Laid-Off Miners Find Precarious Existence in Cooperatives

CROUCHED over a wooden trough on the side of a stark hill near Oruru, Bolivia, Walter Cruz rhythmically shovels mud against a stream of running water. In this classic, turn-of-the-century fashion, he pans for gold, working to separate the heavy precious metal from the quartz, bronze, and sand. "If we're lucky, we recover 20 percent of the gold this way," Mr. Cruz says. "With the right equipment, we could get as much as 60 percent."

Cruz, like an estimated 45,000 other Bolivians, is a cooperative miner trying to eke out a living. Often with nothing more than picks, shovels, and a knowledge of mining, the workers produce an estimated 2 to 7 tons of gold each year.

"They're not getting rich, but they're eating ... and they get zero help from the government," says Charles "Scottie" Bruce of MINTEC, a private consulting firm that works with five cooperatives in an attempt to attract foreign investors.

Cooperatives have a long history in Bolivia, but in 1986 their numbers swelled. That year COMIBOL, Bolivia's state mining company, laid off 28,000 workers when the bottom fell out of the tin market. With no other job opportunities or skills, thousands of miners organized into small cooperatives. Some staked claims at abandoned mines, others struck deals with COMIBOL to work its inactive mines. An estimated 320 cooperatives now operate in Bolivia, 40 percent of them mining gold.

THE average wage for a cooperative miner is $1,200 a year, according to Bolivia's National Institute of Cooperatives. Working conditions are primitive and dangerous. When the miners are not kneeling in damp mud, they are digging in the mountains' deep veins, which usually have been blasted open with homemade dynamite. Last December, a mudslide engulfed the Llipi gold camp in the Andes Mountains, burying an estimated 300 people. For most cooperative miners, it is a precarious existence. But Cruz and his 2 2 partners could prove to be the exceptions.

They work the Iroco mine outside of Oruru in Bolivia's Altiplano. They were given the mine four years ago in lieu of back pay after being laid off by Inti Raymi, a private mining company. For three years, the group worked the mine manually until they struck a particularly rich vien and MINTEC became interested. MINTEC invested $400,000 with another company, Austrobol. Initial drilling has indicated the mine is potentially worth as much as $140 million.

Drilling tests will continue and more equipment is necessary to put the mine into full operation. Another company, Caneco, has agreed to invest $500,000. For Cruz and his partners, it has an air of unreality. "Right now, we're still only making enough to fill our stomachs," he said. "We'll wait and see what happens."