Bloodshed on the Yellow Brick Road

By Christopher Lim

On Friday October 31, 2006 the Canadian based gold producer, Crystallex International Corporation began its much anticipated diamond drilling program in Las Cristinas, Venezuela. The project consists of forty 11,500 meter deep bore holes spread across three different regions (west, southwest, and north) in one of the biggest gold deposits in South America. The program is expected to yield approximately 13.6 million ounces of gold.

With little or no government oversight and a low cost structure, the outcome looks as lucrative (as is obvious) for Crystallex who stands to win much more than it will ever lose from a $1.6 million project. Future doesn’t seem as glamorous for the residents of Las Cristinas, who have not enjoyed the life of a town that suddenly “struck” gold. In fact life in Las Cristinas has been as steady as a rock for quite a while. For more than four decades, since the untapped mine’s wealth was parceled off as mining concession in 1963, there have been endless legal battles over the concession titles of the gold mine, and for forty long years the natives of Las Cristinas have yet to see the yellow brick road. In 2002, President Hugo Chavez finally turned over the mining concession to Crystallex, and after additional four years of its own legal battles, operation has finally begun. The inception of private investment in Venezuela’s mines means, however that the residents are no longer able to exploit their own gold as the proprietorship has been transferred to a foreign entity by federal law It’s not surprising that at another gold deposit known as La Paragua, where they have yet to sign private drilling contract, residents have started mining minerals on their own, “illegally” of course. Living in ramshackle homes crammed on top of one another in garbage-strewn streets without clean water and steady income, tens of thousands of locals have turned to dangerous mining activities as their chance of survival in their impoverished village. What’s more tragic here is that regions like La Paragua with gold deposits have come under the watchful eyes of President Chavez, who is trying desperately to stop the informal local mining, citing “environmental concerns.” But is the President really worried about environmental damage or about his gold deposits that may someday bring him another multimillion dollar contract?

Since coming to office in 1998, President Chavez has championed the welfare of the poor by passing social development programs that provided cheap food and free health care, but has recently turned his back on the majority, when he privatized mining activities to the foreign companies, stripping people of their only source of income. The inevitable monitoring of gold deposits then followed as Chavez used armed military to enforce his mining ban, which has resulted in multiple incidents of unjustified military violence and murder. In September 2006, Manuel Felipe Lizardo, a local miner, who survived his run-up against the federal troops, told reporters how the army arrived in Chavez’s newly bought Russian helicopter, forced the miners to lie down on the ground, and murdered them. Lizardo was lucky enough to survive the gun shot wounds. Along the Caruca River, locals accuse the soldiers of burning four men to death, and stealing their gold and diamond. In March of 2006, two men from La Paragua were also killed by the army. As similar stories of violence and murder emerge across Venezuelan mining sites, it’s hard not to question Chavez’s ulterior motive in protecting these areas that may perhaps involve things more tangible than just saving the environment.

Still in the midst of bloodshed and violence, the illegal mining continues in La Paragua. While Crystallex has promised local miners and residents of Las Cristinas access to drinkable water, a medical center and 1600 jobs by the end of May 2007, the people of La Paragua have nothing left but gold to dig. For as long as there’s gold to be found, there will always be miners around. And for as long Chavez runs the office, there will be more blood to be shed, unless of course he implements another policy turn-around in his fickle state of politics that is Venezuela’s democratic socialism.