Canadian mining firms giving country a black eye abroad, report finds

Canada's mining sector is a heavyweight worldwide, but apparently with that clout comes a growing negative image as an environmental miscreant.

Yukon-based Gabriel Resources is at the centre of a controversy over plans to develop Europe's biggest open-pit gold mine in Romania, which includes leveling four mountains and creating a lake of cyanide, which is used to extract gold and silver from the ore.

But The Associated Press reports a Romanian parliamentary commission will reject legislation that would have cleared the way for the Rosia Montana project.

The development has been subject to years of protest and debate over whether its economic benefits outweigh the potential environmental damage, AP said.

The last few weeks have featured widespread protests in Romanian cities, prompting Prime Minister Victor Ponta to pull back from plans to get the project approved.

"The ruling coalition intends to reject the project," Ponta said Monday, but added the government supports foreign investment in its natural resources.

[ Related: Drier weather eases flood threat on crumbling B.C. mine tailings pond ]

Opponents of the Gabriel Resources project no doubt had images of the 2010 failure of a tailings pond adjacent to an aluminum plant in Hungary fresh in their minds. A massive wave of toxic sludge more than two metres deep swept through and flooded several villages, killing at least four people and injuring more than 100 others, BBC News reported at the time.

News that the Romanian gold project may be sidelined comes as the Toronto Star reports that a study has found Canadian mining firms are the worst offenders when it comes to things like environmental and human rights abuses.

“Canadian companies have been the most significant group involved in unfortunate incidents in the developing world,” says the report by the Canadian Centre for the Study of Resource Conflict, according to the Star.

“Canadian companies have played a much more major role [in such incidents] than their peers from Australia, the United Kingdom and the United States."

The 2009 report by the non-profit think tank was commissioned by the Prospectors and Developers Association of Canada (PDAC) but was never made public. The Star obtained a copy of it.

The problems involving Canada’s mining and exploration corporations go far beyond workplace issues, the report says.

"Canadian companies are more likely to be engaged in community conflict, environmental and unethical behaviour, and are less likely to be involved in incidents related to occupational concerns," according to the report.

“Of the 171 companies identified in incidents involving mining and exploration companies over the past 10 years, 34 per cent are Canadian."

CBC News noted last spring that Canadian mining firms have been targeted for demonstrations in Columbia, Greece, Nicaragua, Ecuador, Peru, Bolivia, Dominican Republic, Israel, Slovakia and, of course, Romania.

"Canada is very well represented in global mining conflicts because, in large part, Canada is the home of most of the junior mining companies of the world," Ramsey Hart, the Canada program co-ordinator at Ottawa-based Mining Watch, told CBC News.

Ramsey said that unlike U.S. law, which allows foreign citizens to sue American companies in U.S. courts, Canada has no mechanisms to tackle firms operating overseas whose practices are challenged.

The Star noted the adverse report it obtained is coming to light as Parliament prepares to vote on a Liberal private member's bill that would increase federal oversight of Canadian mining operations abroad.

Brazil is the latest country where Canada's mining practices have come under scrutiny. Prosecutors there are working to stop an Amazon gold mine planned by Belo Sun Mining Corp. on grounds it hasn't adequately considered the impact on local Indian communities, the Globe and Mail reported in September.

[ Related: Report: Canadian spies targeted Brazil's Mines and Energy Ministry ]

And, of course, we can't forget Brazil is angry over revelations that its Mines and Energy Ministry was the target of eavesdropping by the Communications Security Establishment Canada (CSEC), the super-secret spy agency that intercepts communications traffic looking for clues to terrorism. It's alleged that CSEC shared intelligence with Canadian resource companies to give them a competitive edge.

It's not just the mining industry, either. Calgary-based Talisman Energy Inc. was accused a decade ago of working with the oppressive Sudanese government that was engaged in a bloody civil war in Darfur.

A lawsuit filed in the United States alleged Talisman got the Sudanese military to attack rebel villages near the company's oil operations in the region. Sudan was accused of ethnic cleansing but Talisman has questioned the authenticity of the government memo referring to the attacks and denied any knowledge of the military's genocidal behaviour.

A federal appeals court in 2009 threw out the suit alleging Talisman aided Sudan's genocidal campaign against non-Muslims in Darfur, AP reported at the time.