Smartphone metal funds guerrilla war
Black-market tungsten helps finance Colombia’s rebel army
It’s a sweltering day in March, and Javier Garcia slogs though the dense undergrowth in a remote stretch of the Amazon jungle in southeastern Colombia. He and a friend have hiked all day toward their goal, a mining site 100 kilometres from the nearest town.
Finally, he and his friend arrive at a small clearing pocked with shallow holes gouged into the sandy, red ground. Garcia, 30, squats by a stream, and the men swish watery red mud around a flat wooden pan until pebbles containing a metal called tantalum appear.
“It’s hard work but worth it,” Garcia says. Amazon Indians like Garcia have for decades made a living exploring the rainforest for valuable rocks that contain tantalum and tungsten, both of which are used to manufacture smartphones and other mobile devices.
While the Indians do the digging, they rely on another, more powerful group to get the ore to market: the Revolutionary Armed Forces of Colombia, known as the FARC. The rebel army uses the cash it makes from selling metals to help finance one of the world’s longest-running guerrilla wars, the Colombian National Police say. Garcia says he has mined metals during the past year for the FARC.
“People all over the world seem to want these little stones,” he says. He’s got that right. Tungsten, in particular, is in high demand.
The dark, heat-resistant and super-hard metal is inside the engines of some of the most popular cars in the world. It’s used for screens of computers, phones, tablets and televisions. It helps mobile phones vibrate when they ring. Semiconductor makers use the metal to provide insulation between microscopic layers of circuitry.
The FARC operates its own tungsten mine known as Cerro Tigre, or Tiger Hill, where hundreds of people toil in six hectares of muddy pits, according to the National Police.
The mine is illegal in three ways: It’s inside a forest preserve, it’s banned by Colombian law because it’s on an Indian reservation, and it’s run by the FARC, which is classified by Colombia, the U.S. and the European Union as a terrorist organization.
“It’s completely illegal, but we haven’t been able to stop it yet,” says Col. Luis Montenegro, the National Police commander in Guainia province, where the mine is located. “We don’t control any territory out there; FARC controls it,” says Montenegro, who has studied aerial surveillance photos of Tiger Hill.
The mine can produce 15 tonnes of wolframite, a rock containing tungsten, in a week, police say. That’s enough to make tungsten parts for hundreds of thousands of liquidcrystal-display screens, smartphones and semiconductors, car parts and pens, according to the International Tungsten Industry Association.
While Tiger Hill is illegal, it’s the only known tungsten mine in Colombia, according to the police and Environment Ministry officials responsible for regulating mining.
And that metal is finding its way onto world markets.
One company that buys and processes Colombian wolframite, or tungsten ore, supplies some of the world’s leading multinational corporations, including the makers of BMWs, Ferraris, Porsches and Volkswagens as well as Siemens AG and the producer of BIC pens, these companies say.
Apple Inc., Hewlett-Packard Co. and Samsung Electronics Co. purchase parts from a firm that buys from the company that imports tungsten ore from Colombia, company records show.
Since 2008, there have been 40 shipments of tungsten ore from Colombia by 14 companies, according to government export documents. Although none of the records from these shipments say the tungsten ore comes from FARC-run Tiger Hill, Colombian authorities are convinced that it does.
Cesar Melendez, the Environment Ministry’s director whose jurisdiction includes much of Colombia’s Amazon region, says the shippers are hiding the tungsten ore’s true origins. “This is how they launder tungsten.”
One of the biggest buyers of Colombian tungsten ore has been a U.S. unit of Plansee SE, a Reutte, Austria-based metals processor, according to export records filed with Colombia’s tax agency. In 2012, two Colombian minerals companies, Geo Copper SAS and Minerak SAS, sold seven loads of tungsten ore totalling 93.2 tonnes to Plansee’s U.S. subsidiary, Global Tungsten & Powders Corp., export records show.
The filings say the Colombian companies shipped the tungsten ore — valued at $1.8 million — to Global Tungsten’s plant in Towanda, Pa., which makes refined powder, wires and chemicals.
On July 2, five days after a Bloomberg reporter questioned Plansee about the FARC origins of its Colombian tungsten ore, Global Tungsten & Powders issued a news release saying it would stop buying tungsten ore from Colombia.
“The tungsten minerals from Colombia may have been mined illegally,” the statement said.
The company said it hadn’t been aware of that possibility until it had been provided information “by a reliable source.” The release said “armed groups may be exerting influence over the tungsten mining sites and/or transportation routes.”
As international groups have been monitoring whether companies are buying so-called conflict minerals from Cen-
“People all over the world seem to want these little stones.”
JAVIER GARCIA, COLOMBIAN MINER
tral Africa, there have been no alerts about metals from Colombia, says Sophia Pickles, an investigator for Londonbased non-profit group Global Witness.
“It’s alarming this is happening in Colombia,” she says.
Companies that have bought parts from a supply chain that included tungsten ore from Colombia say they had been unaware of any possible links to the FARC before they were contacted by Bloomberg.
Apple, BIC, BMW, Ferrari, Samsung and Volkswagen say they’re opening investigations to secure their supply lines.
In May, the Colombian National Prosecutor’s environmental crimes unit opened an investigation into companies that may be buying tungsten ore from Tiger Hill.
One Colombian company that has exported tungsten ore is Cali-based Geo Copper, export records show. Geo Copper chief executive Edgar Rengifo helped create the company in August 2010.
Minerak, the other Global Tungsten & Powders supplier in Colombia, was 50 per cent owned by Geo Copper when it was started in 2011. Rengifo says the tungsten ore the two companies export comes not from Tiger Hill, but from a licensed mine that Geo Copper co-owns, called Caney de los Cristales, located about 150 kilometres west of Tiger Hill.
Although Caney is licensed to produce tungsten ore, no exports are coming from the site, according to Colombian officials.
The National Police, the army and the Environment Ministry say Geo Copper’s tungsten ore actually comes from the FARC’s mine.