MAC: Mines and Communities

Colombia's gold fever

Published by MAC on 2008-03-24

Colombia's gold fever- Fiebre del oro en Marmato

24th March 2008

For more than 500 years, 'subsistence' gold mining created a distinct community

in Colombia's Marmato district. But, five,years ago, its roots were shaken, when a subsidiary of Toronto-based Colombia Goldfields Limited, began to "consolidate" ownership of the mountain, leading to the "economic forced displacement" of Marmato and the social eradication of a working community.

Marmato's Gold Bonanza

Canadian Mining Firm Involved in 'Economic Forced Displacement' in Colombia

By MichealTuathail, The Dominion, Canada

18th March 2008

MANIZALES, COLOMBIA - Uncertainty prevails on the cobbled streets of Marmato - a

small mining town of some 8,000 souls clinging to the side of El Burro, a mountain in the Colombian Andes. For more than 500 years, 'subsistence' gold mining created a distinct community that based its living, traditions, and legends deep in the mountain's dank corridors. Mining the gold of Marmato defines the Marmateño condition. Five years ago, its roots were shaken, however, when the Compañía Mineras de Caldas, a subsidiary of Toronto-based Colombia Goldfields Limited, began its project of consolidating ownership of the

mountain, leading to what many call the "economic forced displacement" of Marmato and the social eradication of a working community.

Colombia Goldfields, the company's website announces, is "rediscovering the land of the golden mountain" through two major projects in the region; the Marmato Development Project and the Caramanta Exploration Project, located approximately seven kilometres apart, hold at least 5.3 million ounces (over 150 tonnes) of gold.

There is more to Marmato than gold, however. In 1982, the Colombian government recognized the town as a national historic site, due to its centuries-old mining tradition and unique history and culture. The first to mine El Burro were indigenous peoples, including Cartamas and Quimbayas. Later, the Spanish Conquest brought to Marmato the first African slaves through the port of Cartagena. In 1825, the liberator Simon Bolivar conceded the mines to England as collateral for loans that would fund the war of independence from Spain. Marmato holds a celebrated place in Latin America's history.

The distinct Marmato condition courses through the veins bored through El Burro. The life of the miners, characterized by the eternal darkness of the mines, the ever-presence of death, and the constant drone of the mills, has influenced the imagination.

Historical and cultural importance aside, Colombia Goldfields' literature portrays Marmato as "a world-class asset" and their "latest success story." In the Medellin newspaper El Colombiano, the project merited the description "the Cerrejonn of gold," a reference to the world's largest open-pit mine located on

Colombia's north coast, controversial because of its environmental costs and the violent displacement of communities that preceded development. The same article

claims that an open-pit gold mine at Marmato would be "one of the largest in South America," requiring the removal of "between 30,000 and 60,000 tonnes of earth daily in order to produce 250,000 ounces of gold annually." The operation would exploit in 20 years what small miners could in 200.

While small mining practices are notorious for their use of harmful chemicals such as cyanide, open-pit mines are environmental disaster zones, according to critics, who say they bring limited short-term employment and leave behind gigantic holes in the ground where communities once lived.

The Colombian government is actively supporting large mining operations, which it claims bring foreign investment to a country where armed conflict and the threat of Latin America's longest-surviving guerrilla insurgency, the FARC (Revolutionary Armed Forces of Colombia), has kept many investors away. Since his inauguration in 2002, Colombian President Ãlvaro Uribe has made it his personal crusade to portray to foreign investors and the world that he has the Colombian insurgency on the run.

A strong military presence throughout the country and pro-business legislation have made the Uribe government the star champion of neoliberal reforms in Latin

America. The Mining Code of 2001, for example, includes shockingly low four percent royalty rates. Further business-friendly reforms are currently awaiting

approval in Congress, and free trade negotiations with the US, Canada and the Scandinavian countries are in full swing. The message to investors is clear: Colombia is open for business.

The Shock of Cold, Hard Cash

Colombia Goldfields arrived in Marmato approximately five years ago, developing what it refers to as "a multi-million ounce gold resource […] through a program

of property acquisitions, community resettlement and exploration." Yamil Amar Catao, president of the Marmato Pro-Defence Committee, a grassroots organization opposed to the company's plans, recounts the arrival of the company: "[The miners] had never seen so much money in one place. They only know pesos. The dollars flashed in their faces were part of a plan to destabilize the community."

Indeed, most have sold their mines. According to Colombia Goldfields, the company has acquired 95 percent of legal mines in the Zona Alta, an area dedicated by a 1954 decree to small or 'subsistence' mining. In January 2008, the company won a bid for Mineras Nacionales S.A., which employs close to 700 people and exploits the Zona Baja, an area allocated for medium-sized operations. Such large-scale acquisitions are unprecedented in Marmato.

Diego Ruaz, a lawyer, miner and representative of the Colombian Federation of Small Miners (FENAMICOL), is concerned with the company's behaviour. "In Marmato, when a mine is bought, it is closed. Mills are bought and destroyed. The local economy is going backwards, and for the first time, people are unemployed. Hunger, prostitution, and poverty are all that is left."

Purchasing mines is not a crime. "The company has a right to invest in Marmato,"

Ruaz adds. "But the community also has rights. The company and the government have ignored [the social problems associated with unemployment]. The community is left to deal with that on its own."

Talking with Marmateos, resentment towards multinationals is not overtly apparent. For years, especially when gold prices are high, various companies have come and gone, leaving their technologies as "gifts" and the community intact.

"We are not enemies of capital," explains Catao. "But we are worried because there was never any mention of an open-pit mine [when the company first arrived]. Now, the people are totally paralyzed. That is why we are mobilizing."

A "High-Risk Zone": the Government Lends a Hand

In recent years, numerous strategies have been used in attempts to force Marmateos out of Marmato: the sudden suspension of dynamite sales to small mining cooperatives, a concerted attempt to deny legalization of small mining operations without titles, new laws threatening expropriation of small mines if such a move is deemed in the 'national interest,' and others.

The winter rains of 2006 caused a landslide that tore through Marmato's historic centre. Fortunately, no one was killed, but several buildings were left in ruins. Studies were ordered, and Ingeominas, the state geological agency, declared the area a "high risk zone." Those same studies concluded that geological instability could be addressed through mitigation projects, yet Ingeominas and the government continue to push for the relocation of Marmato. Colombian Senator Jorge Robledo regards the government's concern for Marmato's safety as suspicious, given that "millions of Colombians are living at risk" of geological instability. Robledo believes the real motives for displacing Marmato is for Colombia Goldfields' mining project. If this is the case, he argues, "those costs should be assumed by the company, which would be enriched by the eradication." With the declaration of a "high-risk zone," however, the Colombian government, not the company, will pay for relocation. The government has built a new school, hospital, mayor's office, and several small, tin-roofed dwellings in the neighbouring community of El Llano, the proposed 'New Marmato'.

Prior to the 2006 landslide, Ian M. Park, president of the Compania Mineras de Caldas, the Colombia Goldfields subsidiary, stated "we are willing to help the community but with the help of the government, because I'm not going to take the entire social responsibility." The company has since hired a sociologist and contracted an NGO to promote alternative economic activity, such as agricultural production and tourism.

"I have never seen an example of a community of miners transformed into farmers," Ruaz argues. "And what tourism will there be with an open-pit mine?" Social responsibilities aside, residents of Marmato are vehemently opposed to their displacement. "We don't want what [the government and the company] are offering us," states one miner. "We don't want a nice big school or a new office for the mayor. We only want what we already have. But here!"

Community consultations have been non-existent. On February 21, 2008, a public forum was held in Marmato. Colombia Goldfields and the Minister of Mining were invited to address the community directly. The company sent low-level functionaries, who refused to discuss the project directly. The minister did not attend. According to Ruaz, "the forum was their opportunity to respond honestly to the concerns of the community, and they simply refused."

Uncertainty Prevails

As the consolidation of property in Marmato nears completion, it is thought that unemployment and misery will force those who remain in the town, those not directly involved in the mining economy, to leave behind their businesses, schools and homes - not to mention their history, culture and identity - to join the nearly four million displaced Colombians that currently surround the country's metropolitan centres. Relocation to El Llano would place the community within walking distance to an open-pit mine and is thus widely rejected.

Miguel Alberto Giraldo, the son of a Marmateño historian and former mayor, sums up what one can clearly sense in Marmato's streets: "Marmato doesn't exist for Marmateños anymore. They'll all have to go, but how, where and when? […] For me, this whole thing is forced displacement through unemployment and apocalyptic threats of total disaster."

As the bedrock of El Burro cracks with the shocks of dynamite, so too does Marmateos' identification with place, that which has held the community together for hundreds of years. With more of its inhabitants seeking more precarious work in other sectors and in other parts of the country, the community itself is splitting, fragmented from the shocks of a few thousand dollars and what appears to be government indifference.

"If they are doing this to Marmato," states Senator Robledo, "they can do this to any community in Colombia." Robledo believes the Canadian multinational is participating in setting a dangerous precedent.

Micheal à Tuathail is a freelance journalist and translator based in Edmonton, Canada. He is also a member of La Chiva, an Alberta-based collective working in

solidarity with Colombian social movements and communities.

Colombia Goldfields targets early 2009 for Marmato feasibility

By Anthony Esposito (

4th March 2008

Torontonian Colombia Goldfields aims to complete a feasibility study in early 2009 for its Marmato Mountain project in Colombia, company VP of corporate development Martti Kangas told BNamericas.

A precursor to the feasibility, a scoping study, is set to be completed this year, Kangas said. At the end of 2007 Colombia Goldfields had five drills operating at Marmato Mountain and some 17,500m have been drilled so far this year, the company reported, adding that the drilling is part of a 60,000m program planned for completion by the end of 2008 at the Zona Alta area of the property.

The drilling is aimed at converting a 5.3Moz gold historical resource into a NI 43-101 compliant resource.

The resource estimate should be complete by the end of the first quarter or possibly the beginning of the second quarter, according to the company official, who added that the exploration budget is likely to be about US$20mn.


At the end of January Colombia Goldfields won an auction to acquire Colombia's Mineros Nacionales, which owns the Zona Baja area of Marmato Mountain. Colombia Goldfields made a cash offer of US$35mn and has deposited a guarantee of US$2.5mn for the transaction.

According to Kangas, the company intends to go forward with the acquisition but would need to arrange financing, which would likely be a combination of equity and debt. "When we raise money it would not only be for the purchase of Mineros

Nacionales, but we also have more exploration to do, and land acquisitions," he added.

Mineros Nacionales operates an 800t/d underground mine that produces some 25,000oz/y gold at Zona Baja.

Colombia Goldfields espera factibilidad de Marmato para comienzos del 2009

24 de Marzo 2008

Por Anthony Esposito (

La compañía de Toronto Colombia Goldfields pretende llevar a cabo un estudio de factibilidad a comienzos del 2009 en su proyecto colombiano Marmato Mountain,

dijo a BNamericas su vicepresidente de desarrollo corporativo, Martti Kangas. Para ello debiera quedar listo primero un estudio de alcance este año, según el ejecutivo.

A fines del 2007 Colombia Goldfields tenía cinco perforadoras en operación en

Marmato Mountain, donde ha perforado cerca de 17.500m a la fecha, indicó la empresa y agregó que estas actividades forman parte de un programa de 60.000m que debiera concluir a fines del 2008 en la Zona Alta.

Las perforaciones apuntan a convertir los recursos históricos de 5,3Moz de oro en un recurso que cumpla con la norma NI 43-101.

La estimación de recursos debiera concluir de aquí a fines del primer trimestre o comienzos del segundo, según el ejecutivo, quien agregó que el presupuesto de exploración debiera bordear los US$20mn.


A fines de enero Colombia Goldfields se adjudicó una subasta para adquirir la empresa colombiana Mineros Nacionales, propietaria de la Zona Baja de Marmato Mountain. Colombia Goldfields presentó una oferta de US$35mn y depositó una garantía de

US$2,5mn por la transacción. Según Kangas, la firma pretende llevar a cabo la

adquisición pero necesita estructurar un financiamiento, que consistirá probablemente en una combinación de deuda y emisión de capital.

"Cuando busquemos financiamiento no será solo para la compra de Mineros Nacionales; también tenemos que explorar más y adquirir propiedades", explicó. Mineros Nacionales opera una mina subterránea de 800t/d que produce cerca de 25.000oz/a de oro en Zona Baja.

Home | About Us | Companies | Countries | Minerals | Contact Us
© Mines and Communities 2013. Web site by Zippy Info