Alternative Mining Indaba 2013Published by MAC on 2013-02-11
Source: Statement, Reuters, Mail & Guardian, IOL (2013-02-08)
Civil society representatives gathered in a parallel event to South African's Mining Indaba in Cape Town in early February. The official gathering styles itself as the "world's largest mining investment conference."
The 4th Alternative Mining Indaba (AMI) gathered people from across Africa, with other participants coming in solidarity from further afield, to critique the corporate mining agenda. The AMI's Declaration is copied below, along with various articles describing presentations and issues around the meeting.
Details of protests, that were more focussed on South African issues, can be read here.
For coverage of previous Mining Indabas see: Connecting the world with African mining
For our previous article on the issue of the cooption of the development agenda, see: "Aid not Trade" for mining companies?
Declaration of the Alternative Mining Indaba
Cape Town, South Africa
3rd - 5th February 2013
We, members of Civil Society, having gathered at the 4th Alternative Mining Indaba (AMI) in a Peoples' Indaba in Cape Town from 3rd to 5th February, 2013, comprising Faith Based Organisations, Pan-African Networks and Organisations, Trade Unions, Traditional Authorities/Leaders, Non Governmental Organisations and Community Based Organisations express our outrage at the Marikana tragedy because it could have been avoided if the company, trade unions and the government had acted responsibly;
|Protesters outside the 2013 Mining Indaba in Cape Twon.
Phoot: Trevor Samson, Business Day
We express our condolences and stand in solidarity with the families of the victims and survivors. We follow and watch with great interest the proceedings of Marikana Commission of Enquiry and expect justice to be done and those responsible brought to account;
We also express our unwavering support and solidarity with all other people who are victims of economic, environmental and social injustices surrounding the mining deals that put profit before people throughout the world;
We note with concern that African governments are over-dependent on mining and foreign direct investment as the path to development at the expense of other people-centred alternatives;
We remain concerned with the deliberate and systematic marginalisation of poor communities and the people in the decision-making and general governance of minerals and other natural resources throughout the value chain;
The Peoples' Indaba over the past few years have exposed the true costs of mining and its devastating impacts on health, environment, ecology, economy and social wellbeing of workers and communities, which has been ignored by the elites in our society;
We are encouraged by the African Mining Vision adopted by the African Heads of States and Governments as a step towards addressing the challenges identified by the Peoples Indaba since 2009. We remind them that mining and other extractives must serve to address Africa's challenges and contribute to equitable and sustained economic and social development;
We re-iterate that the "Corporate Mining Indaba 2013" excludes the participation of the actual owners of the mineral resources that are the basis of their meeting and therefore fail woefully to address environmental degradation, deepening of poverty, slippages in the quality of life and concentrating instead on the reckless pursuit of profit at any cost throughout the continent and the world;
The three-day Alternative Mining Indaba 2013:
- Deliberated the ongoing continental mining reform agenda represented by the Africa Mining Vision and its potential;
- Debated and analysed government policies and programmes for redressing environmental impacts of mining activities as well as compensation issues for communities affected by mining activities;
- Broadened our understanding of economic and financial policies that facilitate tax avoidance and evasion in the mining sector such as transfer pricing, opaque investment contracts and bilateral investment treaties;
- Shared experiences and justice and peace promoting strategies about the need for a new framework which puts people, environment and communities at the centre of development and not profits.
We now therefore:
1. Call on communities affected by mining to unite in national, regional and international coalitions and movements to fight for social and economic justice in the exploitation of mineral and other natural resources in their communities;
2. Demand ongoing and open negotiations and not "seasonal consultations" with the host communities by corporations and governments on the progress, impacts and declared resources extracted from their land;
3. Echo the sentiments of John Reggie UN Envoy of the company having the responsibility to respect the decision of the communities underpinned by concept of Free Prior Informed Consent, the state having the responsibility to protect and stand by community decision and the community to have a full access to duty bears remedy;
4. Call on African governments to effectively implement the Africa Mining Vision in a way that serves and addresses the needs of our countries;
5. Demand independent and meaningful Environmental and Social Impact Assessment, Strategic Impact Assessment, Health Risk Assessment, Social Impact Assessment, and Environmental Management Programmes;
6. Call on African government to work with the communities to pursue alternative development paths beyond mining;
7. Demand that our governments show leadership and be more transparent and accountable with regards to protecting the mineral resources and human rights of their people;
8. Call on governments to hold mining companies accountable for externalizing costs, and to ensure that mining revenues are redistributed equitably;
9. Demand that corporations' tax responsibilities be increased and not override their corporate social responsibility;
10. Demand that African states should fully exercise their sovereign rights to impose their desired tax regimes to enable them provide social services;
11. Demand for greater transparency and accountability laws, policies and systems in order to tackle secrecy, structures and investments that facilitate tax avoidance and evasion;
12. Call upon African governments to strengthen their capacities to collect the rightful share of revenue from corporations.
We hereby avow our commitment to the above stated issues and pledge our on-going support on the same with unflinching resolve and adamance! We are also committed to working together with communities and other progressive forces to ensure that these demands are met.
At the 4th Alternative Mining Indaba held at the Strand Tower Hotel in Cape Town, South Africa on 5 February 2013 with participants from: Zimbabwe, South Africa, Mozambique, Tanzania, Zambia, Botswana, Ghana, Namibia, Kenya, Angola, Malawi, Mauritius and Democratic Republic of Congo. We were also joined in solidarity by participants from Burma, Peru, Canada, Norway, Belgium, United Kingdom and Sweden
Under the auspices of:
Bench Marks Foundation, Economic Justice Network of FOCCISA, Norwegian Church Aid and IANRA (International Alliance on Natural Resources in Africa).
For more info:
Economic Justice Network of FOCCISA
Office Tel: +27 21 424 9563
E mail: email@example.com
The Mining Indaba and Extractive Sector Cooption of the Development Agenda
8 February 2014
Mining executives, government delegates, non-government organization (NGO) staff and consultants are walking the halls together this week at the Mining Indaba, in Cape Town, South Africa. The Mining Indaba is quoted by organizers to be the ‘largest mining investment conference' in the world. Responsibility and sustainability are not peripheral jargon in these events - they take centre stage. Much will be made of the efforts by miners, ministers and development consultants to make sure that mineral exploitation in Africa is pursued responsibly, to the benefit of all concerned.
Scanning through the dizzying agenda of meetings and presentations in the four-day event, there is little mention of the type of meetings that have begun to grab the attention of human rights organizations - those involving development NGOs, mining companies and government aid and trade delegates.
Whether through the Devonshire Initiative in Canada, the Australia-Africa Mining Industry Group (AAMIG) in Australia or other amicably named alliances of industry, NGOs and Government, in recent years the global mining industry has done well to avail itself of the skills and good names of a growing number of aid agencies and development NGOs. These groupings, or ‘multi-stakeholder initiatives', are part of the response by the global mining industry, originating with the International Council on Mining and Metals (ICMM), to do something to challenge the weight of literature detailing ‘the resource curse'.
Beginning in 2004, the ICMM set about shifting the spotlight away from their members for responsibility that comes with the widely acknowledged phenomenon of ‘the resource curse'. This ‘curse' is characterized by the relatively poor human rights, environmental and development track-records of those developing countries that have strongly embraced resource extraction as an economic model for development. In a 2008 report, chiefly authored by ICMM's Senior Program Officer, Kathryn McPhail, ICMM laid the blame for the symptoms of the resource curse at the feet of developing country governments by primarily concluding that "governance weaknesses" are the basis for these problems, discounting the criticisms leveled at mining companies. Similar conclusions were more recently found by the OECD's Development Assistance Committee (DAC) in their ‘Development Co-operation Report 2012'. Chapter 9 of the report examined the resource curse and found that "the determining factors here, as for other development challenges, are the quality of related governance mechanisms and institutions and, ultimately, the mindset of a country's leaders".
To respond to these shortfalls, the ICMM report called for a greater number of multi-sector partnerships. This call led, in February 2010, to a policy commitment taken by ICMM member companies to "seek partnerships among companies, governments, NGOs, donors and international organizations". Hence, there is increasing attention on the Mining for Development Initiative (and also the AAMIG), the Devonshire Initiative and others - and with it a growing maelstrom of controversy.
So why all the fuss?
In the development and human rights world, partnerships between different stakeholder groups assembled to overcome challenging issues are not a new approach. Sometimes these alliances can bring about progress towards the achievement of critical development, environment and human rights objectives.
However, firstly, in this case the groups involved are hardly without checkered reputations. Barrick Gold, for example, one of Canada's largest mining firms, will be in Cape Town for the Indaba, and is a major player in the Devonshire Initiative - their VP of CSR, Peter Sinclair, sits on the Steering Committee. Barrick Gold happens to also be implicated in a series of serious allegations of egregious human rights abuses. For example, at Barrick's 95% owned ‘Porgera Joint Venture' (PJV) mine in Papua New Guinea (PNG), locals and supporting civil society groups alleged repeatedly that staff of PJV committed human rights abuses in and around the mine site. The allegations concerned killings and beatings of local Ipili men and beatings and rapes, including gang rape, of Ipili women. Barrick announced in October, last year, that a "remediation framework has been developed as part of Barrick's response to specific incidents of sexual violence perpetrated by men who were employed at the Porgera mine against women residing in the Porgera Valley". However, written into Barrick's Remediation Framework document, is a condition that in return for receiving any assistance under the initiative, a woman that was raped must agree that "she will not pursue or participate in legal action against the PJV... or Barrick in or outside of PNG". It is this kind of action that demonstrates how some mining companies express all manner of goodwill, while at the same time protecting themselves, and subverting the course of justice - amounting to interference with the realization of human rights, of which judicial remedy is a vital component.
The members of AAMIG are no angels either. Their Chairman, Bill Turner, recently stepped down as CEO of Anvil Mining, a company with bases in Australia and Canada. The United Nations documented how Anvil, under the leadership of Bill Turner, was complicit in the killing of 73 people in Kilwa in 2004, by Government ‘FARDC' soldiers. The killings involved summary execution, before the bodies were dumped into mass graves. "Anvil Mining's drivers drove the vehicles used by the FARDC" that perpetrated these atrocities. The UN report also noted that "Anvil also admitted that it contributed to the payment of a certain number of soldiers".
But there is more to the concerns about these multi-stakeholder initiatives than worries about mingling with folks with bad rap sheets. The actual notion that mining is a responsible approach to sustainable development is not self-evident. A recent ‘Reality of Aid' report critically examines the role of private finance in aid, and pays particularly close attention in sections to the role of mining in development - casting real doubt over some of the proposed benefits of mining company involvement in development strategies.
The resource curse cannot simply be explained as a matter of the way governments manage resource revenues or handle community disputes. As has been argued repeatedly, companies have for many years made the most of the gaps in host governments' willingness or capacity to impose stringent environmental and human rights requirements (and therefore costs) on companies. As Paladin CEO John Borshoff, and member of AAMIG, has summed up publicly in an Australian newspaper, "Australia and Canada have become overly sophisticated...There has been an over-compensation in terms of thinking about environmental and social issues in regard to uranium operations in Australia, forcing companies like Paladin into Africa". It is an unfortunate reality that some companies take this view and find primary incentives in environments of lax regulation and minimal social and human rights safeguards.
While views of this kind from mining executives might not be a surprise to many, what has changed recently is the promotion by state aid agencies of ‘mining for development' approaches to sustainable development. The Australian Agency for International Development (AusAID) now has a ‘Mining for Development Initiative' and Canadian International Development Agency (CIDA) has directed funding to groups such as World Vision and Pact to partner with companies like Barrick Gold on CSR activities in countries such as Peru and Burkina Faso. While AusAID officials have stressed that none of the Mining for Development Initiative money is paid to companies, their overall development model is shifting in the same direction as CIDA's. In Australia, tax-payer money is provided from AusAID to the Department of Foreign Affairs (DFAT) to administer small projects in host countries - meaning it is therefore technically outside of AusAID's ‘Mining for Development Initiative'. Some of these projects support the CSR activities of Australian mining companies in Burkina Faso, Ghana and Niger. So while it the funding of these activities may be more overt in Canada, the end result is the same - tax-payer aid and development money supporting corporate CSR activities.
These projects include schools, water facilities and such like. While the creation of a school may be a valuable contribution to a community, the important point is the ends don't justify the means. CSR initiatives are about gaining community support for a mining project. State tax-payer aid money is for the alleviation of poverty and realization of human rights. Companies profess to be ignorant of the skills necessary to adequately execute their CSR projects, but they cannot claim they don't have ample resources of their own to hire private sector development experts to assist them, so why should it be considered reasonable for them to call on the tax-payers from their home governments to foot the bill?
Mr Julian Fantino, Canada's new Minister for International Development, views things differently. From his perspective, expressed in a recent press interview, Canadian dollars should be used to bring benefits to Canadians. "We are part of Canadian foreign policy...We have a duty and a responsibility to ensure that Canadian interests are promoted" Mr. Fantino said. "This is Canadian money. ... And Canadians are entitled to derive a benefit". This approach is commonly referred to as ‘tied aid'. Aid agencies around the world have a history of wrestling with this problem. With the approach advanced in Canada and Australia, it seems we may be in an upswing of appreciation of Mr Fantino's view - and the mining sector is the big winner at the moment.
Reliance on private mining companies to provide positive development outcomes is a direction that is questioned by some main-stream development actors. For instance, Robert Fox, Executive Director of Oxfam Canada, posed the following rhetorical question recently when commenting on Canada's shifting aid prerogatives: "Why, if your priority was reducing poverty and promoting human rights, would you identify Canadian mining corporations as your priority in terms of your vehicle for economic development and reducing poverty? That's not apparent to us".
Back in 1992 things were different. Then governments agreed in the ‘Helsinki Package' that aid would not be directed towards ‘commercially-viable projects' - leaving aid money to be used for advancing poverty alleviation and the realization of human rights. As has been documented by the OECD, the ‘Helsinki Package' led to a drop in aid funding for infrastructure and mining projects.
Rather than using aid money to prioritize growth in the corporate profits and social license to operate of mining companies in developing countries, the provision of aid is for assisting countries to realise human rights and alleviate poverty - in non-commercially viable projects. The alteration of this perspective towards support for private sector growth in emerging markets amounts to a cooption of the aid and development agenda. After all, the purpose of the aid sector is firmly rooted in a well-established international legal commitment. Article 2.1 of the International Covenant on Economic, Social and Cultural Rights, to which 160 nations are party, requires that states cooperate internationally to realise human rights - including through the provision of resources from wealthier states to assist in protecting and fulfilling human rights in the rest of the world. Provision of aid money is one practical incarnation of this obligation, not meant to be toyed with as an instrument of foreign policy to the benefit of donor nations.
Rather than supporting their companies to have better CSR programs, the international legal obligations of home states, such as Australia and Canada, require them to regulate the actions of their companies abroad, ensuring the protection of human rights. In 2012, the United Nations Committee that oversees adherence to international legal obligations to uphold the rights of children noted that "the Committee is concerned at reports on Australian mining companies´ participation and complicity in serious violations of human rights in countries such as the Democratic Republic of Congo, the Philippines, Indonesia and Fiji, where children have been victims of evictions, land dispossession and killings". The Committee recommended that Australia "examine and adapt its legislative framework (civil, criminal and administrative) to ensure the legal accountability of Australian companies and their subsidiaries regarding abuses to human rights, especially child rights, committed in the territory of the State party or overseas and establish monitoring mechanisms, investigation, and redress of such abuses, with a view to improving accountability, transparency and prevention of violations".
In 2010, the equivalent United Nations committee that oversees adherence to international legal obligations to eliminate racial discrimination noted "with concern the absence of a legal framework regulating the obligation of Australian corporations at home and overseas" and the impacts this oversight can have on "rights to land, health, living environment and livelihoods", in this case for Indigenous Peoples. The same committee said of Canada, in 2007, that is was aware of "reports of adverse effects of economic activities connected with the exploitation of natural resources in countries outside Canada by transnational corporations registered in Canada on the right to land, health, living environment and the way of life of indigenous peoples". The Committee suggested on that occasion that Canada "take appropriate legislative or administrative measures to prevent acts of transnational corporations registered in Canada which negatively impact on the enjoyment of rights of indigenous peoples in territories outside Canada."
Since these recommendations have been publicized, little to no progress of any kind to incorporate these recommendations has been made by either country. Instead there has only been the increasing promotion of mining as a strategy for advancing sustainable development.
Perhaps there are a few other things that Australian and Canadian government officials could be doing to help overcome mining's impact on development, other than accompanying mining executives to Indaba events and lending legitimacy to them through provision state aid funding and partnerships. Perhaps Australian and Canadian Government officials could better use their time examining how mining affects communities (not the companies), put real legislative and policy incentives in the minds of mining executives that will more likely guarantee that they do the right thing for African communities, and use the aid money to empower local civil society groups to hold them to account.
As for mining companies, they should respect the principles set back in Helsinki, footing the bill for their own CSR activities and leaving aid money for non-commercial activities. They have their own responsibilities to communities and the environment, and they should meet these costs 100%.
In coordination with ESCR-Net, AID/WATCH, CAOI, Citizens for Justice, Human Rights Law Centre, Mineral Policy Institute and MiningWatch Canada participated in the creation of this piece.
For more information:
· MiningWatch Canada, Rights and Accountability In Development & Earthrights International, January 30, 2013 ‘Rape Victims Must Sign Away Rights to Get Remedy from Barrick'.
· AID/WATCH & Mineral Policy Institute, October 2012 ‘Aid Must Not Support Australian Mining Interests in Africa'.
· MiningWatch Canada, November 8, 2012 ‘Poor Mining Companies? Parliamentary Committee Report Calls for CIDA Giveaway to Canadian Corporations'
No 'moral' or 'business case' for use of conflict gold
Mail & Guardian
4 February 2013
The 2013 African Mining Indaba has been told that investors are becoming increasingly interested in human rights matters around the precious metal.
Rand Refinery chief executive Howard Craig was speaking at the first day of the mining indaba on Monday where he was part of a panel of gold industry leaders introducing the conflict-free gold standard, which is to be rolled out by the end of the year.
According to Craig, it's estimated that about 20 to 40 tonnes are mined by illegal miners annually. "To explain it, it would be about half of South Africa's gold production," he said.
The conflict-free gold standard, developed by the World Gold Council, is supported by leading companies in the gold industry and was intended to prevent gold from being used to fund armed conflict.
Nick Holland, chief executive of Goldfields, which is a member company, said the gold sector needed to ensure that the gold sold was not used to fund conflict or contribute to human rights abuses.
"It does not just make moral sense, there is also a business case," said Holland. "We found investors are increasingly interested in non-operational matters, like health, safety, human rights and how we interact with communities. In fact some investors would only ask about these, rather than the operational and financial performance of the company."
The major mining companies, which make up about 60% of the gold mining sector have agreed to cooperate with the standard, and it is hoped the remainder will come on board as well.
Howard, the largest gold refiner in South Africa, said on Monday that gold mining companies could play a role to ensure that the work done by the mines did not undermine the security of a country.
"It's important that African gold is not stigmatised and confused with conflict gold. We need to have procedures in place to ensure that African gold can be proudly marketed."
He said as a refiner they only deal with reputable dealers or with banks, when it came to legal artisanal miners. In the case of scrap metal, Rand Refinery only deals with companies they know and whose products they can source.
Robert Duffy, executive vice-president for Continental Africa, Anglo Gold Ashanti, Paul Mabolia, national coordinator for the ProMines Project, Democratic Republic of the Congo, said the artisanal mining sector was the most vulnerable to armed groups and gold was increasingly popular because it was easy to transport and difficult to track.
An artisanal miner or small-scale miner is, in effect, a subsistence miner, who works independently, mining or panning for gold. In some cases these miners are legally employed, but it's the illegal miners and the conditions under which they operate, including using child labour and poor safety regulations, that concerns organised labour. Not to mention that some of the money from this sector is used to fund rebel movements.
Asked if there was not a need for greater cooperation between governments and the mining companies, Duffy said they believed this was essential but that it tended to be very complex to set up.
He said they had an effective relationship with the government in Tanzania where there were about 200 active pits in the area they mined. Duffy said the company was leading multiple stakeholder discussions about how best to assist this group that in many cases were surviving on the money made from these mines.
"The state and mining companies need to work together to remove the illegal miners and provide them with alternatives, because they will simply pop up somewhere else or return to the property," said Holland.
He pointed out that technical training could be provided for illegal miners and they could be brought legally into the system. "Let's train them how to mine and make them subject to standards. They need to pay tax."
He said by making them legal it made it easier to monitor where the gold came from and where it was going.
Tax avoidance blamed for Africa's loss of resource income
5 February 2013
The top 10 global mining companies have an estimated 6 000 subsidiaries, many of which are located in tax havens, Alvin Mosioma of Tax Justice Network Africa told delegates at the Alternative Mining Indaba yesterday.
Mosioma said this complicated network of companies was part of "the flawed financial infrastructure" that resulted in Africa losing a significant portion of its resource income through complex tax avoidance schemes.
He said one of the difficulties facing African governments in their bid to secure a greater share of the wealth generated by their resources was that as a result of the use of complicated corporate structures and tax havens, "it is impossible for any government to know how much profit is generated from its mineral wealth".
Mosioma said it was not just the mining companies at fault but also their banks, lawyers and accountants who assisted in setting up the financial structures. "How is it possible that you have 3 000 employees in Malawi and three in the Cayman Islands and you can attribute 70 percent of your profit to the operation in the Cayman Islands?" Mosioma said.
He called for greater transparency and also for African governments to stop providing tax incentives, as these merely created avenues for countries to lose their resources.
The indaba, which was attended by hundreds of delegates from across Africa, heard from representatives of communities around the continent about the need for a more equitable redistribution of wealth from mining activities.
A note prepared for the indaba argued that one of the major problems facing Africa was the "very limited capacity within governments to negotiate good mining contracts especially with multinational companies".
"In most cases, the multinational companies have skilled personnel and negotiators while governments do not. Mining companies may bring consultants, bankers, economists and lawyers to the negotiating table and often outnumber government... teams.
"Access to this many resources, knowledge and expertise too often means that contracts ultimately benefit the mining companies and the government will always get the short end of the stick," the Economic Justice Network's briefing note said.
John Capel of the Bench Marks Foundation told Business Report that while mines might bring in revenue for the government and shareholders, the land on which they operated belonged to communities. "A legal licence does not equal a social licence to operate."
Capel urged mining houses in South Africa to reconsider the way in which they operated.
In the short term, they should review their corporate social investment, which "must be done in-house and not outsourced to so called experts" and should involve consultation with communities.
With regard to wages, Capel said mining houses needed to develop a policy that allowed workers to "justly benefit from their labour and that meets their basic needs".
The mining houses should steadily increase the numbers of local community members and should stop using chiefs and local councillors to recruit.
Capel also urged mining houses to stop actively recruiting "politically connected individuals, senior administrative and government personnel onto company boards or as shareholders". - Ann Crotty
Shabangu: Make CEOs liable for mine deaths
7 February 2012
South Africa's mines minister said on Tuesday that industry chief executives should be held liable for avoidable fatalities, also raising the possibility of court action.
Targeting chief executives would take her safety drive to new levels as the government tries to stem the death toll in the country's mines, the world's deepest and among the most dangerous.
"Fatalities which could have been avoided, we feel that CEOs must be held liable for those accidents, because they are responsible for the operations. As they show interest in how they grow the profits they must also show interest in safety," Susan Shabangu told Reuters in an interview.
Asked if this meant possible court action, she said: "These are some of the issues that we must look at. For me the courts are the last option. But legislation provides for us to go to courts."
Earlier she told the annual African mining conference in Cape Town that the platinum industry's contribution to fatalities in the mining sector remained a "serious concern" and defended safety stoppages which she said had contributed to a drop in accident rates.
South Africa's platinum sector has been battered by oversupply, squeezed margins and an uncertain economic outlook, making producers increasingly vocal about regulatory pressures, particularly the impact of inspections and stoppages as part of the government's zero-harm target.
"The department has been greatly concerned about lack of improvement in compliance and fatalities in the major platinum mines," Shabangu said.
"The platinum sector alone contributes about 30% of all fatalities which remains a serious concern."
The gold sector has also been subject to increased scrutiny and Graham Briggs, chief executive of Harmony Gold Mining Company South Africa's third largest gold producer, described the government's campaign on Monday as punitive. Harmony cut its full-year output target by 13% because of the stoppages.
Shabangu said that there was a slight drop in mining fatalities to 123 in 2011 from 127 in 2010 and that 13 miners have been killed so far this year in South Africa.
She also said in her speech that the ANC had reinforced in a key policy document that nationalisation, long feared by the country's mining industry, was not a viable option.
"I must indicate that we welcome the fact that the report of the ANC task team on nationalisation has reinforced the ANC's earlier decision that nationalisation is not a viable policy for South Africa," she said.
Anglo American chief executive said its platinum unit had lost 100 000 ounces of production last year because of the blanket nature of safety stoppages, which can seen an entire mine shut because of a problem on a single shaft.
Anglo Platinum the world's largest producer of the precious metal, has already said that safety stoppages at its operations more than doubled to 81 last year as part of an industry-wide drive by the government to reduce the death toll in the country's mines.
Cynthia Carroll said in a telephone interview with Reuters that the repercussions rippled beyond the direct reason for the stoppages.
"We would say that over 100 000 ounces were lost and it's not related to the safety issue that was identified. We are going to shut down whole mines and that is the impact," she said on the sidelines of the Mining Indaba.
"There has been an effort on the part of the CEOs to sit down and have conversations with the mining ministry to talk about the approach that has been taken," she said.
Amplats produces around 2.6 million ounces of platinum a year and accounts for over a third of global supply of the precious metal.
Is sustainability just a sideshow at African mining conference?
Keith Slack, Global Program Manager, Extractive Industries, Oxfam America
30 January 2013
Mining industry big-wigs will gather in South Africa next week for Mining Indaba, billed as the "world's largest mining investment conference." As has become de rigeur in recent years at this kind of event, there will be some discussion of social and environmental "sustainability" issues. The final day of the event is in fact devoted to this and boasts an impressive-sounding set of panels featuring mining company CEOs, World Bank executives, government officials, and a smattering of NGOs. This is consistent with a recent spate of mining sector sustainability initiatives including, among several others, the International Council on Mining and Metals'Resource Endowment series, which looked at how mining can contribute more to economic development.
While this attention to sustainability is in general positive, it hasn't driven the fundamental change in industry practice that is urgently needed. US-based Newmont Mining's history in Peru is one example. Following a series of problems in Peru and elsewhere in the mid-2000s, the company commissioned a report that produced recommendations on improving its relationships with local communities. The company's implementation of these recommendations has been spotty at best. Last year it was forced to postpone its massive Mina Conga project in the face of community opposition. In December the company released another damning external review that described a "state of fear" among communities living near the mine. Clearly the learning from past reviews hasn't sunk in with company management.
To address this situation and the critical sustainability challenges facing the mining sector, we offer a few recommendations for the mining execs gathered in in Cape Town to consider as they schmooze, golf, and down some of those delicious South African red wines. (Goats do Roam is my personal favorite.)
Dominic Nyame, a member of the Concerned Citizens Association of Prestea, an organization in southwest Ghana negotiating with a mining company around issues related to air and water pollution, and the proposed expansion of mining operations. Photo: Jeff Deutsch / Oxfam America
First, mining companies need to start fully respecting community consent. While industry rhetoric on this point has improved significantly in recent years (which Oxfam has highlighted in a recent report), good examples of implementation are still lacking. Industry types often make the practice out to be more difficult than it really is and worries about communities vetoing a project are overblown. Newmont's problems at Mina Conga in Peru exist not because communities there are inherently anti-mining. Rather they stem from the company's bungled handling of community relations (by its own admission) during the early days of its presence in the community. Getting these relationships right from the beginning and actively addressing to community concerns are critical to avoiding these problems.
Ensuring respect for the rights of women in the communities where companies operate is also critical for ensuring sustainability. Women are often the guardians of communities' long-term interests. They suffer most directly from the negative impacts of mining, via the domestic violence and alcoholism to which mining often contributes. Mining companies must carry out more rigorous and independent gender impact assessments.
Transparency has become somewhat of a cliché in discussions of sustainability in the extractive industries, but it's an area, like women's rights, where much work still remains to be done. Mining companies should fully disclose all payments they make to governments - down to the project level where their impacts are felt. To its credit, the mining industry hasn't joined the American Petroleum Institute's odious lawsuit seeking to block a new US law requiring these disclosures. This is positive and should be coupled with all companies publicly embracing the law and disclosing this information beginning this year.
The thirsty folks gathered in South Africa will know that there is no sustainability issue more critical to the mining industry than protecting water resources. South Africa itself is awash in acid mine drainage, or sulfuric acid that leaches out of mine sites and destroys ground and surface water. This problem is a ticking time bomb in developing countries and it is incredibly expensive to fix once it starts. Once it does, the acid needs to be treatedforever. Mining companies have the technology now to know when mining in particular ore bodies is likely to cause this problem. They also know they shouldn't mine there.
Finally, if mining companies want to contribute more to sustainable development, they should accept the fact that that may mean reduced profits for themselves. Mining companies are masters at negotiating deals that enable them to avoid paying significant amounts of taxes. In contract negotiations, industry lawyers routinely take under-trained and under-resourced government officials to the cleaners. Yes, companies should be able to make profits, but they shouldn't do so by exploiting unfair advantages.
Ultimately, making progress on these issues will depend on the degree to which mining companies incorporate community consent, the rights of women, transparency, and protection of water resources into their business models. Creating incentives for performance on these issues will be critical. Investors can play a role by only buying shares of companies with independently-verified performance metrics on sustainability, including demonstrable progress on the issues listed above. Companies themselves can link compensation and career advancement to performance on sustainability.
It's time for sustainability to become a central part of mining industry standards in Africa and elsewhere, rather than a sideshow.