Tag Archives: Rio Tinto

AFP PRESENCE AT BOUGAINVILLE MINE RAISES SUSPICIONS

Presence of the Australian Federal Police at Panguna is being questioned

Chris Baria | June 8 2019

The Chairman of Bougainville Hardliners Group and former combatant turned businessman, James Onartoo has called on the Autonomous Bougainville Government (ABG) Police Minister to explain what the Australian Federal Police (AFP) were doing at the site of the controversial Panguna mine on Wednesday, June 5.

According to Mr. Onartoo, members of the communities around the mine site became suspicious when they saw the Australian police taking GPS readings at various points around the mine. This points included the one where the mining company BCL considered building an airstrip in the early part of the Bougainville crisis, to bring in aircraft supposedly to evacuate expatriate mine workers and their families out of Panguna.

“I think the public is owed an explanation as to what is happening. To the best of my knowledge the AFP were ousted in 2007 on suspicions of spying on the ABG and the people of Bougainville by the former President, late Joseph Kabui.

“Their presence at Panguna, which is the site of so much controversy and disagreements plus issues of sensitive nature stemming from proposed reopening by ABG, raises serious questions considering the fact that in the past Australia always supported military intervention by Papua New Guinea Defense Force to regain control of the mine.

“If AFP can raid ABC office in Australia itself then they are capable of anything including maybe gathering intelligence on ground for the purpose of regaining control of Panguna and restarting the mine with use of force,” Mr. Onartoo said. 

Mr Onartoo said that it is a well known fact that Australia’s interest in the mineral deposits at Panguna never declined and Australian advisors to ABG have denounced agriculture, tourism, fisheries and other sustainable industries saying that only mining is able to finance Bougainville’s independence. Several companies which are vying to reopen the Panguna mine, which was shutdown by landowners in 1990, are also of Australian origin. 

The AFP party, which comprised of three policemen and two civilians including a doctor were escorted on their visit to the autonomous region by the Bougainville Service Commander, Francis Tokura and police personnel. They are also said to have visited the proposed border posts sites at Koromira and Kangu Beach.

Mr Onartoo said he had nothing to say about AFP visiting other parts of the Autonomous Region.

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Another ‘World Class’ Mining Company in ‘World Class’ Coverup

Rio Tinto’s QIT Madagascar Minerals mine in southeastern Madagascar. Image courtesy of Google Earth.

Madagascar: Rio Tinto mine breaches sensitive wetland

Edward Carver | Mongabay | 9 April 2019

  • A large mineral sands mine in southeastern Madagascar has trespassed into a “sensitive zone,” violating national law and raising the possibility that radionuclide-enriched tailings could enter a lake that local people use for drinking water, two recent studies confirm.
  • Rio Tinto, the London-based multinational that owns the mine, acknowledged the breach for the first time in a March 23 memo, more than five years after the breach initially occurred.
  • Rio Tinto will hold its annual general meeting April 10 in London.
  • The director of an NGO that commissioned one of the studies is a shareholder and said she hopes to speak about what’s happened at the lake.

A large mineral sands mine in southeastern Madagascar has trespassed into a “sensitive zone,” violating national law and raising the possibility that radionuclide-enriched tailings could enter a lake.

There is no evidence that radioactive elements or mine tailings have entered the lake so far, but two recent studies confirmed the encroachment of mining activities into the lake. Rio Tinto, the London-based multinational that owns the mine, acknowledged the breach for the first time in a March 23 memo to the Andrew Lees Trust (ALT), a social and environmental advocacy group that commissioned one of the studies.

The breach raises health and safety concerns in one of Madagascar’s most impoverished regions. The lake, part of a forested estuary system a few miles from the city of Tôlanaro, commonly known as Fort Dauphin, serves as a fishing and foraging ground for people in nearby villages.

“It would be a human rights and environmental catastrophe if you flood that estuary with radioactive water,” Steven Emerman, a Utah-based geophysicist and hydrology consultant who authored the 2018 study commissioned by ALT, told Mongabay.

Emerman said he worries that a cyclone could cause tailings in the mining basins to overflow into the lake or seep in if the water table level changes. The mineral sands being mined have high levels of uranium and thorium, and the removal of the mine’s main product, ilmenite, can increase the concentration of radioactive elements. Ilmenite yields titanium dioxide, used as a whitener in products like paint and toothpaste.

A different study published today by ALT found safe radionuclide levels in rivers and lakes in the area. It also found that the area around the mine, including river water, had high levels of uranium that could pose risks to local residents, although it’s not known if these levels are naturally occurring or caused by mining activities. The author of the study noted that she had to rely on “limited” and “questionable” data provided by Rio Tinto, and called on the company to improve its monitoring and management of radioactive materials. In response to the study, Rio Tinto maintained that the high uranium levels were naturally occurring and cited a baseline study as evidence.

Emerman and Rio Tinto have sharply different opinions about how best to protect the lake from mine tailings. Rio Tinto has set a barrier in place, but in his study, Emerman writes that the safety criteria that the company used to build it would be more appropriate for “storm drains at a shopping mall parking lot” and that reading Rio Tinto’s reports leads him “to believe that the dam was not designed to meet any safety criteria, but was simply ‘designed’ by piling up sand with a bulldozer.”

Emerman expressed further concern that the dam itself was made largely out of tailings — a fact acknowledged by Rio Tinto. This could contribute further seepage into the lake that the dam is meant to protect. “If you build the dam out of tailings, what good is the dam doing?” Emerman said to Mongabay.

Rio Tinto has initiated an action plan to assess and possibly redesign the dam (or berm — there’s debate about what to call it) before the end of the year, the company said in the memo.

In 2018, Rio Tinto commissioned Ozius Spatial, an Australian consultancy, to determine whether mining activities had breached the lake and buffer zone, as ALT had claimed. Like Emerman, Ozius found that the company’s mining activities had encroached not only all the way through the buffer zone on one side of the lake — littoral forest made up of unique evergreen species — but onto the lake bed.

Rio Tinto declined to publish the Ozius study and has not acknowledged the breach publicly, aside from its communications with ALT. The company did provide a copy of the Ozius study to ALT so that Emerman could use it is in his work. Neither Rio Tinto nor Ozius responded to requests for comment for this article.

It is unclear whether Rio Tinto’s encroachment into the lake was intentional. In its recent memo, Rio Tinto called the breach an “unintended occurrence that has produced several important learnings.” However, the company had been aware of the possibility of a breach for several years. In 2014, it asked Madagascar’s National Environment Office (ONE), a regulatory body, for permission to change the buffer zone around the lake from 80 meters (262 feet) — the standard, per national law — to 50 meters. ONE granted the request. Yet the Ozius study shows that by the start of 2014 Rio Tinto had not only already worked its way through the buffer zone but had encroached 52 meters into the lake itself, according to Emerman, who reproduced this finding in his own study

ONE inspected the breach in August 2018, deemed its impact “negligible” and chose not to take regulatory action, according to Rio Tinto’s recent memo to ALT.

Financial considerations appear to have driven Rio Tinto to mine near the lake, where the highest-quality ilmenite in the area occurs. In a 2017 memo to ALT, Rio Tinto explained its actions from a dollars-and-cents point of view. “The impact of complying with the 80m buffer zone would be 1) A 9 % loss of Reserves; 2) a non-optimal life of mine plan, the higher grade and lowest cost ore to the North East would only be accessible at the end of the mine life.”

In Madagascar, Rio Tinto operates through QIT Madagascar Minerals (QMM), which is 80 percent owned by Rio Tinto and, at least on paper, 20 percent by the government of Madagascar. QMM is the second-largest mining operation in the country. Rio Tinto has invested more than $1 billion in the project and sends most of the ilmenite to be processed in Canada. The company shipped its first batch of ilmenite in 2009 and operations could continue for 40 years across three sites, including places that border protected areas. Operations are currently underway only at the Mandena site, which breached the estuary system. (The estuary system is now a freshwater wetland, as Rio Tinto built a weir to close it off from the ocean before it began mining.)

Critics have questioned ONE’s independence and ability to act as a neutral regulator. ONE’s website lists Rio Tinto alongside the World Bank and the European Union as a financial backer. And because of government funding issues, Rio Tinto has to pay for the regulatory body’s staff to fly down from the capital, stay in local hotels and monitor the company.

“This sets up an obvious conflict of interest that no one is happy with, including QMM,” Pete Lowry, a Paris-based botanist with the Missouri Botanical Garden who has decades of experience working in southeast Madagascar and sits on QMM’s biodiversity and natural resource management committee, told Mongabay. “But the reality is that if monitoring is going to get done, QMM is going to pay for it.”

A ONE representative did not respond to a request for comment for this story.

Rio Tinto will hold its annual general meeting in London on April 10. Yvonne Orengo, ALT’s director, owns one share of the company and said she hopes to speak about what’s happened at the lake.

“It’s taken the Trust [ALT] two years and a huge effort to get Rio Tinto to admit the breach,” she told Mongabay in an email. “This highlights just how difficult it is for local people to hold QMM to account when it does wrong or fails in its obligations.”

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Bougainville’s tinderbox threatens to reignite

Bougainville Revolutionary Army fighters look down on the Panguna mine in 1996

An independence referendum and unresolved issues over the rich Panguna copper mine threaten to tilt Papua New Guinea’s tumultuous autonomous island back to civil war

Alan Boyd | Asia Times | December 4, 2018

Foreign mining companies are jostling for exploration rights on the Papua New Guinea island of Bougainville ahead of a crucial independence vote next year that some fear could revive tensions that sparked a civil war that killed 20,000 in the 1980’s.

The island will need mining royalties to maintain a viable economy if the referendum backs independence, but unresolved issues over the Panguna copper mine are still a sensitive point with traditional landowners. Villagers shut the pit down in 1989, triggering the previous lethal conflict.

The referendum is the culmination of the Bougainville Peace Agreement, which formally ended the decade-long bloody civil war. It will take place as the US and Australia aim to work closely with Papua New Guinea to develop its Lombrum Naval Base to counterbalance China’s growing maritime influence in the region.

In January, the Autonomous Bougainville Government (ABG) said that an indefinite moratorium had been imposed on work at Panguna, which was the world’s biggest open-cut copper mine when it was being operated by Bougainville Copper Limited (BCL), a unit of Anglo-Australian mining giant Rio Tinto.

Rio exited in 2016, transferring its 53.8% shareholding to the ABG and the Papua New Guinea government, but there has been speculation the mine could reopen. Papua New Guinea’s government gave its shareholding to traditional landowners in the Panguna area.

“If we went ahead now, you could be causing a total explosion of the situation again,” ABG president John Momis said after the moratorium was declared.

“As far as the people are concerned and as the government, we cannot allow foreign companies to be causing division and using a very emotional situation [on] the ground to cause another war.”

In 1972, there were suggestions of colonialism and commercial exploitation over a decision to grant a mining license to Rio Tinto after minimal consultation with local villagers. Bougainville was then being ruled by Australia under a United Nations mandate that ended with Papua New Guinea’s achievement of independence in 1974.

The Panguna mine effectively underwrote that process: at one point copper from the mine was contributing 45% of Papua New Guinea’s annual export earnings and generating more than US$740 million from tax income and dividends.

But little of this money reached tribal groups; instead, they complained that trailings from the mine were killing their fish and poisoning farmland. In 1989, the Nasioi people broke into the site and shut the mine down.

Autonomous Bougainville Government President John Momis. Photo: Youtube

When Papua New Guinea sent riot police and troops to the island, villagers formed the Bougainville Revolutionary Army, a rag-tag separatist group that plunged the region into a decade-long civil war that left most of its infrastructure in ruins.

A fragile peace was achieved in the late 1990s under monitoring groups led by Australia and New Zealand, but the wounds remain raw. Several tribes maintain “no-go” areas to keep foreign firms out, and the remnants of the BRA, known as the Me’ekamui group, only disarmed this October.

Bougainville, which has closer ethnic links to the Solomon Islands than Papua New Guinea, was granted a limited form of autonomy under a formal 2001 peace treaty. The referendum, tentatively scheduled for June 15 next year, will decide whether the island should become completely independent.

However, it will not happen unless the ANG can find some way to bridge the gap between developers and traditional landowners who fear a repeat of the Panguna fallout.

Rio Tinto left behind an environmental mess of sludge and rusting equipment that some analysts estimate could cost US$1 billion to put right. The firm contends that it has already complied with regulatory requirements.

Momis knows that without mining, Bougainville will stay part of Papua New Guinea, as the island managed to cover only 14% of its total expenditure of US$50 million last year from domestic sources — mostly sales of farm products. It is expected to need a budget three times bigger if it votes for independence.

Resistance fighters from the Bougainville Revolutionary Army (BRA) in a file photo. Photo: AFP/Torsten Blackwood

Leaving the door ajar, Momis has said that the moratorium only covers mining at Panguna, which is inaccessible in any case because of a “no-go” order. A new mining law passed in 2014 clarified the regulatory situation and has attracted interest from firms in Australia, China, Canada and elsewhere.

But there is a catch: the law gave traditional landowners control over minerals on their land and the right to participate in any development decisions that might affect their interests. So the fate of Bougainville’s separatist movement now rests with those who started it in the 1980s.

Landowners that do deals with mining companies will have to face the wrath of neighboring tribes that could bear the consequences of mining. There are strong risks that tensions could boil over even before the referendum.

The wild card in this game of chance is Papua New Guinea, which is not obliged to allow Bougainville to break away even if there is a “yes” vote.

Indeed, it may prefer to keep a tight rein on its renegade region, especially if predictions of a vast untapped treasure of copper, gold and other minerals are realized.

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CEDAW and Extraterritorial Obligations: PNG Activists Highlight Australia’s Role in Human Rights Violations

Papua New Guinea activists Ruth Saovana Spriggs (left) and Sabet Cox in Geneva. Image still from forthcoming IWRAW Asia Pacific video

Nikta Daijavad | IWRAW

At IWRAW Asia Pacific’s most recent From Global to Local training programme, run in parallel to the 70th CEDAW Session, we were joined by two activists from a small group of Papua New Guinea women working to expose the gendered harms of Australia’s large-scale extractive industries – which have operated across many provinces of Papua New Guinea for five decades. Dr Ruth Saovana Spriggs (left, above) is the director of the Bougainville People’s Research Center (based in the Autonomous Region of Bougainville), and Elizabeth (Sabet) Cox (right, above) is a technical advisor to HELP Resources and Voice for Change (based in the Sepik and the Highlands regions of Papua New Guinea) and an emerging women’s organisation in Hela – the site of Papua New Guinea’s controversial vast and expanding gas fields in a context of underdevelopment and armed conflict. These four local NGOs were supported by Development Alternatives with Women for a New Era (DAWN), to prepare and submit a shadow report to the CEDAW Committee’s review of Australia, held on 3 July.

Ruth and Elizabeth focused their advocacy on Australia’s failure to meet its extraterritorial obligations (ETOs) in relation to its financing of, and development cooperation with, risky and socially and environmentally destructive Australian extractive companies in Papua New Guinea. In recent years, activists have increasingly called upon states to fulfill such obligations. Relying on the Maastricht Principles on Extraterritorial Obligations in the Area of Economic, Social and Cultural Rights, they argue that states are obligated to ensure that non-state actors which they are in a position to regulate, including private individuals and transnational corporations, do not violate human rights. The Women’s International League for Peace and Freedom, for example, submitted shadow reports on the extraterritorial obligations of SpainSweden, and France with regards to arms transfers for the 61st, 63rd, and 64th CEDAW Sessions, respectively. FIAN International similarly submitted a shadow report on the extraterritorial obligations of Germany with regards to coffee plantations owned by German transnational corporations that were illegally evicting peasant communities in Uganda (66th CEDAW Session).

In Australia’s case, the state has provided critical financial support to extractive industries that have been assessed as high-risk for social and environmental impacts. In Bougainville, for example, Rio Tinto of Australia operated the Bougainville Copper Limited mine between 1969 and 1989 – until tensions over the dumping of tailings in the Jaba River, grossly unequal benefit sharing arrangements, and an influx of migrants from other provinces eventually erupted into a decade-long civil war with the Papua New Guinea government, with military support from Australia. When a military response failed, Papua New Guinea imposed a total blockade on goods, services and supplies, resulting in the loss of an estimated 20,000 lives, and countless war crimes of sexual violence. Ruth’s research has revealed that local women lost their traditional matrilineal authority, especially in relation to land rights and decision making. They witnessed huge social and cultural upheaval, bore the brunt of a long armed conflict and barely received USD20 in cash benefits annually.

The Australian government’s secretive Export Credit Agency – the Export Finance and Insurance Corporation (EFIC) – provides critical loans to ‘close the deal’ on new projects operated by Australian extractive companies when risk-averse banks will not. In 2009 EFIC provided a AUD500 million loan to enable Exxon Mobil and joint venture partners Oil Search and Santos to proceed with a liquefied natural gas project in the remote Hela region, despite warnings that support for the project could exacerbate already-existing armed conflict and violence against women. The lessons from Bougainville and from a succession of mining disasters have not been learned, and the gas fields in remote Hela Province have created a nightmare situation for women. The gas project start-up ignored the land-based armed conflicts among men and the extreme forms of sexual and gender-based violence against women and girls. Worsening armed conflicts have undermined Hela’s rudimentary governance, service delivery and justice systems and rising impunity for daily murders, assaults and rapes.

Ruth and Elizabeth advocated four priority obligations of the Australian government:

  1. guarantees of women’s security and access to justice in areas impacted by Australian extractive industries, including establishing a complaints mechanism to provide reparations for past harms;
  2. Australian companies to undertake substantive gender analysis and to ensure women give free, prior and informed consent prior to extractive project start-up;
  3. institution of gender-equal benefit sharing in land-owning and impacted communities; and
  4. gender-equal access to jobs and training in Australian-owned extractive industry companies.

Throughout the process, women leaders from the remote Hela province in Papua New Guinea communicated daily with Ruth and Elizabeth, expressing their great hopes that their voices would be heard. They have since expressed their appreciation to the CEDAW Committee and the process.

During Australia’s constructive dialogue, Committee member Nahla Haidar directed incisive questions to the Australian state delegation regarding state loan financing of Australian extractive companies in Papua New Guinea and development grants to company-led corporate social responsibility projects for women. She noted, “There seems to be a failure to learn from the conflict in Bougainville … To what extent will the [Australian] government engage with the UN Principles on Business and Human Rights?” She reminded the delegation that its 2016 Universal Periodic Review had recommended that Australia adopt a National Action Plan on Business and Human Rights, and Australia had responded that it would consider further measures for implementation of the Guiding Principles on Business and Human Rights. This has not yet resulted in an adequate response.

The concerns highlighted in the shadow report on Australia’s ETOs are well reflected in Australia’s Concluding Observations. The Committee recommends that Australia develop a National Action Plan on Business and Human Rights, incorporating a gender perspective, ensuring that all large-scale extractive projects have obtained free prior informed consent from locally affected women, and establishing a specialised mechanism to investigate violations of women’s human rights by corporations based or registered in Australia or receiving subsidies from it.

Despite the lack of a clear commitment from the Australian delegation to address this issue, Ruth remains hopeful that highlighting the nature of Australia’s extractive industries in the international arena will eventually have a positive impact. As she said in our interview, “Unfortunately I was a little disappointed, but at least [the Australian delegation] heard it … And to me, it is a plus that [the issue] is at least registered at this level.” She also believes that continuing to strengthen the relationship between academic research and advocacy-oriented spaces like CEDAW will help bring to light the depth and complexity of the human rights violations taking place in Papua New Guinea.

Elizabeth added, “It’s given me hope that we can do more back in Papua New Guinea, and because the autonomous region of Bougainville is preparing for independence, [this] can be a new starting point for them to hold their independent government accountable to address the rights of women in the new state.”

Bougainville is slated to hold an independence referendum on 15 June 2019.

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Freeport Seals Pact With Indonesia on Giant Grasberg Mine

Eko Listiyorini and Viriya Singgih | Bloomberg | September 27, 2018

  •  Definitive agreement to allow Inalum to raise stake to 51%
  •  Accord is culmination of more than a year of negotiations

Freeport-McMoRan and Indonesia signed a binding landmark agreement for the U.S. miner to hand over majority control of the giant Grasberg copper and gold mine to a local state-owned firm, in the country’s biggest ever divestment by a foreign resources company.

Freeport Chief Executive Officer Richard Adkerson and PT Indonesia Asahan Aluminium President Director Budi Gunadi Sadikin signed a divestment deal and two other pacts in Jakarta on Thursday. The transfer of majority shares to Asahan Aluminium will happen once the company makes a payment of $3.85 billion to Rio Tinto Group and Freeport, Sadikin said.

The U.S. producer will continue to operate the mine under the agreement, which culminates more than a year of talks. The accord will allow Indonesia to issue a special mining license for Freeport to run the world’s second-largest copper mine through 2041. Freeport and Asahan Aluminium, known as Inalum, will complete the transaction before the year-end, Sadikin said.

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MP upset at Australian advisors in Bougainville

A lake in the pit of the long defunct Panguna mine in Bougainville. Photo: www.travelinspired.co.nz

Radio New Zealand | 23 August 2018

An MP in the autonomous Bougainville parliament says Australian aid to the region is being used to jockey for position ahead of the vote on possible independence.

Bougainville is due to vote next year on whether to remain part of Papua New Guinea or choose independence.

Donor nations have started increasing their support but MP Joseph Watawi is taking issue with Australia sending in teams of advisers, without consultation.

He says the advisers are there to gain political power and influence for Australia when what Bougainville needs are nurses, doctors and engineers.

Mr Watawi told Don Wiseman he thinks the Australian assistance is focused on the possible re-emergence of the former Australian owned mining company, Bougainville Copper Ltd – the company which sparked the Bougainville crisis.

TRANSCRIPT

JOSEPH WATAWI: So rather than Australia trying to get back here under the cover of BCL, to re-open the mine, I think it is a fair thing for them to seriously look at how they can provide some form of redress to the people of Bougainville through supporting the current, ongoing reconciliation process in Bougainville. That’s what I see it is currently lacking.  

DON WISEMAN: You have been critical of Australia sending in advisers but the truth is isn’t it, that the ABG – the Bougainville government – still needs advice. It hasn’t got a lot of the capacity it needs if it is going to get itself organised for this vote.  

JW: So called advisors, which have flooded the Bougainville administration, I think some of these are absolutely unnecessary. Only on areas which we think we need critical advice then we should be able employ people that we identify and people that might come from Australia, but there are other places. In PNG we also have a lot of retired public servants who may be able to engage in terms of  providing capacity in whatever administrative area that we think we need and require that kind of advice. I don’t see a wholesale advisory capacity that should come from retired Australia. It is like Australian aid is being given to Bougainville and we take it on the right hand and they take it back on the left hand. So it really doesn’t make any sense.

DW: When you say unnecessary advisors, what are you thinking of?

JW: Well in areas where we think it is necessary that we should have some advisers, then we should engage people in those areas that must be identified in terms of strategic advice in what ever areas. For example in terms of growing the economy, I think it is an area we think we can probably need some expertise in giving us some rough forecast on what they think the economy will be like in the next ten years down the road. So these are some of the areas I think we could be able to take on advice, but anything else, in terms of weapons disposal – what do they know about weapons disposal when we own the weapons here, and we think we had ways and means to deal with people who are holding onto weapons.

DW: The New Zealand government has also stepped up its involvement and I see from a press release you have put out that you are quite happy with what New Zealand is doing. So what is the difference between what New Zealand is doing and what Australia is doing?

JW: New Zealand I think, because they are also based with the culture of the Maori people and I think they know how to deal with the indigenous people and the manner in which they offer their support and assistance, particularly on the policing service, I see the role New Zealand plays also involves some kind of customary, cultural relationship that sort of enhances the manner and the attitude they are offering the kind of advice and support, in terms of capacity for Bougainville, and that’s the difference I see. 

DW: There are discussions around restarting mining on Bougainville, and BCL is one of those, but it is not of course an Australian company anymore is it? You have tied this Australian involvement into a possible return of BCL but BCL is now owned by Bougainville and the PNG governments, isn’t it?

JW: The sale by Rio Tinto to the PNG government and the ABG was a rush job, and I think it was just a way out, of Rio Tinto not willing to address the legacy issues in terms of the environmental damages and all of these other things that they had created while operating the Panguna mine. And not only that but even they wanted to basically pass on some of these liabilities to the ABG. I think Rio Tinto on that note basically, just acting, like, you know, we don’t want to know what happened to you guys. We picked up the wealth and whatnot from your ground, and therefore we do not to come and recognise the difficulties you are suffering, the pain the people have gone through. From my observation and analysis this is very unfair.    

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IS BOUGAINVILLE ON THE BRINK OF WAR?

MOST OF THE NEWS COMING OUT OF PAPUA NEW GUINEA TODAY IS ABOUT THE REFUGEE CRISIS ON MANUS ISLAND. BUT 1,000KM SOUTHEAST OF MANUS ON BOUGAINVILLE ISLAND, A LITTLE-KNOWN STORY ABOUT THE BLOOD-SOAKED 40-YEAR-LONG INDEPENDENCE STRUGGLE OF A QUARTER OF A MILLION PEOPLE IS APPROACHING AN ENDGAME.

Ian Lloyd Neubauer | Penthouse | 13 July 2018

Cut from the pages of a glossy travel brochure and just smaller than Hawaii’s Big Island, Bougainville is blessed with incredible natural resources: sugar-white beaches, fisheries, hyper-fertile soil and one of the largest untapped mineral deposits on the planet – copper, silver, gold and uranium estimated to be worth hundreds of billions of dollars.

The largest known concentration of minerals lies in Panguna Mine, a vast hole in the ground in the Guava Mountains of central Bougainville. Between 1972 and 1989 it provided nearly half of PNG’s GDP and made billions in profit for its operator, Bougainville Copper Limited (BCL), a former subsidiary of Rio Tinto.

But while less than one per cent of those profits were reinvested in Bougainville, hundreds of millions of tonnes of tailings – the toxic by-product of industrial mining – were dumped straight into rivers, turning vast tracts of once-fertile farming and hunting grounds into barren, moonlike wastelands.

In the late 1970s, a landowner group led by Francis Ona presented BCL with a multi-billion dollar cleaning bill. BCL, however, claimed it was in compliance with the law while concurrently insisting it had not damaged the environment. It continued to dump tailings into the rivers like a careless tourist might drop a cigarette butt on the beach.

In 1988, push finally came to shove. Ona and his mob broke into BCL’s storerooms, stole a bunch of explosives and blew up Panguna’s power lines. The event marked the start of the longest conflict in the South Pacific since WWII and the world’s first successful eco-revolution – an episode of military history that has drawn parallels with the 2009 James Cameron film Avatar.

PNG sent in its army to crush the rebels, pitting Australian-supplied helicopter gunships and gunboats against a ragtag militia armed with slingshots and homemade rifles. When that failed, soldiers trained their sights on the general population, burning down villages, using rape as a weapon and executing alleged collaborators en masse. And when that failed PNG applied a cruel Australian-backed naval blockade, depriving the entire island of fuel, medicine and all contact with the outside world.

By the time a lasting peace agreement was signed in 2001, 15,000 to 20,000 Bougainvilleans – 10 per cent of the population – had been killed or succumbed to illnesses. For its woes, Bougainville was granted autonomy and tacit control of its fantastic mineral wealth, including the US$50 billion worth of copper and gold left at Panguna.

Now, a new-look independently listed BCL is plotting its return to Panguna, promising jobs and prosperity for all – despite not lifting a finger to clean the mess it left behind. Astonishingly, the Autonomous Government of Bougainville is courting the proposal because it desperately needs cash for an independence referendum scheduled for June 2019 and the prospect of running the world’s newest country the following year. But many Bougainvilleans hold serious grudges against BCL and warn if the company returns, war will follow.

HAPPY VALLEY

During the ’good times’ of the 1970s and 1980s, Arawa and its port Kieta, an hour’s drive from Panguna, was the second richest town in PNG. Hotels, restaurants and banks lined Happy Valley, Kieta’s dreamy beachfront strip, while cruise boats and sail craft crowded around the old yacht club.

All that remains of Kieta today are ruins overgrown with jungle and the wrecks of two small steamships at the end of a pier where Queen Elizabeth II and her royal entourage disembarked during a state visit in 1974. Arawa hasn’t fared much better; its wide boulevards lined with overgrown fields, stain-coloured apartment blocks and abandoned gas stations.

In Arawa I meet Philip Miriori, former private cabinet secretary of rebel leader Francis Ona, who died in 2005. Today Miriori is chairman of the Special Mine Lease Osikaiyang Landowners Association (SMLOLA), a group of 2,000-odd landowners who under the new Bougainville Mining Act hold rights not only to the topsoil but also the minerals underground. That makes Miriori one of the most powerful men in Bougainville and his opinion of BCL a matter of concern.

“BCL does not have any compassionate feelings. I have seen what they are capable of,” he says. “One night during the war, the PNGDF (PNG Defence Force) woke up everyone in my village and made us stand in a line while they burnt all our houses. I hold BCL directly accountable for what happened that night because BCL provided the soldiers with funding, logistics and shelter. Not as long as I am alive will I ever accept BCL coming back.”

Allegations of BCL’s complicity in Bougainville’s war stem back decades and have been corroborated by the highest level of government. In 2011, SBS’s Dateline unearthed an affidavit signed by former PNG Prime Minister Michael Somare that reads: “Because of Rio Tinto’s financial influence in PNG, the company controlled the government.” In a separate affidavit, former PNGDF general Jerry Singirok said the army “functioned as the corporation’s personal security force and were ordered by BCL to take action to reopen the mine – by any means necessary”.

BCL refused to comment for this story. But in a shareholder update released in October, the company claims it “has always maintained positive relationships in Bougainville” and “continues to respectfully build relationships with a range of stakeholders, including project area landowners”.

Yet in the very same document, the company scolds Miriori for “attack[ing] BCL through the media by using the title of SMLOLA chairman to convey the misleading impression that there is a united view of opposition to BCL”.

The notice also refers to a SMLOLA leadership dispute between Miriori and his cousin Lawrence Daveona, whose relationship with BCL stems back decades. Daveona was once president of the Bougainville Development Corporation, a purported BCL development fund that was run like a Fortune 500 company with interests in engineering, logistics and even mining. He was also a former director and secretary of BCL’s Roads Mine Tailings Lease Trust Fund – a body set up to administer compensation payments to Panguna landowners.

Daveona refused comment, citing ongoing court proceedings with Miriori. But he pointed out Miriori has a corporate sponsor of his own: RTG Mining, a Perth-based consortium that operates seven mines in five countries and is challenging BCL’s bid to reboot Panguna.

Miriori acknowledges he’s on RTG’s payroll but says his support for the company is based the award-winning environmental and social policies it has demonstrated at Masbate, the largest operating gold mine in the Philippines. “RTG will work well with the community,” he opines, adding: “If this story doesn’t go well, you will not be welcome back in Bougainville.

LEGACY PIT

In BCL’s October shareholder notice the company claims it is “increasing its presence in central Bougainville through the engagement activities of our local team”. 

Yet BCL has no official presence in Arawa. And it’s hard to imagine how a car with BCL logos could get past Alex Dakamari, a crusty old rebel with hangdog features who controls Morgan’s Crossing Checkpoint – a roadblock set up by Ona in the early 1990s on the only carriageway leading up to the mine.

“BCL are wasting their time. If they come back, we will fight,” Dakamari scowls. “We don’t want the mine reopened – full stop! Otherwise, all our money will go to white people like in the past. We were the owners and they turned us into beggars. They can’t get away with it again!”

Before it closed, Panguna was the largest open-cut mine in the world – 2.5 kilometres wide and half a kilometre deep. On one side of this titanic-size eyesore, a wall of untreated tailings hundreds of metres high marches slowly down a ravine. Millions of litres of opal-blue water rush from pit water drains on either side of this wall, forming waterfalls of the damned that lay waste to all life in the valley far below.

Dapera is a village that once sat right on top of the mine. In the early 1970s, BCL moved Dapera’s residents to a squatter settlement built on a plateau of crushed rock not far from the ore-sorting plant. A desolate collection of hardscrabble shacks, Dapera II is now home to a few hundred impoverished landowner descendants like Jayden Frankie.

“You can see the destruction BCL did to this community,” he says. “Before my father had good land. This is not good land. We can’t grow crops and when heavy rain falls, rocks in the ground turn blue and green.”

His friend, Richard Onio, voices similar sentiments. To find good land for farming we have to walk up to those hills,” he says, pointing to a steep ridge. “But it’s dangerous in heavy rains because of landslides.”

What do they think about the idea of a BCL comeback?

“They would not be welcome,” says villager Freddy Bernora. “We would send them off. They stole billions of dollars from us and I do not see how this company has changed.”

Frankie says he wants RTG to reopen the mine:

“We have seen some pictures of how RTG works in the Philippines, how people there live side-by-side with mining. They showed us how they produce benefits for landowners. They seem to respect landowners.”

“For me,” says Onio, “I am with neither RTG or BCL. I am neutral. I want to see if they meet our terms and conditions. I am not convinced by either side yet.”

CAESAR’S PALACE

On another plateau above the pit lies a small city where BCL housed more than 2,000 employees during the ’good times’. Today, around 8,000 landowners and squatters reside in the concrete skeletons of residential towers Ona and his mob set fire to after BCL withdrew. Masked in heavy fog, carpeted in moss and spattered with graffiti, it has the look and feel of a set from the Planet of the Apes.

Philip Takaung, Ona’s 77-year-old half-brother and Miriori’s deputy, is Caesar of this post-apocalyptic world. With the frame of a silverback gorilla and a crushing handshake to match, he makes an intimidating presence when I find him congregated with family and friends on the top floor of the tallest tower.

“When BCL came here and started polluting our land, we didn’t know anything about minerals. We had no education so they took advantage of us,” he says. “When we asked them to clean up the rivers, they did a feasibility study and said there was nothing poisonous in the water. We said NO! Our crops, our rivers, everything is dead! But they ignored us. They ignored us for 10 years until we took action. I was on that team with Ona that blew up the power lines.”

Takaung shows me his weapon of choice during the conflict: a nine-foot-long pole with a Y-shaped head known as the ‘Rambo Stick’ – a slingshot so powerful it can puncture a hole in a car, or take off somebody’s head. “This weapon is very good because it makes very little noise,” he says. “When you fire it, the enemy has no idea where you are. Then you can fire again.

I ask Takaung how many soldiers he killed during the war. He looks at two small children in the room who are glued to his every word, decides against answering and continues with his sermon:

“BCL burnt our villages. They tortured our people. They cut off people’s hands and threw them from helicopters. They raped our women, the young children, the men and old ladies! They put the machete in between women’s legs! I saw it! They slaughtered people like they were animals!”

On the way back to Arawa I stop at Anewa Bay, home to Bougainville’s modern port facilities.. There I meet port worker Francis Baubake, a withered old man in his fifties with a wooden leg and a terrible story to tell.

“In 1996, the PNGDF got a new mortar bomb that was untested. So they tested it on my family, “ he says. “We were in church in a refugee camp in Buin in the south when it hit us. My daughters Brenda and Alvina, seven and 12, and my wife Sicilia were instantly killed. I lost my leg,” he says, tapping his wooden stump.

I ask Baubake who he holds accountable for his loss. He stares numbly into the middle distance and thinks for a while before mumbling: “The PNGDF. The PNGDF and BCL.”

But when I ask what might happen if BCL returns to Bougainville, he answers without pause. “War,” he says, grinding his teeth. “War.”

THE NO-MINING VOTE

On my fourth day in Bougainville, I am struck with malaria and spend the next 24 hours shivering in bed, my joints and lower back burning with pain. The fever dissipates the next day but the experience makes me ponder the fate of an estimated 5,000 Bougainvilleans who succumbed to malaria during the blockade of the 1990s, and the poor state of health of most islanders today. In a squatter settlement next to my guesthouse, I find a man in his twenties with a cancer the size of a football growing from his heel.

More than half of all adults here are obese, while alcoholism is endemic. 

The war took everything out of everybody here and the trauma has been passed onto this generation,” says Geoff McAndrews, a Californian who recently opened Bougainville’s first surf camp. “There are no jobs. The only thing they have for entertainment is volleyball and homebrew.”

Over the next few days, I learn a significant minority are pro-BCL. “If BCL comes back, they can fix the environmental issues because they know all about them,” says accountant Lindsay Kalio. “I don’t think any other company can do this as we have no relationship with them.

Yet more than half of all islanders I speak to oppose any kind of industrial mining.

Our previous experience with mining was pollution and violence so I don’t want mining to come back,” says Alex Takena, a fisherman in Kieta. “We should focus on sustainable industries like copra (coconut) and cocoa farming.”

Lawrence Robert, a carpenter in Arawa, agrees. “I don’t think Panguna should reopen because our island is tiny and if miners come back, they’ll tear it to pieces. We should have tourism instead to promote our culture and heritage.”

Adds John Boscoe, a subsistence farmer from Oemah village in the island’s south: “Mining did not benefit any of us in in the past but we all lost our homes. If it happens again, the Panguna landowners will drink milk and honey and we will get nothing.”

The SMLOLA discounts anti-mining sentiment. “These people have to look at the bigger picture,” Miriori says. “Mining is the right choice for Bougainville because we need the revenue if we want to become an independent nation and generate employment and security. Panguna will reopen, whether they like it or not.”

BETTER THE DEVIL YOU OWN

A week passes until I regain enough strength to make the bone-jarring four-hour drive from Arawa to the capital Buka, which is as fly-blown as a place can possibly be.

When I arrive the city has been under a total electricity blackout for close to a week for reasons no one can explain. When I visit Bougainville’s House of Representatives in the middle of the day to make an appointment with President John Monis, no one is there. Ditto at the Ministry for Mineral and Energy Resources and BCL’s little office.

Later in the day, news breaks that the SMLOLA leadership dispute has ended and Miriori has emerged victorious. It sees RTG’s share price soar 83 per cent in a single day and the inking of a “historic” deal between the consortium and the SMLOLA.

“The Chairman and Mr Daveona have also pledged support for RTG as the preferred development partner,” RTG says in a statement. “This is a historic and important step for the landowners, with RTG being the first mining company that has been endorsed by the SMLOLA in 30 years.”

But the victory is short-lived. Bougainville Minister for Minerals and Energy Raymond Masono accuses RTG of trying to sneak into Panguna through the back door. “The Autonomous Bougainville Government rejects companies that think they can bribe their way into people’s resources by giving certain individuals money to gain landowner consent,” he says.

RTG rigorously denies it has bribed landowners even though Miriori admitted to me that he is on their payroll. However BCL has been busy handing out money to landowners, too.

In March of last year, BCL distributed US$1.5 million in compensation to landowners at a public ceremony in Buka attended by Masono. “It is not the devil that we used to know, but it’s now the devil that we own,” Masono said at the ceremony, adding that it would be foolish go out looking for other developers.

Masono’s comment about “the devil that we own” refers to Rio Tinto’s June 2016 decision to finally call it quits on Bougainville – and its subsequent donation of its majority shareholdings in BCL to the governments of Bougainville and PNG.

RTG chairman Michael Carrick says the move was in part an attempt by Rio Tinto to stack the deck in BCL’s favour. But the cards had already been stacked in a very big way by the authors of the 2015 Bougainville Mining Act, who gave BCL the first right of refusal to redevelop Panguna.

RTG’s Carrick insists the Act no longer applies. “BCL ’claims’ it has first right to the exploration license under the mining act,” he says. “But our legal advice is that the renewal application for extension of the term of their licence is invalid because it was submitted out of time and was incomplete.”

For his part Masono remains nonplussed, insisting BCL is still in the box seat and RTG doesn’t even have a seat on the table. “Right now, the only legal applicant on the exploration tenement is BCL,” he says. “Until that process is completed, there are no other applicants or applications over the same tenement. That’s the position of the government.”

THE PRESIDENT SPEAKS

On my last day in Bougainville, I score an interview with President John Momis at Buka’s tin-pot airport. Right from the get-go he contradicts Masono’s position and corresponding claims by BCL that its proposal has the support of the Autonomous Government of Bougainville.

“Currently we do not have a preferred partner. We will ask people who are interested to submit their applications and we will scrutinise their applications quite stringently,” the President says. “We are open to discussions with BCL but there’s whole new dimension today. They need to win the support of landowners who own the resources.”

I ask him what he thinks about RTG’s competing bid to redevelop Panguna, and of rumours that China is eyeing the mine.

“We are not sure about RTG,” he says. “They have to convince us first. I don’t know if they are in a strong position. As for the Chinese, they are not in the picture right now. But we are open for business.” 

And so the race for Panguna’s riches continues with no clear frontrunner. But no matter which company wins, three things seem certain.

First, the bulk of Panguna’s riches will inevitably end up in the pockets of oligarchs, shareholders and hopelessly corrupt officials instead of a sovereign wealth fund where it belongs. This prediction is drawn from the ’resource curse’, which dictates countries with lots of minerals tend to have less economic growth and democracy than countries with fewer natural resources. Hundreds of studies have been undertaken to prove the theory, though one need look no further to Hela Province on PNG’s mainland to see it happening in real time. There, ExxonMobil’s A$24 billion Liquefied Natural Gas (LNG) project has failed to deliver any significant development outcomes for landowners. “In fact, it has, in important ways, made life worse for the majority of people living in the project area,” says Michael Main, an Australian National University doctoral student conducting fieldwork in the area.

Which leads to prediction number two: if Panguna reopens, there will be blood. According to the World Bank study ‘Natural Resources and Violent Conflict’, countries that export around five per cent of GDP have a six per cent risk of conflict. But when exports reach 25 per cent of GDP, the probability of conflict climbs to 33 per cent. If Panguna reopens, exports of minerals will account for close to 100 per cent of Bougainville’s GDP. That doesn’t bode well under the World Bank’s formula. And despite reassuring me the plans to reboot Panguna’s will definitely go ahead, a fortnight after I leave Bougainville he changes his mind, announcing an indefinite moratorium.

We will not allow this project once again to reignite the wounds of the Bougainville crisis and distract our focus for restoring peace and our preparation for our referendum in 2019,” he told New Zealand’s Asia Pacific Report.

The decision is a breath of fresh air and a rare example of a politician in PNG making an unpopular and unprofitable decision that is beyond a shadow of a doubt in the best interest of constituents.

My final prediction for Bougainville? That the people will overwhelmingly vote in favour of self-determination when they go to the polls in 2019. “We in Bougainville have a huge passionate ambition,” Monis told me before I left, mirroring the thoughts of every Bougainvillean I interviewed on the subject. “And that ambition is to liberate ourselves from all kinds of transgressors, evil and marginalisation so there will be unity to affect the kind of changes we need to truly become free.” 

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