As conflicts turn deadly, gold-mining firms accused of 'moral blindness'

NYAMONGO, Tanzania — Barrick Gold Corp.'s North Mara mine near the Tanzanian border with Kenya disgorges millions of pounds of waste rock each week, piled high around communities where almost half the people live on less than 33 cents a day.

Children in school uniforms scurry across the rubble to reach their classes. Women with water pails atop their heads walk past the heaps. The piles grow as the longest bull market for gold in at least 90 years pushes Barrick, the world's largest miner of the precious metal, to increase production.

Villagers, too, are hunting the ore on the North Mara land that their ancestors worked for decades, sometimes paying with their lives.

Security guards and federal police allegedly have shot and killed people scavenging the gold-laced rocks to sell for small amounts of cash, according to interviews with 28 people, including victims' relatives, witnesses, local officials and human-rights workers.

"They are not arresting them or taking them to court," said Machage Bartholomew Machage, a member of the Tarime District Council, the highest local government body. "They are just shooting them."

At least seven people have been killed in clashes with security forces at the mine in the past two years, according to the 28 people interviewed. In at least four cases, police acknowledged the shootings in contemporaneous press accounts.

The dead include Mwita Werema, a father of four who was killed one day after gold set another record price in October 2009; Chacha Nyamakono, who was one year from becoming the first in his family to complete a basic education; and Daudi Nyagabure, shot in February, who was eager to build a future for his pregnant wife.

Fifteen people were seriously wounded in the same period, according to the Legal and Human Rights Center, a human-rights group in the Tanzanian city of Dar es Salaam, and Machage, who was the district council vice chairman until August.

Toronto-based Barrick and African Barrick Gold, which is 74 percent-owned by the Canadian miner, pay the Tanzanian government for federal police protection at the mine and employ private armed guards, according to company documents.

The violence at North Mara is a brutal dividend of gold prices that have risen almost threefold in the past five years to a record $1,431.25 on Dec. 7.

In written responses to questions about the situation, African Barrick said it frequently faces groups of intruders, often armed, who illegally enter the North Mara mine with the intent of stealing valuable ore.

It said some thefts, vandalism and other incidents are the result of organized crime, in part stoked by transients in the border region, said Andrew Wray, head of investor relations for African Barrick, in a written response to questions. The company declined to comment on the number of people killed or injured by security forces in the past two years.

"The villagers are human beings and so they would like to get the minerals, and the policemen do not want them to get to the minerals," Constantine Massawe, the commander of federal police forces at the mine and in the region, said in a Nov. 11 telephone interview. "If you tell them to leave, it's not easy to get them to leave." He declined to comment further.

Security at the mine, where there are four open-pit deposits, escalated after a riot in December 2008, African Barrick has said. A group invaded one pit, burned $7 million worth of equipment and cost the mine several days of production. Police shot and killed one trespasser, Wray said.

John McKay, a Canadian member of parliament who sponsored legislation that would sanction mining companies for human-rights abuses abroad, said he wasn't familiar with the North Mara mine and he declined to name specific operators. Still, he said, gold's high prices are causing a "moral blindness" at some companies.

"It seems like the attitude is, 'If we have to knock a few heads along the way, so be it,' because there is so much money to be made," he said. His proposal was defeated in parliament on Oct. 27.

The World Gold Council, the London-based mining trade group, helped boost the surge in investor demand that is bringing record results to Barrick and other members. It started SPDR Gold Trust, the first exchange-traded product backed by bullion approved in the United States, allowing investors — retirees and hedge funds alike — to invest in gold.

Those living near veins of gold are trying to profit from ore in their communities.

"There is awareness amongst communities about the fact that the gold price is so high, but that very little of the benefit from that seems to be coming back to them," said Keith Slack, the Washington-based head of Oxfam America's extractive industries program, which works on security and human-rights issues globally.

There are growing fears that the collision of these forces could yield a new wave of turmoil for years, Slack said.

Mwita Werema, 35, knew the risks of scavenging waste rock for gold, said his widow, Eunice Mwita. Her husband was a lifelong small-scale miner who lost his land to the mine in 2002, she said.

"He used to tell me, 'If they catch me one day, I'm sure they will kill me,'" she said, speaking in a whisper barely loud enough to be heard above the clucking of a single chicken just beyond her open doorway. Her four children played outside on a low, sallow mound of earth, their father's grave.

Werema was shot on Oct. 15, 2009. That morning he and his mining partner, Nchia Mwita, had worked their way deep into a vast area of waste rock that locals call the "Two-Six," which abuts one of the pits. They carried water bottles, hammers and their rucksacks, his friend said.

Each day, people flood the Two-Six, named long ago when the mine designated it rock pile No. 26, according to villagers. The daily activity supports a single-stool barber shop, operating from a shack erected on the stones. A handwritten sign identifies it as the Two-Six Hair Salon.

Nchia Mwita's and Werema's story mirrors the daily cat-and- mouse routine described by other miners. Typically they might get 30 minutes to sift stones before security guards appear and force them to flee, they said. They'll lie low for 10 or 15 minutes, then return.

Sometimes they can buy time by paying small bribes, which some police and security officers routinely demand, miners and local officials said. Mwita said those who are paid can easily betray villagers, turning on them if fellow officers arrive.

The day Werema was killed, he and his friend weren't prospecting long when two large crowds of scavengers began moving in behind them, working their way up the rock piles as well, Mwita said. About eight armed security men appeared on higher ground roughly 500 feet away, Mwita said. One guard began firing randomly at the crowd, he alleged.

Werema was shot once in the back and died, Mwita said. Police took responsibility for the shooting, but they said Werema was shot in the left leg. Mwita said he saw a private Barrick guard pull the trigger.

There's no mystery to North Mara's allure for locals. A bagful of the best waste rocks can be sold for the equivalent of a few dollars to buyers operating from the trunks of cars parked right on the rock fields.

Nyagabure Chacha, who lives in a hut near the rock piles, said those who own the mine and the people who live around it "are moving in opposite directions." The company is rising, he said, as the people fall.