MAC: Mines and Communities

Communities take shine off platinum players in South Africa's Bushveld

Published by MAC on 2006-05-19

Communities take shine off platinum players in South Africa's Bushveld

19th May 2006

This article is authored by Richard Spoor, a highly respected South African activist lawyer who has taken on mining companies and won some significant court victories. The last time we featured him on MAC was in March, following the setting up of a compensation fund for asbestos victims of Eternit. This is the company, operated for many years by the Schmidheiny family, whose Stephan Schmidheiny founded the Business (later World Business) Council for Sustainable Development in 1992.

Traditional leaders spearheading South African resistance against Anglo Platinum

Sunday Independent

19th May 2006

The Bushveld Mineral Complex contains one of the richest ore deposits on Earth. The reserves of chromium, platinum, palladium, osmium, iridium, rhodium, and ruthenium are the world's largest along with vast quantities of iron, tin, titanium, and vanadium.

It is over 67,000 km2 in extent, an area the size of Ireland. It extends from Rustenburg in the West through Mokopane, in the North to Lydenburg in the East.

The origin of the complex has been attributed to a vast surface volcanic flow considered to be a result of a huge meteorite impact some 1.9 billion years ago.

The complex is the scene of the largest mining investment boom in South Africa since the opening of the Free State goldfields in the 1950's.

Much of the land is occupied by Setswana and Sipedi speaking people who live in accordance with their indigenous law and custom. Nominally the land belongs to the State which holds the land in trust for the inhabitants.

Technology and markets conspired to prevent the effective exploitation of the resource until the last 10 or 15 years. Impala Platinum( Implats) were one of the first to sign agreements with the Bophutatswana government to begin mining on tribal land in Rustenburg. Post 1994 the Bafokeng tribe launched court proceedings to claim the royalties Implats had contracted to pay Mangope's government. Their claim was based on the fact that the mineral rights belonged to them and not to the state. Implats and the Government were forced to concede and the Bafokeng made a settlement with the mining giant that made them the richest tribe in South Africa.

In the Lebowa homeland the mineral rights were placed in trust with the Lebowa Minerals Trust (LMT) for the benefit of the Bapedi nation. Anglo Platinum (Amplats) was able to secure the rights to 24 of the most valuable farms on favourable terms.

In the late 1990's a legal attack was launched to set aside the agreement between Amplats and the LMT. The attack was funded by private investors. The case was ostensibly brought in the interests of the Bapedi people, who it was alleged had been prejudiced by the deal between LMT and Amplats.

The sting was taken out of the legal challenge when Amplats settled its differences with the investors who were given the opportunity to acquire the mineral rights in the Farm Winnaarshoek for some 26 million rand. The new owners, Trojan mining, raised money for exploration on the Canadian bourse and on completion of same sold their rights to Implats for a profit of some R900 million. This profit was turned in a period of some 18 months. Without adequate its original backers, the litigation against LMT and Amplats floundered and the case was eventually dismissed.

As part of an overall settlement between the State and Amplats and a handful of other influential players Amplats agreed to give up its rights to half its 24 farms to be redistributed by the Government, to BEE companies. Amplats and Implats also agreed to consolidate their interests in through a series of land swaps and partnerships. Amplats took on board Patrice Motsepe's ARM and Implats chose to partner his sister and Minister Geoff Radebe's wife Bridget's Makau Mining.

These developments coincided with a major reform of the law on mining rights. The Mineral and Petroleum Resources Development Act, Act 28 of 2002, abolished mineral rights and vested the right to award mining rights in the Minister of Minerals and Energy. Contrary to popular belief the reform suited both the government and the big mining companies and especially those with an interest in mining in the Bushveld Mineral Complex, such as the two biggest platinum mining companies in the world Amplats and Implats.

Not only did the transitional arrangements provided for in the act, effectively secure for the mining companies the value of their old order mineral rights, it also eliminated the threat posed by the Bafokeng precedent that might have obliged them to pay royalties and a sizeable proportion of their profit to the holders of indigenous land rights.

With the abolition of mineral rights the indigenous communities for whose benefit they were held by the State lost their chance of securing an equitable stake in the proceeds of mining undertaken on their land as the Bafokeng had done. Between them the state and big mining had ensured that there would be no mining windfall for any of the other indigenous peoples living on the Bushveld mineral Complex.

This expropriation of indigenous peoples land rights by the State was justified on the basis that the countries mineral wealth belongs to all its peoples and not just to those lucky few who by an accident of history happen to to live right on top of one of the largest storehouses of value in the world.

Of course mining like all extractive industries exacts a heavy cost from the environment and not all South Africans share those costs. That cost is borne primarily by the unlucky few who by an accident of history happen to live right on top of one of the largest storehouses of value in the world.

The impact of mining on indigenous communities is devastating. It destroys their land, their way of life, their culture, their identity and their dignity. Mining finds them as poor but dignified and substantially self sufficient peoples and turns them into landless rural slum dwellers. It prostitutes their daughters and turns their sons into criminals.

Modern mining is hugely capital intensive only few people are employed and most of those are highly skilled. Local people cannot compete for the few jobs on offer and as such they derive little benefit.

The governments seeks to ameliorate these consequences by requiring mining companies to have a social and labour plan in place and an environmental management plan. Mainly these measures appear to involve the building of large and expensive road signs advertising the companies nominal contribution to the cost of building a new primary school classroom and dampening down the dust generated by giant mine trucks as they race through the village.

What little good might be achieved through the trickle down and other processes associated with investment in mining is overwhelmed by the cost and harm suffered by indigenous communities through the loss of their land, damage to houses caused by blasting, the destruction of their ground water resources through dewatering and the collapse of their social order. Indigenous communities are overwhelmingly impoverished by mining activities carried out on their land.

The mines obtain access to the communities land for free or at nominal cost. Amplats' Modikwa mine, pays nothing to the Maandagshoek community. Their PPL mine, which generates revenues in excess of R 2 billion each year pays less than R3000 per month to the Langa tribe. They also have the right to destroy peasant farmers crops without compensation should the need arise. Implats pays the peasant farmers who have lost their land to its Maroela mine a few hundred rand per annum.

The mining companies pay shyster lawyers, politicians and government officials to facilitate agreements with communities. Cash, lucrative sub contracts, BEE shares and 4X4 pickups are the favoured incentives.

Traditional leaders who don't play ball and who refuse to compromise their communities rights are threatened, excluded from any beneficail participation in the mine and often find the mine endorsing and supporting rivals to the traditional leadership. BEE partners like ARM and Makau are given responsibility to manage the local native problem on their senior partners behalf.

Things may be changing; 26 families at Ga Pila near Mokopane, who refused to be relocated have threatened legal action against Amplats to restore water and electricity cut off by the mine after it demolished their village, fenced them out of their land, had them arrested for cultivating their land.

The Maandagshoek community has overcome deep and long standing disputes over the traditional leadership in order to stand united against the predations of Amplats and ARM. This in the face of threats by politicians and policeman and a massive campaign to co-opt the community leadership. A culture of resistance is also developing at the neighbouring Maroela mine which is owned by Implats. Strong alliances are being forged between traditional leaders across Sekhukhuneland.

At PPL three communities have approached the high court for an order to stop mining on their lands.

Regretably the DME and DLA remain implacably hostile to community activism on the land rights issue and no help or assistance is forthcoming from those quarters.

The Land Claims Commission which prosecutes restitution claims against white farmers with vigour and enthusiasm is strangely reluctant to prosecute claims against ARMs Modikwa and Two Rivers Platinum mines.

Nevertheless a new and vibrant activism is emerging led by traditional leaders with integrity. They are winning increasing support from their constituents who see in them the hope of a better and more dignified future for their communities.

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