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Strategic Measures in Sangan Iron Ore Mines Based on Sustainable Development Indicators and Stakeholder Surveys

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Strategic Measures in Sangan Iron Ore Mines Based on Sustainable Development Indicators and Stakeholder Surveys STRATEGIC MEASURES IN SANGAN IRON ORE MINES BASED ON SUSTAINABLE DEVELOPMENT INDICATORS AND STAKEHOLDER SURVEYS Jürgen Kretschmann Prof. Dr., President of TH Georg Agricola University, Bochum, Germany *Ravanbakhsh Amiri Dr.-Ing., Managing Director of Zarshouran Gold Mines and Mineral Industries Development Company, Tehran, Iran (*Corresponding author: [email protected]) STRATEGIC MEASURES IN SANGAN IRON ORE MINES BASED ON SUSTAINABLE DEVELOPMENT INDICATORS AND STAKEHOLDER SURVEYS ABSTRACT Iran with roughly 1% of the world’s population holds more than 7% of the world’s total mineral reserves. There are 68 types of mineral, with an estimated value of $700 billion. The total proven reserves of metallic and non-metallic deposits are estimated at 55 billion tons. Hence, it is of immense importance to have a strategy to exploit these resources. However, the success of the industry depends on economic, environmental, social, political and other impact factors. Without a sustainable development approach, the production of raw materials loses its stakeholders´ acceptance in the mining region. This paper is based on the results of a study about Sangan Iron Ore Mines (SIOM) in Iran. The first aim of the study was to select the most appropriate sustainable development indicators for assessing the status of SIOM. In a two-stage process, suitable indicators have been selected according to defined criteria, and prioritized using the Fuzzy Delphi Method. The output was a set of 15 indicators with the highest priority for the stakeholders of this mining project. To gain a better insight into the stakeholders’ perceptions of the development of SIOM, two questionnaires were designed and distributed among prominent stakeholders and households in the region. Based on the responses, main expectations of the communities from the mining project were determined. Considering the analysis of the sustainable development indicators and the results of the questionnaires, strategic measures for SIOM have been derived to secure the strategic sustainability of SIOM. This methodology provides a comprehensive insight for decision makers in the mining industry worldwide to implement tailor-made sustainable development approaches for their individual projects. KEYWORDS Sangan Iron Ore Mines, Sustainable Development Indicators, Stakeholder Analysis, Strategic Management INTRODUCTION The quest for minerals has undoubtedly brought wealth and civilization and accelerated development to many parts of the world (Darling, 2011). Basically, sustainable development (SD) is an ethical concept described as a development that meets the needs of the present without compromising the ability of future generations to meet their own needs (WCED, 1997). In the minerals sector, SD means that investments in minerals projects should be technically appropriate, financially profitable, environmentally sound and socially responsible. Economic development, environmental impact and social responsibilities must be well managed, and productive relationships must exist between governments, industry and stakeholders. Achieving such a situation is simply a ‘good way to do businesses (Commonwealth of Australia, 2006). Acting sustainably means to take a long-term, whole-of-business strategic view. Leading mining companies have recently formulated, and pledged to follow standards and principles for SD of mineral resources worldwide (Nelson, 2011). Iran with roughly 1% of the world’s population holds more than 7% of the world’s total mineral reserves. There are 68 types of mineral, with proven reserves of 55 billion tons and an estimated value of $700 billion. Iran is currently the 15th most mineral rich country (Hannam & Partners, 2015; USGS, 2017). Hence, it is of immense importance to have a national strategy to exploit these resources. However, the success of the industry depends on economic, environmental, social, political and other impact factors. Without a sustainable development approach, the production of raw materials loses its stakeholders´ acceptance in the mining regions. STUDY AREA: SANGAN IRON ORE MINES (SIOM) The deposit of SIOM is one of the largest iron-ore deposits in Iran, also considered to be one of the Middle East’s richest deposits, which contains a total geological resource of 1.2 billion tons of mostly magnetite with a Fe grade ranging from 27 to 61%. It is located in the north-eastern Khorasan-e-Razavi Province, 300 km southeast of Mashhad - the capital - and 18 km northeast of Sangan town, in Khaf County, 30 km west of the Afghanistan border (Kretschmann and Amiri, 2013b) (Figure 1). Figure 1 - Geographical location of study area SIOM is owned by the Iranian Mines and Mining Industries Development & Renovation Organization (IMIDRO). IMIDRO intends to develop an open pit mine complex and supporting facilities in SIOM for the production of about 20 Mtpy of iron oxide concentrate and pellets in different developing phases with the cooperation of private sector (Kretschmann and Amiri, 2014). During the development of the mining complex, a series of economic, environmental and social measures were implemented in the Sangan area which are shown in table 1. In general, these activities have contributed positively to the development of the region. Figure 2 - Girl high school (left) and new technical school (right) in Sangan town Table 1 - Measures implemented to support a sustainable development in SIOM (Kretschmann and Amiri, 2015) Sustainable Measures Description Development Pillar Construction of the first Established in 1992, budget ca. 265,000 USD high school for girls Construction of a new Established with partners in 2001, budget ca. technical school 484,000 USD A joint charity fund was established in 2004 by Charity fund employees and companies, budget 57,000 USD (till 2012) Financial support of local governmental and non- Sponsoring of local governmental organizations in Khaf country ; organizations Social budget ca. 294,000 USD (Kretschmann and Creating employment Creation of 1610 new direct jobs until 2011 Amiri, 2013a) Signing a contract in 2012 with Univer- Improving occupational sity of Tehran to prepare a HSE guideline safety and health for SIOM Decrease in incident frequency rate from 8.63 in 2003 to 0.3 in 2012 The perspective of a better future and the Decreasing criminal economic improvement in the region has reduced activities in the region drug smuggling and criminal activities like robbery, murder or addiction (Tavakoliroodi, 2012). Signing a contract in 2004 with an engineering Preparation of EIA report company for conducting environmental impact assessment studies An environmental management plan is prepared Environmental for each environmental impact through the Preparation of EMP report (Kretschmann and mining activities in both construction and Amiri, 2013a) operational phases Signing a contract in 2006 with Tarbiat-e- Frequent monitoring and Modarres University for monitoring and auditing auditing program various pollutants in the field and regular reporting Improvement in The overall situation of the region has been infrastructures and other enhanced due to the foundation of different facilities industries in the vicinity. Economic Pursuant to mining industry growth, other major (Kretschmann and Growth of Industry Section and minor industries were located in the region Amiri, 2013a) Development of Road Increased from 0 in 1981 to 283 km in 2013 Construction Development of Railways Increased from 0 in 1981 to 112 km in 2013 SELECTION OF SUSTAINABLE DEVELOPMENT INDICATORS FOR SIOM Measuring the realization of sustainable development in a mining project is a complex process. Chapter 40 of the Agenda 21 calls on countries and the international community to develop indicators of sustainable development (SDI). Such indicators should increase the focus on sustainable development and assist decision-makers to adopt sound sustainable development policies and strategies (DESA, 2007). Sustainable Development Indicators of SIOM To select the most appropriate indicators for SIOM, sustainable development indicators were chosen from core set of CSD indicators (DESA, 2007) on a basis of a two stage process. Firstly, the indicators were selected by the criteria availability, authenticity, possibility of quantification, application in the study area, possibility of detecting along term trend and citation in relevant scientific literature. Indicators that could not be measured in the long run due to a poor availability of data in the region had to be eliminated. Selected indicators were from three groups as follows (Amiri, 2016): Economic indicators: Length of Roads, Length of Railway, Increase in family’s income, Farmers’ income, Employment- population ratio, Share of women in wage direct employment in the mining sector, Ratio of annual Electricity consumption in mining sector to total energy consumption in Khaf County. Environmental indicators: Water quality, Average depth of aquifers, Water consumption in Sangan mining complex, Wastewater production, Air quality, Solid waste production, Ratio of sanitary disposed solid waste to total solid waste produced, Ratio of sanitary disposed solid waste to total solid waste produced and Ratio of sanitary disposed solid waste to total solid waste produced. Social indicators: Access to primary sanitary facilities, Access to potable water, Access to electricity and other energy sources, Under-five mortality rate, Nutrition status of residents, Immunization against infectious childhood diseases, Net enrolment rate
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