Advancing Together With Barrick Gold

People A tour of community development projects in Argentina

By Nancy White

Editor, Beyond Borders

Argentina’s western province of San Juan is a land of semi-arid desert, fertile oases and abundant natural resources. While neighboring Mendoza province is known for its wines, in recent years San Juan has emerged as an important mining center. It is home to Barrick’s Veladero mine, which began operations in 2005.

Located in the Andes Mountains more than 4,000 meters above sea level, Veladero is credited with marking the beginning of large-scale modern mining in Argentina. The impact of this single project has been huge. After just five years of operation, it accounted for 23 percent of San Juan’s entire gross domestic product and contributed to a marked decline in unemployment and poverty levels. Today, Barrick’s operations in San Juan province are supporting 6,500 direct jobs and another 30,000 spin-off job. Many of these jobs are connected to Barrick’s Pascua-Lama project located immediately to the south of Veladero. With estimated pre-production costs of $4.7-$5 billion, the project is one of the largest operations mounted by Barrick to date. It is scheduled to begin production in 2013. The Veladero and Pascua-Lama operations are evidence of Argentina’s emergence as a player in the global commodities boom at a time when demand for metals like gold and copper has never been greater.

I recently traveled to San Juan to visit the sun-drenched towns and villages surrounding these two sites. My objective was to see first-hand the community initiatives that Barrick has established in recent years. My trusty guides were my colleagues from the community relations team in San Juan. On this week-long journey, I would discover a roster of projects that formed the basis of the company’s strategy to contribute benefits to the communities in San Juan.

In the mining industry today, the ability to maintain the trust and support of local people living in the communities that host mining operations is critical. It requires that companies develop resources in a responsible way that complies with the regulatory framework of national governments and also meets international standards. “Communities impacted by mining activity need to see real and meaningful benefits, from good jobs, to opportunities for local businesses, to community investments that reflect local needs and priorities,” said Julio Claudeville, Community Relations and Sustainable Development Director for Barrick in Argentina. “Barrick is providing benefits in all of these areas.”

Barrick’s objective is to be a strong catalyst for social and economic development wherever the company has operations. That is a tall order, but in San Juan I saw ample evidence that this is the case. My colleagues and I visited small towns and villages, farming cooperatives, hospitals, libraries, computer labs, home-based micro-enterprises, and a multitude of other places in the two main provincial districts of Jachal and Iglesia.

Leading our group was Miguel Greco, Barrick’s Superintendent of Sustainable Development for Argentina. Greco is a former doctor and is often seen as the trusted face of Barrick. Greco and his teams in Jachal and Iglesia designed the projects I was to visit. They taught me that relationships are what count most, and that the company’s role is to engage with communities and let them tell us about their needs and priorities. “It is not primarily about money. People want to know they can trust you and work from a friendship that is based on mutual respect. That is how we can have the greatest impact and maintain support,” Greco said.

To get to the projects, we drove through the Andes Mountains, which provided unparalleled vistas at every white-knuckle turn. Greco and his team make this trip through steep winding roads two or three times a week.

Our first stop was La Cienaga, where a lack of access to potable water for homes and farms has long been the number-one issue for this rural village of 60 residents in Jachal. Barrick worked with the community and two levels of government to construct a sixkilometer water pipeline, with plans for further expansion. Milo Diaz, President of the La Cienaga Neighborhood Association, explained that before the pipeline was built, families didn’t have running water in their homes, which had a profound effect on their quality of life.

Since the pipeline was completed, the value of land in the area has doubled in just one year, small-scale farming has improved, and fewer young people are leaving the village. The enormous need for water infrastructure would be a consistent theme that I encountered in many San Juan communities. Barrick’s approach is to collaborate with governments, which have primary responsibility for this infrastructure, and engage the community directly in the solution.

As Greco pointed out, “At first, it was difficult, because some people thought we were Santa Claus, and it was hard to say no. But in time everyone understood that we all had to work together. We signed an agreement with the local and provincial governments, brought in technical experts and materials, and the community provided the workforce.”

Just down the road, we visited La Cienaga’s small primary school where 12 children were attending class. “The presence of this school was very important for me to be able to sell this project to authorities,” Greco said, noting the school will soon have access to running water for the first time in its 100-year history.

The school’s principal, one of two staff members, pointed out a poster for Barrick’s oral hygiene program on prominent display in the classroom. The program teaches children about good oral hygiene habits, and provides fluoride treatments, during annual school visits by dental health specialists. I learned that every school in Iglesia and Jachal is participating in this program. The program has been in place for nearly six years and has reached thousands of children. It is part of a major push to improve dental health and hygiene among children.

“People here have to send their kids to school and put food on the table. If a parent has to make a choice between putting food on the table and dental work, then they will have the tooth removed. The main focus of our program is to help change attitudes about proper dental care and promote good hygiene so parents in the next generation don’t have to make that choice,” Greco noted.

Our next stop was the San Roque Hospital, where we had an an opportunity to talk to medical staff about a women’s gynecological health and cancer-screening program that Barrick has funded for the past three years. This program targets low-income women living in remote communities who lack access to medical specialists. Speaking to the passionate women running this program, it was clear that early detection and treatment of gynecological diseases were helping save lives. Many of the 700 women who participated last year were bused by Barrick to special clinics where doctors performed free screenings for ovarian, uterine and breast cancer. One of the nurses on staff was proud to show us the mammogram and other medical equipment Barrick had donated to the hospital.

One of the most striking projects I visited was the new tourism center for Iglesia. Greco and his team came up with the idea of converting a former casino into a one-stop venue to promote in rural tourism to Iglesia. Historically, this remote community has been one of San Juan’s poorest, reliant on small-scale agriculture. Tourism emerged as an industry with potential in Iglesia about 14 years ago, when the Argentine government constructed a large dam that created a spectacular lake. That lake became a hot spot for windsurfers and other visitors to the area. In late 2007, Barrick began a series of consultations with community leaders and residents about the prospect of putting Iglesia on Argentina’s tourism map. The approach is aligned with the U.N. Millenium Development goal of promoting rural or “ecotourism” as a means of fostering economic diversification and growth in developing regions, while respecting the local environment and culture.

Barrick donated the material and the necessary investment for the new center, which today is averaging about 2,000 visitors a week. Visitors can watch videos and receive information about local accommodations and attractions. The Ministry of Tourism has hired two full-time employees to operate the center. In 2008, Barrick also funded the development of tourism promotion materials, which are displayed throughout the new center.

A leading proponent of the ecotourism model for Iglesia is Guido Altimira, President of the Neighborhood Association of Bella Vista. We visited Altimira’s scenic 12-hectare ranch, which features a bed and breakfast for tourists. Altimira is an ideas man and staunch advocate for potable water programs for Bella Vista. He is also a new-age farmer and has adapted modern irrigation methods to serve the needs of his ranch. Years earlier, when he first moved to the area, he launched a campaign with the motto, “Water is more precious than gold.” At the time, he was concerned that Barrick would fail to recognize that water is a shared community resource. It took two years for Greco and his team to build a relationship with Altimira and begin working together to address the region’s most pressing needs. On the day I visited, they discussed the need for greater Internet access and water infrastructure, while protecting the character and beauty of the area.

A key focus for Barrick’s community investments in Iglesia is to improve Internet access. This priority was identified following a baseline study that documented the limited connectivity of the region. We visited the main library in Iglesia, where we were given a guided tour by a part-time Barrick employee who is also providing oversight of a major, five-year expansion and upgrade of the library. This facility now features a state-of-the-art theater, a community center and a modern computer lab with Internet access, donated by Barrick. The computer lab is one of several the company has funded throughout Jachal and Iglesia.

It took a year of coffees to build the level of trust necessary to engage with Alfredo Rodrigues, the President of the Farmer’s Association of Jachal. Today Rodrigues is one of the company’s most important stakeholders in the region, representing some 450 farmers. Rodrigues was highly suspicious of the mining industry when it entered the region, but over time, as he began to engage with the company, a mutual understanding has developed.

We met Rodrigues at the association’s offices, which are located in a two-story facility whose construction was funded by Barrick. The building also features a farmer's market where local farmers sell their produce. During my visit, Rodrigues and Greco discussed the challenges facing farmers, which include limited water access and inadequate irrigation channels, as well as strategies to address these issues.

“The goal is to keep farmers on the farm, working and profitable,” Greco said, as we traveled to three cooperative farms in Iglesia and Jachal. “In San Juan, a number of family farms have a small plot of land and a single horse, and they struggle to survive.”

Our last stop was to El Porvinir, where we met Marcelo Tejada and a small group of farmers who run a successful 17-hectare cooperative farming operation. Greco’s team provided technical support, tools, machinery and fertilizer, helping to transform this farm into an international exporter of tomato and onion seeds. Tejada’s son is an agronomist who helps his father and also works part-time at Veladero.

The El Porvinir cooperative is one of several farming cooperatives in San Juan supported by Barrick that have become profitable agribusinesses. The company provides technical support, machinery, as well as access to leading agronomists to enable these operations to sell their seeds and sun-dried tomato products to countries like Holland and Brazil.

After a solid week of trekking through farmer's fields, meeting with community leaders, and visiting projects, I learned about the challenges people face in this region and the positive impact of Barrick’s programs. It is clear to me that Greco and his team are a part of the community and deeply invested in the people of San Juan and their future.