Madagascar environmental regulator under scrutiny for Rio Tinto relationship

Published by MAC on 2019-11-25
Source: Mongabay

Madagascar regulator under scrutiny in breach at Rio Tinto-controlled mine

by Malavika Vyawahare

Mongabay

20 November 2019

A breach at an ilmenite mine in Madagascar that came to light earlier this year is drawing attention to possible lapses on the part of the country’s environmental regulator.

A group of civil society organizations has asked the Malagasy government to intervene in the matter and to hold consultations to strengthen regulatory oversight of the extractive industries.

In response, the Malagasy government said it will look into the actions of the National Office for the Environment (ONE), the agency responsible for overseeing the mine, which is owned by London-based mining giant Rio Tinto.

However, two months on, the government has shared no updates about its inquiry with the civil society groups that requested its intervention.

The government of Madagascar is looking into the actions of its top environmental regulator in the case of a buffer zone breach at a mineral sands mining operation in the southeast of the country.

Five years ago, the QIT Madagascar Minerals (QMM) ilmenite mine breached its buffer zone around Lake Besaroy. In March, the mine’s owner, London-based mining giant Rio Tinto, sent a memo acknowledging the breach for the first time to the Andrew Lees Trust UK (ALT UK), a social and environmental advocacy group. Activists fear that radionuclide-enriched tailings, residue from the mine’s mineral extraction process, could contaminate the lake, which locals use for drinking water. They also say the breach highlights the problematic relationship between the mine’s regulator, the National Office for the Environment (ONE), and the companies it is supposed to oversee.

Rio Tinto, which owns an 80 percent stake in QMM, has invested about $1 billion in the mine, which is the second-largest in Madagascar, spread across 6,000 hectares (14,800 acres). Ilmenite extracted from the sands here is rich in titanium dioxide, which is used to produce pigment that gives a white finish to paint, plastic, paper and dye.

The government’s inquiry was prompted by a letter sent by Publish What You Pay (PWYP) Madagascar in August to the environment minister and the minister for mines. The letter, supported by several Malagasy and foreign civil society organizations, drew attention to a lack of transparency and possible regulatory lapses on the part of the ONE in the case of the QMM breach.

“PWYP and ALT UK asked in writing and verbally on multiple occasions since last year for Rio Tinto/QMM to provide copies of the ONE reports on the assessment of the QMM buffer breach,” Herinarahinjaka Eryck Randrianandrasana, the national coordinator at PWYP Madagascar, said in an email. “In particular to provide evidence of how the claims made by Rio Tinto that the Malagasy regulator deemed the impact of the breach to be ‘negligible’ had been reached. Their repeated failure to do so promoted the PWYP action to write to the Malagasy Government.”

In an August email to PWYP Madagascar, the minister of environment promised to investigate the matter.

The ONE is responsible for ensuring that public and private investments do not pose environmental risks. It is tasked with implementing the Compatibility of Investments with the Environment (MECIE by its French acronym) that lays down rules about conducting environmental impact assessments (EIAs), holding public consultations, and penalties for violations. However, the ONE, like many other Malagasy regulatory agencies, is short-staffed and resource poor. For projects that require EIAs, which are done by the project promoters but must be signed off by ONE, the promoters pay annual fees to cover the costs of subsequent monitoring.

In a statement Rio Tinto issued to Mongabay in response to emailed questions the company said that “QMM pays approximately US$35,000 – $40,000 per year in these statutory fees, depending on the specific activities planned and delivered during any given year.”

The breach has highlighted what activists with PWYP and other organizations say are flaws in the regulatory mechanisms that govern extractive industries like mining. Activists raised concerns for several years about a possible breach at the Rio Tinto mine into the buffer zone around Lake Besaroy. But until sending its March memo, the company did not confirm the existence of a breach.

“The incursion occurred between December 2014 and January 2015,” the Rio Tinto statement said, adding that “the issue was raised with ONE as the environmental regulator when it was confirmed in 2018, and ONE inspected the area in September that year.”

The confirmation of the breach the statement referred to came from a 2018 study Rio Tinto commissioned an Australian consultancy called Ozius Spatial to carry out. According to Rio Tinto, the ONE did its own evaluation of the breach, deemed the impact “negligible” and did not take any regulatory action. In its March memo to ALT UK, Rio Tinto acknowledged that the mine had breached the buffer zone but said there was no evidence of significant damage, citing the ONE’s evaluation of the breach. The company continues to maintain that position.

“The impact of the disturbance to the ground and to the invasive vegetation prevalent within the area, along with the benign composition of the sand, which is also typical of the area, would not be expected to result in immediate, widespread, or sustained pollution or sustained physical damage,” the Rio Tinto statement said.

“That is a question for ONE. We are not aware of any formal inspection report,” it said in response to a request from Mongabay for the ONE report on which the company’s assessment is based. The ONE did not respond to requests for a copy of the report.

What raised red flags, according to the civil society organizations’ petition, was that Rio Tinto’s outlay for supporting the ONE’s monitoring activities remained relatively unchanged for the 2017-2018 period compared with previous years. “The lack of an increase in Rio Tinto/QMM financial contributions to the ONE indicates that no additional studies were undertaken and no expert inputs were requested or contracted by the ONE for the buffer zone inspection in 2018,” the petition noted.

The breach has raised larger questions about the ability of regulators to provide oversight in cases where they are heavily dependent on the companies they are supposed to regulate. “Local people have a right to information that they cannot get at the moment, and the right to live in a safe environment, which cannot happen if the regulator is not actively protecting these rights,” said Yvonne Orengo, ALT UK’s director. Orengo owns one share in Rio Tinto and has consistently raised questions about the QMM mine’s social and environmental impact at the company’s annual general meetings.

“The request of the letter is for a round table with Malagasy civil society in order to review and revise the Decret MECIE and mining code,” Randrianandrasana said. “In particular, to close gaps that allow extractive companies to pay the regulator, the ONE, to carry out evaluations of their activity but which does not then compel them legally to publish the results or to transparently share reports and findings.”

The mining code is expected to be revised in 2020 and Malagasy civil society organizations are pushing for more transparent and inclusive consultations on it.

Andrianasolo Mamialisoa, an ONE official, told Mongabay in an email that the environment ministry had transferred the civil society groups’ letter about the QMM case to the ONE in September and that the concerned ONE department had shared some responses with the ministry. The minister, in his email to PWYP Madagascar, said that the ONE would keep the NGO updated about developments in the inquiry. As of the second week of November, however, Randrianandrasana said PWYP Madagascar remains in the dark about the progress of the government’s inquiry.

Madagascar’s ministries of environment and of mines and strategic resources did not respond to Mongabay’s requests for a comment at the time this article was published.

Malavika Vyawahare is the Madagascar staff writer for Mongabay. Find her on Twitter: @MalavikaVy

A small clarification. The Andrew Lewes Trust is a British registered charity that was set up and has been serving communities in Madagascar since 1995. It is not a "group", and its advocacy work is premised on commitments to amplify the voice and rights of citizens in southern Madagascar, where it has done the majority of its work. The ALT UK website is currently being redesigned but you can explore ALTUK's work, advocacy actions, and the reports on Rio Tinto/QMM breach at http://www.andrewleestrust.org/andrew.htm A further clarification: although Rio Tinto contracted a study of the QMM breach by Ozius, and Ozius confirmed encroachment, Rio Tinto/QMM maintained the mine was 'compliant'. So it was the independent evaluation of the breach by Dr Steven Emerman, ALT UK's contracted hydrologist, and the persistent enquiry by ALT UK that finally forced the company to review the situation further in October 2018 and finally admit to the breach in March 2019, two years after the inquiry began.

Since the breach broke national laws, the question as to why the ONE had not taken any regulatory action, eg sanctions, was cause for concern, as was the failure to evidence how it had drawn conclusions that the impact of the breach was "negligible". There is ongoing inquiry into the presence of radionuclides (elevated uranium) in waters surrounding the mine where local people draw their drinking water. See the briefing at http://www.andrewleestrust.org/blog/?p=1050