In the wake of taking control of Augusta Resource Corp. and its Rosemont Copper Company subsidiary, Toronto-based Hudbay Minerals is already looking to expand its planned industrial mining operations in the Santa Rita Mountains to other sites in Southern Arizona, Hudbay President and CEO David Garofalo told the Green Valley News & Sun editorial board this week.
“What attracts us to Arizona is it is an historic copper district, it’s copper country,” Garofalo said in a meeting Tuesday with the Green Valley News.
“Our geologists and geophysicists salivate over the potential within this district, and our objective, in addition to building Rosemont, is…to start to accumulate property positions, hopefully within spitting distance of the industrial complex we’ll build at Rosemont, so that we can continue to extend the life of that, and keep high-paying jobs for the foreseeable future,” Garofalo said.
Hudbay has a long history of establishing an industrial toehold in a region and then constructing numerous mines in the immediate area that often operate for decades. The company’s primary mining operations have been centered in the small town of Flin Flon, Manitoba, about 475 miles north-northeast of Winnipeg on the Saskatchewan-Manitoba border.
Hudbay operated an antiquated, highly-polluting copper smelter in Flin Flon for 80 years before closing it in 2010. Pollution from the smelter and other mining operations has contaminated the soil in the community, leading to a series of studies to test for lead and other metals in children.
Hudbay has also left behind a troubling legacy in the Fenix region of Guatemala where forced relocation of indigenous people near a nickel mine once owned by Hudbay has led to allegations of gang-rape, murder and shootings.
Three lawsuits are currently ongoing for the 2007 gang-rapes – allegedly committed by company security, the army and police – and for the 2009 murder of Q’eqchi’ man Adolfo Ich Chaman and shooting of German Chub – allegedly committed by company security – who survived but was left paralyzed.
Last year a landmark ruling by an Ontario court stated that the lawsuits can proceed to trial in Canada, given that the rapes were allegedly committed when Fenix was owned by Canadian firm Skye Resources and the murder and shooting after Skye had been acquired by Hudbay, The Guardian, a London-based newspaper reported on July 24.
Hudbay, according to The Guardian, says the allegations are “without merit”, calling the Q’eqchi’ people “illegal occupiers” and saying that the 2007 evictions were “implemented under court orders”, that the rape claims are not credible, and that, “based on internal investigations and eyewitness reports, CGN personnel were not involved with [Ich Chaman’s] death.”
Hudbay sold the Fenix mine to Solway in September 2011 after the lawsuits were filed – a move which MiningWatch Canada’s Jennifer Moore describes as Hudbay “bailing out”, The Guardian is reporting.
MiningWatch issued a July 10 press release highly critical of Hudbay’s environmental and social history. Hudbay responded with a July 16 letter attempting to refute MiningWatch’s statements and providing more details of the company’s position on the alleged human rights abuses in Guatemala. MiningWatch responded to Hudbay’s letter on July 23 with more details about the murder and additional shootings as well as ongoing environmental issues in Flin Flon.
As the public relations battle between the company and activists heats up, Hudbay has appointed Patrick Merrin to run its Arizona operations. Merrin told the Green Valley News that the company “will respect the permit” process and would not guess when construction would begin on Rosemont.
Hudbay assumed control of 92 percent of Augusta’s outstanding shares on July 17. On the same date, members of Hudbay’s management team assumed management positions with Augusta and replaced Augusta’s current senior management team.
David S. Bryson, Alan T.C. Hair, Patrick Donnelly and Patrick Merrin, each of whom is an officer of Hudbay, joined Lenard F. Boggio, Timothy C. Baker and W. Durand Eppler on the Augusta Board of Directors. Gilmour Clausen, Christopher M. H. Jennings, Robert P. Pirooz, Robert P. Wares and Richard W. Warke, resigned from the Augusta board.
Hudbay states it intends to delist Augusta from stock exchanges and the company will operate as a unit of Hudbay.
The proposed $1.2 billion Rosemont mine must still acquire a Clean Water Act permit that is issued by the U.S. Army Corps of Engineers. The Corps notified Augusta Resource officials last May that its proposed mitigation plan to compensate for the destruction of streams, washes and wetlands failed to meet regulatory standards.
The mile-wide, half-mile deep open pit mine would be built on the northeastern flank of the Santa Rita Mountains. The mine would located at the top of a watershed for sensitive environmental areas to the east, including the Las Cienegas National Conservation protected by the U.S. Bureau of Land Management. The mine would also negatively impact water quality and quantity of two streams — Davidson Canyon and Cienega Creek — that are protected from any degradation by Arizona law.
The U.S. Environmental Protection Agency has repeatedly stated that the proposed mine would have unacceptable environmental impacts. EPA has veto authority over Clean Water Act permits issued by the Army Corps.
Rosemont must also received a “Final Record of Decision” from the U.S. Forest Service under the National Environmental Policy Act. The decision has been delayed after an endangered ocelot was photographed by a University of Arizona camera near the proposed mine site.
The Forest Service and the U.S. Fish & Wildlife Service have opened renewed studies on the mine’s impact to the ocelot and other endangered species. The studies are expected to continue into 2015.