The Current

Gold: Why a mining company is suing El Salvador

The government of El Salvador worries about its damaged environment and believes the gold in its hills should remain in the hills. A mining company believes the gold belongs to them and is suing El Salvador to get it out. It raises vexing questions about exactly who owns a nation's natural resources....
The government of El Salvador worries about its damaged environment and believes the gold in its hills should remain in the hills. A mining company believes the gold belongs to them and is suing El Salvador to get it out. It raises vexing questions about exactly who owns a nation's natural resources.
Last week demonstrators opposed to mining gathered outside the World Bank office in San Salvador. They want the World Bank to review regulations that allow companies to sue countries for withholding mining permits. El Salvador is being sued by Pacific Rim, a Canadian mining company that had conducted exploration for a gold mine in the country's north. In 2007, the government of El Salvador announced a moratorium on mining. Pacific Rim was denied permits and in 2009, it took El Salvador to court demanding 300 million dollars in compensation. Pacific Rim has since been bought out by OceanaGold, an Australian-based corporation, but the lawsuit remains active. 

  • Luis Parada is an attorney with the law firm Foley Hoag. He is representing El Salvador in its dispute with Pacific Rim which is now owned by OceanaGold. He was in Washington.

  • Robert Wisner has represented a number of mining companies in international disputes like the one in El Salvador. He is the co-chair of international arbitration at McMillan law firm. He is a former member of the Corporate and Social Responsibility Committee at the Prospectors and Developers Association of Canada. He was in Toronto.
As of March last year there were 60 cases pending before the International Center for Settlement of Investment Disputes related to oil, mining, or gas. In 2000, there were only three pending cases. 

Here is OceanaGold's full statement, of which we voiced a segment:

15 April 2014

OceanaGold Corporation (the "Company") was unable to participate on the CBC Radio program "the Current" however, it wishes to provide the following statement:
Since acquiring Pacific Rim Mining Corp. late in November 2013, OceanaGold has stated that while it has maintained the arbitration pending before the International Centre for Settlement of Investment  Disputes ("ICSID") in order to protect its legal rights, the Company's strong preference is to engage in a constructive dialogue with the Government of El Salvador to seek a negotiated outcome to the permitting impasse.
OceanaGold has a proven track record of success developing and operating mines over the past 23  years in New Zealand which has stringent environmental and community engagement standards. In  2013, we successfully commissioned the Didipio Mine in the Philippines. This was a major milestone and  would not have been possible had the project not received the strong endorsement from local and  surrounding communities as well as our many stakeholder groups throughout the Philippines including  government regulators.
We are a values driven organization that operates to the highest of standards and have developed a solid reputation as a responsible corporate member of our communities. We are focused on the health and safety of our employees and the residents of our communities. We have an unwavering commitment to the environment and place great importance on effectively managing our operational footprint and water management programs. We also partner with likeminded organisations such as the International River Foundation, to promote and educate members of our communities on effective river management.
OceanaGold firmly believes that the El Dorado Project has the potential to be an economic engine for El Salvador much like how the Didipio Mine has been for northern Luzon in the Philippines. The project represents a high quality gold resource with an expected low environmental footprint utilising modern underground mining methods.
It is important to note that the El Dorado Project already has very strong local community support. We  are committed to building on this support and working closely with our new stakeholders IN EL  SALVADOR to establish a roadmap to unlock the opportunity that exists for the Salvadoran people.
Cautionary Statement
Statements in this release may be forward-looking statements or forward-looking information within the  meaning of applicable securities laws. Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases such as "expects" or "does not expect", "is expected", "anticipates" or "does not anticipate", "plans", "estimates" or "intends", or stating that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved) are not statements of historical fact and may be forward-looking statements. Forward-looking statements such as production forecasts are subject to a variety of risks and uncertainties which could cause actual events or results to differ materially from those reflected in the forward-looking statements. They include, among others, the accuracy of mineral reserve and resource estimates and related assumptions, inherent operating risks and those risk factors identified in the Company's most recent Annual Information Form prepared and filed with securities regulators which is available on SEDAR at under the Company's name. There are no assurances the Company can fulfil such forward-looking statements and, subject to applicable securities laws, the Company undertakes no  obligation to update such statements. Such forward-looking statements are only predictions based on
current information available to management as of the date that such predictions are made; actual
events or results may differ materially as a result of risks facing the Company, some of which are beyond the Company's control. Accordingly, readers should not place undue reliance on forward-looking statements. The information contained in this release is not investment or financial product advice.

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This segment was produced by The Current's Lara O'Brien and Sujata Berry.


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