Czech Republic & Rio Tinto

Czech Republic & Rio Tinto

From Parting Company, Autumn 2000

In mid August 2000 the Czech Senate passed an amendment to the government's Geology Bill which will ban the use of cyanide heap leaching technology by the gold mining industry. Friends of the Earth in Czechoslovakia described the passing of the amendment as "the last nail to the coffin of the gold mining projects" in the country. 1

Cyanide heap leach technology involves spraying cyanide solution over heaps of ore and tapping the dissolved gold solution from the base of the heap. Heap leach technology became the main large scale technology in the 1980s for developing lower grade ore bodies and reprocessing old tailings dumps.

The amendment to ban cyanide heap leaching ban followed a strong campaign by local communities and Friends of the Earth against the Mokrsko project owned by Rio Tinto and the Kasperske Hory project owned by the US company TVX Gold.

The amendments gained support from the Senate as well as the Minister of Environment, Milos Kuzvart, who was the sponsor of the original bill. "The law marks the last step in several years long controversy over gold mining projects in the Czech Republic", Friends of the Earth mining campaigner, Vojtech Kotecky, said.

Friends of the Earth, "Czechs ban cyanide mining", Media Release, 10 August 2000

Rio Throws Diamond Project

The Diavik diamond project 300 kilometres north of Yellowknife in Canada's North West Territories, managed and majority owned by a Rio Tinto subsidiary, has been fined in court and is the centre of controversy over its water licences.

The project is a joint venture between Diavik Diamond Mines Inc. (DDMI), a Rio Tinto subsidiary with a 60% interest, and Toronto based Aber Diamond Mines Ltd.

In late July 2000 Diavik Diamond Mines (DDMI), was fined $3,000 after pleading guilty to proceeding with work on a quarry without having a final permit for the work. DDMI has also been criticised for its approach to obtaining regulatory approvals for water.

DDMI had a water licence, known as a Type B licence, that capped the amount of water the project could take for use for dust suppression. In September 1999 DDMI applied for a Type A licence which, as it allows much greater volumes of water to be extracted, has to go through a process of hearings and approval by the Minister for Indian Affairs.

At a meeting with the North West Territories (NWT) Water Board on 11 July to discuss the company's needs for a greater water volume it was suggested that company apply for an amendment to its Type B licence. It was a proposal that DDMI rejected.

Ten days later the President of DDMI, Stephen Prest, told a media conference that the company had suspended its mining operation and would be forced to stand down staff if the application for a Type A licence was not resolved within a month. "A Type B licence will not allow for the type of water consumption we need at this stage of the work at this site", he said. 2

The chairman of the NWT Water Board, Gordon Wray, was bemused by DDMI's claims. "This is a squeeze play", Wray told local media. 3 "The media has been brought in as the sort of operating arm. If the end of July was so critical to your planning, why did you (they) wait until July 23 to tell any of us?" he said.

"The company has been doing this since the beginning," Wray said. "The land-use permit, they were going to pull out. The water licensing hearings, they were going to pull out. This company has not understood there is a process they have to go through, they just seem to want to short-circuit it all the time", Wray said.

In mid-August the project was granted both an amended Type B licence and a Type A licence.

1 Dawn Ostrem, "Court fines Diavik $3,000: Company pleads guilty to land use violation", Northern News Services, 26 July 2000.

2 Mike W. Bryant, "Diavik uses up water quota", Northern News Services, 26 July 2000.

3 Mike W. Bryant, "Skirting the issue: Water board scolds Diavik's delay tactics", Northern News Services, 26 July 2000.