Deno Gold: Mining Company Threatens the Residents and Environment of

Deno Gold: Mining Company Threatens the Residents and Environment of
Kapan
14:50, May 13, 2013

Canadian `Deno Gold Mining Company’ files a slander lawsuit against
Armenian environmental activist Yeghia Nersesian

The company claims that in December of 2012, during a meeting with the
Armenian community in the USA, Mr. Nersesian announced that Deno Gold
Mining Company applied electric shock to
miners[1].

However, the company denies the allegation and has gone to court seeking a
refutation of the slanderous charges which it claims tarnishes its `good’
reputation. The Armenian press has covered the Deno Gold Mining Company on
numerous occasions, thus allowing us to get an insight as to the company’s
activities and to gauge the extent as to how really `good’ that reputation
is.

Deno Gold Mining is one of the subsidiaries of Dundee Precious Metals Inc.,
a Canadian-based international mining company. The company was established
in 2004, in the Syunik Province town ofKapan. In the official web page of
Dundee Precious Metals the
company’s operating principles are clearly marked – transparency, respect
of human dignity, safe working conditions, environmental responsibility,
etc. Similar values are indicated in the web pages of almost all mining
companies. However, these values are not demonstrated in Armenia and other
countries like it, which have essentially become raw material sources for
other countries. Deno GoldMining is no exception to this rule, and has
repeatedly violated and continues to violate the above-mentioned values.
This is evidenced by numerous press publications, which we would like to
refer to in sequence.

Environmental issues

In its stated principles, Dundee Precious Metals mentions that it has
undertaken certain environmental obligations which stipulate
environmentally friendly operational activities. However, the facts
show that `Deno Gold Mining’ does not fulfill its environmental
obligations or either does so at an extreme minimum level. For
example, the company’s Geghanush tailings dump has experienced a
number of break downs[3]. According to studies, on November 15 and
December 1 of 2012[5] environmental damage was caused to the
surrounding land and water resources (the damage was estimated
respectively at 2.280 million AMD and 2,000,048 AMD).

In fact, residents of the community initially opposed the construction
of the tailings dump[6]. However it was built, thus violating the
right of residents to participate in a decision making process that
would affect them.

Moreover, the company initially claimed that the Geghanush tailings
dump project had been designed by incorporating the best of
international experience, and that therefore, the impact of the dump
on the environment had been reduced to a minimum. Two accidents that
occurred in the tailings dump prove the opposite. In 2013, according
to the report drafted by RA National Bureau of Expertise, SNCO, the
piping system of the Geghanush tailings dump was constructed on the
old dump, that violations were made, and that it doesn’t comply with
the original blueprints. Funding was made through a $4 million credit
instrument of the European Bank for Reconstruction and Development
(EBRD)[7]. If there are deviations in the design and construction,
and accidents are being recorded in the tailings dump, hence the
funding failed to achieve its objective. Last, but not least, the
environment and the residents of the community are not protected
against future accidents.

In a 2007 environmental audit of the `Deno Gold Mining’ CJSC, a number
of violations in the mining sector were uncovered. According to the
Syunik Regional Environmental Inspectorate, the fines for the
violations exceeded 300 million AMD; that’s to say that 550 kg of gold
were misappropriated[8].

In 2008, the company was subjected to a double audit by the RA Ministry of
Environmental Protection of RA double audit. As a result, the fines levied
in 2007 were reduced by almost 20 fold to 12 million AMD; that’s to say
that 50 kg of gold were misappropriated. Mining expert Samvel Gasparyan, a
member of the first inspection commission who detected the above mentioned
violations, was not included in the inspection commission during the double
audit in 2008 and the contract with him was
terminated[9].

Hence, reasonable doubts arise that there are corruption risks in the
activities of Armenian officials. And the irresponsible operations of
mining companies leads to the fact that the organization damages the
environment and then avoids full liability. Thus we rightly ask – Did the
Canadian company assume environmental responsibility with the intent to
only partially implement them, without compensating for the damage caused
to the environment and people, via a tacit agreement with corrupted
officials?

In addition, scientific studies of the RA National Academy of Sciences’
Center for Ecological Noosphere Studies also shows that as a result of the
activities of Deno Gold, the Kapan community and surrounding communities
have been polluted by heavy metals and toxic elements. However, the company
has not taken any steps to eliminate the
damage[10].

Moreover, due to the exploitation by the company of the Shahumyan
poly-metallic gold mine, it is being impossible to live and to be
engaged in agricultural activities in that area. But the complaints of
the residents remain unanswered[11].

Respect of a man’s labor

In its stated values, Dundee Precious Metals notes its respect of a
man’s labor and career development, the importance of honesty in
communication with partners, and finding solutions which will respect
the needs of the people and corporate interests. However, since 2009
Deno Gold has experienced periodic waves of protests and strikes
lasting days on end. The reasons for the unrest are unpaid salaries
for night shifts and dangerous work, employee layoffs and low
wages. Moreover, strikes and complaints are followed by unjustified
terminations which trigger new waves of protest[12]. Most of the
workers fired are those who have participated in the strikes and have
demanded the restoration of their violated rights[13].

As of 2011, according to the data, the company owes its employees 11
million AMD just for night shift payments per month. Hence, it has an
annual debt of 264 million AMD just for night shift payments, which
accumulated due to the incorrect application of the law[14].

Many of the workers were able to receive their salaries only by court
order [15].

It was only in the spring of 2011 that Deno Gold Mining fully paid its
former and current employees for their 2005-2007 unpaid night
shifts.[16] One court case vividly illustrates the extent to which
Deno Gold Mining takes care of the health and the protection of the
rights of its employees.

The company had fired one employee who fell sick due to working in the
mine, thus avoiding transferring him to another workplace more
appropriate to his state of health and refusing to cover medical
treatment costs. The employee was forced to file a lawsuit against the
company. Only then was he able to restore his right to work and
receive medical treatment[17].

Operational Transparency

The company indicates that it works transparently and openly with its
employees and partners. However, it mostly does not bring forward
legitimate arguments for dismissing its employees. Besides, a significant
violation of a transparent work-style is that Deno Gold Mining repeatedly
refuses or avoids providing information about its activities, which
directly relates to the health of the residents of the RA and environmental
problems. The media has repeatedly mentioned that they are not provided
with the results of the environmental audits of 2007-2009.

Environmental organizations have also applied to `Deno Gold Mining’ in
order to obtain the copies of environmental audit acts implemented to date
and inquiries have been sent to find out whether the employees have medical
insurance, what kind of medical examinations the workers undergo, what kind
of diseases were discovered, etc.

In fact, `hetq.am’ online newspaper notes that they have a document at
their disposal where the results of another audit conducted in 2010 are
marked. According to this audit the following amounts were not calculated
in the reports of the first quarter; Zn-152.20 t, Pb-22.7 t, Au – 38.81 kg,
Ag -100 kg. Deno Gold Mining was fined 250 million AMD for the uncovered
violations. Today, however, there is no such legal indictment and the
Ministry did not note this audit in its reply to Hetq Online. Where did
this indictment disappear and what kind of transparency and accountability
can we speak about?[18]

But many of the inquiries remain unanswered to this day. During a
recently organized conference, the company’s newly appointed director
Hrach Jabrayan publicly announced that he is not going to provide
environmental activists with any information about their activities
because `they have offended him’ [19]. This merely goes to prove that
the company is not working openly and transparently.

Safety at issue

The company also points out that the health and safety of their employees
is of paramount importance in their system of values and that there can be
no question about the safety of workers. But unfortunately, a number of
deaths have been recorded in the Deno Gold mine. There are at least 6
deaths recorded by the Armenian press that occurred in 2006, 2008, 2009 and
2011.[20]
We
are aware of the investigation results of only one of these deaths.
According to the results, a number of mandated working conditions have not
been met, which could lead to these accidents, although not being the
direct causes of
them[21].
The question is, which are the security guarantees which cannot be subject
to further discussion and which should protect the lives, health and safety
of the employees of the company. Do employees in fact have life insurance
contracts? By the way, on the official Dundee Precious Metals website, only
one death at Deno Gold Mining Company has been
listed[22].
What answer has Deno Gold Mining Company given concerning all the deaths
mentioned in the media? What are the causes of the deaths of these
employees? Why has the company failed to provide any public explanation to
date?

Community and social projects

It’s hard not to share the belief of Dundee Precious Metals Company that
companies must strive to create better living conditions for the residents
of the community where they operate and to make further investments in this
matter if needed. But as a result of Deno Mining Company’s operations, a
lot of people have either left their place of residence or have been
evacuated. But the question arises, how does the company envisage helping
the community and making it a better place for living? Is evacuating
residents from their homes the best solution they have got?

A lawsuit against an environmental activist and a new project on
exploitation of mines

Deno Gold Mining Company has repeatedly violated the rights of its
employees. Its operations have damaged the environment and caused injury to
people’s health. It has not ensured the safety of the tailings mine that
was being exploited. To date, no information requested by the public has
been provided. Despite all of this, the company still has plans to openly
exploit the Shahumyan gold mine, even when there are numerous professional
arguments against
it[23].
It’s true that the company denies the rumors of ever using electric shock
on its workers and is trying to regain its `good reputation’ through a
lawsuit. However, it must be pointed out that this information has appeared
in the media long before Yeghia Nersesian’s speech. According to the
periodical Syunyats Yerkir, former Deno Gold Mining Company General
Manager Robert Faletta was willing to subject disobedient miners to
electric shock. According to the periodical, `the owner of the company has
been informed about it a little bit late, which caused it to become a
subject of special
consideration'[24].
.

In April 2012, one of the environmental activists, Mariam Sukhudyan,
had pointed this out during an interview[25], but to date the company
has not presented a refutation demand. Incidentally, in an article
placed on 1in.am, it is noted that `Arajin Lratvakan has been
successful in verifying the fact that electric shock equipment had
been purchased. But it was not for disobedient workers and had to be
used in special cases'[26]. Now the company denies that they ever
purchased electric shock equipment. Probably the news site also had
to be summoned for questioning? So shouldn’t the news site be
questioned as well and asked to clarify the exact source of this
information? One notable fact is that the company general manager
Robert Faletta was fired in 2011, after continuous worker strikes and
court cases and rumors about the use of electric shock.

The question then arises, why was a lawsuit filed against Yeghia Nersesian
and why especially after the speech he had made in the United States?
Conclusion can be drawn that Yeghia Nersesian’s speech in the USA enjoyed
wider publicity, and Deno Gold Mining Company demands not to tarnish its
reputation to have better opportunities to get a 40-million-dollar loan for
exploiting a new mine. However, many citizens are skeptical about its
statements because they have already witnessed serious contradictions
between the values proclaimed by Deno Gold and its actual operating
procedure. The good reputation of the company is being tarnished due to its
own flaws, violations and lethal activities. Therefore, we have
substantial reason to believe that the pressure used against activists
seeks to silence the voice of the environmentalists and to implement the
company’s next project, which is to exploit an open mine situated only
1.5-2 km away from a residential area.

We demand that Deno Gold Mining Company, owned by Dundee Precious Metals,
remains committed to its declared values of not causing harm to the
environment. They must also adhere to their assumed obligations and respect
the rights of the workers and provide them with working conditions that
will not endanger their health and lives.

We would like to appeal to our compatriots the world over to give voice to
their complaints regarding the irresponsible and illegal functioning of
German, Canadian, American and Russian companies. We urge our compatriots
to follow the operations of all those companies which exploit mines
in Armeniaand fail to meet their obligations, thus causing harm to the
Armenian people and the nature ofArmenia. We make this appeal because your
direct participation and support in this matter is of crucial importance.

We urge you to join our struggle through any means accepted by the law –
appeals, claims, petitions, preparing and publishing complaints, interviews
with the media, protests in front of the administrative offices of these
companies and other major events. Any lawsuits filed against environmental
activists cannot stop us to fight against the eco-colonization
of Armenia and for the protection of Armenia’s Mother Nature and for
establishing social justice. Through concerted efforts we will be able to
put an end to the numerous environmental problems in Armenia much more
easily and quickly. Be informed, join, give your support and don’t forget
that the protection of the environment is also the protection of Armenia!

(For references, we have put those articles which are translated into
English in the Armenian media, the ones that have not been translated, you
can find in Armenian).

Pan-Armenian Environmental Front

Facebook group:
E-mail: [email protected]

Contact persons : Levon Galstyan, Anna Aghlamazyan, Mariam Sukhudyan

Skype: armecofront

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[1] (22:28)

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[9] See link 7

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[20]
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[26] See link 21

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