Community relations in Americas

Context

Cerro Corona is located in the district of Hualgayoc in Peru’s northern Cajamarca province, where agriculture and cattle raising are the main economic activities. The mine’s direct area of influence, which has around 5,100 inhabitants, includes the city of Hualgayoc and five rural villages – El Tingo, Pilancones, Coymolache Alto, Coymolache and La Cuadratura (2014)
Poverty among the Cajamarca region’s 1.3m residents is high and education levels low by national standards. While 90% of the district’s population now has access to electricity, only 53% have access to potable drinking water in their homes
Cerro Corona’s latest perception study (2016) indicates that the main needs of our local communities are access to drinking water, employment and support for their economic activities
MesÌas Guevara, a candidate with a neutral stance towards mining, was elected as Cajamarca regional governor during 2018. Previous governors have been strongly anti-mining and the province has seen anti-mining protests by communities
During 2018, we changed our main mining contractor from San Miguel to MUR-WY. While there were initially some protests against this decision by affected workers, MUR-WY prioritised the hiring of host community personnel
In 2017, Cerro Corona announced an extension of its life-of-mine by six years to 2030. Our community engagement strategies have been adjusted to the new timescales
The majority of our community projects are funded by our Gold Fields Peru Foundation APPD

Build relationships and trust

Cerro Corona hosts a monthly Dialogue Roundtable, in which progress on several development projects is provided and future work discussed with the Hualgayoc district local government and community organisations. We also meet regulatory with representatives from our villages, local business organisations and worker representatives
We regularly engage with and support events hosted by our communities near Cerro Corona. Among others, we sponsored the Cajamarca Book Fair, the El Tingo Agricultural and Livestock Fair and supported the Patronage Festival in Honour of Our Lady of Carmen in Hualgayoc, one of the most important religious festivals in the province
We host regular school and community visits to our mine, as well as visits from other interested organisations and institutions
We trained 29 journalists from community media on investigative journalism to build a better understanding of responsible mining

Manage risk and impact

POTENTIAL PROTESTS AS A RESULT OF ALLEGED IMPACTS OF BLASTING ON HOST COMMUNITIES

Risk: Possible social protests set off by the collapse of houses with structural damage in Hualgayoc, as well as houses allegedly affected by in-pit blasting in the Pilancones hamlet.

Action

Engagement with the Pilancones community to address housing claims and joint monitoring of vibrations and noise
We submit weekly blasting schedules to the local municipal authorities and place notices announcing blasting times at the Gold Fields office in Hualgayoc
Close coordination with communities for temporary evacuation of families and their cattle before blasting
An assessment carried out during 2016 and 2017 identified 22 houses to be rebuilt in Hualgayoc because of a high risk of collapse. So far ten houses have been rebuilt and the demolition and reconstruction of six others is currently ongoing
A reconstruction committee has been set up in Hualgayoc, comprising community representatives, the municipality and other authorities

2018 spend: US$471,000

COMMUNITY ACTION AGAINST TAILINGS SPILLAGE

Risk: Community action against Cerro Corona in protest of the 16 December 2018 tailings discharge into the Tingo river (Environmental stewardship).

Action

Regulator, local authorities and communities notified and activated immediately on news of the leakage and environmental parameters returned to normal within 24 hours
Rehabilitation of the affected area started immediately and was completed within 20 days – community members were used in clean-up operation
Compensation of US$36,000 paid to a nearby trout farmer
About US$132,000 paid in restoration activities
Engagement with regional environmental activists through government mediation

Create and share value

HOST COMMUNITY EMPLOYMENT AND PROCUREMENT

By end-2018, we achieved a 27% host community employment representation – above our target of 25% – meaning that 633 members of our host community now work at Cerro Corona. The mine is working to increase host community employment by using host community employees for seasonal labour requirements. The new mining contractor, MUR-WY, has also focused on employing community members in line with our policies
In 2018, we successfully focused on increasing the proportion of sustainable host community procurement spend. This totalled US$24m, 16% of our total procurement spend, against a target of 9% from 233 host community suppliers
A steering committee was established to deliver targets, as well as align with new guidance, and to identify work opportunities to shift purchasing from non-host community companies to host community enterprises

For more details of our host community programmes see Value creation and distribution and Stakeholder relations.

WATER SUPPLY

During 2018, we renewed our goal of bringing permanent, high-quality water to our host community for domestic and agricultural purposes. The following projects were completed or are in development under this strategy:

Construction of the water systems for the Kiwillas and Lipiag hamlets was completed in early 2018. The construction involved 19km of distribution piping, 134 house connections, three water reservoirs and three water catchments. An additional 15 pylons were added to the project
The Cuadratura water project commenced in 2017 and was set to be completed in mid-2018. However, the project has been delayed as negotiations continue with a private landowner. Alternatives are being identified.

Benefits to the community: The water systems for the Kiwillas and Lipiag hamlets have provided 1,494 families access to water at a low cost.

Benefits to Gold Fields: These projects further solidify our social licence to operate and reputation in a region where many mining companies have experienced water-related conflicts with their host communities.

2018 spend: US$370,000

LIVESTOCK DEVELOPMENT PROGRAMME

In Cerro Corona’s direct area of influence this programme benefits 599 cattle breeders. During 2018, agricultural experts made 550 visits to farmers during which cattle were given medical treatment and 160 artificial inseminations completed
260ha of pasture were improved or installed in the Pilancones and Alto Coymolache hamlets
Within the wider district, we funded 329 inseminations as part of our genetic improvement project for local cattle. Almost 400 new cows were provided to local farmers
Milk production improvement programmes were rolled out to more than 750 families in the wider district
Sheds for guinea pigs and hens were donated to 67 families

Benefit to the community: Our livestock development programmes have improved the income and economic welfare of over 1,000 families in our communities over the years.

Benefit to Gold Fields: With this programme, which supports the most critical economic activity of our communities, Gold Fields further solidifies relationships with the farmers in the area, contributing to strengthening our social licence to operate.

2018 spend: US$1.3m

OTHER MATERIAL VALUE CREATION PROJECTS

We completed the 4km access road to the Cuadratura hamlet at a cost of US$200,000, giving its 1,000 residents easier access to the surrounding area
We built and equipped a modern community centre for the El Tingo hamlet at a cost of US$310,000
We spent US$45,000 on constructing a Kindergarten and upgrading a children’s shelter in two of our host communities

Measure actions and impacts

Peru SED spend

Peru SED by type 2018

Engagement with communities

2016		2017		2018
123		172		325

Grievances

There was a marked increase in grievances at Cerro Corona in 2018. However, this is an anticipated outcome of the awareness raising about the grievance mechanism in the communities. A total of 69 grievances (2017: 12) were recorded during the year, of which 21 were employment- and procurement-related grievances, 29 were environmental issues caused by perceptions of water contamination and dust,14 related to social impacts/damage due to blasting at Cerro Corona, three grievances related to claims for property limits and two related to concerns with the results of the livestock development project. 33 of these grievances were resolved in 2018, 36 grievances are in the process of being addressed.