MAC: Mines and Communities

Malawi: is Paladin's uranium mine "headed for disaster"?

Published by MAC on 2012-11-05
Source: Maravi Post (2012-11-02)

 "Who do they take the people of Malawi for? Dull people? Fools?"

This comment was made late last week, by the chairperson of Karonga Business Community at a rally protesting against Australian uranium mining company Paladin, for allegedly breaking a host of earlier promises made to the community.

As local organisations made preparations for a demonstration at Paladin's Kayerekera mine, starting on 14 November, the company issued seberal rebuttals of the local peoples' allegations (see below).

It also warned that, if demonstrators attempted to block the highway leading to the mine, "necessary steps will be taken to ensure the public access is not restricted".

In light of recent bloody events at mines across Malawi's border in South Africa, this was hardly the most diplomatic of statements...

Previous article on MAC: Malawian community takes on miners

Paladin's Kayerekera Uranium Mine headed for disaster

Pius Nyondo

Maravi Post

30 October 2012

KARONGA--The battle between the people of Karonga and Paladin (Africa) Limited, a company that is responsible for mining activities at the Kayerekera Uranium Mine has taken another turn with the people of Karonga saying that that they will protest against the mine's adminstration on Wednesday, 14th November, 2012.

Kayelekera Uranium Mine in Malawi
Kayelekera Uranium Mine in Malawi. Source: OSISA

In a hot and highly tensed up meeting held in the district, non-governemental organisations such as Karonga Youth for Justice and Development, Tutulane Palikimo Business Associations and Karonga Business Community were in attendance representing the people of Karonga in general, suppliers and all business people of Karonga respectively.

Speaking during the meeting, chairperson of Karonga Business Community, Wavisanga Silungwe and publicity secretary for Karonga Youth for Justice and Development described the situation at Kayerekera mine as deplorable and a mockery to the people of Karonga and the whole Malawi nation at large.

"They [Kayerekera mine administration] must give back to the people of Karonga what belongs to them. They promised us a referral hospital, free and safe water, high standard roads which we have not seen four years after production at the mine started. Who do they take the people of Malawi for? Dull people? Fools?" wondered Silungwe.

Silungwe added that meetings between government and the mine's administration have not born any fruits and described some administrators at the mine as stubborn people who are insensitive of the plight the people of this country are going through since Kayerekera Uranium Mine was inaugurated.

"Greg Walker [Kayerekela Uranium Mine General Manager] always arrogantly says that he is aware of the concerns of the people of Karonga but what has he done? Nothing. We think enough is enough and we have deceided to protest against their unhelpful administration."

"Business people in Karonga are not benefitting according to plan. Now they are importing simple things like foodstuffs from foreign companies saying that our things are expensive. Are they serious? How can that be? How can they be importing tomatoes, rice and fish, things the people of Malawi can easily supply?" charged Silungwe.

On his part, Karonga Youth for Justice and Development publicity secretary, Stevenson Simusokwe, said that they were representing the people of Karonga, but in real sense the people of the whole country and asked all Malawians to support their course. He said that they would block the road that leads to Kayerekera Uranium Mine so that no Uranium and foreign foodstuffs go through to frustrate the miners so that they can consider changing their "stupid atittude towards the locals."

"Why can't they just listen to the cry of the Malawian people? Are these people human enough? Do they care about people's lives? Honestly, this is nonsense!" snarled Simusokwe

According to Simusokwe the block will be made at Mpata, specifically at Mwesha Bridge at 7:30am on Wednesday, the 14th of November, 2012. He said that unless Paladin responded to their demands, they would remain on the road; making sure that no business transpires at Kayerekera.

These organisations, on behalf of the people of Karonga, among other things demand that Paladin should give businesses to the locals to supply foodstuffs, engineering services and hardware materials, Paladin should fulfill the promises it made to the people of Karonga, that is, the tarmac road and a referral hospital, that Kayerekela Uranium Mine should have an account in Malawi and not outside the country as it is the case now, that the administration should listen to the employees' union at the mine which is currently voiceless because of the dictatorial tendecies of some administrators at the mine and that Paladin should in one way or another empower the local people of Malawi.

The Kayerekera Uranium Mine saga was first unearthed by a story Marapost published some two weeks ago which quoted Karonga Youth for Justice and Development describing the administration at Kayerekera Uranium Mine as "too corrupt and dishonest." Since then, the story has also been all over local media and recently the issue has been awash in the international media with BBC Focus on Africa saying that it will focus on the mining industry in Malawi, especially Kayerekera Uranium Mine next Friday.


Paladin reacts: Allegations against Kayelekera Uranium Mine false

Pius Nyondo

Maravi Post

1 November 2012

KARONGA--Paladin (Africa) Limited has described as unfortunate and "simply untrue" claims being made by non-governmental organisations (NGOs), especially the Karonga Business Community (KBC), that the company has failed to make good its promises.

The reaction comes a few days after MaraPost published a story that the people of Karonga - home of Kayelekera Uranium Mine - would protest against the mine's administration to show their dissatisfaction in the manner Paladin (Africa) Limited is handling its activities.

In an e-mail response to a questionnaire MaraPost sent, Paladin (Africa) Limited General Manager for International Affairs, Greg Walker said that it was sad that Mr. Silungwe, chair of Karonga Business Community, and others have chosen to launch a campaign against the company.

He said there was no substance to various claims by Silungwe in relation to the conduct of operations at Kayerekera Mine and in relation to their business dealings with the people of Karonga.

Walker added that he has dealt with the complaints being raised by the people of Karonga quite extensively in a letter (which MaraPost has in possession) to Malawi Vice President Khumbo Kachali.

He admitted Silungwe sending him three e-mails but said that "the e-mails were indicative of the lack of good faith on the part of Mr. Silungwe that he should pre-empt a response by the company by announcing [through the media on Wednesday] that the decision had already been taken to go ahead with the demonstration."

In his letter to Kachali, Walker wrote that the assertion being made by KBC chairperson Silungwe that "Karonga and Malawi has potential to supply and transport lime, sulphur and any other item needed at Kayerekera, but Paladin gives these contracts to internationals" as untrue, saying that none of the reagents such as Sulphuric Acid, Sulphur, Slaked Lime, Hydrogen Peroxide and Grinding Media used at the Kayerekera Mine are mined or produced in Malawi."

Walker went on: "On the recommendation of a former Minister for Natural Resources, Energy and Environment, PAL entered into a supply contract with a company called Active Logistics Pvt Limited of Blantyre, placing an initial supply order for the delivery of sulphur. On 19 May 2011, PAL paid Active Logistics an amount of MWK 129.1 million (US$ 256,882), which was 30 per cent of the total value of the contract. Active Logistics claims to have placed orders for the supply of sulphur with two Chinese companies, but no sulphur has been delivered. PAL has commenced legal action to recover its money from Active Logistics."

On the allegations that Karonga-based companies are disadvantaged in the provision of transport to the Kayerekera Mine, Walker said in most cases it's the importing companies - and not Paladin - that selects the road carrier used to transport materials from the various ports of entry to the Kayerekera Mine.

Walker, however, said that in some cases, as with fuel, acid, hydrogen peroxide and caustic soda, specialised transport vehicles are required, which aren't available in Karonga. He said Paladin currently hires 20 vehicles and machines at the Kayerekera Mine. Of these, he said, 15-75 per cent- are sourced from Karonga- based companies. He cited Blue Waters Car Hire, Fikupana Investment, Peters Freight as some of the Karonga-based suppliers of transport to the Kayerekera Mine.

On local food purchasing which Silungwe claimed Paladin imports from Namibia, Walker said the company buys from 23 Karonga-based suppliers of vegetables, rice, beef, eggs and beans.

Walker also said that Paladin has never promised free water for Karonga as Silungwe and Karonga NGOs are claiming.

He wrote: "The provision of water is the responsibility of the Northern Region Water Board (NRWB) and PAL has no influence over the pricing policies of the NRWB. Similarly, PAL has never promised to rebuild KDH to referral standards, although the Company has carried out renovations and repairs to KDH. PAL has requested Mr Silungwe to provide any evidence in support of his claims. He has failed to do so. In fact, PAL has met and exceeded its Social Development obligations, which are clearly defined in the Development Agreement."

Walker said that Paladin has spent a total of US$ 15.8 million on Social Development projects to-date - significantly exceeding its Development Agreement obligation to spend $US 10 million. He added that currently employees at the Kayerekera Mine are some of the best earners in Malawi with their perks ranging from K38, 000 to K1, 000, 000 a month.

Paladin's Kayerekera Uranium Mine is under pressure from the locals who claim that Paladin has not fulfilled the promises it made to them during its inauguration. Some of the promises that haven't been fulfilled, so the people of Karonga claim, include provision of free and safe water, provision of business opportunities to the locals and construction of high quality roads in the district.

Some NGO's in Karonga, led by Silungwe, have planned to stage a protest against Paladin on the dispute. As of Wednesday, the NGOs had already drafted their petition which has been signed by Silungwe and Ngwile Viyuyi, chaiperson for Karonga Youth for Justice and Development.

The petition, Marapost has been told, has been delivered to the Karonga District Comissioner's Office and will also be presented to Paramount Chief Kyungu.

Controversial Karonga-based author, Garnet Kamwambi advised Karonga NGOs and the people to be patient on the dispute saying that the protest should wait to give dialogue a chance. Kamwambe said that the current government, contrary to the former regime, seems to be more understanding in the problems being faced by the people of Karonga which he described as a "carry over" from the past.


Battle lines drawn: Chief Kyungu point man fails to head off protest against Paladin's Kayelekera Mine

Pius Nyondo

Maravi Post

2 November 2012

A man who a few days ago, through MaraPost, urged people of Karonga not to demonstrate against Paladin's Kayerekera Uranium Mine has now changed his tune, reports MaraPost's Pius Nyondo.

Speaking in a telephone interview from his Karonga residence, Garnet Kamwambe said he changed his view after meeting representatives of non-governmental organisations who say the company hasn't kept its promises.

The Harvard graduate in Economics who was appointed by Paramount Chief Kyungu as interim chairman of Karonga Uranium Association insists discussions with government are still going on but he told MaraPost he'd failed to head off the demonstrations because the NGOs told him they are "tired of discussions which have not borne any fruit."

Said Kamwambe: "I told them why I felt the demonstration shouldn't take place at the moment but they couldn't agree with me. They said that discussions have failed as Paladin doesn't listen to them. I was still hesitant but they assured me that the demonstration wouldn't be confrontational and that it would be peaceful.

"They insisted that the demonstration is not out of ill-will but that it is aimed at sending a message to Paladin that people of Karonga are not happy with the Kayerekera Uranium Mine. When I listened to all this, I decided to give them a go ahead as a senior citizen of this country on condition that they wouldn't compromise what they had promised."

On Thursday, Paladin (Africa) Limited General Manager for International Affairs, Greg Walker responded to the e-mails by the Karonga Business Community's chairperson, Wavisanga Silungwe, who requested for an audience with the mining company.

The letter, which MaraPost has in possession, reads in part: "I refer to your e-mails of 25, 26 and 28 October 2012, requesting a meeting with Paladin (Africa) Limited (PAL) in order to discuss local business engagement with the Company. I have been out of Malawi on company business and did not return to the country until this afternoon, Thursday, 01 November 2012; however I would like to highlight the following factors in regard to your request: You have conducted a campaign against Paladin (Africa) Limited PAL, both with the Government of Malawi (GoM) and via the media, in which you made and have repeated various claims and assertions in respect of the Company's policy, conduct, undertakings and actions that are factually incorrect, false in nature, malicious and damaging to the Company's reputation."

"PAL will seek to comply with any reasonable and timely request for a meeting made by members of the community; however the Company is not disposed to complying with such requests when they are accompanied by threats. In any event, you requested a reply from Paladin by close of business today, but have demonstrated your lack of good faith by pre-empting the Company's response in announcing on Tuesday, 30 November, that the decision had already been taken to go ahead with the proposed protest action on 14-17 November.

"Following your meeting in August with the Vice President, Hon. Khumbo Kachali MP and various Ministers, I delivered a submission to the Vice President's Office and subsequently to the Minister for Energy and Mining, Dr. Cassim Chilumpha MP, providing detailed factual information to correct the misinformation and address the various erroneous allegations contained in your statements.

"Last week, Dr. Chilumpha informed the British Broadcasting Corporation (BBC) that  he was engaged in investigating the various claims made by you and Mr Mwakasungula. As you initiated this action - without seeking prior dialogue with the Company, I might add - I think we should now show the Honourable Minister the courtesy of allowing him the time necessary to complete his investigations before contemplating any meeting."

Walker also wrote to Marapost that "Paladin Energy Limited (PDN) is a publicly-listed company on the Australian Securities Exchange (ASX) and also the Toronto Stock Exchange (TSX) in Canada. Under exchange regulations, Paladin has an obligation to report material events to the ASX/TSX. The threatened attempt to disrupt the delivery of supplies to the Kayelekera Mine is a material event and, as such, it is necessary for Paladin to report this development to the ASX/TSX. Accordingly, the following statement has been released to the TSX in Canada a short while ago and also will be released to the ASX."

The statement reads in part: "The Company has been informed that two small local non-government organisations, ‘Karonga Youth for Justice' and ‘Karonga Business Community,' propose holding a peaceful demonstration near Karonga during 14-17 November, during which time they may blockade the M26 Public Highway which is an access route to KM. The Company has consulted the Malawi Police Force, who advise that any attempt to block the highway would be unlawful and necessary steps will be taken to ensure the public access is not restricted. Paladin does not anticipate any disruption to its operations however it also maintains adequate stocks of diesel and necessary reagents on site to mitigate the risk of supply disruptions due to weather or other reasons."

As reported by MaraPost, locals say the mining company hasn't fulfilled promises made during its inauguration. They say there's been no provision of free and safe water, business opportunities and better infrastructure.


Paladin says ‘minor' protest not to disrupt Malawi operations

Henry Lazenby

Mining Weekly

1 November 2012

TORONTO (miningweekly.com) - Dual-listed Paladin Energy said it did not expect protest action with regard to its corporate social responsibility (CSR) undertakings to disrupt operations later this month at its Kayelekera uranium mine, in Malawi.

The company on Thursday said two small local nongovernment organisations, Karonga Youth for Justice and Karonga Business Community, had proposed holding a peaceful demonstration near Karonga from November 14 to 17, during which protestors would blockade the M26 public highway, which is an access route to the Kayelekera mine.

Paladin said the protest was part of a campaign by a vocal minority that had made nonfactual and misleading claims with regard to the company's CSR undertakings to the community. Such claims included assertions that Paladin imported rice to feed its workforce rather than buying locally, which Paladin said it did not do, as well as that the company discriminated against local suppliers in food tendering.

"This is definitely not the case as 23 local groups - including nine widows' cooperatives - supply food to the Kayelekera operations. Paladin regards this as one of its success stories in CSR and currently, 70% of all Kayelekera food is sourced from within Malawi," the company said in a statement.

Paladin pointed out that it had contributed a total of $48-million to local suppliers and paid $9.6-million in various forms of taxes to the Malawi government.

The company said it had consulted the Malawi police force, which advised that any attempt to block the highway would be unlawful and necessary steps would be taken to ensure that public access is not restricted. Paladin did not anticipate any disruption to its operations, however, the company did maintain "adequate" stocks of diesel and necessary reagents on site to mitigate the risk of supply disruptions owing to weather or other reasons.

Paladin added that the Kayelekera plant continued to run consistently and results of various cost optimisation efforts were becoming evident, with continued improvement expected in the near term.

The company's stock trading on the Toronto bourse was down 2.54% at C$1.15 apiece on Thursday.

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