Colossus Mineral Inc (CSI.to) is the albatross-laden junior gold miner exploring the Serra Pelada gold mining zone in central Brazil. For decades Serra Pelada has been mined by ‘garimpeiro’ artisan miners, with a TV documentary on the intensive mining in the 1980’s and 1990’s available at the company website.
This video is NOT that documentary. Instead, it’s a May 2008 report about the violence and infighting between the local miners still on site and tells the story of the death of one of the main union (or maybe just ‘gang’ would be more apt) leaders.
I was sent this by a smart investor who knows the area well.. I’d heard about the existence of this video previously but had never got around to digging it out. I’m glad I’ve finally seen it, as recently I mentioned that it might be time to do some DD on this company. In the exchange that followed, my correspondent hit the nail on the head when he said that the rivalry and rancour left over from the documented confrontation will surface again. It’s not a case of “if”, it’s a case of “when”. His scenario of “who wants to write the PR about a JV partner being assassinated on a site visit?” may sound dramatic at first, but it’s well within the realms of possibility.
What is telling is the roaring silence out of CSI.to about the obvious bad blood and poor social situation at Serra Pelada right now. On the Christman eggnog circuit, company reps were talking about how they’d found common ground with locals and how all was fine “down there”. Being fine with one gang is all well and good, but that just means they’ve taken sides with the mob that has the upper hand…for the moment.
Political risk in LatAm isn’t just confined to Presidents, administrations and governmental politics. Watch the video.