AURELSA

The Comunidad Aurifera Relave S.A. (AURELSA) is located in village of Relave, in the district of Pullo, province of Parinacochas, department of Ayacucho.  During the mid 1980s, many families and individuals displaced by violence and economic hardship came to the region in the Peruvian Atacama desert in search of a livelihood and settled as informal miners working on the tailings (relaves) left by previous mining operations.

In 1986, they formed the Asociación de Mineros Artesanales de Relave with 200 miners and started building the village.  They gained governmental recognition as a settlement annex in 1993, the first step towards having a school, seeking the guidance of authorities and professionals to improve their mining methods and engaging with the Ministry of Mines.  To access mining titles, they were advised to form a private company and invited the whole community to jo

in their collective effort, however, only 86 individuals chose to invest their time and money in creating AURELSA.  The company was subsequently established on 26 July 1997 with 78 men and eight women, holding mineral rights over 1,000 hectares.

The company operates an accounting system, declaring its annual and monthly tax on income in accordance with the current legislation.  General assemblies take place at least annually.

For mining purposes, participants are organised into working groups within the AURELSA mining area: Group One and the Coronado Brothers and Ataucusi Groups.  Other units of authorised producer partners work under the company’s mineral title as self-employed miners, with equal rights and obligations to the shareholders, as set out in the company by-laws and the General Law On Peruvian Companies.  The parties’ relationships and entitlements are regulated by formal agreements and the shareholders and registered producer partners who work within the company’s mineral rights pay 10% of their production to AURELSA.  Aside from the royalty payment, producer partners are free to sell their mineral to whomever they choose, but generally prefer AURELSA due to the better prices and fairer treatment they receive.

Nineteen contracted workers including a permanent plant engineer, mining engineer and other administrative and technical professionals receive a monthly salary for their work based on the function they perform and regardless of their gender.  Each member of the board of directors receives a cash payment for the meetings they attend and a group of shareholders offers the company permanent services such as mineral and water transportation.  These groups are also paid in cash, rather than in kind or mineral. 

Relave is affiliated to the Regional Association of Artisan Mining Producers of Middle South (AMASUC) and to SONAMIPE (National Association of Artisanal Miners of Perú).

The mine is underground and hard rock, with seven different mine tunnels and veins from 25cm to 40cm.  Miners process on average 180 metric tons each month, with a total yield of 4.5kg of 18 carat gold.  The company has its own personnel for operations at the mine and plant, which processes the mineral with vat leaching technology although an agitation plant is being installed.  The plant currently produces activated carbon, which is sent to Lima for refining and desorption, however, the miners are planning to set up their own facility in Relave village.

AURELSA has all approved licences and environmental, explosive and other permits for both the mine and the processing plant.

The miners’ main social achievement is Relave’s recognition as a formal settlement or centro poblado with an elected mayor since 2002.  They have three schools for over 500 students, a health centre and are working on the urban development of the village.  The mayor of Relave, who also is AURELSA’s manager, transferred the traditional Peruvian mills or quimbaletes - where the mineral is ground and amalgamated with mercury by individual miners – from the town centre to an industrial park outside the settlement.  Children are forbidden from accessing this area.  The mayor has also been actively involved with other miners in lobbying for and advocating the recognition of rights of artisanal miners and the creation of artisanal mining laws in Perú.

There are about 600 families in the municipality of Relave.  Other mining companies and processing plants, Ballón, Milagros, and Cominsa, provide services for artisanal mining so that not all development activity depends on AURELSA.  However, AURELSA provides electricity to the village at a subsidised rate from 6pm to 10pm, and it is often asked to support community initiatives, especially as the company manager is also the village mayor.

The miners’ main challenges are to continue improving their processing methods, set up a laboratory for gold assaying, build their own carbon desorption plant and increase training in trading expertise to export and deal with importers in Europe and the US.  They are also working to improve shareholder participation in the company’s activities, and are seeking access to working capital and credit to implement better technology and enlist all workers onto the payroll.  The miners exported their first consignment of gold to France in October 2008, and are very keen to become Fairtrade-Fairmined certified.