Brazil files homicide charges against Vale ex-CEO, 15 others in deadly 2019 dam collapse

Rescue operations underway in the wake of Vale’s Brumadinho dam collapse

Brazil prosecutions a stark contrast to the lack of corporate culpability in Papua New Guinea for a series of ‘world class’ environmental disasters and thousands of preventable deaths from river pollution…

Ana Paula Blower and Siobhán O’Grady | Washington Post | January 21, 2020

Prosecutors on Tuesday filed homicide charges against Fabio Schvartsman, the former CEO of the Brazilian mining conglomerate Vale, and 15 other people in the deadly dam collapse last year that killed at least 249 people.

The Minas Gerais state prosecutor’s office said it was bringing homicide and environmental charges against 11 people who worked for Vale and five who worked for the German safety-certification company TUV SUD. The companies will also face environmental charges.

The prosecutor’s office said the charges followed a nearly year-long investigation that concluded the dam posed a critical safety risk since at least 2017, and the situation worsened in 2018. In a statement, prosecutors accused Vale of hiding information related to the safety of the dams “from the government and society, including investors and shareholders of the company.”

They said investigators determined the alleged crimes were carried out in a way “that made it impossible or difficult for the victims to defend themselves — since the dam burst occurred abruptly and violently.”

In a statement, Vale said Tuesday that it would cooperate fully with authorities but “believes the accusations of fraud are perplexing.”

“It is important to note that other authorities are investigating the case and, at this point, it is premature to claim there was conscious assumption of risk to cause a deliberate breach of the dam,” the statement said.

Schvartsman’s lawyers said the charges against him were “hasty and unfair,” and should not have been determined before federal police finish their investigation.

Attorneys Pierpaolo Cruz Bottini, Mauricio Campos and Paulo Freitas said in a statement that Schvartsman took repeated measures to ensure dam safety at Vale, and opened an immediate investigation when the dam burst last year. They said authorities ignored documents submitted for the investigation that show the problems at the dam were not relayed to Schvartsman’s office.

“Those responsible must be held responsible for their actions,” the lawyers said. “But the attempt to punish those who, since the first hour, fulfilled their duty and stood by the authorities to investigate what happened and repair the damage, is unjust and regrettable.”

Vale and TUV SUD have faced scrutiny since the 280-foot tailings dam in the Minas Gerais municipality of Brumadinho collapsed last January, unleashing nearly 2 million cubic meters of toxic waste onto the mine’s offices and a nearby community. Torrents of mud swept away hundreds of people; some are still missing.

Schvartsman has been on leave since March. “Even totally assured of my righteous ways and having fulfilled my duty,” he wrote to company directors at the time, “I request the board to accept my temporary leave in the benefit of the company’s continued operations.”

TUV SUD said Tuesday it is “deeply affected” by the disaster, and “is still very much interested in clarifying the facts of the dam breach and therefore continues to offer its cooperation to the responsible authorities and institutions in Brazil and Germany in the context of the ongoing investigations.”

The company declined to offer further details Tuesday, citing “ongoing legal and official proceedings.”

Waste from the collapse on Jan. 25, 2019, blanketed miles of vegetation. Firefighters uncovered a bus carrying employees in the wreckage. All on board were dead.

Iara Murta, 58, fled her home with her two sisters. Speaking to The Washington Post in the aftermath, she said saw bodies and livestock stuck in the river of mud and mining runoff.

“It’s like watching the worst horror film,” she said.

In July, a Brazilian judge ordered Vale to cover all costs related to the dam’s collapse. Vale, based in Rio de Janeiro, said it would pay families more than $100 million.

Last year’s dam collapse shed light on the dangers of tailings dams, prompting reviews of other locations in Brazil where dams could be at risk for similar types of collapse.

A different Vale-operated dam burst in Minas Gerais in 2015, killing 19 people and displacing hundreds. After last year’s collapse, former environmental minister Marina Silva tweeted that “History is repeating itself,” and that “the government and the mining companies have learned nothing.”

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PNG New Ireland Deputy Governor Tells Social Media Mining Critics : Get Smart or Get Screwed

Pacific Mining Watch

 Papua New Guinea’s Deputy Governor of New Ireland, Sammy Missen, said today that it is actually amusing to see all the talk on social media about the failure of politicians to take action to make the mining sector work better, to the benefit of the people of the country.

Mr. Missen said “I find it amusing, because all these people are just missing the point. If they are so concerned about making changes in the Mining Act, then they should start supporting those who really want to make changes rather than just complaining all the time.”

The Deputy Governor said that there is one politician in the country who is serious about making the Mining Sector work to the advantage of the people. “That person is Sir Julius Chan. Sir Julius has been saying for more than ten years that the Mining Act should be changed. He has been saying that the current Mining Act takes huge wealth from the landowners and only gives them a few toea in return. Sir J says that the landowners should get automatic ownership in any mine. Landowners should never have to buy shares in a mine – they should get shares free, automatically. The gold and the copper and the nickel is in OUR ground.”

And, Mr. Missen said, “Sir J says that any company that wants to come in an operate a mine should be able to do so, but they will just be contractors. The owners of the mine will be the owners of the land – the State, the Province or the landowners, whoever owns the land where the mine is operating. And the benefits to the landowners will go up by five times from what they are now. Em tasol.”

Mr. Missen said that Sir Julius has been trying to make these changes in the Mining Act for years. “Almost three years ago Sir J introduced a Private Member’s Bill to Parliament to Revise the Mining Act. But the O’Neill Government did not act. And when the Marape Government came to power one of the first things it did was to invite a New Ireland Team to sit down with him and explain how the Mining Act should be revised. The Prime Minister said he would support those changes, but so far nothing has been done.”

Mr. Missen said criticism of the Mining Minister, the Hon. Johnson Tuke, is misplaced. “Minister Tuke fully supports the changes Sir Julius has proposed,” he said. “He supports giving ownership of the mines to the people who own the land, increasing royalties for the people and increasing all benefits coming from mining. But he can do nothing without the support of the Prime Minister.”

“And that is what people should understand,” said the Deputy Governor. “They should stop criticising everyone, and realise who their friends are. They should realise that they have an ally in Sir Julius. They have an ally in Minister Tuke. What the people need to do is to Get Smart. The need to telephone their MPs email their MPs, go on social media and tell their MPs they demand that they support the changes Sir Julius wants to make. The people need to make some NOISE! They need to demand a Revised Mining Act that will make the people rich from the wealth that is coming from THEIR ground.”

“And if their MPs do not listen to them,” Mr. Missen said, “if their MPs do not support giving the people a much larger share of the benefits, then the people need to make it very clear that those MPs will not get their votes in the next election. That is the only thing politicians understand. The People must tell their MPs one thing – if you refuse to support changes to the Mining Law that will benefit us, then you will no longer represent us. Em tasol!”

“And that,” Mr. Missen concluded, “is what people should be doing. They need to Get Smart. They need to realise who their friends are, and support them. If people just continue to moan and groan and refuse to work together, all our mines will end up just big holes in the ground, and all the wealth from them will be sitting in foreign bank accounts!”

In closing, the Deputy Governor said, “I can tell you one thing for sure. If we don’t Get Smart, we will surely Get Screwed!”

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PNG Petroleum Minister Kua brushes aside claims of Threats on Gas Project

NBC News | 23 January 2020

Papua New Guinea Petroleum Minister Kerenga Kua has brushed aside claims of threats to close gas projects in Western Province.

This follows, Governor, Taboi Awi Yoto and North Fly MP, James Donald claims, the State Negotiating Team has poorly negotiated for the province and the landowners over the P’nyang Gas Project’ with the developer in Singapore last week.

The leaders have threatened the government to close P’nyang and Stanley LNG Projects before the close of business this Friday until the Oil and Gas Act is amended.

In his response, Minister Kua says constitutional law allows all minerals and petroleum is owned by the State and not by provinces and landowners.

He said only the State is empowered to commercialise these resources, and no other entity is by law empowered to do this.

Mr. Kua said leaders at all levels are entitled to express their views on issues related to resource project negotiations but State will make the final decision.

The Petroleum Minister urges leaders to remain calm as P’nyang Ministerial Committee is always on hand to discuss any discontentment.

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Papua New Guinea Gold mine to become a top tier mining asset while landowners’ rights ignored

Financial Post

The most basic needs and rights of Papua New Guinea landowners are being completely disregarded while a Canadian and Chinese consortium talks up the potential of an internationally significant gold mine ahead of a PNG Government decision on the mine’s lease renewal.

Porgera Gold mine in remote Enga Province of Papua New Guinea expired last year and consortium made up of Canada’s Barrick Gold Corp and China’s Zijin Mining wants their lease to be extended for another 20 years.

A majority group of landowners, the Justice Foundation for Porgera headed up by the PNG Resource Owners Chairman Jonathan Paraia believes Barrick has no intention to deliver on promises it’s making to reduce environmental destruction or stop practices that damage local lives.

“Barrick has had 20 years to adequately deliver on its promises to resettle landowners, provide housing, education, clean drinking water so how can we for a moment believe that it will start honouring promises made under new contracts,” he said

“How many more independent reports detailing environmental and human rights abuses need to be published before the mine is held to account,” he said.

Mr Paraia understands Barrick needs this lease to be renewed so it can conclude a deal with Chinese state-owned entity Zijin.

“If the lease is renewed Barrick will not see it out, it intends to divest its share to its Chinese partner or someone else,” he said.

In 2015 Barrick Niugini officials told Landowners to make an offer for 95% of shares in Porgera mine but we could only make an offer for 10% so there was no sale. Instead in 2017 it sold half its shares to Zijin. We believe its goal is to sell its remaining shares once the lease is renewed.

The Chairman of the Justice Foundation for Porgera is also extremely concerned about a 70 million kina (almost $20M US) donation made to the Enga Provincial Government last week by the Chinese Government.

“The extremely generous donation while a decision on the mine is imminent is highly suspicious at best, and deserves a high level of scrutiny,” he said.

Jonathan Paraia also wants Barrick and elements of the PNG Government to stop cherry-picking supportive minority landowners with conflicts of interest and listen to the vast majority who want Barrick out.

“In the last fortnight, as part of Prime Minister James Marape delegation to Enga, Minister Johnson Tuke, Minister Bryan Kramar and Mineral Resources Authority head Jerry Garry unofficially visited the mine site and met with Barrick employees and contractors who claimed to be landowner representatives.

“Two of the guests, in particular, Dick Pundi a director of Ipili Porgera Investments Ltd (IPI) and Maso Mangape an employee of IPI claim to represent the interests of Landowners when IPI is a major service provider to Barrick, so whose interests are they serving?” he said.

The Justice Foundation for Porgera is aware the Prime Minister is adamant to take over the Porgera Gold Mine but other representatives of government are acting against the interest of the Prime Minister.

“The people of Porgera and the Justice Foundation for Porgera know the Prime Minister James Marape is listening to the people and has the best interests of our country at heart.

“We stand behind the Prime Minister and support him to say Barrick out, it’s time Papua New Guineans profited from Papua New Guinea’s valuable resources,” Mr Paraia said.

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PNG police MOU with mining company concerning – academic

Radio New Zealand | 23 January 2019

A Papua New Guinean academic and lawyer says a new memorandum of agreement signed by police and an Australian miner sends the wrong message to the public.

PNG police commissioner David Manning this week announced that police would work together with Morobe Consolidated Goldfields to address law and order issues in the Wau/Bulolo area of Morobe Province.

“In doing so the [Royal Papua New Guinea Constabulary] acknowledges the importance of maintaining and preserving good order for a harmonious relationship between the mine and the affected community,” Mr Manning said.

The company is owned by Harmony Gold, which operates the Hidden Valley gold mine located about 150km south of Morobe’s provincial capital Lae.

The Hidden Valley mine operations have previously encountered problems with the death of a worker in relation to a landowner compensation bid.

An Australian National University PhD candidate and practicising PNG lawyer, Bal Kama, said that given a long history of conflicts between landowners and miners in PNG the newly-announced arrangement raised questions about the impartiality and objectivity of police.

Mr Kama said there were hardworking, honest police officers out there who were doing their best to uphold police values, but that such initiatives under the new agreement could undermine their good work.

“If the mining firm is willing to support bringing law and order and peace and harmony in the community then let them do it as part of their social responsibility.

“By funding community peace projects, funding NGOs that are engaged in making sure that there is harmony and law and order maintained in the community. They don’t have to go into a partnership with police.”

Mr Kama said operators in the extractive industries should also focus on paying their dues to the government and landowning communities on time in order to prevent conflict and ensure police received the resources they need in a timely fashion.

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Pressure rises in PNG gas standoff

The P’nyang gas agreement is becoming a test case for the Marape government’s promise to stand up to resource extraction firms

Craig Guthrie | Petroleum Economist | 22 January 2019

Papua New Guinea (PNG) failed again in mid-January to agree fiscal terms with ExxonMobil for the development of its onshore P’nyang gas field, raising the stakes for all parties involved in a wider project to double gas exports.

The failure of the state team negotiating in Singapore piles political pressure on the PNG government; Prime Minister James Marape rose to power last May on the back of pledges to reap more revenue from international resources firms and lift the vast South Pacific archipelago out of poverty.

It also increases the financial strain on private stakeholders. The P’nyang gas agreement needs to be sealed before a complex pre-Feed process can start for a larger associated liquefaction project, the $13bn Papua LNG, led by Total but also involving ExxonMobil and others, which is targeting FID this year and production in 2024.

PNG-based oil and gas exploration and development company Oil Search, a partner in the P’nyang (36.86pc) and Papua LNG (17.7pc) projects, stated last October that the delays meant it reduced capex on the project by 15pc last year, while noting engineering work and marketing cannot get underway until the talks progress.

ExxonMobil refused a deal offered by oil minister Kerenga Kua at the first round of talks last November. Kua said this was “disappointing”, claiming the terms, which remain confidential, were in line with similar extraction arrangements in place in Indonesia and Malaysia. Fresh from disappointing renegotiations with Total, PNG wants benefits that are “far greater than Papua LNG” and is seeking “a good deal, not a fast deal”, the negotiating team stated.

“In the P’nyang talks, the government appears to be seeking a better tax take, more local content and jobs opportunities, more project information from the operator, and a firm commitment to development of P’nyang in a defined timeframe,” says Credit Suisse analyst Saul Kavonic.

P’nyang, which is estimated to hold 4.4tn ft³ of gas in the West Highlands province, would support an additional train at the Papua LNG project (Total will supply the other two from separate fields). Each of the three trains will have capacity to produce 2.7mn t/yr. Once operational these would double PNG’s 2020 LNG exports, which are all produced at ExxonMobil’s PNG LNG facility at Caution Bay. Papua LNG is planned to share certain brownfield facilities as well as feedgas and export facilities with PNG LNG.

Weakened hand

A Fitch Solutions report last September warned that PNG’s fiscal position had worsened year-to-date. “The country has struggled to establish sustainable revenue streams to meet spending requirements, leading to persistent budget deficits, an unsustainable build-up of public debt and greater exposure to adverse economic or financial shocks,” noted Fitch.

PNG expert Colin Filer, of the Australian National University’s College of Asia and the Pacific, says ExxonMobil is “playing hard ball” because the projects are such a small part of its global portfolio. “It believes it can hold the PNG government’s feet to the fire, because of its fiscal woes”.

Australian bank ANZ stated in December that the lack of a P’nyang breakthrough will delay the forecast national economic recovery by 12 months. “A longer project dialogue will push the recovery out further, with a risk that extended negotiations could derail the economic upturn.”

The government also faces the ongoing threat of local resistance from West Highlands landowners. Regional leaders stated on 21 January that they had withdrawn their support for the agreement as it has “not incorporated their interests”.

Papua LNG also faces a wave of global competitors targeting an anticipated spike in demand for LNG in the mid-2020s that may or may not materialise. “A P’nyang gas agreement remains a precursor to the entire PNG LNG expansion project, which is competing for a rapidly narrowing market opening later this decade,” says Kavonic.

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ABG President refutes RTG claims

Autonomous Bougainville Government President John Momis.

One PNG | 22 January 2020

I refer to RTG Mining Inc.’s most recent announcement to the Australian Stock Exchange (ASX) dated 21st January 2020 whereby RTG deliberately made false claims to mislead their shareholders, the general public and the ASX.

Firstly, the Special Mining Lease Osikaiyang Landowners Association (SMLOLA) was an entity established under the controversial Bougainville Copper Limited (BCL) regime, which mistakenly placed landowners into individual blocks. This is in fact inconsistent with the traditional land inheritance system whereby land is owned by clans and families. The ABG has started the process to rectify this grave past mistake with the rejection of BCL’s licence over Panguna, thereby deeming all current mine affected landowner associations, including SMLOLA illegal, null and void.

So while it is true that RTG are the joint venture partner of SMLOLA as they have confirmed, I would like to confirm SMLOLA have no legal rights over Panguna and cannot enter into any legally binding agreements relating to Panguna. I am happy to advise however that the ABG will be assisting the true and genuine landowners to ensure proper social mapping is carried out in order to establish new legal landowner associations and entities.

Secondly, as per a media statement released from my Office on the 23rd December 2019, I would like to re-confirm and reiterate that the below RTG executives currently still have a travel ban on them, preventing them from entering Bougainville:

  1. Mr Michael J Carrick – Chairman of RTG Mining
  2. Ms Justine A Magee – CEO and Executive Director of RTG Mining
  3. Mr Mark Turner – COO of RTG Mining
  4. Mr Robert N Smith – Non-Executive Director of RTG Mining
  5. Mr Phillip C Lockyer – Non-Executive Director of RTG Mining

I also re-confirm and reiterate that this travel ban will not be uplifted under any circumstance. Whilst there was a travel ban into Papua New Guinea, it has recently been uplifted due to RTG’s lies and deceptions to the PNG government and immigration department about their purported involvement in the Mt Kare project – a project that the world knows it will not succeed. It is therefore concluded that RTG have taken advantage of the fact that both the PNG and ABG operate independently of each other and do not always consult each other on foreign companies, and that RTG’s interest in the Mt Kare project is merely an expensive ploy and deceptive tactic to be able to have a presence in PNG and access to their only real interest – the financial rewards of the Panguna pit.

RTG and their executives should be totally and utterly ashamed of themselves for their corrupt, disruptive and divisive behaviour. They have tried to take advantage of our landowners and people and have shown a complete lack of respect for government authorities. RTG have completely misled the markets for their own financial gain and convenience. The ABG will not rest until all RTG and their executives are banned for life from Bougainville and Papua New Guinea.

As it is my duty to protect the people of Bougainville from immoral charlatans, I appeal to the ASX, TSX and OTCQB, as your duty to protect current and potential shareholders, that you perform a full investigation into RTG Mining and their executives and their misconduct. My Government would be more than happy to assist you with any enquiries relating to RTG and their activities whilst in Bougainville.

For current and potential shareholders and financial markets, I hope that this clears up any confusion or misunderstanding on RTG Mining’s position in Papua New Guinea, Bougainville and Panguna.

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