What is the true cost of gold? Is it paid for in currency per ounce or in the blood, sweat and toil of those who mine it? Or is the ultimate cost paid by the environment which is desecrated to find it?
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A book from the Pulitzer Center, published earlier this year, gets to the heart of this very question. From child miners as young as four in Burkino Faso and the Philippians to teenagers who mine underwater with only a compressor pump for air to the battle between commercial mining companies and disgruntled locals trying to protect the land they call home. These are just some of the stories the book, TARNISHED: The true cost of gold, exposes as part of the true cost of the global gold industry.
The book is made up of individual reports by eleven journalists, many of whom are award-winning, and their first-hand accounts of life mine-side.
One of these journalists, news and documentary producer Stephen Sapienza, travelled to the Madre de Dios region in Peru, South America, in search of artisan miners, who were coming to blows with the government after their mining trenches had been bombed. He details what he learnt while in pursuit of the artisanal gold miners of Peru.
Environmental burden – lush forest turned to desert
It has been estimated that there are 13 – 20 million men, women and children from over 50 developing countries artisanal mining, and that artisanal mining contributes up to 12% or 330 tonnes of annual gold production. In 2009 in Peru, according to the United Nations Environment Programme, 80,000 people worked in the artisanal mining industry directly, while a further 300,000 were dependent on it indirectly. This figure is up from 40,000 people involved in artisanal mining in the 1990s.
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By GlobalData"The scale of informal mining in Peru is gigantic," says Sapienza "You see gold shops everywhere."
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Sapienza, who has previous experience in traditional mining, such as coal mining, in West Virginia, headed to the Brazil and Bolivia bordered district of Madre de Dios in Peru in 2011. The region’s capital, Puerto Maldonado, which used to be a small town known for rubber tree plants, was, at the time, experiencing fast growth due to the Interoceanic Highway that Brazil was building over the Madre de Dios River.
"No matter where you went along the roads you could see either mining activity taking place or support activities for mining. It was on a scale I hadn’t really expected," he says.
The informal mining activity is a way to make ends meets in a country where a large proportion of the population survive on sustenance farming.
One mine Sapienza visited was about "two football pitches wide" and there were 20 – 30 miners toiling away. At this time, the miners had an ongoing feud with the local government and Sapienza and his team were not welcome spectators as the miners were aware any press about environmental issues would likely come back to haunt them.
The extensive damage from the informal mining to the environment, however, was clear to see; the once lush forest floor and tree canopy had turned to desert.
"For me that was really dramatic. It was really hard to comprehend how quickly one of the richest and most bio-diverse places in the world could have areas that are just completely destroyed."
Timber is a big export in the region and Sapienza says mining probably helps escalate this business. He describes talking to a man who had been tasked with looking after a concession of the rainforest, to harvest and sell the trees at the right time. The man experienced a lot of trouble from the artisan gold miners who illegally cut down the trees he was managing so that they could build mines, making forest management impossible.
Other issues, such as a lack of education or adequate tools and technology, mean artisan miners’ techniques can be particularly damaging to the environment.
Health hazards – ignorance to the effects of mercury
The newly built Interoceanic Highway has made it easier for the miners to purchase supplies for their mines, such as petrol and mercury, which are used to extract gold from rocks.
Overexposure to mercury can cause neurological damage, such as negatively affecting cognitive thinking, memory, attention and language.
Sapienza says the artisanal miners he spoke with were unaware of the dangers mercury posed to them and they only thought it was harmful to pregnant women.
It takes two ounces of mercury to extract an ounce of gold which can result in tonnes of mercury being released into the food chain via water over a year.
"Mercury takes some time before it really shows up in people’s food chain and in peoples systems, so it might not be impacting people right away," Sapienza says.
"This is something we know because of how mercury transfers in the food chain it will be magnified and more people will be impacted by this. I think there is definitely a lot more awareness that needs to be made about this."
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One solution to this problem is to look at who is selling mercury to the miners and stop the distribution at the source, Sapienza says.
Social pressures of artisanal mining – upsetting traditional values
During Sapienza’s travels in Peru he visited an indigenous tribe that lived along the Madre de Dios River. The indigenous villagers were making money by leasing their land to artisan miners but, as well as bringing them income, the miners’ presence disrupted their traditional way of life, resulting in a culture clash between older and younger generations.
"There was a split in the community," he says. "The older folks recognised it [artisan mining] was really changing the community now that the young people were coming into money."
This resulted in traditional practises, such as hunting and gathering, falling by the wayside. Many of the young people, including the chief’s son, had satellite TVs.
"There are issues with these miners that come to indigenous tribes. They are mostly single men and young men; they do things differently. I’ve heard they’ll get together with the local women and that causes tension with the other men in the tribe," Sapienza explains.
"There are all kinds of social implications that come along with it: gambling, drinking, stuff that a lot of these tribes don’t have a lot of, or exposure to."
Lack of choices and government oversight
It is very difficult to police artisanal mining due to its unregulated nature and the vast scale at which it is occurring. It is also difficult to convince miners to find other sources of income when gold pays in hard currency.
"For a large portion of people, this is a way to keep their families in some cash," Sapenza says. "These farmers turned miners, in many cases, wish there was an alternative but they don’t see one."
"You have these disenfranchised, very poor fragments of the population who see mining as a way to earn money to buy bread – what is the government role there? That is what the government should be asking itself. It is a problem."
The artisanal miners see government making deals with big corporations and feel that, if the big companies can do it, they should be able to as well, says Sapienza. But are the big corporations more environmentally responsible than the artisan miners?
"In a lot of ways, while big corporations can be destructive to local communities and a concern – a big international corporation has a huge footprint – the companies do get some scrutiny, more scrutiny, I would say, from the media and the government and then from international observers, than these informal miners who are everywhere."
Sapienza visited another small-scale mining site on private land that had never had an environmental inspection. Also, rather damningly, in one area of Madre de Dios River Sapienza visited, there were only four environmental inspectors expected to enforce environmental codes on around 20,000 informal miners.
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"A few years ago, informal miners had huge protests about the government trying to formalise the informal mining in Peru and there were large street protests and four protestors were killed over this issue, explains Sapienza.
"When you look at the type of resistance that these informal miners put up [with], you have to say, what are some alternatives? Even at that time the government were pointing at a group like AURELSA."
Sustainable small scale mining
AURELSA is a mining co-operative in the mountains of Relave, a district of Pullo in the province of Parinacochas, in an area once mined by a large American company.
AURELSA has made a commitment to conduct environmentally safe mining for gold, as well as give back to the community. The relatively large town ("a few thousand people") has pledged no alcohol or gambling and most residents are in some way connected to AURELSA. The company also helps to fund a school and provides health insurance and any kind of death or dismemberment insurance.
AURELSA’s mining method is to blow holes into the mountain rock and take these rocks up in metal rail cars to the side of the mountain. Informal miners still work in the area using very old and crude methods of extraction, such as separating the gold from the rock using really huge stones that they rock back and forwards ("like something from the stone age"), but AURELSA is the biggest operation in town.
Notably, instead of using mercury, the company uses cyanide to extract the gold.
"For me, this was really surprising," says Sapienza. "Because everyone knows cyanide is really dangerous."
The company, Sapienza says, has the cyanide well-contained in a large pit, and once it is used in the process of separating the gold rock, it gets pumped into this large pit and it is recycled again.
"Now, is this 100% environmentally safe because it uses cyanide? Probably not, but is it better than what is happening with a lot of informal miners, and for that matter formal mining operations? The fact [that] they give a percentage of the profits back to the worker and also the community also makes it very progressive."
There are other companies in Peru trying to mine responsibly like AURELSA, but getting artisanal miners to mine safely and to higher environmental standards is still a huge problem. Tracking and tracing gold to make sure it comes from a sustainable source has also proved ineffective in the past.
The recent fall in gold price is believed not to have impacted the appetite for informal mining, with this kind of gold mining still more profitable than living off the land.
"The government and community seem to have very little control over what is going on and where it is happening and who it is happening to. I think a lot of these local communities are really lacking in understanding of their rights and what rights they have to the land or resources below the ground," observes Sapienza.
"I feel like, personally, when I look at a place like Madre de Dious, that is a place that calls out for better use of technology in order to do mapping and to understand concessions and who owns what and what type of activity is going on in those concessions, whether it is an investment by the government or international NGOs."
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