorization or concession issued by the competent authorities, while informal mining is a set of deficiencies in environmental management, technical assistance and development, access to information and acceptable working conditions (Hentschel et al., 2002).

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While few countries have clear regulations or definitions regarding the activities that are classified as ASM, almost all mining legislation refers to the size of the operation. In Peru, Law 27651 of 1992 (Peru, 1992) provides definitions based on production capacity. Here, a large-scale mine is one that exploits and processes more than 5,000 tonnes of ore per day (tpd), while a medium-scale mine processes from 150 to 5,000 tpd. In comparison, the Ecuadorian Mining Law stipulates that a small-scale mine (artisanal or not) is allowed to extract up to 300 tpd, with a tax of 5%. However, everything above this capacity is considered large-scale mining and subject to taxes as high as 50%.

In many countries, legislation involves multiple definitions of miner types, including subsistence, artisanal, traditional, small, medium, rudimentary, etc., which end up confusing more than clarifying. In Colombia, the Mining Code of 1988 provided a definition of the type of mine based on the volume of material being extracted, the installed capacity for mining and mineral processing, as well as other technical, social and economic aspects. The Colombian Decree 2636 of 1994 defined informal miners as "mineros de hecho" (miners de facto), who did not have any mineral title and who practiced mining as a traditional economic activity (Ministerio de Minas y Energia, 2014). In the Colombian Mining Code of 2001, although mining size delineation was eliminated, definition of the "barequeo" (panner) was expanded, relating this to miners who manually wash sands. Any type of mechanized activity was excluded from this category and a "barequero" was required to be registered at the local city hall and have authorization from the local landowner. Furthermore, the Mining Code dictates that the mayor has the authority to resolve any possible conflicts among parties. Although informal "barequeros" are supposed to stay 300 metres away from formal mineral titles owned by third parties, this is never respected nor enforced. In comparison, the term "mineros de hecho" was removed from the Mining Code issued in 2001, being replaced with "traditional exploitation", which is defined...

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