MAC: Mines and Communities

US company aren't no calendar girl!

Published by MAC on 2006-03-07

US company ain't no calendar girl!

7th March 2006

The industry body, ICMM (International Council on Mining and Metals) has just announced a set of planned studies, aimed at disproving the "resource curse" theory. Wayne Murdy, chair of the ICMM, is heading this attempt to show that minerals investment can bring long-lasting benefits, as opposed to the damage and impoverishment claimed by many communities around the world.

Unfortunately, the credibility of this exercise is undermined by the fact that Mr Murdy is also chair of Newmont - consistently cited as one of the most destructive mining companies on the planet.

Now, the community around Newmont's Afaso mine is accusing it of deceitfully claiming credit for construction of a road, which was actually government-funded.

Set alongside other recent condemnations of Newmont's practices in Ghana, the accusation doesn't bode well for Murdy's heroic global quest…

Statement By WACAM on the attempt by Newmont to take credit for government project in Kenyasi

8th March 2006

Community acceptance of surface mining projects is based on the notion that mining would lead to the accelerated development of the communities. Many people in Kenyasi and its environs were hopeful that the presence of Newmont in area would help provide sustainable employment and other benefits to the people in the area. This hope is gradually turning into an unrealisable dream

Newmont has been operating in the Kenyasi area for more than two years where it is constructing its Ahafo mine. Even at the construction stage, the affected communities are faced with many problems that have worsened their living conditions.

Some of the problems of Kenyasi and its environs include but not limited to the following:

• Increased unemployment rate and loss of livelihood resulting displacement of farming communities and payment of low compensation to farmers. Newmont paid 63,000 cedis(equivalent of $7) as compensation for a Cocoa tree

• Reduction in the number of rooms by the company for resettled community people under an agreement that Newmont termed “space for space”. Community people with three rooms in some instances had only one room

• The construction of a dam on River Subri has exposed the affected communities to danger. The dam has cut off communities like Dokyikrom, and Osei. Tutukrom. Newmont had refused to either relocate or resettle these affected communities despite numerous petitions by the community people to Newmont and CHRAJ. School children who cannot cross over the dam to school have dropped out of school. Two people got drowned in the dam in 2005.

• In February 2006, the over flow of water from the tailings containment polluted River Apensu and destroyed harvested crops of farmers in nearby villages especially Yaro Grumah No 1 and No2 villages

• The company’s drivers drive recklessly in disregard of human lives. Accidents involving company vehicles and residents have been steadily increasing, with a number of deaths.

• The company constructed a facility that directed the faecal matter from Newmont’s camp site into River Asuopre, a drinking stream of farmers around Kenyasi and Ntotroso. Newmont paid ridiculous compensation to the communities that drank the water polluted with faecal matter.

These are serious problems worth the attention of Newmont. Instead of resolving these problems, Newmont uses its strong Public Relations to create the impression that the community problems are not real. Newmont’s public stand on the community problems is that, NGOs like WACAM have no legitimate right to talk about these important problems affecting the lives of the communities.

As part of Newmont’s attempt to hype up the impression that its presence in Kenyasi area has led to infrastructural development, the company prepared a calendar with the development projects it had undertaken in the Kenyasi area and included photographs of the government constructed road from Kenyasi to Hwidiem among its projects.

WACAM is aware that some Assembly members and people in the Asutifi District have expressed disappointment with the attempt by Newmont to take credit for development projects of government.

Newmont’s calendar which was widely distributed has become an issue of public condemnation in Kenyasi and the company yesterday(7th March 2006) used a van with public address system to appeal to the people in Kenyasi in possession of copies of the calendar to submit them to Newmont for a fee of 20,000 cedis (about $2 ) .

WACAM wishes to condemn this act as a dishonest and deliberate attempt by Newmont to take credit for a road project that had been constructed by the government of Ghana with the taxpayers’ money and call on all well-meaning Ghanaians to add their voice to the condemnation of attempts by some mining companies to exaggerate the projects they have undertaken in mining communities.

WACAM demands an apology from Newmont to the people and the government of Ghana for attempting to use dishonest means to take credit for a project which has been constructed from the sweat of Ghanaians and the vision of its government.

WACAM once again calls on Newmont to have the courage to resolve the community problems instead of using Public Relations gimmicks to sweep the problems under the carpet.


Stung mining firms want to be catalyst for growth

by Eric Onstad, Reuters, JOHANNESBURG

8th March 2006

Mining firms, stung by criticism that proceeds from mining rarely filter down to the poor, want to prove their presence can aid economic growth.

The International Council on Mining and Metals (ICMM) aims to put new research into action with pilot projects to help governments spend their mining wealth on infrastructure, health care and education, the council's head told Reuters.

"We can be an important catalyst, we can't be a full solution, but it is important there are good governance models, people need to see the economic benefits of these activities," ICCM Chairman Wayne Murdy told Reuters late on Tuesday.

"Some of our critics would like us to just disappear, that's not realistic, but what is appropriate is that we have learned from our mistakes in the past."

Murdy, who is also chairman of Newmont Mining Corp, the world's second biggest gold producer, spoke by telephone from his firm's headquarters in Denver.

The ICCM was formed in 2002 by mining firms battered by criticism that poor countries were "cursed" with windfalls from mining and oil operations, with much of the populace falling deeper into poverty as economic growth stagnated.

ICMM-sponsored research showed that the "curse" was not a blanket trend and set out to dig up the reasons why some mineral-rich countries like Chile have managed to grow their economies and slash poverty while others have failed dismally.

Corruption is an ongoing difficulty, but in many cases, lack of funds was not the biggest problem -- local authorities had limited training to oversee long-term development programs.

Peru, where Newmont is one of the country's biggest taxpayers, still sees protests against mines even after changing its laws so that some tax revenue from mining goes directly to communities surrounding an operation.

"Unfortunately there's very limited capacity among these local politicians and their staff to cope with and deal with the kind of funds that are available to them," Murdy said.


Following the release of the research, conducted by independent groups, the ICMM plans to launch two pilot projects in the second half of the year to put its new "Community Development Toolkit" to the test.

It aims to select two governments who will cooperate along with non-governmental organizations and institutions such as the World Bank to put some of the recommendations in place.

When the World Bank approves financing for projects, it might also be able to work with local authorities to improve their efficiency and capabilities in spending tax money generated from the mines, he added.

This is much more a collaborative effort than ongoing moves to lessen the environmental impact from mining, over which firms have much more control.

"These are not easy matters on the social side. On the environmental side, for the most part we've got standards where we operate, these things are measurable, we've got technical people who can monitor these things," Murdy said.

"There is only so much we can do in that (social) regard. We do have a social responsibility, but it's very important that we understand that we maintain the responsibilities of government."

The ICMM, which also sponsors research on technical environmental issues, eventually aims to formulate an ethical code of conduct for mining firms.

"Clearly we are trying to look toward the time where individual mines can be assessed for compliance on environmental and social benchmarks."

ICMM members include the biggest diversified mining groups BHP Billiton, Rio Tinto Plc and Anglo American Plc.

Other members are South African gold producer AngloGold Ashanti Ltd, Canadian nickel producer Falconbridge Ltd, U.S. aluminum producer Alcoa, and Japanese base metals producer Sumitomo Metal Mining.

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