Skye Resources and Nickel Mining in Guatemala

El Estor, Guatemala

Time in El Estor, Guatemala

We found it very difficult to write about the nickel mine in Guatemala, primarily because we don't classify ourselves as journalists. Our goal was to dig into the Fenix project and present the reader with facts beyond those some NGO's (non governmental organizations) were spreading across the internet. What we discovered, no matter where our research led us, was it is hard to step into the middle of a mud fight, without getting dirty.

If we were to attempt to define the fight over the nickel mine in Guatemala in one phrase, it would be a fight between a poor and indigenous local population, and a government that is trying to earn the trust of its people, after years of brutality and genocide. The historical facts are clear, and undeniable. The indigenous Mayan population of Guatemala have faced many years of oppression, and according to the United Nations, outright genocide. During the 70's and 80's, thanks mainly to a 1954 CIA backed overthrow of a popularly elected government (we would call it a Leftist government today, but back then some loosely used the term "Communism" to define anything endangering big business interests in foreign countries.), thousands of Mayan's" disappeared". It was not until 1996 that a UN backed peace agreement was brokered, that ended a 36 year civil war.

(To view the Canadian documentary "A Coup: Made In America", youtube has the show broke up into 5 segments.
#1 #2 #3 #4 #5)

The legality - The primary argument of those opposing the Fenix Project, is the government did not have the right to grant Skye Resources exploration and mining leases on Mayan land. They claim the United Nations Office of the High Commission on Human Rights "Convention 169 Concerning Indigenous and Tribal Peoples in Independent Countries" has been violated by the Guatemala government. The law, states in Article 14 1. The rights of ownership and possession of the peoples concerned over the lands which they traditionally occupy shall be recognised. In addition, measures shall be taken in appropriate cases to safeguard the right of the peoples concerned to use lands not exclusively occupied by them, but to which they have traditionally had access for their subsistence and traditional activities. Particular attention shall be paid to the situation of nomadic peoples and shifting cultivators in this respect. 2. Governments shall take steps as necessary to identify the lands which the peoples concerned traditionally occupy, and to guarantee effective protection of their rights of ownership and possession. 3. Adequate procedures shall be established within the national legal system to resolve land claims by the peoples concerned." Guatemala is not the only government that must wrestle with this broadly defined regulation. The broad decree of this regulation, has become a nightmare to many countries. Under its auspices, it would be difficult to find inhabited land, on any continent, that could not be loosely defined as being occupied by "indigenous" people. The problems arise when a government must apply the intent of the law, to the practicality of the situation.

Who has the rights to the land now occupied by Skye Resources and its Guatemalan subsidiary, Compañía Guatemalteca de Níquel? If we believe the NGO's, then the Mayan's hold full claim to this land, and therefore the presence of the current mine, is illegal. But if we go back to the HRC 169, listed above, Article 15 addresses this very problem. "1. The rights of the peoples concerned to the natural resources pertaining to their lands shall be specially safeguarded. These rights include the right of these peoples to participate in the use, management and conservation of these resources. 2. In cases in which the State retains the ownership of mineral or sub-surface resources or rights to other resources pertaining to lands, governments shall establish or maintain procedures through which they shall consult these peoples, with a view to ascertaining whether and to what degree their interests would be prejudiced, before undertaking or permitting any programmes for the exploration or exploitation of such resources pertaining to their lands. The peoples concerned shall wherever possible participate in the benefits of such activities, and shall receive fair compensation for any damages which they may sustain as a result of such activities." The United Nations itself, while protecting the rights of indigenous people to their lands, recognized a nation's sovereign right to the mineral resources that might fall within those boundaries. This provision, thus legalizes the right of the Guatemala government, to grant Skye Resources the necessary permits to explore for nickel within its borders, no matter how much the NGO's want to argue semantics over words like "before" and "until".

The history - It is without question that the video that we, among others, have linked to, is shocking. In a world where home ownership is the single most important possession an individual can hope to attain, watching poor people being forced from their "huts", and having them burned in front of them, is disturbing. (video here) In this, the actions of the representatives of Compañía Guatemalteca de Níquel, did nothing but highlight the level of disregard for human dignity, that still exists in Guatemala. While activists will try to justify the land occupation by Mayan settlers, the legal authority in Guatemala deemed it contrary to the law, and therefore the evictions were carried out within the framework of the law. The overwhelming show of force, while looking sinister on video, did ensure these evictions were more peaceful than prior evictions have gone. (Although Mining Watch in Canada stated "The “reoccupiers” were violently removed by Guatemalan police and military in early January, 2007.") And if the dwelling places looked temporary, they had only been built last fall.  However, whether one supports the Mayan cause, or the mining company, the people being evicted deserved a greater level of respect. Skye must look beyond what is happening to its company today and understand why history has placed them in the situation and circumstance they are currently in.

In 1955, one year after the overthrow of the government, Hanna Mining Company discovered extensive nickel reserves in the the hills near El Estor, Guatemala. Five years later, Exploraciones and Exploraciones Mineras Izabal, S.A. (80% owned by Inco, 20% by Hanna) was born and in 1965, they were granted a 40 year mining concession on 365 square kilometers (90,000+ acres). While outright civil war had yet to break out in Guatemala, there were those that were opposed to the mine from the beginning. Many intellectuals and politicians in opposition to the new government, felt the contract was nothing more than a "give away" of the nation’s mineral reserves, for the personal profit of its new leaders. These people had just seen a popular government, that had promised to return much of the land, held by wealthy overseas companies, back to the people, and now they were seeing the new government make changes that would give more land away to foreign control. As opposition to the new military government grew, EXIMBAL (Exploraciones and Exploraciones Mineras Izabal, S.A.) became one of the lightning rods for the confrontation. Two of those comprising "an investigative commission on the contract of the State with company EXIMBAL", were University of San Carlos law professor Julio Camey Herrera, and law professor and congressional deputy Adolfo Mijangos López. Both were gunned down, the latter on a busy street, while seating in his wheelchair. A third member of the commission, law professor Alfonso Bauer Paiz, was shot and survived. One month later, the new government signed an exploitation agreement with EXIMBAL, allowing for the mining and extraction of nickel ore. The mine operated until 1982, when the price of nickel forced the closure of the operation. Inco maintained the facility until 2004, when Skye Resources purchased a 70% interest in the project from them and named it the Fenix Project. (According to the Skye website "On December 13, 2004, the Government of Guatemala issued new exploration licenses to CGN covering the Fenix project to replace CGN’s Niquegua exploitation concession (originally granted in 1965 for an initial 40 year term) and two smaller concessions granted in 1974. The new licenses (called Niquegua Norte and Montufar II) are for an initial three-year period and they are renewable on application for up to two additional periods of two years each. Upon approval of an environmental impact study by MARN, the licenses would, subject to the filing of an application and receipt of approval from the Guatemalan Ministry of Energy and Mines (MEM), be converted into exploitation licenses that would have a 25 year term, with a right of renewal for an additional 25 year period." Exploraciones y Exploraciones Mineras Izabal S.A.(EXIMBAL) has since become Compañía Guatemalteca de Níquel, S.A.)

The moral right - So if Skye has rights to over 90,000 acres, why not give some land to these people? Skye will tell you that they have. If you listen to the woman in the video, she hasn't been offered. According to, "The Q’eqchi’ (Mayan) people, who live throughout the municipal jurisdiction of El Estor’s 3000 square kilometers, make up approximately 90% of the 40,000 inhabitants of El Estor, and survive mainly as subsistence farmers and fisherman". On the same page, they advise 365 square kilometer's were leased to EXMIBAL. (Square Kilometer = .3861 Square Mile = 100 Hectares = 247.1 Acres). Therefore, of the nearly 3/4 million acres occupied by the Q’eqchi’ Mayan's, Skye has exploration/mining rights to 12% of the area. (A comparison would be the state of Rhode Island in the United States . With 776,957 acres or 3,144 square kilometers, it has a population of a little over 1 million people.)

What Skye faces in Guatemala is similar, but different than what other mining companies are facing in other indigenous areas of the world, due almost entirely on the total mistrust of the local population towards their government. Change is not immediately welcome, especially when it potentially disrupts the world as one has come to know it. This dilemma is faced daily, by rich, and poor nations alike, as the requirements of a growing worldwide population requires expansion. Environmental changes are an ever present concern, and while mining companies have made huge strides in "cleaning up their act", they are burdened with a history of scarred landscapes and ecological disasters. Every human alive needs the basics to survive - shelter, food and water. Threaten any of these, and you are asking for a fight. Mines inevitably bring many changes to a remote community. Where poverty once reigned, new sources of wealth are introduced. Wealth brings good, and bad, to a community not used to having it. On the positive side, steady employement offers an escape from the perils and uncertainty of "living off the land". It often introduces modern technology into remote area's. On the negative, wealth brings a greater void between the have's and the have not's. Prostitution, as well as other crimes, may be introduced into a society. Change comes with uncertainty, and every human experience's some level of it in their lives. For the indigenous, this change can be a great shock to a way of life as they have always known it.

The brutality the Mayan's have witnessed in Guatemala isn't something they have to read out of books. Most of them are old enough to have experienced this brutality first hand. Not far from El Estor is the town of Panzós, where one of the landmark events of the Guatemalan civil war occurred in 1978, when over one hundred men, women and children were gunned down by the Guatemalan Army. They don't trust the government, and it will take years for the government to earn their trust. They don't trust foreign governments, especially the United States, whom they saw overthrow the government they elected and then foster the brutality during much of the last half century. Like many in South and Central America, the country's poor appear ripe to elect a populous Leftist presidential candidate in the near future. After what happened in Bolivia recently, with the seizure of the Swiss owned tin smelter and mine, this future would appear potentially threatening to any mining operations in the country.

Final "personal" opinion - Skye Resources is not responsible for the history in the El Estor area of Guatemala. But it is playing an important part in its future. Our recommendations -

#1 Separate yourself as much as possible from the negative history in the area. This would include the immediate termination of any member of Compañía Guatemalteca de Níquel, S.A, that has been accused of taking part in any violence against the general populace during the EXIMBAL years. You were not responsible for the brutality of the past, but you can help heal the wounds.
#2 Do not take part in the local custom of bringing in outsiders to support ones cause. This increases animosity between the population, and while generally accepted as the way things are done in Guatemala politics, we encourage you to take no part in it.
#3 Continue to reach out to the general populace. These people have no reason to trust you, and don't. Understand their culture, foster it, respect it. It's a slow process but your ultimate goal as a business should be to give the long term shareholder a return on his investment. Your long term success, will hinge on the acceptance, however guarded, of the majority of the local populace.
#4 Train those in your employment, or employees of your sub-contractors, of the sensitivity of the situation. Not sure who's bright idea it was to set fire to those huts, but hopefully they aren't in a position to repeat this mistake. This was a serious blunder, and not only brought back the brutality of the past to the Mayan's, but also gave fodder to those NGO's who are sworn enemies to mining operations worldwide. You may have had the legal right to what you did, but in the way it was handled, you lost the moral high ground. If your employees in Guatemala continue to think that things must remain the way they have been, then you must make personnel changes and bring with your new company, a fresh perspective. There are those in Guatemala that are trying to convince the people, and the world, that you represent the "Big-Bad-Wolf". Don't give them any reason to be right.
#5 Speaking of public relations, what are you doing for the Mayan's? (video here) The NGO's are showing us what you are doing "to" the indigenous population, why aren't you showing us what you are doing "for" these same people? If the recent debacle hasn't proven anything else, it should make clear to all mining companies the power of the visual media. (To give you an example, which of these has got people talking - this or this.)

And finally, we would like to leave our readers with a quote. This is written by Victoria L. Henderson. a student with the Department of Geography Queen's University Kingston, ON (Canada) and posted on a few NGO website's. It is a reply to Ian Austin of Skye Resources. "I respectfully submit that your understanding of Maya cosmovisión fails to appreciate the deep spirituality that links Maya peoples to the Earth. I have visited Cerro 400 and you are correct in stating that, had I not been told, I would never have known that the area had been mined and reforested. I, however, am not Maya. The idea that the earth can be gutted and covered over "as if nothing had happened" is wholly inconsistent with Maya cosmovisión. Pointing out how "natural" a site may look after it has been mined is to confound the deeply spiritual with the highly superficial."

How could anyone possibly argue with that logic??

One final point - obviously, while we attempt to be objective on this site, we could be accussed of having our opinions tainted by our following of the mining industry. When reading about the events in El Estor and Skye Resources, carefully consider the source. Most of the articles being written about Skye in Guatemala, or the eye-witness accounts they are quoting, are being written by a handful of individuals, that a quick check on the internet reveals, are either completely anti-mining, or have spent their life working for anti-establishment "causes". - "Today, El Estor is a little gem of a town because of the municipal improvements made by the Nickel Company of Canada. Throughout the 1960s and 70s, the nickel company constructed a nickel mine and refinery about a kilometer from El Estor. In exchange for permission to operate, the nickel company agreed to invest in improving the town of El Estor. El Estor is now paved with wide and clean streets, the electrical grid is new as is the telephone system. The nickel mine was unsuccessful and the plant is now closed. Today, El Estor is a clean and beautiful albeit quiet town where nothing much ever happens."

Sources and research

Numerous others not listed

The author of this article declares he does not hold shares in any mining company, including the ones mentioned in the article above. And the author of this article freely admits he did not stay in a Holiday Inn Express last night, and therefore must bear the consequences of his own opinions.

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