[R-G] Vancouver's Corriente Resources is in deep in Ecuador

[Anthony Fenton]

November 10, 2008
http://www.dominionpaper.ca/articles/2054

How Good is Canada’s Word?
Vancouver's Corriente Resources is in deep in Ecuador

by Jennifer Moore

The Dominion - http://www.dominionpaper.ca

Members of the indigenous Shuar Nation and Mestizo farmers march  
against proposed mining developments. Canadian mining companies have  
been conducting large amounts of mineral exploration against the will  
of local residents in various regions of Ecuador. Photo: Jennifer Moore

QUITO, ECUADOR–“Companies should respect society and the environment,”  
said former Canadian International Trade Minister Michael Fortier  
during a recent visit to Ecuador. “And if they don’t, we will not  
approve of their continued operations.”

The Ecuadorian capital was the final stop on Fortier’s Latin American  
tour in mid-August, which also included Mexico and Panama.

Canadian capital makes up over 90 per cent of the money being invested  
in Ecuador’s nascent metal mining sector. The industry has been in  
development for about 15 years but has yet to see any large-scale  
mineral projects go into production despite dozens planned.

Widespread local opposition during a period of policy change has led  
companies to lobby hard for political support from the Canadian  
government.

And since the Ecuadorian National Constituent Assembly passed a decree  
on April 18 toughening up mining regulations, Canadian government  
officials have stepped up their support for the over 25 Canadian- 
financed companies exploring in Ecuador.

The decree ordered most mineral concessions revoked for various  
reasons, including proximity to headwaters, overlap with protected  
natural areas, concessions obtained through government officials with  
insider knowledge and failure to consult with local communities.

Both Fortier and Canadian ambassador to Ecuador Christian Lapointe  
have expressed concern to the Ecuadorian government over the decision.
The Intag region, in northwestern Ecuador, is one of many areas in the  
country threatened by proposed mining concessions. Photo: Dawn Paley

But it is likely that a combination of political pressure from Canada  
and a lack of political will from President Rafael Correa’s government  
(which favours mining to bolster state revenue) will leave most  
criteria for revoking mineral concessions unapplied. Large-scale  
metallic mining activities, however, have been suspended until a new  
mining law is approved.

The law, anticipated to replace the government decree, has had  
extensive industry input and will likely be approved by an interim  
congress now that Ecuador's new Constitution has been approved by a  
referendum.

Despite these developments, Canada is keeping the pressure on. Before  
Canadian elections were called on September 7, Fortier announced that  
Prime Minister Stephen Harper would travel to Ecuador to meet with  
Correa. It would be surprising if mining is not on his agenda.

Collective rights disregarded

Despite Fortier’s assurances, Canada’s help for mining companies does  
not ensure respect for communities acting in defence of their rights  
and their environment.

Shortly after President Correa’s January 2007 inauguration, a  
nationwide movement against mining began to coalesce.

The rural, environmental, and indigenous organizations in the  
coalition have emphasized the lack of respect for communities' right  
to consultation guaranteed in the current constitution. Many of these  
groups have been lobbying for a provision that would require local  
consent for mining activities to be included in the new constitution,  
although this has ultimately been opposed by the government.

Alberto Acosta, the former Minister of Energy and Mines and past  
President of the National Constituent Assembly, said that in lieu of  
community consultation, "Companies have specialized in how to divide  
communities," leading to "near civil war" in parts of the country.

Familiar strategies to divide communities include fabricating charges  
against mining opponents, allegations often made by third parties with  
a known connection to mining companies. Threats and the use of force  
have also been employed. And corporate-community relations programs  
that are often aimed at particular individuals or groups within a  
community fostering or aggravating strong differences over mining are  
widely seen as buying the 'social license' that companies need.

The April mining decree included the failure to consult with  
communities as one of the criteria for revoking mineral concessions.  
However, protecting companies appears to be Canada’s priority.

Ian Harris, Senior VP of EcuaCorriente, a subsidiary of Vancouver- 
based Corriente Resources Inc., recently wrote that, “The Canadian  
Embassy in Ecuador has worked tirelessly to affect change in the  
mining policy – including facilitating high-level meetings between  
Canadian mining companies and President Rafael Correa.”

Another industry leader commented that the embassy has reminded the  
President and his ministers to respect Canada’s Foreign Investment  
Promotion and Protection Agreement (FIPA) with Ecuador.

Amongst other things, the FIPA says that Canadian investments cannot  
be expropriated “without prompt and adequate compensation.”

Compensation is not ensured in the mining decree, which orders  
revocation of mineral concessions without compensation.

Under the investment agreement, companies also have “access to binding  
international arbitration for disputes arising from a breach of the  
treaty,” notes Michael O’Shaughnessy from the Department of Foreign  
Affairs.

So far, the partial application of the mining decree has meant that  
the companies have apparently not felt the need to seek recourse under  
the treaty. However, the question remains as to whether the treaty is  
also playing a role in limiting the application of the decree.

Indiscriminate support

Further challenging Fortier’s claim is Canadian government support for  
companies with a questionable human rights record.

In one strange twist of events, the Ottawa-based research and advocacy  
organization MiningWatch Canada received “malicious” letters from two  
indigenous representatives, including Shuar leader Ruben Naichap.

The letter included “bizarre accusations of genocide and that we were  
somehow paying people to blockade the road,” says Communications and  
Outreach Coordinator Jamie Kneen.

What MiningWatch had done was post information on its website about  
heavy military repression against anti-mining resistance in the area  
pertaining to Corriente Resources’ Mirador Project.

A report submitted by several Quito-based human rights organizations  
to the Inter American Commission of Human Rights describes human  
rights violations resulting from this incident.

It was later verified that the correspondence from Naichap was written  
on a computer owned by Corriente Resources.

Corriente is one of a handful of companies banking on an extensive  
gold and copper mining district in Ecuador’s Southern Amazon. Their  
mineral concessions include a 20km by 80km band across five counties  
in two provinces.

Company representatives have also enjoyed regular discussions with the  
Ministry of Mines and Petroleum, have had input into the country's  
mining law, and have attended a meeting with top Ecuadorian officials  
along with seven other companies that was facilitated by the Canadian  
embassy shortly after the mining decree was announced.

MiningWatch, on the other hand, is still waiting for a response to a  
letter to the embassy sent over a year ago about why the Canadian  
government supports Corriente.

Kneen wants to know why “one of the companies at the centre of one of  
the hottest conflicts where people have been shot at, tear gassed, a  
congressman has been taken hostage for about three days... and that  
has had a stop work order, [is] being treated as a respectable  
corporate citizen.”

A Fair Deal?

Despite this conflict – or perhaps because of it – Corriente has also  
run the highest profile pro-mining publicity campaign of any company  
in Ecuador.

Using the slogan “A Fair Deal,” the campaign focuses on the promise of  
jobs and development. But its questionable choice of local  
collaborators is suspected to have undermined indigenous organizations  
and aggravated tensions in the Amazon region.

Don Clarke, vice president of sustainable development for  
Ecuacorriente, promotes himself as a specialist in facilitating  
company relations with indigenous communities.

Writing for the Canadian Foundation for the Americas (FOCAL), Clarke  
says, “Companies that lack the corporate capacity to understand  
indigenous issues quickly encounter issues that can dramatically  
impact their bottom line and render the business environment hostile.”

This may be true, given that areas desired by extractive industry  
increasingly include indigenous territories.

Clarke’s approach in Ecuador has been challenged by indigenous  
organizations, especially given the support he has provided to such  
controversial representatives as Ruben Naichap, who signed one of the  
letters that MiningWatch received last year.

As early as 1998, two regional Shuar federations from the Southern  
Amazon publicly denounced Naichap for “conflictual, divisionist and  
individualistic behaviour that has caused serious problems within  
their communities.”

In 2007, a Shuar Association that groups together indigenous  
communities near one of Corriente’s main projects also expelled  
Naichap for aggression and corruption.

Naichap has worked closely with Don Clarke over the last year and a  
half, becoming a sort of national and international emissary on behalf  
of Corriente and the large scale mining industry in general.

Clarke indicates that Corriente has a “Memorandum of Understanding”  
with Ruben Naichap’s Shuar Federation, one of two in the Province of  
Zamora Chinchipe.

The agreement includes regular financial support that, Clarke says, he  
believes the "communities manage appropriately.” In addition, it  
includes stipulations about labour and services and is viewed as a  
step toward an eventual Impact Benefit Agreement.

María Belen Páez, from Quito-based Pachamama Foundation, says that  
money provided by companies in such cases “provokes tension,  
aggravates conflicts and without doubt arrives at extremes of violence.”

Angel Awak is President of the nationally-recognized Shuar Federation  
of Zamora Chinchipe, which works with Amazonian and nationwide  
indigenous organizations that are highly critical of mining.

Awak attributes the 'grave conflict' that they are experiencing to  
mining and other extractive industries.

He says money causes problems, particularly at the level of the  
community where “it is used to buy people’s conscience and begins to  
divide families.” He is also worried about a group that is said to be  
forming to confront mining opponents. Naichap is believed to be  
involved with this new organization.

Clarke responds by saying, “Our company has always been open to work  
with anyone that wants to be worked with... It’s not the role of the  
company to decide who’s legitimate or not, our role is to work with  
stakeholders.”

But given his stated expertise in community relations, his easy  
dismissal of the tension his company generates begs the question about  
how “corporate capacity to understand indigenous issues” is being  
used. And whether “a hostile environment” might actually work in the  
company’s interest to mask and weaken opposition to their particular  
projects.

A little respect

“To enter, one should have permission,” considers Awak, “Just like  
going into someone’s house.”

“This small group of people [referring to Naichap] is speaking out  
because they have the resources to do so. For those of us who are on  
the defense, we just don’t have resources for the world to hear us" he  
continued, adding, "Our people need quality education and healthcare,  
but without destruction."

With state forces aligned on the side of industry, and coalitions of  
indigenous organizations and environmental groups fighting to prevent  
mining from taking place without local consent, the struggle in  
Ecuador is far from over. As a result of President Correa’s support  
for the mining industry, however, the fight might move from national  
politics to tough battles at the local level.

MiningWatch Canada's Kneen suggests that Fortier needs to keep his  
word. “We’re not saying that Canadian businesses don’t deserve some  
level of support,” he explained.

But, he said, “Historically, Canada’s objectives internationally have  
included democratic development and protection of human rights... If  
those are still being respected we need to see how these decisions are  
being made.”

Jennifer Moore is an independent print and broadcast journalist  
currently based in Ecuador.