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November 11th, 2008
THE DIG
Wide Angle: Peruvian Water Supply in Peril

As hurricane season winds down in the U.S., the rainy season in Peru is just picking up. In addition to the usual fears of floods and landslides, residents in and around the capital of Lima are now concerned that heavy rains could weaken man-made receptacles of mining waste, called “tailing ponds” and lead to the contamination of their water supply. In May, the Canadian owner of the mine, Gold Hawk Resources, suspended operations as a preventative measure. The company, looking for profits from gold, silver, zinc and lead deposits, was hit with plummeting stock prices and laid off local workers.

This didn’t solve the problem of existing waste however, and in July the Peruvian government issued a state of emergency in the area, ordering the company to relocate the processing plant and tailing ponds. Gold Hawk now says the new facilities are ready for business, but is still waiting for a permit from the government before it can proceed. Storm clouds rumble in over the Andes and while the fate of the mine hangs in the balance, both shareholders and citizens of Lima are nervous about the outcome.

A variation on a theme, this scenario has been playing out from Congo to the Philippines: mining operations from the developed world move into ore-rich, but impoverished areas of developing countries. The issue is never as cut-and-dry as many environmentalists or corporate quarterly reports would have it seem. According to the UNDP, over half of Peru’s population lives under the national poverty line. When an international mining company sets up shop in such an area, they know they’re sure to be monitored by watchdog groups and accordingly draw up community relations plans. Promises of medical centers and literacy programs, as well as steady wages are no doubt attractive to residents whose local infrastructure may be lacking.

But when approving large-scale mining projects, nations must weigh jobs and community benefits against the potentially far-reaching costs of clean-up, should an environmental disaster occur. In 2000, a contractor working for Newmont Mining Corporation accidentally spilled 330 pounds of mercury near the small Peruvian town of Choropampa. The company’s resulting multi-million dollar mitigation efforts included health care for villagers who reported symptoms of mercury poisoning. The controversy over that mining operation leaves many Peruvians skeptical of new mining endeavors.

In the film Gold Futures, WIDE ANGLE visits a mining village in Romania where mineral wealth and badly-needed jobs compete with time-honored rural traditions and concerns about poisoning the environment.

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