MAC: Mines and Communities

The Midweek Essay: Is Rio Tinto becoming a Robo Cop?

Published by MAC on 2019-08-14
Source: Nostromo Research (2019-08-14)

We hereby post this draft chapter of a soon-to-be published new book.

It seeks to address many different issues created by the mining industry's adoption of "cyberisation" of operations, focussing primarily on Rio Tinto.

Is Rio Tinto becoming a Robo Cop?

The threats of Mining Disruption

Nostromo Research

August 2019

It was, for most of this century and virtually all the previous over one hundred and forty years, the earth's largest and most diversified mining company: British-Australian Rio Tinto, variously named RTZ and RTZ-CRA, opting more recently for its original designation.

A forthcoming book will trace the trajectory of the company's exploitation of a specific metal (gold) through a majority-owned subsidiary, PT KEM. in a remote part of the world's third biggest island – and which was to become its biggest dedicated gold mine (1).

It's preceded here by a critical examination of Rio Tinto's vision for its “Mine of the Future”.

Epitomised in a phrase that's lately become a by-word for the mining and other industries, Rio Tinto – and others of its ilk - aims to radically “disrupt” traditional means of digging up and processing parts of our earth for human use (2).

It intends doing so with a series of so-called operational autonomisations, employing digitally-linked and centrally-controlled satellites, drones, robots inter alia.

These are being projected as the most appropriate and economic means to search for, then extract, potentially profitable products of earth that don't easily identify as easily marketable stock-traded assets – like gold.

In effect, one of the world's leading practitioners of technical innovation seeks to take us down radically-changed paths, that are ill-evaluated and mind-blowingly challenging. They threaten highly dangerous outcomes – and, worst of all, may license a host of rights violations and regulatory offenses that only now are being widely addressed as they should be.

++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++

Recently, a conference in Sydney, Australia, organized by media-mogul Aspermont, was entitled the “Future of Mining”, with an agenda framed around determining the following (3):

“DISRUPTION IN MINING: Gain insight into the social, ego-political and economic forces and market trends that have and will continue to reshape the mining industry as we know it today.

INFLUENCING CHANGE: Explore how companies are re-focusing their efforts on creating a united workforce in order to encourage innovation, collaboration and transparency.

VALUE CHAIN OPTIMISATION - A HOLISTIC APPROACH: Learn how the industry is striving towards a sustainable future with the application of new processes, systems and methods of communication.

GAME CHANGING EQUIPMENT: Discover how the latest technology is being applied across the mining life cycle to improve the economics of existing mines and new projects including; remote cameras and sensors, haulage and hybrid loaders and drones.

INNOVATION IN THE SUPPLY CHAIN: Understand what Innovation really means and how companies are taking the industry to new heights with advanced extraction, processing and exploration methods.

BUILDING FROM THE BOTTOM UP: Analyses the future of Manufacturing, Equipment, Technology and Service Companies (METS) and how this multi-billion dollar sector will continue to drive innovation and investment in the sector.

THE HUMAN EFFECT: Deep dive into the process of De-minifying (author's italics) humans from our mines and the challenges facing companies as they reshape their organizations.”

Notice the subtle adaptation of terms which were earlier employed by industry critics to expose mining's failings and implicit denial of opponents' demands: “united workforce”, “sustainable future”, “building from the bottom up”, and quirky use of the phrase “De-minifying” - in this case applied to human beings via the reshaping of organizations now dictated by hi-tech, contract-driven firms such as Caterpillar, Inmarsat, Komatsu, Motion Metrics, MST Global and XAGE Security.

In such a manner, traditional mining is to be transmuted into ciphers which we are supposedly better able to comprehend and adjust to in the first half of the new millennium. The substitution will be through the “ digitization” of data; employment of robots (Rio Tonto claiming it now has the mining world's biggest fleet); and universal human benefits purportedly gained from employing “Artificial Intelligence”.

Significantly, this concept has been refined by financial services firm Deloitte in its recently-published Tracking the Trends 2019: the top 10 issues transforming the future of mining. One of the world's leading financial service agencies sets out three requisite first steps (“horizons”), starting with:

“Assisted intelligence (required human assistance and interpretation (eg Robotic process automation)”, followed by:

“Augmented intelligence: machine learning augments human intelligence”, finishing with:

“Autonomous intelligence” - AI decides and executes autonomously, eg. Fully autonomous vehicles”.

Vamos - a ver?

Investing faith in recent innovatory mining practices, Deloitte hopes these will stimulate fresh investment, instancing Rio Tonto's automated rail and other operating innovations, VAMOS (Viable Alternative Mine Operating system), that would purportedly “learn from each other”.

Alongside this we are promised increased internet and other IT connectivity to underpin “collaborative Eco systems(sic)”, while further features of the “Model mine of the future” would be increased use of solar and other types of renewable power for extraction operations.

Also recommended was introducing “modular smaller exploration modes” - presumably ones that would lessen adverse impacts (and costs) of digging open pits, and avoid creating mine “footprints” (more often the equivalent of flagrant devastation) that can stretch over many hectares .

Under this scenario, miners could theoretically anticipate and forestall appalling events, such as the cataclysmic iron ore dam collapse at Brumadinho in Brazil earlier this year which reportedly took almost three hundred lives.

It also potentially foreshadowed other less controversial, nonetheless troubling (for the industry), developments: resource “nationalization” (eg. by Tanzania); the impacts of punitive tariffs (a la Trump); the consequences of binding legislation against subversive illicit dealing of “conflict minerals”(such as the US Dodd Frank Act); and safeguards imposed against exploitation of a specific material (4)

According to Deloitte, it would be possible to identify growing shareholder opposition to a specific project or company (like Vedanta's failed attempt to mine Nyamgiri in India, or Acacia's avoidance of paying tax in Tanzania?) (5) .

Little guidance, however, was provided by Deloitte as to how such challenging, often highly questionable, intentions would be better served by data digitization than by traditional civil society agitations.

After all, these struggles are already being highlighted by an abundance of NGOs and local community spokespeople.
.
The rocky roads from Rio

Rio's version of the Silicon Valley trope has concentrated so far on the vast plains of Western Australia. Its modus operandi represents “disruption” of past practices under a shiny and seductive guise.


______________________________________________________________

BOX 1: Going off the rails

In 2018, a BHP train in the Pilbara rion ore region of Australia - operated by a single man - took off suddenly when it's driver dismounted to check a carriage in a siding – an ironic version of a “driver less” train.

After reaching 110 kilometers an hour, the vehicle had to be forcibly de-railed, at a cost of several lost days and millions of dollars for the company.

One could argue that this potentially fatal incident merely demonstrates the need to be more thoroughly autonomous, and for BHP to acquire more hi-tech 'savyness'.

Nonetheless, we may well wonder how the world's largest mining corporation couldn't even manage to keep one train “on track”; this incident substantiating the view that half measures never succeed, especially where diligent oversight by human workers might have averted a calamity.

See: http://www.minesandcommunities.org/article.php?a=13852
______________________________________________________________________________

But this must surely should be resisted, since other humanist objectives risk becoming subsumed, threatened, or vanishing altogether, under a fresh regime of mechanized control?

In dire jeopardy are are some vital priorities such as: implementation of community rights to FPIC (Free, Prior and Informed Consent); the urgent need to rehabilitate mine sites and recover land; the requirement to preserve fast-disappearing bio-spheres; the guaranteeing of sustainable community livelihoods; and enhancing workers' adaptation to “alternative” employment via “just transition” (6).

_________________________________________________________________________________________________________________________

BOX 2: The illusion of a fully-automated society


Automation (narcotization and other types of mechanization) always lowers employment, at least in the sectors most immediately affected, and thus increases the reserve army of labor.

This reserve is now global in scope and mechanization occurs everywhere in the world. This reserve puts downward pressure on wages and every other condition of employment, and it generates some new (and old) types of employment that rely heavily on labor (as in service employment and work done from home).

Automation also divides the working class into a tiny elite of scientific workers and everyone else, causing growing wage inequality, which itself impedes labor solidarity. Often enough, just the threat of automation (like the threat of moving operations to other countries) is enough to pressure workers into submission.

Automation, by allowing for greater surveillance of workers and building what was once employee knowledge into the machines themselves, greatly enhances managerial control in the workplace.

At the same time, however, automation may make production more sensitive to disruption, just as complex supply chains and logistics do, but this requires that workers understand this, are organized, and willing to disrupt production.

The irony is that, under a different, socialist system, more sophisticated technology, developed for the people rather than against them, could greatly ease the burden of many kinds of onerous employment and give rise to much shorter working hours. And freedom for each of us to fully develop our capacities.

I might add that profits derive from the exploitation of living labor and not from machines themselves. Given this, the idea of a fully automated society is science fiction. Machines would have to build and program machines! And there would be, in the end, no living labor to exploit. Automation would automatically end capitalism! This is an unlikely scenario”.

Extracted from an interview with Professor Michael Yates, a reputed analyst of labor relations, in Counter Currents (India) May 1 2019.
_________________________________________________________________________

Preluding the cyber age

Early in 2019, BBC Television offered up twenty eight personalities for a public vote on “the Greatest Icon of the 20th Century”. Among candidates selected by a panel of notable television presenters were Pablo Picasso, Ernest Shackleton, Martin Luther King, Nelson Mandela, Muhammad Ali - and even the popular singer David Bowie.

Any one of these might have gained the gilded trophy. Surprisingly, the person who won by popular vote was a certain Alan Turing.

This man was both autistic and gay – the latter “condition” causing persecution, prosecution, hounding and boycotting during much of his later life, and his being expunged from most recorded history of the era.

Why was this apparently mentally-challenged and sexually 'disabled' criminal voted the greatest icon of the last century among such a stellar group of competitors?

It seems it wasn't merely his “queerness” that earned him the prize, but that he conjured up a vital bridge between then-current concepts of human capability and a new era of inter-human discourse.

Turing cracked the cunningly-conceived Nazi “enigma code”, thus potentially saving the lives of many thousands of people. More than any other human being of his day, he foreshadowed the computer as we now know it.

Chris Packham, his TV advocate, argued that Turing used his brilliant mind to do what was until then virtually impossible – developing a “mechanistic” way of interpreting vital intelligence that was hitherto inaccessible. This scientific discovery would never be reversed – nor significantly challenged.

Barrick 's own Turing turn

Among big mining outfits, Barrick Gold – until 2018, the world's largest gold extraction corporation – was likely the first to broach publicly the virtues of artificial intelligence in transforming itself before a general audience (7).

“The challenge is to move from thinking of [mining] as a series of tasks to a sort of self-perpetuating machine which becomes the culture. You move — to make it slightly dramatic — from being a mining company, to being a digital company that happens to be in mining.”

That's how the company - one of  the most destructive and pilloried miners anywhere - aimed to revamp itself, trying to "drag gold mining into the 21st century" (sic) and squeeze "every cent of value" from it.

Barrick's COO (Chief Operating Officer) Richard Williams says he learned the technique while working for the British SAS (Special Air Services) in Iraq, where “electronic penetration allowed commanders to view the entire battle space for the first time" (8).

Accompanying this disturbing spectre came promise of environmental improvements - dispensing with cyanide-leaching, or automating underground operations to spare workers from injury or death from underground explosions and rockfalls.

To the question whether this wouldn't inevitably result in a marked loss of traditional jobs, Williams claimed that employees would simply be re-trained in new modes of "digitization" aimed  to "process increasingly complex ore". (Deloitte recognized this prospect might be threatened by historical labor-led campaigns for dignity and security) (9) .

The language used by Barrick to sell its prototype of the future seemed clearly aimed at appealing to males of a certain age and propensity (10).
More importantly,how would Barrick counteract the impacts of  dodgy, often illegal,  practices, that can't be addressed by the click of a button or  the overflight of a drone - and no matter how many robots are readied to clean up the mess? (11).

Whatever was intended by its statement, Barrick clearly wanted to cause a step-change in public consciousness, which the late Canadian philosopher Marshall McLuhan would doubtless have relished exposing in his treatments of "the medium as the message".

Not only did Barrick seek to redefine the nature of mining, it was also mediating a new exculpatory culture - seeking to wipe out long-standing perceptions of itself as a brash, destructive, entity that will inevitably continue destroying community livelihoods, and depleting bio-diversity.
"Don't lay such charges at our door", it may well protest: "We're now a digital player that just happens to be digging up the earth in ways unimaginable a few years ago".

The flaw in this argument, of course, is that there will always be many – not just from civil society but also governments - who know very well what Barrick is up to: a leopard doesn't change its spots, simply by seeking to disguise its predatory intentions. Proudly posturing in “new” clothes, the emperor would rightly remain as naked as ever.

In fact, this purportedly ground-breaking initiative, by a company that had long chalked-up an invidious record of real earth break-up and community dislocation, wasn't developed. By the end of 2018, its leading lights were forced by indebtedness and greed into merging their dubious assets with Britain's Randgold.

All the rhetoric, voiced merely a year or so previously, has apparently disappeared in a puff of idle self-inflation.

Clearly, Barrack's intentions were about to give way to the real world: one encapsulated in a junior company that learned how to dispense mining in a traditional fashion, where human beings could not be substituted by machinery (12).

Advocating Disruption or plunging into Dystopia?.

Let's contrast Barrack's temporary demise – and its corporate withdrawal from Toronto – with Rio Tinto's own debt-induced problems during recent times.

The British-Australian mogul has always been a unique beast in mining's menagerie – highly diversified, and dependent on investments in “bullish” sectors when more “bearish” or failing ones loomed on the horizon.

The company may safely say that its recent digitally-run adoptions owe little or nothing to the warped modes proposed two years ago by its Canadian cousin; their's are more sophisticated, technically-honed and better presented for the “gig economy”.

A quick glance over the byzantine-like corporate architecture of Rio Tinto, founded on its 19th century origins and built up through the 20th century, exemplifies a company that cherishes bold acquisitions, risk-taking strategies (such as opening deep-water Lihir gold mine in a volcanic caldera); and above all a “readiness to go where no man has gone before” - specifically onto Indigenous territory (13).

From 2008 until today the company has secured pivotal investment from China's state-owned aluminum producer Chinalco, despite heavy indictments for corruption, leading to stiff prison sentences for Rio Tinto top employees in 2011 (14).

Over some decades it has “hand-shaken” with prominent politicians and law makers in several countries (not merely Britain and Australia, but also in the USA, Aotearoa/ New Zealand. Ecuador, Papua New Guinea, Namibia, Chile, Ecuador and elsewhere).

It enjoys a continuing close relationship with the United Nations, and the London-based ICCM (International Council on Mining & Metals) - having conceived, then helped pilot this body from its formation to the present (15).

Several NGOs which advocate reform in areas implicitly antipathetic to mining ( Human Rights Watch, WWF, Conservation International, among them) have at different times, and in various forms, done deals with the company.

Nor should we ignore Rio Tinto's adept, sometimes secretive, manoeuvres, seeking to bend academia itself to its ear by establishing University departments, and bankrolling august “ivory towers” (16)

However, within the past two decades, Rio Tinto has also re-forged its avowed intentions; substituting former self-aggrandisement for the more attractive one of providing metals for all citizens of the world : initially exploring these concepts with the policy statement “The Way we Work”, then following this by its “Four Principles” (17)

Nonetheless, the fundamental question must be: how can eminently human objectives feature as principle elements in the social transformation now required to carry us from our current human-directed Anthropocentric era to that of the Symbiotic (as one thinker has labeled it), with all that entails?

Rio Tinto's expectations may well crumble in the face of campaigns by labor forces, and wider fears of de-humanisation created by these new “ways of working” - let alone the addictive power of fresh, often untried, technology on future generations (alongside false bio-metrical equation of social cohesion with “social media”).

Above all, how can rapidly evolving strategies of Blockchain investment – techniques to generate and centralise vast databases to record and verify financial transactions - operate to any common human “good”?

Theoretically, they may satisfy such demands as those legislated for under the USA Dodd Frank Act, and the Kimberly Protocol on “conflict minerals; they might also identify vital, difficult-to-locate minerals (especially rare earth elements to serve the new wave of electric energy output) as well as anticipating impending cost fluctuations in the market.

But, how do such self-motivated data-banks ultimately satisfy anyone - other than greed-driven profit-takers and predominantly fossil-fueled energy companies now riding high, if only by what's required to get these ventures up and keep them running?

Building Block chains – mind-blowing gambits!

Or simply blockheads enmeshed in algorithms to outwit cryptographers?

By employing algorithmic wizardry, our contemporary cyber elites seek to juggle and jiggle a huge range of numbers in the quickest possible time, keeping micro-seconds ahead of other profiteers, whether through buying bit coins or securing contracts coveted by rival wheeler-dealers (18).

Deloitte reports that Goldcorp has begun using these devices to make sales directly to dealers and banks. Thus, it claims, the companies can “disrupt the downstream value chain, “...raising the prospect “ of complete mines or smaller units being tokenised (digitally of course), enabling them to be traded, and boosting liquidity far in advance of actual production” (19)

That appears to be an open invitation for miners to acquire, explore and drill even more indigenous and community territories than they do at present.

However, the financial services' agency goes even further, asking: “Is there a version [sic] for mining where companies sell their technical know-how and data as a service rather than owning the underlying assets and infrastructure? [author's italics]” .

If so, then going down this route arguably foreshadows even worse shirking by companies of their ESG (Environmental, Social and Governance) obligations and ethical assertions, than currently prevails (20).

_______________________________________________________________________________

BOX 3: The three greatest threats to Indigenous Peoples

In an interview given to the London Guardian on 9 August 2017 ,the UN Special Rapporteur on the Rights of Indigenous Peoples, Vicki Tauli Corpus,identified the biggest current and future threats to Indigenous Peoples. These are:“extraction industries, conservation projects and climate change” - the latter two manifestly intimately associated with mining.

“Conservation” is both directly endangered, or under-mined , by ill-judged compensatory schemes, typified with “bio off-setting” initiatives and “land swaps, as advocated and practiced by Rio Tinto in Arizona, Madagascar and elsewhere.

“Climate change” is demonstrably linked to fossil fuel addiction, especially coal, as well as through mining's own direct contribution to GGE (Global Greenhouse Gas Emissions).

Says Ms Corpus: “Secure land rights for Indigenous Peoples is a proven climate change solution, and denying [their] land rights and self-determination is a threat the world's remaining forests and biodiversity. It Is also a primary cause of poverty.”

See: HTTP://intercommunication/antiparticle?a=13960
________________________________________________________________________________

A confusing mix of do's, dont's – and let it be's

Ernst&Young, another global financial services agency, relies upon intelligence from top-ranking mining personnel to determine risks faced by their sector – and it has done so for some years in common with PricewaterhouseCoopers (PwC) and Deloitte.

Nonetheless, in one important respect, Ernst&Young recently proved an exception to its fellow institutions, elevating “Gaining a Social License to operate (SLO)” to the top of its concerns, while this has now slid - almost completely - from the list of predictions and auditing mechanisms of the other two (21).

Last year, PwC in Mine2018: Tempting Times, ranked the risks deriving from “Public perception/ license to operate” as last in line for what the industry is, and ought to be, concerned about.

The firm did recognize that: ”In many regions, across both developed and developing economies, local communities remain vehemently opposed to mining activities, and continue to demonstrate their opposition through refusals to negotiate, lockouts, protests, and outright violence” (22)

And, in an earlier report : Tracking the trends 2016: The top ten issues mining companies will face in the coming year, Deloitte also asked the critical question: “Do we need new mining approaches? Is the traditional profit model shifting?”

But, instead of addressing citizen and community opposition to mining head-on, these two agencies seem to have now demoted the necessity that practitioners gain SLOs to a brief aside; investing faith in digitization as a key means for the industry to regain credibility and thus stimulate fresh investment.

Moreover, one of its solutions to these troubles and travails gets boiled down to “transforming [these] business enterprises into social enterprises” and requiring miners “to listen more closely to determine what stakeholders truly want, and then to shift their operational processes in response”.

In other words ( we might conclude), communities and others are being induced to adopt a procession of endless talks and “negotiations” around nugatory objectives; denying them any substantive influence over outcomes - while the supposedly “real” work goes on or is only marginally impacted.

Crucially, Indigenous Peoples' right to enforce FPIC is being consistently substituted for the fig leaf of “Consultation” (23).

 

______________________________________________________________________

BOX 4: Ernst & Young - kick starting the SLO trope

Ernst & Young has raised the necessity of gaining a Social License to Operate (SLO) from 7th among the 10 risks identified in its 2017-18 report, to number 1 in its publication late last year, where it states:

“There is more information, bigger platforms and more at stake than ever before. Underestimating the power of even a single stakeholder would be a mistake.

“The sector needs to redefine its image as a sustainable and responsible source of the world’s minerals”.

Such may be welcome news for those at the sharp end of the shovels, promising a marked change in regulatory control and providing critics and communities with fresh campaigning weapons, laid down in ILO 269, and legislated for by the United Nations.

Once again, Rio Tinto has appearws to set a precedent, theoretically recognizing this right, but in practice paying it little more than lip service (as it did indeed at PT KEM in Indonesia).
________________________________________________________________________________

Backs to the future

Derogating something that, for years, many communities have campaigned to be endorsed in international law and domestic legislation, currently appears no longer a necessity for some of the most virulent and often violent corporate offenders of the precept.

It's one which translates on an almost daily basis into mounting atrocities and violent acts committed against human rights defenders – in countries such as the Philippines, Chile, Mexico, Honduras and India.

Does this mean the mining industry - at least its most powerful practitioners - have somehow turned back the corporate clocks, concluding that time-dishonored methods to acquire land, exploit labor, and prosper in rapidly fluctuating markets, have once again become acceptable?

Actually, there's no evidence of this yet happening - at least among the most prominent, highly-capitalized and geographically-extended companies.

Rather, there has been a confusing mixture of corporate policy and project targeting. Rhetorical allegiance to the Human Rights Protocol, and the UN SDG (Sustainable Development Goals) ]sits alongside often flagrant flagrant disregard for the fundamentals of corporate sustainable livelihoods.

While unforeseen disasters (like the Brumadinho dam collapse in Brazil) are universally condemned, incidental mis-management is overlooked amid internal quests to cost-cut, and with fast-growing shareholder demands for increased dividend returns. (Some investors have apparently now become disenchanted with companies' weak financial performance, broken promises, and their general “precocity”).

True, some companies have dispensed with promoting ocean bed mining and riverine waste disposal. However others, like Placer, continue to benefit from such practices, thus cutting completely through principles of “doing no harm” and that “the polluter must pay” (24).

Thus the Tier-One miners remain content to consign their industry's most egregious abuses to junior or subsidiary companies, while continuing (and in some instances deepening) their reliance on these smaller enterprises; it's a type of “moral displacement” which has admittedly long featured on their radars in one form or another (25).
________________________________________________________________________________

BOX 5: Investor shake-ups

Canada's Financial Post remarked in January 2019: “As mining companies have encountered trouble raising money on the public markets, private equity companies have stepped-up their game. One of the largest transactions in 2018 was the U.S.-based Orion Resource Partners LP, a private equity company, taking Dalradian Resources in a $427 million transaction” (26)

In other words, the merger between financial speculation outfits has assumed heightened importance in the mining sphere.

Dependence on performing mergers and acquisitions (M&As) may have dropped off most mining company priority lists. Nonetheless, transformations in the gold sector have taken place, presaging a major shift in mining capital - thus oversight - from Canada, to the UK and the USA.

The Financial Post comments: “For some gold companies, less is more... investors seem to be rewarding firms that scrap projects”, noting that “Colorado Gold and Marigold both shelved projects this week, sending stock prices soaring” (27).

_______________________________________________________________________________________________________

Rio Tinto in contention

A tactic of quitting projects and banking on a rise in the share price due to market scarcities  has been at the forefront of Rio Tonto's overall strategy for a long time; its ascendancy in iron output secured at the expense of Vale's recent disasters, for instance. In a real sense these vagaries have determined Rio Tinto's “Way We Work” and seem to owe little to purely digital wizardry, either by way of foreseeing a trend or, indeed, pre-empting one.

Let's examine in some detail how Rio Tonto is currently contending with these issues, as reflected at its March 20I9 British shareholders annual general meeting (AGM).

Most of this gathering passed (perhaps surprisingly to dissenting shareholders) with little adverse argument.

“Aren't we all in this together?” appeared to be the company's order of the day: ”We've dispensed with coal, sold our largest uranium mine, brokered a ground-breaking climate deal, and are ahead of the field in safe- guarding against tailings' risks”. And, at the Rio Tonto Ltd AGM, held a month later in Australia, the CEO J-S Jacques announced it had closed the Kenneth coal-fired power station in Utah,

Neither company chair, Simon Thompson, nor J-S Jacques, came anywhere near professing high industry standards, or satisfying broader protocols.

First, British Rio Tinto merely handed-over questions about the toll of the company's 'type three' greenhouse gas emissions to its Australian associate. At the Australian AGM, hosted on Aboriginal country in Perth on May 10, 2019, shareholders were in fact urged by the board to reject the resolution aimed at counteracting such emissions (Resolution 19).

A recently-forged alliance between Rio Tinto, Alcoa and other aluminum manufacturers, to cap greenhouse gases, appears to be a step forward. Nonetheless., we shouldn't discount the uniquely egregious impacts of mining and processing this “green” metal, and continuing to dig up masses of bauxite; refining it at enormous electricity consumption costs; leaving behind mountains of potentially toxic wastes.

In dealing with the persistent dangers of tailings dam collapses, J-S Jacques went little beyond acknowledging the enormous regulatory tasks lying ahead. No comprehensive independent survey of Rio Tinto's more than a hundred such installations had yet been published, while the company seemed little concerned about three of these (Bougainville, Kelian and Grasberg) since it has withdrawn responsibility for maintaining them.

Not only did the CEO fail to admit that the impervious and secure dam, promised earlier at the QMM mineral sand operations in southern Madagascar, had been cunningly metamorphosed into a simple “berm” (a merely earthen bank). He also ignored the crucial question of how neighboring communities will access clean water, as opposed to suffering from dirty floods and similar contaminating incursions.

Tailings between the legs

Although clearly much exercised to escape from Rio Tinto's dim, dingy, and often delinquent recent past record, its directors arguably only succeeded in confirming it hadn't achieved success.

The company still seems unable to admit that formerly-controlled bad operations could have been relinquished, sold, or drastically modified, had the board the guts to do so .

Simon Thompson tried discounting any responsibility for the huge financial and moral legacy of Indonesia's catastrophically damaging  Grasberg mine in West Papua, arguing the government had now taken up the leash.

Apparently there was no contradiction between Rio Tinto's stated policy (some years old) of refusing to be involved in any extraction venture employing riverine tailings disposal, and its highly-belated forsaking of the Grasberg joint venture (JV) only when Indonesia authorities ordered it to do so (28).

Shades of Albanese

One shareholder rose to ask the chairman how Rio Tinto would respond to a recent US Court decision that it answer accusations, made in early 2018 by the Securities and Exchange Commission (SEC) in addition to its Australian equivalent (ASIC), that it failed to report major losses to investors on buying the Riversdale mine in Mozambique (29).

Thompson settled for two patent untruths; the first being that this matter had been fully addressed at the previous year's AGM ( it had certainly not been). The second was that former CEO Tom Albanese had no involvement in any scam from Rio's point of view.

This was a shabby attempt at dissociating Albanese from his undoubtedly advantageous role in advancing the company's profiteering at a time when fortune-making most counted for the firm.

As has been revealed repeatedly (on the MAC website), Rio Tinto has never divulged the full details of how Mr Albanese enabled the company to implement one of its most stupendous coups - acquisition of the stupendously rich Oyu Tolgoi copper venture in Mongolia from Ivanhoe Mines - even while this Canadian company was violating embargoes against Burma, and raking-in crucial monies from Rio Tinto. (30)

At root, most of these practices – dubious at best, quasi-criminal at worst - could well have been averted or promptly corrected, had the company stringently observed objections made by its inaccurately-labeled “stakeholders” and, principally, Indigenous communities on whom the company is predominantly dependent across the world.

Not only do these groups and peoples reside close, or closer, to mineral resources coveted by Rio Tinto, than virtually any other mining company.

Communities are also the premier agencies concerned with safeguarding economic, cultural,. social and environmental values put in jeopardy.

These peoples militantly defend their livelihoods against the various mechanisms employed by the mining industry to disturb – in some cases rob them  of - the “ symbiosis” between all of us and the natural world.

In this context, the somewhat simplistic, often abrogated “Social License to operate”, has been substituted for the much clearer demand that Free, Prior and Informed Consent (FPIC), is central to determining what, how, and by whom, mining takes place (31)

So, let's firmly put into the dustbin cryptic algorithmic strategies, conjured up to inhibit this!
_____________________________________________________________________________

BOX 6: Inverting the power imbalance in granting true community consent

There's a compelling case that Free, Prior and Informed Consent (FPIC) should be recast as a community's (not just an indigenous one's) legal right to refuse “consent”, after it has examined all available data (including that of companies, investors and governments) on a proposed project.

Decision-making powers seem to have reverted to (and been concertedly perverted by) actors who are much more powerful than their adversaries to whom this right was initially given; encouraging a legerdemain (sleight of hand) by miners and administrations (as in Peru and Australia, to cite just two countries).

While governments may claim to observe FPIC, they customarily only permit negotiations with certain selected community representatives, or allow discussions to the point at which their members no longer have control of the proceedings.

Tom Albanese, CEO of Rio Tinto and then Vedanta, when challenged on the right to FPIC at a Vedanta AGM stated: “We recognize FPIC, as the right to re-negotiate [our italics] terms if a community has problems.”

The role of dissenting community members had already been switched from their being recognized as “shareholders” into being arbitrarily designated as “stakeholders”

If a community actually has the right to determine what it does with its own territory, and how it manages its own resources, a new concept of “The Right to Propose or deny a project after [my italics] a Full Process of being Informed” should be instituted.

Only thus will the present imbalance of power between the negotiating “parties” be inverted.

For a blow-by-blow examination of the bureaucratic-institutional/corporate subversion of FPIC as it stands in India, where the Forest Rights Act (FRA) guaranteed a community right to implement the legislation, see:

Manufacturing consent: http://www.minesandcommunities.org/article.phpa=13999

____________________________________________________________________________

FOOTNOTES

(1) Another London-listed company, Anglo American, has likewise set out its model for “Future Smart Mining” with the objective of promoting “sustainability”.“Disruption” is a term conceived in the depths of California's Silicon Valley which elected the “garage as the womb of new ideas”, to quote KPC [6 August 2017]; in other words, new ways of working, getting rid of “previous...systems”.

(2) In May this year, the Sambhavanaa Institute, located in India's state of Madhya Pradesh hosted a conference entitled “Digital Colonization 2.0”, to examine “How digitization is undermining the economy, democracy and sovereignty”. It said: “We are living in a world where digital technologies seem to be replacing or getting added to the processes for social, economic and political transactions. While those without digital access or literacy may get excluded, others are finding that their access to social, economic and political interactions has become colonized by those who regulate the ecosystems of these digital technologies.

“Not only are their identities no longer in their control or possession, their existence has now become a digital footprint that is at the mercy of those who have appropriated their personal and other information which they may not be comfortable in sharing. Civil death by digital is as much a reality as is....money laundering”.

(3) See: https://australia.future-of-mining.com

(4) Formerly this bad product was primarily lead, due to it toxic, carcinogenic properties, and now, on many civil society agendas, extends to asbestos, uranium and silicon. The DR Congo is a key source of so-called “conflict minerals”-  tin, tungsten, tantalum with the addition of gold. Now coal (of course) is increasingly being “sent to Coventry” by an assortment of governments and investors .

(5) Tracking the Trends, pps 11-14

(6) A glaring example of highly profitable “disruption” (for some) is Uber transport – common to India, Indonesia and elsewhere - whose vision is “getting away from people driving their own cars” on a daily basis. It's something that has incensed numerous taxi drivers, and alarmed those who maintain that the only solution to the proliferation of private driving is a combination of reducing road use, or at least sharing trips; something which purportedly saves in fuel and prevents pollution. For further coverage, see: Money Week, 17 May 2019

(7) Bloomberg 10 October 2017

(8) Tracking the Trends, p.22

(9) Tracking the Trends

(10) It's tempting  to speculate that Barrick had been handing out free Play Stations to its workforce,  aware that their children would ( so eagerly) clamor to meet the combative challenges of versions of sick  US war games like "Call to Duty

(11) For details, see MAC's : Tanzania: Barrick blasted for multiple offences 

(12) Unfortunately, the appointment of Barrick's new CEO - Randgold's British counterpart, Mark Bristol - has failed to address a raft of the Canadian company's on-the ground human rights violations, especially against women at operations in Papua New Guinea and Tanzania See: http://www.minesandcommunities.org/article.php?a=13884

(13) see Plunder! Presented by a global network of people opposed to the activities of the the RTZ corporation,text by Roger Moody, published by Partizans/Cafca, London and Christchurch, 1991

(14) see: http://www.minesandcommunities.org/article.php?a=10888]

(15) see: R Moody, “Rocks and Hard Places: The Globalization of Mining”, Zed Books, London 2007

(16) See: Extracting Intellects: http://intercommunication/antiparticle?a=6500

(17) see https://www.riotinto.com/aboutus/strategy-5006.aspx.

(18) Blockchains , aka Distributed Ledger Technology (DLT), derived from and underpinned the invention of bit coins. They have been critiqued by a number of authorities (and users). Some analysts, such as Larry Lehman ofThe Corner House, have convincingly demolished the precept. Others, like Andrew Whitmore of Mines and Communities (MAC) generally find qualified favour for in them [See Briefing paper for Debate, Coining industry and new technologies, 2018] . Others, are much more skeptical, believing that their promotion thrusts us into a world that's impervious to democratic control at all levels - and threatens existing guarantees of privacy. Kodak in January 2019 unveiled its “Kodak Kashminer” (sic), seeking to sell bitcoin block chains powered by its own coal-fired plant. One financial journalist commented: “This looks more like kleptomania than the return of Kodak” [Money Week, 19 January 2018].

(19 )“How can we create enough trust between transacting parties peacefully to exchange things of value?” asked Simon Wilson of Money Week [Money Week 8 February 2019] . He says the need for a decentralized ledger system was supposed to eliminate the requirement of a centralized government authority and presumably without regulating the limitations, capacity or accountability of a new regime. Indeed many firms such as financial services agencies ( PwC, Citigroup, ABN Afro, Society General, et al) and energy providers ( eg. Royal Dutch Shell, Monrovia, Guvnor) now uncritically support the innovation.

(20) Tracking the trends, ibid.

(21) Top Ten business risks facing mining and metals 2019-2020, December 2018; see also: http://www.minesandcommunities.org/article.php?a=13964; see also BOX-6.

(22) Conflating the two concepts was evidenced just after Rio Tinto's 2019 annual general meeting, when Stephen McIntosh, Group Executive for Growth and Innovation, was challenged by Richard Solly of the London Mining Network over an earlier involvement by the company in the Trinidad area of Chile.

According to Richard Solly: “[McIntosh] told me that Rio Tinto had indeed been involved with exploration in the...area but had pulled out of it in, he thought, December....I said that local indigenous communities were angry at the lack of consultation with them according to Chilean law, let alone respect for Free Prior Informed Consent (FPIC) under the UN Declaration on the Rights of Indigenous People.

“ He said he knew nothing of protests against Rio Tinto and thought that they may have been directed against one of the other companies exploring in the area...He said that a number of companies were exploring but that because Rio Tinto had the most well-known name it could be that people assumed that work being done by others was being done by Rio Tinto. He said that Rio Tinto would not go ahead with a project without proper consultation with indigenous people as the company takes FPIC very seriously”.

23) See BOX-6

24) BHP sold its co-ownership of the huge Ok Tedi mine in Papua New Guinea in 2002, voicing condemnation of the practice of dumping wastes into the river, although it devolved much of its responsibility for combating consequent devastation onto a separate entity. Rio Tinto abnegated the practice some years later, while continuing to be implicated in its use by Freeport McMoran at the Grasberg mine in Indonesia (see below). Anglo American withdrew from the world's first deep-sea mining venture, that of Nautilus Minerals, in summer 2018 (http://www.minesandcommunities.org/article.php?a=13664

(25) Complex and intensively-created historical manoeuvres by Anglo American were intended to disguise its crucial backing for apartheid regimes in South Africa, through a host of indirect or directly-owned outfits. Anglo-De Beers, the world's biggest diamond miner miner and marketeer – is perhaps the signal case in point, and the subject of several important critical works, such as Glitter & Greed: The secret world of the diamond cartel, by Janine Roberts, Disinformation Company, New York 2003.

(26) Financial Post, 29 January 2019. For more recent news on Dalradian's Irish operations, see: http://www.minesandcommunities.org/article.php?a=13997I

(27) Gabriel Friedman, Financial Post, February 1, 2019

(28) This was a fully-fledged joint venture partnership between Rio Tinto and Freeport MacMoran, which is why the Norwegian Council on Ethics successfully recommended throwing both companies off the government's global financial portfolio in 2007, reconfirming the ruling against Rio Tinto ten years later:see:  Norwegian govt pension fund updates banned companies list

(29) see: Rio Tinto finally accused of misleading investor

(30)See, inter alia:  Amnesty calls for investigation of Canadian company role in Burma .

______________________________________________________________________________

This paper is based on a keynote address delivered at the 7th Annual Congress of mines, minerals & People (mm&P) India) in March 2019

 

Home | About Us | Companies | Countries | Minerals | Contact Us
© Mines and Communities 2013. Web site by Zippy Info