Analysis: Illegal gold mining in Peru set to continue

The price of gold is sensitive to crisis, but can itself be the cause of turmoil, especially in an environmental context.

During the past year and a half of the global pandemic, the gold price reached historic heights. As a result, an artisanal gold-mining boom swept the world, notably in countries that are but resource-rich.

From African states like Ghana or the Democratic Republic of Congo, to Indonesia in Asia, dangerous and often deadly illegal gold-mining has flourished.

Some criminal narcotics gangs are even said to have dropped the drug trade and are concentrating on artisanal gold mining because of its higher profitability.

Despite a global illegal gold-mining trend, its impact might be nowhere near as consequential and devastating for the climate as it is right now in Latin America. 

Particularly at risk is one rainforest region in Peru, the 85,301 km² larger Madre de Dios region, which has suffered vast losses.

Areas of rainforest that are cut for illegal gold mining are a key element in stabilising the global carbon balance, says Luis E Fernandez, executive director of the Wake Forest University’s Center for Amazonian Scientific Innovation (CINCIA), a research initiative examining the impacts of artisanal gold mining in the Peruvian Amazon.

Places like the Amazon rainforest and other tropical areas like the Congo and forests in Southeast Asia, are all hotspots for artisanal mining, he says. 

Satellite images of areas in the Madre de Dios region show the vast destruction. Deforestation between 2001 and 2020 increased in tandem with gold price changes, losing around 272,000 ha of tree cover, data from the World Resource Institute shows. Some of it is down to artisanal gold mining. Then came the pandemic. Between last October and March this year, illegal mining destroyed more than 15 ha of forest around the river in the southern part of Peru’s Madre de Dios region. 

Arial images, some taken by an astronaut on the International Space Station, that went around the world in December 2020 provide proof for the invasive nature of artisanal mining and the inability of authorities to curb it.

Authorities have tried. A 2019 crackdown operation called Operation Mercury yielded some results. It mainly helped to displaced illegal miners to other areas, driving some to the Pariamanu region. Subsequently, an extension of Operation Mercury focused on that area. But the miners are agile. It's a vast system of well-oiled machinery, Fernandez explains.

The system guarantees to offer employment to locals hart hit by the pandemic, to fund mining equipment and to pay for corruption and bribery for the police to "look the other way", he says.    

"We’re not talking small potatoes here," Fernandez told E&T. The artisanal mining business represents millions. In the case of Madre de Dios, it’s a business estimated to be worth around $3bn a year, he adds.

The invasive nature of the forest destruction can easily be seen from space and occurs as illegal miners dig down into the soil until they hit bedrock. 

Unlike deforestation to create farmland, the illegally mined areas are wrecked often for generations as nothing new can grow on the vast cheese-holed landscape that is left behind. 

Many hope that remote sensing can improve monitoring. The Center for Amazonian Science and Innovation (CINCIA), an alliance created to strengthen science, research, and innovation in the Amazon to protect the environment says tools like artificial intelligence and NASA’s remote sensing capabilities will help not only to spot but also to prevent illegal acts and preserve the Amazon.

Mercury poisoning is the other big and invisible problem that plagues Madre de Dios, Fernandez says. Mercury helps miners to bind gold dust into lumps. Miners work without protection, often engage their whole bodies in the process. Through rivers alongside the mines, mercury ends up highly concentrated in seafood that locals consume, poisoning them slowly over years. 

The controlled substance, only really obtainable via the black market, can have devastating effects on the human body, especially for children. In a recent study conducted in the Peruvian Amazon, the level of hair methylmercury was associated with anemia in children living close to an artisanal or small-scale gold mining community. Illegal miners often carry mercury around in Coca Cola bottles, Fernandez says.

With illegal gold mining in South America increasing there is also more organised crime, violence and people trafficking, especially around mining cities such as La Pampa, Peru. In neighbouring countries such as Brazil, incidents were reported where indigenous groups were attacked in the rainforest by illegal miners. 

Will the price of gold nosedive anytime soon and alleviate pressure on rainforest regions, their people and indigenous land? Fernandes is sceptical. The gold price will stay up, he thinks. “I don’t know the future, but from what I’ve seen, the price has been unusually stable over the last 10 to 15 years”. It hasn’t exhibited the typical up and down cycle that it has shown in the past. By remaining relatively high, it will only exacerbate the calamity it causes in the rainforest.