Fourteen years ago last June, in the humid air above these jungly low mountains, an old World War II-vintage helicopter puttered down over the treetops in search of a place to land.
A young Brazilian geologist named Breno dos Santos sat in the copilot's seat, peering down at the massive tangle of jungle green below him. Dos Santos worked for U.S. Steel, and he was mired just then in the terrible logistics of Amazon exploration. U.S. Steel was hunting the manganese deposits scattered around this area, and the old Brazil nut hunters had cleared a tiny jungle airstrip the company planned to use as an operations base.
But it took 3 1/2 hours to bring a helicopter there from the nearest town, following rivers the whole way so that if the helicopter crashed it would not vanish into the rainforest. That was too long a trip for the helicopter's fuel supply, so dos Santos and his pilot were preparing to land and reload the fuel they had aboard.
Dos Santos knew where they would land. For some time scientists had been curious about some large patches of what looked in aerial photographs like low scrubby vegetation around Serra dos Carajas -- the kind of growth, dos Santos assumed, that often apprears over limestone. The pilot spotted one of the scrub patches, and as he lowered the helicopter he asked dos Santos to watch the rear propeller to make sure it did not tangle in the bush.
The rear propeller tangled. Dos Santos was so transfixed by what he saw below him that the pilot's warning escaped him completely. Around him stretched a landscape of dry brush rooted in a vast bed of deep red gravel. "We saw why there was so little vegetation," he said recently, smiling at the memory. "It was solid iron ore."
Dos Santos and his pilot had landed their helicopter on what excited Brazilian officials and headlines now refer to simply as "Carajas" -- the largest known deposit of iron ore in the world. "We started right away thinking, if this is iron ore, all those other spots on the aerial photographs must be iron ore," dos Santos said. "We saw that we had something huge -- 10 to 20 billion tons."
What they have, Brazilian geologists now believe, is 18 billion tons of excellent quality iron ore -- enough for the Carajas area alone to be selling 50 million tons a year by the end of the decade, if their ambitious and optimistic predictions come true. They have an estimated 45 million tons of manganese, 45 million tons of nickel, 1 billion tons of copper, and 100 tons of gold -- all of it running through one extraordinary 46,300 square-mile patch of the Amazon River basin.
From all over the world, mining experts and businessmen have been flying into the red dirt airstrip at Carajas -- the iron ore is so abundant that their airplanes land on it -- and filling the project's guest books with their astonished comments. Japanese, Soviets, Spaniards, Germans and Italians have all come to examine Carajas, and one South African mining company representative wrote, "I don't believe that another mineral deposit like this will ever be discovered."
With the now-legendary national debt estimated at over $60 billion this year, the Carajas wealth has come like sweet tonic to Brazilian government officials, who figure that at today's prices the Carajas iron ore alone could bring in as much as $700 million a year. Of all the natural resources of Amazonia, none is more potentially lucrative right now than the minerals of Carajas, by far the richest deposit Brazil has ever found, as well as the three dozen other Amazonian sites that have been found in the last 20 years to contain large deposits of tin, copper, manganese, bauxite, and other valuable minerals.
"I think that with the advent of Carajas, Amazonia is the country's great economic opportunity for the next decade," said Oziel Carneiro, the former Bank of Amazonia head who now leads the government council on Carajas development.
But there is a catch, and it is one of the single most common dilemmas of Third World countries trying to barter their natural resources for development. In order to get the Carajas iron ore to the marketplace, Brazilian planners have decided, they must have earth movers, screeners, crushers, conveyer belts, loading docks, port facilities and a 550-mile railway to carry the iron ore straight through the jungle and out to the coast.
According to a recent World Bank study, the iron ore project as planned will cost about $5 billion, including finance charges. The total Carajas development project -- a much more complex plan that includes multiple mines, agricultural development, hydroelectric power, and a major port -- has reportedly been projected to cost more than $60 billion.
The higher end of those estimates is about equal to the entire current foreign debt. And Brazil, like every developing non-OPEC country in the world, simply does not have that kind of investment money within its borders. To make Carajas into the bonanza they say will help bail out Brazil, government officials say they have no choice but to turn once again to the developed world. Foreign lenders will help pay for the first iron ore project, and officials say the rest will be built by private companies, many of them foreign mining interests or multinationals.
"We're not going to get any internationalization of the benefits," said Alexander Henriques Leal Filho, an industrial engineer who is technical activities director at the large Rio Engineers' Club, and recently organized a symposium on Carajas. "There will be imports of equipment. All the technology is foreign. The payment of interest on the loans goes abroad. The profit from the investment leaves the country through the companies' subsidiaries. And you don't have control over the price of the product -- the multinational company is able to arrange some kind of low intercompany price."
Since the recent Brazilian abertura began allowing greatly expanded debate and vocal opposition to government policy, one of the most fiercely contested elements of the economic program has been the extensive investments foreign companies have made in Brazil. Central Bank figures list $18.3 billion in total foreign investment -- investments the government says are helping modernize Brazil, and critics say are exploiting Brazilian workers and draining profits from the Brazilian economy.
Foreign capital is at work in the assault on Amazonia, too. Bethlehem Steel and Brascan have invested in Amazonian manganese and tin mining, and U.S. Steel owned 49 percent of the Carajas iron ore deposits before it sold out four years ago to the Brazilian state company that now runs Carajas. "We couldn't come to an agreement on how to proceed," said a spokesman in Pittsburgh.
Georgia Pacific and companies from Japan, the Netherlands, and Denmark have reportedly made substantial investments in Amazonia forestry. Massive cattle ranches have been cleared, with some of the meat shipped straight out for export, on jungle land bought by Volkswagen, a Swift-Armour-King Ranch joint venture, and the Italian company Liquigas, to name a few.
No single foreign project has caused as much outcry among critics as the huge Amazon pulp and forestry project called Jari -- a tract of land the size of Connecticut that was purchased 14 years ago by the American billionaire Daniel K. Ludwig.
In film, books, and articles, Jari was attacked as a giveaway of Brazilian resources, and some Brazilians found it particularly galling when Ludwig in 1974 willed the entire tract to his private, Switzerland-based cancer research foundation. According to visiting scientists and a recent article in Fortune magazine, the project is now in deep financial trouble and up for sale.
"It's a huge problem," said one young official at the Ministry of Energy and Mines in Brasilia. "People say, 'You're surrendering the country' . . . . You stay isolated, or you let foreign companies in with all their resources that Brazil doesn't have. Or you keep them out, and don't develop at all."
Critics at the Rio Engineers' Club say those are not the only two alternatives. They propose that the iron ore project be developed as planned, but that the next phase be a greatly scaled-down $4 billion investment in copper and manganese mining. That amount of money could conceivably come largely from inside Brazil, Leal argued. "With this $8 billion, you could have an entirely national project within 10 years -- without bringing the big international mining companies in," he said.
"We see nothing wrong with multinational participation in the metallurgical sector," said Carneiro, who added that the government's foreign investment laws are designed to ensure that much of a foreign company's profits stay within the country. "There's a little politics here -- some agitation -- a little exaggerated nationalism, no?"