Chile mine and port project nears approval despite scientific opposition

In February 2017, investigative reporting revealed that the Dominga mining and port project in northern Chile was influenced by former president Sebastián Piñera’s personal business ties, and a complex web of conflicts of interest began to unravel. Suspicions arose of ties to corruption as well as irregularities in the environmental assessment process. (Piñera was elected president again soon after, taking office in March this year.)

Because of the contentious political atmosphere surrounding it, the Dominga mining and port project has found itself in the headlines repeatedly. As a result, its technical and environmental aspects have been pushed into the background.

Both the project’s detractors and defenders charge that there have been political pressures and illegalities in the environmental assessment process, so the central question remains: could the Dominga project harm an area with some of the highest marine biodiversity in the world?

The view from up high

If Dominga is completed, 12 million tons of iron will be extracted from the earth annually, plus another 150,000 tons of copper concentrate for the next quarter century. In addition to ore extraction, Dominga would process and ship the iron concentrate from its own port. Three to four ships per month would transport the ore from the port to the Asian market for sale.

The initial investment for all this is assessed at $2.5 billion dollars and promises to generate 10,000 jobs during construction, and 1,450 permanent positions once the project is in operation. These are attractive numbers in the community of La Higuera, in the region of Coquimbo, which has one of the highest rates of unemployment in Chile. The “Norte Chico,” or “Near North,” as it’s called, is the gateway to the Atacama Desert, the driest in the world.

Thirty-five kilometers (22 miles) north of what would be the Dominga port is a region with some of the highest marine biodiversity in the world. Protected by the Humboldt Penguin National Reserve and the Chañaral Island and the Choros and Damas Islands Marine Reserves, these areas form part of the greater Humboldt Archipelago, which runs from Punto Poroto in the south to Punta Pájaros in the north.

This area has been a conservation priority site for years due to the oceanographic phenomenon of upwelling, the process by which deep, cold, nutrient-rich water rises to the surface, fertilizing it. Extraordinary biodiversity results as species from up and down the food chain arrive to feed. Krill and anchovies, essential to the diets of the marine mammals and birds protected in the reserves, abound in this area. The bounty also sustains the most productive artisanal fisheries of the central and northern regions of Chile.

Up to 560 marine species can be found here, including 187 species of seaweeds and invertebrates, 122 bird species, 21 marine mammal species, and 68 fish species. Of the birds and mammals, 50 percent are classified as vulnerable or endangered on the International Union for Conservation of Nature’s (IUCN) Red List of Threatened Species. The Humboldt penguin is among the vulnerable species, and the reserve that carries its name is home to 80 percent of its entire global population. The only residential colony of bottlenose dolphins in Chile also inhabits this coastal area, along with sea otters and the Peruvian diving petrel, both listed as vulnerable.

Recent research by local scientists at the Catholic University of the North, in the city of Antofagasta, shows that 14 species of cetaceans are found in the Coquimbo Bay system. In December, when summer begins in the Southern Hemisphere, the whales travel their annual migration route from south to north. Here, off Choros and Damas islands, they stop to rest before continuing their journey to the tropical waters where they will breed.

The thin baseline

Chilean law requires that environmental impact studies for major projects establish a baseline or area of influence to be evaluated by the Environmental Assessment Service (SEA), that is, “the geographic and territorial extension of each one of the environmental components that could potentially be affected by the project.”

Andes Iron SpA, the parent company of Minera Dominga, submitted its study to the SEA in 2013. According to the company and the bibliography it compiled, the marine baseline encompassed Totoralillo Norte Bay, the would-be site of the Dominga port, and identified “no areas under official protection or priority sites.”­

The response from both the National Fisheries Service (SERNAPESCA) and National Forest Corporation (CONAF), the two agencies responsible for administering the country’s protected areas, was that the baseline underestimated the project’s impacts. SERNAPESCA requested that the area of influence include the Choros and Damas Islands Marine Reserve and the Humboldt Penguin National Reserve. CONAF confirmed this opinion, saying the characteristics of the marine currents in this location and the feeding behaviors of the fauna living in the conservation areas meant Dominga would inevitably impact the reserves.

As early as 2004, the scientific community had begun to argue for effectively protecting the Humboldt Archipelago through a decree. Since then, the Dominga project advanced and was unanimously approved by the Chilean cabinet in 2017, while the decree to protect the archipelago never came.

The reason for protecting the Humboldt Penguin, Chañaral Island, and Choros and Damas Islands reserves is that all of the animals that live on these islands do not feed there, said Carlos Gaymer, a marine conservation scientist. Rather, their main feeding area is Totoralillo Norte, Chungungo and the entire coastal area from Caleta de Hornos to Punta de Choros.

Gaymer is the regional coordinator of the IUCN’s World Commission on Protected Areas (WCPA) for the southeastern Pacific, and a researcher for the Ecology and Sustainable Management of Oceanic Islands (ESMOI) of the Center of Advanced Studies in Arid Zones (CEAZA). He says that, paradoxically, “the feeding areas of the species being protected by the reserve are not protected themselves. It makes no sense to protect their nesting areas without protecting their feeding areas.”

As the conservation plan for the Humboldt penguin states, “the degradation of feeding areas is the primary threat in terms of scope, severity, and irreversibility.” For this reason, after the protective decree remained “pending” last year, in June of this year, 200 marine scientists sent an open letter to President Piñera, requesting that he sign it and, finally, provide effective protection to this coastal area. With this in mind, CONAF and SERNAPESCA requested that the company include the reserves within the area of influence.

However, according to the environmental impact study for Dominga submitted by the company, scientific research indicates that the Humboldt penguin and the Peruvian diving petrel “establish feeding areas in a radius of five kilometers [3 miles] around nesting sites.” This claim is contrary to the studies cited by Gaymer, which state that the birds travel up to 40 kilometers, or 25 miles, in search of food — food that they find mainly in the area where the Dominga port will be built. Upon reading this in the company’s study, CONAF responded emphatically, maintaining that the company had cherry-picked the data in its submission.

“When the company arrived in the region, the first thing they did was meet with the scientists who have spent decades working in the area,” Gaymer told Mongabay Latam. “We contributed all available information so that they would have the best for conducting their studies. Well, we saw clearly in this process that the scientific information that had been produced and published did not suit the company. It contradicted what they were interested in sharing in their environmental impact study.”

Mongabay Latam contacted Andes Iron SpA for comment, but did not receive a response by the time this story was published.

CONAF alone in the battle

Other reasons detailed in more than 10,000 pages of the assessment document made CONAF insist that the project’s baseline include the reserves. Excluding them “entails the absence of essential information, preventing an analysis of the project.” Without adequate information, no remediation, mitigation or compensation plans could take on the true scope of the project, the agency said.

In January 2016, one of project’s biggest critics abandoned the fight: SERNAPESCA, the fisheries agency. In response to a second addendum submitted by Andes Iron, it gave up on including the protected areas in the project’s baseline. Up to that point, SERNAPESCA’s comments had been signed by Jaime Molina, the regional director. However, on this occasion, it was the acting regional director and now current regional director, Cristian López, who signed.

Mongabay Latam accessed information from the SERNAPESCA regional office in Coquimbo confirming that the agency’s initial report regarding the second addendum did mention the need to integrate the reserves into the baseline. It was at the agency headquarters in Valparaíso that SERNAPESCA decided to remove that point.

When asked about the reasons for omitting the comment, the headquarters indicated to Mongabay Latam that “after viewing the background information contributed by the company … it arrived at the conclusion that the initial aim to expand the area of influence to the Humboldt Penguin National Reserve and the Choros and Damas Islands Marine Reserve was not justified.”

Nevertheless, the evidence obtained by Mongabay Latam confirms that the explanation offered by the headquarters to the regional office had nothing to do with any technical or scientific aspect. The reason for removing the requirement to include the reserves within the area of influence was that the regional office had made this comment under the incorrect section of the report. By decree, according to the Valparaíso headquarters, comments regarding “the description of the area of influence should be made within the section ‘Description of the Project,’ but in our regional office’s report the requirement was set out in a different section.” The comment by the SERNAPESCA office in Coquimbo was thus removed and CONAF stood alone in the battle.

Mongabay Latam reviewed the cited decree and confirmed that there is no mention of the specification indicated by the agency headquarters. Furthermore, it clearly states that the area of influence and the project description are distinct sections. Therefore, the request to add the reserves to the baseline should not have been removed, or at least not with the reasoning provided.

Sergio Cortés, leader of the Association of Civil Servants of SERNAPESCA, said the scientific opinion in the region had not changed. After the scientists saw their opinions silenced, the association attempted to make a statement in support of its colleagues’ work. However, nothing came of the effort and no official document accounting for what had happened was published. Cortés said this was because SERNAPESCA is a centralized agency. That is, all the regional offices are governed by the headquarters and, as such, cannot object to the latter’s decisions.

Cruz Grande and the winning card

A year earlier, in January 2015, an environmental impact study had been approved for another port, just 5 kilometers from Dominga. The port of Cruz Grande belongs to Compañía de Acero del Pacífico (CAP), the main iron mining and steel production group in Chile. Each year, the port is expected to ship 13.5 million tons of ore and see 75 cargo ships pass through, 1.5 million more tons of material and 30 more vessels than Dominga would.

The good news for Andes Iron was that this project, located even closer to the Humboldt Penguin National Reserve than Dominga, had been approved, even though its baseline did not take the protected areas into consideration.

Not only are both projects similar in their activities, capacities and geographic proximity, but it is also possible to find comments in the documents from Cruz Grande’s evaluation process that are practically identical to those Dominga received.

But the difference is that in its response to the addendum submitted by Compañía de Acero del Pacífico to its environmental impact study, SERNAPESCA indicated that “the holder excludes the legally protected areas of the Choros and Damas Islands Marine Reserve and the Humboldt Penguin National Reserve from its area of influence as these are 30 kilometers away … this cannot be used as a technical argument without first assessing the possible risks associated with port activity.”

According to CAP, there was no way the project and the magnitude of its activities would reach the reserves. “The impacts identified are confined to a limited area, which can in no way lead to a decline in the habitat available to these species, nor their varied food resources,” it said.

Nevertheless, SERNAPESCA stood firm and reiterated its objection in the next addendum submitted by the company. CONAF also lent its support, arguing the same reasons it did in the case of the Dominga project.

SERNAPESCA’s stand lasted longer than in the Dominga case, but it too finally collapsed when it had to respond to the third addendum submitted by Compañía de Acero del Pacífico. Those who had followed its defense of the reserves were surprised. After categorically defending the need to include the protected marine areas in the baseline, the agency gave up.

As in the case of Dominga, that last document was signed by Cristian López. The Cruz Grande project was finally approved by the Assessment Commission despite the opposition from CONAF, and Dominga found the card it needed to win the game.

Fourth time’s the charm

With Cruz Grande as a precedent, Dominga prepared its third addendum to respond to its evaluators’ requests. It decided to accept the request to expand its area of influence, keeping in mind what had been approved for Compañía de Acero del Pacífico. The new baseline included ship navigation areas but once again omitted the protected areas. If Cruz Grande were considered a homologous project, with even greater maritime traffic and cargos of ore, there was no reason that what had been accepted for that port would not be accepted for Dominga.

In November 2016, the third addendum from Andes Iron arrived and the evaluating agencies made their comments. CONAF insisted, this time alone, on its main argument: the incorrect delimitation of the baseline. The agencies were informed that this was supposedly the last addendum.

However, two months later, a fourth report appeared containing points for clarification, meaning that Andes Iron would submit a fourth addendum. The report had been redacted, in contrast to the previous ones, by the headquarters of the Environmental Assessment Service, or SEA, in Santiago, and it completely dismissed CONAF’s competence to discuss biological resources. Just like that, the chapter on including the reserves within the project’s baseline was closed.

In February 2017, the SEA published the consolidated environmental assessment report, recommending that the Assessment Commission, the next evaluating agency, approve the project.

An unexpected twist

Against expectations, the Assessment Commission and then the Council of Ministers for Sustainability rejected the Dominga mining and port project, despite the SEA’s recommendation to approve it.

The company then turned to the Environmental Court, charging that the decision to reject the project was arbitrary and illegal given that “we have a baseline that was the same as the one accepted for the Cruz Grande project.” For the company, the reason for the arbitrariness was that a few days before the SEA gave it the go-ahead, the press had uncovered that then ex-president Piñera had businesses associated with Dominga. The company claimed that the grounds for rejecting the project were connected to partisanship and not to the technical grounds that, according to the SEA’s decision, demonstrated the environmental viability of Dominga.

It was at that time that the regional SEA of Coquimbo reported that it had been pressured by Santiago to recommend the project’s approval. An internal inquiry was opened to investigate the case. The accusations centered on the appearance of the fourth report, which dismissed CONAF’s competence and gave the company the opportunity to submit a fourth addendum. According to the declarations that appear in the inquiry, the report had been sent to Coquimbo with the order to publish it without making any changes or comments.

After the investigation, the Environmental Assessment Service deemed that there was no reason to believe there had been irregularities in the process and closed the inquiry. However, the investigation never called officials from the SERNAPESCA office in Coquimbo to testify. CONAF officials were not called to testify either.

In April 2018, the Environmental Court ruled in favor of Andes Iron, but the project is currently before the Supreme Court after the NGO Oceana lodged an appeal for a reversal to invalidate the Environmental Court’s ruling.

“The Environmental Court’s decision did not rule upon the heart of the matter, that is, the technical aspects of the project,” said Liesbeth van der Meer, director of Oceana Chile. “It said nothing about whether or not it is viable environmentally.”

The court’s could take until the end of 2018 to reach a decision in the case.

In recent years, the proportion of Chile’s marine areas with some degree of protection has gone from 4.4 percent to 42 percent. Today the country is a world leader in marine conservation. However, the fact that the environmental assessment process leaves out scientific opinion raises doubts as to the weight given to science in decisions involving marine conservation.

This story was reported by Mongabay’s Latin America (Latam) team and was first published here in Spanish at the Latam site on Aug. 2, 2018.

Banner image © Eduardo Sorensen/Oceana.