Illegal Gold Mining in Peru

May 13, 2020

Gold is a highly valorized commodity in our society. You can see it in advertisements, entertainment and any retail store. Gold has long stood for wealth, power, and luxury, however, the process of extracting gold is not as glamorous. Illegal mining is the extraction of minerals or materials from the Earth without state permission. State permission often requires mining licenses and mineral transportation permits that seek to make the extraction processes safer. Illegal mining can come in the form of logging, wildlife tracking, and gold mining and it is prohibited because of the potentially hazardous effects extraction of resources can have on the environment and human health (USAID 2020). Illegal gold mining is a common practice in rural areas in Latin America. where environmental regulations and protection of sacred lands are hard to enforce. This practice is particularly common in areas surrounding the Amazon rainforest. “The illegal extraction of gold involves destructive processes that devastate the Amazonian communities, their forests, and their ecosystems” (USAID 2020). Illegal gold mining is particularly prevalent in areas like La Pampa in the Madre de Dios region of Peru, where gold is abundant, and regulation is difficult to enforce. In the past decade, gold mining in Peru has increased, as has the price of gold and the national economy of Peru. Peru is currently the sixth-largest gold producer in the world, and the number one gold producer in Latin America (USGS, 2018). In response to illegal mining practices, the governments of Peru and the U.S. have sought to take action to protect Peru’s ecosystems and the health of indigenous communities.

Gold mining can take various forms. In one form, gold mining occurs on small floats where miners use suction devices to obtain sediment from the floor of the rivers. The miners then use a series of strainers to separate the small gold specks. Gold mining on floats is particularly disruptive to the river floors where habitats are destroyed. Gold mining can also take place in forests where miners cut down trees and burn the area in order to access the soil underneath.The miners use "hydraulic hoses then spray water onto the remaining soil where it is loosened, removed and then placed onto sieves and mats that capture the fine sediment and gold" (Amazon Aid 2020). In both cases, the miners then insert the smaller sediment into a barrel with water and add mercury. “The mercury acts like a magnet to the gold, drawing the flecks of gold from the sediment to bind with the mercury, to become a small silvery-gold clump” (Amazon Aid 2020). After the gold has been collected, the mercury water is often dumped back into the river and is now ethylated mercury, which can be consumed by fish. The miners also often burn the mercury off of the gold clump, which can be very toxic if inhaled by the miners. Governments and organizations have tried to support the substitution of mercury in the process including other methods like panning, sluicing, and shaking tables, however none have gained traction against mercury, as these solutions are not entirely accessible in these communities. The illegal gold mining process is very dangerous and is growing due to the international increase in the price of gold. 

According to the Amazon Conservation Association, approximately 30,000 miners operate without mining permits or legal licenses in the Madre de Dios region of Peru (ACA 2013). This substantial amount of new miners is in response to the international price of gold, increasing by 360% from 2000-2010 (ACA 2013). The increase in the value of gold has created a vast amount of small scale gold mining operations (ASGM). According to the Guardian, there are approximately 2,312 ASGM mining sites in 245 areas across six Amazon countries (Phillips 2018).  Small scale gold mining operations are a type of gold mining managed by individuals, generally local miners, or small enterprises that have limited economic resources and capital investment. These operations are typically located in rural areas of the Amazon basin that are not regulated or monitored by the government. “The mining technologies used are oftentimes antiquated, inefficient, and dangerous, and in most cases use mercury in the process with no safety controls or regulations” (Amazon Aid 2020). The environmental impacts of ASGM are extremely harmful to human health and the environment. ASGM is often conducted by non-natives to the area that seek the economic gain of gold mining and indigenous populations that are driven by poverty. The illegality of the practice puts the indigenous population at an even higher risk, as organized crime, violence, money laundering, human trafficking, and child slavery are prevalent in communities where ASGM takes place (Amazon Aid 2020). 

Many of the indigenous populations partaking in illegal small scale gold mining operations say that they have been forced into it, as there are no other options, and the practice has taken over the region where they live. Illegal artisanal mining often takes place on protected indigenous reserves, even though it is illegal to mine on protected indigenous lands in many Amazonian countries. ASGM operations pose an obvious environmental and public health risk for these indigenous communities, but it also creates a negative social change due to the illegal practices that follow ASGM and exploit surrounding communities. Illegal activities, including child labor, are common in ASGM, where children miss out on education opportunities in order to work in gold mining. Other illegal practices including human trafficking, child sex trafficking, and narcotrafficking have followed. As an illegal practice, ASGM areas are particularly vulnerable to the presence and control of armed groups that may “use profits from gold mining to fund their operations - which may involve other forms of trafficking such as sex trafficking and child soldiers” (Verité 2020). According to Reuters, in the Madre de Dios region there were 79 cases of adult and child trafficking reported from 2014 to 2016; however it is almost impossible to know the true scale of trafficking in the region (Corpi 2018). In 2017, 305 child trafficking victims were rescued by Peruvian police in mining operations (Corpi 2018). Human rights groups have called on governments to tighten down on illegal mining practices and the illegal activities that have emerged because of it.

In addition to the social damage ASGM is producing in indigenous communities, small scale gold mining is also producing catastrophic environmental impacts. “Illegal gold mining has destroyed nearly 960 sq km of rainforest in Madre de Dios since 1985, more than two-thirds of it between 2009 and 2017” (Collyns 2019).  Gold mining has various effects on the environment, including a large amount of deforestation in order to create room for mining reserves. The loss of trees and original habitats has contributed to the disappearance of animals and organisms and has also had a tremendous impact on the soil. “Whilst the environmental footprint of these operations is generally small, the overall impacts are significant, and range from loss of biodiversity through to water quality issues” (Asby 2020). According to the Carnegie Amazon Mercury Ecosystem Project, gold mining has destroyed 50,000 hectares in the Madre de Dios region in Peru, one of the most biologically diverse regions on Earth. Environmental activists have been particularly critical of the introduction of mercury into bodies of water as it has long- standing effects on the environment and the health of organisms that consume it. 

During the extraction of gold mining, miners use mercury in barrels for the gold to conglomerate. According to The Guardian, more than 30 tons of mercury is discarded into the rivers every year (Collyns 2013). The mercury is particularly toxic and can have a large range of health effects on the miners. “Indigenous children in Peru's southeastern Amazon, an area where tens of thousands of illegal gold miners operate, have unsafe mercury concentrations over three times the level of their non-native counterparts, a study has found” (Collyns 2013). The high mercury levels in the rivers and lakes also affects the fish in the water, which then contributes to the high amount of mercury in indigenous communities living near the illegal mining reserves. “The mercury dumped by miners settles in the sediments at the bottom of the rivers and gets converted into an organic form, Methylmercury, which is absorbed by biological organisms and concentrated up the food chain” (Collyns 2013). Ingestion of Methylmercury can be particularly dangerous to pregnant women, as it can have effects on the baby’s brain. Mercury can also affect the heart and circulatory system and is possibly carcinogenic (Green Facts). Due to the health, environmental, and social effects of ASGM, Amazonian governments have begun to try to decrease the amount of illegal mining near the Amazon. 

Peru’s government has made it a recent priority to tackle illegal gold mining operations by establishing a state of emergency. In February of 2019, Peru launched Operation Mercurio with four priorities; the eviction of illegal mining operations, the formalization of legal mining in limited areas with cleaner practices, addressing social problems like human trafficking and child labor, and the investment and development in sustainable alternative livelihoods (Leas 2019). “By air, land and river, hundreds of army commandos and more than 1,200 police officers swooped on La Pampa” (Collyns 2019). The government of Peru has said that they have expelled 6,000 miners, captured criminals, and rescued 50 victims of trafficking (Collyns 2019). Three military bases have been established in the town with the Amazon Protection Force monitoring mining actions. The Operation seeks to move miners into the formal economy by moving them west of La Pampa, in the Madre de Dios region, in order to support legal mining and eradicate the illegal activities associated with illegal mining. The government has invested in sustainable development alternatives, including agriculture and fish farming. According to Monitoring of the Andean Amazon Project, there has been a significant reduction in gold mining deforestation in La Pampa in 2019 (MAAP 2019). However, fear remains that illegal gold mining will return to La Pampa when the regulation of the town begins to decrease.

As the governments have increased measures and enforcement in an effort to eradicate illegal gold mining in Peru, gold miners have relocated further into the Amazon forest contaminating new areas. As the governments continue their attempts to suppress new illegal mining operations the question: “Where is all this gold going?” arises. Overtime, some miners have ousted their buyers including Metalor, a Swiss refinery, Kaloti Metals, NTR Metals, and Republic Metals Corporation, US-based refineries. These refineries have been accused of importing “dirty gold”. Dirty gold is gold that has been extracted illegally and is potentially dangerous to the lives of miners. Dirty gold is a stigma that has forced companies to begin thinking about the social responsibility they have when buying gold. US companies like NTR Metals have actively supported illegal mining activities that are so detrimental to the health and wellbeing of indigenous communities and the environment. According to Leonardo Goi, NTR Metals began buying gold from Peru in 2012. “In 2013, NTR had declared an estimated $980 million in gold imports from the 2012 NTR had only imported $73 million, and gold imports from Peru were close to zero the year before” (Goi 2017). The increase in imports of dirty gold from NTR Metals indicates the social irresponsibility of US companies. The US government’s support of Peru to help eradicate these mining operations should also focus on the demand of gold, and holding these companies that are supporting the illegal production of gold responsible. 

The issue with illegal small scale gold mining and dirty gold is that when buying gold, it is difficult for buyers to determine whether that gold is dirty or not. It is the responsibility of the companies and refineries to investigate the source of their gold so that they are not supporting the tremendous negative environmental, public health, and social effects that ASGM contributes to. Gold is everywhere in our society, and the question is, does it really need to be?



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About Author(s)

mia.bristol's picture
Mia Bristol
Mia Bristol is a fourth year undergraduate student at the University of Pittsburgh pursing a double major in Political Science and Spanish with a Certificate in Latin American Studies. During summer 2019, Mia completed research on the use and accessibility of contraception in the University setting in Manizales, Colombia through the Seminar and Field Trip by the Center for Latin American Studies. Mia intends to graduate Spring 2020 and pursue a career in foreign affairs. This is her first year as an intern for Panoramas.