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Volume 14, Number 23
December 13, 2008

economy

Also in this section:
Banker expects Panama to be relatively unscathed by economic crisis
Balbina's brother blows EU duty preferences for Panama
New Tribunal de Cuentas
Phone card bill passes House, may boost US-RP calling if Senate approves
ANAM approves Petaquilla permit
Militant labor group celebrates its 10th birthday
Panamanian-American victim may bankrupt KKK faction
Business & Economy Briefs



Area streams silted up from day one of Fifer's gold mine construction. Photo by ANCON

ANAM approves Petaquilla gold mine, people downstream are flooded out
by Eric Jackson

On November 26, about a dozen families in Nueva Lucha de Petaquilla, an Ngobe village down the Petaquilla River from Richard Fifer's Molejon strip mine, were coping as best they could, on their own since the village was flooded out three days over when the Petaquilla River overflowed its banks. These people moved into harm's way when men from Richard Fifer's Petaquilla Minerals came and burned their old houses on higher ground, and help became more remote when this same company destroyed the roads and trails of traditional access to the riverside village and put up a gate to exclude environmentalists, reporters and Liberation Theology religious folks from a vast section of northern Cocle and western Colon provinces.

When Nueva Lucha was flooded, the community sent Merardo Morales and Martín Rodríguez out on foot to summon help. Two days later, after fording several dangerously swollen streams, Morales reached Coclesito and Rodríguez arrived at La Pintada.

There would be no presidential visits, there was no Panamanian government request for US military help and there was no collection at Parque Omar for Nueva Lucha and other communities along the flooded Petaquilla River. President Torrijos has for years, even when Fifer was a fugitive from embezzlement charges, even when Fifer was openly defying the nation's environmental laws, supported Fifer's gold mine project. Torrijos is no friend of this community and he has every expectation of a reciprocal attitude among its residents.

The Red Cross and Julio Yao of the Servicio Paz y Justicia en Panama (SERPAJ-Panama) were the ones who flew in by helicopter several days later, on November 30. "People are mad and desperate, hungry, cold and sick," Yao said of those whom he met on that relief mission.

Meanwhile in Panama City, as the people of Nueva Lucha awaited help, or at least word that someone in the outside world knew of their desperate situation, and a week after the National Environmental Authority (ANAM) had fined Fifer's Petaquilla Gold $1 million for starting the Molejon gold mine without an environmental permit and assessed it $934,694 in damages for the deforestation caused by its road and strip mine site ANAM director Ligia Castro had a political statement to make. She approved an environmental permit for the gold mine.

That decision is likely to be challenged in court.

Leslie Marín, an environmental attorney with the Centro de Incidencia Ambiental (CIAM), pointed out that Panama's public contracts laws provide that non-compliance with agreed terms are cause for automatic terms of a concession contract, and that the fine and costs charged against Fifer's company the week before were precisely for breaches of the clause of the 1997 Petaquilla mining concession requiring the company to obey all environmental laws and take all due precautions.

CIAM and other environmentalist groups had criticized the fine and restitution order that ANAM imposed on November 18 because it was based only on the cost of replanting trees on the lands that Fifer's company had illegally deforested, rather than compensation for degraded water supplies and fisheries caused by the muddy runoff.

The permit granted by ANAM's acceptance of Petaquilla Gold's environmental impact statement requires the company to post two bonds, in the amount of $14,374,000 to cover future environmental damage. It doesn't appear that driving people in western Colon province from their homes, either directly by sending in goons to burn their houses or slightly less directly by ruining water supplies or fisheries upon which they depend or by increasing the risk of flooding by destroying the ability of ecosystems to retain water, are among the damages that the Torrijos administration would have the company cover.

On November 28 Fifer issued a jubilant press release announcing that "wet commissioning of the gold production facility... has begun" and that the first ingots would be poured sometime late in December. This, however, would not be the first, second or even third date for the start of gold production that Fifer has predicted to attract investors.

Fifer plans to crush more than 2,000 metric tons of ore per day, soak it in cyanide, then leach the resulting sludge through charcoal, to which the gold would adhere. The process entails the creation of a leach pad of toxic ore and charcoal, the liquids from which drain into a lagoon of cyanide tainted water, which experiences in many places (including previous gold mines in Panama) tell us would likely to from time to time wash into the local watershed when there are heavy rains.

Fifer's mine manager, Gaston Araja, oversaw the Bellavista open pit gold mine in Costa Rica, which was closed in July of 2007 when the pad in which the cyanide treated ore was leached into charcoal broke down. It was "due to abnormally high rain fall during the past several years," the company said, which in turn caused the toxic heap to slide down a hillside.

Mining Watch, a Canadian environmentalist group, accuses Petaquilla Minerals, Fifer's parent company for Petaquilla Gold, of concealing the risks from the Panamanian people. "Nowhere in its publications has the company disclosed the specific nature and seriousness of the risks it is facing," an alert issued to investors by the group charged. "These issues are of acute interest to Panamanians, especially those affected by the environmental degradation," and to Canadians as well, Mining Watch says, given that the governmental Canada Pension Plan owns a substantial minority stake in Petaquilla Minerals.



Petaquilla stock prices --- to the extent that these mean
much in light of the ongoing market manipulations

Update: Petaquilla's appealing the ANAM resolution
that accepted its environmental impact statement


La Prensa has reported that Petaquilla is appealing the ANAM resolution granting it an environmental permit, lodging objections to 14 of the 40 conditions that the authority demanded before further mine operations could be undertaken.

Immediately after the resolution was made the company had issued a press release hailing the development and promising to begin gold production this month. However, in light of prior unmet predictions of this sort from this source and due to the conditions in the ANAM resolution, many observers in the environmentalist movement, the press, the mining industry and stock markets have discounted this. The appeal will likely augment such skepticism.


Also in this section:
Banker expects Panama to be relatively unscathed by economic crisis
Balbina's brother blows EU duty preferences for Panama
New Tribunal de Cuentas
Phone card bill passes House, may boost US-RP calling if Senate approves
ANAM approves Petaquilla permit
Militant labor group celebrates its 10th birthday
Panamanian-American victim may bankrupt KKK faction
Business & Economy Briefs



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