By Patricia Nieto Mariño
La Higuera, Chile, Oct 6 (EFE).- The Dominga mining project in northern Chile exists only on paper, with no trucks, tailings or cranes to be found at that site tucked amid hills in the Coquimbo region, roughly 500 kilometers (310 miles) from Santiago.
Even so, it has led to Chilean President Sebastian Piñera’s being named in the Pandora Papers (a vast trove of nearly 12 million leaked tax-haven files that reveal how powerful people shield their wealth) and facing questions about his business dealings.
The mine project promises to be a significant operation, even in a country that is the world’s largest copper producer, with Chilean mining company Andes Iron estimating a $2.5 billion investment will be required to extract iron ore and copper reserves over a period of 22 years.
But in addition to a decade-long environmental controversy swirling around Dominga due to its proximity to a unique nature reserve, the project now finds itself under enhanced scrutiny due to Pandora Paper revelations about its purported sale in the British Virgin Islands by the Piñera family.
The International Consortium of Investigative Journalists, a Washington DC-centered network of journalists that obtained the Pandora Papers and has reported on them in collaboration with 150 media partners, revealed that the Piñeras had been the main shareholders in Minera Dominga, the Andes Iron subsidiary that owns the project, until 2010.
That year, the company was sold to a businessman and friend of the current president for $152 million, $138 million of which was negotiated in the BVI, a well-known tax haven.
An investigation led in Chile by the Ciper-LaBot journalistic alliance revealed a controversial clause in the sales contract that made the final payment conditional on an environmental protection area not being established at the mine site.
Besides two open-pit mines, the project contemplates the construction of a cargo port located 30 km from a national reserve that is home to 80 percent of the country’s Humboldt penguins, a species that hundreds of scientists worldwide have spent years trying to preserve.
“The investigation has generated a lot of suspicion about the project’s environmental evaluation process,” Liesbeth van der Meer, director of Oceana, a non-governmental organization dedicated to protecting the oceans, told Efe.
Carlos Gaymer, an academic at Chile’s Catholic University of the North, told Efe that the Coquimbo Bay system is a “natural treasure” and that alterations of that ecosystem could lead to the large-scale death of birds, penguins and whales that rest and feed there.
“Building a mine here would be like doing it on the Galapagos Islands. It’s one of the world’s 92 biodiversity hotspots,” he added.
The Dominga project was rejected by an environmental commission in 2017 during then-President Michelle Bachelet’s administration, but after Andes Iron appealed the decision it was approved in August by a 12-person panel made up almost entirely of Piñera nominees.
“The permit was granted to a project whose investor was an ex-partner and friend of the president’s. There was a clear conflict of interest,” Matias Asun, Greenpeace Chile’s director, said.
In 2010, the same year in which the ICIJ says the sales contract for the Dominga project was signed, Piñera (then serving his first presidential term) hailed the cancellation of a thermoelectric plant to be built by Franco-Belgian company Suez in that same region and touted that move as an environmental milestone.
Ramon Ovalle, an elderly man who runs a tourist business on Chile’s northern coast, told Efe he was present when the announcement about the Suez plant was made.
“He came here and promised us he wasn’t going to install a thermoelectric plant to protect wildlife, but now you don’t believe anything he says.”
Piñera, who will finish his second term in March 2022 and is one of Chile’s wealthiest individuals, said Monday that “there is no conflict of interest” and that before assuming his first presidency he had completely detached himself from the management of family businesses and any other company in which he had previously participated.
The matter “was already investigated by the public prosecutor’s office and resolved by the courts in 2017,” said the president, who is facing new calls for his impeachment over the Pandora Papers revelations.
The center-right president survived a similar attempt two years ago over his handling of anti-government protests.