Engineering & Mining Journal

SEP 2014

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Extractive sector companies are also straying into "customary tenure" sys- tems—unofficial borders pre-dating those of modern nation states. Traversing a developing world long at the mercy of colonial powers, and the crumbling in- stitutions and corrupt dictatorships they left behind, these can pose a far greater nightmare than many commodity and currency shifts. In extreme environments in South- east Asia where investors from China converge, farmers are left with nothing, and word can spread fast. "The legal framework is good, but enforcement is the issue," said CDE researcher Schoenweger. "Most of the time, no compensation is provided to individu- als;" Akhom Tuonalom, a vice minister of the nation's Ministry of Natural Re- sources, conceded: "Weakness is in national land planning and enforcement of investment regulations." Free Prior and Informed Consent Guatemala's indigenous groups have been acutely sensitive to this after mining concessions soared 1,000% since 1997 peace accords capped 36 years of Central America's longest, most genocidal civil conflict. These include "institutional" and "relational" types of trust "laden with emotion," when engag- ing with outsiders regarding large mining projects, noted sociological and legal experts like Michael Dougherty of Illinois State University and Tricia Olsen of the University of Denver's Daniels College of Business. Both are "instrumental in understanding how individuals in agrari- an host communities form preferences about mining," the two wrote in a recent white paper. Moreover, "self-efficacy makes the difference," in stakeholder relations, when individuals "believe in their own capacity they tend to grapple, and those who grapple are more likely to critique mining; alternately, those who lack self- efficacy tend to support and trust min- ing," Dougherty and Olsen added. Essential is Free Prior and Informed Consent (FPIC), however, wherein resi- dents agree to a project after initial consultation. But it's a crisis in Guatemala, wrote Silvel Elias, a director at the Agronomy School of Guatemala's University of San Carlos, this year in Americas Quarterly . FPIC "requires trust and respect among the government, com- panies, social organizations and indige- nous groups," Elias said, "conditions that do not currently exist in Guatemala." Having withered under their own cocaine-fueled, Marxist-oriented drug civil unrest, Colombian rural and indige- nous communities are similarly marginal- ized in another of Latin America's most mineralized jurisdictions. In Q1 2014, for instance, Claudia Jimenez, a Mining Ministry official, told El Colombiano that some $7.3 billion in investment had been stalled over FPIC issues concerning both environmental licenses amid a dip in international commodity prices. Brazil to the south also hosts FPIC issues—in particular, Maranhao, the poorest state in Latin America's biggest country—where rail infrastructure tying Vale S.A.'s Carajas iron ore mine with Sao Marcos bay is being expanded across 23 municipalities. "We have money in our pockets, but no water to drink, the rivers are polluted," George Pereira, secretary of the Community Association of Itaqui- Bacanga, near the port, told the Inter Press Service news agency. Currently, the Carajas project, one of the biggest of its kind, already ex- ports 110 million tons of ore daily via a 556-mile railway to the Ponta da Madeira port. Vale, the No. 3 Rio de Janeiro- based miner, "does good work, but in iso- lation," Pereira said, "without trans- formative programs to develop the en- tire area." Burma, highly anticipated as a miner- al-rich nation opening up in 2011 after decades of brutal military rule, has seen violence of late—even after Nobel Peace Prize winner and opposition leader Aung San Suu Kyi went to calm protestors out- side a Chinese copper mine. Despite sharing the remote villagers' ethnicity, they chased her off in fury over losing their land (prior to her visit, Suu Kyi's parliamentary inquiry revealed security forces deployed white phosphorous, a gruesome chemical agent banned by the Geneva Conventions as a war weapon, against the same protestors). For better or worse, the frailty of nations like Burma also leaves room for outside NGO intervention preceding a company's presence. U.S.-based Earth- works, for instance, has already teamed up with Myaung Po villagers in court over pollution charges by a Thai miner; Indonesia's state-owned PT Timah, one of the world's biggest tin miners, mean- while, has also announced plans to begin 2015 operations nearby. Game Changing Other things, while less dramatic at the outset, can add up over time, such as the technical orientation of staff, according to Bruce Harvey, a consultant and former global practice leader for communities and social performance at Rio Tinto. "To the outside world, the business and the staff who work within it, continue to be seen as insular, introverted, uncaring technocrats who appear highly uncom- fortable at the very thought of rubbing shoulders with community members," Harvey wrote in the journal Extractive Industries and Society in Q4 2013. "In fact, all the operational, safety, security and other systems at an extractive opera- tion are perfect for maintaining quaran- tine and these tend to become inadver- tently reinforced over time." John Aston, owner of Aston Eco Management, a consulting firm with extensive experience in eastern Europe, knows the mindset. "The sad reality is the companies only take it seriously when the activists wake up," he said. "The industry is just fed up with the activists." They still play a critical role. "It's amazing how the tone can change when a company has fear of an opposition," Aston added. In Changing the Game: Communi- cations and Sustainability in the Mining Industry , a 2013 International Council of Mining and Minerals (ICMM) study, interviews with 25 executives of multi- national miners showed a major shift in engagement is under way—if not fast enough. "This is moving from a short-term tac- tical role to a long-term strategic one," said the report, co-authored by the International Finance Corp. (IFC) "Every company is grappling with the need to evolve from ad-hoc and reactive commu- nications to a more proactive and struc- tured model, able to engage in dialogues with stakeholders and anticipate issues before they appear." But misinterpretations persist all around, noted people like Yadaira Orsini of the U.K. NGO International Alert. "One is that communities only want money—that's very simplistic," she said at 2014's Mining Indaba in Cape Town. "In some cases, we see that, but you're 58 E&MJ • SEPTEMBER 2014 www.e-mj.com C S R & S U S TA I N A B I L I T Y

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