Blinding lure, dirty lucre

Gold has held an allure for humans since time immemorial. One of the core quests of alchemy (before chemistry came to be recognized as a well-established science) was the transmutation of lead to gold. However, notwithstanding the many important insights alchemy did eventually provide to its successor, turning lead into precious gold was not one of them. The saying, “if you can’t grow it or hunt it, you have to mine it”, is true in the case of gold.

The Advanced Land Imager on NASA’s Earth Observing-1 satellite (at an altitude of 705 km Low Earth Orbit, higher than the orbit of the International Space Station at about 400 kms) captured this true-colour image of the Sunrise Dam Gold Mine on December 4, 2009. Located roughly 55 kms south of Laverton, Western Australia, the mine produces roughly 14 tons of gold each year. The main pit’s terraced landscape appears in shades of gray in the left half of this image; and what appears to be a smaller, rectangular pit appears on the right. In 2008, the central pit at Sunrise Dam reportedly reached a depth of 440 meters below sea level. Source: spacegizmo.livingdazed.com.

Mining for gold goes back centuries; evidence for this may be found in Egyptian hieroglyphs from as early as 2600 BC. It is said that gold helped finance the growth of the Roman Empire. The European exploration of the Americas was driven by reports of gold ornaments displayed in great profusion by the Native American peoples.

Closer home, Indians are known for their obsessive and compulsive fascination for gold. India is the largest importer and largest consumer of the yellow metal as Indians buy about 25 percent of the world's gold. In 2008, India imported around 400 tons of it. About 80 percent of the world’s extracted gold is fashioned as jewelry.

The environmental cost

However, most of us don't know or don't think about the environmental cost of the metal. For instance, extracting enough gold to forge a solitary, no-frills wedding band ultimately translates into roughly 20-30 tons of waste (estimates vary). At some mines in Nevada (USA), 100 tons or more of earth have been excavated for a single ounce (about 28 grams) of gold.

The waste is of two forms: redundant rock, which is typically piled as flat heaps in locations near the mining site and the effluent or tailings which are a result of chemical processing of the mined ore.

Sulphides in the redundant rock react with oxygen, making sulphuric acid which frees heavy metals like cyanide, cadmium, lead and mercury harmful to people even at miniscule concentrations (cyanide and mercury are used to separate gold from the rock.) The tailings component is typically a thick slurry laced with cyanide, aluminum, copper, lead, and mercury; enough to decimate fish populations of water environments it is disposed of into.

Disposal of wet tailings into water bodies has been effectively banned in developed countries but it continues to be practiced in most (if not all) developing nations. There is also a very real danger of surface water (i.e. lakes, streams, etc.) and groundwater table contamination on account of these heavy metals.

For example, Peruvian environmentalists say mercury released at La Rinconada (a city in the Peruvian Andes located near a gold mine) and the nearby mining town of Ananea has contaminated rivers and lakes more than 100 miles away. Sometime 2000, in Romania, gold mine waste spilled into a tributary of the Danube River killing more than a thousand tons of fish and giving rise to a plume of cyanide which ultimately travelled 2,500 kms to the Black Sea.

In fact, gold mining generates more waste per ounce than any other metal and the effects are startling. Mining for gold has left huge gouges on the face of the earth, so massive that they can be seen from space (see image).

Health issues

In September 2000, Down To Earth quoted a study titled “Pollution due to mining waste at the Kolar Gold Fields” conducted by the Department of Geology, Bangalore University. Respiratory ailments, soil and water contamination, thick blankets of dust, withering of coconut trees and changes in land pattern use are some of the common features of the urban area around Kolar Gold Fields in Karnataka. At least 13 major residue dumps accumulating about 60 million tons of mine waste occupy 15 per cent of the total land in the township near the gold fields. Many areas are reported to have become infertile because of soil contamination. They contain a percentage of heavy metals enough to retard plant growth.

Similarly, according to another report in 2008, nearly seven years after the closure of these mines, the people of this region continue to face serious environmental and health problems, particularly in July and August, due to the Aashadha winds that carry with them cyanide particles from the dust piles in the abandoned mines. When the mines were operational, a layer of red soil used to be put over these dust piles before the onset of Aashadha to prevent the cyanide particles from being carried away by the heavy winds. Now that the mines have been closed, the mitigative measures have ceased as well.

The social cost

There are reports of entire families on Ghana's ancient Gold Coast carry on their own hunt for gold. Dubbed by the large miners as “illegal miners” and the United Nations (specifically, United Nations Industrial Development Organization or UNIDO) as “artisanal” or “small-scale miners,” these people from socially and economically marginalized communities turn to mining to escape acute poverty, unemployment, and landlessness. In some cases, their homes and farms may be ‘acquired’ for large-scale gold mining.

While compensation is promised to them, it may take a year or two to kick in. Till then, forced to eke out a bare livelihood mostly in a kind of lottery system, they resort to crude methods to separate any flecks of gold that may be there in the discarded waste rock using mercury. In the process, destroy themselves slowly as well as their environment. The shanty towns which inevitably come up around the large-scale mining sites only serve to add to the problem. Given their illegal and therefore unrecognized nature, they lack basic amenities like garbage disposal and water supply and sanitation, becoming another unsightly blot on the landscape.

Habitat loss

According to the World Gold Council, while estimates of numbers engaged in artisanal mining vary widely, they range between 13 and 20 million men, women and children from over 50 developing countries. Indeed, it is believed that as much as a quarter of the world’s gold is supplied by artisanal miners. Their efforts to earn themselves a daily wage have resulted in huge (and overlooked) habitat loss and destruction.

For example, huge patches of land (some reportedly measuring 50 square kilometers) -- once home to lush trees in the island of Borneo in Indonesia -- are being swiftly rendered treeless and lifeless pits of waste. Incidentally, the island is highly famed for its rich biodiversity. Combined with heavy pressures from the logging lobby and need for cheap power through hydroelectricity and relentless mining activity, it is hard to imagine if Borneo will manage to retain its crown.

Consider another example. In 2007, Newmont Mining Corporation decided to foray into gold mining in Indonesia. The site is incidentally located in the rainforest, home to more than a thousand tribes of native Indian peoples and endemic wildlife species. Backed by the World Bank, Newmont compensated the farmers who were evicted from their land. It offered training for new jobs, like growing edible snails and making soap. It built new concrete and tin-roofed houses to replace homes made of mud. In 2007, Newmont paid close to $390 million in royalties and taxes and spent a reported $600 million in minimizing environmental damage. Till 2007, it had created 8,000 jobs for Indonesians.

In spite of all these “environmental and social mitigation efforts”, there continues to be widespread opposition in Indonesia to the company and its mining activities. A commonly asked question is, “What will be left of our environment when the mine is finished?”

In March 2009, Newmont released the results of an independent, 18-month international review of the company's ability to manage relationships with local communities. While the study deemed Newmont's current standards and policies to be "generally very good", it also noted (perhaps somewhat euphemistically) that "it is apparent there are significant gaps between the language of Newmont's standards and practices at the mine sites".

The study was generated by a 2007 resolution approved by nearly 92 percent of Newmont's shareholders to initiate a review of the company's policies and practices related to community opposition to its operations. The shareholder resolution was filed by Christian Brothers Investment Services and members of the Interfaith Center on Corporate Responsibility.

Mercury dumping ground

By the 20th century, though the big players in gold mining replaced mercury with cyanide, small-scale miners continued using it since it is faster and cheaper than the conventional panning. Small-scale gold mining is the second-worst source of mercury pollution in the world, after the burning of fossil fuels. According to a 2006 United Nations report, miners in Indonesia, the Philippines, Colombia, India, Tanzania, and Brazil are found to have mercury levels up to 50 times above the World Health Organization limits. United Nations observes that symptoms such as reduced motor skills, fatigue and weight loss are routine at mining sites. The European Union has agreed to ban mercury exports from 2011.

In developed countries, use of mercury in various products is either banned or regulated. No concrete initiative has however been taken by the Government of India to address the issue. Mercury and its various compounds are actually “free” for import to our country. While the conditions of its import are listed under the Hazardous Waste (Management and Handling) Rules -- against a license and only for the purpose of processing and reuse – it is in effect a green signal for multinational industries to India as one of the dumping grounds for cheap and environmentally destructive mercury. Under such a scenario, the government’s clamping down on mercury use in small-scale mining would not appear on the radar.

India’s quest to get intense

Why should these facts about gold mining bother us? After all, we just import the metal; we do not mine it here to the extent other countries do (the domestic production of gold is only about two tons per annum compared to Australia’s annual production of about 280 tons). That’s about to change though. New Delhi has big plans to fuel growth in the mining sector and is looking to open investment in gold mining in the country – and in a big way.

However, India’s environmental track record in mining has been anything but stellar. And this is something that requires close attention in light of the planned increased forays into gold mining. Even with the comparatively minuscule amounts of gold mining done so far, we have tripped up on environmental considerations.

Geologically, India’s terrain (Karnataka and Andhra Pradesh in particular) is very similar to those in other parts of the world where there have been huge gold finds. India is estimated to have 20,000 tons of gold and diamond reserves spread over several states. The estimated gold ore reserves in Andhra Pradesh alone are pegged at about 6.8 million tons.

Spiraling prices of this often volatile commodity (235 percent in the past eight years and still rising) and improved extraction technologies have suddenly turned even previously uneconomical sites viable into opportunities for gold mining. With the current market price for gold hovering over Rs 18,000-18,500 per 10 gram, the break-even point for a production rate of two tons of gold per annum for an open cast mine is Rs 8,000 per 10 gram and Rs 14,000 for underground mining. Many Indian and international mining companies are jumping into the fray. State governments could reportedly earn royalties of 20 percent (perhaps more) from gold mining.