Rosa Tanguila, a Quechua indigenous woman, cleaning up the pollution caused by Texaco in a stream in her community, Rumipamba, in Ecuador’s Amazon jungle region. Credit: Gonzalo Ortiz/IPS

By Stephen Leahy
UXBRIDGE, Canada , May 18 2014 (IPS)

Conflicts with local communities over mining, oil and gas development are costing companies billions of dollars a year. One corporation alone reported a six billion dollar cost over a two-year period according to the first-ever peer-reviewed study on the cost of conflicts in the extractive sector.

The Pascua Lama gold mining project in Chile has cost Canada’s Barrick Gold 5.4 billion dollars following 10 years of protests and irregularities. No gold has ever been mined and the project has been suspended on court order.

And in Peru, the two billion dollar Conga copper mining project was suspended in 2011 after protests broke out over the projected destruction of four high mountain lakes. The U.S.-based Newmont Mining Co, which also operates the nearby Yanacocha mine, has now built four reservoirs which, according to its plan, are to be used instead of the lakes.

“Communities are not powerless. Our study shows they can organise and mobilise, which results in substantial costs to companies,” said co-author Daniel Franks of Australia’s University of Queensland, who is also deputy director of the Centre for Social Responsibility in Mining.

“Unfortunately conflicts can also result in bloodshed and loss of life,” Franks told Tierramérica.

The study is based on 45 in-depth, confidential interviews with high-level officials in the extractive (energy and mining) industries with operations around the world.

“Conflict translates environmental and social risk into business costs” was published May 12 in the Proceedings of the National Academy of Sciences (PNAS). A special report “Costs of Company-Community Conflict in the Extractive Sector” based on the study is also available.

“We wanted to document the costs of bad relationships with communities. Companies aren’t fully aware and only some investors know the extent of the risk,” Franks said.

“If companies are interested in securing their profits then they need to have high environmental and social standards and collaborate with communities,” Franks said in an interview.

Investing in building relationships with communities is far less costly than conflict. Local people are not generally opposed to development. What they oppose is having little say or control over how development proceeds, he added.

“We want development that benefits indigenous people and doesn’t just benefit someone’s brother-in-law,” said Alberto Pizango, president of the  Interethnic Association for the Development of the Peruvian Rainforest (AIDESEP), an indigenous rights organisation in Peru representing 1,350 Amazon jungle communities.

Peruvian indigenous leader Alberto Pizango, who is on trial in connection with the 2009 massacre in Bagua, has at the same time been asked by the Environment Ministry to help plan the next climate summit. Credit: Coimbra Sirica/BurnessGlobal

“Indigenous people have something to say about harmonious development with nature. We don’t want development that destroys our beloved Amazon,” Pizango told Tierrámerica from Lima.

Pizango has been actively resisting the government of Peru’s selling of petroleum concessions to foreign companies on lands legally titled to indigenous people.

The struggle turned violent outside the northern jungle town of Bagua on Jun. 5, 2009, when armed riot police moved to evict peaceful protesters blocking a road. In the clash 24 police officers and 10 civilians were killed.

Pizango and 52 other indigenous leaders were charged with inciting violence and 18 other crimes. They went on trial May 14 in Bagua.

The indigenous people were protesting 10 legislative decrees they considered unconstitutional, which were put in place by the government to foment private investment in native territories.

“We had no choice and thought our protests were fair and that we were right. But it was too high a price. We don’t want to see that again. We want to move from the ‘big protest’ to the ‘big proposal,” said Pizango, who faces a life sentence if he is found guilty.

The study published in PNAS shows that the violence in Bagua could have been avoided if companies and the government acknowledged indigenous rights and worked with local communities.

“It is with great sadness I say this has yet to happen in Peru,” said Pizango, who was not even in Bagua when the violent clash occurred.

Meanwhile, Peru’s Environment Ministry has asked Pizango and AIDESEP to assist in the planning of the big U.N. climate conference to be held in Lima at the end of the year. The indigenous leader hopes the event will show the world that native people can protect the forest and the climate.

Repairing relationships between communities and companies and governments is difficult, said Rachel Davis, a Fellow at the Corporate Social Responsibility Initiative at Harvard University.

“It is much harder for a company to repair its relationship with a local community after it has broken down; relationships cannot be ‘retro-fitted’,” said Davis, a co-author of the study.

Franks compares this to a divorce, pointing out that only rarely do partners remarry.

Leading mining corporations have apparently begun to understand this, and are implementing the U.N. Guiding Principles on Business and Human Rights and adopting the International Council on Mining and Metals Sustainable Development Framework, Davis said in a statement.

But this is not the case in the oil and gas sector. “Their culture is very different. They’re not used to dealing with communities,” said Franks.

The study shows that environmental and water issues are the biggest triggers of conflicts. Activities like hydraulic fracking for unconventional gas and oil are on the rise and are affecting water. Big conflicts are coming, he predicts.

“It’s a good report but doesn’t address the broader economic and political pressure to push projects through quickly,” said Jamie Kneen of MiningWatch Canada.

Shareholders want big returns on their investments and governments want their royalties sooner rather than later. All of this makes corporations less willing to compromise or to take the time to find alternatives that might be acceptable to local people,” Kneen told Tierrámerica.

“Companies know there will be problems with local communities. Companies often gamble that any conflict will not get too high a profile and try to hide this risk from investors,” he added.

Not all conflicts are resolvable, Kneen said. “Some communities will never accept any risk of contamination to their water.”

This story was originally published by Latin American newspapers that are part of the Tierramérica network.

Alberto Pizango (standing) speaking at an event organised by the Interethnic Association for the Development of the Peruvian Rainforest (AIDESEP), which he heads. Credit: Milagros Salazar/IPS

By Milagros Salazar
LIMA, May 16 2014 (IPS)

The trial of 52 indigenous people that just got underway for a 2009 massacre near the city of Bagua in northwest Peru will test the judicial system’s independence and ability to impart justice.

The oral phase of the trial opened Wednesday May 14 in a court in Bagua in the northern region of Amazonas. The next hearing will be held May 26.

The defendants are indigenous leaders and residents involved one way or another in the Jun. 5, 2009 clash between security forces and protesters that left 34 people dead – 24 police officers and 10 civilians – and around 200 injured.

Indigenous people in that Amazon region had blocked a highway near Bagua for two months, demanding the repeal of decrees passed by the government of Alan García (2006-2011) that opened up native territories in the rainforest to oil, mining and logging companies, violating rights guaranteed in the constitution.

Several of the decrees were repealed.

But the bloody incident made headlines around the world.

The 52 people on trial – a 53rd died last year – are facing anywhere from six years to life in prison, one of the defence lawyers, Juan José Quispe of the non-governmental Legal Defence Institute (IDL), told IPS.

The public prosecutor’s office has not yet filed charges against 12 police officers also implicated in the violence, Quispe said.

The bodies of some of the indigenous people killed in Bagua. Credit: Courtesy Fedepaz

But it is demanding a life sentence for seven of the 52 civilians, including indigenous leader Alberto Pizango, president of the Interethnic Association for the Development of the Peruvian Rainforest (AIDESEP), which organised the 2009 protest and roadblock.

“We follow the people’s mandate,” Pizango told IPS a few days before the start of the oral phase of the trial.

After the massacre, Pizango went into exile in Nicaragua. But he returned in May 2010. The other defendants facing a possible life sentence are Santiago Manuim, Héctor Requejo, Ronald Requejo, Danny López, Feliciano Cahuasa and Joel Shimpukat.

According to Quispe, there have been irregularities from the very start. For example, he said, the justice system did not accept the defence’s request to interrogate former president García and several of his ministers.

“The court told us it was not summoning them because they were not eyewitnesses,” the lawyer told IPS. “But this case has political implications.”

One key aspect that must be investigated, said Quispe, is whether the cabinet of ministers knew that, a day before the massacre, the indigenous leaders had sent a letter to the police station in Bagua informing the police that they would peacefully withdraw from the Devil’s Curve, where they had set up the roadblock.

The indigenous leaders say an agreement had already been reached with the police chief that, if the order to dismantle the roadblock came from Lima, the protesters would be warned ahead of time, to allow them to peacefully pull out.

But at 5:00 AM the morning of Jun. 5, 600 heavily armed police swarmed in to disperse the protesters on the Devil’s Curve, a stretch of the road that links the main rainforest cities in northern Peru with the coast.

When they heard that the police had opened fire at the roadblock and that protesters were being killed, the Awajún native demonstrators occupying a nearby oil pumping station – Estación 6 – decided to take reprisals against a group of police posted there.

At the first hearing of the trial, the court did not provide interpreters for the Awajún speakers.

“They needed to take down the full names, place of birth, number of children, incomes of the defendants,” Quispe told IPS. In the end, one of the indigenous leaders, Merino Trigoso, “had to act as interpreter,” he added.

But the failure to supply an interpreter meant the reading of the charges by the public prosecutor had to be suspended, because the 14 defence attorneys – provided by the IDL, the Catholic Vicariate of Jaén, and AIDESEP – demanded that the written document be translated into the Awajún language.

According to Quispe, the president of the court, Gonzalo Zabarburu, made another mistake when he sentenced one of the defendants, Feliciano Cahuasa, to house arrest in a city different from the one already determined by another judge.

“That arbitrary decision affects the defendant, who had already done all the paperwork and taken the steps needed to comply with the order of the other judge, and now has to find a new home, to serve his house arrest,” said Quispe.

Cahuasa, accused in connection with the death of police Major Felipe Bazán during the incident in Bagua, spent nearly five years in prison without a sentence, despite the fact that under Peruvian law the limit is three years. The defence finally managed to get him transferred to house arrest.

The court also made a risky decision by ordering that one of the defendants, Trigoso, be transferred to a police station during a recess in the trial rather than leaving him in one of the rooms in the court building until the hearings began again.

Trigoso was escorted by several police through a large crowd of indigenous family members and supporters anxiously waiting outside the building.

“Something regrettable could have happened because of an absurd order by the judges,” said Quispe. But there were no incidents.

One of the first lessons that Bagua left indigenous communities was that they needed to move from “the big protest to the big proposal, and from the big proposal to the big action, which consists of the full exercise of the right of self-determination of [indigenous] people,” Pizango told IPS.

“The people will never again block highways, because now they know the trap the Peruvian state sets up. If you come out to defend the voice of the people, what you receive is aggression, bullets and a whole system of misinformation,” he added.