MercoPress. South Atlantic News Agency

Uruguay rejects Zamin Ferrous mining project environment impact report

Jorge Rucks: “Objections were formal substantial”

Uruguay made a long list of objections to the environment impact assessment study presented by the Aratiri mining project which plans open-pit extraction of magnetite (ferrous component) from vast resources in Valentines, the heart of the South American country.

“The objections were both formal and ‘substantial’” according to Jorge Rucks head of Uruguay’s National Environment Department, who revealed that a special team with technicians from his office but also from the territorial ordinance department and the water resources office had been created to address the Aratiri project.

Under Uruguayan law the interested party, in this case Zamin Ferrous, must present an environmental impact study and a socio-economic impact report which is quite complicated since the area under exploration covers five regional governments in agriculture areas, which is famous for high quality rice and livestock.

Furthermore the project has different areas: the open pit mining district; a 212 kilometre slurry iron-ore pipeline to the coast and a port, “which means different kinds of impact in each area”.

“The report is lacking formally since it does not follow procedures clearly established and the road-map for the presentation of such environment impact assessment documents. Besides, in some aspects of the assessment it is vague and too general which makes it impossible to follow detailed base-line checking. So we have asked them to look deeper into the report”, said Rucks.

He added that the Aratari project people accepted the observations and requested the report be put on a shelf “since they had collected additional information and would be elaborating a more complete version”.

The Aratari project belongs to Zamin Ferrous registered in Jersey with offices in London, Sao Paulo, Uruguay and Switzerland and is believed to be closely linked to the Indian Mittal family group that has interests in steel making, pulp, real estate and other enterprises in Asia. The Mittal family is among the short list of the richest in India.

According to the Zamin Ferrous website: “Valentines project is the proposed development of a major greenfield magnetite mining, processing and exporting facility in Uruguay; subsidiary companies, 100% owned by Zamin Ferrous, hold or have in application Prospecting, Exploration and Mining Licences covering around 120,000 ha of land. The licence area is approximately 250km from both the coast and Montevideo. A Definitive Feasibility Study is currently underway and due for completion by the end of Q2 2011”.

The Aratari project has triggered strong reaction among farmers in the area who fear their land will be spoilt by the open-pit exploratory prospecting of the company and the 212 kilometre long pipeline. The port is also objected because it is prime Atlantic coastline with a booming tourism industry.

However the administration of President Jose Mujica is fully supportive of the project which allegedly plans to invest 2.8 billion US dollars in its development plus generating thousands of jobs.

President Mujica’s enthusiasm seems to be behind a report “Myths and errors of the Aratari Mining Project” which was distributed originally among cabinet ministers and later released, but which does not identify its origin or credit. This has triggered demands from lawmakers requesting the Executive to establish the origin of the document and why President Mujica was distributing it.

Zamin Ferrous in a recent presentation in Montevideo replied to what it considers the eleven most common questions about the project, indicating that the area to be explored is only 14.000 hectares (not 120.000); annual production, 18 million tons of iron ore; no chemical processing, just triturating and magnetic selection; open pit mining is allowed in the EU; water demanded will be equivalent to 90 hectares of rice; added value, low; impact of the pipeline is the same as a gas pipeline; farming and mining live together in other areas of Uruguay; number of direct jobs 1.500 and 15.000 indirect and finally the return of the operation for Uruguay, 400 million USD annually.