Mining Firms Seek Argentina’s ‘White Gold,’ But Local Approval Proves More Elusive

JUJUY, ARGENTINA — Lithium lies deep below the thick, crusty plain known as the Salinas Grandes, but Walter Alancay mines its vast surface for the salt.

He swings a pickax into a small pool carved out of the salt plain and scoops the crystals out. That’s what he was doing in 2012 when large machines from a mining company rumbled onto the plain, he says.

“We saw all the action, how they mounted the machines that were doing the drilling,” he says.

Alancay approached the workers to find out what they were doing. They told him to ask their boss, whom Alancay couldn’t find. But to Alancay, the evidence was clear. He rushed to spread the word about what was going on.

Other local people found out about the mining activities in equally abrupt ways.

Verónica Chávez, who represents the Santuario de Tres Pozos community, says she took lodgers into her home but realized after they’d settled in that they worked for South American Salars S.A., a mining company that is a subsidiary of Australia-based Orocobre Ltd. She evicted them and rushed to the lake to see what damage had already taken place. Workers had drilled through the salt crust to extract samples to analyze conditions for potential lithium exploration.

“The earth was torn apart,” she recalls. “The salt lake is a sacred place for us, a part of our family. We can’t destroy it, we live it daily.”

Salinas Grandes, the salt flat that straddles the line dividing Salta and Jujuy provinces in Argentina’s northern tip, is among a handful of sites that are in high demand among mining companies seeking not only lithium — a key ingredient in high-tech batteries that power cellphones, electric cars and other products — but also boron, potash and other minerals. Multiple international mining companies have sought concessions here to explore for and mine lithium, in a bid to cash in on what experts say could be one of the most lithium-rich places on earth. Some companies have already begun lithium exploration in the Salinas Grandes, while others have extracted the mineral from other salt flats in the region.

In some cases, communities have signed agreements with companies that seek lithium only to discover that those agreements left them with barren land and little money — a common experience for rural and indigenous groups that live where natural resources are abundant.

But that’s not the story for 33 indigenous communities in the Salinas Grandes area, including those where Alancay and Chávez live. Their opposition to one mining company in 2012 ultimately led to the creation in late 2015 of a document called the Kachi Yupi, which requires that companies proposing to operate in the area consult with the indigenous groups and follow a protocol that is respectful of their culture.

Argentina has a law intended to secure the rights of indigenous groups over the land where they have traditionally lived, but that law is not effective because it hasn’t been fully implemented, according to the International Commission of Jurists, a human rights organization based in Geneva.

The Kachi Yupi agreement, community leaders say, specifies ways that outside entities such as mining companies must pursue local agreement for proposed projects. The 33 communities that are party to the Kachi Yupi are working with the Salta and Jujuy provincial governments to formalize the document, but its guidelines already have teeth. The federal Office of the Ombudsman formally recognized the document in May 2016 and recommended that local governments respect it. The 33 communities are negotiating with the Jujuy and Salta governments to formalize the process the document outlines.

Dajin Resources Corp., a Canada-based mining company, wants to explore the Salinas Grandes salt plain for lithium, but those plans are stalled, company leaders say, because of the Kachi Yupi guidelines.

Dajin’s activity on its 230,000-acre claim has not been rejected, but it won’t be approved until the company fully complies with the Kachi Yupi, says Natalia Silvina Sarapura, the minister of the Jujuy provincial government’s Ministry of Indigenous Communities.

That ministry, which was created in 2015, tossed out a previous agreement Dajin had signed with local communities and told the company to pursue its approval for mining exploration through the Kachi Yupi process.

Catherine Hickson, Dajin’s chief operating officer, says the company has done all that has been asked of it since 2007, when it first eyed the lithium potential in Salinas Grandes. She expressed frustration at the process.

“We’ve been waiting, and we continue to wait,” she says. “The Kachi Yupi has no consultative process. It’s a document that says, ‘You need to consult with us,’ but it doesn’t say how you do that. We’re waiting for some clarification on that.”

Fernando Muñoz Carmona, a geoscientist who acts as a local advisor for Dajin, says the Kachi Yupi communities must accept that the mining companies and the state will request modifications to the document.

“If a consultation protocol is able to be established, accepted and agreed upon by the three parties [including the] state, communities and companies, it will serve as a pilot test to get a provincial consultation procedure,” he says.

It will take communication between all the parties to reach a mutually agreeable solution, he says, adding that he’s optimistic that it can happen and that Kachi Yupi can become a reference point for all mining agreements in Argentina.

Despite Muñoz Carmona’s assertion that mining companies will weigh in on the Kachi Yupi, there is no indication that it will be amended. As far as local people are concerned, the document is final.

“Now that we have the Kachi Yupi, a written document, it’s easier for the government to respect us,” Chávez says.

Argentina’s ‘White Gold’
The Kachi Yupi was drawn up just as more mining companies began to turn their attention to northern Argentina’s lithium wealth. The country has among the largest lithium reserves in the world, ranking below only Chile and China. Australia and Chile are the top lithium producers, with Argentina a distant third, but the country’s fast-changing political landscape could open it up to a sharp increase in mining activity. President Mauricio Macri, who took office in late 2015, quickly lifted capital controls, a move that drew fresh interest from international mining companies.

Deloitte, a U.S.-based consulting firm, predicted in 2016 that Argentina is poised to be a global leader in production of lithium, sometimes known as “white gold.” Jujuy province, located at Argentina’s northernmost tip, is part of what mineral experts call the “lithium triangle,” an area comprising sections of Argentina, Bolivia and Chile that is thought to hold vast deposits of the mineral.

Details on specific mining projects in Argentina, including the number of companies seeking permission to explore for lithium, are difficult to confirm because provincial governments manage both granting concessions and supervising agreements. In Jujuy, the provincial mining department didn’t release cadastral records — the maps and associated information detailing mining concessions and activities — for a period of months while those records were being reviewed and reorganized. Those records were made available again in November. A map created by Global Press using those now-public cadastral records revealed that some of the mapped concessions do not specify the mining companies operating there.

(Click the menu in the top left of the map to see the different types of activity)

Officials in Jujuy’s mining department told Global Press that just two companies are actively mining for lithium right now. One is Sales de Jujuy, the Orocobre subsidiary which, along with the Toyota Tsusho Corporation of Japan, formally opened the Salar de Olaroz mine on the Olaroz-Cauchari salt plain in late 2014 and began producing the mineral in early 2015.

The other, Lithium Americas, operating locally as Minera Exar, has interests nearby. Both projects are listed as being run in partnership with Jujuy Energía y Minería Sociedad del Estado (JEMSE), the state-owned mining company.

Communities in those areas have complained about severe environmental impacts, including water shortages. Neither Lithium Americas nor Orocobre responded to requests for a comment for this story.

The communities that are party to the Kachi Yupi worry that Dajin’s proposed mining project would compromise their water sources too, as well as desecrate the salt lake.

Marcelo Sticco, a geologist who until 2013 served as the hydrology expert on lithium projects for Jujuy province’s ombudsman’s office, says the communities’ concerns are well-founded.

Lithium extraction requires drilling holes in the salt flats to extract salt water from the center and fresh water from the borders. These perforations would alter the water regimen in the area, increasing salinization of the watershed’s scarce fresh water, he says.

The communities have an economic and spiritual link to the Salinas Grandes, says Clemente Flores, who represents the 33 Kachi Yupi communities. They are the native people of this area and their ancestors have long cultivated the salt and utilized it for their survival.

‘Water is Life’
Mining companies have a history of not only damaging the environment, but also failing to make good on their promises to local communities, says Pía Marchegiani of Fundación Ambiente y Recursos Naturales, a nonprofit environmental organization, who supported the communities during their writing of the Kachi Yupi.

Often, companies promise good jobs for local people, but those jobs wind up being for tasks such as cooking and cleaning, Marchegiani says. And the companies approach communities one by one, which erodes the local social fabric.

Dajin’s Hickson argues that it doesn’t have to be that way. She points to the original agreement that her company signed with communities around Salinas Grandes, which would have allowed Dajin to begin lithium exploration.

“We were going to help them restore some buildings, they were going to be used to house people who were going to be working on the project,” Hickson says. “There was going to be money paid to the community on a monthly basis… they were satisfied.”

There were plans to take people from the Salinas Grandes communities to see the Lithium Americas mine in the Olaroz-Cauchari salt plain to show them that there was no reason to fear, she says. And when Dajin was told that it would have to pursue its permits via the Kachi Yupi process, the company complied.

“We said, ‘We don’t have a problem with this, but we need a time frame,’” Hickson says. “They were never able to provide us with a time frame.”

For many people in the Kachi Yupi communities, that time frame doesn’t include a date for when Dajin can begin its work.

“The rights and the future are non-negotiable,” says Felix Vediae, who represents Comunidad Originaria Aylls, one of the Kachi Yupi signers. “Water is life, and we want to leave something for our descendants.”

 

Lourdes Medrano, GPJ, translated this article from Spanish.