BHPBilliton: giving with one hand, taking with the otherPublished by MAC on 2006-02-17
BHPBilliton: giving with one hand, taking with the other
17th February 2006
The world's biggest mining company can't seem to overcome scepticism that its two hundred thousand dollars largesse in India may have self-serving motives.
Perhaps this is not surprising considering that, according to the Chilean government, the company and its partners (Rio Tinto, Mitsubishi, the World Bank/IFC), owes it much, much more in unpaid royalties
Orissa NGO takes BHP-Billiton money
by Biswajit Mohanty, Business Standard
The India Development Foundation launched by mining giant BHP Billiton of Australia has announced its plan to support the work of Gram Vikas, the community development organisation located in Berhampur, Orissa.
An agreement to this effect has been signed between the two parties.
The one-year project will support 2,000 families in approximately 25 villages in the districts of Ganjam, Gajapati, Nayagarh, Mayurbhanj and Keonjhar to establish community managed water supply and sanitation systems.
The Foundation is providing $202,000 dollar (Rs 90 lakh) to the project.
The Foundation aims to contribute to India's education, health and rural development across all its states.
M S Ramachandran, chairman of the BHP Billiton India Development Foundation, said.
The Foundation, which has an initial budget of Rs 13 crore ($3 million) over three years, had been established to invest in India's human and social capabilities, in line with BHP Billiton's commitment to global social responsibility and sustainability.
The Foundation is modelled on other foundations established by BHP Billiton around the world, including the Escondida Foundation in Chile and the Mozal Community Development Trust in Mozambique.
BHP Billiton has won several international awards for its commitment to the community.
Ramachandran said the Foundation enabled BHP Billiton to provide a valuable legacy that transcended mining activities, effectively contributing towards social development at local and state level.
Gram Vikas has been working with poor and marginalised communities of Orissa since 1979 to make sustainable improvements in their quality of life. Gram Vikas provides technical, organisational and managerial support to leverage the inherent strength of communities to initiate, manage and sustain development processes. Gram Vikas currently reaches over 30,000 families in 400 villages across 15 districts of Orissa.
The Gram Vikas programme, MANTRA (Movement for Action Network for Transformation of Rural Areas), aims to enable poor and marginalised communities in Orissa to enhance and sustain their quality of life through infrastructure and system improvements.
Under MANTRA, Gram Vikas uses community managed water supply and sanitation as an entry point and core rallying element for all families in a village to come together, cutting through social barriers.
Gram Vikas facilitates village communities to establish, operate, and manage their own habitat including disaster-proof housing, water supply and sanitation systems, and appropriate water recharge mechanisms.
These facilities are created with the efforts and resources of the communities involved, with some assistance from external agencies.
This Agreement with Gram Vikas is the second partnership to be formed by the BHP Billiton India Development Foundation with an Indian NGO.
The first was with the LV Prasad Eye Institute, a Hyderabad based NGO that is building a world class eye hospital in Bhubaneswar.
Signing the agreement on behalf of Gram Vikas, Joe Madiath, executive director of Gram Vikas, said, "It is heartening to experience that a mining company like BHP Billiton is coming forward to assist social development of rural areas. In Orissa, Private Public Partnership is to play a big role for improving the quality of life in the villages. Orissa should experience more corporate social responsibility especially from the mining companies. The bottom line of corporates cannot be profits at the cost of the community and general well being of the people. I do hope that many more companies take corporate social responsibility seriously."
Comment from Indian environmentalist, Biswajit Mohanty:
BHP-Billiton wants to mine the Karlapat bauxite deposits in Orissa. This is adjacent to the Karlapat Wildlife Sanctuary home to tigers and elephants. We have been protesting this move and have urged BHP-Billiton to drop their plans.
At present they are pressurising the Orissa govt. to denotify the Karlapat WLS so that they can get permission to work the mines.
At the same time to hoodwink the public they throw around a few crores in the garb of social welfare contributions. While their fund is worth a tiny miniscule sum of Rs.13 crores only, the mine has bauxite deposits of around 75 million tonnes valued at Rs. 75,000 crores at current prices!
It is pure greenwash and should be rejected. Desperate to get public support they are talking about social development,etc. This stained money should not be touched by any one with an iota of conscience. I wonder how this NGO accepted their money.
Chile Mining Min Slams Escondida On Copper Royalty
by SANTIAGO (Dow Jones)
17th February 2006
Chilean Mining Minister Alfonso Dulanto slammed copper mining giant Escondida's decision to not pay royalties as it would only have cost it 2% of its $2.5 billion 2005 earnings, La Tercera newspaper reported Friday.
"It's not very sensible that a company that makes that level of income using non-renewable resources in Chile isn't willing to pay" the royalty, Dulanto told the newspaper.
The royalty tax is based on annual production and Escondida would have paid about $40 million in copper mining royalties.
Escondida opted to not pay royalties under the current law, as one of its owners, a consortium led by Mitsubishi Corp. (8058.TO), opted for guaranteed tax rate.
Escondida is owned 57.5% by Anglo-Australian mining giant BHP Billiton PLC (BHP), 30% by Anglo-Australian company Rio Tinto PLC (RTP), 10% by a Mitsubishi Corp.-led Japanese consortium and 2.5% by the International Finance Corp.
"It was their option and they'll probably know how to deal with the issue in the future," Dulanto said.
The government recently said it would send a bill to congress that would clarify royalty payments and would force Escondida to pay.
That bill is ready and waiting for President Ricardo Lagos to send it to congress, a Mining Ministry spokesman said Friday.
The royalty is a tax of 5% of operating profits on miners who produce more than 50,000 metric tons of copper a year. Escondida is the only miner that opted for the non-royalty paying tax scheme.
As the largest privately-held copper miner, Escondida is the biggest tax payer in the country.