The Escondida Mine (57.5% owned by BHP Billiton) is one of the largest copper mines in Chile and has the highest production levels in the country. Since its construction in the early 1990s there have been periodic spills from the pipeline taking copper concentrate across the Antofagasta region from the mine in the mountains to a pier in Coloso Bay to the south of the city of Antofagasta. Additionally, competition for scarce water sources near the mine site has led to conflicts with local farmers.

Local critics of the mine allege that the gravest environmental impacts have occurred in the bay itself, where contaminated waste water has drained into the sea and polluted the coast south of Antofagasta. The lack of baseline environmental studies in the area from before the mining activity began has meant that it is impossible to determine the exact impact on local ecosystems. According to divers and fisherfolk, severe damage has already been done. Monitoring of the waters in the port of Antofagasta has indicated a high level of contamination by heavy metals, although it is not possible to determine the extent to which this is due to the Escondida operations in Coloso Bay.

Conflicts between the residents of Coloso Bay and the company have come and gone. The company has contributed to the resolution of some of the problems. The most recent conflicts were caused by spills of copper concentrate near to the bay in early September 2009. Local fisherfolk and restaurant owners say that they have suffered serious economic loss as a result of the repeated spills because customers fear that fish from the bay will be contaminated – even when a spill has not in fact reached the sea. One restaurateur, Violeta Vargas, told local newspaper El Mercurio de Antofagasta that she lost more than half her customers after the most recent spill. Around 85 families live around the bay and all of them rely on the extraction and sale of marine products. They are calling for compensation from the company and action to ensure that spills do not occur again.

The mine has also been a source of tension with farming communities, because the area is extremely dry and the large quantity of water needed by mining operations conflicts with agricultural and residential use. In October 2007, the Regional Environmental Commission of Antofagasta (COREMA) rejected BHP Billiton’s Pampa Colorada project, which entailed the drilling of 35 new freshwater wells in northern Chile, to meet the water requirements of the Escondida Mine. The campesino communities of San Pedro de Atacama, Toconao, Socaire and Peine finally breathed a sigh of relief, after a year-long battle with the company. The Chilean Government is investigating plans to import water from the province of Salta in Argentina to provide for mining companies. There is opposition in Salta to the export of water to Chile.64