The owner of one of Colombia’s largest gold mines is currently facing a battle on two fronts. Underground, Zijin Continental Gold is fighting informal miners who have been illegally extracting gold from within its concession, while in international courts, the Chinese firm is suing the Colombian state over an alleged lack of security guarantees for its operations in the country.
How these battles will play out remains to be seen. The outcome of the conflicts with informal miners could hinge on whether Colombia’s legislature approves President Gustavo Petro’s proposals to modify the country’s current mining code, in place since 2001. Since taking power in 2022, Petro’s government has promoted reforms that would increase the state’s involvement in mining, and prioritise the concerns of small-scale miners over large multinational corporations, including seeking greater formalisation within the sector.
Meanwhile, Zijin’s court case will rest on resolution at the International Centre for Settlement of Investment Disputes (ICSID), an arbitration court in the United States, which has only just begun, and the outcome of which could take years to decide.
Violence and attacks
Tension is constant in Buriticá, the municipality in Antioquia department, north-western Colombia, where the Zijin mine is located. Buriticá made headlines in May after a violent blockade by informal miners on the main road through the municipality – the only one which leads north to ports in the Gulf of Urabá. The blockade initially took place to demand the rescue of two informal miners who had been trapped in the mine.
At the end of the month, community representatives shared a letter, publicised by Zijin, demanding state intervention to end the blockade, as it led to the disruption of food and health supplies, as well as free movement in the area.
Many informal miners in the area work under the Clan del Golfo, an armed criminal group which reportedly takes a 10% cut from their output in exchange for access to the tunnels it controls. Zijin’s Buriticá mine is in the subsoil of a large mountain in an almost jungle-like area where the state has little presence, with the Clan already heavily active in gold mining in the area when the Chinese company acquired the project in 2020.
Zijin reported having lost control of at least 60% of its mine shafts to the Clan since March 2023. The company has held the concession for this mine since 2020, when it bought the operations from Canadian Continental Gold, which set up in this part of the country in 2011.
A Zijin source, who requested anonymity, claimed that from January to September this year, the company recorded 74,333 detonations of explosives with which informal miners sought to stop the work of Zijin miners. In addition, the source alleges that 943 devices have been set off to damage its infrastructure and 830 shots have been fired at its people.
However, when asked about this, spokespersons for the informal miners deny that they have been responsible for any attacks.
Teresa Mazo, the legal representative of the Colombian Agro-Mining and Environmental Association (Asominacol), a non-profit that supports miners and the mining community, disputed the notion that informal miners have attacked Zijin, saying: “We are not aware of these confrontations because in Buriticá, the area where the Zijin tunnels are accessed is private and guarded by the army; a normal citizen cannot enter.”
According to Mazo, the National Mining Agency (ANM), which regulates mining activity in the country, made 83 recommendations to Zijin on matters to improve the situation in the area, following allegations that the company had poured “toxic sludge” into the tunnels where informal miners were working. “So far, they have not told us if the corrective measures have been applied,” she added. A company statement in May rejected the accusation, decrying “rumours” and stating that it had been carrying out mandatory backfilling of tunnels as required by authorities, and that this process “strictly complies” with regulations.
Among those who work unofficially in the area of Zijin’s operations are ancestral miners, who are from the region and have been mining for years before the arrival of corporations, as well as others who arrived from other parts of the country attracted by the discovery of gold. In May 2023, the Ancestral Miners Community of Buriticá filed a petition demanding Zijin grant access to 140 hectares (or 1.5% of the mining title) where miners have been working for a decade, stating that the work is vital in supporting over 300 local families.
The Office of the Inspector General, the state entity that oversees the actions of public officials, issued a report in mid-2023 stating that “the interference of illegal armed groups in the area to illegally exploit gold is harming the ancestral miners”. It also noted that Zijin has been “a permanent victim of attacks and illegal incursions on its installations and the rest of the inhabitants of this community”.
It added that illegal mining “is generating serious environmental problems such as deforestation and contamination of water sources, which endanger the lives of the inhabitants who consume it and use it in their crops”.
The office also said that illegal miners have looted the equivalent of two tonnes of gold a year, causing losses to the state worth close to COP 1 trillion (around USD 226 million).
After the public disturbances in mid-2024, the area returned to apparent calm, but locals and NGO staff interviewed for this article said this could change at any moment. One explanation given by a spokesperson for a human rights organisation in Antioquia department, who requested anonymity, is that the Clan del Golfo has opted for calm in the face of the possibility of a return to currently suspended negotiations with the Petro government. The group has held intermittent peace talks with the Petro administration over the last two years, as recently as August.
Lawsuits and legal reform
Meanwhile, Zijin’s USD 430 million lawsuit in the ICSID is pending.
In November 2023, Zijin Continental Gold announced its intention to take the case to international courts following a cylinder bomb attack within the illegal tunnels, which killed two people and injured 14. However, it was not until July this year that the New York-based firm White & Case finally filed the lawsuit on behalf of Zijin.
The company has highlighted that it paid USD 1 billion in 2020 to acquire the rights to mine in Buriticá, and alleges that the Colombian state failed to provide them with guarantees of protection despite inviting them to invest.
“Although Colombia induced and benefited from these substantial investments, it has subsequently breached the expectations that formed the basis on which the claimant decided to invest in the country, and in particular, has failed to fulfil its promises of support and protection,” the Zijin Continental lawsuit reportedly states.
In a September evaluation of the situation in Buriticá, the Colombian Ministry of Defence sought to highlight broader challenges across the country in relation to security and armed groups – conditions that are not exclusive to Buriticá – and pointed to measures being taken to improve security in the area, such as mediation and dialogue among stakeholders.
Senior figures from several production sectors, including mining and the broader business community, have called on the government to address the deteriorating security conditions across the country, amid an upsurge in extortion and kidnapping, and have warned of the need for it to intervene to change this reality.
But what worries them most is looming legal instability, says Juan Camilo Nariño, president of the Colombian Mining Association (ACM). Since his campaign for the presidency, Petro has spoken out against extractivist activity in the country, and this has materialised in several initiatives that Nariño claims could jeopardise both already acquired rights and the possibility of new private investment.
Among them is Decree 044, issued by the environment ministry in January, which enables temporary environmental reserves to be declared with the aim of preventing degradation and ensuring sustainable use of resources. It sets out a period of five years, extendable to 10, for further impact studies to be carried out, during which time activities such as mining cannot take place, even if a project is already underway.
Nariño also expresses concern about the draft law for the reform of the mining code that the government will send to congress, which he describes as containing “ambiguous wording” that he says could lead to different interpretations in the future. The Petro government has also proposed the creation of a state mining company, Ecominerales, which Nariño claims “would have a virtual monopoly on mineral resources and would only marginally allow the participation of private investors, which would affect the development of this industry that is so important for the country”.
For its part, the Ministry of Mines and Energy says that the reform and Ecominerales aim to provide “structural solutions to guarantee the sustainable development of the sector and improve the quality of life of mining communities” by pursuing formalisation of artisanal and small-scale operations. Following a first debate over the creation of Ecominerales in a congressional commission in June, the ministry reiterated its intention for the state company to “regulate, promote and guarantee legal stability for private investment” and “compete with other companies to increase efficiency”, while generating “greater income for the state and the mining sector,” it claims.
No date has been set for the company’s creation to be formally debated in congress, but it is likely to face significant opposition, with several lawmakers already voicing opposition.
As for Zijin’s pending ICSID challenge, arbitrators have now been appointed on both sides, but no further details have been released on dates for proceedings. Zijin declined to comment officially on the issue, citing the ongoing legal process; the anonymous company source also provided no comment.
