Mining II

To add to the prior post, I thought it good to tell a bit more about El Pao’s background and impetus as something of a microcosm of the myriad mining and petroleum camps dotting Venezuela in the 1950’s.

As noted in the Time Magazine article cited in the previous post, El Pao was a Bethlehem Steel iron ore mining camp built in the 1940’s in the Venezuelan southeastern interior, within a low and gentle mountain range in an area of dense, seemingly infinite jungles, just beyond the Gran Sabana prairies and plains whose boundaries seemed to melt with the sky.

The company, along with US Steel had negotiated concessions with the government of Marcos Pérez Jimenez, the shortest-lived of the numberless military dictatorships in Venezuela’s history.  Actually, these concessions were signed prior to Jimenez’s official assumption of the presidency, but “everybody knew” he was actually in charge a few years before his official ascension in 1952. Perez Jimenez sought to enhance Venezuela’s independence by promoting oil and ore concessions and improving and expanding the transit infrastructure. He insisted, wherever possible, the companies build “open cities” as opposed to closed camps. US Steel did just that, which impelled the phenomenal growth of the thriving metropolis of Puerto Ordaz, at the confluence of the Orinoco and Caroní rivers. As for Caracas, it was modernized with skyscrapers, including the symbolic Humboldt Hotel, overlooking the capital city from atop Mt. Ávila. The hotel was named after the famous naturalist and explorer, Alexander Von Humboldt, who explored and studied much of Venezuela in the late 18th century. We’ll be seeing more of him in later posts. Construction projects were launched to build large public housing projects, bridges, and South America’s finest highway system, most of which would still be in use into the 21st century, including the then spectacular La Guira – Caracas expressway in 1953 and the Tejerías – Caracas expressway in 1954.

Furthermore, his tenure saw the creation, in 1956, of cable car transport to the 6,000 ft., Mt. Avila, which stands like an imposing sentinel over Caracas. He also commissioned the building of the even more remarkable cable car system to the 20,000 ft. Pico Bolivar in the Andes in the western state of Mérida. Both systems were built by Swiss engineers and materiel. Venezuela was transformed into the most modern nation of South America: “modern” defined as excellent infrastructure, breathtaking skylines, and a rapidly growing middle class. Today, some old timers say it was the Dubai of the 1950’s.

A telling but quickly forgotten change imposed by Perez Jimenez was the revision of the official name of the nation. Since 1864 the country’s name was “United States of Venezuela”, reflecting Simón Bolivar’s admiration for the United States, but not his conviction that South America should not seek to emulate a similar type government because, as he put it, “the United States form of government will only work for saints, which is what they are [and what we are not]”; Marcos Pérez Jimenez, apparently understanding Bolivar’s admonition, changed the name to “Republic of Venezuela”, a name which stuck until, in the 21stcentury, another authoritarian politician changed the name yet again, but left Venezuela’s 20 states intact. El Pao was in the large state of Bolivar, to the southeast of the country, bordering on Brazil to the south and British Guiana to the east.

Marcos Perez Jimenez ruled from December, 1952 to 1958, but his following persisted even after his death five decades later, in 2001. 

A plebiscite was held in December, 1957 which Jimenez won by a wide margin, but which opponents insisted was a rigged exercise. He went into self-imposed exile in Miami Beach, in 1959, only to be deported later by the Kennedy administration, which vainly believed it could afford to break the United States’ promise of asylum in exchange for the applause of Venezuelan politicians: honor out; applause, in. But, as often happens with asymmetrical swaps, Kennedy succeeded with the former, weightier matter; and failed with the latter, transitory one.

Unbelievably, Jimenez was, in 1968, elected to the Senate, even though he ran in absentia from Spain; however, the Venezuelan politicians succeeded in overturning his election on technicalities. In 1973 his supporters nominated him for the presidency of Venezuela; however, the political parties amended the constitution, in effect prohibiting him from running for president again.

He never returned to Venezuela. Nevertheless, love him or hate him, his administration’s negotiations with the American steel and petroleum industries brought matchless prosperity to the country. This promise of future increase and liberality was reversed by the overturning of his economic policies, which tended to favor free enterprise locally coupled with pragmatic agreements with foreign companies, within a low tax and regulatory environment.

Amazingly, all major projects undertaken by the Perez Jimenez administration still stand, unsurpassed: either still in use, such as in the case of the magnificent, now barely maintained, and, therefore, in some places dangerous expressways, or as silent, empty monuments of a long past era, such as the Humboldt Hotel, alone and padlocked, alternating between stints as a reflector of countless brilliant sparkles of sunlight or as a lone sentry shrouded in clouds atop Mt. Ávila, reminding all who look and wonder, that historical eras ought not be facilely catalogued as bright or dark, evil or good. Much depends on who tells the story, how it’s told, of whom it is told, and, of course, by whom it is told.

But the foregoing was yet in the future. Most, if not all, Americans who came to Venezuela when Pérez Jimenez was either in power or was the power behind the throne, that is, from the late 1940’s through the 1950’s, were quite apolitical and gave little thought to the country’s civil government. Streets were safe, people were courteous, Americans were respected and admired, and work was abundant for both Americans and Venezuelans. What mattered to them, and to their companies, was that Venezuela became their largest supplier of iron ore, by far – ore ultimately incorporated in America’s magnificent bridges, skyscrapers, monuments, homes, and automobiles.

For those of you interested in Marcos Pérez Jimenez, you might want to check out the series of interviews (in Spanish) he granted not too long before his death. The link below is for the sixth of the series.

For those of you interested in the Humboldt Hotel, you might find the documentary linked below to be worth your while

Photo of construction of highway from The Orinoco River to El Pao
El Pao baseball team, circa 1950. IMCOV stood for Iron Mines Company of Venezuela, the Bethlehem Steel subsidiary which built El Pao. They began as inexperienced rag-tags and rose to be national AA champions.
IMCOV controller and cashier.
If you liked to fish, you were in paradise.
Caracas – La Guiara Expressway
Cable car up Mt. Avila

Mining

Any blog on Venezuela must include posts on mining. In the future, I hope to have a post or two from guests with more expertise on the more technical aspects of the mining industry in Venezuela and their complex engineering facets. Meanwhile, we can certainly post things of interest or of general introduction.

Depending on your sources, Venezuela was one of the world’s largest producers (some sources had it as the largest) of direct-reduced iron (iron ore which is reduced to a smaller form, usually pellets by means of a specially formulated gas). It was in the top ten of the world’s producers of iron ore, aluminum, and bauxite. And it still ranks as possessing one of the world’s largest known reserves of crude oil, second only to Saudi Arabia, although some say the United States has surpassed both.

It holds one of the world’s largest reserves of gold and was second only to South Africa in diamond production. Countless gems and precious stones have been mined there, especially in the interior state of Bolivar and the giant Territorio Amazonas.

The attentive reader will note the use of the past tense in the second and third paragraphs above. The past tense is used because extraction and production have suffered precipitous declines since the late 1990’s and early 2000’s. I would not be surprised by the discovery of vast new deposits and reserves, alongside the return of successful mining and production, once the investment climate improves. (Meanwhile, we should not be surprised by the intense interest focused on Venezuela by China and Russia.)

In 1956, Time Magazine had at least two issues on iron ore mining in Venezuela. The article in its November 19 issue began thusly: 

“Inland from Venezuela’s Caribbean coast some 200 miles, the swift, black Caroni River plunges into the chocolate-colored Orinoco. Southward from this junction of two mighty streams lie jungles and sandy scrublands studded with low, reddish mountains. This poor-looking expanse is one of the world’s great storehouses of iron. West of the Caroni looms Cerro Bolivar, blanketed with 500 million tons of high-grade ore. Farther west lies another iron mountain, El Trueno, endowed with 150 million tons. On the other side of the Caroni, Bethlehem Steel Corp. gathers up 3,000,000 tons of ore a year from El Pao….”

Poetically and dramatically, the article captures the vastness of the country’s riches in iron ore alone. The country is “awash” with natural resources, even including coltan. We are told that Venezuela is one of only seven countries in the world that have known coltan reserves in sufficient quantities to export. It is a black mineral that is used in mobile (cell) phones and computer chips.

According to recent publications, metal production is at all-time lows; even oil has suffered catastrophically. Here is a recent headline from a technical publication which will suffice for all: “Venezuela’s Iron Ore Mines Operate At Less Than 10% Of Capacity“.

The iron mines of El Pao, where I was born, had massive structures such as a giant ore crusher which was loaded from trucks carrying about 30 tons of ore from the dynamite sites. The crusher ground the ore down to chunks of about 8 inches. Then its covered conveyer carried the reduced ore to a secondary crusher which crushed it further down to 2 or 3 inches. Finally, that ore was poured into 34-car trains which transported 4,500 tons of crushed ore 35 miles daily to the company port on the Orinoco River from whence it was shipped to a deeper water port on the Caribbean coast, transshipped to larger oceangoing vessels, and delivered to Sparrows Point, Maryland, the world’s largest steel mill at the time.

Clearing through the jungles from the Orinoco to the camp site. Arduous work, which at times brought mishaps and frights
Ore crusher at El Pao
train loaded with ore headed to the company port, Palúa, on the Orinoco
Company port 
Sparrows Point, Maryland. At the time, the largest steel mill in the world

That accounts for a fraction of the investment required by one company to successfully extract and produce steel. To that, must be added roads, bridges, hundreds of houses for miners and their families, schools, churches, recreational facilities, commissaries, airports, and more. Multiply that by the dozens of American and European companies who came to Venezuela for iron ore, petroleum, and other minerals, and you begin to get an idea of the gargantuan investment made in the country in the first fifty or so years of the 20th century. For example, US Steel’s investment greatly surpassed Bethlehem Steel’s. And so did the oil companies’.

Some of the home office staff bidding farewell to one of their number who was going on annual leave

Circa 1958, my beloved aunt visited us from Miami, Florida. Although a busy homemaker, she was of that generation who would, nevertheless, find time to experience and appreciate the natural world that surrounds us. So, naturally, we would go on day excursions to different parts of Guayana. Once, in the interior, as we drove over a small stream she asked my father if he’d stop the car so that we could walk around a bit. We got out and made our way to that stream and my aunt promptly took her shoes off and waded in, carefully stepping on the rocks and smooth stones under the water. 

“There are gems in this place,” she said.

I, regrettably, never learned why she thought that, although I do recall spirited conversations between my parents, my godmother, and my aunt about the possibilities. Then, all possibilities having been exhausted in conversation as we wandered around, we embarked and continued on our journey.

A few years later, my father brought a newspaper report noting that a gem mining concession had been granted in that spot, which became a profitable enterprise.

A country might be supremely rich in natural resources; it may have people, like my aunt, who can discern the riches under the surface. But if it discourages investment and healthy incentives, what can we say about all those natural resources other than, “Why cumbereth it the ground?”

Or, “Why bury your talent?”

“There are gems in this place.”

Nixon in Venezuela in 1958

Although I was only four and one half years old at the time of this event, I do recall the commotion occasioned by this event and the embarrassment and sincere regrets expressed by Venezuelans in El Pao and San Félix. Back then, children were not to interrupt adults as they spoke; this gave us much opportunity to listen in on conversations. Although I don’t remember exact words, I do very much recall the revulsion and the anger and the consternation, by both Venezuelans as well as Americans

By my college days, many Americans were downplaying the seriousness of this incident; even making jokes about it. But it was serious enough for President Eisenhower to have ordered a naval squadron to the Venezuelan coast, plus to have placed our Caribbean bases on high alert. All public events were cancelled and the Nixon’s left the next day. Furthermore, a cache of Molotov cocktails was discovered in a building adjacent to where the Vice President was to have participated in a wreath-laying ceremony later that day.

Readers might find the old newsreel linked below to be of interest; especially the gracious words spoken by Vice-President Nixon upon his return to the U.S.A. It’s only 3 minutes.