Swiss villages, sitting on a gold mine, refuse to budge

They are sitting, literally, on a gold mine.

But at a time when Europe is in the grip of the worst recession since World War II, a cluster of villages in Switzerland has rebuffed the chance to reap the benefits of the gold deposits buried underfoot.

The villages voted in a referendum this month to block a Canadian mining company from mining an estimated $1.2 billion worth of gold ore believed to be underneath the pine forests and snow-capped peaks of the picturesque Medel Valley (see map here). It would have been the country’s first gold mine and one of only a handful in Europe. 

Royalties from the mine would have guaranteed the five tiny villages and hamlets of the valley an income of around 40 million Swiss francs ($43.5 million) over the next 10 years – the kind of money that many towns and cities in Europe, forced to make savage cuts to public services to chip away at government debt, would have been glad to accept.

But the promised bonanza was not enough to sway the majority of the Medel Valley’s 450 inhabitants. With more than 80 percent of eligible voters turning out to vote, two-thirds of them were implacably opposed to the project, which would have lasted at least a decade. 

The proposed mine sharply divided the inhabitants of the valley, which is dotted with centuries-old timber barns and onion-domed churches, and surrounded by sheer-sided mountains. Proponents say it would have provided much-needed money and jobs to a community struggling with an aging population and an exodus of its young people, who have to leave to find employment. 

But those opposed to the project worry about the impact it would have, both on the environment and on the valley's well-preserved culture. 

Is there a future without gold?

One of the gold prospecting's most outspoken backers was Peter Binz, the mayor of the valley, who works as an executive with PricewaterhouseCoopers in distant Zurich.

“The population is declining and aging – 90 of the people here are over the age of 75 – and so we are looking for new opportunities,” he says. “The mine would have brought fresh blood. We cannot stay as a museum – we need a future for our young people.”

At the Hotel Vallastscha, which has the valley’s only bar and restaurant, Thomas Boehm was also convinced that the mine would have been beneficial.

“The mine would have been very positive. Look at this picture,” he sy, pointing at a black-and-white print of the village from 60 years ago that hangs on the wall of the bar, showing two children in grubby smocks playing in an unpaved back alley lined with wooden-tiled houses.

“If nothing new happens here, the valley will go back to as it was then. There’ll be no future for young people. The village is dying but people here are only thinking from one day to the next,” says Mr. Boehm, a German who has lived in Switzerland for 18 years.

Unlike many parts of Switzerland, the Medel Valley has no downhill skiing facilities to attract scores of tourists. The few who know the area come for cross-country skiing in the winter and fishing and hunting in the summer – the thick forests and exposed crags are home to red deer and chamois.

“Right now we get five or 10 people coming in for coffee each day. If we had the mine we could have 100 or 200, maybe even 1,000 people a day. It would bring publicity, which would attract tourists,” argues Mr Boehm.

But opponents said the idea of turning the area into a miniature version of the Klondike is ecological madness and risks scarring the landscape and polluting the valley’s streams and rivers. Developing the mine would have required building roads, buildings, and other infrastructure and excavating about 5 million tons of ore-bearing rock.

“The mine would have had a big impact on the valley, there would have been a huge cost to the environment,” says Nicole Venzin, a teenager who works in a clothes shop in the town of Chur because of a lack of jobs in the valley. “The money would have been nice. But what sort of future would we have if we ruined the environment?”

It was not just environmental worries that fueled the no vote. There were concerns, too, that an influx of foreign mine workers would compromise the valley's culture. The Medel Valley is part of a small region of Switzerland in which people speak Romansch, a language descended from the Latin brought by the Roman legions who conquered the region 2,000 years ago.

“I don’t want a lot of people from another country coming to work here,” says Iris Monn, a young adult who works for the valley administration and voted against the mining project. “It’s very peaceful in the valley. But if the mine was allowed there would be a lot of cars, a lot of people.”

Not the end of the fight

The company wanting to develop the mine is Vancouver-based NV Gold. Based on geological surveys and the results of preliminary drilling carried out in the 1980s, the firm estimates that the local rock contains 10 grams of gold per ton – double the minimum for a viable mine.

The company emphasizes that the exact amount of gold and the precise location of the proposed mine remain unknown because the referendum result squashed the chance of any further exploratory drilling.

John Watson, the company’s president and CEO, estimates that the mine could have yielded around 800,000 ounces of gold, worth $1.2 billion at today's prices. Royalties would have enabled the valley’s administration to slash local taxes and rates, offer businesses cheap loans, and pump money into new investment projects.

Speaking by telephone from Colorado, Mr. Watson said that past negotiations led him to believe that the villagers would approve the mine unanimously.

“It would have had a very small footprint but it wouldn’t have been invisible. They were asking us what it would look like. We couldn’t tell them with any accuracy because we haven’t done the exploration and we don’t know where the ore might be. Am I disappointed with the decision? Yes. But do I respect their choice? Yes, I do. They have great love for their valley.”

But the company remains interested in the area and Mr. Binz, the mayor, is still keen on the mine, so the project may not be completely off the table.

“The reputation of gold mining in the world today is not good. We need to build confidence to show people that mining can be done without harming the environment. To do nothing is not an option – that way we will just continue dying as a community,” he says.