Category Archives: Uncategorized

Rampal power plant – condemned by Norwegian Ethics Council

Published by MAC on 2018-03-21

Norway’s Council on Ethics advises the Government Pension Fund Global on its investments, making recommendations that a company’s be excluded from its portfolio, and/or is closely observed in its performance.

Since 2007, the Council has published sufficient evidence to convince the Pension Fund (the world’s largest of it kind) to disinvest from several major global mining companies, including Vedanta, Barrick Gold and Rio Tinto.

In its latest annual report, released last week, it makes just one recommendation to exclude a mining/mining-related enterprise – and the Pension Fund has duly done so.

That company is BHEL, partnered with NTPC – two Indian state-owned enterprises wanting to construct the huge Rampal coal-fired power plant in the Sunderbans wetlands that stretch between southern coastal Bangladesh and India. (See also: Bangladesh: police fire tear gas, rubber bullets against Sunderbans protesters ).

Summaries of recommendations published since the previous annual report

Council on Ethics report

Norway

9 March 2018

Bharat Heavy Electricals Ltd.

Case submitted 8 December 2016

The Council on Ethics recommends the exclusion of Bharat Heavy Electricals Ltd. (BHEL) from the Government Pension Fund Global (GPFG) due to the unacceptable risk of the company being responsible for severe environmental damage through its operations in Khulna, Bangladesh.

BHEL has been awarded a contract to build a large coal-fired power plant in southern Bangladesh. The power plant is to be built close to the boundary of the Sundarbans national conservation area, the world’s largest mangrove forest. The entire area is also a Ramsar area. It is rich in biodiversity and contains several protected species, including Bengal tigers and river dolphins.

The conservation area also encompasses two world heritage sites in Bangladesh, as well as a further world heritage site on the Indian side of the border.

Two factors mean that the project carries a substantial risk of environmental damage. Transport to the power plant during the construction phase will mainly be by boat through the Sundarbans. The sailing route to the anchorage site passes very close to the boundary of a world heritage site.

Transhipment and transport operations will raise the risk of mishaps and accidents involving emissions/discharges very close to vulnerable areas, and this risk is a direct consequence of the power plant and its location.

Another risk is linked to the fact that huge river-bed and seabed areas will be dredged. When large volumes are removed from the riverbed or dumped, the volume of particles transported by the currents increases substantially.

There is a great risk that this activity may place further strain on the already endangered mangrove forest and life in the river and appurtenant marine areas, which are also important to the local population.

At the same time, the river-bed conditions will change in protected areas for endangered river dolphins.

The Council on Ethics initially contacted BHEL on 19 May 2016. The company did not reply to the Council’s inquiries initially, but has later submitted comments to a draft recommendation.

The company states in the comments that there is no need to dredge the waterways.

The Council considers it highly unlikely that a coal-fired power plant can be built at this location without the construction work itself constituting a high risk of severe environmental damage, even if extensive new measures are implemented.

In the present case, the company has also failed to sufficiently assess what needs to be done to protect the environment.

Further, various transportation factors have not been addressed and handled satisfactorily. Overall, this indicates a significantly increased risk of unnwanted incidents in a unique, highly vulnerable area. The Council has also given considerable weight to the strong concern expressed by UNESCO regarding the risks associated with the project and the fact that the IFC recommendations for such situations have not been observed.

The Council on Ethics recommends the exclusion of Bharat Heavy Electricals Ltd. (BHEL) from the Government Pension Fund Global (GPFG) due to the unacceptable risk of the company being responsible for severe environmental damage through its operations in Khulna, Bangladesh.

BHEL has been awarded a contract to build a large coal-fired power plant in southern Bangladesh. The power plant is to be built close to the boundary of the Sundarbans national conservation area, the world’s largest mangrove forest.

The entire area is also a Ramsar area. It is rich in biodiversity and contains several protected species, including Bengal tigers and river dolphins. The conservation area also encompasses two world heritage sites in Bangladesh, as well as a further world heritage site on the Indian side of the border.

Two factors mean that the project carries a substantial risk of environmental risk.

Transport to the power plant during the construction phase will mainly be by boat through the Sundarbans. The sailing route to the anchorage site passes very close to the boundary of a world heritage site. Transhipment and transport operations will raise the risk of mishaps and accidents involving emissions/discharges very close to vulnerable areas, and this risk is a direct consequence of the power plant and its location.

Another risk is linked to the fact that huge river-bed and seabed areas will be dredged. When large volumes are removed from the riverbed or dumped, the volume of particles transported by the currents increases substantially.

There is a great risk that this activity may place further strain on the already endangered mangrove forest and life in the river and appurtenant marine areas, which are also important to the local population. At the same time, the river-bed conditions will change in protected areas for endangered river dolphins.

The Council on Ethics initially contacted BHEL on 19 May 2016. The company did not reply to the Council’s inquiries initially, but has later submitted comments to a draft recommendation. The company states in the comments that there is no need to dredge the waterways.

The Council considers it highly unlikely that a coal-fired power plant can be built at this location without the construction work itself constituting a high risk of severe environmental damage, even if extensive new measures are implemented.

In the present case, the company has also failed to sufficiently assess what needs to be done to protect the environment. Further, various transportation factors have not been addressed and handled satisfactorily.

Overall, this indicates a significantly increased risk of unwanted incidents in a unique, highly vulnerable area. The Council has also given considerable weight to the strong concern expressed by UNESCO regarding the risks associated with the project and the fact that the IFC recommendations for such situations have not been followed.

UNESCO has reviewed the project again in 2016 and calls for its cancellation or relocation.

SOURCE: http://www.minesandcommunities.org/article.php?a=13755

India: With Goa’s MLAs Set to Ask for Mining Lease Extensions, the Politician-Miner Nexus Comes Full Circle

By Claude Alvares and Rahul Basu on 04/03/2018

The Wire

4 March 2018

The state’s politicians could’ve used recent court judgments as an opportunity to carry out reform. Instead, they will plead with the Centre to extend mining leases further.

A delegation of members of legislative assembly (MLAs) from Goa are headed to Delhi on Monday. They will plead with the Centre for an ordinance to retrospectively amend a 1987 Act, so that existing mineral leases get automatic extension for another 20 years (till 2037).

In effect, this is a plea by Goa’s ruling politicians to regularise illegal mining from November 23, 2007 till date – the amounts recoverable from Goa’s miners likely exceed Rs 1,00,000 crore – and to hand over another tranche of public money valued at another Rs 1,00,000 crore to the same illegal miners, instead of getting the state the best value through public actions.

To apply the Supreme Court’s words used by it in its recent Goa mining lease renewal case, “the inferences that can be drawn are obvious”.

Natural resources, including minerals, are a shared inheritance, owned by the state in trust for the people and especially future generations. It is our duty to ensure that we protect our inheritance for future generations. Only if we do that may we consume the fruit. A loss is a loss to our children and all future generations.

In the run-up to the Beijing Olympic games, the demand for iron ore soared. The resulting iron ore mining boom in Goa led to a free-for-all situation, with the environment being devastated and laws being violated. In response, the Goa government set up a public accounts committee (PAC) under Manohar Parrikar to examine mining. The PAC observed:

“There is a complete breakdown of all machineries provided by the statute which are required to ensure that mining is undertaken and carried out in a legally permissible manner. The term ‘irregular mining’ is nothing but illegal mining.”

The Centre set up the Justice M.B. Shah commission to examine illegal mining in Goa. After visiting Goa, it wrote:

“Inaction, delayed action and mild actions have had created fearless atmosphere, abuse of law and regulations in the Goa state. This has paved ways for large scale irregularities, illegalities and corruption. … The regulatory mechanism has been totally collapsed and irregularities due to maladministration have risen to its peak. In the process, the sole loser is environment, eco-system of the Western Ghats, general public and treasury of Goa state.”

“It is pertinent to state here that such illegal acts can’t happen without connivance of the politicians, bureaucrats and lessees. There is a complete collapse of the system.”

Riding the anti-corruption surge and the leaked PAC report, the BJP led by Manohar Parrikar won a majority in Goa’s legislative assembly elections in February 2012. A key promise was to clean up corruption.

Goa mining case

Following the Shah commission report, Parrikar banned mining in Goa on September 10, 2012. In the subsequent PIL filed by the Goa Foundation (GF), the Supreme Court issued a historic judgement in April 2014.

Some of the key rulings were:

All mining leases had expired on November 22, 2007,and mining done thereafter for five years was illegal

The Goa government would have to issue fresh leases, keeping the laws and constitution in mind

On grounds of intergenerational equity, an interim cap was imposed of 20 million tonnes per annum (mtpa)

A fresh levy of 10% of the sale value was imposed to be deposited in the Goa Iron Ore Permanent Fund for future generations

A number of other illegalities alleged were left to the Goa government to pursue. The period of illegal mining was under Digambar Kamat of the Congress.

Goa now had a clean slate. No existing leases. The recoverable due to nearly 5 years of 100% illegal mining was conservatively estimated at Rs 65,058 crore, or Rs 4.5 lakh per person (Goa Foundation). Recent claims by the Goa Mineral Ore Exporters Association (GMOEA) – that Goa exported $7 billion of iron ore each year before 2012 – would lead to recoverable amounts of over Rs 2,04,750 crore!

Mining lease renewals

Less than a month after the SC judgment, in May-2014, the BJP won a historic majority in the general elections, promising that natural resources would henceforth only be auctioned. Keeping with its promise, in November 2014, it introduced a bill for public consultation providing that henceforth mining leases could only be granted to private players through auctions. Only public sector undertakings (PSUs) could still be allotted mineral leases without an auction.

Back in Goa, Parrikar ruled out auctions and PSU mining despite the BJP manifesto. Auctions raised the threat of the unknown mining mafia coming into Goa, he said, and PSU mining raised the possibility of corruption and misgovernance. Instead of recovering the amounts legally due from the miners and either auctioning mines or mining under a PSU, the BJP government, initially under Manohar Parrikar and later under Laxmikant Parsekar, renewed 88 mining leases.

Not just renewed leases, but back-dated their period of validity to November 22, 2007.

In effect, this gave up the claim of Rs 65,058 crore. Also, as the leases would continue on the old regime without auctions, a further Rs 79,865 crore would be handed over during the remaining life of the leases (to expire November 22, 2027). All in all, a total grant from the Goa government to the miners of Rs 1,44,865 crore (or Rs. 10 lakh per Goan).

An important justification was the disruption to the income of the mining dependent. Over the years, approximately Rs 300 crore has already been spent for the mining dependents, mostly for truck and barge owners.

Mining restarted on August 10, 2015. Within two years, Goa witnessed massive air pollution violation in Sonshi village, when the Bombay high court took suo motu notice, as did the state Child Rights Commission and the state ST Commission. Simultaneously, using the mining surveillance system, 12 new cases of illegal mining were detected.

Goa lease renewal case

Three groups of petitioners – Goa Foundation, Sudip Tamankar, and a group lead by Rama Velip – filed cases in the Supreme Court challenging the renewals and a related high court order directing them. On February 7, 2018, in a scathing judgment, the SC quashed the mining lease renewals, but gave the miners until March 16, 2018 to manage their affairs. The SC said:

“The state ignored the fact that every single mining lease holder had committed some illegality or the other in varying degrees.”

“With the mining lease holders violating virtually every applicable law or legal requirement, it is clear that the rule of law was not their concern.”

“It was observed by Justice Khehar in Natural Resources Allocation that material resources of the country should not be dissipated free of cost or at a consideration lower than their actual worth. This was not kept in mind and mining leases were renewed for a small payment of stamp duty and royalty. It is therefore clear that the considerations that weighed with the State were not for the people of Goa but were for the mining lease holders.

“The entire exercise undertaken by the state was a hasty charade, regardless of violations of the law by the mining lease holders, without any benefit to the Indian industry and without any concern for the health of the average Goan.”

“…Without making any serious attempt to recover such huge amounts, the State of Goa has granted second renewal of mining leases and the MoEF played ball by lifting the abeyance order in respect of the environment clearances. The inferences that can be drawn are quite obvious.”

In effect, the position from the previous judgment has been restored. Mining after November 22, 2007 is illegal. Even larger amounts are recoverable, more than enough to provide for any further doles to the mining dependents.

MLA delegation

Goa can restore the environment first and simultaneously pursue recoveries. Dumps the size of 300 Giza pyramids litter the state, using up land. An estimated 150 million tonnes are saleable if we remove the iron ore from these dumps alone. (There are several other valuable minerals in these dumps, discarded as waste.)

Numerous mining pits and quarries have been abandoned, even in wildlife sanctuaries. Agricultural fields & river bottoms are coated with iron ore, at times a metre thick. Dump mining could be conducted by a PSU, with auctions of the raising contract and the iron ore for sale. This would utilise the mining cap for at least 8 years, giving the land some breathing time and space to recover health. Recoveries are to be saved in the permanent fund, and only the real income distributed as a common dividend. This option, advocated by the Goenchi Mati (Goan Earth) Movement, would create jobs, provide a shared prosperity and restore a green Goa.

SOURCE: http://www.minesandcommunities.org/article.php?a=13746

Tanzania: Court Remands Four Miners for Deliberate Environmental Destruction

1st March 2018
FROM DAILY NEWS REPORTER IN GEITA

GEITA Resident Magistrate’s Court on Monday remanded four workers of the Nyarugusu Mine Company Limited for unlawful use of a tailing storage facility contrary to Regulation 40 and 176 of the Mining Regulations 2010, and for disobeying a lawful order contrary to section 124 of the Penal Code.

The remanded prisoners facing three counts are Julius Malemi (41 years), Ludovick de Ferranti (27), Fredrick Robert Masanja (51) and Allen Francis Noni (31). Another mention will be on March 1, when the court will consider the prisoners’ bail application.

State Attorney Anosisye Erasto alleged before Principal District Magistrate Mrisho Kaliho Mrisho that the four accused on February 23, this year, at Ziwani village in the district and region of Geita disobeyed a lawful order issued on December 6, 2017 to Nyarugusu Mine by Acting Director General of National Environmental Management Council (NEMC), Dr Vedast Makota.

The attorney also alleged that the accused failed to undertake environmental impact certificate contrary to section 81(1)(2)(3)(4) and 191 of the Environmental Management Act, 2004 read together with Regulation 60(1) and (2)(b) of the Environmental Impact Assessment and Audit Regulation, 2005.

The accused, the attorney said, on February 23, this year, were found unlawfully operating a tailings (poisonous mud) storage facility without an environmental impact assessment certificate.

He also alleged that the accused on the same day used unlawfully the tailing storage facility without written permission from the chief inspector of mines. He told the court that unlawful use of the facility contravenes regulation 40 and 176 of the Mining regulations, 2010 made under 112 of the Mining Act, 2010. Magistrate Mrisho ordered the accused to be remanded until March 1, this year.

SOURCE: https://www.dailynews.co.tz/index.php/home-news/56176-court-remands-four-miners-for-deliberate-environmental-destruction-africa

Tanzania: JPM Does Us Proud On Tanzanite

Brown Jonas
28th February 2018

AFTER the works to build a concrete wall measuring 24.5km around the Mirerani mining quarries–the only area we can find tanzanite gems in the whole wide world–is complete, a new capping project to install electrified wiring around the entire distance will start.

Indeed, the idea itself came from a ‘presidential directive’ as if the rest of us were accomplices in the theft of the gemstones by all manner of ‘rat-routes’ to foreign countries, including a neighbouring country (unfortunately) and the Asian sub-continent.

The Head of State was very emphatic: The 3.2m wall isn’t enough to keep off the ‘rats’ of intruders…the fort needs to be reinforced with electric fencing as well as surveillance cameras and other security related electronics.

The Chief of the Armed Forces, General Venance Mabeyo, agrees. At his recent visit to the area, the general said the ‘Great Wall of Mirerani’ now stands as ‘flood-proof’ because all the waterways which caused havoc during the rains have since been sealed off – providing just a single entrance and exit gate to ensure that security is maintained.

At the event, the CDF met heads of security at the nowfamous Great Wall of Mirerani, built specifically to protect the tanzanite gemstones, rare across the globe. This was a rare incidence for an equally unique reason.

All sorts of ‘thieving’ seems to be going around our mining sites. Indeed, we’ve had occasion to point out that many countries in Africa are as generous as we’ve been with some of our so-called investors in the mining sector – which is why we should all support the President in his efforts to safeguard our economy in this sector.

Yet building a wall around the Mirerani, or any other mining area, for that matter, isn’t the ultimate solution. We should deal with the ‘thieves’ much more decisively than hitherto.

Mirerani isn’t that big; so any foreigners coming into it, and the locals who facilitate illicit trade in gemstones, are also easy to spot. Laissez-faire, the French would say. But that’s past tense, we should say, given current government efforts to rein in the crooks.

In the same vein, we should also urge for more efforts to preserve this country’s natural resources elsewhere in our collective development effort; again, we should stress that we’re just too generous when it comes to dealing with ‘investors’ who come with virtually empty pockets and leave ‘loaded’ with wealth.

We aren’t advocating protectionism, just stewardship.

SOURCE: https://www.dailynews.co.tz/index.php/editorial/56163-jpm-does-us-proud-on-tanzanite

Tanzania Mining Law to Lock Out Foreign Banks

17th February 2018

By Beatrice Materu

In Summary

– Mining Regulations on Local Content (2018), which came into effect in January, require mining companies to have a bank account in a Tanzania-owned bank in the country.

– The move is aimed at checking capital repatriation to miners’ countries of origin.

– Economists have praised the new regulation as a boon for local banks.

The ongoing reforms in Tanzania’s mining sector could lock foreign commercial banks out of the mining sector as new regulations require miners to use the financial services of local banks.

The Mining Regulations on Local Content (2018), which came into effect in January, require mining companies to have a bank account in a Tanzania-owned bank in the country.

The law defines a local bank as one that has 100 per cent Tanzanian or a majority Tanzanian shareholding.

The move is aimed at checking capital repatriation to miners’ countries of origin.

Experts say the new arrangement may require Tanzanian banks, which have foreigners as majority shareholders, to consider restructuring their shareholding in order to comply with the requirement and retain mining clients.

The regulation is expected to affect international banks like Barclays; Standard Chartered Plc; Stanbic Bank; First National Bank Tanzania Ltd — which is 100 per cent owned by the First Rand Group, a large financial services provider based in South Africa; KCB Bank, Commercial Bank of Africa and Access Bank Plc.

There are over 40 banks in the country.

Boon for local banks

Former chairman of the Tanzania Extractive Industry Transparency Initiative Multi-Stakeholders Working Group, Mark Bomani, said that during the review of the Mining Act companies had argued that local banks lacked the capacity to handle their accounts.

Economists have praised the new regulation as a boon for local banks.

Before the new rule was passed, mining firms were allowed to have bank accounts abroad and repatriate some of their profits — a move the government feels was weakening the local currency.

Calls for a change in the mining law were due in part to claims that mining firms were evading tax. The new structure seeks to establish even participation in mining activities by local entities including contractors, subcontractors, insurance companies and financial institutions.

Heft penalties

To avoid fraudulent practices, the law imposes heavy penalties on those who fail to comply.

“A citizen who acts as a front or connives with a foreign citizen or company to deceive the Local Content Commission as representing a local Tanzanian company to achieve the local content requirement under these regulations, commits an offence and is liable on summary conviction to a fine of not less than Tsh100 million ($44,000) and not more than Tsh250 million ($110,000) or to a term of imprisonment of not less than one year and not more than five years or both,” says Section 49 (2) of the law.

Section (3) reads: “A person who connives with a citizen or a local Tanzanian company to deceive the Commission as representing a local Tanzanian company…commits an offence and is liable on summary conviction to a fine of not less than Tsh1 billion ($450,000) and not more than Tsh10 billion shillings ($4.5 million) or to a term of imprisonment of not less than five years and not more than 10 years or to both.”

Tanzanite

Meanwhile, a team set up by the president to probe tanzanite mining has started negotiations with gemstone mining company Tanzanite One Mining Ltd to address setbacks affecting the sector.

The team was formed to ensure laws are followed and Tanzanians benefit from the natural resource, which is only found in Merelani Hills.

“We have started discussing ways to handle the different challenges affecting tanzanite business while also safeguarding Tanzanian’s interests,” said Palamagamba Kabudi, Tanzania’s Minister for Justice and Constitutional Affairs who is also a member of the team.

Faisal Juma Shahbhai, director of Sky Associates, owners of Tanzanite One Mining Ltd, said they support government efforts to ensure that the rare minerals benefit the country.

President John Magufuli has repeatedly voiced concern that Tanzanians do not benefit from their natural resources and has committed to gaining back control of the country’s extractive industry.

Mid last year, parliament fast-tracked three new laws that introduced extensive legal and regulatory changes to the country’s extractives industry.

They were the Natural Wealth and Resources Contracts (Review and Re-Negotiation of Unconscionable Terms) Bill, 2017; the Natural Wealth and Resources (Permanent Sovereignty) Bill, 2017; and the Written Laws (Miscellaneous Amendments) Act, 2017.

SOURCE: http://www.theeastafrican.co.ke/business/Tanzania-mining-law-to-lock-out-foreign-banks/2560-4308680-ccvfjfz/index.html

Kenya: UK Company to Survey Sh161 Billion Kakamega Gold

By Victor Juma

19th February 2018

In Summary

– The announcement is a signal that the multinational could soon join Goldplat which mines the commodity in Migori.

– At a total of 1.1 million ounces, the recoverable deposits are worth an estimated Sh160.8 billion based on the price of Sh137,430 per ounce on Friday.

– Increased gold production will diversify the country’s exports, help to fund government expenditure and shore up the local currency from dollar receipts.

——-

Acacia Mining, a British company that has been exploring for gold in Kakamega, says it has started a survey to establish commercial viability of the deposits estimated at 1.1 million ounces of the precious metal.

The announcement is a signal that the multinational could soon join Goldplat which mines the commodity in Migori.

“The updated inferred resource estimate completed for the year-end returned … 1.044 million ounces at Isulu and for Bushiangala 126,600 ounces,” Acacia said of its Kakamega sites in a trading update.

“A technical study to determine mineability of these deposits was commenced in Q4 2017.”

At a total of 1.1 million ounces, the recoverable deposits are worth an estimated Sh160.8 billion based on the price of Sh137,430 per ounce on Friday.

The study comes after Acacia intensified exploration activities in western Kenya, which cost it $12.2 million (Sh1.2 billion) in the year ended December, up from $10.5 million (Sh1 billion) a year earlier.

The recent rally in gold prices is expected to encourage production around the world. The current price of about $1,360 per ounce, a 20-month high, represents a gain of 20 per cent from lows of $1,133 in December 2016.

Increased gold production will diversify the country’s exports, help to fund government expenditure and shore up the local currency from dollar receipts.

Acacia, for instance, paid $143 million (Sh14.4 billion) in royalties and taxes to the Tanzania government where it has some of its largest operations.

Gold exports from Kenya have, however, been sluggish so far. Goldplat’s local subsidiary Kilimapesa Gold, for instance, sold about Sh374 million worth of the precious metal in the six months ended December — boosted by increased production at its Migori plant.

Kilimapesa’s output rose 2.2 times to 2,681 ounces in the period compared to 1,190 ounces a year earlier, the multinational disclosed in regulatory filings.

The company’s gold sales rose 2.4 times to 2,720 ounces from 1,093 ounces, placing the value of the commodity sold in the review period at Sh374 million.

The royalty rate the company pays to the Kenyan government was not immediately clear but miners of other commodities are paying royalties in the low single digits.

SOURCE: https://www.nation.co.ke/business/UK-company-to-survey-Sh161bn-Kakamega-gold/996-4310528-uheggp/index.html

—–

    See also:

Tanzania: Why ‘Mother’ Barrick Gold Needs to Be Rid of ‘Daughter’ Acacia Mining?

London-listed Acacia Mining accused of “sophisticated tax evasion” in Tanzania

Mining firms sue Kenya over permits

By James Kariuki
7th February 2018

IN SUMMARY

– The government said Cortec’s 21-year licence was unprocedurally issued and was against regulations.

– Dr Kiptoo said the cancellations were inspired by the need to safeguard the environment.

Global mining firms are demanding Sh334 billion from the government as compensation for cancelling their licences.

About 10 different cases have been brought to the attention of the International Centre for Settlement of Investments Disputes (ICSID) based in Dubai regarding the revocation of their exploration permits.

Trade Principal Secretary Chris Kiptoo said Kenya is actively involved in the cases and that all agreements with global firms are under review.

“There are ongoing cases at ICSID with claims amounting to Sh334bn. We have seen how vague language in investment treaties can result in massive payouts.

“Kenya has developed a model investment treaty and an investment agreements policy with clear rules and responsibilities,” he said at the 11th Annual Forum of Developing Country Investment Negotiators in Nairobi.

INVEST

One of the disputes involves a Sh200 billion claim by Cortec Kenya and a Sh61.8 billion claim by WalAm Energy Inc.

The others have not been posted on the ICSID’s website.

However, other firms that have lost their licences include Sirmonet Mineral Kenya, Yongtai Mining Company, Balham Trading Company, Ololunga Mining and Industrials as well as AQ Kenya Gold Ltd.

Cortec’s prospecting licence for Niobium and rare earth at Mrima Hills in Kwale was revoked months after it obtained a National Environmental Management Authority permit and announced a Sh44 billion investment in the venture.

CONTRACT BREACH

The government said Cortec’s 21-year licence was unprocedurally issued and was against regulations banning the exploration of minerals in a gazetted forest.

WalAm’s 30-year licence to explore for geothermal suffered a similar fate in 2012 when the Government accused it of breaching contract terms with regard to the construction of geothermal plants.

Dr Kiptoo sought to justify the licence cancellations, saying they were inspired by the need to safeguard the environment, public health, avert taxation disputes and appease communities identified for eviction to pave the way for the mining projects.

SOURCE: https://www.google.com/amp/s/www.nation.co.ke/news/Mining-firms-sue-Kenya-over-permits/1056-4295772-view-asAMP-mvnjrb/index.html

Africa: Mining Legislation in Africa Gone Back to Colonial Days

PRESS RELEASE
5th February 2018

Mining in Africa has reverted to the pre-independence days of colonialism in which legal regimes exist primarily to facilitate profit for mine owners, according to Dr Yao Graham, executive director of Third World Network in Ghana.

Dr Graham was speaking at the Alternative Mining Indaba, a platform for the voices of civil society and people impacted and affected by mining, in Cape Town this morning.

He pointed out that the majority of African countries opted to nationalise mineral resources at independence, a choice which vested ownership of mines in the state on behalf of the people of that country.

“Legal regimes in Africa, however, today exist primarily to facilitate the profits of mining. Laws make corporate welfare possible,” Dr Graham noted.

Decisions about how minerals are exploited should be based on how best the interests of people – those living as well as future generations – were advanced. Any policy framework should have at its heart the notion of sustainability and inter-generational equity.

All elements of community struggle can be regrouped under the concept of collective ownership of mines, Dr Graham said.

He added that it was a huge paradox that communities campaigned against this situation in fragments: “We talk about communities sharing the benefits, managing environmental benefits, workers enjoying better benefits – but these are all fragments. We have lost awareness of most important legal provision – public ownership of mineral regimes on this continent. We have not tried sufficiently to interrogate what this should mean.”

Dr Graham said that it was flawed logic to argue that the best way to share minerals is for multinationals to manage them and then share some of their profits with governments for people.

“Our ownership of minerals should mean that communities make much bigger demands for accountability. Currently, our laws are very defective in accountability, with too much left at the discretion of the authorities,” he added.

Current practice had led to a pattern of unsustainable exploitation, whereas value needed to be added by transforming minerals into other assets, so that less minerals are used, leaving sufficient for future generations.

Earlier in the morning, delegates heard about a community in Botswana that has been left bereft by the closure of a mine in 2015.

Keineetse Kealeboga Maswabi of the Mmadinare community in Selebe Phikwe told the conference that when people in the community were ordered to move in the early 1970s to make way for a mine, they welcomed it and did so without demanding any compensation.

Although services in their new location improved, they were not allocated land to own. Neither did the mine carry out an environmental assessment or establish a sustainability fund.

After the mine closed in 2015, unemployment rose and affected communities found that they had not been given certificates of rights to plough land. This certificate was now required in order for farmers to access government assistance schemes.

“The land board now treats them as squatters,” Maswabi said.

The Alternative Mining Indaba presents an alternative voice – the voice of communities – to that of corporates, governments, investors and financiers who meet yearly during the African Mining Indaba. Through effective advocacy, the AMI aims to enhance transparency and accountability in the governance of natural resources and lead to a continent that extracts minerals sustainably and distributes natural resources revenues equitably.

The objectives of the AMI are to:

– Provide a platform to empower communities affected and impacted by the extractives industries to reclaim their rights through the formulation of alternatives;
– Advocate for transparent, equitable and just extractives practices in the management, governance and distribution of national resources through policy and legislative reform;
– Create meaningful decision-making processes for communities, advocating for just national and regional policies and corporate practices;
– Provide space for engagement for the inter faith communities, governments, CSOs and private sector to share information and experiences; and
– Provide space for the inter faith community to lead and accompany affected and impacted communities.

The AMI is organised by the Economic Justice Network of the Fellowship of Christian Councils in Southern Africa (EJN of FOCCISA) in collaboration with:

Bench Marks Foundation

Christian Council of Mozambique

IANRA (International Alliance on Natural Resources in Africa)

Tax Justice Network Africa

Zimbabwe Environmental Lawyers Association (ZELA)
Publish What You Pay

Norwegian Church Aid
Mozambique Christian Council

Diakonia Zambia

Zimbabwe Council of Churches

Issued by Quo Vadis Communications on behalf of the Alternative Mining Indaba (AMI)

SOURCE: http://allafrica.com/stories/201802070321.html

New Evidence of Africa’s Systematic Looting, From an Increasingly Schizophrenic World Bank

Patrick Bond

A brand new World Bank report, The Changing Wealth of Nations 2018, offers evidence of how much poorer Africa is becoming thanks to rampant minerals, oil and gas extraction. Yet Bank policies and practices remain oriented to enforcing foreign loan repayments and transnational corporate (TNC) profit repatriation, thus maintaining the looting.

Central to its “natural capital accounting,” the Bank uses an “Adjusted Net Savings” (ANS) measure for changes in economic, ecological and educational wealth. This is surely preferable to “Gross National Income” (GNI, a minor variant of Gross Domestic Product), which fails to consider depletion of non-renewable natural resources and pollution (not to mention unpaid women’s and community work).

In its latest world survey (with 1990-2015 data), the Bank concludes that Sub-Saharan Africa loses roughly $100 billion of ANS annually because it is “the only region with periods of negative levels – averaging negative 3 percent of GNI over the past decade – suggesting that its development policies are not yet sufficiently promoting sustainable economic growth…Clearly, natural resource depletion is one of the key drivers of negative ANS in the region.”

The Bank asks, “How does Sub-Saharan Africa compare to other regions? Not favorably.” Contrary to pernicious “Africa Rising” mythology, the ANS decline for Sub-Saharan Africa was worst from 2001-09 and 2013-15.

Other regions of the world scored strongly positive ANS increases, in the 5-25 percent range. Richer, resource-intensive countries such as Australia, Canada and Norway have positive ANS resource outcomes partly because their TNCs return profits to home-based shareholders.

Africa’s smash-and-grab ‘development policies’ aiming to attract Foreign Direct Investment have, even the Bank suggests, now become counter-productive: “Especially for resource-rich countries, the depletion of natural resources is often not compensated for by other investments. The warnings provided by negative ANS in many countries and in the region as a whole should not be ignored.”

Such warnings – including the 2012 Gaborone Declaration by ten African governments – are indeed being mainly ignored, and for a simple reason, the Bank hints: “The [ANS] measure remains very important, especially in resource-rich countries. It helps in advocating for investments toward diversification to promote exports and sectoral growth outside the resource sector.”

Africa desperately needs diversification, but governments of resource-cursed countries are instead excessively influenced by TNCs intent on extraction. Even within the Bank such bias is evident, as the case of Zambia shows.

Zambia’s missing copper

Last year, the Bank appointed Zambia the main pilot country study within the project “Wealth Accounting and Valuation of Ecosystem Services” (WAVES). Zambian forests, wetlands, farmland and water resources were considered the “priority accounts.” Conspicuously missing was copper, the main component of Zambia’s natural wealth.

Was copper neglected in WAVES because such accounting would show a substantial net loss? One Bank estimate of copper’s annual contribution to Zambia’s declining mineral wealth a decade ago put it at a huge 19.8 percent of GNI. Were such data widely discussed, it might compel a rethink in Zambia’s desperate privatisation of mines and export of unprocessed ore.

Naturally most World Bank staff work not in Zambians’ interests, but on behalf of other international banks and TNCs. This compels them to squeeze Zambia’s scarce foreign exchange: first, so TNCs can take profits home, and second, so Lusaka repays loans no matter how unaffordable and no matter how corrupt the borrowing government. Repayment is now especially difficult given that the kwacha declined from a level around 1 to the US$ in the 1990s to around 5 to the US$ from 2003-15, to the 9-12/US$ range since.

From 2002-08, the Zambian government led by Levy Mwanamasa (1948-2008) came under severe pressure from the World Bank to sell the most valuable state assets to repay older loans, including those taken out by his corrupt predecessor, Frederick Chiluba (1943-2011). That debt should have been repudiated and cancelled.

Even then, when selling Africa’s largest copper mine at Konkola, Mwanamasa should have ensured at least $400 million went into Zambia’s treasury. But the buyer, Vedanta chief executive Anil Agarwal, laughed wickedly when bragging to a 2014 investment conference in Bangalore, India, that he tricked Mwanawasa into accepting only $25 million. “It’s been nine years and since then every year it is giving us a minimum of $500 million to $1 billion.” (Agarwal is now in the process of buying Anglo American’s South African mining assets, having purchased 20 percent of the firm in 2016-17.)

Against the looting of Africa: top-down or bottom-up?

Zambia is not alone. The Bank reports that from 1990-2015 many African countries suffered massive ANS shrinkage (a process termed ‘dissaving’ as a polite substitute for ‘looting’), including Angola (68 percent), the Republic of the Congo (49 percent) and Equatorial Guinea (39 percent). As commodity prices peaked in the 2007-14 super-cycle period, resource depletion was the major factor for Africa’s wealth shrinkage.

What can be done? There are really only two ways to address TNC capture of African wealth: bottom-up through direct action blocking extraction, or top-down through reforms.

The futility of the latter is exemplified by the African Union’s 2009 Alternative Mining Vision (AMV). It proclaims (without any reference to natural resource depletion capital accounting), “arguably the most important vehicle for building local capital are the foreign resource investors – TNCs – who have the requisite capital, skills and expertise”

South African activist Chris Rutledge opposed this neoliberal logic last year in an ActionAid report, The AMV: Are we repackaging a colonial paradigm?: “By ramping up models of maximum extraction, the AMV once again stands in direct opposition to our own priorities to ensure resilient livelihoods and securing climate justice. It is downright opposed to any type of Free Prior and Informed Consent. And it does not address the structural causes of structural violence experienced by women, girls and affected communities.”

The first strategy – community-based opposition – could be far more effective. According to a pamphlet prepared by Johannesburg faith-based mining watchdog Bench Marks Foundation for the civil society Alternative Mining Indaba in Cape Town this week, “Intractable conflicts of interest prevail with ongoing interruptions to mining operations. Resistance to mining operations is steadily on the increase along with the associated conflict.”

The Alternative Indaba’s challenge is to embrace this resistance, not retreat into reformist NGO silos – and not continue to ignore mining’s adverse impact on energy security, climate and resource depletion as it often has.

Indeed, three years ago, Anglo American CEO Mark Cutifani conceded that due to community protests, “There’s something like $25 billion worth of projects tied up or stopped,” a stunning feat given that all new mines across the world were valued that year at $80 billion. (A map of these can be found at the Environmental Justice Atlas, http://ejatlas.org.)

Meanwhile, the World Bank’s lending staffers (distinct from the Changing Wealth of Nations researchers) are still subject to protests over mining here. Women living in the Marikana slums, organised as Sikhala Sonke, remain disgusted by the $150 million financing commitment made to Lonmin, which from 2007-12 the Bank bizarrely considered its ‘best case’ for community investment – until the police massacre of 34 workers there during a wildcat strike. (Bank president Jim Yong Kim even visited Johannesburg two weeks after that, but didn’t dare mention much less visit his institution’s ‘best case’ mining stake.)

The Bank’s other notorious South Africa operations included generous credits to the apartheid regime, relentless promotion of neoliberal ideology after 1990, a corrupt $3.75 billion Eskom loan in 2010 (the largest-ever Bank project loan, which still funds the most polluting coal-fired power plant under construction anywhere in the world), and ongoing lead-shareholder investments in the CPS-Net1 rip-offs of South Africa’s 11 million poorest citizens who receive social grants.

To top it all off, in spite of the embarrassing revelations about TNC exploitation unmistakeable in The Changing Wealth of Nations 2018, the Bank is a financial sponsor of this week’s African Mining Indaba at the Cape Town convention centre. Each year, it’s the place to break bread and sip fine Stellenbosch wines (though perhaps not water in this climate-catastrophic city) with the world’s most aggressive mining bosses and allied African political elites, conferring jovially about how to amplify the looting.

SOURCE: https://www.counterpunch.org/2018/02/05/new-evidence-of-africas-systematic-looting-from-an-increasingly-schizophrenic-world-bank/

Tanzania’s Mining Firms Have Three Months to Comply With Law

By Beatrice Materu
23rd January 2018

In summary:

– New guidelines pushed for the mandatory listing of mining companies on the DSE by August last year as part of measures aimed at increasing transparency and sharing out wealth from the country’s natural resources.

– The rules give the government the right to oversee the implementation of these regulations, evaluate and review contracts as see fit.

– President John Magufuli has previously complained that the country is not benefiting as it should from its resources.

Tanzania is set to restructure its troubled mining sector after the government gave mining companies three months to comply with new guidelines, which give local mining firms and financial institutions preference.

Part of the regulations state:

“A contractor, subcontractor, licensee or other allied entity shall before the commencement of mining activities submit a plan to the Commission specifying the role and responsibilities of the indigenous Tanzanian company; the equity participation of the indigenous Tanzanian company; and the strategy for the transfer of technology and know-how to the indigenous Tanzanian company,”

“Mining companies will have to open and operate bank accounts in a “100 per cent” Tanzanian-owned banks.

The rules give the government the right to oversee the implementation of these regulations, evaluate and review contracts as see fit.

President John Magufuli has previously complained that the country is not benefiting as it should from its resources.

New laws

Mid last year, Tanzania’s parliament pushed for new laws on its extractives industry: The Natural Wealth and Resources Contracts (Review and Re-Negotiation of Unconscionable Terms) Bill, 2017; the Natural Wealth and Resources (Permanent Sovereignty) Bill, 2017; and, the Written Laws (Miscellaneous Amendments) Act, 2017.

The new guidelines pushed for the mandatory listing of mining companies on the Dar es Salaam Stock Exchange by August last year as part of measures aimed at increasing transparency and sharing out wealth from the country’s natural resources.

President Magufuli signed the Mining Act in July last year and it requires the government to own at least a 16 per cent stake in mining activities. The troubled mining sector generates about 3.5 per cent of the country’s GDP.

The government accused gold mining company Acacia, of tax evasion and under-declaring amount and types of minerals exported. The government banned it from exporting gold/copper concentrates, which account for over 50 per cent of the company’s operations.

Other major foreign-owned mining companies that will be affected by the new legal regulations on local content include the South African AngloGold Ashanti and British mining company Petra Diamonds.

SOURCE: http://www.theeastafrican.co.ke/business/Mining-firms-have-three-months-to-comply-with-law-/2560-4274926-dara16/index.html