MAC/20: Mines and Communities

Argentina: Yamana Gold and Andalgala - A dubious integration

Published by MAC on 2021-04-15
Source: El Algarrobo Assembly, PRNews, Mining.com

Thousands marched to reject a new mining offensive.

Yamana Gold, Glencore and Newmont are taking advantage of the covid pandemic to try to impose the Agua Rica project to the people of Andalgalá, Belén and Santa María in Catamarca province, Northern Argentina. By reading recent corporate announcements, one would tend to believe that Agua Rica is now a "low risk brownfield copper project with strong economics, simplified permitting and a reduced environmental footprint". Timely press releases include nice words like partners, integration, synergies, agreement, high-quality, unique.

However, last weekend, a crowd of more than 4000 people marched through the streets of Andalgalá to reject the government's mining offensive, which included deploying dozens of gendarmes. Residents organized in the El Algarrobo Assembly also maintain selective blockades on the roads to Potrero and Choya, the two access for drilling vehicles to go up the mountains. "Yamana is violating resolutions 208 and 209 that established the prohibition of mining traffic issued by the Ministry of Mining in 2009", Primera Fuente news site reported.

Agua Rica is a large-scale copper and gold deposit located approximately 35 kilometres from the Bajo La Alumbrera mine, which is now in the process of closure. Yamana owns 56.25% of Agua Rica, with Newmont and Glencore owning 25% and 18.75% interests. Agua Rica's feasibility study is expected to be completed by 2022. Yamana acquired interest in the project when it took over Northern Orion Resources back in 2007, which then holded a minority stake in Alumbrera. See: 2004-10-03 Xstrata's "best practice" in Argentina.

Renamed MARA, Agua Rica and Alumbrera integration seeks to combine the existing plant and related infrastructure (icluding the infamous 320 Km concentrates pipeline and the cracked tailings dam) formerly used to process and transport Alumbrera's ores during its mine life. Yamana executive chairman Peter Marrone recently said: "The integration effectively turns what was a greenfield project into a much lower risk brownfield project. Leveraging existing infrastructure enhances project economics, simplifies permitting, and reduces the project’s environmental footprint, thereby significantly enhancing the value of the project."

Problem is, that same infrastructure has been proven to be an environmental calamity for Catamarca, Tucumán and Santiago del Estero provinces. See 2012-02-20 Alumbrera in distress and 2005-10-06 Minera Alumbrera accused of co-responsibility in Río Hondo Reservoir pollution Social oposition is not new either. In February 2010, a judge halted work at the Agua Rica site after violence erupted during protests. See 2010-02-23 Judge Suspends Yamana's Agua Rica Project After Clashes in Andalgala, Argentina

Then in September 2016, the Deliberative Council of Andalgalá unanimously approved Ordinance 029 banning open pit mining in the basin of the homonymous river. The measure aimed to protect the Aconquija mountain range and prohibited the use of water from the river, springs or subsurface aquifers for mining activities. It took fifteen years of political mobilization for the local assemblies to achieve that environmental protection Ordinance. See 2016-09-12 Argentina: Andalgala Deliberative Council bans mining

For some time, copper prices were low and not much happened. Then five years later, on December 23, 2020, court ruling 48/2020 issued by the High Court of Justice of Catamarca declared Ordinance 029 as unconstitutional, to favor the mega-mining enterprise (link provided by Lorena R. Schrott from ocrn.info). The highest tribunal of the province gave credit to an unconstitutionality action filed by Yamana against the Municipality of Andalgalá, as if protecting the environment were not under its prerogatives. In addition, after four years entertaining the case, the court decided to impose the costs of the process on the municipality, which must now pay the company attorneys' fees. The ruling is being appealed by Eduardo Córdoba, current mayor of Andalgalá.

In November 2019, Agua Rica presented a new EIA for the “Advanced exploration stage 2020 drilling program”. By virtue of the new legality generated by the ruling contrary to ordinance 029, the province authorized the drilling of 11 wells in the Aconquija mountains. In the midst of the pandemic, the provincial Mining Ministry launched a public consultation mechanism within the framework of the Citizen Participation Program adapted to the sanitary emergency. Through Resolution 310/20, the Mining Secretariat approved the Advanced Exploration Environmental Impact Report and authorized Minera Agua Rica to carry out the works. At the same time, a note accompanied by more than 6000 signatures in favor of mining development in the department was presented to the Deliberative Council. No administrative body verified the validity of those signatures.

In January 2020, just after assuming the presidency, Alberto Fernández met with the governors of San Juan and Catamarca, along with representatives of the companies Lundin Gold and Yamana Gold.

Yamana also operates Cerro Moro and Newmont operates the Cerro Negro mine, both in Santa Cruz province. Yamana Gold is the owner of the Suyai gold project in Esquel, Chubut province.

See also:

2020-11-18 Argentine Government Zooms-in on large scale mining

2020-10-20 30,000 signatures for the protection of water in Chubut, Argentina

The people of Andalgalá responds to the violence of the Provincial State

El Algarrobo Assembly Statement

https://www.biodiversidadla.org/Noticias/A-la-violencia-del-Estado-Provincial-el-pueblo-de-Andalgala-responde

April 12, 2021

Faced with the subjugation of our fundamental human rights and the systematic violation of laws, during a massive march the people of Andalgalá expressed their outrage at the offices of Agua Rica and the headquarters of the Frente para la Victoria party, symbolic centers of the State mining-repressive apparatus.

These incidents show that the people are tired of manipulation and that there is no social license. Beyond the fact that we understand the anger caused by the illegal initiation of advanced exploration activities carried out by MARA, former Agua Rica mining company, from the El Algarrobo Assembly we deny any connection with the violent incidents that occurred this afternoon.

In addition, we publicly denounce the Police for liberating the area and sending infiltrators who began the attacks against the property where Agua Rica installed its offices. Where were the 60 policemen who came from the capital at the time of the riots?

We point out that political operators took advantage of the situation and incited the protesters to move the violence to other parts of the city, while members of the Assembly acted to dissuade them.

As everyone in Andalgalá knows, for eleven years and 584 walks, the different citizen assemblies, including the El Algarrobo Assembly, and other citizens who oppose mega-mining, have peacefully demonstrated through the streets of our town to demand the immediate stoppage of activity in the Agua Rica project.


Yamana completes Agua Rica and Minera Alumbrera integration

Canadian miner Yamana Gold has completed the integration of the Agua Rica project with the Minera Alumbrera plant and associated infrastructure in Argentina.

https://www.mining-technology.com/news/yamana-completes-integration-of-agua-rica/

21 December 2020

The integrated project will be now known as the MARA Project.

Located in the Catamarca province of Argentina, Agua Rica is a large-scale copper, gold, silver, and molybdenum deposit. It is situated 25km north of Andalgalá.

It is estimated to contain proven and probable mineral reserves of about 7.4 million ounces of gold and 11.8 billion pounds of proven and probable copper mineral reserves.

According to the company, the integration creates ‘significant synergies’ by combining existing infrastructure which was formerly used to process Alumbrera mine’s ore during its mine life.

Yamana executive chairman Peter Marrone said: “The integration effectively turns what was a greenfield project into a much lower risk brownfield project. Leveraging existing infrastructure enhances project economics, simplifies permitting, and reduces the project’s environmental footprint, thereby significantly enhancing the value of the project.

“With the MARA Project, the critical development components of plant and related infrastructure already exist, which improves the development risk profile and quality of the project. We are very pleased to have worked with our partners, Glencore and Newmont, on the integration, and we look forward to working with them on the development of the project.”

Yamana and Alumbrera partners have created a new joint venture (JV) in which Yamana owns a 56.25% controlling interest, Glencore holds a 25% interest, and Newmont owns the remaining 18.75% stake.

Yamana noted that it will serve as the operator of the JV and will work towards completion of the feasibility study as well as EIA for the MARA Project.


Yamana Gold lowers risk at Agua Rica in Argentina

MINING.COM https://www.mining.com/yamana-gold-lowers-risk-at-agua-rica-in-argentina/

December 18, 2020

Yamana Gold announced the completion of the integration of the Agua Rica project with the Minera Alumbrera plant and infrastructure. Moving forward, the integrated project will be known as the MARA Project.

According to the company, the integration creates significant synergies by combining existing infrastructure which was formerly used to process ore from the Alumbrera mine during its mine life, including processing facilities, a fully permitted tailings storage facility, pipeline, logistical installations, and ancillary buildings, with the future open pit.

Agua Rica is a large-scale copper, gold, silver, and molybdenum deposit located in the province of Catamarca, Argentina, with proven and probable gold mineral reserves of 7.4 million ounces, while proven and probable copper mineral reserves of 11.8 billion pounds.

“The result is a significantly de-risked project with a smaller environmental footprint and improved efficiencies, creating one of the lowest capital intensity projects in the world as measured by pound of copper produced and in-situ copper mineral reserves, with further potential for optimization and upside,” Yamana said in a press release.  

“The integration effectively turns what was a greenfield project into a much lower risk brownfield project,” said Peter Marrone, Yamana’s executive chairman.

“Leveraging existing infrastructure enhances project economics, simplifies permitting, and reduces the project’s environmental footprint, thereby significantly enhancing the value of the project.”


Yamana Gold, Glencore and Goldcorp Enter Into an Agreement for the Integration of Agua Rica and Alumbrera

https://www.prnewswire.com/news-releases/yamana-gold-glencore-and-goldcorp-enter-into-an-agreement-for-the-integration-of-agua-rica-and-alumbrera-300808997.html

Mar 7, 2019

VANCOUVER, March 7, 2019 /PRNewswire/ - GOLDCORP INC., Yamana Gold Inc. ("Yamana") and  Glencore International AG ("Glencore") are pleased to announce the signing of an integration agreement (the "Agreement") pursuant to which the Agua Rica project would be developed and operated using the existing infrastructure and facilities of Minera Alumbrera Limited ("Alumbrera") in the Catamarca Province of Argentina.

The Parties believe the integration of the Agua Rica project and the Alumbrera mine (the "Integrated Project") has significant merit given the proximity of the assets, and the potential to realize significant synergies by taking full advantage of existing infrastructure associated with the Alumbrera mine for the development and operation of Agua Rica.

Agua Rica hosts a large scale, long life copper mineral resource with associated gold, silver, and molybdenum while the Alumbrera infrastructure is of significant scale and configuration that is ideally suited for the integration plan.

Preliminary studies show the potential for a mine life in excess of 25 years at average annual production of approximately 236,000 tonnes (520 million pounds) of copper-equivalent metal(1), including the contributions of gold, molybdenum, and silver, for the first 10 years of operation.

This is based on the Agua Rica mineral reserve(2) estimated to contain proven and probable mineral reserves of approximately 4.5 million tonnes  (10 billion pounds) of copper and 6.5 million ounces of gold contained in approximately 910 million tonnes of ore.

The Agreement represents a significant step forward towards the optimization of Agua Rica. The Alumbrera infrastructure, including the existing infrastructure for concentrate logistics located in northern Argentina between the mine site and the port, presents a unique opportunity to enhance project economics while also reducing both the project complexity and environmental footprint.

The Parties have established a Technical Committee to direct the review and evaluation of the Integrated Project. It is expected that a pre-feasibility study for the Integrated Project will be completed in 2019 and that a full feasibility study with updated mineral reserve, production and project cost estimates will be completed by 2020.  This will provide the framework for the submission of a new Environmental Impact Assessment ("EIA") to the authorities of the Catamarca Province and for the continued engagement with local stakeholders and communities.

The Parties have been working together with key government stakeholders to support a path forward for the evaluation and development of the Integrated Project.  An agreement has been reached with the Catamarca state mining company, Catamarca Minera y Energética Sociedad del Estado ("CAMYEN"), in respect to CAMYEN's participation in the Integrated Project.

The Catamarca Province has approved a closure plan for the progressive reclamation of the Alumbrera mine that synchronizes with the advancement of the Integrated Project and is funded with existing cash of Alumbrera on reserve for reclamation activities. Yacimientos Mineros de Agua de Dionisio ("YMAD") has indicated its support for the use of the Alumbrera infrastructure for the Integrated Project.

Finally, the National Government implemented a mechanism that was pending since the 2003 reform of the Argentine Mining Investments Law, which sets out the framework for refund of amounts paid in excess of a mining project's overall tax burden, at a federal level. This supports fiscal stability of mining projects in the country, and the Integrated Project specifically, as it advances.

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