In­ter­na­tional le­gal prece­dent is turn­ing up heat on large min­ers

The Star Early Edition - - NEWS - MARK OLALDE

SYM­BOLIC at best, the tiny group of pro­test­ers stood out­side An­gloGold Ashanti’s head­quar­ters in New­town, Jo­han­nes­burg, in Septem­ber. Se­cure be­hind a high gate, com­pany em­ploy­ees could nei­ther see nor hear the pro­test­ers who had trav­elled from Colom­bia.

A coali­tion of farm­ers, ac­tivists and sci­en­tists, they were lead­ing a groundswell of op­po­si­tion against a gold mine pro­posed by An­gloGold in Colom­bia. Sev­eral peo­ple had been killed since protest­ing be­gan, but the com­pany claimed the deaths had noth­ing to do with their ac­tivism nor with An­gloGold.

The com­mu­nity re­cently voted against al­low­ing min­ing in the area, an eco­log­i­cally-sen­si­tive moun­tain for­est, and An­gloGold de­cided to “pause much of the cur­rent field­work”, said com­pany spokesper­son Chris Nthite.

“(Min­ing) threat­ens our sys­tems of wa­ter and food pro­duc­tion. We don’t think this is the right choice for our land. We pre­fer to live with wa­ter and agri­cul­ture, not min­ing,” said ac­tivist Xi­mena Gon­za­lez.

While An­gloGold is no longer part of the An­glo Amer­i­can (An­glo) group, it was born out of the South African min­ing em­pire, which now has off­shoots around the world. At its cen­ten­nial mark of op­er­a­tions, An­glo holds a mixed legacy, hav­ing ben­e­fited from un­fair labour prac­tices while act­ing, at times, as a pro­gres­sive in­dus­try leader.

Now, in the face of shift­ing min­er­als needs and or­gan­ised op­po­si­tion, the legacy of An­glo is in many ways tied more closely to closed mines than those still op­er­at­ing.

An­glo was founded by Ernest Op­pen­heimer in 1917, and in 1929 he be­came the chair­man of De Beers, by then con­trolled by An­glo. He forged on, build­ing one of the world’s dom­i­nant min­ing houses.

In 1946, the Geduld No. 1 bore­hole near Welkom struck sig­nif­i­cant gold. While min­ing had al­ready been un­der way, this set off a gold rush in the Free State gold­fields.

Two years later, D Ja­cob­s­son, at the time The Star’s min­ing ed­i­tor, de­scribed “Jo­han­nes­burg’s orgy of spec­u­la­tion” in his book Maize Turns to Gold. Even at the time, the rush added about £30 mil­lion to the JSE nearly overnight.

In a ques­tion that could not have pre­dicted the cur­rent aban­don­ment of South Africa’s mines, Ja­cob­s­son asked: “Will the Free State gold­field set up any chal­lenge to the pres­tige of the Blyvooruitzicht mine of the Far West Rand, the world’s rich­est prop­erty in large scale pro­duc­tion?”

Blyvooruitzicht Gold Mine, which be­gan op­er­a­tions in 1937, was aban­doned in 2012 by DRDGOLD and Vil­lage Main Reef af­ter a sale soured. It is now a poster child for the prob­lems en­grained in a con­tract­ing gold in­dus­try that failed to prop­erly plan for en­vi­ron­men­tal and so­cial re­ha­bil­i­ta­tion.

Of course, the spectacular rise of the gold in­dus­try in South Africa came on the backs of Africans trapped in a sys­tem of mi­grant labour that up­held apartheid. While An­glo was pro­gres­sive in op­pos­ing some apartheid prac­tices and im­ple­ment­ing pro­grammes such as em­ployee HIV test­ing, it greatly ben­e­fited from cheap labour and state sub­si­dies the sys­tem pro­vided.

Harry Op­pen­heimer gave a speech in New York in 1984, for ex­am­ple, ar­gu­ing for all races to re­ceive po­lit­i­cal rep­re­sen­ta­tion. At the same time, he ar­gued against eco­nomic sanc­tions, said “home­lands” were too en­trenched to aban­don and called those liv­ing in po­lit­i­cal ex­ile “the worst pos­si­ble guides in such mat­ters”.

Welkom, with An­glo as its most im­por­tant player, was de­signed to be a South African utopia in the midst of pre-apartheid racial ten­sions. Ev­ery­thing from health (the town came with a state-of-theart hos­pi­tal) to traf­fic pat­terns (traf­fic cir­cles re­placed robots at ma­jor in­ter­sec­tions) was planned to make life easy.

Kobus de Jager is a min­ing re­searcher who spent decades work­ing in the Free State gold­field and was an ex­ec­u­tive at Free­gold, one of An­glo’s ma­jor sub­sidiaries that con­trolled many of the area’s mines. He said An­glo did its best to treat all its em­ploy­ees well, but that there was far too lit­tle plan­ning for how the hun­dreds of thou­sands of peo­ple di­rectly and in­di­rectly de­pen­dent on min­ing would sur­vive when An­glo left.

“(Plan­ning) was left too late. By then, you didn’t cre­ate an al­ter­na­tive in­dus­try within Welkom for it to ac­tu­ally sur­vive in the long term. What hap­pened is you cre­ated poverty traps,” he said.

Pule Le­doka Gu­bico, an ac­tivist associated with the Bench Marks Foun­da­tion, sur­veyed the mas­sive piles of mine waste run­ning along the side of the road and the aban­doned mine shaft ris­ing from the rub­ble of a par­tially de­mol­ished gold mine. He had spent the day test­ing wa­ter qual­ity around the Welkom area, and this par­tic­u­lar bar­ren land­scape caught his eye.

“This is what’s left by the min­ing com­pa­nies. They have taken ev­ery­thing else,” he said.

This, said De Jager, is in part be­cause en­vi­ron­men­tal con­scious­ness did not per­me­ate the An­glo group un­til the 1990s. He claimed that the mere de­mo­li­tion of a site was ac­cepted as en­vi­ron­men­tal re­ha­bil­i­ta­tion for many years.

Re­search pub­lished in 1903 had al­ready iden­ti­fied acid mine drainage and the in­dus­try’s un­der­stand­ing that its pump­ing of un­der­ground wa­ter could lead to the prob­lem. Be­cause of this knowl­edge, some ac­tivists claim An­glo could face charges of fraud in­ter­na­tion­ally for his­toric en­vi­ron­men­tal dam­age caused by its sub­sidiaries.

An­glo de­nied that any grounds ex­ist for such a charge.

“An­glo Amer­i­can was quite clever to pull out of th­ese (mines) be­cause the legacy and la­tency of oc­cu­pa­tion hy­giene is­sues such as dust was start­ing to sim­mer at the time,” De Jager said, al­lud­ing to dis­eases such as sil­i­co­sis. “In­stead of pre­serv­ing the en­vi­ron­ment for fu­ture gen­er­a­tions, they ac­tu­ally al­lowed it to be stuffed up.”

As hap­pened with gold, South African coal is now be­com­ing a less at­trac­tive place to in­vest. In­ter­na­tional mar­kets are lost to the re­new­able elec­tric­ity gen­er­a­tion, coal prices have dropped and Eskom is push­ing poli­cies that ma­jor min­ing houses find dif­fi­cult to meet.

In May, 2015, BHP Bil­li­ton ce­mented its exit from South African coal when it de­merged with South32.

An­glo fol­lowed suit and an­nounced in April that it would sell its Eskom-tied coal mines to Ser­iti Re­sources Hold­ings. The sale in­cludes three op­er­a­tional and four closed mines.

An­glo rep­re­sen­ta­tives say the com­pany trans­fers

Min­ing threat­ens our wa­ter and food pro­duc­tion

its fi­nan­cial pro­vi­sions for re­ha­bil­i­ta­tion to buy­ers in sales of mines, even though this is not legally man­dated.

“We would never know­ingly dis­pose of any of our rights to an en­tity that was ei­ther un­will­ing or un­able to as­sume re­spon­si­bil­ity for any of the obli­ga­tions at­tached to those min­ing rights,” said An­glo spokesper­son Ann Farn­dell.

The Cen­tre for En­vi­ron­men­tal Rights sent An­glo a let­ter in April ask­ing for trans­parency and pub­lic par­tic­i­pa­tion in the sell­ing of th­ese mines to en­sure that en­vi­ron­men­tal obli­ga­tions are met.

In a press re­lease on the mat­ter, the NGO ex­plained that the let­ter was a re­sponse to “the grow­ing trend in South Africa where large min­ing com­pa­nies, of­ten with ma­jor en­vi­ron­men­tal li­a­bil­i­ties, sell their mines to smaller min­ing com­pa­nies.

“Th­ese smaller com­pa­nies are of­ten ei­ther un­will­ing or un­able to ful­fil the re­ha­bil­i­ta­tion obli­ga­tions im­posed by the min­ing rights for th­ese op­er­a­tions. When en­vi­ron­men­tal li­a­bil­i­ties are aban­doned, they be­come the re­spon­si­bil­ity of the state, and there­fore the re­spon­si­bil­ity of South African tax­pay­ers.”

Mines in South Africa no­to­ri­ously pass hands from larger com­pa­nies down a chain of sales un­til scav­enger com­pa­nies – small min­ers with in­suf­fi­cient funds for re­ha­bil­i­ta­tion and no long-term plans – sim­ply aban­don them. As a ma­jor player in the in­dus­try, An­glo has been re­spon­si­ble for the open­ing of many mines, but not the clos­ing.

Richard Spoor is a hu­man rights at­tor­ney in­volved in the sil­i­co­sis class ac­tion law­suit, which in­volves An­glo and nu­mer­ous other min­ing houses. He said that as some large gold min­ers like An­glo be­gan leav­ing the in­dus­try, they would sell their as­sets and wind up sub­sidiaries.

“There’s no­body left to sue. This is stan­dard prac­tice in the gold min­ing in­dus­try,” he ex­plained.

Dun­can Innes, a for­mer so­ci­ol­ogy pro­fes­sor at the Univer­sity of the Wit­wa­ter­srand, wrote his sem­i­nal book on An­glo Amer­i­can, ti­tled An­glo Amer­i­can and the Rise of Mod­ern South Africa. In it, he lays out a com­plex web of 656 com­pa­nies con­nected in the An­glo Amer­i­can Group as of 1976.

Th­ese com­pa­nies were ac­tive in min­ing in 22 coun­tries span­ning the globe from South African gold to Zam­bian cop­per, from oil in Europe’s North Sea to prospect­ing in Canada.

Ex­perts ar­gue that the Op­pen­heimer fam­ily and An­glo’s lead­er­ship were able to main­tain a tight grip over the em­pire while us­ing mi­nor­ity share­hold­ing as a shield against li­a­bil­ity.

Spoor ex­plained that an in­ter­na­tional le­gal prece­dent called “par­ent com­pany li­a­bil­ity” is begin­ning to put the heat on large min­ers that op­er­ated be­fore cur­rent best prac­tices were adopted.

“If the par­ent com­pany has the ex­per­tise, is en­gaged in the same busi­ness as the sub­sidiary and knows what’s hap­pen­ing at the sub­sidiary, and it gives it ad­vice that the sub­sidiary fol­lows, then the par­ent com­pany has a duty of care,” he said.

An­glo was quite clever to pull out of th­ese mines

Mark Olalde’s work is fi­nan­cially sup­ported by the Fund for In­ves­tiga­tive Jour­nal­ism, the Pulitzer Cen­tre on Cri­sis Re­port­ing and the Fund for En­vi­ron­men­tal Jour­nal­ism.

Jorge Ru­biano, a Colom­bian sci­en­tist and anti-min­ing ac­tivist, protests out­side An­gloGold Ashanti’s Jo­han­nes­burg head­quar­ters.

PLAN­NING: David van Wyk of the Bench Marks Foun­da­tion meets Colom­bian anti-min­ing ac­tivists in Au­gust.

PRIORITIES: Colom­bian ac­tivist Xi­mena Gon­za­lez protests out­side An­gloGold Ashanti’s head­quar­ters in Au­gust.

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