Costa Rica’s presidency announced Monday that an international tribunal had ruled in its favor in the conflict it has been waging against Canadian mining company Infinito Gold since the cancellation in 2010 of a gold concession for environmental reasons.
“The Government of the Republic is pleased to inform the country that Costa Rica has emerged victorious from the proceedings initiated by Infinito Gold” which was claiming “394.8 million US dollars plus interest,” the presidency said in a statement.
The company had taken the matter to the International Centre for Settlement of Investment Disputes (ICSID), a World Bank organisation based in Washington.
Infinito Gold was demanding nearly $400 million in compensation from Costa Rica for the cancellation of a mining project in Crucitas de San Carlos, about 200 km north of San José, on the border with Nicaragua.
“The arbitral tribunal concluded that the payment of damages to Infinito Gold Ltda was not appropriate,” the presidency noted.
In 2010, the Costa Rican Congress banned the exploitation of an open-pit mine in Crucitas, after the Costa Rican courts annulled the exploitation contract previously obtained by Infinito Gold.
“Since that date, illegal miners, mostly of Nicaraguan nationality, have been extracting gold from this area, without having the corresponding environmental permits,” the presidency stressed.
According to environmental groups, they have caused serious damage to the soil and rivers in the area.
Illegal miners extract metals from the deposit and treat them with chemicals (mercury or cyanide).
From Tuesday, a “special police operation” will be carried out in the area under police surveillance for “illegal looting, clashes and the sale of gold.”
Industrias Infinito, a subsidiary of Infinito Gold, had obtained in 2008 from President Oscar Arias (2006-2010) a concession to exploit 261 hectares in Crucitas, of which 191 were primary forest – the last in the country – which would have been cut down.
But in 2010, after intense mobilisation by environmentalists and politicians, a court ruling ordered the government to cancel the concession, citing harmful environmental consequences and irregularities in the granting of operating permits.
The project involved extracting one million grams of gold, worth about two billion dollars.
In early June, the ICSID ruled in favour of Colombia against the Canadian mining company Montauk Metals, which was claiming 180 million dollars for having expropriated a gold mining area.