The Orinoco Mining Arc’s Impact: A Conversation with Emiliano Teran Mantovani

A researcher and environmental activist explains the political, economic and environmental issues surrounding Venezuela's controversial mega-mining project.

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Emiliano Teran Mantovani studied sociology in Caracas’ Universidad Central de Venezuela.
Emiliano Teran Mantovani studied sociology in Caracas’ Universidad Central de Venezuela. He is pursuing a doctorate in Science and Environmental Technology at the Universitat Autonoma de Barcelona. In 2015, his book El fantasma de la Gran Venezuela (The Phantom of the Great Venezuela) received an honorable mention in the Premio Libertador al Pensamiento Crítico. (Archive)
By Cira Pascual Marquina – Venezuelanalysis
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Emiliano Teran Mantovani, a member the Venezuelan Political Ecology Observatory, has closely followed the emergence of the Orinoco Mining Arc. He sees the new series of megaprojects as disasterously accelerating an uncritically accepted extractivist logic. In this interview, Teran argues that there are alternatives to an economy based on extraction which, aside from the environmental and social damage it produces, has failed to deliver results in terms of capital accumulation and development.

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Deforestation and the creation of pools with the high-pressure water pumps used to dislodge gold are inevitable results of mining in the Orinoco Arc
Deforestation and the creation of pools with the high-pressure water pumps used to dislodge gold are inevitable results of mining in the Orinoco Arc. This open pit mine is near Angel Falls. (AirPlano)

There is a tragic lack of knowledge about the Mining Arc in Venezuela. Can you, very briefly, tell us something about when it got started, its scale, scope and environmental impact?

The Mining Arc was proposed not too long ago, in 2011, by Hugo Chavez... But I would like to add the following: in reality, the Mining Arc emerged as a project during the second government of Rafael Caldera, in which there was a dispute about the environment that would resonate in public opinion in the mid to late 90s. That was when Caldera put forth a decree deregulating the forest reserve Imataca to introduce mining there. It is where the gold mines are today that are the main focus of the mining in the Mining Arc. The mobilization [against it] was such that that decree remained in some way neutralized. It wasn’t taken down, but it was neutralized. They couldn’t bring it to completion. It’s with Chavez then that this decree finally formalizes itself... making it permitted to carry out mining in that forest reserve.

That story is important to tell, because it comes from a whole logic of recolonizing the South, a logic that has been part of development projects in Venezuela for a long time. Actually, all the contemporary developmental, progressive projects (like the Bolivarian Process) followed that logic.

In 2011, under Chavez, the Guyanese Mining Arc or Orinoco Mining Arc was announced. Then there was talk of even a two-pronged project together with the Orinoco Oil Belt, with mining projects over the whole extension of the territory. We are talking about an extension of 111,800 square km, 12 percent of the national territory, that is about the size of Cuba, to get a sense of the scale. Mining of gold and diamonds, coltan, bauxite and iron are the proposed projects.

This involves reopening and giving a new push to already existing mines. It’s not as if all the mines are new ones. There are already-existing mines that will be given a new push, but it also involves opening up new mines. For example, coltan mining is totally new in Venezuela and it means penetrating the Paraguasa forest and opening coltan mines there. It also means opening new mines in Imataca, formalizing diamond minds in the west of the country, and expanding the mining of bauxite and iron, which is old in Venezuela.

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Map of the area covered by the Orinoco Mining Arc, which amounts to 111,800 square km or 12 percent of the national territory
Map of the area covered by the Orinoco Mining Arc, which amounts to 111,800 square km or 12 percent of the national territory. (Mining Press)

The Orinoco Mining Arc involves new legislation that, in effect, puts the zone outside of normal law and the Constitution. One could even talk about a regime of exceptionality, deterritorialization, and loss of sovereignty. Can you say something about the conflict between popular sovereignty and the needs of global capitalist accumulation?

That is very important. At first, for Chavez’s government, the Orinoco Oil Belt and what we now know as the Orinoco Mining Arc were initiatives aimed at overcoming the exhaustion of the model of accumulation via oil exploitation. Before Chavez, the focus was the extraction of light and medium crudes from [the western border state of] Zulia, but those wells were drying up. So, within the [extractivist] model, there is a shift to extracting non-conventional oil from the Oil Belt region [in the east of the country]. This, of course, has a much greater environmental impact and greater cost. Hence, the Mining Arc follows the same logic, bringing new life to a model in crisis.

I say this because, if during Chavez’s government the Mining Arc had a character of expansive developmentalism – a kind of reformulation of the extractivist model, under the Maduro government the focus on mining takes on the nature of an adjustment policy. It’s a radical adjustment, even it it isn’t the typical macroeconomic adjustment (which would be about redistributing surpluses upward).

This adjustment has to do directly with territorialization[1] and radical penetration [of national sovereignty] based on a few instruments. First, since 2016, Venezuela has been under a formal and declared state of exception. That state of exception is within the context of an economic emergency.

Then, there is another instrument: the Special Economic Zones. These follow the format of Chinese neoliberalism, a form of radical deregulation of territories, in which any obstacle for capital’s rapid development is eliminated: taxes, customs, permits, labor laws, environmental restrictions, you name it. This state of exception even means assigning a sort of ad hoc governor to the territory in question.

The Orinoco Mining Arc was finally formalized, in its current incarnation, in February 2016 with Presidential Decree 2248. It was declared a special economic zone. As such, it is constituted as a territory of complete deregulation, so that capital can develop freely at whatever price. That presupposes eliminating of rights of all sorts: democratic consultation, the right to work, the right to life, the right to a clean and healthy environment, etc.

The regime of exception was put in place hand in hand with a special military zone. So the Mining Arc is both a special mining zone and it is a special military zone. It has a special military regime. How? Well, Decree 2248 states that groups who oppose it are opposing national interests, and in opposing national interests they enter into a kind of crime against the state itself. That is said very clearly in Decree 2248.

Now, when you look at this from the point of view of democratic consultation – which, in a project of this magnitude, must be done not only because it is stated in Venezuela’s Constitution, but also because of international law – the process has been carried out in very irregular ways, with a lot of manipulation and co-optation. To give one example, indigenous people have complained about television appearances of co-opted chiefs who don’t represent them, and these co-opted chiefs were backing up the project.

Additionally, environmental impact studies are conspicuously absent. They have been announced, but nobody knows where they are. Nobody knows anything about them. Add to that that citizens have the right to be informed about the character and scope of the agreements that have been made, but they remain a total mystery. All the information that we have is based on promises of ecosocialism, but we know, based on scientific studies and Latin America’s accumulated experience, that megamining is one of the most devastating industrial activities. So clearly the Mining Arc represents a regime of exception following a policy of adjustments of the most radical kind, a neoliberal path that is very radical.

Clearly, as you mentioned above, megaprojects with this kind of impact need to be submitted to participative processes and democratic ratification. Yet, many of the peoples who live in the Mining Arc are those least able to make themselves heard in the centers of power. This seems all the more tragic since such peoples often have cultures and sustainable forms of life that might be all the more important in forming and shaping a viable postcapitalist society.

The people who live in the Mining Arc are diverse. They are not only indigenous people. We should remember that there are cities like El Callao, which has a mining tradition since the 19th century.

Regarding indigenous people, what you have said is key. The indigenous peoples are not a subject that is separate from us. True, geographically that has generally been the case, but politically indigenous peoples are constitutive of our identity as the Venezuelan identity is pluricultural. Venezuela is in reality a republic constituted by very diverse cultures, not only campesino cultures but also indigenous cultures that shape us as far as our traditions and habits go and our way of viewing life, our way of eating, dressing, etc. All that is part of our identity. They are not subjects that we have to thank, but rather they are a part of us.

In their forms of life, their cosmovision, we find hints or clues to conceive of other ways of living, an alternative to the model that exists in the present moment. These aren't things that are in a far future or remote past, but instead have to do with practices existing right now. These include practices of the Yekuana people, for instance, who have their own conception of “living well” (buen vivir), but also ways of working the land, medicinal practices, social practices.

I don’t think it’s good to romanticize the indigenous peoples, since they have been culturally penetrated and many now have become involved with mining. It’s simply a fact. They have been subjected to a long process of colonization, although it is also true that in the Bolivarian Revolution their rights were constitutionally recognized. But, with the co-optation of leaders and the creation of indigenous bureaucracies, their constitutional rights were bypassed.

When we talk about a rehashing of colonization and territorialization, we can point to two grave factors. First is the issue of health. The state of health of some indigenous peoples in the area points to the danger that some of the tribes could disappear soon, because they are dying of measles, malaria and other diseases that have spread rapidly due to deforestation and rechanneling water.

There is an idea circulating in the public arena, which is that the solution to the problem of illegal mining is large-scale mining. It is true that since the middle of the last decade, illegal mining grew exponentially. Chavez first responded to that by developing programs and projects so that people would have other alternatives. Today, with the excuse of organizing mining, those programs were abandoned and, with the territorial expansion of mining, well, naturally indigenous groups lose sources of income such as tourism. This is the case with the Pemon people, who have seen tourism fall off dramatically and are thus obliged to mine.

And so it becomes true that big corporate mining is the only option. Or is it? Really, instrumentalizing the environmental devastation that industrial megamining causes cannot be the only option.

The other problem with illegal mining, which is alive and well, is that it is not outside the state, because part of the state collaborates with the process. It’s not possible that ten or twelve tons of gold could be smuggled out of the country every year, which is what public functionaries say, and that nothing can be done about it. For instance in El Caura the only way people have to get the gasoline for the pumps (to get the gold out) is through military posts. So we are talking about a participation of the state in a process that is bleeding dry the country.

Also, illegal mining, among other things, leaves giant pools in the process. They use spouts of high pressure water to make landslides to access the gold. Pools are left behind where mosquitos reproduce, and we see that now Venezuela has the worst index of malaria in Latin America, according to the World Health Organization. The situation is affecting miners and the local population first, with devastating consequences, but the phenomenon is spreading north throughout the country.

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To extract gold, pools of water are created. These pools are then abandoned and become breeding sites for mosquitos
To extract gold, pools of water are created. These pools are then abandoned and become breeding sites for mosquitos. (Archive)

Who are the main actors involved in the Mining Arc?

In the Mining Arc, full-scale operations haven’t yet begun. We are, basically, in the first stage of a large-scale initiative: attracting of investors. To state the obvious, the Venezuelan situation is one of high political vulnerability – it is considered volatile – and this makes large investors leery of making investments that might be followed by losses.

What has been happening is that the state has initiated a sort of process of auction, offering better and better deals, better and better concessions to corporations. Hence the creation of the special economic zone, and more recently the lifting of all tax payments [Economic Recovery Plan], and the granting of other advantages for large corporate interests.

The government spoke initially about some 150 companies from more than 30 countries being involved. Many of the deals have been verbal negotiations, others have been memorandums of understanding, which is when two parts sign a document stating that the parties sat together to negotiate, but it’s not an actual agreement.

Mining has begun by companies such as Canada’s Gold Reserve − a company that Chavez’s government kicked out of the country in 2009, due to the environmental impact of its projects in the Imataca Forest Reserve. Further, there have been some real agreements with Chinese corporations. This has occurred in the following way: when Venezuela asks for a rescheduling of its debt payments with China, then, as a payback... China asks for broad concessions. This is how things took shape for the projects of Chinese companies such as Yankuang Group (which has been mining gold since 2015).

The corporations that have initiated exploitation are junior mining companies. A junior mining company is like a chess pawn… They basically initiate negotiations, opening a path so that, once the situation is stabilized and the agreement consolidated, then the large corporations such as Barrick Gold can come in. Gold Reserve and the other corporations that have come in are, basically, junior companies.

Other key and highly problematic actors in the Mining Arc are the military companies. These are made by military people who form companies that enter into joint businesses (with the Venezuelan state). CAMIMPEG is one such enterprise, but there are many others. This is, in fact, a rebirth of the sort of concessions that Juan Vicente Gomez gave out in the early 20th Century: small coteries of friends that divided up the pie of state offerings.

A radically anti-extractivist position seems unfair. How are nations of the Global South to advance when, in the short and medium run, their only chances to develop seem to be via extraction of raw materials. Many countries of the Global North transitioned from extractive economies to industrial ones in modern times. So, wouldn't it be unfair to deny that possibility to nations of the Global South? Isn't it unjust to make the nations of the Global South bear the burden of the planet’s environmental crisis?

I’m not sure that I agree with some of those claims. First, the past fifteen years of progressive governments in Latin America have been characterized by an extractivist logic. These weren’t decisions made by the people; the decision came from above. We saw them playing that card, as if there were no other options.

Let’s go over one of the typical arguments given: “We need to open this new mine, we need to open a new oil well, we need to initiate new projects of soy monoculture.” And why do we need to do this? Because we need hard currency for development.

One of the issues here is that there is no discussion about how to distribute the surplus. The reasons for opening our territory to mining is the same: hard currency is needed. But if we look at the ten years prior to 2014 (when the price of raw materials dropped), in those ten boom years, some 500 billion dollars came into the coffers of the Venezuelan state. So, before opening a new mine, the question we should ask is, what happened with all that money?

To understand Venezuela’s rentier capitalism one must understand the country’s architecture for the distribution of the oil profits. That architecture shapes the whole national domestic economy. The distribution of oil profits shapes power relations and diverse forms of consumption. In other words, if the state has an eternal subsidy to gasoline, as is the case in Venezuela, that is going to foster a specific kind of consumption. It’s going to determine the way people go from one place to another, and promote the widespread practice of importing vehicles.

Further, when we talk about distributing oil profits, we also have to talk about taxation. According to CEPAL data, Venezuela and Chile are the countries in the continent where the rich have to pay the least income tax. [In Venezuela] the sales tax, a regressive tax, has increased, and it falls on the shoulders of the poor.

How can we connect this with extractivism? I’m going to give you an example. One of the largest debates concerning extractivism in Latin America was regarding the Yasuni National Park in Ecuador. If you increased by 1,6 percent the taxation on the 200 largest corporations and wealthiest families, that would bring into the state’s coffers the same amount of money as would be brought in by 25 years of oil extraction in the Yasuni reserve.

This is the case with any Latin American country. Instead of opening the debate on the issue of unequal distribution, the only solution that enters the discourse is exploiting natural resources: opening new fields, new mines, etc. Then, when the prices of commodities drop, then the discourse gets ramped up: more extractivist initiatives have to be pursued because there is a crisis and, of course, the only solution then is mining or drilling more wells. However, it turns out that we got into the current crisis because the extractivist logic was on steroids during the last decade and a half.

Additionally, mining has an impact on other kinds of industry, since it affects electrical production. In Venezuela most of the electricity comes from hydroelectric plants. But the kind of mining that happens in the Arc will affect riverbeds and reduce the flow of the Caroni River, which is the river that feeds the Guri Dam, the main source of electricity in the country. Thus the generation of electricity will fall off. That is going to have an adverse effect on the economy, even on the existing oil refineries and other sectors of the oil industry.

Unfortunately, debates about mining and extractivism are silenced. So it turns out that the Mining Arc is going to end up adversely affecting productivity and life in Venezuela, and that includes oil production, which is actually effective in generating income for the nation.

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The Caroni River basin and the pools created to extract gold, which affect the flow of water and thus the generation of energy at the Guri hydroelectric plant.
The Caroni River basin and the pools created to extract gold, which affect the flow of water and thus the generation of energy at the Guri hydroelectric plant. (Archive)

What can people do who want to monitor, protest or simply stay informed about the Mining Arc?

It is necessary to get people mobilized again, and that mobilization must be autonomous and independent. We are facing a government that has deviated from its path and has little to do with the initial project of Chavismo’s popular bases, which had an emancipatory orientation and proposed an alternative transition. That bloc must recover its social agenda that involved demands regarding labor and salary, together with claims related to gender, indigenous rights, and the land.

There is a very serious environmental crisis in Venezuela and the environmental agenda must be taken up by all, focusing particularly on a struggle against this new form of “adjustment extractivism.” There are alternatives, and the popular movement has to forge a project: a path away from the current devastation that we are witnessing in Venezuela. That, in turn, requires a process of autonomous construction and debate, allowing us to overcome the current logic of environmental devastation.

NOTES

[1] “Territorialization” with regard to neoliberalism refers to a process that involves the state passing over authority to non-state entities, which expand their control of a territory.