Petaquilla Gold S.A. has always had environmental norms

The company Petaquilla Gold has addressed the resolution of the National Authority of Enviornment (ANAM), because since the entity that rules this mattered issued the resolution 809 of November 26 of 2008, through which approved the EIA of the Project Molejon, the company Petaquilla Gold S.A. has being involved in meetings with the authority in which the responsible of different direction of the institution have being involved.

In these meetings the company gave the ANAM all the studies that had been requested, including: certification of cyanide management plans of water, air and soil quality monitoring.

Another important aspect is that since the company first started working it has been regularly inspected by the ANAM and the MICI.

To even give greater validation to the work done the ANAM has hired foreign experts for the supervision of several Project including the Molejon project.

ITS Company stands out, they visited the project and discussed in a very constructive way with suggestions and observations made by expert miners of Colombia.

After these meetings and the exchange of information by the experts, it was made clear that there is nothing that can be interpreted as harmful to the environment, product of the mining activity.

“We have complied with the conditions instated by the ANAM in the Resolution of Approval, by given out the technical reviews which include among other things the plans of environment management, Emergency plans for the region, studies on the impact to the health of the worker and populations in the area of influence of the project, highly technical documents which are in the ANAM possession today”, was stated in a statement made by the mining company.

They pointed out that they have complied with all the rules by giving out an additional EIA about a generator plant that is in the Project, even though that the Caterpillar generators are certified products by international environmental norms.

Despite this, Petaquilla Gold complied with the resolution of the ANAM, by carrying out the EIA with independent consultants and was given to the ANAM for its approval.

“all the reports of compliance required have been handed in.” was pointed out in the release made by Petaquilla Gold.

This Project was conceived within broad- ranging wealth of the nation, in which the Panamanian state has a sovereign right to operate under the tents of a fair use and to avoid at all possible cost any adverse environmental impact, we wish state our firm beliefs to continue complying with all the demands and norms that regulate the mining activity per say.

Technical inspection Report 110-09 for the ANAM:

We are very concerned that any action of supervision and monitoring lead by the national authority of the environment, and that the findings have been notified by means of social notification. The technical report of the inspection of Mining Project #110-08, created by the Direction of Environmental quality protections (DIPROCA), responds to a the legal mandate to control the activated within the project in accordance with the resolution of approval of the EIA 1ª-809-2008. In accordance with the above, we show that this report omits substantive and technical aspect which requires a serene exam and impartial review from a exogenous or endogenous pressure that might provoke an unbalance on the public’s response. We would like to make public the knowledge that in the inspection report mentions a possible non-compliance, without describing exactly in what it consists in regards to the finding and the impacts products according to the activity beings audited. We are concerned that the report only mention in a very negative way, the activities of the company, omitting, what stayed perfectly clear established in the meeting with the ITS and ANAM personal, specifically on the day of the session were the findings were made public, that the company did not find itself in the phase of operation and that the corresponding work made during the testing phase, adjustments and calibration of the process. This report does not mention the procedures, controls or security measurements that the company has successfully imposed and that would even be mentioned during the session were the findings were made public.

Our company has undergone many inspection made both by the MICI and their estates, the Environmental Department of the DGRM as well as the inspection by the ANAM, also including the independent laboratories as the case of ITS: in the previous inspections there had not existed any irregularities, but rather set a high standard in all the aspects and has emitted favorable conclusions. We worry about the dichotomy between the monitoring reports of DIPROCA of Panama in relation to the finding of the Administration Regional of ANAM of Colon, when their last inspection was just days prior to DIPROCA inspection was made. This issued a report with favorable results. And mention again that we are and will continue complying with all the environmental standards both at a national and international level.

SOME EXPLANATORY NOTES ON THE CITED REPORT:

On the management of chemical products:

We do not understand how open allegations about the misuse of chemicals are made if the company maintains a permanent monitoring system on the use of these substances. We also manage all of these substances with a license issued by the Public Ministry UCQ, which regularly inspects us and has not established adverse findings or irregularities.

On the power plant:

In this regard, we wish to point out that in the category III EIA we stated we were going to use CATERPILLAR 2516B generators and we were nonetheless compelled to submit to ANAM, in April 2009, with the consulting services of AMBIENTE E INDUSTRIAS S.A., EIA Class I, whose impacts are not significant not being possible to declare ourselves in default for the simple reason that we have done nothing that requires EIA approval.

On waste management and solid waste:

The solid waste recycling and disposal program, the way it was managed in Molejón and its camps and scrap recycling done in the area near the Molejón checkpoint was explained to ANAM staff. Furthermore, it was mentioned and shown in the picture of said report that there is a recycling area that was covered. Likewise, it is also important to emphasize the reuse of such materials during construction. We consider inappropriate to say the “junkyard that we are improperly accumulating” because these materials, basically iron and steel, are reused and will be disposed of properly once construction is completed. We consider sustainable usage viable instead of disposing solid waste which indeed generates an adverse impact on the environment.

OTHER EXPLANATORY NOTES:

Regarding the alleged non-payment of bail imposed by ANAM:

We make it publicly known that Petaquilla Gold, S.A. has complied with the provision of ALL COMPLIANCE AND ENVIRONMENTAL BONDS that national and international laws impose on projects of this nature. And these are current.

On the non-payment of administrative penalties:

On this sanction imposed by ANAM, by reason of having “started the construction of the project before having an approved EIA,” the company has its own criteria about it and has decided to ask for the arbitration by the Panamanian judicial system.

Petaquilla gets advice on environmental matters from specialists to continue complying with national laws and international standards:

Finally, the company is about to put in place two measures that go far beyond the imposing decisions of ANAM.

The first, already signed with a Swiss company for the Certification of Environmental Quality (SGS), with whom the company will work to achieve ISO 14001 environmental standards certification, and corresponding to the OHSAS 18001, which are the most advanced and demanding in environmental and occupational matters in the world. Implementation of these processes is in hands of the consultant Teresa Pirro.

The tasks that lead to achieving these certifications have already begun.

As part of our own initiative and consulting outsourcing, discussions and Memorandum of Understanding proposals have initiated with the Canadian environmental consulting firm Bennett Jones, which will work for carbon credits. It is important to know that the Molejón project impacts an area of 100 hectares.

Normally, Panamanian environmental laws would not require a reforestation area for compensation of these 100 hectares to be 3 or 4 times its size, i.e. to reforest 3 to 4 hundred hectares.

We voluntarily decided –and so stated in our EIA– to reforest an area of 1,000 hectares, 10 times the size of the impacted area. This is such a positive action for the environment that environmentalists or NGO’s and ANAM should express their high degree of satisfaction.

With this voluntary decision the company contributes so Panama can enter the exchange market for buying and selling carbon credits because reforesting 1,000 hectares will produce a mitigation of greenhouse gas effects and the surplus can be traded on world markets.

On dead fish, deer, lions, tigers and buffaloes allegedly caused by Petaquilla Gold, S.A.

It is important to clarify that, on the same days complaints about alleged dead fish and other kinds of wildlife caused by Petaquilla Gold, S.A. were made, ANAM took samples of water and Petaquilla Gold, S.A. immediately hired Ambiente e Industrias S.A., MICI doing the same, and none of the tests showed a positive result of water pollution by Petaquilla Gold, S.A. constituting an outrageous and scientifically-baseless allegation with the aim of making visible damage to the company.

The information that no such contamination took place was personally addressed to the company by ANAM’s director, Ligia Castro, where she reported that no water contamination occurred and that there was no evidence of mortality of fish and wildlife, information that unfortunately did not come to the open, as it did when we were even falsely accused of environmental crimes as a result of a non-existent situation and only very few media had the courage and honor to make the reality of the facts known.

We reiterate that our position has been, is and will be to develop a sustainable project that meets the national and international environmental standards and to provide, as it indeed is doing, a better quality of life to a sector of the population characterized by extreme poverty.