Canadian activists blast Infinito’s $1 billion arbitration plan

Six Canadian environmental and public policy organizations have demanded that Infinito Gold Ltd. end its decade-long harassment of the people and government of Costa Rica and withdraw a threat to bring the country into international arbitration.

The group is headed by an organization called Mining Watch, which is based in Ottawa, Ontario.

Said a release:

“Infinito Gold has tried to portray itself as the victim of a capricious court system. In reality, the Calgary-based company has tried to strong-arm Costa Rica’s judiciary into overturning two supreme court rulings (2010 and 2011) that upheld the country’s ban on open-pit mining. The courts told the Canadian company it could not develop the Crucitas mine, and told Infinito to pack up and go.”

Actually the 2010 ruling favored the mining company, which operates in Costa Rica as Industrias Infinito S.A.. The mine is the Crucitas in the northern part of the country.

In a summary posted to the Canadian firm’s Web site earlier this month John Morgan, Infinito company president, noted that his firm is facing two conflicting court rulings. The Sala IV constitutional court ruled April 16, 2010, that all legal objections raised against the project were without merit. But the lower Tribunal Contencioso Administrativo that November ordered that the concession be annulled, and this was upheld by the Sala I Nov. 30, 2011.

The environmental coalition directed its letter to Morgan, it said in a release. Industrias Infinito sought to extract some 800,000 ounces of gold over 15 years. Concerns for protected trees and birds derailed the plan.

“Instead of leaving, the company ratcheted-up a campaign of intimidation, attempting to censor a University of Costa Rica course focused on the mining project and launching defamation suits against two professors and three other Costa Ricans who have spoken out publicly about the potential impact that this mining activity could have on a fragile environment,” said the Mining Watch release.

Other organizations listed as signatories of the letter to Morgan are Common Frontiers, Sierra Club Canada, Comité pour les droits humains en Amérique latine, Council of Canadians,  The Blue Water Project, the Polaris Institute and the Public Service Alliance of Canada. The letter also sought to implicate former president Óscar Arias Sánchez:

“In 2012 the Canadian government was asked by Costa Rica to provide information about an alleged US$200,000 donation to then-President Oscar Arias’ Arias Foundation in 2008, coming from Canada, and made just days before Arias decreed that the Crucitas mine was to be considered ‘in the national interest.’ Canada’s Department of Justice responded to this request in early February of this year, but has refused to comment on the information provided. The Costa Rican government suddenly announced last week that the long-time head of the Arias Foundation had been named as its ambassador to Argentina.”

Prosecutors have been investigating Arias and a former environmental minister, but there have been no charges filed.

The company used the decree by Arias that the mine was in the public interest to start logging operations to clear a site for the open pit mine, but these were halted by the courts.

Meanwhile, at the urgings of President Laura Chinchilla, the legislature passed a ban on large-scale commercial mining.

The letter also took a slap at the Canadian Embassy here:

“The company’s behavior, and the public support it has enjoyed from the Canadian Embassy, has seriously damaged Canada’s reputation in Costa Rica, a country that is a favorite destination for Canadian eco-tourists.”

Infinito has not actually filed an action with the World Bank’s International Centre for Settlement of Investment Disputes.  It sought discussions with Costa Rican officials.

The company seems to have a good case in its demand for $1 billion.

The Canadian firm, which has spent 20 years trying to get the las Crucitas Project working has been hamstrung by the court actions. One decision ordered that the concession be revoked.

The Las Crucitas operation was to be an open pit mine in which the gold-bearing rock was carried to the surface, crushed and treated with chemicals to extract the valuable metal. That raised concerns on two fronts. First, the company had to cut protected almendro or mountain almond trees that the protected great green macaw favors.

Secondly, there was concern that the harsh chemicals might leach into the environment and perhaps into the nearby Río San Juan.

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