Community

AngloGold Ashanti’s Cerro Vanguardia mine in Argentina is one of the most isolated and remote gold mining operations in the world. The mine is situated 152 kilometres to the north-west of San Julián, one of the oldest ports in Argentina. The town today numbers some 10,000 inhabitants, 755 of whom are employed at Cerro Vanguardia. The mine is a partnership between AngloGold Ashanti and Fomicruz; the latter is owned by the Santa Cruz Province in which both the operation and port are situated. The remote location and the presence of few alternative sources of economic activity have led to a dependence on the region and the mine as important sources of employment.

AngloGold Ashanti is keenly aware – as at all its operations – of the need to focus on alternative, sustainable options for the local community.

DEVELOPING PORTABLE SKILLS BEYOND THE LIFE OF MINE

Cerro Vanguardia remains active in supporting and developing longer-term initiatives that will continue to benefit the community once mining has ceased. Among the most significant of these is the company’s partnership with the University of Patagonia (UNPA), which has received substantial annual sponsorship since 2006, amounting to approximately $51,600, including the donation of a new hydraulic laboratory. During 2007 and 2008, 81 Cerro Vanguardia employees have undertaken studies at UNPA in various disciplines. In addition to undergraduate studies, a number of vocational skills training programmes intended to provide portable, sustainable skills are in place at the university, such as for example office and computer skills.

During the year, the company also continued to support the Quality Education Improvement programme, launched in 2006. In 2008, the mine’s financial support amounted to $76,000. Based on its investigation in 2007, the principal objective identified for 2008 was to update and improve teaching techniques and standards in San Julián’s primary schools. A teacher-training programme was developed, and approved by the Provincial Educational Council, and teachers were trained in 2007. Work is currently in progress to develop an action plan for 2009.

PARTNERSHIP WITH LOCAL COMMUNITY AND BUSINESS

A key aspect of the company’s approach is the support it provides to the San Julián Development Agency, a partnership between the mine, local business and the local municipality. Cerro Vanguardia’s partnership with the agency goes back to 2004, since when it has contributed some $160,000 per year to its funds.

“Some challenges were encountered in the early days of the agency, because of the difficulties involved in managing the differences in expectation between the various partners, but steady progress has subsequently been made,” says Adolfo Valvano, Head of Community Relations at the mine.

Among the most important initiatives undertaken by the agency has been the development of the Participatory Strategic Plan of Sustainable Development for San Julián for the period 2007-2020. In June 2008, the agency team presented its final report to the community and the local and provincial authorities. Key objectives of the report include the provision for the community on the basis of developing different economic activities (intended to be sustainable after the closure of mining operations), and for improvements in the principal social areas of education and health.

“This plan is the first of its kind promoted and financed by a mining company in Argentina,” says Valvano. “The features that make it unique are the active ownership and participation by the local community members, who have conducted a number of forums with 1,200 community members, academic staff from UNPA and other professionals. The outcome of these was the agreement that renewable energy, aquaculture, tourism, health and education would comprise the plan’s key focus areas.’

On the economic front, a number of activities have been implemented through the agency’s intervention, such as:

• A wind-measuring tower (anemometer) has been installed 8km from San Julián, in an area selected by experts from the UNPA. The ultimate objective is the construction of a windmill to generate clean and renewable energy for the community.
• The prevailing weather, temperature and other characteristics of the coastal area surrounding the port render it suitable for mussel-breeding. An investigation into the feasibility and potential of markets of this programme is under way.

As far as skills development is concerned, a programme intended to increase the participation of local suppliers to Cerro Vanguardia is under investigation by the Agency with the participation of the local Chamber of Commerce. The programme aims to improve local marketing, training suppliers in San Julián regarding such topics as compliance with delivery schedules and the establishment of competitive product pricing. This programme is a new development, and results will be known at the end of 2009. Cerro Vanguardia continues to support local suppliers where possible: in 2008, the purchase of local goods and services increased by 33% compared to 2007.

To improve environmental management in the area, the provincial management and the local municipality cooperated in the construction of a new waste treatment plant, scheduled for completion in early 2009. The Agency is investigating appropriate waste handling processes.

Also on the environmental front, Cerro Vanguardia established contact during 2008 with the Civil Association Los Algarrobos (a member institution of the World Conservation Union (IUCN). Los Algarrobos is currently developing an environmental education course, tailored to the needs of the arid and semi-arid regions of Argentina, based on the ICMM Good Practice Guideline. Los Algarrobos works closely with the Royal Botanic Gardens in Kew, in the United Kingdom, on environmental education. In November 2008, Cerro Vanguardia facilitated a meeting in San Julián between representatives of Los Algarrobos, the Agency, local authorities and community members, with the objective of investigating joint actions towards environmental sustainability in the region. The Director of Kew Gardens accompanied the visit. The launch of a programme dealing with mining and biodiversity at the University of Patagonia, developed following this visit, is planned for 2009.

TARGETING POTENTIAL YOUNG ENTREPRENEURS

In June 2008, Cerro Vanguardia, in partnership with Fundación Impulsar (a major Argentinian NGO focusing on community development) launched a programme designed to promote entrepreneurship among young people aged from 18 and 35 in the local community through training in business and financial skills, financing and mentorship to enable them to translate their ideas into economic reality. During the first programme, 18 young people were trained over a two-month period in a variety of business techniques. Of these participants, 12 submitted their business plans to the Regional Council, and 11 were approved. The projects covered such fields as electrical maintenance, the construction of concrete furniture, design and construction of wrought iron products, the establishment of an academy of music, among others. Two employees of Cerro Vanguardia are members of the San Juli?n regional council of the Fundaci?n, one of whom has been appointed its president.

The second call for young entrepreneurs will be launched in March 2009.

HEALTH PROGRAMMES

A belief that employees and their families should be able to access affordable health care is a key component of AngloGold Ashanti’s business principles. Cerro Vanguardia’s partnership with the local hospital, bringing health care to the community of San Julián, has an established track record. In 2008, the company donated a spinometer (used for measuring the volume of air inhaled and exhaled by the lungs) and equipment for blood sample analysis. Further work on upgrading the hospital’s equipment is planned for 2009.

The company remains active in a number of other community-related projects. “We continue to contribute to a number of educational and sporting institutions in San Julián,” says Valvano. “As far as our work with the Development Agency is concerned, plans for 2009 include developing a proposed financing scheme for the most viable projects submitted to the Agency: the level of financial contribution under consideration is $60,000.”