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A Battle to Hold Mining Company Accountable

Monday, 25 February 2019 13:48
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A Battle to Hold Mining Company Accountable

Mintails left behind a R460 million ‘environmental mess’

Saturday Star | 23 Feb 2019 | SHEREE BEGA

Picture1

MINTAILS, a gold mining company on the West Rand, has long been red-flagged for causing environmental damage at its operations. | BHEKIKHAYA MABASO African News Agency (ANA)

 

MARIETTE Liefferink toys absently with the faux gold necklace coiled tightly around her neck like a scarf.

“Perhaps, if people ask me, I can say we can all look pretty with imitation gold,” she says, flashing a smile.

The 65-year-old mining activist does not wear real gold – and she never will. The reason lies all around her here on the polluted gold fields of the West Rand.

Today, the chief executive of the Federation for a Sustainable Environment (FSE) is showing the R460 million environmental “mess” left behind by Mintails, a liquidated gold mining and tailings processing company listed on the Australian Stock Exchange.

She gestures to a cluster of unrehabilitated mine dumps on Main Reef Road. “At all their sites, there’s no access control, no stormwater and dust control or any other mitigation or management of the dumps and tailings storage facilities. This has created opportunities for zama zamas to conduct their mining operations.”

For the past 12 years, Liefferink’s quest has been to obtain “justice for communities, future generations and the mute receiving environment” affected by Mintails expansive operations stretching across Krugersdorp and Randfontein.

She has spent hundreds of hours compiling complaints and requests to authorities for investigations and enforcement, lodging Promotion of Access to Information Act requests and analysing water quality results.

The embattled firm applied for business rescue in October 2015, but was liquidated in September last year. It has an unfunded environmental liability of R485 million, but only around R25 million financial provision in its environmental rehabilitation funds.

The “delinquency”, argues Liefferink, is not only on the part of the firm and its directors but also the Department of Mineral Resources (DMR) and the Department of Water and Sanitation (DWS) for their non-enforcement of the National Environmental Management Act (NEMA), National Water Act and the Minerals and Petroleum Resources Development Act (MPRDA).

“The DMR, as well as the DWS, allowed Mintails to operate from 2012 to 2018 without a mining right, an approved environmental management programme report and financial provisions.”

While the DMR and DWS issued the company with several pre-directives and directives for non-compliance since 2013, these were not enforced.

“This resulted in this unfunded environmental liability of R460 million, clusters of open pits of 40m deep, partially reclaimed tailings storage facilities, unrehabilitated footprints and toxic and radioactive dams.”

Last week, the Legal Resources Centre (LRC), which represents the FSE, sent a final letter of demand to the DMR and DWS, to urgently intervene in addressing Mintails’ pollution. If the departments did not adequately respond by yesterday, the matter will head to court imminently.

The letter states that the DMR and DWS must enforce their directives as a matter of urgency and provide a date by when compliance must be achieved by the liquidators and directors.

“The DWS, the Mintails Group and their violations was an agenda item on every Wonderfonteinspruit catchment management forum meeting with minutes taken. No action was taken by DWS,” states Lucien Limacher, the acting regional director of the LRC, in the letter.

The letter demands that the DMR and the DWS must issue new directives to the liquidators and directors of Mintails to start remedial action and “contain the toxic sludge that is currently polluting and degrading the environment as a matter of urgency”. Further damage is allegedly being caused by continuing open pit mining.

The DMR “must take reasonable measures to remedy the situation” or apply to a competent court should the Mintails Group not comply or inadequately comply with the directives.

“Should the Mintails Group not comply with the directives, in terms of NEMA, the DMR (must) issue an ex parte application against the Mintails Group to attach and seize property and cover the expenses of the rehabilitation in terms of section 45 of the MPRDA.”

The letter also states how the DMR and the Commission and Intellectual Property Commission “must hold accountable the directors of Mintails for the rehabilitation infringements by bringing a delinquency application” under the Companies Act.

“The directors have grossly abused the position of director, intentionally or negligently, inflicted harm upon the company and the subsidiaries, acted in a manner that amounted to gross negligence and have repeatedly been personally subject to directives from the DMR and DWS.”

In November, a report by the Parliamentary portfolio committee on mineral resources stated how the DMR had failed to ensure Mintails had made the required provision to repair over R300m of environmental damage. The report was sparked by a probe into Mintails collapse by investigative environmental journalism unit, Oxpeckers.

“The committee is often confronted by instances of the devastation caused by careless mining where the DMR says it is a state liability because no one can be found to take responsibility.

“In the case of the Mintails operation, this mine went into business rescue in 2015, at a time when the mining company had an unfunded environmental liability of over R300m. It had saved barely R20m for all its responsibilities.”

The committee’s report noted how Mintails disputed its environmental liability, employing consultants who offered estimates far lower than those of the DMR.

The National Nuclear Regulator (NNR), which conducted a site visit in December as the waste had a “radioactive/nuclear element, according to the FSE, says an internal process is under way.

“You can rest assured that the NNR will play its regulatory role and discharge its responsibilities in accordance with its mandate regarding this matter,” it says.

Sputnik Ratau, spokesperson for the DWS, explains how it issued Mintails with a pre-directive in November 2017. “This required Mintails to cease the seepage of Lancaster Dam wall, clean historic spillages along the reclamation pipeline, rehabilitate the wetlands in the proximity of its tailing storage facility and address inadequate stormwater management.”

But the Mintails response to the pre-directive was “deemed unsatisfactory” by the DWS in a letter dated June 28 2018.” The firm then submitted a detailed implementation plan to curb the pollution to the DWS on July 2.

However, when Mintails was placed under provisional liquidation in August last year, this “derailed all the progress that was achieved through the pre-directive process”.

The DWS is now seeking legal advice internally. “Does the issued pre-directive and commitment made by Mintails carry over to the liquidators, directors and business rescue practitioner? Are the directors and business rescue practitioner legally obliged to comply to the issued pre-directive and implementation plan submitted by Mintails?

“Are the liquidators legally obligated to deal with operational issues such as a directive and pollution considering that they are appointed for a limited period to collect all the assets of the mine to settle the claims of its creditors and distribute any of the remainder of the assets to the shareholders of the mine.”

The DWS was previously advised in a similar case that it is not the duty of liquidators to manage the day to day business. “Their objective is to realise assets on behalf of creditors. As such, liquidators cannot be directed to manage pollution.”

Liefferink worries about impunity. “It would appear when a mining company is in business rescue or liquidation, then the directors and liquidators have no duty of care and simply walk away. The environment, future generations and communities must carry the impact, as in the case of Blyvoor and Aurora. That is totally contrary to the polluter pays principle.”

Ratau says the DWS would conduct a site investigation with the liquidators yesterday to “verify the allegations of pollution”.

The mandate of rehabilitation rests with the DMR. “However, DWS is engaging the DMR to ensure that water resources are protected.”

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SATURDAY STAR | 19 APRIL 2019, 7:41PM | SHEREE BEGA Picture:Yvette Descham On August 13 2013, Billy M heard gunshots at the gate of his house. He didn't know who fired the gun, and, worried that local traditional leadership might be involved, he didn't report the incident to the police. For the next five years, the community activist from Fuleni, a small rural village in KwaZulu-Natal bordering one of SA's oldest and largest wilderness areas, the Hluhluwe iMfolozi Park, continued to receive threats.  "We know our lives are in danger. This is part of the struggle," he says, simply. 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Picture: Shayne Robinson, Section 27 Authorities should address the environmental and health concerns related to mining "instead of harassing the activists voicing these concerns,” remarks Matome Kapa, attorney at the CER.The report starts with the high-profile murder of activist Sikhosiphi “Bazooka” Rhadebe, who was killed at his home after receiving anonymous death threats in 2016. Rhadebe was the chairperson of the Amadiba Crisis Committee (ACC), a community-based organisation formed in 2007 to oppose mining activity in Xolobeni in the Eastern Cape.  "Members of his community had been raising concerns that the titanium mine that Australian company Mineral Commodities Ltd proposed to develop on South Africa’s Wild Coast would displace the community and destroy their environment, traditions, and livelihoods. More than three years later, the police have not identified any suspects in his killing."Nonhle Mbuthuma, another Xolobeni community leader and spokesperson of the ACC, has also faced harassment and death threats from unidentified individuals. "I know I am on the hit list.… If I am dying for the truth, then I am dying for a good cause. I am not turning back," she says.But other mining areas have had experiences similar to that of Xolobeni. "While Bazooka’s murder and the threats against Nonhle have received domestic and international attention, many attacks on activists have gone unreported or unnoticed both within and outside the  country."This is, in part, because of "fear of retaliation for speaking out, and because police sometimes do not investigate the attacks", the authors found.The origin of these attacks or threats are often unknown. 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In some cases, government officials or representatives of companies deliberately drive and exploit  these community divisions, seeking to isolate and stigmatize those opposing the mine."The Minerals Council South Africa, which represents 77 mining companies, including some in the research areas, responded that it “is not aware of any threats or attacks against community rights defenders where (its) members operate”.The authors state that while the mining sector and the government emphasise how mining is essential for economic development, "they fail to acknowledge that mining comes at a high environmental and social cost, and often takes place without adequate consultation with,or consent of, local communities".The absence of effective government oversight means that mining activities have harmed the rights of communities across South Africa in various ways. 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"Although South African law requires the development of social and labour plans (SLPs) that establish binding commitments by mining companies to benefit communities and mine workers, CALS has documented significant flaws in the development and implementation of SLPs."Despite the environmental and social costs of mining, the government is not adequately enforcing relevant environmental standards and mining regulations throughout South Africa. The SAHRC has found that the Department of Mineral Resources (DMR) often fails to hold mining companies accountable, "imposing few or no consequences for unlawful activities and therefore shifting the costs of pollution to local communities."Compliance with regulatory obligations, as well as monitoring and enforcement of such responsibilities, remains a crucial concern in the context of mining activities," says the SAHRC, noting how the DMR and other governmental agencies often do not respond to complaints filed against mines by community members.The report's authors describe how the lack of government action and oversight has also helped make the mining industry one of the least transparent industries in South Africa. Information that communities require to understand the impacts of mines and to hold mining companies accountable for harmful activities is often not publicly available. "Such information includes environmental authorisations, environmental management programs, waste management licences, atmospheric emission licences, mining rights, mining work programmes, social and labour plans, or compliance and enforcement information."The only way to access such information is through a request under South Africa’s access to information law, a procedure that the World Health Organisation has called 'seriously flawed' and which the DMR regularly flouts. 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It recommended that South Africa provide a safe and favourable environment for the work of human rights defenders to promote and protect economic, social, and cultural rights, including by "ensuring that all reported cases of intimidation, harassment, and violence against human rights defenders are promptly and thoroughly investigated and the perpetrators are brought to justice". 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