Volume 7 Number 2 June 2002
reporting on the mining and energy industries Embassy ignored killings at Indonesian mine
The Australian government has lems with illegal mining’.5 defended Embassy officials in Jakarta A follow up meeting was held on 2 who lobbied Indonesian security March 2000 in Jakarta with the forces and officials to deal with ‘illegal Governor of Central Kalimantan, the miners’ at an Australian-owned mine. Bupati (regent) of the local regency, In three separate incidents after the police and military officials. Embassy lobbying commenced, two people staff also attended ‘as observers, at have been killed and another five the request of Aurora Gold’. Accord- injured. ing to Downer, Embassy staff ‘high- Controversy over the lobbying lighted the damage to investor activities of Australian Embassy confidence in Indonesia if the Gov- erupted after the shooting incidents ernment was unable to honour by the notorious Mobile Brigade contracts of work and resolve the Mt (Brimob) – in June 2001, August Australian Minister for Foreign Affairs, Alexander Muro dispute’. The following day 2001 and January 2002 – at the Mt Downer. Photo: Bob Burton. Aurora welcomed assurances from Muro mine owned by the Perth based Indonesian government officials that company, Aurora Gold. Downer insists that the Embassy ‘illegal’ miners would be removed.6 Aurora Gold – and its predeces- officials stressed that the difficulties On 25 May 2001, Richard Smith – sors – have encountered local Aurora – a signatory to the Minerals who had taken over from McCarthy opposition to large scale mining over Council of Australia’s voluntary Code as Ambassador in January 2001 – concerns about the obliteration of for Environmental Management – was visited the Mt Muro operations ‘at the traditional small scale mines, past having with ‘illegal miners’ should be invitation of Mr Joe Ariti, President abuses by security forces and pollu- resolved ‘in a peaceful manner’. 3 Director, Aurora Gold Indonesia’.7 tion.1 Despite Embassy officials being Smith addressed a meeting of provin- Aurora’s Chairman, Rory Argyle, aware of the deaths and injuries from cial government officials and, accord- has acknowledged that the collapse the military crackdown, no inquiries ing to Downer, stressed ‘the impor- of the Indonesian economy has were made of either Aurora or Indo- tance of upholding the law, including forced many people to turn to what nesian police until after Senator the company calls ‘illegal mining’ as Brown asked a series of questions in ‘a means of survival’.2 However, February 2002. In this issue Aurora’s economic survival was also In October 1999 IMK unsuccess- tied to the Mt Muro mine, its only fully urged authorities to ‘take control ‘Socially responsible’ source of cash. of illegal mining and unrepresentative climate change? 4-6 In answers to parliamentary groups’.4 Aurora then turned to Aus- 7 questions by Australian Greens tralian Embassy officials. On 2 No- SRI funds worry miners Senator Bob Brown, the Minister for vember 1999 Aurora Gold representa- Coming clean with Foreign Affairs, Alexander Downer, tives briefed the then Australian Old King coal 8-9 revealed that since November 1999 Ambassador, John McCarthy, about Embassy officials in Jakarta have their concerns. Just over two weeks SRI advisers rely on worked with Aurora Gold representa- later, McCarthy met the Indonesian media to ring alarm bells 10 tives in lobbying Indonesian officials Minister for Mining and Energy to and security forces to eject illegal discuss concerns of Australian mining Bringing it back home 11 miners entering the Mt Muro mine. companies, including Aurora’s ‘prob-
Phone 61 2 9557 9019 • w w w.mpi.org.au • Email [email protected] Corporate Accountabilty laws relating to illegal occupation of officials or Aurora.10 Nor, wrote waste rock at the Kerikil minesite. mining leases and theft, at Austral- Downer, did Aurora inform Embassy The man’s two companions – who ian-owned mining operations in staff of the incident. fled after the shooting – reported that Indonesia to ensure an environment Despite the killings, desperate he was shot in the head at close in which Australian investors could miners continued their scavenging range. After the shooting protests operate in accordance with their operations. Early on Monday morning resulting in the pit being occupied for contracts of work’.8 27 August 2001, Brimob fired three a day. On 5 June 2001, Brimob mem- shots at a group of small boys scav- A media release the following bers shot at a group of small-scale enging in the Kerikil pit. One – a Thursday by the Mineral Policy miners scavenging waste rock in the teenage boy – was shot and disabled Institute sparked media coverage by waste rock dumps at the Kerikil mine, with a bullet passing through one of the Australian Financial Review and one of a number of pits at the Mt his legs and entering the other. ABC’s Asia Pacific program.12 Ac- Muro minesite. Fleeing the Brimob, According to Downer, ‘the Ambas- cording to Downer, it was not until six of the miners fled into a flooded sador was aware of media reports of five days later that Aurora advised the mine. From the pit edge Brimob the incident’ but made no inquiries of Australian Ambassador of the inci- members continued firing and threw either Indonesian government officials dent. According to Downer, the stones at the trapped miners, killing or Aurora Gold.11 Downer insists Ambassador took no further action. two of them. Another three were However, two weeks after the shoot- injured, one crippled as a result of ing and protests in Indonesia, authori- being shot in the knee. ties announced that Brimob would be Aurora’s then Company Secre- ‘the Ambassador was aware of recalled from the minesite.13 tary, Michael Baud, later claimed media reports of the incident’ The Australian Embassy in Indo- that the deaths ‘were drownings by nesia only began inquiries into the people who were operating illegally in Alexander Downer series of shootings after Brown tabled the mine and fell in to the water at the questions in the Senate on 18 Febru- bottom of a disused pit and ary 2002. Nine days later, the Austral- drowned’.9 Aurora did not inform the Australian ian Embassy ‘sought clarification’ According to Downer, while the Embassy of the incident. from the Indonesian police force Ambassador was aware of media In a further incident on Saturday about ‘the reported incidents’.14 On 5 reports of the incident no attempt 17January 2002, a police officer shot March 2002 Aurora sent a written was made to obtain information from and seriously wounded a 20 year old briefing to the Ambassador on the either Indonesian government man who was searching through series of incidents at the mine.
ISSN 1443-5284 Editor: Bob Burton Sub-editing/proof reading: Consensus Productions
Mining Monitor is published quarterly by the Mineral Policy Institute (MPI). Mining Monitor aims to provide detailed, referenced information to inform and support community organisations concerned about the impacts of mining projects (including oil and gas) in Australasia and the Pacific. The views expressed are not necessarily those of MPI.
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Mineral Policy Institute PO Box 89, Erskineville NSW 2043, Australia Phone 61 2 9557 9019 Fax 61 2 9557 9822 Email: [email protected] Website: www.mpi.org.au
Patron President Treasurer Director Bob Brown Alison Gibbins Geoff Lambert Geoff Evans
Research Co-ordinator Campaign Co-ordinator Information Co-ordinator Nina Lansbury Simon Divecha Igor O’Neill
2 Phone 61 2 9557 9019 • w w w.mpi.org.au • Email [email protected] Corporate Accountabilty
Despite the controversy, Downer and prosecution if credible allegations www.auroragold.com.au, 3 March 2000. 7 saw no need to review the role of arise’.18 Minister for Foreign Affairs, Alexander Downer, Senate Hansard, www.aph.gov.au/ Embassy officials in the affair. ‘At no Mining Monitor repeatedly con- hansard/hanssen.htm, question number 116, stage did the Ambassador or Em- tacted Rio Tinto’s media spokesper- 15 May 2002, p 1647. 8 bassy officials request Indonesian son, Ian Head, requesting clarification ibid. 9 Environment News Service, ‘Indonesian Man Government authorities act other than on whether whether Rio Tinto staff Shot at Australian Gold Mine’, http://ens- in a peaceful manner, in accordance had contacted news.com/ens/jan2002/2002L-01-23-01.html, with Indonesian law. In this context, Australian Em- 23 January 2002. 10 Minister for Foreign Affairs, Alexander the Minister does not consider a bassy officials, Downer, Senate Hansard, www.aph.gov.au/ Departmental review necessary’, Indonesian offi- hansard/hanssen.htm, question no 117, 15 Downer informed Parliament.15 cials or Aurora May 2002, p 1648. 11 Minister for Foreign Affairs, Alexander Rio Tinto – a signatory to the about the inci- Downer, Senate Hansard, www.aph.gov.au/ United Nations Global Compact dents at Mt Muro hansard/hanssen.htm, question number 124, promising to voluntarily uphold Local villagers have lost while it was a 15 May 2002, p 1651. 12 international human rights standards valuable land to the major shareholder Mineral Policy Institute, ‘Shootings deaths at mine operations. Aussie mine’, Media Release, www.mpi.org.au, – is also embroiled in the controversy. Photo: JATAM and had been a 24 January 2002; Australian Broadcasting In November 2000 Rio Tinto took director on the Corporation, ‘Security forces shooting at goldmine provokes protests’, www.abc.net.au/ over Ashton Mining in order to control board of Aurora. Head has not asiapacific/location/asia/ all of the Argyle diamond mine.16 As a responded. GoAsiaPacificLocationStories_466769.htm, 25 May 2001. by-product of the deal Rio Tinto Bob Burton 13 ‘Mining: Brimob out after Muro shooting’, gained a 35% shareholding in Aurora. Laksamana.net, 3 February, 2002. [Transla- In February 2001 Rio Tinto appointed tion]. 1 See Bob Burton, ‘“Take control” Aurora tells 14 the Managing Director of Argyle Minister for Foreign Affairs, Alexander Indonesian Governor’, Mining Monitor, Volume Downer, Senate Hansard, www.aph.gov.au/ Diamonds, Gordon Gilchrist, to 4 Number 4, November 1999, pp 1-2. hansard/hanssen.htm, question number 119, Aurora’s Board.17 Gilchrist remained 2 Rory Argyle, ‘Annual general meeting 2000 - 15 May 2002, p 1649. address by the Chairman’, 15 Minister for Foreign Affairs, Alexander on the board until Rio Tinto sold its www.auroragold.com.au, 4 May 2000. Downer, Senate Hansard, http:// shareholding in October 2001. While 3 Minister for Foreign Affairs, Alexander www.aph.gov.au/hansard/hanssen.htm, it was a major shareholder two of the Downer, Senate Hansard, www.aph.gov.au/ question number 124, 15 May 2002, p 1651. hansard/hanssen.htm, question number 116, 16 Rio Tinto, 2000 Rio Tinto Annual report and shootings occurred — in June and 15 May 2002, p 1647. financial statements, www.riotinto.com, p 17. August 2001 — resulting in two 4 Aurora Gold, ‘Update: Mining operations – Mt 17 Aurora Gold, ‘Board changes’, Announce- deaths. Muro’, Announcement to the Australian Stock ment to the Australian Stock Exchange, Exchange, www.auroragold.com.au, 11 Rio Tinto guidelines on dealing www.auroragold.com.au, 1 February 2001. October 1999. 18 Rio Tinto, ‘Human rights guidance: Guid- with human rights abuses at projects 5 Minister for Foreign Affairs, Alexander ance for managers on implementing the where it is not the manager state ‘we Downer, Senate Hansard, www.aph.gov.au/ human rights policy in The way we work’, hansard/hanssen.htm, question number 123, www.riotinto.com, April 2001, p 9. should also … make clear that Rio 15 May 2002, p 1650. Tinto strongly disapproves of human 6 Aurora Gold, ‘Update: Mining operations – Mt rights violations of employees or local Muro: provincial government gives assurances on illegal mining’, Announcement to the people, and press for investigation Australian Stock Exchange,
Obstructors should be shot, says mining executive According to a December 2001 report by the International Crisis Group (ICG) – an international think tank funded largely by governments and foundations – Indonesian authorities have been lobbied to resort to violence to protect mining company projects. The ICG report on law enforcement and the exploitation of natural resources in Indonesia noted that some mining companies “have insisted that the government uphold their contractual rights by force if neces- sary, as in the Suharto era”. The report noted that local government officials and police often considered this view as ignoring the underlying problems.
According to the report “an Indonesian, complained to ICG that an excessive preoccupation with human rights was deterring police from shooting at people who obstructed the operations of mining companies”.1 ICG did not identify either the individual or the company for which they worked.
1 International Crisis Group, Indonesia: Natural resources and law enforcement, ICG Asia report no 29, 20 December 2001, page 19.
Mining Monitor • June 2002 • page 3 Groundswell: issues & actions Socially Responsible Climate Change?
Socially Responsible Investment, (see the table below). The possible thrown about as the buzzword ‘SRI’, consequences of these gases include is the general term for investment that rising sea levels, changed weather is ethical and sustainable. For the patterns and altered incidence and socially aware investor, SRI offers an location of significant weather events, opportunity to enter the sharemarket such as hurricanes, monsoons, and with the comfort of knowing the profits droughts. The main impacts will be are not made at the expense of felt by those of the global South, who human rights, environmental conser- already suffer from much of the Can funding a carbon-powered economy be called vation or traditional livelihoods. ‘socially responsible’? Photo: Bob Burton. mining industry’s detrimental activi- Increased demand for profits ties. without social and environmental loss mining and minerals industry are In current research by MPI, the means there are now twelve SRI unlikely to meet the general percep- SRI fund managers have a plethora ‘products’ on offer to the Australian tion of sustainability, responsibility or of rational justifications for investing in investor. This is a great step forward ethics of those seeking ‘ethical’ climate changing energy sources for the world of capitalism with a investments. while advertising their product as conscience. A closer inspection, Of particular concern to MPI is cleaner, greener or more progressive. however, reveals that each of these that these SRI funds have shares in Resources, including coal and oil, SRI portfolios contains mining com- coal and oil companies, thus directly form twenty per cent of the Australian panies. The long term social and contributing to climate change stock exchange — a very significant environmental impacts created by the through greenhouse gas emissions presence, compared to the two per
SRI Funds with Coal and Oil Investments SRI Fund Company (assets) Australian Ethical Origin Energy (oil, gas). AMP Iluka Resources (oil, gas); MIM Holdings (coal, oil); Origin Energy (oil, gas); Tap Oil NL (oil, gas); and Iluka Resources (oil, gas). BNP BHP Billiton (coal); Origin Energy (oil, gas); Tap Oil NL (oil, gas);Rio Tinto (coal); and Woodside Petroleum (oil, gas). Challenger Origin Energy (oil, gas); and Woodside Petroleum (oil, gas). Equity Trustees, Iluka Resources (oil, gas); and Woodside Petroleum (oil, gas). Glebe Beach Petroleum (oil, gas); BHP Billiton (coal); Oil Search (oil, gas); Rio Tinto (coal); and Woodside Petroleum (oil, gas). ING Australian Worldwide Exploration (oil, gas); BHP Billiton (coal); Centennial Coal Company (coal); Iluka Resources (oil, gas); MIM Holdings (coal, oil); Oil Search (oil, gas); Tap Oil NL (oil, gas);and Rio Tinto (coal); and Woodside Petroleum (oil, gas). IOOF Iluka Resources (oil, gas). Rothschild Austral Coal Ltd (coal); Centennial Coal Company (coal); MIM Holdings (coal, oil); Novus Petrolum (oil, gas); Oil Search (oil, gas); and Origin Energy (oil, gas). SAM Orogen Minerals (oil, gas); BHP Billiton (coal); Caltex Australia (oil, gas); Rio Tinto (coal); and Woodside Petroleum (oil, gas). Tower BHP Billiton (coal); Caltex Australia (oil, gas);Origin Energy (oil, gas); Rio Tinto (coal); Woodside Petroleum (oil, gas). Westpac Eco Caltex Australia (oil, gas); MIM Holdings (coal, oil); Origin Energy (oil, gas); and Woodside Petroleum (oil, gas).
4 Phone 61 2 9557 9019 • w w w.mpi.org.au • Email [email protected] Groundswell: issues & actions cent presence on the global market. feature in this otherwise worthy Fund managers attempt to ensure portfolio. 9 that SRI funds perform as well or Despite these numerous reasons better than mainstream funds, and try and justifications, the case still to minimise the difference — known remains: investors are being sold as the ‘tracking error’ to three to five fossil fuels under the banner of SRI. per cent either side. Excluding The reality is that, through burning resources would increase this error these fuels, electricity production, — and thus amplify the risk — caus- agriculture, stationery energy and ing investors to ‘shy away from such Subsidies to carbon fuels undercuts renewable transport make up 81 percent of a product’ says Mark Bytheway of the energy sources such as solar power. Photo: Bob Burton. Australia’s greenhouse gas emissions Sustainable Investment Research — totalling an eyebrow-raising 430 Institute.1 five per cent.6 million tonnes of emissions each BHP is the sixteenth largest Glebe’s David Andrews describes year.10 Brown coal is the worst private sector polluter of greenhouse his clients as investors with a ‘Chris- offender, burning up 1200kg of gases and the twelfth largest coal tian World View, rather than being carbon dioxide equivalent for each producer in the world, yet it features deep green’. Although they have megawatt hour. Black coal burns only in five SRI portfolios, including ING.2 shares in fossil fuels, ‘cumulative a little cleaner at 1000kg/ MWh, while Says Glenn Langton of ING, ‘as there discomfort’ of clients by recent natural gas — hailed as the ‘transi- is no current, viable alternative, ING environmental and social activities of tion’ fuel, burns at half the rate of instead seeks the coal company with brown coal, at 650kg/MWh. 11 the best environmental practices’.’3 The obvious alternative for both He adds that ‘ING doesn’t aim to be a ‘The only truly sustainable SRI and energy sources is renewable 4 totally green fund’. company would be an organic energy which does not produce any Another investor of BHP is Sus- climate-changing gases. It’s an tainable Asset Management (SAM), lentil farm on the North Coast’. exciting place to be, according to which aims to invest in ‘sustainability AMP’s Michael Andersen, who says, Francis Grey, Fund Manager, leaders’, on the path to more sustain- Sustainable Asset Management ‘whereas coal-fired energy growth able practices. SAM’s Fund Manager, rates are close to single digits, growth Francis Grey, emphasises that rates in the renewable energy indus- investors demand all industry sectors try of 20-30% are typical’.12 are represented, even in an SRI fund. Rio Tinto have seen the company But the renewable energy market He sees SAM’s scrutiny to be ‘con- removed from Glebe’s stock.7 is hampered by price — not its own, verting companies to sustainability Before launching its SRI product, but rather the unrealistically low price thinking’. When asked about the Rothschild undertook a survey of of coal, made cheap by the govern- environmentally and socially dubious 5000 random community members ment subsidies and incentives given ‘sustainability’ of BHP and Rio Tinto, which found that when prompted to the industry. ‘It makes it so hard to which have made the list, Grey investment in uranium was consid- develop clean projects, because our emphasises, ‘SAM is a Devil’s Index, ered to be unacceptable. According coal is so cheap’, says Andrew not an Angel’s Index. Perhaps it will to Rothschild’s Leanne Bradley, Richards of Pacific Hydro.13 force the companies to become climate change and fossil fuels were This truly clean industry will be angels…The only truly sustainable not major concerns — although these significantly helped by the introduc- company would an organic lentil farm were not included as prompts.8 tion of Australian government’s on the North Coast, anyway’.5 Australian Ethical Investment, the Renewable Energy (Electricity) Act, AMP Hendersen sees fuels on a ‘deepest green’ SRI fund with a which requires an additional 9,500 spectrum, from the most greenhouse strong positive and negative screen- gigawatt hours of electricity to be gas-emitting brown coal, to black ing and an (albeit profitable) disregard generated from renewable sources coal, gas, through to renewables. for straying from the top 100 compa- including solar, wind and biomass by Although AMP’s Ian Woods says the nies of the Australian Stock Ex- 2010.14 This Act will assist renewable fund ‘favours the forward-looking role change (ASX), invests in only one oil energy to become price-competitive that Origin is playing with regard to company — Origin Energy, better through Renewable Energy Certifi- greenhouse liabilities’, he sees ‘a known for its renewable energy cates, and an additional capacity very important role in gas as a stocks. Origin’s decreasing oil explo- 2800GWh must be built to meet the transition fuel’, and reiterates the risk ration, and increasing moves towards government’s target by 2010. 15 of raising the tracking error beyond gas and renewables allowed it to Although this is a positive starting
Mining Monitor • June 2002 • page 5 Groundswell: issues & actions point, there is not currently a big SRI, if ‘tracking error’ is the driving 5 Francis Grey, Personal Communication with Fund Manager, Sustainable Asset Manage- selection of renewables in the ASX, force and profit is the bottom line, ment (SAM), 21 May 2002. and as Glenn Langton of ING states, then perhaps Australians should put 6 Ian Woods, Personal Communication with ‘Although we do seek renewable their energy into changing the gov- Senior Research Analysts, AMP Henderson Sustainable Future Funds, 31 May 2002. energy companies, most are in ernment stance instead. ‘Clean 7 David Andrews, Personal Communication startup phase, so they don’t meet the energy needs government regulation with Fund Manager, Glebe Asset Manage- financial criteria of ING: start up to take off. Ethical investment is not ment, 30 May 2002. 8 companies don’t earn enough, and driving the market. It has an influence Leanne Bradley, Personal Communication with Product Manager, Rothschild Asset 16 many fail’. at the margins only’, says Bill Hare of Management, 31 May 2002. MPI is undertaking discussions Greenpeace International.18 Until 9 Duncan Paterson, Personal Communication and research to convince the SRI then, scrutinise your SRI portfolio and with Corporate Researcher, Australian Ethical Investment, 21 May 2002. industry that it is not ethical, responsi- ask some curly questions of your 10 National Greenhouse Gas Inventory (2001), ble or sustainable to support fossil fund manager about the true social cited in Macpherson, Sholto (2001), ‘Making a fuels under the guise of SRI. Instead, responsibility of funding climate Clean Switch’, Ethical Investor, Issue 5, October, p 27. SRI funds should be supporting the change. 11 Paddy Manning, ‘Big Gains to be made renewable energy companies on the During Transition’, Ethical Investor, Issue 5, market, which are working towards a October 2001, p 31. 12 Ross Kendall, ‘Positive Investing’, Ethical carbon-free future. According to Investor, Issue 10, April 2002, p 28. Michael Walsh, an SRI industry 13 Sholto Macpherson, ‘Strong Winds Bear analyst at Corporate Monitor, ‘Main- Good News’, Ethical Investor, Issue 5, stream SRI funds could easily drop October 2001, p 30. 14 Murray Hogarth, ‘Finding the Energy’, oil, as oil exploration and refineries Nina Lansbury, Ethical Investor, Issue 6, November 2001, are not a major player in the ASX. Research Coordinator p 24. Coal might be considered on a 15 Ian Woods, Personal Communication with negative screen, but gas is unlikely to Senior Research Analysts, AMP Henderson 1 Mark Bytheway, Personal Communication Sustainable Future Funds, 31 May 2002. be dropped. However, SRI funds with Chief Executive Officer, Sustainable 16 Glenn Langton, Personal Communication want to include the resources sector Investment Research Institute (SIRIS), 15 May with Fund Manager, ING Sustainable Invest- 2002. because there’s action there. If fossil ments, 30 May 2002. 2 Natural Resources Defence Council, 17 Michael Walsh, Personal Communication fuels were dropped, there would be Kingpins of Carbon: how Fossil Fuel Produc- with Director, Corporate Monitor, 31 May more reliance on gold for resource ers Contribute to Global Warming, 2002. www.nrdc.org/globalwarming/carbon/ 17 18 Paddy Manning, ‘Clean Energy Needs performance’. kocinx.asp, July 1999. Government Action’, Ethical Investor, Issue 2, But is the sharemarket really the 3 Glenn Langton, Personal Communication July 2002. place to push for climate change with Fund Manager, ING Sustainable Invest- ments, 30 May 2002. abatement anyway? Despite the good 4 ibid. intentions and cosy statements of
BP ends donations to political parties In response to public pressure British Petroleum (BP) has announced that it will no longer make donations to political parties anywhere in the world. In a speech to the Royal Institute of International Affairs, BP Chaiman, Lord Browne, said ‘We have to remember that however large our turnover might be, we still have no democratic legitimacy anywhere in the world … We’ve decided, as a global policy, that from now on we will make no political contributions from corpo- rate funds anywhere in the world’.1
However, BP will continue to participate in industry lobbying campaigns and the funding of think-tanks. ’We will engage in the policy debate, stating our views and encouraging the development of ideas - but we won’t fund any political activity or any political party,’ he said. In response to a question, Browne said that over the long term donations to political parties were not effective.2
1 Lord Browne, Group Chief Executive, BP ‘International relations - the new agenda for business’, www.bp.com/centres/press/s_detail.asp?id=147, 27th February 2002. 2 Lenore Taylor, ‘BP stops making political donations’, Australian Financial Review, 1 March 2002.
6 Phone 61 2 9557 9019 • w w w.mpi.org.au • Email [email protected] Dialogue: industry, community,NGOs
SRI funds worry miners
Former WMC Executive Officer – veys of pension fund managers show now consultant – Ray Evans, told a that human rights and environment mining industry conference in 2001 are their two major concerns … that ‘capital markets in London and mining companies that do not ad- New York are key to the mining dress sustainability run the risk of industry. The culture permeating the increased cost of capital and loss of elites of these two cities will affect their licence to operate’.4 how decisions on allocation are Hamson told a June 2002 Miner- made’, he said.1 Evans worried that als Council of Australia seminar that with the success of activists in per- much of the controversy about the suading financial institutions to divest mining industry was because ‘miner- from controversial companies, ‘they als companies are easy targets’.5 He can do it to mining companies as urged the audience to put more effort Dr Don Hamson, the Chief Investment Officer of well’. Westpac Investment Management. Photo: Bob Burton. into communication. “Sell [the] mes- In the United States it is estimated sage more”, he told the seminar. that Socially Responsible Investment2 Officer of Westpac Investment The bad news for the mining — SRI — funds account for approxi- Management, an August 2000 survey industry is that surveys reveal little mately 15% of all the funds under for Westpac indicated that 69% of support for the inclusion of uranium management.3 While less than 1% of surveyed investors would consider an mining companies in SRI funds. managed funds in Australia could be SRI fund if they had the option. Despite this, Sustainable Asset classed as ‘ethical’, there is rapid Shaun Mays, the General Man- Management and ING include WMC growth in the sector. According to Dr ager of Westpac Financial Services, within their SRI portfolio. Don Hamson, the Chief Investment told a 2001 MMSD workshop ‘sur- Bob Burton
1 Ray Evans, ‘The north-south divide’, SRI funds with mining investments Proceedings of Finance Mining and Sustainability conference, Mining, Minerals (other than coal and oil) and Sustainable Development Project, www.iied.org, 8-9 April 2001, page 9. 2 The promotion of the term SRI as a substi- SRI fund Mining company tute for the term ‘ethical investment’ itself reflects the politics of the debate over how low the benchmarks for corporate performance AMP Iluka Resources, MIM Holdings, Sons of Gwalia should be. A report on SRI prepared by the BNP BHP Billiton, Portman, Rio Tinto, Sons of Gwalia Allen Consulting Group (ACG) for a coalition Challenger Virotec International of Australian foundations argued ‘the values based language that is commonly used may Equity Trustees Iluka Resources, ING, MIM Holdings, be inhibiting broader understanding and Glebe BHP Billiton, Lihir Gold, Newcrest , Rio Tinto, performance of this investment’. ‘Language: SRI or screened, not ‘ethical’, the ACG Sons of Gwalia recommended.The ACG has done lobbying Hunter Hall Mineral Corporation, Pima Mining NL, Selwyn Mines and consultancy work for various mining companies and the Minerals Council of ING BHP Billiton, Gympie Gold, Iluka Resources, Australia. Newcrest , Rio Tinto, WMC 3 Allen Consulting Group, Socially Responsible IOOF Iluka Resources Investment in Australia, Ethical Investment Working Group, www.allenconsult.com.au, Rothschild Gold and Resources Developments, MIM Holdings, August 2000, page 2. Portman, Sons of Gwalia, Ticor 4 Shaun Mays, ‘An investment management Tower BHP Billiton, Newcrest, Portman, Rio Tinto perspective’, Proceedings of Finance Mining and Sustainability conference, Mining, Sustainable Asset Anglogold , Aurion Gold, BHP Billiton, Normandy Minerals and Sustainable Development Management (SAM) NFM , Rio Tinto, WMC Project, www.iied.org, 8-9 April 2001, page 10. Westpac Eco and MIM Holdings, Sons of Gwalia 5 Don Hamson, ‘Market expectations: evolution not revolution’, Presentation to Westpac Sustainability Minerals Council of Australia Annual Industry Seminar, unpublished, Canberra 5 June 2002.
Mining Monitor • June 2002 • page 7 Dialogue: industry, community,NGOs Coming Clean with Old King Coal
Australia is undeniably a world leader coal-focussed path. $9.7 million per — not in environmentally responsible year is channeled to CRC R&D behaviour, not in climate change supporting fossil fuels while only $1.6 prevention, but in trading coal. Since million leaches its way to finding 1984, Australia has headed the global clean energy answers through trade list of thermal and coking coal.1 renewable energy sources.9 Even This energy source, infamous as one more disconcerting, in the govern- of the major contributors to global ment’s Greenhouse Gas Abatement warming is Australia’s biggest export- Concern about climate change have had little Program (GGAP), $82 million of the earning commodity,2 earned $10.8 impact on budget priorities. Photo: Bob Burton. total $92 million was given to projects billion in 2000, or eleven per cent of that at least partially support the fossil Australia’s total export earnings.3 CSIRO’s Division of Energy Tech- fuel industry. Of this, the coal industry ‘Up in Smoke’, a new report from nology’s mission is to ‘improve the received $30 million.10 the Mineral Policy Institute tells the competitive advantage and environ- If these figures belie a reluctance tale of the government’s favourite mental acceptability of the coal, to commit to the good, green inten- child — the coal industry — over its energy and related industries’, and it tions of 22 countries globally that lesser-loved sibling, the renewable is sitting on a pot of $20 million.7 have ratified the Kyoto Protocol, energy industry. While responsible former federal Minister for Resources countries around the world start to and Energy, Warwick Parer, stated it devise a future with clean energy, the bluntly, saying ‘because of Australian government is eyeing off ‘[there is] nothing to say that Australia’s…substantial coal deposits, the growing energy demand in Asia, [CSIRO’s] portfolio has to be Australia is particularly vulnerable to and frantically re-packaging coal to balanced’ the effects of actions to reduce be an environmentally-acceptable greenhouse gases’.11 (Interestingly, option. In 2000, steaming coal ex- Chris Thompson, this Minister was exposed two years ports to Asia formed over ninety per Marketing Manager of CSIRO later as having a significant conflict of cent ($3.4 billion) of the 8.7 billion interest by owning $2 million worth of tonnes of coal exported by Australia.4 shares in a Queensland coal mine.12) In the near future, Asia is expected to The marketing manager of This tendency still seems alive and have the world’s highest increase in CSIRO, Chris Thompson, in an ironic well in government, as the current electricity consumption and energy statement for a research body seek- Minister for the Environment, Dr capacity,5 and Australia is hoping that ing international credibility, stated that David Kemp, eagerly signed up with its ‘clean’ coal, with lower ash and there is ‘nothing to say that [CSIRO’s] the US ‘Climate Action Partnership’ in sulfur content will be classified as a portfolio has to be balanced’ when February 2002. His strategy, far from ‘cleaner development mechanism’ questioned about the strong focus on getting the government to get serious under the Kyoto Protocol. 6 It would coal-associated research compared and take real action, is to ‘engage be a triumph for the Australian coal to renewable energy, Indeed, he with business to create economically industry if coal profits could be stated that CSIRO’s research pro- efficient climate change solutions’.13 increased while simultaneously gram is ‘proportional to external ‘Clean coal’ and its related meeting the requirements of the funding’. Very little is spent on renew- technology have contentious environ- Protocol! able energy due to the small size of mental benefits. Many scientists, The government’s pro-industry the industry, compared to the signifi- politicians and activists are increas- stance supports this move. In the last cant funds devoted to coal R&D by ingly questioning the ability of ‘clean decade, it has shrugged off its fund- the larger and wealthier coal industry.8 coal’ to reduce greenhouse gas ing responsibilities to the Common- Cooperative Research Centres emissions. They argue that the very wealth’s research body, the CSIRO, (CRC), the think-tank melting pots nature of coal and its combustion forcing the CSIRO to sing for its with funding and researchers from defies its ability to be ‘clean’, and that supper by seeking 40% of all re- universities, government and the true ‘clean energy’ lies in the use of search funding from industry. The private sector, are taking a similar renewable energy sources, such as
8 Phone 61 2 9557 9019 • w w w.mpi.org.au • Email [email protected] Dialogue: industry, community,NGOs wind, solar steaming and photovoltaic government sector which are keeping Natural Resources and Mines, Brisbane. 2000. cells. 14 More specifically, the much- the issue on the agenda, while 5 J. Moullakis, ‘Coal to continue firing touted low sulfhur content is irrelevant tirelessly promoting the alternatives to economy’, Australian Financial Review, to the amount of greenhouse gas fossil fuel. MPI’s report feeds into this Commodities section, 23 January, 2002. emissions, which are based on the information base and will support new 6 G. Compton, Personal Communication with APEC Section, Energy Division, Federal carbon content of coal, and sulfate campaign initiatives to prevent Department of Industry, Science & Resources, aerosols actually act to briefly sup- complete capitulation to Old King 22 March 2002. 7 press global warming and reduce Coal. Division of Energy Technologies, Division of Energy Technologies, CSIRO website, projected temperature increases by Nina Lansbury www.det.csiro.au, 2001. one degree. 15 8 Chris Thompson, Personal Communication Further criticism of the ability of with Marketing Manager, Commonwealth Scientific and Industrial Research Organisa- ‘clean coal’ technology to bring about Nina Lansbury, ‘Up in Smoke: tion, Sydney, 22 March 2002. a reduction in greenhouse gas Australian Coal Exports to South 9 Chris Riedy, Public Subsidies and Incentives emissions has been labelled as a East Asia’, Mineral Policy Institute to Fossil Fuel Production and Consumption in Australia, Institute for Sustainable Futures ‘business as usual’ scenario, with and Climate Action Network Aus- (draft), Sydney, November 2001. minimal reductions when compared tralia, May 2002 is available on 10 ibid to the total emissions associated with request from MPI. 11 Warwick Parer, ‘Coal and Investment: Regional Investment Strategies for Coal, coal fired energy generation. Be- 1 Department of Industry, Science & Re- Power Infrastructure and Technology Trans- rd tween 1989 and 2000, greenhouse sources, Australia’s Export Coal Industry, fer’, 3 APEC Coal Flow Seminar, APEC gas emissions related to improved Energy Minerals Branch, Department of Energy Working Group, Terrigal, Australia, 26 Industry, Science & Resources, Australia, November 1996. coal mining and coal combustion 1999. 12 Construction, Forestry, Mining and Energy techniques, such as ‘clean coal’ 2 Australian Bureau of Agricultural and Union, Media Release, September 1998. initiatives were reduced by up to Resource Economies, ‘Coal Price Talks 13 Kemp, David, ‘US/Australia Climate Treaty’, Heating Up as Steel and Power Producers Minister of the Environment’s Media Release, 3.6%, while the growth in emissions Stake their Claims’, Australian Commodities www.ea.gov.au, 27 February 2002. 16 was over 50%. and Trade to Asia, December, Volume 1, 14 Towards Ecological Recovery and Regional It’s painfully obvious that the Number 4, 2000. Alliance, ‘Facing up to Climate Change in the 3 M. Farrow, ‘Welcoming Address’, 4th APEC Mekong Region’, Watershed, Volume 7 Australian government is keen on Coal Flow Seminar, APEC Energy Working Number 1, 2001, pp 52-63. coal, at the cost of finding cleaner, Group, Honolulu, 11-13 November, 1997. 15 Mark Ellis, ‘Can Coal be Clean?: “Clean greener alternatives. The responsibil- 4 Joint Coal Board and Queensland Depart- Coal” Technologies and their Potential Impact ment of Natural Resources and Mines, on Global Warming’, AID/WATCH and ity for preventing massive climatic Australian Black Coal Statistics 2000, Joint Greenpeace Australia, 1997. crises has now fallen to the non- Coal Board and Queensland Department of 16 ibid
Rio Tinto chairman annoyed investors listen to activists
The Chairman of Rio Tinto, Sir What that we would probably avoid simply Robert Wilson, was exasperated irritated him, because of the hassle, the when he faced questions at a semi- though, was reputational adverse consequence, nar organised by Rio Tinto on social that ethical because we will be blamed once we and environmental reporting. ‘I think investors get there — we will be blamed by parts …perhaps this is inevitable, that a took commu- of the NGO community for everything Group like this is always going to be nity groups’ that we have inherited, even though Sir Robert Wilson. documenta- we might actually be doing our best to subject to attack by single interest Photo: Rio Tinto NGOs on one particular ground or tion of Rio put things right!’, he said. another’, he said.1 Tinto’s activities seriously. ‘The fact Wilson also revealed his irritation ‘That is not something we feel that we are subject to campaigns by at publicity over human rights abuses that we need necessarily be defen- single interest groups means that we at the Kelian mine in Indonesia, which sive about because, in fact, if you are also subject to a bit of casual the company attempted to conceal. look at the culture and philosophy of smearing by those same groups as Bob Burton sustainable development it is we well, and sometimes that gets ab- who are in step, not the single sorbed by the SRI community’, he 1 Rio Tinto, ‘Questions and Answers’, interest NGO wanting to take deci- said. Proceedings of Social and Environmental sions on the basis of just that single ‘There is no doubt that there are Performance Seminar London, www.riotinto.com, 30 April 2002, p 3. interest’, he audaciously claimed. certain types of project in operation
Mining Monitor • June 2002 • page 9 Dialogue: industry, community,NGOs SRI advisers rely on media to ring alarm bells
Many fund managers and advisers of result they gained a small amount of ethical fund advisers – with limited in- coverage on the wire service, Austral- house research staff themselves – ian Associated Press (AAP). rely on monitoring the mainstream After the AAP article, the head of media for stories raising issues about Monash University’s Centre for controversies over environmental and Environmental Management, Doug social impacts of companies. Holmes, who advises Westpac on Proponents of voluntary corporate environmental research and ratings reporting point to the prospect of for Westpac’s Eco Pool ethical funds, stories exposing corporate sins filed contacted Normandy.2 ‘The thing that quickly being picked up around the triggered it was the march of the fifty world. It is, they argue, a vital antidote villagers’, Normandy’s Public Affairs to the spin contained in volumes of Manager, Dr Chris Anderson, told glossy corporate reports. Reviewing the impact of CPI – Mining Monitor.3 However, within the journalism which has established a global ‘I …went over [from Adelaide to profession, there is increasing soul- network of 80 investigative journalists Melbourne] to meet Doug …and searching about the failure of media in 40 countries – Lewis noted that spent a few hours with them and we organisations to cover important exposés on corporations gained provided them with lots of documents stories about powerful corporations. much less media coverage than that including the EIS [Environmental In the wake of the collapse of Enron exposing government officials or Impact Statement] and a range of the prestigious Columbia Journalism bureaucracies. “When we did investi- other reports’, he said. ‘As a result of Review has pointed its finger at US gative reports about companies the that they seemed satisfied’, he said. journalism as having failed the public. thresholds were much, much higher Anderson also said he discussed ‘How, and why, did it happen?’, and very frequently nothing would be the issue with Melbourne staff of the CJR contributing editor Scott mentioned in the media …There is no World Wide Fund for Nature, Com- Sherman asked. His conclusion was question in my mind there is a reluc- munity Aid Abroad-Oxfam and the that most journalists and editors were tance … by most media corporations, Australian Conservation Foundation – victims of corporate spin while the from the people managing them down none of whom were working on the more sceptical journalists had a hard to the street level reporters that you issue. Neither Anderson nor Holmes time swimming against the current. better be careful when you go after made inquiries with either members Chuck Lewis, the Executive them [corporations]”, he said. of the Turkish community in Australia Director of the Center for Public If major stories – such as the or MPI who were in contact with Integrity – a Washington DC based Enron scandal – go underreported community groups in Turkey. non-profit journalism group – believes where there is a free press, what It is telling that until media cover- there are does it mean for fund advisers age of the protests SRI advisers had fundamental supporting mining companies with no idea about the opposition to problems with projects in distant countries? Normandys’ Turkish project. Early in the mainstream Throughout the mid-1990s villag- 2002, Westpac dropped Normandy media covering ers in a remote rural area of Turkey from its Eco-Pool but Sustainable stories on major opposed a gold mine proposed by Asset Management (SAM) continues corporations. Normandy Mining, even staring down to include it. Lewis, a former tanks sent in to break a tractor Bob Burton Center for Public Integrity CBS 60 Minutes blockade of the minesite. The issue Executive Director, Chuck producer in the gained no coverage in mainstream Lewis. Photo: Bob Burton. US, believes Australian media. 1 Interview with author 30 May 2001. commercial In April 2000, fifty Turkish villagers 2 ‘Monash holds Normandy on negative watch media outlets want soft stories that marched in protest against the mine over Turkish mine’, 30 December 2000. garner ratings to attract advertisers, to coincide with the annual Gallipoli 3 Interview with Chris Anderson 3 August not news that challenges the powerful.1 commemoration ceremony. As a 2001.
10 Phone 61 2 9557 9019 • w w w.mpi.org.au • Email [email protected] Inside the eye: news from the directors desk Bringing it back home
The World Summit on Sustainable better practices. Where campaigns in Development (WSSD) in Johannes- the past could often be run and won burg in August 2002 will test how locally or with support from groups much governments and corporations within the same region, today global will embrace a broad view of sustain- campaigns through the emerging able development. citizens networks are essential. Sustainability should be about Our campaigns for responsible providing food security to people, mining have forced the industry to ensuring access to decent respond with initiatives like the healthcare, employment, housing, Global campaigns are required to control global Mining, Minerals and Sustainable education and a healthy environment. mining and energy companies. Photo:Bob Burton. Development project, which has However, in the wake of the Septem- opted for timid mechanisms to im- ber 11 attacks on the US, the ‘secu- wielding far more power than citizens. prove corporate practices. The rity’ agenda has been overshadowed However, it is time to make a reports imagine they can sidestep the in many places by anti-immigrant sober assessment of how the mining tension between embracing the free border protection and repressive industry fits with Australia’s future. A trade agenda and urging the adoption ‘anti-terrorist’ measures that threaten few years ago it was possible to say of higher standards which often result basic democratic rights. that mining was perhaps the only in higher costs structures. Dumping The Mineral Policy Institute (MPI) global industry where Australian wastes in rivers and oceans is cheap, is a key participant in the Global corporations were major players. storing wastes more expensive. Mining Campaign (GMC), a network Nor will voluntary measures of communities and human rights, prevent the poorer performers from environment and development and undercutting the inevitably higher other organisations from all conti- The global airline industry has costs of the ‘responsible miners and nents, established in Washington DC some minimum mandatory minerals re-processors’. in December 2001. Through a standards as a condition of The WSSD therefore is an impor- comprehensive process of consulta- having a license to operate. tant forum for exposing and challeng- tion across the world, GMC has been ing the free trade agenda and de- actively lobbying in the lead up to manding instead a higher mandatory WSSD, preparing a set of demands standard of environmental and social for responsible minerals use, lobbying We can’t say that today. In the performance of corporations across to ensure that the section of the last few years most Australian com- the world, wherever they operate and WSSD on minerals is embedded in panies have been swallowed by wherever they are based. commitments to human rights and a overseas rivals. Rio gobbled up This is not such a far out call. The shift from ever greater mining to North, Billiton merged with BHP, global airline industry has some minerals conservation and reuse. Newmont took over Normandy, minimum mandatory standards as a The GMC has established a Placer is taking Aurion... the list goes condition of having a license to website ‘The Mining News’ on. Only WMC is left and the sharks operate. There is no reason why the (www.globalminingcampaign.org/ are circling there too. same principles cannot be applied to theminingnews.html) as a resource With capital raising and manage- the global mining and minerals for activists to document the experi- ment decisions increasingly being industry. ence of citizens around the world with made in London, Denver, Vancouver, the mining industry. Toronto and Johannesburg, Austral- The mining industry is active in the ian companies are being left to lead up to WSSD too. It is pressing implement decisions made in distant governments — particularly Australia offices. and Canada — to ensure contraints The merger mania of the mining on an ever-expanding mining industry industry is throwing up new chal- Geoff Evans are eased . It illustrates the impact of lenges for communities, environmen- mining on democracy with corpora- talists and human rights organisations Director tions — which can’t vote — often trying to ensure accountability and
Mining Monitor • June 2002 • page 11 Tailings: industry watch
Constitution, we will create the Ventures, appears doomed. Costa Rica security of absolute protection for The following day the government primary forests so that not a single of Nicaragua announced that it was tree there is cut; absolute protec- opposed to any open cut mining President wants tion for the aquifers and the rivers; developments in the San Juan River, country mine free the absolute protection for the which is shared between Nicaragua The tiny Central American nation of coral ecosystems, of the man- and Costa Rica. The following day Costa Rica is headed to become the groves and the wetlands; the the Costa Rican Minister of the first country in the world to ban open absolute protection of wild fauna Environment, Carlos Manuel cut mining and become free of oil and flora. Rodríguez, stated that exploration or exploration. In his inaugural speech We will create the legal system mining permits would not be issued in the newly elected President of Costa so that deforested areas will be the catchment. Rica, Dr. Abel Pacheco, empathically reforested with native species and declared his commitment to a future to make clear that we won’t be an for the country without reliance on oil oil enclave or land of open pit USA or mining. Here is a translation of his mining. speech. At the same time we will incor- ‘We will compete without destroy- porate in this new Chapter of the Mine assessment ing nature because, beyond the Constitution all that is necessary to stalled events of the moment, our rich ensure appropriate processes for biodiversity will always be a great treatment of solid waste; to begin a Legal action by a coalition of environ- wealth and we will preserve it. systematic process of recycling ment groups has forced the US Fish Before becom- and to foster the vigorous develop- and Wildlife Service to re-evaluate a ing an oil enclave, ment of organic agriculture. copper and silver mine proposed before becoming Added to this, we will guaran- adjoining and underneath the Cabinet a land of open pit tee Costa Ricans that technologi- Mountains Wilderness Areas in mining, I plan to cal developments; including the Montana. initiate a sus- genetic advances, will have to be The legal action centred on the tained effort to made in harmony with the nature. likely adverse impact of a mine on the The inclusion of Social Guaran- habitat for bull trout and grizzly bears. President of Costa transform Costa Rica, Dr. Abel Pacheco Rica into an tees, moved forward by Dr. Biologists estimate that the grizzly ecological power.’ Calderón Guardia, gave us social bear population in the Cabinet Moun- ‘The true fuel and the true gold of peace; the inclusion of the Chapter tains wilderness area may be as low the future will be water and oxygen; of Environmental Guarantees will as eleven. they will be our aquifers and our give us sustainability and survival. ‘This decision pushes back the forests. I call on all Costa Ricans, imminent threat of extinction, but only Before we declare peace among especially the youngest, to help temporarily. The Cabinet Mountains ourselves and we declare peace me with this initiative, to contribute grizzly remains on death row as long among all nations; now we should with their ideas, to reinforce with as the Rock Creek Mine remains in declare a peace with nature. their proposals their right to make the works’, said Earthjustice attorney Costa Rica does have a future. of this country a sanctuary for Tim Preso, who represents the As part of the effort to guarantee nature and for humanity. conservation groups challenging the 1 this promising future, I want to an- Costa Rica has a future and mining plan. The mine’s former nounce that I have adopted the we will assure it’. owner, ASARCO, sold the troubled proposal from a group of young The day after the President’s project to the Sterling Mining Com- 2 environmentalists that was transmit- inaugural speech, the San Carlos pany based in Washington state. ted to me by Gabriel Quesada, country council of the northern region of Costa Rica announced 1 “Lawsuit Prompts Withdrawal of Montana grandson of Víctor Quesada, editor of Mine Approval”, Environment News Service, the Social Guarantees and by my son that it would not permit any gold 28 March 2002, http://ens-news.com/ens/ Fabián and that I will press forward mining developments in the region. mar2002/2002L-03-28-09.html. 2 As local councils have veto power For more information see surely and decidedly, to incorporate www.rockcreekalliance.org. in the Constitution of the Republic a over the decisions of the central Chapter on Environmental Guarantees. government the proposal by gold As part of this new Chapter in the exploration company, Vanessa
12 Phone 61 2 9557 9019 • w w w.mpi.org.au • Email [email protected] Tailings: industry watch
Filling rivers faces sought – and been granted – legal structure the US attendance at legal challenge relief from the Bush administration. upcoming IPCC meetings to assure Their lavish contributions to the Bush- none of the Clinton/Gore proponents Cheney campaign have just been are involved in any decisional activi- In early May 2002 a US federal court paid back,’ Joan Mulhern said in a ties’. Randol also proposed that noted ruled as illegal permission granted by statement.3 climate sceptic, Dr Richard Linzden a US government agency to allow Haden’s decision was overturned be appointed to ‘conduct an immedi- river valleys to be filled with waste on appeal but further legal action is ate review of the comments on the rock from ‘mountaintop’ mining pending. A bipartisan group of fifty- Working Group reports … and to projects.1 While environmentalists seven members of Congress has review the US comments to be hailed the ruling as a significant announced that they will introduce submitted’. breakthrough, it was overturned on legislation to overturn the new rules. During the 1990s ExxonMobil appeal shortly afterwards. spent more than $1bn financing the Kentuckians for the Common- 1 Ken Ward Jr, ‘Judge blocks new valley fills Global Climate Coalition (GCC), a Corps of Engineers’ practice illegal, violates wealth initiated the original lawsuit, Clean Water Act, Haden rules’, West Virginia group of oil, motor and heavy indus- which drew a fierce response from Gazette, 9 May 2002, www.wvgazette.com/ tries opposed to action against global news/News/2002050838/ the coal warming.2 2 A link to the judgement and other court industry and documents is at www.wvgazette.com/news/ After release of the letter, a White the Bush News/2002050838/. House administration official claimed 3 Administra- Earthustice, ‘Bush Administration Approves that the decision to oppose Watson Most Damaging Change to Clean Water Act in tion. The Decades Allows Waste Dumps in Streams was unrelated to ExxonMobil’s ruling by Nationwide’, Media Release, lobbying. www.earthjustice.org/news/ Chief U.S. At the subsequent meeting IPCC Waste from “mountaintop mining” display.html?ID=365, 3 May 2002. obliterates adjoining rivers. District meeting, ExxonMobil’s lobbying came Judge to fruition, with Watson voted out of Charles H. Haden II in West Virginia Climate scientist the position. would have had the effect of prevent- toppled for EXXON 1 ing the Army Corps of Engineers from Memo from Randy Randol, Senior Environ- mental Advisor ExxonMobil to John Howard, authorising further projects that dump In response to lobbying by oil giant Council of Environmental Quality, 6 February waste in Appalachian valleys. ExxonMobil, the Bush administration 200.The memo is available as an Acrobat file at www.nrdc.org. A change by the Bush Administra- decided to oppose the candidacy of See also Natural Resources Defence Council tion early in May 2002 to the Army Dr Robert Watson to chair of the UN- (US), ‘Confidential Papers Show Exxon Hand Corps’ own regulations sought to auspiced Intergovernmental Panel on in White House Move to Oust Top Scientist from International Global Warming Panel’, overturn a 1977 rule prohibiting mine Climate Change (IPCC). The 2500- Media Release, www.nrdc.org, 3 April 2002. wastes being dumped into rivers. member IPCC drafts expert advice 2 Paul Brown, ‘Oil giant bids to oust expert on Haden’s decision was scathing. ‘The for policymakers on global warming climate’, The Guardian Weekly, 11 April 2002, page 5 final rule for ‘discharge of fill material’ and its causes. highlights that the rule change was Watson, a highly respected designed simply for the benefit of the atmospheric scientist and currently mining industry and its employees the chief scientist at the World Bank, …The agencies’ attempt to legalize had chaired the IPCC since 1996. their long-standing illegal regulatory A memorandum from ExxonMobil practice must fail . . . The regulators’ to the White House Council on practice is illegal because it is con- Environmental Quality was obtained trary to the spirit and the letter of the by the US based environmental Clean Water Act’, Haden’s decision organisation the Natural Resources stated.2 Defense Council (NRDC) under the The environmental law group, Freedom of Information Act. The Earthjustice, argued that the new rule memo was sent to Bush’s chief – introduced late on a Friday – was a environmental adviser just after he special favour for political donors. was sworn in as President and Whether it is back copies of Mining “Now that citizens have taken state identified as an issue ‘can Watson be Monitor, copies of MPI reports or and federal agencies to court to replaced now at the request of the news updates, drop in to the MPI ensure our environmental laws are US?’.1 website www.mpi.org.au enforced, coal companies have The memo recommended ‘Re-
Mining Monitor • June 2002 • page 13 Tailings: industry watch
Insubordinate support group for public employees.1 set the record straight in New Zea- advice Earlier in the year PEER released land. They need to withdraw from the the results of a survey of ADEC Pan Industry Group and clearly state An Alaska Department of Environ- employees reflecting a widespread their positions on climate change’ ment and Conservation (ADEC) perception of regulatory favouritism wrote Greenpeace campaigner, employee has been charged with toward the petroleum industry, political Robbie Kelman.1 insubordination for writing an e-mail manipulation of pollution enforcement The following day BP claimed that identifying legal problems with a and weak agency leadership. they had not participated in the proposed BP exploration project. coalition. It was a claim Greenpeace 1 Bill McClarence identified nine Public Employees for Environmental Respon- rejected pointing to a February 2002 sibility , ‘ADEC employee disciplined for legal problems with the proposed BP protesting BP permit’, Press Release, report produced on behalf of the permit. These included the failure to www.peer.org, 2 April 2002. Climate Change Pan Industry Group account for more than 25 tons of (CCPIG) which listed as one of its hazardous pollutants to be emitted members the Greenhouse Policy each year and the evasion of pollu- New Zealand Coalition (GPC) of which BP is a tion standards by improperly count- member. The Chair of the GPC itself ing the facility as a separate opera- had also written an opinion column for tion when it is part of a larger opera- BP outed on anti- a New Zealand newspaper titled tion. ADEC Manager John Kuterbach Kyoto lobbying ‘Nothing to gain from Kyoto Protocol”’ charged McClarence with insubordi- ‘BP cannot remain silent any nation for violating a direction that Greenpeace New Zealand revealed in longer. The company must make a MacClarence should not communi- May that despite BP and Shell publicly clear public statement on its stance cate regulatory problems to any staff claiming they supported the Kyoto on climate change, renounce the anti- members under his supervision. climate change convention both were Kyoto CCPIG and guarantee the ‘Bill MacClarence is being har- participating in a New Zealand coali- Greenhouse Policy Coalition (GPC) is assed for refusing to ignore major tion lobbying the government not to not associated with the CCPIG, or it pollution violations by ratify the convention. should remove itself from the GPC’, a favoured company’, Greenpeace wrote to both BP and Kelman said. stated Jeff Ruch, Shell demanding they withdraw from 1 Executive Director of the New Zealand Climate Change Pan Greenpeace New Zealand, ‘A decade of dirty tricks’, Media Release, 14 May 2002. Public Employees for Industry Group (CCPIG). ‘BP and 2 PEER Executive Greenpeace New Zealand, ‘BP New Environmental Shell’s hypocrisy is difficult to under- Zealand: too little, too late’, Media Release, 15 Director, Jeff Ruch. May 2002. Photo: Bob Burton. Responsibility stand. Both these companies need to (PEER) a legal
Cost cutting and that sinking feeling
‘Petrobas has established new global benchmarks for the generation of exceptional shareholder wealth through an aggressive and innovative program of cost cutting on its P36 production facility. Conventional constraints have been successfully challenged and replaced with new paradigms appropriate to the globalised corporate marketplace through an integrated network of facilitated workshops the project successfully rejected the established constricting and negative influences of prescriptive engineering, oner- ous requirements and outdated concepts of inspection and client control. Elimination of these unnecessary straightjackets has empowered the projects’ suppliers and contrac- tors to propose highly economical solutions with win-win bonus of enhanced profitability margins for themselves. The P36 platform shows the scope of things to come in [the] unregulated global market economy of the 21st century’.
A statement by a Petrobas executive prior to an explosion on the P36 oil platform in the Atlantic Ocean off Brazil in March 2002 which killed ten workers and resulted in the platform sinking.1
1 American Oceans, ‘Quality assurance and the sinking of the largest offshore oil platform’, March 2001, www.americanoceans.org/oil/main.htm.
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also reviews the PR aspects of 1YJ, United Kingdom. Reports corporate ‘dialogue’ meetings with critics and the increasing corporate influence in United Nations agencies. Friends of the Earth – Netherlands This report is available at www.thecornerhouse.org.uk/briefing/ ‘Raw Materials versus Poverty?’: A conference on the role of the World Bank 26codes.html in financing fossil fuel and mining projects. September 2001, 4 pages.
This is a brief report on a public forum organised by Friends of the Earth Netherlands last year on whether the World Bank should continue to be involved in funding mining and energy projects. If you have been following the debate over the role of mineral Lisa Sumi, Sandra developments in creating rather than Thomsen and Alan Young alleviating poverty this is worth Follow the mining money: an activist reading. toolkit for direct corporate campaigning Western Mining Activist Network, November The report is available at 2000, 38 pages. Nicholas Hildyard and Mark www.milieudefensie.nl/wto/ Mansley publicaties/ This is a very useful guide for cam- The campaigners guide to financial reportconferenceworldbank.pdf paigners who want to develop their markets: effective lobbying of companies skills in lobbying those companies and financial institutions, financially supporting mining compa- nies. While not as comprehensive as The Corner House, October 2001, 204 pages. Gary Scott and Mark Hildyard’s and Mansley’s (see below) Wakeham This is a comprehensive guide for more recent contribution, this pro- Uranium Exploration in West Arnhem public interest groups keen to under- vides plenty of useful background Land: a report for the Environment stand the potential of lobbying the information and pointers to free Centre Northern Territory and the Austral- financial markets, shareholders and resources.It is well worth reading. ian Conservation Foundation banks as part of campaigns to protect November 2001, 36 pages. human rights and the environment. The report is available from http// While the guide concentrates on the emcbc.miningwatch.org This paper reveals, through detailed major UK and UK financial institu- maps, the increase over the last five tions, it provides plenty of pointers years in uranium exploration in and case studies on how campaigns Arnhem Land. The report examines can effectively advance their goals. the background to mineral exploration Judith Richter The guide also contains an 80-page on Aboriginal land in the Northern Codes in Context: TNC regulation in an guide to researching companies and Territory and some of the current era of dialogues and partnerships industry sectors with a big list of uranium exploration programs. The Corner House, February 2002, 204 pages. recommended websites and library resources. The report is available at This paper challenges the greater www.ecnt.org/uranium/ reliance on self-regulation of corpo- Zipped PDF files are available from west_arnhem.htm rate activities – including by some [email protected]. Printed non-government organisations – copies for non-profit groups cost £27 rather than binding legal regulation. (including airmail costs) with payment Richter illustrates the limits of self- by cheque only made out to ‘Corner regulation by examining the corporate House Research’, The Corner House, response to the voluntary code on PO Box 3137, Station Road, breast milk substitutes. The paper Sturminster Newton, Dorset DT10
Mining Monitor • June 2002 • page 15 N uggets
Miners cure for insomnia Buck passing ‘The international report is 566 pages long. If you suffer from insomnia then I highly recom- The international Minerals, Mining and mend it for night-time reading’. Sustainable Development project, com- missioned by the world’s largest min- The President of the Minerals Council ing companies, ‘did not address climate of Australia [MCA], Barry Cusack, ex- Happy to be hijacked change. The issue was considered too large and plaining the highlights of the final re- complex to be addressed within the project’s port of the industry sponsored Mining, ‘It [the MCA] has been very quick to hijack me time and resource constraints. There were also Minerals and Sustainable Development and my staff’. significant national and international processes (MMSD) process. Australia’s Minister for Industry, Tour- pushing forward our understanding and devel- oping responses in this area, and little value to (Source:James Chessell, ‘Greed’, The Age, 19 ism and Resources, Ian Macfarlane. April 2002.) be added by duplicating effort’. (Source: Macfarlane addressing the Minerals Council of Australia’s Minerals Industry Semi- (Source: Australian Minerals and Energy Envi- nar, 5 June 2002.) ronment Foundation (AMEEF), Facing the Fu- ture: The Report of the MMSD Australia Project, Minerals, Mining and Sustainable Development, Australia, AMEEF, April 2002, page 50.)
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