by Philip Mattera
Thanks to an aggressive series of acquisitions over more than quarter of a century, Canadian-based Barrick Gold has grown to become the world's largest producer in the dirty business of gold mining. Along the way it has become embroiled in controversies over pollution, human rights and mine safety issues on five continents. The company's claims that it is committed to "responsible mining" have not satisfied its critics.
Barrick's Spending Spree
The company dates back to 1983, when Hungarian-born Canadian entrepreneur Peter Munk formed Barrick Resources with the aim of becoming a major player in the gold industry through mining backed up with aggressive hedging contracts. Barrick began investing in various North American mines, the most successful of which were in Ontario, Nevada and Utah. The acquisition of another substantial gold property in Nevada, the Goldstrike Property, brought the company to a new level of prominence and prompted a corporate name change to American Barrick Resources. A series of acquisitions during the 1990s gave the company a significant presence in South America and prompted another name change to Barrick Gold.
Barrick's smooth trajectory was interrupted in the late 1990s, when it became embroiled in messy battle over what was believed to be a major gold find in the Indonesian portion of the island of Borneo. A small company called Bre-X Minerals announced the find but was pressured to bring in Barrick to help develop the mine. The two companies had a falling out, and Barrick exited, a fortunate move given that Bre-X's discovery turned out to be a fraud.
Barrick went on to purchase various other mining properties, including some in Tanzania, but it was the $2.3 billion acquisition of the U.S. firm Homestake Mining in 2001 that made Barrick the world's second largest gold producer (behind South Africa's AngloGold). The company did not stop there. In 2005 Barrick made a hostile bid for its rival Placer Dome and ended up paying $12 billion to carry out the largest acquisition in the history of gold mining and become the industry's top producer. In 2011 Barrick placed a big bet on copper through the $8 billion purchase of Equinox Minerals.
Tanzania. In 2001 Barrick faced calls for an independent public inquiry into reports that dozens of people may have been buried alive at its Bulyanhulu gold mine in Tanzania in 1996 when the site was being cleared of thousands of "illegal" miners to facilitate authorized production by the Canadian firm Sutton Resources, which was purchased by Barrick a few years later. Barrick was later a focus of growing criticism of government policies that allowed foreign mining companies to use low-wage labor and pay little in the way of taxes. Workers staged a wildcat strike at the mine in 2007.
In 2008 Barrick filed a C$6 million libel lawsuit against a small non-profit Quebec publisher which had released a book called Noir Canada about the Bulyanhulu mine incident. The case was settled out of court, with the publisher agreeing to take the title off the market.
A 2009 chemical spill at Barrick's mine in the Mara Region were reported to have caused contamination of water supplies and health impacts, prompting calls for the closure of the operation. In 2010 operations at the Bulyanhulu mine were suspended after three workers were killed in a cave-in. Community members accused security guards and police of shooting people scavenging waste piles. In 2011 those guards killed seven people described by Barrick's local subsidiary as part of a group of "criminal intruders" who allegedly entered the mine site with the intent of stealing gold ore. More killings of "intruders" occurred in the following years. In 2014 a lawsuit was filed in a British court accusing the company's subsidiary African Barrick Gold, now known as Acacia Mining, of complicity in the deaths. In 2015 Acacia reportedly settled the case out of court without disclosing the terms.
Zambia. In 2014 Barrick warned that the viability of its Lumwana copper mine, which it acquired through the purchase of Equinox Minerals, was in question following a decision by the Zambian government to require the company to pay a 20 percent royalty in lieu of income taxes. After the government agreed to a lower royalty rate, Barrick announced it would keep the operation running.
Pakistan. In 2012 Pakistan's top court invalidated a lease held by Barrick and Chile's Antofagasta Minerals for a site said to contain one of the world's largest deposits of gold and copper. The companies filed an international arbitration case but the dispute has not yet been resolved.
Papua New Guinea. When Barrick purchased Placer Dome, it inherited a long-standing conflict over the company's mine in the Porgera Valley. In 2006 a Canadian newspaper described the situation as a "war zone, with hundreds of villagers facing off against more than 450 security guards and police in a bloody battle" that left eight people dead. The company put the blame on "illegal" miners it accused of trespassing on its property. In 2009 the Norwegian government announced that its pension fund would no longer invest in Barrick stock because of the environmental impact of waste from the Porgera mine. An Amnesty International investigation found that police had carried out improper forced evictions of people living near the mine and then destroyed the homes.
There were also accusations of gang rapes by company security guards. Barrick responded by dismissing some of the guards, but chairman Peter Munk found himself at the center of an international furor after he was quoted as saying it was difficult to prevent such behavior in countries where "gang rape is a cultural habit." In 2015 Earthrights International negotiated a financial settlement for 14 women who had been raped.
Two "illegal" miners were killed in clashes with security forces in 2013. As tensions escalated, the Papua New Guinea government declared a state of emergency in the area of the mine in 2014. Incidents of violence nonetheless continued, as did peaceful protests.
Philippines. In 1996, prior to its purchase by Barrick, Placer Dome was involved in one of the country's most serious mining disasters, which took place on the island of Marinduque. A fracture in a drainage tunnel used by Placer Dome subsidiary Marcopper led to a huge discharge of toxic tailings waste and flash floods that inundated some two dozen villages. A large quantity of crops was destroyed and the Boac River became unusable. Placer Dome said that it would take responsibility for the clean-up, but the company left the Philippines without fulfilling its commitments. After being sued in the United States by the provincial government of Marinduque, Barrick offered to settle the case for $20 million in 2013. The settlement offer, which included conditions such as a prohibition on the use of the money for environmental remediation at the site, was rejected and the case remains unresolved.
In 2003 Barrick's plan for a cyanide leaching gold operation at Lake Cowal in New South Wales was met with protests and threats of lawsuits. Another challenge for the company was the disclosure of toxic leaks from a tailings dam at a mine in Western Australia co-owned by Barrick. Members of the Wiradjuri Nation, saying their sovereignty over the land was never ceded and they never gave approval to Barrick, filed suit against the project. The company, nonetheless, initiated production a Lake Cowal, but in early 2015 it announced plans to sell the mine.
In 2011 Barrick was fined A$140,000 for workplace safety violations in connection with the death of a worker at the Kargoolie mine, a 50-50 joint venture with Newmont Mining.
Latin American Operations.
Argentina. In 2007 Barrick said it was abandoning plans for a gold mine high on Mt. Famatina in the province of La Rioja in the wake of widespread community protests and a corruption scandal involving the provincial governor who was supporting the project.
Chile-Argentina. In 2005 Barrick created a controversy when it said it would relocate three glaciers as part of its proposed Pascua Lama gold mining mega-project in the Andes Mountains along the border of Chile and Argentina. Police were reported to have attacked protestors who were delivering petitions and placing symbolic chunks of ice outside the government palace in Santiago. The Chilean government allowed Barrick to proceed on the condition that it leave the glaciers alone, though environmental groups continued to oppose the project, using tactics such as a people's tribunal and road blockades to highlight their criticisms.
A 2010 report by Chile's national water commission found that Barrick's construction activities at the site could cause damage to the glaciers. That risk was highlighted in a 2011 protest held by Greenpeace on the road to the mine site. Barrick challenged the Argentine law protecting the glaciers but the legislation was upheld by that country's supreme court. In 2013 Chile's environmental agency fined Barrick the equivalent of $16 million and ordered it to suspend work for at least a year to address pollution issues at the project, which by this point had a price tag of more than $8 billion. Drawn-out court proceedings and more regulatory challenges have caused the company to keep the project on hold.
Dominican Republic. Barrick faced opposition when it sought to reopen and expand an open-pit gold mine in the Sanchez Ramirez province it had inherited through the acquisition of Placer Dome. A 2012 clash between police and protesters near the Pueblo Viejo mine left dozens injured. Operated as a joint venture with Goldcorp (Barrick has 60 percent), the mine is now one of Barrick's core gold operations.
Peru. In 2006 protests over working conditions at Barrick's Pierina Mines resulted in the deaths of two persons at the hands of police. One person was killed and four injured by police during a 2012 demonstration calling on the company to deal with water shortages in the community allegedly caused by the mining operation. Water was also a key issue for protesters who in 2013 set up blockades on roads leading to Barrick's other Peruvian mine, Lagunas Norte. Production at Pierina is based phased out.
Since Barrick took over the huge Goldstrike mining and processing complex in Nevada in the 1980s, there has been controversy over the environmental impact of the operation. In 2005 the New York Times published a front-page story using Goldstrike as a prime example of how gold mining was intensifying the state's water supply problems while generating more toxic mercury waste than any other industry. The article noted that Goldstrike was draining 10 million gallons of water a day from northern Nevada's aquifer.
For decades the Western Shoshone peoples have protested encroachment by the federal government on lands they had been granted in the 1863 Treaty of Ruby Valley. Some of the land was leased at artificially low rates to mining companies. One of the most lucrative sites was the Cortez gold mine near Elko, Nevada. After the discovery of a large new ore body in the early 1990s, Placer Dome sought to expand open-pit mining operations to the Mt. Tenabo and Horse Canyon areas, which are important spiritual and cultural sites for the Western Shoshone. In 2008 the Te-Moak Tribe, the Western Shoshone Defense Project and Great Basin Mine Watch filed a federal lawsuit against the expansion, but the long-running litigation failed to stop the project, which Barrick inherited after acquiring Placer Dome.
Groups such as the Progressive Leadership Alliance of Nevada also criticize Barrick for paying "next to nothing in taxes" on its mining operations in the state. Barrick, like other hardrock miners, continues to take advantage of the antiquated 1872 federal mining law that allows companies to buy resource-rich public land at no more than $5 an acre and extract gold, silver, uranium, etc. without paying federal royalties.
In 2010 two workers at Barrick's Goldstrike operation in Nevada were killed while attempting to clear an obstruction in an aggregate delivery pipe. The Mine Safety and Health Administration found that management was responsible for the deaths and proposed fines of $447,600. Barrick initially challenged the penalties but in 2015 consented to them.
In 2013 three Barrick American subsidiaries resolved U.S. Environmental Protection Agency allegations that they incorrectly reported their toxic releases by agreeing to pay $278,000 in fines and spend an additional $340,000 to identify metal compounds formed in the Cortez mine oxide mill process.
In 2015 Barrick Goldstrike agreed to pay $196,000 to settle EPA and state allegations that it illegally treated and disposed of toxic mercury waste without the required permit.
Other Information Sources
Violation Tracker summary page
Watchdog Groups and Campaigns
Key Books and Reports
Barrick: Minería responsable de destruir los glaciares (Greenpeace Argentina, July 2011).
Barrick's Dirty Secrets: Communities Worldwide Respond to Gold Mining's Impacts (CorpWatch, May 2007).
Barrick's Glaciers: Technical Reports on the Impacts by Barrick Gold on Glaciers and Periglacial Environments at Pascua Lama and Veladero (Center for Human Rights and Environment, May 2013).
Debunking Barrick (Protestbarrick, April 2013).
El Mal: El Modelo K y La Barrick Gold by Miguel Bonasso (Editorial Planeta, 2011).
Gold's Costly Dividend: Human Rights Impacts of Papua New Guinea's Porgera Gold Mine (Human Rights Watch, February 2011).
Mining Conflicts Around the World: Common Grounds from an Environmental Justice Perspective (EJOLT Report No. 7, September 2012).
Private Gain, Public Loss: Mailbox Companies, Tax Avoidance and Human Rights (SOMO, July 2013).
Undermining Rights: Forced Evictions and Police Brutality Around the Porgera Gold Mine, Papua New Guinea (Amnesty International, February 2010).
Undermining the Poor: Mineral Taxation Reforms in Latin America (Christian Aid, September 2009).
Last updated May 4, 2015