Diggers & Dealers Annual Conference

Published by MAC on 2006-08-10

AT THIS week's Diggers & Dealers annual conference of the nation's leading mining companies, forum chairman Brian Hurley bashed the Government for not doing enough to rid the industry of time-consuming, resource-wasteful and downright frustrating "green tape" that hampered exploration and threatened Australia's way of life. Hurley's argument misses the point, which is that no one should have to live with a mine that causes environmental damage, in Australia or abroad, as the following case illustrates.

Villagers on Rapu-Rapu Island in the Philippines became alarmed when dead fish began appearing in their waterways. Their alarm quickly turned to fear and panic when Lafayette, an Australian Mining Company operating on the island, confirmed toxic metals from its operation had contaminated the island's rivers.

Lafayette's operation was eventually shut down after two cyanide-laden spills last year, but not before a poisonous slurry oozing into the waterways resulted in a huge number of dead fish and contaminated water, and robbed some communities of their livelihoods. Fish sales plummeted and 80 per cent of traders in the area were affected. What's more, shortly after the spills, people living within a 20-kilometre radius of the mine complained of unusual rashes and itchiness.

So, what happened at the mine to cause the spill? The Philippines Government assembled a panel of experts to investigate the disaster.

The two-month investigation concluded that Lafayette had started to extract copper and zinc without completing the construction of environmental protection measures necessary to safeguard the island's ecosystem. The commission recommended the closure of Lafayette's operations, a ban on mining in Rapu-Rapu and a review of the Philippines Mining Act, which allows for 100 per cent foreign ownership of local mines.

Australian mining companies, no matter where they operate, would do well to heed the call for them to uphold environmental and human rights standards. Failure to do so can threaten the livelihoods of local people and the environment. It can also hinder or even put a permanent end to mining operations for Australian companies - a point surely not lost on Hurley, who presumably wants to see Australian miners continue to operate to maximise profits.

Mining companies operate under a social licence. Governments allow them to operate provided they do so in ways that deliver a net benefit to the public. And, as the Lafayette case illustrates, a sure way to lose that social licence is to operate a mine using substandard means that would be unacceptable in Australia.

It only takes one shonky mining company to adopt an irresponsible approach for other Aussie companies to lose their own social licence. The best way for the mining sector as a whole to achieve profitability is to act with responsibility.

Meanwhile, the Philippines Government has thrown Lafayette a lifeline. Rather than rule out its mining operations, the Government gave Lafayette a 30-day test run to prove it could operate the mine within environmental standards.

But could it? Barely three weeks after the test run began, there was a third toxic spill at the mine, at the end of last month. Lafayette claims it was sabotage. But that's not the first time the company has cried foul. Previous spills at the mine were blamed on unidentified people. However, the independent investigation into those earlier spills condemned the company for not analysing mercury and other toxic heavy metals in the ore that it mines. So far, the mining company has been fined $265,000 for allowing toxic metals to leak into the waterways of Rapu-Rapu Island.

Australian mining companies must adhere to Australian environmental and human rights requirements when overseas. Here in Australia the public expects high standards. Do the people of Rapu-Rapu Island deserve less?

Shanta Martin is the mining ombudsman for Oxfam Australia.