The real bad guys: the confused world of mining

A Chinese ship waits to carry raw nickel out of Weda Bay

A Chinese ship waits to carry raw nickel out of Weda Bay

Drifting out of the world of HIV, I’ve been able to get away from the knee-jerk demonisation of Big Pharma (often by people who are only too happy to extend their lives by taking their Truvada as long as someone else pays for it). But I’ve re-discovered another Public Enemy Number 1: Big Mining. Just to be clear, I’m under no illusion that Rio Tinto is all sweetness and light and contributing to human welfare, any more than Pfizer is. Both are out to rake in as much cash as they can for their shareholders by doing what they do best; in the case of Rio Tinto, sucking riches out of the earth and selling them to people who turn them into things that we all want and use daily. No amount of support for local communities, replanting of mined areas, investment in the workforce that we hear about from the Corporate Social Responsibility department can disguise the naked demands of the bottom line.

But that doesn’t mean that the corporate social responsibility stuff doesn’t exist. It may exist only to brush up the public image of Big Bad Mining. It may exist out of enlightened self-interest; corporations are increasingly aware that ignoring the needs of the local population (or even their demands, which is not always the same thing) can undermine their whole enterprise. We’ve seen a particularly vicious example in Indonesia this week; a gold mining licence has been retracted, but only after rioting locals burned the local Bupati’s office to the ground. Australian Arc Exploration, which began exploratory mining in Sumbawa in November, is not exactly at the forefront of Corporate Social Responsibility, judging from its website. But the very fact that corporate social responsibility exists among the larger corporates is something to celebrate as a step forward from the bad old days when mining companies working hand in hand with government officials didn’t even have to pretend to care for the environment, much less for humans.

I find it deeply ironic, however, that the companies that do the most to try and accommodate local needs and to mitigate the inevitable damage done by opening up the earth and digging out its contents are the very ones most often and most volubly targeted by the professional anti-mining protest groups (in Indonesia led by the respected environmental NGO Walhi). It seems that it is easiest to go after the large international corporations that do actually have a smattering of conscience about the consequences of mining, not least because those are the ones that are also making a long-term investment that is by definition tied to a specific location and community. The fly-by-night companies (these days often Chinese) referred to in Indonesia as “Scratch and Runs” are considered so beyond the pale that they get off virtually scott free.

I saw this recently in central Halmahera, a mineral-rich but little developed area of the eastern province of Maluku. The French firm Eramet, in partnership with Japan’s Mitsubishi, has a license to develop a vast nickel mine in Weda Bay. I really mean vast; the permit covers over 72,000 hectares of land, most of it forest. In compliance with the terms of their license, and also because they have asked for financial guarantees from the World Bank family MIGA facility, Weda Bay Nickel has commissioned passels of reports on environmental, social, health, cultural and other impacts, and has committed to measures to minimise the negative impacts in most of these areas. This has not stopped the mining protest groups from filing complaints and staging demos, one of which I witnessed while in the provincial capital, Ternate. The spontaneous demo by students and concerned citizens managed to find the cash to hire a large truck with a booming sound system, as well as to print up banners and posters. I have no doubt that the presence of these groups will keep Weda Bay Nickel on its toes, will make them pay more attention to the environment, will maybe even increase their investment in education and health facilities in the local communities. But these same protest groups have said next to nothing about Weda Bay Nickel’s neighbours, the Chinese owned Tekindo Energi. Unlike Weda Bay Nickel, which is building a port and investing in a processing plant which will create thousands of jobs locally, Tekindo is piling raw nickel on to boats and spiriting it off to China as fast as it possibly can, before a moratorium on exports of raw nickel comes into effect in 2014. Meanwhile, as far as anyone working locally can tell, it is doing virtually nothing to minimise the damage it is doing to the environment. Six villages downstream from the Tekindo site say they can no longer draw drinking water from the river because it is now yellow with sediment, the run-off from the mining process.

Perhaps NGOs ignore the likes of Tekindo because they will be gone soon, where as Weda Bay Nickel is here to stay. But the damage Tekindo is doing may well be permanent. Weda Bay has some of the finest, if least known, diving in Indonesia, perhaps anywhere in the world. One professional underwater photographer commented recently that five out of the 10 best dives of his life were during his four days in Weda Bay. The only dive resort for miles around is in regular contact with Weda Bay Nickel engineers about their plans for waste disposal, and has no concerns that the bay will be affected. But if nothing is done soon about Tekindo’s run-off, the sediment will settle on the bay’s glorious corals and kill them. That would also kill the prospect for eco-tourism, an obvious alternative to mining as a source of long-term employment for people in Halmahera. When I asked people locally why they weren’t protesting about Tekindo instead of (or as well as) Weda Bay Nickel, they got very shruggy. “Chinese companies, they are all shits, what’s the point?” It seems that no-one is tackling Tekindo precisely because they are so irresponsible.

The more extreme activists who are trying to oust Weda Bay Nickel and similar enterprises owned by large Western corporations (which, for all their faults, have fairly rigorous policies on environmental regeneration and community protection) should be careful what they wish for. The most likely consequence is not no mining, but more mining by small, completely irresponsible companies prepared to pay large bribes to local officials for licences over which there is no oversight.


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4 Comments on "The real bad guys: the confused world of mining"

  1. I completely agree with you. However worth to mention too is the vast primary forest with its endemic birds and reptiles that needs to be protected. A big difference between Weda Bay Nickel and the others is that the smaller companies have their permits from the local authorities instead of the central government. One of the huge negative side effects of the “otonomi dearah”.

  2. I suppose the same strategy is done with Apple – target the larger brands – and hope the standards they set rub off a little on others.

  3. Nick Copeland | March 22, 2012 at 12:47 am | Reply

    Elizabeth, I commend you for your objectivity. I was involved in an independent strategic & stakeholder study back in 08 and know the site & project well. I came away with the feeling that they really are trying to do the right thing in a yes, hugely fragile environment. The Chinese will have no such qualms…and you can bet your house that the environmental problems they cause will one day be blamed or at least held up for negative reflection back on Eramet!…

  4. Let’s not forget that the Indonesian Government has a shareholding in this project through its ownership of Pt Aneka Tambang. So it’s not just those evil exploitive Westerners.

    Is there general opposition to this mine by the local population, or are these protest and “NGO” groups funded by businessmen/groups with other interests? You would be naive to think it was purely altruism behind all the opposition.

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