What is the Dominga Mine, the Controversial Project Associated with the Pandora Papers?

The Pandora Papers are the great document leak of this decade, with almost 12 million files, and, according to data from the International Consortium of Investigative Journalists (ICIJ), this journalistic investigation is one of the most important in history. Among the names that appear on the list of people with offshore accounts, the one of Sebastián Piñera, president of Chile, stands out, who is related to a possible conflict of interest with the Dominga Mine project, which alone has been controversial due to its environmental impact.

What is the Dominga mine and why did it become a scandal with the Pandora Papers?

Officially, the project defines itself as a port mining project, which will extract iron and copper from the mine, the minerals will reach the port through pipelines, there they will be shipped abroad. In addition, the project proposes not only not to use the scarce fresh water in the region, but also to contribute 5 liters of fresh water per second to the La Higuera district through a desalination plant. This will allow the region to create valuable jobs that have convinced local governments and residents, but not everything is positive.

To put it in context, Chile is the world's leading copper producer with 5.7 million tons mined in 2020 alone, according to World Energy Trade data, adding to the increase in demand for the mineral that will double in the next two decades, according the International Energy Agency. This forces Chile to maintain its leadership position by creating new copper extraction centers. Despite its size, the South American country has an estimated reserve of 200 million tons, almost a quarter of the 870 million estimated worldwide, according to the same organization. Hence the importance of the Dominga Mine project, whose investment is estimated at $ 2.5 billion .

The project has two main problems. The first, which also has its sights once again on Sebastián Piñera, current Chilean head of state and government, has been exposed in the Pandora Papers due to a conflict of interest that the president certainly denies. According to the ICIJ, the president's family was the majority shareholder of the project in 2010. The conflict is in a deal for the mine for $ 152 million dollars with a friend of the president, Carlos Alberto Délano, whose last payment was conditional on not establishing an environmental protection zone in the region where the mine would be located, in addition to that the deal took place in the British Virgin Islands.

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Its environmental impact

The conflict of interest could trigger a legislative process that would even lead to the dismissal of Piñera, such is the seriousness of the matter that an investigation has been initiated. Added to the legal problem is the environmental one that has been present since the genesis of the project. Dominga is located in the north of Chile, just 30 kilometers from the Humboldt Penguin National Reserve, a place rich in terms of biodiversity, as it is inhabited by more than 500 species, in addition to penguins, which is why it is considered the "Galapagos Chilean". The biggest drawback for the Dominga mine is that its environmental impact studies have been rejected not only by environmentalists, but by Chilean authorities at different levels, and on more than one occasion.

According to the Humboldt Alliance, which brings together different organizations in defense of the archipelago, the impact of the Dominga mine and Puerto Cruz Grande (another large project in the same region) could be irreversible. They denounce that the project underestimates its area of influence, both in terms of pollution and noise levels and light intensity that could affect the species in the area. The Dominga mine is planned to have a life of 22 years, long enough to create irreparable damage, according to the complainant organizations.

Another concern is water, as it is scarce in the region, organizations fear that the mine is not properly isolated, so that in the event of a geological failure, underground sources could be contaminated. For Andes Iron (company in charge of the project), the impact is overestimated, sticking to what they present in their own report. Despite the refusals of almost a decade, including the government of Michelle Bachelet, last August the Coquimbo Environmental Assessment Commission again voted on the project that was approved this time. For the Dominga mine it seemed a matter of time, regardless of the number of rejections at some point they would achieve approval, the Pandora Papers and environmentalists have shown how.