Tilting at FriedlandPublished by MAC on 2006-09-14
Tilting at Friedland
14th September 2006
In its series "Worldbeaters: Taking aim at the rich and powerful" The New Internationalist magzine in its August 2006 issue summarises the case against the notorious mining entrepreneur, Robert Friedland.
Status: Chair of Ivanhoe Mines.
Reputation: Speculative, high risk mining operations. 'King of the Canadian Juniors' to his friends; 'Toxic Bob' to environmentalists.
Robert Friedland is a 'self made' billionaire. He made number 645 on the Forbes list of the richest Americans in 2006, with wealth close to $1.2 billion. Described as 'arrogant, petulant, insulting' but also 'intelligent', 'flamboyant' and 'an evil genius' by his friend Doug Casey, in 2003 he was named 'Mining's Biggest Renegade' at the Dirty Digger Awards. [Organised by MAC].
Friedland's companies specialize in mining where others fear to tread. His adventures have taken him to Burma and partnership with the military regime, the State Law and Order Restoration Committee (SLORC), now reborn as the State Peace and Development Council (SPDC); to Angola and Sierra Leone in the 19805, when the mercenary outfit Executive Outcomes were active in the region; to Papua New Guinea, where the mercenary group Sandline International was also active; to desert areas of Mongolia; and now to Australia during the country's contentious uranium boom.
According to Pratap Chatterjee of CorpWatch, Friedland was dubbed 'Toxic Bob' in 1969 when he was busted for trying to peddle 8,000 'hits' of the hallucinogenic drug LSD to an undercover drug agent in Portland, Maine.
He attracts investors with his showmanship, bullish predictions and well placed friends. Ventures in Oregon were based on what he claimed a Hindu god had told him. Doug Casey says: 'He builds arguments and tells the story of his deals in such a compelling way that you feel like you have to own the stock.'
He got his start in mining in the mid 1980s when a loan from a relative bought him a joint venture with Rio Tinto Zinc in a gold mine in Nevada. His big break came in 1994 when his claim that Voisey Bay in northern Labrador was 'the richest nickel, copper and cobalt deposit on the planet Earth' boosted Ivanhoe shares from $4 to $167 in two years. Today he is saying similar things about Mongolia, despite producing nothing at all while spending millions on public projects to raise his profile with the locals.
In 1997 the Tasmanian Government virtually gave the Savage River iron mine to Friedland for a 'deferred' payment, even changing the law to exempt him from responsibility for any environmental damage it might cause. Friedland is now waxing lyrical about a uranium deposit in western Queensland despite a ban on uranium mining in that state and widespread local opposition.
Perhaps his most infamous business dealings involve the partnership Ivanhoe Myanmar Holdings and later Indochina Goldfelds (renamed Ivanhoe Mines in 1999) forged with the Burmese regime SLORC/SPDC. In 1994 SLORC and Ivanhoe began a lucrative joint venture at the Monywa copper mine, reputedly the most profitable in the world.
Lest we forget, SLORC/SPDC has a record of employing forced labour. With no environmental laws, mining operations in Burma are dirty. Even Rio Tinto refuse to do business there. MiningWatch Canada say SLORC/SPDC are being well supported by funds from Ivanhoe.
Around the world, Friedland has left a trail of environmental wreckage behind him. There was a spectacular cyanide spill from his gold mine in Summitville, Colorado, in 1993, dubbed the 'Exxon Valdez of the mining industry'. He avoided legal responsibility by making a timely resignation. He then tried to sue the US Environmental Protection Agency and Justice Department for 'conspiracy, abuse of process, libel, breach of disclosure duties, loss of business opportunities and damage to reputation'. He subsequently moved his assets out of the country, reaching a settlement in 2000 for $27 million a fraction of the $150 million needed to clean up the mess.
In 1995 the Omai gold mine holding pond collapsed, spewing 3.2 billion litres of cyanide laced tailings into two rivers in Guyana reputedly the largest cyanide spill in history. No reparations at all have been paid here. Though an independent report on the disaster denied any damage, there were news photographs and eyewitness accounts of dead fish, pigs and crocodiles. The mine was a joint venture between the World Bank, the Guyana Government and Friedland's South American Goldfields. Once again, a timely resignation saved him from legal responsibility.
The threat of similar incidents was one of the reasons why people took to the streets to protest against Ivanhoe Mines in Mongolia in April 2006, burning an effigy of Friedland and camping out in the capital, Ulaanbaatar, for three weeks. The venture covers 82,000 square kilometres, an area the size of a small country, relatively untouched by industrial intervention. Even speculators are a bit skittish about Mongolia.
Ivanhoe Mines posted a loss of $23.2 million in the first quarter of 2006. Perhaps Friedland's karma is finally catching up with him.
SENSE OF HUMOUR In 2005 Friedland told an investor conference about his Mongolian venture: 'So we're coming in from outer space and landing at Oyu Tolgoi... And the nice thing about this: there's no people around; the land is flat, there's no tropical jungle; there's no NGOs. We're only 70 kilometres from the Chinese border. It does not snow here. You've got lots of room for waste dumps.'
LOW CUNNING 'What he does trying to find the diplomatic words for this here - he brings the movers and shakers and the decision makers in the country to his table as partners before anything is discovered. For example, his partners in Indochina Goldfields in Burma would appear to be the Burmese Generals.' John Woods, Canada Stockwatch, talking to ABC's Background Briefing in 1997.
Australian Broadcasting Corporation, Background Briefing, 6 April 1997; B Burton, MPI Newsletter, June 1997; D Casey, www.escapeartist.com/OREQ6/Mongolia.html;
P Chatterjee in Albion Monitor, 11 December 1996; P Chatteriee, Project Underground www.moles.org/ProjectUnderground/motherlode/gold/fried.html;
L Distelhorst in The UB Post, 20 April 2006; Ivanhoe Mines www.ivanhoe-mines.com; DK Jodah, Multinational Monitor, November 1995; Forbes.com;
R Friedland, Resource Investor www.resourceinvestor.com/pebble.asp?relid=9010;
R Moody, Multinational Monitor, http://multinationalmonitor.org/hyper/issues/1994/11/mm1194_08.html;
R Moody, Mining Watch Canada www.miningwatch.ca/updir/Grave_Diggers.pdf;
J Roberts, Albion Monitor, 18 September 1995; M Williams, University of CoIorado, http://snobear.colorado.edu/Markw/Intro/Summitville/summitville.html