Promoting responsible mining

2009-10-11

in Canada, Economics, Law, Politics, The environment

Previously, I described the phenomenon where mining companies leave behind messes that would eliminate their profits if they were obliged to clean them up. Often, however, these liabilities end up being borne by taxpayers in general, who either fund the cleanup or live with the consequences of the contamination.

Now, a private members bill proposes sanctions on Canadian mining companies that violate good governance and environmental standards abroad. Bill C-300 was proposed by Liberal MP John McKay, and has already passed through second reading in the House of Commons.

Extractive industries, including mining, certainly have a checkered history of international operations. While there are certainly examples of projects that take into account governance and environmental concerns, legal reforms that make these more typical are welcome.

Report a typo or inaccuracy

{ 5 comments… read them below or add one }

Tristan October 12, 2009 at 11:49 pm

Glad to see the site is back up.

Milan October 13, 2009 at 8:56 am

GoDaddy has their occasional explosions, though it is usually just their MySQL servers.

. December 5, 2010 at 3:58 pm

SIR – You noted that our legislation bringing more transparency to extractive industries marked a big step in the fight against global corruption, through the simple means of requiring all oil and mineral companies listed in the United States to report publicly their payments to governments (“Naming and shaming”, October 30th). This could become, like the OECD anti-bribery convention, a new global standard for transparency and accountability if the leaders at the G20 summit in Seoul adopt such reporting as a universal principle.

It would level the playing field and discourage stock exchanges from competing on the basis of weaker regulations, while imposing little burden on oil and mining companies. Its broader adoption would give those who fight corruption everywhere an important means to “follow the money”.

Senator Benjamin Cardin
Senator Richard Lugar
Washington, DC

. December 9, 2010 at 7:30 pm

Sierra Leone’s minerals
Digging for trouble
The government is breaking its own rules on exploiting resources

WHEN Sierra Leone’s decade-long civil war ended in 2002, the remote areas where that diamond-fuelled conflict originated had become a blasted wasteland of ruined villages and people sheltering under tarpaulins. Today, viewed from a lumbering Russian-made helicopter run by the country’s much reduced United Nations contingent, reconstruction is plain to behold. Houses have roofs again and local people, once terrified of the bush and the horrors it contained, are busily going about their lives.

Eight years of peace have seen all sorts of progress. The Revolutionary United Front, a lethal rebel group that specialised in amputating civilian hands, is no longer a force. Refugee camps have closed and presidential polls in 2007 passed off peacefully.

But the country has recently taken a step back. The kind of resource predation that led to violence breaking out in the first place may be returning, this time with iron ore rather than diamonds as the catalyst. With notable haste, the government in Freetown has given two big extraction leases to British companies. The first, London Mining, will redevelop an abandoned mine at Marampa, some 80km (50 miles) from the capital. The second, much larger, deal with African Minerals concerns a find at Tonkolili that the company says is the world’s largest deposit of magnetite—used, among other things, for coating industrial boilers. Initial work on the mine is already under way, though confirmation of a $1 billion-plus investment in the venture by a Chinese company, Shandong Iron and Steel, has been delayed.

Neither lease appears to conform to a new mining act that Sierra Leone drew up last year with international support to establish a framework for mineral exploitation. Alongside diamonds and iron ore, the country is known to have huge amounts of rutile, bauxite and—following an offshore strike last year—oil. In 2007 state revenues from mining were $10.5m, 0.6% of GDP.

London Mining and African Minerals both say Sierra Leone is getting a good deal and that without special treatment they might not have invested in the country. They also insist that their leases conform to the mines act. It was created to avoid repeating the past, when a kleptocratic president, Siaka Stevens, made secret extraction deals for his own benefit, prompting a resentful people eventually to rebel, with help from next-door Liberia, whose leaders pilfered Sierra Leone’s diamonds.

. July 30, 2011 at 12:16 pm

Zimbabwe and its diamonds
Forever dirty
Robert Mugabe is being favoured once again, to the detriment of his people

THE Kimberley Process (KP) is in danger of collapse. Set up in 2003, the system is supposed to end the trade in “blood diamonds” which illicitly finance civil wars. But its Congolese chairman has unilaterally decided to let sales from Zimbabwe’s disputed Marange diamond fields resume. America, the European Union, Canada and Israel are hotly contesting the move. Rulings by the 49-member body, representing 75 diamond-producing and -trading countries, are supposed to be unanimous.

Ever since diamonds were first discovered in a 60,000-hectare site in Marange in eastern Zimbabwe in 2006, reports of killings, torture, corruption, bribery, looting, smuggling and political skulduggery have been rife. The stakes are enormous. Tendai Biti, Zimbabwe’s finance minister, has described the field as “the biggest find of alluvial diamonds in the history of mankind”. Potential revenue has been estimated at $1 billion-2 billion a year. One mining expert involved in the area reckons it is “much, much more”. The IMF put Zimbabwe’s entire GDP last year at $7.5 billion.

Leave a Comment

You can use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

Previous post:

Next post: