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CEDHA Files Equator Principles Due Diligence Review to US EXIM Bank and EDC of Canada on Barrick’s Pascua Lama Project

CEDHA
November 25th, 2011

The Center for Human Rights and Environment (CEDHA), along with several local and international groups presented today an Equator Principles Due Diligence Review to two export credit agencies considering financing Barrick Gold’s highly controversial Pascua Lama gold project, straddling the border between Chile and Argentina.

The review argues that Pascua Lama is in direct violation of the Equator Principles, which are global norms laying out conditions for responsible investment.

The 45 page critique of Barrick’s Pascua Lama project, brings together existing and new evidence showing innumerable social and environmental norms violations by Barrick’s operations at both Pascua Lama (which is set to commence in the near future) as well as at the adjacent project Veladero, also by Barrick.

The executive summary of the review states,

“This report reveals serious project design and implementation flaws of Barrick’s Pascua Lama Project, making this project non-compliant with the principles and minimum social and environmental standards established by the Equator Principles. This conclusion is based on the analysis of a number of issues and dimensions of both the Pascua Lama and adjacent Veladero projects, which are intricately related, including Barrick’s impacts and problems related to:

Glaciers
Waterways
Indigenous rights
Wetland systems (vegas systems)
Project design (such as faults in rock pile design and execution)
Non-compliance of, and attack on, environmental legislation
Transparency and disclosure
Corporate culture
And multiple other issues.”

As Equator Principle signatory banks, says CEDHA and the adhering institutions, including the global network Banktrack and the Accountability Project of the United States, due to the various impacts sited in this report, and for Barrick’s systemic irresponsible corporate culture evidenced by accidents such as the recent rock pile collapse at the Veladero project, Barrick Gold fails to comply with the Equator Principles, and as such, EDC and Eximbank should stay away from Pascua Lama.

“We believe that a due diligence review of Pascua Lama will be sobering for EDC and Exim Bank and reveal a company that makes hollow commitments to the financial institutions at which it seeks support, and then only shirk its obligations once loans are disbursed”, states the review.

A few weeks ago, Exim Bank and EDC made a locally unannounced visit to the project, and met with several actors including CEDHA to discuss concerns over Barrick Gold’s highly controversial project.

CEDHA employed a similar strategy several years ago, when several EP banks were considering finance to two controversial pulp mills (Botnia and ENCE) on the border between Argentina and Uruguay. Complaints then went to ING, Calyon, and other Equator Principle signatory banks. A few weeks after the complaint, ING withdrew US$480 million of pledges support to the Finnish company Botnia.

Link to the Equator Principles Due Diligence Review:
http://wp.cedha.net/wp-content/uploads/2011/11/Equator-Principles-Due-Diligence-Review-Barrick-Gold-Pascua-Lama-English.pdf

For more information:
Jorge Daniel Taillant
jdtaillant@cedha.org.ar
cel: +54 9 351 507 8376

 

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