Orosur Is Still Blazing The CSR Trail In Uruguay

Thursday, 15 January, 2015

“Our relationships with communities and with landowners have never been a problem”, Ignacio Salazar says, over a crackly phone line.

It’s a significant statement to make, because as chief executive of Orosur Mining, he’s speaking as the head of the only producing mining company in Uruguay.

That unique position has brought its share of difficulties, as Orosur has more than once had to blaze a legislative or permitting trail that in most other countries would have been well-trodden for junior miners. Thus, moving plans and permissions through the corridors of power can take time.

But it also has its advantages. As the trail blazer and the country’s only serious producer of minerals, Orosur has the kind of access to ministers that some junior miners can only dream of.

And, more locally, operating in a country which has no significant history of mining means that the company has experienced none of the pushback that miners can experience elsewhere.

In Uruguay there are no legacy environmental issues left by other miners, and no long-standing festering social issues either. Not for Orosur the anti-mining activism that characterises much of Eastern Europe or the explosive labour issues of South Africa.

On the contrary, Orosur started with the proverbial blank sheet of paper and has been allowed to write the book on community relations from the get-go. And to write it in terms of 21st century standards.

And so, when it started mining gold from an open pit at the San Gregorio project in north eastern Uruguay more than ten years ago it had everything to gain - and much to lose too – in how it handled community relations.

During the course of that time the company has diverted a river and built a second tailings dam, both of which projects could have had serious repercussions if not handled correctly. But Orosur engaged the locals actively and seriously from the start, and the projects were completed without fuss.

“The local groups and the environmental department are very happy with the way we handled that”, says Ignacio. “We have no choice but to be very active.”

It’s an approach which has gleaned high level support. José Mujica, the President of Uruguay commented recently in the context of a general discussion of mining that Orosur has set a great example that other companies looking to enter Uruguay would do well to follow.

The thinking was that he was referring to London-based, Indian-backed Zamin, which has a huge iron ore project in the north of the country that it’s looking to develop, under the right circumstances.

But be that as it may, the valedictory comments he made regarding Orosur were most illuminating. The company had, he said, a perfect environmental record. It pays better salaries than anybody else. And, most crucially, there has never been a problem with the communities or with landowners.

Bear in mind that Mr Mujica was once a senior member of a militant left-wing guerrilla group, so this is not a man that’s necessarily ideologically minded to put his weight behind a mining company supported by Western capital.

That he does so is surely, at least in part, a testament to the power of CSR.