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Mongolian Nomadic Herders Worry About Impact of Rio Tinto's Gold Mine

Posted by Puck Lo on September 24th, 2012
CorpWatch Blog
Father and daughter, resettled by Oyu Tolgoi. Photo by CEE Bankwatch Network. Used under Creative Commons license

Mongolian livestock herders are worried that a series of massive gold and copper mining projects will dry up scarce water reserves and exacerbate desertification in the delicate Gobi Desert when operations begin next year to tap one of the world’s largest copper and gold deposits.

A landlocked country of 2.8 million caught between China and Russia, Mongolia is home to the first "cowboys" - nomadic herdsman. Even today, two out of five people in Mongolia still make their living herding livestock, and the same number live in poverty.

After the fall of the Soviet Union, Mongolia’s major former trading partner, the government encouraged free market development and expansion of mining in the gold, copper and uranium-rich country, on the advice of the World Bank. Last year the country’s economy grew 17 percent from mining alone - faster than any other in the world and twice as fast as China.

Eurasia Capital, a Hong Kong-based investment bank, estimates that Mongolia sits on $1.3 trillion worth of untapped mineral assets. They predict that the country’s gross domestic product could swell from $5 billion to $30 billion by 2020, based on its mineral resources alone.

The biggest project to date - the $6 billion Oyu Tolgoi gold and copper mine (“Turquoise Hill” in Mongolian) - is now nearly ready to open. Located just 50 miles north of the Chinese border, it is expected to be one of the world’s three largest mines when it reaches full production in 2018. Two thirds of Oyu Tolgoi is owned by Canadian-owned Turquoise Hill (formerly Ivanhoe Mines), which in turn is majority-owned by Rio Tinto, the world’s largest private mining company, based in London.

“This is the biggest agreement in the history of the country by a magnitude of a thousand,” Jim Dwyer, executive director of the Business Council of Mongolia, told the Global Mail in February.

Indeed, even while under construction Oyu Tolgoi accounted for 30 percent of Mongolia’s current economy, according to the mine’s spokesperson. Already thousands of young people in their 20s and 30s have flocked to the capitol, Ulan Bator, seeking jobs working for Oyu Tolgoi. The noveaux rich spend time at the new Irish pubs near the Louis Vuitton store and watch Hummers drive by alongside Soviet-era buses.

“When international investors make big decisions to employ their scarce capital, cutting-edge technology, management expertise, and marketing prowess, they look for responsible partners,” Oyu Tolgoi’s Australian CEO Cameron McRae, said. “Partners like Rio Tinto prefer to invest in countries when the government takes the long view, as we do.”

But critics say that the large-scale mining operations have dire social and environmental costs.

“We don’t need money from mining,” Battsengel Lkhamdoorov, a 40-year-old former herder, told the New York Times. “What we need is water and land.”

Sukhgerel Dugersuren, head of Oyu Tolgoi Watch, a Mongolian non-governmental organization that keeps tabs on the mine, says the agreement with Rio Tinto is a bad deal for Mongolia. Dugersuren said that the investment agreement the government signed with Rio Tinto is unfair and that World Bank leadership pushed too hard for the Mongolian government to sign on. She told the Bank Information Center in Washington DC that the World Bank extended  "too much credit to Mongolia” in support of mining “without implementing compliance monitoring mechanisms or impact assessments.”

Today, the Mongolian government owns just 34 percent of the mine under the deal that was signed with Rio Tinto in 2009. Mongolian members of parliament are now pressuring the government to push the mining companies to renegotiate for a majority 51 percent share but the company has refused - noting that the agreement only allows for the state to negotiate for a larger share after the project has been in operation for 30 years - and even then no more than 50 percent.

Even worse, the London Mining Network alleges that the Mongolian government signed the agreement “before a technical and economic feasibility study was accepted by the Mongolian government, as prescribed by law." Additionally, the London Mining Network notes that the mining company has failed to show that there is enough water for the 30 to 60-year project.

This is despite the fact that mining industries consume the largest part of the country's annual water consumption, says The RiverMovements, a Mongolian environmental group which points out that Oyu Tolgoi will use approximately 243 gallons of water a second.

Meanwhile nomadic herders, who comprise 40 percent of the country’s population, will be forced to wander further to find water for their flocks, a 2011 United States Agency of International Development report said.

“(Oyu Tolgoi) does not understand the dynamics of herding and the need to follow the livestock to adequate pasture and water sources,” the report stated. “It is economically and psychologically difficult for herder families to move from their traditional land.”

Rio Tinto says it is committed to having a “zero impact on community water sources.”

“The water source for Oyu Tolgoi is the Gunii Hooloi aquifer - a deep, non-drinkable water source that is separate from the shallow water sources used by households and animals,” the company states on its website. “Oyu Tolgoi is only allowed to use approximately 20 per cent of the water from Gunii Hooloi, so the aquifer can never be exhausted. We do not need to take water from any other source.”

But many local herders are skeptical.

"When we come to the well, we can see the level of the well water is 8 inches lower than it used to be," Mijiddorj Ayur, a 76-year-old who herds his camels near Oyu Tolgoi, told National Public Radio.

Oyu Tolgoi Watch believes that the country should invest instead in sustainable economic development that bolsters traditional livelihoods like cashmere production and organic beef ranching.

“If the same amount of credit was made available to developing world standards products and services from these sectors Mongolia could sit on its wealth until there is dire need to disturb the earth,” Dugersuren said. “Unfortunately, this does not coincide with the interest of the World Bank to support Western industries to extract and sell minerals to China.”

The government has made a major effort to ban mining in environmentally sensitive areas but ironically this has the heaviest economic impact on the 100,000 Mongolian self-employed miners rather than on Rio Tinto. By contrast, Oyu Tolgoi will employ about 3,500 workers when it is fully operational, according to the World Bank.


Cameroon Palm Oil Plantation Withdraws Sustainability Application

Posted by Pratap Chatterjee on September 6th, 2012
CorpWatch Blog
A bulldozer clears natural forest for the Fabe SGSOC oil palm nursery. Photo: Jan-Joseph Stok / Greenpeace.

A subsidiary of Herakles Capital, a New York based investment firm, has decided to cancel its application to join the Roundtable on Sustainable Palm Oil (RSPO) after environmental groups alleged that its 73,086 hectare project in southwestern Cameroon would threaten the sustainability of the local community.

In 2009, the SG Sustainable Oils Cameroon, Ltd. (SGSOC), which is wholly owned by Herakles Capital, acquired a 99 year lease to land in Ndian and Kupe-Manenguba divisions where it drew up plans for a $350 million palm oil plantation. (Herakles Capital has several other investments in Africa such as the Bujagali dam in Uganda, the Boke Alumina Project in the Republic of Guinea and an East African undersea fiber-optic project.)

“From its very name, American-owned SG Sustainable Oils Cameroon, Ltd. (SGSOC) presents a pro-environment, pro-resources image,” writes Frederic Mousseau, policy director of the Oakland Institute in California in a new report released this week. “(But it) is also part of a strategy to deceive the public into believing that there is logic to cutting down rainforests to make room for palm oil plantations.”

SGSOC has gone to great lengths to convince the public that it is socially responsible. “Our project, should it proceed, will be a big project with big impacts – environmentally and socially,” Herakles CEO Bruce Wrobel wrote to the Oakland Institute in July 2011. “The big question – and the real story – is whether it ends up strongly positive or strongly negative. I couldn’t be more convinced that this will be an amazingly positive story for the people within our impact area.”

In addition to Herakles, Wrobel operates a non-profit dedicated to poverty reduction named “All for Africa” that boasts board members like Nigerian-American actor Gbenga Akinnagbe who shot to fame in The Wire, a U.S. TV series, and the film: The Taking of Pelham 123.

And SGSOC also applied to join the international Round Table on Sustainable Palm Oil (RSPO), which has signed up 779 members and associates including almost every major industry player in the world, in an effort to burnish its social responsibility credentials.

Indeed RSPO was created in 2004 to address the numerous clashes over palm plantations around the world with the help of non-government organizations such as the World Wildlife Fund which helped set up the organization.
But the palm oil industry – which produces 50 million tons of edible oils and biofuels a year - remains deeply controversial.

As CorpWatch writer Melody Kemp noted in her recent article for us “Green Deserts: The Palm Oil Conflict” the plantation companies make money in two ways: First they clear cut and sell the existing high-value trees, burning the residue. The haze from those forest fires has interrupted regional air traffic and caused severe respiratory illnesses in countries like Indonesia, Malaysia as well as Singapore. Then the companies plant the spiky oil palms trees, creating vast, eerily silent monoculture plantations.

Activists have sparked a raging debate over the industry, faulting palm oil for contributing significantly to carbon dioxide and methane emissions, the loss of biodiversity and precious carbon sequestering forests, land subsidence, poverty, and for exacerbating starvation resulting from land appropriation.

The very same problems have been predicted in an Environmental and Social Impact Assessment (ESIA) conducted by SGSOC itself. The company assessment suggested that the negative impact of the plantation on livelihoods will be “major” and “long-term.”

Nor is the Herakles investment the most efficient way to support the local economy, according to a report by on the SGSOC deal by two Cameroonian NGOs, the Centre for Environment and Development (CED) and Réseau de Lutte contre la Faim (RELUFA). The groups calculated that the government of Cameroon could generate 13 times more employment and significantly larger tax revenue if it were to require local bread-makers to use 20 percent locally produced flour (derived from sweet potatoes, corn or cassava), using just 15,000 hectares of land.

Local farmers and politicians are especially skeptical of SGSOC because palm oil plantations are not new to the region. Beginning in 1927, companies like Pamol have operated similar projects for decades. “Plantation jobs have always been modern day slavery,” says Joshua Osih of the Social Democratic Front, Cameroon’s main opposition party, in an interview for the film “The Herakles Debacle” just released by the Oakland Institute. “We’ve seen a lot of industrial plantations develop around this area and nothing, absolutely nothing, has happened positively to the population.”

“Everybody here is self employed,” Okie Bonaventure Ekoko, a cocoa farmer from Mboko village told the film maker Franck Bieleu. “There is no advantages that the people here will have (from Herakles investments). We don’t need them, we are fine.”

“And if they come and say they want to take this land from us, we are not ready for it,” says Esoh Sylvanus Asui, a farmer from Bombe Konye village. “We will fight and we will die for our land.”

In May 2011, some 50 local and international environmental and community groups wrote a letter to Wrobel expressing concern. In March 2012 a number of the same groups lodged a formal complaint against Herakles with the RSPO alleging that Herakles' project violated Cameroonian laws and noted that it "would disrupt the ecological landscape and migration routes of protected species." Meanwhile local farmers have begun to organize against the project. On June 6, 2012, villagers from Fabe and Toko held a protest against the plantation during the visit of the local governor.

On August 24 2012, Herakles withdrew its application to the RSPO.

“The RSPO regrets this withdrawal of membership by Herakles Farms,” the organization said in a brief statement posted to its website. “This action pre-empts recommendations from the RSPO Complaints Panel to further verify the allegations made by the complainants.”

The company did not respond to requests for comment from the media.

Grupo San Jose Linked to Bulldozing of Land of Paraguayan Uncontacted Tribe

Posted by Pratap Chatterjee on August 27th, 2012
CorpWatch Blog
Ayoreo woman. Photo: Survival International

Grupo San Jose, a Spanish construction company, has been accused of bulldozing the forest home of the Ayoreo, one of the last uncontacted tribes outside the Amazon. The indigenous community lives in the Chaco forests, a semi-arid zone in northern Paraguay not too far from the borders with Brazil and Bolivia.

In late July, Paraguayan forestry officials caught workers for Carlos Casado SA “bulldozing forest, constructing buildings and reservoirs, and putting up wire fencing” on land that the Totobiegosode – a sub-group of the Ayoreo - are known to inhabit. The discovery was confirmed by a letter from the Paraguayan ministry of environment sent to Organizacion Payipie Ichadie Totobiegosode (OPIT)

Carlos Casado SA is a ranching subsidiary of Grupo San Jose. The president of both Carlos Casodo and Grupo San Jose is Jacinto Rey González, who is also the controlling shareholder of Grupo San Jose.

“It’s shocking to discover that one of Spain’s biggest companies is involved in such scandalous behavior. Perhaps they thought that as this is happening in a far-off corner of South America, no-one would notice,” Stephen Corry, director of Survival International, a UK-based NGO, said in a press release. “But if they continue, they will be directly responsible for the destruction of the Ayoreo’s heartland – in flagrant violation of Paraguayan and international laws.”

The Ayoreo are nomads who hunt wild pigs and large tortoises. They live in small communities of three to four families and shun the outside world. First contact was established by Mennonite farmers in the 1940s and 1950s, followed by the New Tribes Mission - a Florida-based evangelical group that attempts to spread the Bible by translating it to into other languages – who sponsored manhunts to track down the Ayoreo in 1979 and 1986.

Almost 70 years later, some of the members of the tribe have managed to elude all contact with others and environmentalists argue that this isolation needs to be maintained. One of the major reasons is that these tribes lack immunity to illnesses and diseases that are common elsewhere, and could die from exposure. 

This isolation has been threatened in recent years as three Brazilian companies have started clearing land in the area to set up ranches: BBC SA, River Plate SA and Yaguarete Porá SA. Survival was able to catch two of the companies doing illegal logging, using satellite imagery.

Guyra, an environmental group in Asunción, estimates that some 1.3 million acres of Chaco forest have been cleared in the last two years, for cattle ranches. http://www.guyra.org.py/index.php/reportes-de-cambios-de-uso-de-la-tierra-del-gran-chaco-americano Lucas Bessaire, a U.S. anthropologist told the New York Times that the rate of deforestation was so rapid that even during the day, the sky turns “twilight grey” from the forest fires. “One wakes with the taste of ashes and a thin film of white on the tongue,” he said.

Today the Mennonites farmers and Brazilian ranchers have coverted vast swathes of the Chaco region. Displaced Ayoreo live in poverty outside the new ranching boomtowns, sleeping under plastic bag tents under the trees.

“We are witnessing ethnocide in action,” Gladys Casaccia and Jorge Vera of Gente, Ambiente y Territorio (GAT), a Paraguayan NGO that supports environmental initiatives for the indigenous people of the Chaco. “This crime is a human tragedy, an embarrassment for Paraguay in the eyes of the world – and it will only stop if those responsible are caught and punished.”

Paraguay already has the sad distinction of being a deforestation champion,” José Luis Casaccia, a former environment minister, told the New York Times. “If we continue with this insanity, nearly all of the Chaco’s forests could be destroyed within 30 years.”

Turmoil at South Africa’s Platinum Mines

Posted by Pratap Chatterjee on August 23rd, 2012
CorpWatch Blog
Cyril Ramaphosa photo courtesy Mining Weekly video. Rustenberg platinum processing plant courtesy bbcworldservice. Used under Creative Commons license

A third wildcat strike this year has closed yet another South African platinum mine less than a week after the police opened fire and killed 34 miners at the Lonmin mine north of Johannesburg. The latest to lay down tools are a thousand workers at the Royal Bafokeng Platinum Mine at Rasimone this Wednesday.

The strikes have hit the global supply of platinum, which is mostly used by the car manufacturing industry to make catalytic converters. Some 80 percent of the world’s supply of the precious metal is mined in South Africa.

Clashes between South Africa’s powerful mining companies and the government are only part of the story. A battle to win membership between two rival unions – the older establishment affiliated National Union of Mineworkers (NUM) and the newer more radical Association of Mineworkers and Construction Union (AMCU) – is also reported to be a major factor in the violence.

NUM - which was founded by Cyril Ramaphosa in 1982 – was deeply involved in rallying black mine workers against apartheid. AMCU was created in 1998 by Joseph Mathunjwa who left the NUM after he fell out with Gwede Mantashe, then general secretary of the older union.

Today Mantashe has become the right hand man of Jacob Zuma, the president of South Africa and Ramaphosa has become a powerful and wealthy businessman. Last year Ramaphosa took over the franchise for McDonald’s in South Africa. He also serves on the board of Lonmin, the UK-based platinum mining company where workers were killed last week.

But while the NUM’s former leaders have become powerful actors in post-apartheid South Africa, the union has started to lose members. “The National Union of Mineworkers doesn’t care about the workers,” Thabo Moerane, a Lonmin supervisor told Bloomberg. “It is eating with management. We’ve been trying to get a decent salary increase since 2007. That is why we wanted to join AMCU.”

AMCU, which has grown to about a tenth of the size of NUM with 30,000 members nationally, has also attracted its own share of controversy. “Its leaders call themselves devout Christians and say life is sacred,” wrote Reuters recently. “But its supporters march with spears, machetes and clubs and anoint themselves with magic potions to ward off police bullets.”

Meanwhile, local anger at the mining companies has been brewing for a while. “Lonmin has done nothing for the local community. They take our platinum and enrich themselves but where is our royalty money going? We don't have tar roads and our youth are unemployed,” a woman worker told the BBC. “They cut off our water supply every day during the day. The water comes back only late at night. The water stinks and we have to buy purified water.”

The first strike, early this year, was in Rustenberg at the world’s largest platinum mine run by Impala Platinum Holdings. Three workers were killed in clashes between the unions. Then on August 10, some 3,000 Lonmin rock drill operators went on strike at the Marikana mining complex to ask for a pay raise to 12,500 rand ($1,500) a month. AMCU, which represents 5,000 workers out of a total workforce of 28,000 was in favor of the strike. NUM which represents some 12,000 workers at Lonmin did not back the strike. (Frans Baleni, NUM’s new general secretary, is paid 105,000 rand or $12,600 a month)

Over the next week, violent attacks and clashes resulted in ten deaths, including two police officers and at least one worker who was hacked to death on his way to work.

Then on August 16, the police claim they came under attack from workers armed with guns, spears and machetes. “Police had no option but to open fire,” police commissioner Riah Phiyega said. “This is a dark moment for the country.”

The police killed 34 people and injured another 78. The deaths caused shockwaves to roll through South Africa, where it brought back memories of the apartheid era shootings of protestors. Lonmin said it would not insist that workers return to work this week and Zuma came to meet with the workers Wednesday.

Workers feel that (violence) adds both positive and negative value,” Crispen Chinguno, a sociologist at the University of Witwaterstrand who conducted research among the platinum workers, told the Mail & Guardian newspaper. "At Implats, where workers were also demanding a salary adjustment (of 9,000 rand) outside of a bargaining agreement, they ended up getting more than 8,000 rand. The strike was illegal, some were dismissed, but most of them got their jobs back. From that perspective, the workers feel the use of violence is working for them. The negative aspects are some job losses, injuries and death."

Others say the killings reflect the reality of the new South Africa. “The story of the Marikana mine shootings is that of a trade union that cosied up to big business; of an upstart and populist new union that exploited real frustration to establish itself; and of police failure,” writes Justice Malala, founding editor of South Africa's ThisDay newspaper, in the Guardian. “It is a story which exposes South Africa's structural weaknesses too: we are one of the world's top two most unequal societies (with Brazil). Poverty, inequality and unemployment lie at the heart of the shootings this week.”

Chevron Face Opposition Over Eastern Europe Fracking Plans

Posted by Pratap Chatterjee on August 6th, 2012
CorpWatch Blog
Anti-fracking poster in Bulgaria. Photo: Пенка ГенадиеваБългария

Chevron - the Northern California-based oil and gas company – has been quietly acquiring rights to drill for natural gas in Eastern Europe using “fracking” technology – a controversial technique. However, grassroots opposition in Bulgaria and Romania has thwarted the companies plans so far.

An interview with Ian MacDonald, vice-president of Chevron Europe, Eurasia and Middle East, in the Financial Times suggests that the company is getting ready for what it believes is the next fossil fuel extraction boom in the region.

“For years, it has been snapping up exploration acreage along a geological faultline that stretches from the Baltic to the Black Sea,” writes Guy Chazan. “A crucial piece of its jigsaw fell into place in May when it won the right to negotiate a big shale gas contract in Ukraine. That left it with an almost continuous arc of concessions stretching from Bulgaria in the south-east to Poland in the north. The blocks in Romania alone cover 2,700sq km.”

But the company faces an uphill political battle to the technology that has been blamed for contaminating local water supplies and even causing earthquakes. Bulgaria banned fracking in January after a major protest against Chevron’s plans to drill in Dobrudja, the most fertile farm region in the country in January.

Chevron is also running into fierce opposition in Romania which has a moratorium on the technology. The company has licenses in the north-east and south-east Dobrogea region near the southern border with Bulgaria as well as for the in north-eastern Romania near the border with Moldova.

“We examined the Chevron contract and… encountered suspicious secrecy at all levels,” says Nicolae Rotaru of Civic Platform in Romania. “We want a law to be worked out to regulate the drilling for shale gas in Romania … It is dangerous for human life.”

Others pointed out that the drilling would not even benefit the local people financially. “These royalties are so tiny that they cost almost nothing, the private operators who profit from the exploitation and give peanuts to the state,” wrote Ilie Serbanescu in “Romania Libera”

The Czech republic is also considering a ban.

Western European countries have been fighting fracking too. France banned fracking last July after environmentalists and wine producers raised alarms about water pollution. Fracking was also recently briefly banned in the UK.

Why the opposition to fracking? Greenpeace explains here: “To access these reserves, fluid is pumped down a drilled channel (well) into the gas-bearing rock at very high pressures. This causes the rock to fracture, creating fissures and cracks through which the gas can 'escape'. The fracturing liquid generally consists of mainly water, mixed with sand and chemicals. Numerous different chemical agents are used, many of which are flagged as dangerous to humans and the environment (carcinogens, acute toxins).

“The fracturing of a single well requires a huge volume of water: around 9,000 - 29,000 m3 (9 -29 million litres). Chemicals make up about 2% of the fracturing liquid, i.e. about 180,000 – 580,000 litres. Only 15 – 80% of the injected fluid is recovered, meaning that the rest remains underground, where it is a source of contamination to water aquifers.”

The contamination has shown up in unusual place. For example communities in the U.S. have seen tap water catch on fire in fracking areas. (Watch this YouTube video and this one from Time magazine)

Fracking can also dramatically increase the likelihood of earthquakes, according to recent research in Youngstown, Ohio, where residents were hit last Christmas Eve and again on New Year's Eve.

A new study from Cliff Frohlich, a seismologist at the University of Texas, Austin, just published in the Proceedings of the National Academy of Sciences, shows a high degree of correlation between local earthquakes and fracking. “Beginning in 2001, the average number of earthquakes occurring per year of magnitude 3 or greater increased significantly, culminating in a six-fold increase in 2011 over 20th century levels,” Frohlich wrote. “This suggests injection-triggered earthquakes are more common than is generally recognized.”

To learn more about the dangers of fracking, check out the film Gasland and the Drilling Down series in the New York Times.

Congo Copper Mine Deals Questioned

Posted by Pratap Chatterjee on August 2nd, 2012
CorpWatch Blog
Women copper miners in the Congo. Photo: FairPhone. Used under Creative Commons license.

Eurasian Natural Resources Corporation (ENRC), a global mining company that got its start in Kazakhstan, has won a new $101.5 million license to dig for copper at the Frontier mine in the Democratic Republic of Congo. The company has been criticized by Global Witness for its purchases of rights from offshore companies connected to Dan Gertler, a controversial Israeli diamond merchant. http://www.globalwitness.org/library/possible-new-enrc-deal-raises-fresh-corruption-risks

“The Congolese state has foregone billions of dollars in revenues by secretly selling off its assets on the cheap to offshore companies,” Daniel Balint-Kurti, campaigner for the Democratic Republic of Congo at Global Witness said in a press release issued last month. “With so much at stake in one of the poorest countries on the planet, ENRC must do the right thing and shed full light on its dealings.”

Per-capita income in the Congo is under $300 a year and experts at the Carter Centre, which was founded by former US president Jimmy Carter, say there is a reason. "In a mining sector defined by irregularities and mismanagement, large industrial mining projects can earn huge profits for investors and government officials,” Sam Jones, associate director of the centre's human rights program, told the Guardian. “(L)ittle revenue finds its way back into desperately impoverished Congolese communities for schools, healthcare, or other social services.”

The Frontier copper mine is located near the town of Sakania in the Congo, about a mile from the Zambian border. It is located in the copper belt that straddles the border of the two countries that has been exploited commercially from the days of Belgian colonization to this day. Indeed the profits from the Union Minière du Haut Katanga, the original mining company in the region, was a major source of wealth for Belgium at the beginning of the 20th century.

First Quantum, a Canadian company, acquired the rights to mine for copper at Frontier in 2001 but was forced to turn it over to Sodimco, a state owned company in 2010 by the Congolese government. The licences were then sold to Fortune Ahead, a Hong Kong shell company. Meanwhile First Quantum filed multiple legal claims demanding $4 billion in compensation for Frontier and other assets nationalized by the Congolese government.

In January this year First Quantum agreed to turn over all its prior mineral rights to ENRC for $1.25 billion. ENRC had already bought rights to the giant Kolwezi tailings project for $175 million and purchased CAMEC, yet another Congolese company that owned a half share in the SMKK copper and cobalt mine.

But exactly who paid whom how much for mining rights in the Congo is up for debate. “ENRC’s purchase of its stake in Kolwezi was structured through a deal between itself and at least seven companies registered in the British Virgin Islands, all connected to Dan Gertler,” states a Global Witness fact sheet. “When ENRC bought the remaining 50 per cent stake in SMKK, it purchased it from another British Virgin Islands company linked to Mr Gertler. Even ENRC’s acquisition of CAMEC involved sale purchase agreements with several offshore companies linked to Dan Gertler which held shares in CAMEC.”

Gertler, an Israeli diamond merchant, has been doing business in Congo for over a decade, working first with Laurent-Désiré Kabila, the former president of the Congo, and now with his son, Joseph Kabila, the current president.

“The nature of these deals raises serious questions about whether corrupt Congolese officials could be benefitting from Congo’s considerable mineral wealth at the expense of the Congolese people,” says Balint-Kurti. “Global Witness has been calling for ENRC to publish the full results of an external audit into its dealings in Congo, conducted by the law firm Dechert.”

It is certainly not the first time Gertler and the Kabila clan have been linked. A lawsuit filed in Israel by Yossi Kamisa, a former Israeli fighter who worked for Gertler, says that the diamond tycoon had offered the elder Kabila military aid to the Congolese army in 2000.

“At the time, the Second Congo War (1998-2003) was raging - one of the most brutal conflicts in the history of the African continent, involving eight countries, dozens of guerrilla organizations and a horrific human toll that included large-scale rape and even cannibalism,” write Gidi Weitz, Uri Blau and Yotam Feldman in Haaretz newspaper. “This did not deter Gertler from realizing his plan to penetrate the lucrative diamond market in the DRC.”

Kamisa’s lawsuit charges that he “witnessed Gertler's method of operation, involving paying considerable sums of money as bribery to different individuals in the Congo government ... all in order to pave the way to a meeting with the president of Congo and to improve the terms of the future agreement that was to be struck between him and the state.”

Gertler denied these allegations, calling them vengeful and baseless, says the newspaper.

Malaysian Water Company Claims To Have Run Dry

Posted by Pratap Chatterjee on August 1st, 2012
CorpWatch Blog
Giant Syabas tap visible from the highway. Photo by suanie. Used under Creative Commons license.

Syabas, a private water company in Malaysia, has threatened to start water rationing in the state of Selangor after claiming that it had almost no water reserves left. The local government has called foul and critics claim that the threat is a ploy to win more lucrative contracts and to favor a rival political party.

“Here, we have a corporation holding a state government and public to ransom,” Charles Santiago, the coordinator of the Coalition Against Water Privatisation who is also a local member of parliament, told Free Malaysia Today. “The truth is not coming out. They have vested interest to overthrow the state.”

Selangor is the richest and most populous state in Malaysia with over seven million inhabitants and many of the country’s key industries in the area surrounding the national capital of Kuala Lumpur. It is governed by Pakatan Rakyat (PR) parties, an opposition coalition.

Syabas (which is short for Syarikat Bekalan Air Selangor) has a monopoly on providing water to Selangor. The company won a 30 year contract to provide water in December 2004 when the ruling Barisan National coalition privatized the state water supply.

Rozali Ismail, the treasurer for the United Malays National Organisation (UMNO) party in Selangor, owns 40 percent of Puncak Niaga Berhad, which in turns owns 70 percent of Syabas. UMNO is one of the key members of Barisan National.

Syabas is now lobbying heavily to raise rates for water but the Selangor government is insisting that the company first reduce the rate of “non-revenue water” which amounts to 30 percent of treated water.

Another option is the construction of a new RM3.6 billion ($1.15 billion) Langat 2 water treatment plant which is also likely to benefit Syabas and its affiliates.

“From what I understand from my industry sources, Umno boys are getting a lot of the contracts,” says Santiago. “I am talking about contracts for things like laying the pipes to others. Industry sources also tell me that Puncak Niaga is also getting the contract to operate and manage this.”

Tony Pua, another opposition politician, says that Barisan National wants to use the water issue as a way to prove that the state is being mismanaged. "They want to influence the course of the elections. They have a monopoly over water resources and are holding the people to ransom," Pua told Reuters.

“(I)n Selangor, the private concession companies chosen to treat and distribute water were not skilled nor experienced in the water services industry,” Khalid Ibrahim, the chief minister of Selangor, told the Sixth World Water Forum in Marseille, France, in March. “There should have been specific and detailed clauses providing penalties for the companies’ failure to comply with conditions. In our case, the agreement was so flawed that when the distributor experienced financial difficulties, the government eventually underwrote the companies’ debts.”

Others say that the idea that water privatization will serve the public better is simply untrue. “Proponents of privatization consistently argue that it saves costs due to competitive pressures private providers face to be more efficient,” writes Mildred E. Warner for the Trans National Institute in the Hague. Yet the reality is quite different. “The majority of the studies (11) found no difference in costs between public and private production,” she adds.

For example, Manila Water and Maynilad, two private corporations have run the water supply of eastern and western Manila since 1997. “Since then, water prices have soared, with increases between 450% - 850% for residents of each zone,” writes Corporate Accountability International. “Quality has suffered, with severe public health consequences, and the much-needed infrastructure investment which was used to justify the privatization has failed to materialize.”

The same was true in Jakarta where PT PAM Lyonnaise Jaya (Palyja) manages the west part of the city and PT Aetra Air Jakarta (Aetra) manages the east part. (Palyja’s major shareholder is Suez Environment, a French water company while Aetra is currently owned by Acuatico Ltd, a company based in Singapore)

“Citizens in Jakarta are suffering from unimproved services, high prices, bad quality of water and environmental deterioration,” writes Irfan Zamzami of the Amrta Institute for Water Literacy.  Zamzami predicts that the city will soon owe the companies 18.2 trillion rupiah. ($2.04 billion). “(W)ater service should be re-municipalized. This is a global trend and needs international solidarity to prevent citizens of the world from a privatized and inaccessible water service.”

Fracking Billionaire Faces Shareholder Anger

Posted by Pratap Chatterjee on June 8th, 2012
CorpWatch Blog
Photo: Gasland still. From the film by Josh Fox.

Aubrey McClendon, the founder and CEO of Oklahoma-based Chesapeake Energy, who championed natural gas to the extent of paying environmental groups to oppose coal, is facing angry shareholders for his profligate ways. Chesapeake is one of the leading users of fracking - an environmentally questionable method of extracting natural gas by injecting fluids underground at high pressure.

Chesapeake Energy, a 23-year old oil and gas company with 2011 sales of $11.64 billion, has bought up rights to drill on millions of acres of land in the U.S. This past March Rolling Stone magazine described the company thus: “It’s not only toxic – it’s driven by a right-wing billionaire who profits more from flipping land than drilling for gas,” wrote Jeff Goodell. “McClendon's primary goal is not to solve America's energy problems, but to build a pipeline directly from your wallet into his.”

McClendon aggressively promoted natural gas as part of the solution to climate change. He gave over $25 million to the Sierra Club’s Beyond Coal campaign and in return former executive director Carl Pope even accompanied him to speak out in favor of natural gas. (The Sierra Club’s new director, Michael Brune, has returned the remaining money)

But in the last four years, the company’s share price has dropped from almost $67 in June 2008 to about $18 now because of the crash in natural gas prices as well as the company heavy debt load. Shareholders have forced McClendon to resign as chair and this Friday, they voted out a number of individuals that he appointed to the board of directors.

Well blow-outs and water contamination from fracking haven’t helped the company’s image or share prices either. Alarming incidents like tap water catching on fire started to bring national attention to the environmental impact of fracking in recent years. By 2011, even the New York Times started to investigate the matter. (CorpWatch raised these questions in 2005 in a partnership with the Oil and Gas Accountability Project)

Fracking uses a mix of water, sand and a variety of chemicals, many of which are dangerous to humans and the environment. A study by the U.S. Congress estimated that out of 2,500 hydraulic fracturing products "(m)ore than 650 of these products contained chemicals that are known or possible human carcinogens, regulated under the Safe Drinking Water Act, or listed as hazardous air pollutants.”

Then there is the problem of waste waters. "Since there were no laws covering the disposal of this stuff at first, they (fracking companies) just dumped it into rivers or hauled it off to sewage plants to be 'treated,' which they knew didn't work," Deborah Goldberg, a lawyer at Earthjustice, told Rolling Stone. "They just wanted to get rid of the stuff as quickly and as cheaply as possible."

McClendon also brought attention to his company by funding right-wing causes like the Swift Boat attacks against John Kerry in 2004 and contributing more than $500,000 to stop gay marriage.

The latest scandal to entwine McClendon are his spendthrift ways. He shot to fame when he paid himself $112 million in 2008. Now Reuters has uncovered documents on how McClendon fused his personal expenses with that of the company.

“In 2010, Chesapeake employees spent more than 15,000 hours working on McClendon's personal projects at a cost of about $3 million,” write John Shiffman, Anna Driver and Brian Grow. The journalists report that McClendon arranged for over $1.5 billion in personal loans using his interest in company-owned wells as collateral. He bought a house on Bermuda's so-called billionaire's row, which includes houses purchased by Michael Bloomberg, Ross Perot and Silvio Berlusconi.

He was generous with shareholder’s money too. “On one flight, nine friends of McClendon's wife took a Chesapeake-leased jet to Bermuda without any McClendons aboard,” Reuters reports.

Small wonder that Forbes magaine once called him “America’s Most Reckless Billionaire.” Today, it's a bit hard to shed a tear for his plunging fortunes.

Ikea Furniture Made From Ancient Russian Trees

Posted by Pratap Chatterjee on May 31st, 2012
CorpWatch Blog
Swedwood pine lumber from Karelia. Age range approx. 200-600 years old. Photo: Protect the Forest Sweden.

Kalevala, a 19th century epic poem from Finland, is often considered the heart of the Finnish national identity. It was inspired by traditional verses from the ancient forests on the border of central Finland and Russia. Today some of the 600 year old trees around the Kalevala national park are being chopped up to make cheap furniture for Ikea, the Swedish home furnishing chain, according to activists.

Ikea, which is based in Delft, Netherlands, sells €23.5 billion ($30 billion) worth of goods every year from shelves to entire kitchens through its 300 shops around the world. Wood is used in roughly 60 percent of the products that it stocks – according to IPS news agency - and one of the company’s slogans is: "We Love Wood"

Critics are now questioning what this love for wood really represents.

In 2010 and 2011 activists from Protect the Forest Sweden took photos of lumber being hauled out of high conservation value forests just outside Kalevala national park in Russia by a company named Swedwood Karelia.

Protect the Forest immediately sent a letter of complaint to Nikolay Tochilov, the director of NEPCon, a Danish NGO that helps monitor sustainable forestry projects for Ikea. “Swedwood Karelia and their owner Ikea … state that they do not log primeval forests and that they do not cut hundred of years old trees,” wrote Viktor Säfve and Daniel Rutschman of Protect the Forest in a September 21, 2011 letter. “They … are clearly misleading their customers through marketing and through media, stating that their forestry is ecologically, socially and economically sustainable.”

Just 10 percent of the ancient old-growth forests remain in Karelia, according to the forest department of SPOK, the Karelia Regional Nature Conservancy, a Russian NGO. Swedish public service television recently estimated that Swedwood is further depleting that stock by cutting down about 1,400 acres of forest a year.

Protect the Forest say that the Kalevala forests hosts a number of red-list species, notably a number of lichen and fungi such as Antrodia crassa and Antrodia infirma (fungi), Bryoria Fremontii (black tree lichen), Hydnellum gracilipes (tooth fungus) and , Lobaria Pulmonaria (lungwort).

Earlier this week the forest activists launched a campaign against the company. "During our field visits to Russian Karelia, we have documented the reality of IKEA's forestry, and it's a far cry from the fine words in their advertising," Säfve wrote in the press release. "You must immediately stop logging old-growth forests, and you must stop lying! Those are two of the demands we make of IKEA."

“We believe the future of forestry in Russia lies in sustainably managing the vast areas of secondary forests – not in destroying the last intact areas of primeval forests,” Säfve and Rutschman wrote. “There are excellent conditions in Karelia to implement selective cutting methods in unmanaged, naturally regenerated secondary forests.”

Ikea disputes the charges. "Swedwood has played an important role in the advancement of forestry in Karelia. Our goal is to develop and improve forest management," Anders Hildeman, forest manager at Ikea told IPS. “We will continue to work according to the principles that we agreed on together with Russian environmental organisations like SPOK.

Repsol Sues Argentina for $10 Billion Over YPF Nationalization

Posted by Carmelo Ruiz-Marrero on May 18th, 2012
CorpWatch Blog
Cordoban youth poster supporting the takeover of YPF. Photo: Chupacabras. Used under Creative Commons license

Repsol, a multinational based in Spain, has brought a class action lawsuit in New York courts against the Argentine government for the re-nationalization of YPF, the former Argentine state oil company. The company has also lodged a complaint with the World Bank's International Center for Settlement of Investment Disputes (ICSID).

President Cristina Fernández de Kirchner of Argentina signed a bill on May 4 seizing 51 percent of the company’s shares after over 80 percent of legislators in both the lower and upper houses of parliament voted in favor. Respol, which owned 57 percent of YPF, wants $10.5 billion in compensation although it may find it hard to collect since Buenos Aires has ignored previous ICSID fines.

"When corporate interests are not aligned with national interests, when companies are concerned only with profits, that's when economies fail, which is what happened globally in 2008 and what happened to Argentina in 2001," Fernández said in a speech on May 3 to explain her motives in pushing for the takeover alleging that Repsol under-invested in the company and paid out excessive dividends, essentially stripping out the value.

Fernández’s move has rattled international financial markets but drawn extensive praise from some popular movements.

The Battle Against Privatization in South America


In the 1970s, most oil companies in South America were state owned, just like most utilities. Following the debt crisis of the 1980s, governments in the region were persuaded by the World Bank and the International Monetary Fund to privatize many of these state assets. A number of European multinationals – like Repsol of Spain and Suez of France - jumped at the opportunity to capture lucrative new sources of production and revenues. Financial institutions hailed this wave as an opportunity for the region to attract capital for modernization and to get rid of unnecessary bureaucracy.

Carlos Menem, who was elected the president of Argentina at this time, became the darling of global financial markets for his aggressive privatization strategy that brought in foreign direct investment, cut inflation and boosted productivity, although his policies also caused major unemployment. At the same time Menem also increased borrowing from the International Monetary Fund and failed to control the flight of capital out of the country by the country’s elite. In 2001, the Argentine economy collapsed again.

In 2003 President Néstor Kirchner was elected. He chose to turn his back on the international financial institutions and renegotiate the national debt at favorable terms and engineer an economic recovery. In 2006 he canceled Argentina’s contract for water supply to Buenos Aires with the French company Suez.

He was succeeded in 2007 by his wife, Cristina Fernández, who maintained his policies of keeping the international institutions and multinationals at bay.

The partial nationalization of YPF (49 percent of the company will remain in the hands of local and foreign private investors) repudiates the advice of international economists but is wildly popular in Argentina. It could bring an influx of cash to the Argentine economy but could also backfire, if it does not.

Then there is the threat of Western interests who do not take kindly to being kicked out. Notably, the government of Spain has not taken the news well. Spanish president Mariano Rajoy has threatened economic sanctions against Argentina, and vice president Soraya Saenz de Santamaria has stated that Spain and its allies "will protect the juridical safety of European investments worldwide". The European Union is considering bringing a case against Argentina to the World Trade Organization.

Fernandez says she has a very pragmatic reason for pushing for nationalization: Argentina’s bills for energy imports hit $9.4 billion last year affecting the country’s trade surplus.

Environmental Impact Questionable

She has the backing of some community activists.

"Repsol is still in debt to the people of Argentina and to nature,” proclaimed the National Peasant and Indigenous Movement (MNCI) on their website. “The REPSOL corporation must assume responsibility for the environmental harms it has caused and damages to natural resources, economically compensating the country and the peasant and indigenous communities that have been affected."

But not all movements are convinced that a state owned YPF will be that different. "As an ecologist collective, and being plainly conscious that the Argentina government was not thinking of environmental issues when it made its decision, we will remain vigilant of (YPF's) future actions," said Noelia Sánchez of the Spanish group Ecologistas en Acción.

Indeed Repsol-YPF has been tried three times by the Permanent Peoples Tribunal for environmental and human rights violations and found guilty. For example in 2010 YPF was accused of trampling on the rights of the Lonko Purran community of Mapuche people in the Cerro Bandera oil field.

Others note that YPF plans to exploit the country's "unconventional" oil and gas finds, such as the Vaca Muerta oil deposit in the province of Neuquen, using hydraulic fracturing (fracking) will mean business as usual, no matter who owns the company: "The future scenario could be one of profound environmental and social risk for much of the country, as experience abroad (of the environmental impact of fracking) has demonstrated,” warns Diego Di Risio, a spokesman for Petroleum Observatory South (Opsur)

Enbridge, Bank of America CEOs Targeted for Extreme Energy Impacts

Posted by Pratap Chatterjee on May 10th, 2012
CorpWatch Blog
Yinka-Dene Alliance newspaper ad.

War has been declared on Enbridge, a Canadian oil company, by a chief from the Nadleh Whut'en in British Columbia. Chief Martin Louie was attending the company annual general meeting in Toronto where he spoke out Wednesday against the environmental impact of the company’s tar sands operations.

"How far are they willing to go to kill off the human beings of this country? Enbridge and the government are going to go on fighting us," said Louie. “The war is on."

Some 700 miles directly south of the Enbridge meeting, on the very same day, Bob Kincaid of Coal River Mountain Watch leveled similar charges against Brian Moynihan, the CEO of Bank of America at their annual general meeting in Charlotte North Carolina, for the impact of mountaintop removal mining.

"You are part of the poisoning of Appalachia and so is every one of your directors and so is every one of your shareholders," Kincaid said. "You are part of the destruction of an entire region of the country."

These two new and unconventional fossil fuel sources –tar sands and mountain top coal together with shale rock –  have been dubbed “extreme energy” sources by Professor Michael Klare of Hampshire College, to signify the extraordinary and expensive technology needed to extract energy from them. The rush to exploit these source - from rural North Dakota (see “North Dakota Shale Boom Displaces Tribal Residents”) to the deserts of South Africa (see “Fracking South Africa”) that has sparked angry protests because of the devastating environmental consequences.

This week the battle against extreme energy was taken to the company annual meetings by environmental and social justice groups. The Nadleh Whut'en were part of the Yinka-Dene Alliance which is protesting Enbridge’s $5.5-billion project that would pipe crude from tarsands in Alberta over 1,100 kilometres to the West coast where the fuel is to be loaded on supertankers to take to Asia.

The protestors brought with them a declaration that read in part:

“We are the Indigenous nations of the Fraser River Watershed. We are many nations, bound together by these waters. Enbridge wants to build pipelines to pump massive amounts of tar sands crude oil through the Fraser’s headwaters. An oil spill in our lands and rivers would destroy our fish, poison our water, and devastate our peoples, our livelihoods, and our futures. Enbridge has many pipeline oil spills every year, including this year’s large spill into Michigan’s Kalamazoo river. We refuse to be next.”

The company claims it is doing a good job. "We wouldn't be proposing this project if we didn't have utmost confidence that we could both construct and operate the project with utmost safety and environmental protection," Enbridge spokesman Todd Nogier told CBC TV.

Brian Moynihan responded the same way to the activists in North Carolina who told him that Bank of America was poisoning Appalachia. "Sir, our environmental team will take a look at it. We look at it all the time,” he told the shareholders who booed him.

Coal River Mountain Watch activists disagreed. “A human health crisis is exploding in Appalachia and Bank of America lights the fuse every day," said Bob Kincaid, noting that as much as five million pounds of explosives are used every day in Appalachia to extract coal. Kincaid estimated that the practice caused 4,000 deaths a year in West Virginia: "That's a newborn who never knows a clear breath, a 4-year-old who never gets to be a 5-year-old, a mother who never gets to be a grandmother.”

At the same annual general meeting on Wednesday, Bank of America also saw a number of protestors speak out against the company’s mortgage practices. For example Sister Barbara Busch, a Catholic social justice worker who runs a Cincinnati-based homeowner advocacy group called Working In Neighborhoods, told Moynihan that his bank was the hardest to deal with (41 percent of her customers have their loans managed by Bank of America)  “(W)we have no one to talk to. They do not call us back,’ she said of the loan officers. “I understand, Mr. Moynihan, that you really believe that you've done something, but ... you've got to do something about your mortgage servicing."

The North Carolina protests were coordinated by the Unity Alliance which brought together groups like Grassroots Global Justice Alliance, Jobs with Justice, the National Day Laborers Organizing Network, the National Domestic Workers Alliance, the Pushback Network, and the Right to the City Alliance.

Although the Bank of America protests are now over, the activists plans to be back – for the Democratic National Convention slated to take place in the city this coming September.

North Dakota Shale Boom Displaces Tribal Residents

Posted by Pratap Chatterjee on April 25th, 2012
CorpWatch Blog
Bakken gas flare. Anonymous photo submitted to BakkenWatch

Heather Youngbird and Crystal Deegan used to live in a trailer at the Prairie Winds Mobile Home Park in the Fort Berthold Indian Reservation in North Dakota. Last week Leroy Olsen, their landlord, removed their front door and cut off the electricity and the propane supply. The reason? New homes to be constructed for out of town oil workers coming to take part in the shale exploration boom.

“This oil boom has divided the Mandan, Hidatsa and Arikara people and pitted them against each other in a negative way,” says Kandi Mossett, a tribal member and organizer with the Indigenous Environmental Network.

In 2010, WPX Energy of Oklahoma paid $925 million for the right to explore for oil on the 86,000 acres of the Fort Berthold Indian Reservation. The company plans to squeeze oil out of shale, the most abundant form of sedimentary rock. Until recently such exploration was prohibitively expensive, but with the evolution of technology and the rise in the price of oil, many rural communities from England to the Ukraine, from Argentina to North Dakota, have become targets for the shale oil boom.

Another company profiting from the Bakken boom, which has been described as the biggest oil find in North America in four decades with an estimated 4.3 billion barrels of recoverable oil, is Continental Resources, also from Oklahoma.

Fort Berthold – the center of the oil boom - has long suffered from crumbling roads and the lack of good housing and proper sewage facilities on the reservation. The companies plan to invest in housing and infrastructure for their workers and plants, but not for local residents.

“Right now, anything that’s available that has water and sewer on it is very attractive to anybody that’s trying to continue to grow their business,” says John Reese, the CEO of the United Prairie Cooperative company, which has taken over the trailer park.

“We were not even given a formal 30 day eviction notice and now that we have been kicked out of our home we are currently homeless,” said Heather Youngbird. The remaining residents of Prairie Winds Mobile Home Park have been told that they had to leave their trailers by May 1, but the eviction date has now been postponed until August 31.

More trouble is expected for the tribal community: Environmental groups note that residents may also soon see problems with their drinking water. “Information posted hydraulic fracturing fluid chemicals on the FracFocus web site indicates that Bakken Shale oil wells may contain toxic chemicals such as hydrotreated light distillate, methanol, ethylene glycol, 2-butoxyethanol (2-BE), phosphonium, tetrakis(hydroxymethyl)-sulfate (aka phosphonic acid),  acetic acid, ethanol, and napthlene,” writes EarthWorks, a Washington DC based group.

Then there is the air pollution: the oil companies are not even bothering to capture the natural gas that is generated by the drilling, partly because there are no state regulations to force them to and partly because it is expensive. Instead the gas is being “flared” or burnt off, the same way Shell does in the Niger delta with similar environmental consequences.

“Across western North Dakota, hundreds of fires rise above fields of wheat and sunflowers and bales of hay. At night, they illuminate the prairie skies like giant fireflies,” wrote Clifford Krauss in the New York Times last September. “Every day, more than 100 million cubic feet of natural gas is flared this way — enough energy to heat half a million homes for a day.”

Perhaps the greatest irony is that North Dakota has the greatest wind resource of almost any state in the country, says Mossett. She says that North Dakota could supply 1.2 trillion kilowatt-hours (kWh) of annual electricity.

Lukoil Threatens Arctic Reindeer

Posted by Pratap Chatterjee on April 23rd, 2012
CorpWatch Blog
Photo: Denis Sinyakov, Greenpeace

An oil spill in northern Russia from a joint venture between Lukoil and Bashneft has damaged fragile reindeer pastures in yet another blow to the indigenous Nenets people. Environmental activists have warned about such disasters for decades but few precautions have been taken by the oil companies.

Lukoil, which is now Russia’s largest oil company, and Bashneft are currently drilling for oil in the Trebs oil field in the Nenets Autonomous District which is estimated to hold 153 million tons of oil.

Vladimir Bezumov, chief of the local office of the Russian Environmental Agency, estimates that some 2,000 tons of oil gushed out of an exploratory well in the oil field this past weekend damaging as much as 14,000 square meters of land.

Oil exploration started in the region in the 1960s and expanded after the collapse of the Soviet Union. Activists warned that environmental problems were bound to get worse. "Western Siberia is already an ecological disaster area because of its many oil mishaps. Any oil accident would have serious consequences, that could reach upriver to the North Polar Sea," Ellen Schmidt wrote in a 1996 report for the World Wide Fund for Nature and a German environmental group called the Association for World Economy, Ecology and Development (AWEED) at the time.

Gail Osherenko, a Vermont-based anthropologist who works with the Nenets peoples, told IPS at the time that the idea oil drilling in the region would have only minimal impact was "wishful thinking."

And Russian and indigenous groups sent out an appeal in 1996 to ask the public to lobby the World Bank not to finance projects in the region. "We ask everyone to help us prevent an environmental nightmare. We ask you not to allow the use of your tax dollars, marks or kronor to facilitate further destruction of the environment," wrote Alexei Grigoriev of the Socio-Ecological Union in Russia in Taiga News.

The warnings were mostly ignored.

An Associated Press investigation by Nataliya Vasilyeva in late 2011 described some of the damage caused by the estimated half a million tons of oil spilled every year that make their way into the Arctic ocean, roughly two-thirds of the quantity of oil spilled in the Deepwater Horizon in the Gulf of Mexico. “On the bright yellow tundra outside this oil town near the Arctic Circle, a pitch-black pool of crude stretches toward the horizon. The source: a decommissioned well whose rusty screws ooze with oil, viscous like jam,” she wrote.

The indigenous communities say their traditional way of life has been devastated by the oil industry. “There is no future for us. People are dying. If oil companies behaved correctly, they would ask us, where drilling is possible and where not, which river is spawning, where fish comes for winter cabin. Fish comes to this bog in the autumn. And now all the rivers are blocked here, and fish has nowhere to go,” Valdimir Vello, a reindeer herder told Greenpeace recently for a report titled “Is there a life after oil?” “I think that there is no future. If the oil companies leave us, we can manage to save something here, to recover this place.”

Politicians are starting to pay attention. Last week, Yuri Trutnev, Russia’s minister for natural resources and ecology threatened to sue Lukoil rival, Anglo-Russian oil producer TNK-BP (owned jointly by British Petroleum and a consortium of the Alfa, Access and Renova groups) for numerous oil spills in Siberia. Trutnev said the company has 784 accidents last year.

"The land is practically flooded with oil," he said after a recent trip to the Khanty-Mansiisk region, according to a report by Gazeta.ru. "We didn't have to look for polluted places, we had to look for places that hadn't been touched by pollution."

The drilling ventures are hugely profitable so they are unlikely to be stopped but there is more than enough money to minimize some of the worst impacts. Since 2003, British Petroleum has paid out an estimated $19 billion in dividends, more than ten times more than it would cost to repair the aging infrastructure, according to an estimate by Gazprombank.

Peru’s Illegal Hardwood Timber Trade

Posted by Pratap Chatterjee on April 11th, 2012
CorpWatch Blog
GPS record of felled tree within the Amazon basin. Photo: Hans Berninzon, Environmental Investigation Agency

Francesco Mantuano, an Italian living in Peru with a timber concession in Loreto region, was puzzled when he got a request in July 2010 from a merchant named Mauro Paredes Sandoval to certify hundreds of trees harvested after just eight days of logging. The wood was to be exported by Madrera Bozovich, a Peruvian company, to its sister company in Alabama.

"After putting two and two together, Mantuano concluded that Paredes was only interested in obtaining (his forest transport permits) in order to launder timber which had already been illegally extracted from other areas, ," write the authors of a new report“The Laundering Machine” just published by the Environmental Investigation Agency (EIA), a Washington DC NGO. "The average harvest operation lasts months - but the low water levels and lack of rain at that time of year in Loreto make it difficult to transport timber on the rivers.

The biggest culprit that EIA uncovered is Grupo Bozovich, a family business set up in the late 1940s by Batrich Bozovich when he arrived from former Yugoslavia and set up business in Oxapampa, in central Peru. The group – which now includes Maderera Bozovich in Peru, Bozovich Timber Products in Alabama and a third company in Mexico – is the biggest exporter of hardwoods from Peru and the biggest importer of such hardwoods into the U.S.

The report alleges that at least 45 percent of shipments made Grupo Bozovich “included wood of illegal origin” such as big leaf mahogany and cedar, which are protected under the under the Convention on International Trade in Endangered Species of Flora and Fauna (CITES)

Surveys of forestry concessions used by Grupo Bozovich by the Supervisory Body for Forest and Wildlife Resources (OSINFOR) found some astonishing discrepancies: In the Productores Forestales Atacuaric concession, just one tree was actually cut down but its “extraction” yielded 311 cubic meters of wood. (The harvested tree in question measured just over 12 cubic meters and was found abandoned in the forest)  In the Oroza Wood S.A.C. concession, government investigators found 14 cedar stumps that turned out to be “disks of roundwood cut from logs and planted in the ground for the benefit of the supervisors.”

“Sometimes intentionally, sometimes through sheer negligence, each of the actors and agencies involved in this system are working as gears in a well-oiled machine that is ransacking Peru's forests and undermining the livelihoods and rights of the people that depend on them," write the EIA investigators. The cost to Peru is estimated to be $250 million a year.

The company denies the allegation. "Bozovich's exports to USA comply with the terms and condition of Lacey Act and the Convention on International Trade in Endangered Species of Wild Fauna and Flora," a U.S. spokesman told Inter Press Service.  (The 2008 Lacey Act requires buyers to practice "due care" to make sure that their products are legal. This is typically done by examining the export certificates)

Experts say that the problem is global. "Justice for Timber" - a March 2012 World Bank report explains the extent of the problem: “Every two seconds, across the world, an area of forest the size of a football field is clear-cut by illegal loggers. In some countries, up to 90% of all the logging taking place is illegal. Estimates suggest that this criminal activity generates approximately US $10-15 billion annually worldwide-funds that are unregulated, untaxed, and often remain in the hands of organized criminal gangs.”

Green Tribunal Weighs Multinational Projects in India

Posted by Pratap Chatterjee on April 9th, 2012
CorpWatch Blog
Sukhdev Sahoo mourns the loss of his betel farm. Photo: Basant Sahoo

Two controversial multinational projects in Orissa, an eastern Indian state, face high level decisions in the next few weeks: a bauxite mine in the Niyamgiri hills planned by Vedanta of the UK and an iron and steel refinery in Jagatsinghpur being developed by POSCO of South Korea.

CorpWatch has reported on both in the past: the bauxite mine threatens the sacred hills of the Dongria Kondh people while the iron and steel refinery threatens traditional betel nut farmers.

As we noted last year, these two battles “encapsulate the chasm between two competing visions of how the second most populous country in the world should develop within the modern world. Jawaharlal Nehru, the country's first prime minister referred to dams and factories as the "temples of modern India," and his successors have gone cap-in-hand to international agencies such as the World Bank to fund major development projects such as the Narmada Valley Dams.

“Rural communities – with the help of city-based activist groups – have struggled to stop the mega-projects. They argue that the displacement of traditional communities, as well as the major environmental impacts of these projects, outweigh the financial benefits. The Narmada dams, for example, while generating electricity and irrigating great areas, would destroy villages and traditional farmland, displacing millions of people.”

Vedanta went before the Indian Supreme Court today to appeal an August 2010 decision by the Indian environment ministry blocking the mine from going forward because of the impact on the indigenous community. The court adjourned without making a decision but justices K S Radhakrishnan and C K Prasad are expected to rule  before the summer vacations. The court may refer the matter to the brand new National Green Tribunal which started hearing cases last year.

The Tribunal which was created in 2010 is “a specialized court with expert members having extraordinary powers to provide remedies to environmental problems.”

One of the Tribunal’s most significant decisions so far has been the suspension of POSCO’s permit last week. The ruling was made when Prafulla Samantray, an activist from Bhoinagar, brought suit over the fact that a comprehensive environmental impact assessment (EIA) report was not done for the 12 million tonne production project. Ritwick Dutta, the lawyer for the activists, told CNN-IBN TV: "Strangely enough the environmental impact assessment studies (were) done only for a 4 million tonne project.”

These two important cases will demonstrate whether or not the National Green Tribunal is up to the task of protecting local communities and the environment in India. Blocking either or both projects will not stop other multinational corporations from continuing to try to exploit the country, but it will surely give them pause in the knowledge that powers that be in New Delhi will listen to communities that organize and push back successfully against irresponsible development and human rights abuse.

As Dongria elder Dodhi Sikaka told Survival: “We are fighting for our own people, for our ancestral land, for Niyamgiri. Those who are fighting for their rights are beaten up and put behind bars. Now all we Dongrias are together in resisting this.”

For a recent and very vivid description of what the Dongria Kondh face, see Bianca Jagger’s latest. She notes: “According to the UN, companies have a responsibility to respect human rights wherever they do business. It is deplorable that local inhabitants should have to implore and appeal to the better nature of shareholders and company executives to protect their human rights, their homes and their livelihoods. Companies who violate this fundamental right should be held accountable in a court of law.”

Adds Jagger: “In the 21st century, we need to redefine the meaning of "development." It must be sustainable. Any development project must take into account the needs and aspirations of the local communities, and should benefit all sectors of society.”

Fracking South Africa

Posted by Pratap Chatterjee on March 29th, 2012
CorpWatch Blog
Karoo, South Africa. Photo: flowcomm. Used under Creative Commons license

The Karoo is not as well known as Kruger National Park with its elephants, leopards and lions. Located in the Western Cape region of South Africa, it is a desert area that is home to tortoises and eagles, and has been the subject of recent experiments to resettle the black rhino and resurrect the quagga, an unusual zebra like creature that went extinct in 1998. But today the people, flora and fauna of the Karoo are threatened by companies like Shell, the Anglo-Dutch oil company, which wants to drill for natural gas.

Like many ancient lands, the Karoo has fossil fuels trapped underground. Royal Dutch Shell, Falcon Oil & Gas and Bundu Oil & Gas want to explore 90,000 square kilometres for the natural gas using a controversial new technology called “fracking”

Bonang Mohale, the chairman of Shell South Africa, recently described the business potential as “bigger than the discovery of gold in Gauteng

However, a coalition of concerned citizens - Treasure the Karoo Action Group (TKAG) – has sprung up to oppose the plan. Their mission to their fellow citizens is simple: “South Africa cannot afford to gamble with your water supply, food security, the health of your family, and the heritage of your children in pursuit of a short-term gain for foreign oil companies and our government.”

TKAG is supported by Greenpeace, who attempt to explain what this technology does: “To access these reserves, fluid is pumped down a drilled channel (well) into the gas-bearing rock at very high pressures. This causes the rock to fracture, creating fissures and cracks through which the gas can 'escape'. The fracturing liquid generally consists of mainly water, mixed with sand and chemicals. Numerous different chemical agents are used, many of which are flagged as dangerous to humans and the environment (carcinogens, acute toxins).

“The fracturing of a single well requires a huge volume of water: around 9,000 - 29,000 m3 (9 -29 million litres). Chemicals make up about 2% of the fracturing liquid, i.e. about 180,000 – 580,000 litres. Only 15 – 80% of the injected fluid is recovered, meaning that the rest remains underground, where it is a source of contamination to water aquifers.”

Chris Hartnady, a well known geologist, says that fracking could have a huge impact on the Karoo desert especially because it will deplete the dwindling water supply. “Shale gas production would become a serious competitor for water, requiring as much as four times the current annual usage of the groundwater in all three of the Shell exploration areas,” he said at the Shale Gas Southern Africa conference in Cape Town earlier this week.

Hartnady noted that surface water might also become contaminated with fracking fluids and waste water. Indeed, communities in the U.S. have seen tap water catch on fire in fracking areas. (Watch this YouTube video and this one from Time magazine) Fracking can also dramatically increase the likelihood of earthquakes, according to recent research in Youngstown, Ohio, where residents were hit last Christmas Eve and again on New Year's Eve.

To learn more about the dangers of fracking, check out the film Gasland and the Drilling Down series in the New York Times.

Chevron & Transocean Back in the Dock Over Oil Spills

Posted by Pratap Chatterjee on March 22nd, 2012
CorpWatch Blog
Chevron Spoof Ad. Photo: The Yes Men. Used under Creative Commons license

Brazil has demanded that 17 Chevron and Transocean executives surrender their passports while they await the outcome of criminal charges brought against them for a spill that took place off the coast of Rio de Janeiro last November. The company has also been sued for $11 billion in damages by a Brazilian federal prosecutor.

Chevron has issued a statement claiming the charges are "outrageous and without merit.”  “We have sought to perform our operations in full compliance with Brazilian laws and industry practices and to comply with all applicable licenses and authorizations,” says a company press release issued Wednesday.

The jury is still out on the facts of the case. But it is hard to sympathize with a company that has played fast and loose with national justice systems in order to avoid paying compensation for toxic spills of immense proportions in the Ecuador by Texaco, a company that Chevron merged with in 2001.

Between 1964 to 1992 Texaco admitted to dumping more than 16 billion gallons of toxic “water of formation” into the streams and rivers used by local inhabitants for their drinking water, decimating indigenous groups and causing dramatically increased rates of cancer, according to a summary from Rainforest Action Network.

In 2002, Chevron asked for a trial in Ecuador to avoid a U.S. court battle. Eight years and 220,000 pages of evidence later, the courts ordered the company to pay $18.2 billion in damages. Chevron appealed but the Ecuadorean appellate court ruled against them on January 3, 2012. Now the company is attempting to have the judgement thrown out by a secret arbitration panel under a provision in the U.S. Ecuador Bi-Lateral Trade Agreement.

“Chevron won’t pay to clean up the toxic oil waste it deliberately dumped in the Ecuadorian Amazon, which has resulted in a human health crisis for the people living in the region. But it will pay thousands to lobby state leaders and ambassadors to extend its extreme investor rights, and continue to evade justice elsewhere,” said Ginger Cassady, campaign director at Rainforest Action Network.

Transocean, which is one of the largest offshore drilling contractors, has also been in trouble over oil spills. The U.S. company, which is headquartered in Switzerland was implicated in the Deepwater Horizon explosion that killed 11 men on April 10, 2010. Approximately 4.9 million barrels of oil were spilled into the Gulf of Mexico which caused major damage to the local marine environment and the fishing and tourism industries.

A Wall Street Journal review found that the company was involved in “three of every four incidents that triggered federal investigations into safety and other problems on deepwater drilling rigs in the Gulf of Mexico since 2008.” The newspaper noted that Transocean has accounted for 24 of the 33 incidents investigated by the U.S. Minerals Management Service despite during that time owning fewer than half the Gulf of Mexico rigs operating in more than 3,000 feet of water.

Oil companies rank among the most profitable in the world. Chevron pulled in $26.9 billion in profits last year and Transocean made close to a billion dollars. Surely they could spare some of that money to pay for the clean-up of the mess they leave behind?

U.S. Supreme Court: Can Multinationals Be Sued for Crimes?

Posted by Pratap Chatterjee on March 1st, 2012
CorpWatch Blog
Project Underground poster on Shell

Barinem Kiobel was executed on November 10, 1995 by the military dictatorship of General Sani Abacha of Nigeria. Almost 16 years later, the U.S. Supreme Court is poised to decide whether Shell, the Anglo-Dutch oil multinational, can be held responsible for his death.

The lawsuit has been brought under the Alien Tort Claims Act of 1789 which allows lawsuits against individuals in U.S. courts for violations of international law – but what the court will decide is if this law applies to corporations. If the Supreme Court rules in favor of the plaintiff – his widow Esther – it could represent a watershed in holding corporations accountable for crimes around the world. (See EarthRights for more on Alien Torts)

The 42 year old was one of nine activists from Ogoni land in the Niger Delta who were sentenced to death by hanging. Ken Saro-Wiwa, another of the men who was executed that day, had already become an international cause celebre as a poet and an outspoken leader of the Movement for the Survival of the Ogoni People (MOSOP) that was leading protests against the massive pollution of the region caused by its oil extraction. (See MOSOP website here)

In 2009, Shell agreed to pay out $15.5 million to settle a lawsuit brought by the Center for Constitutional Rights on behalf of Saro-Wiwa’s family against the company in which they were alleged to have conspired with the military to capture, torture and kill protestors. The company did not admit guilt: "While we were prepared to go to court to clear our name, we believe the right way forward is to focus on the future for Ogoni people," Malcolm Brinded, a Shell director, said at the time. The money was placed in a trust for the education of the Ogoni people. (See the Center for Constitutional Rights summary here)

“Businesses with mining and drilling operations abroad decimate local populations with the full consent of brutal regimes, and when the people affected assemble and protest, family members are abducted, people are murdered, profits are defended at all costs and no local justice or accountability is possible because of government complicity,” wrote Vincent Warren of the Center for Constitutional Rights in the New York Times. “The decision before the court now boils down to whether corporations — considered legal persons already in many cases — should be held to the same standards of accountability as actual people when they commit egregious crimes.”

Susan Farbstein and Tyler Giannini, the directors of the International Human Rights Clinic of the Harvard Law School agree: “In exchange for rights, corporations accept certain responsibilities, including liability for harms committed by their agents,” they wrote in the same newspaper.

What makes this argument compelling is another decision made by the Supreme Court on January 21, 2010, in Citizens United v Federal Election Commission, where the justices decided, by a vote of five to four, that, since corporations were legal persons, they were entitled to the protection of the first amendment, which guarantees freedom of speech. (The case was brought by Citizens United, a company that wanted to air a film critical of Hillary Clinton)

Bad Karma in the Gulf of Mexico Oil Disaster

Posted by Phil Mattera on May 10th, 2010

Originally posted on May 7 at Dirt Digger's Digest.

http://dirtdiggersdigest.org/wordpress/wp-content/uploads/2010/05/deepwaterhorizon1.jpg

British Petroleum is, rightfully, taking a lot of grief for the massive oil spill in the Gulf of Mexico, but we should save some of our vituperation for Transocean Ltd., the company that leased the ill-fated Deepwater Horizon drilling rig to BP. Transocean is no innocent bystander in this matter. It presumably has some responsibility for the safety condition of the rig, which its employees helped operate (nine of them died in the April 20 explosion).

Transocean also brings some bad karma to the situation. The company, the world’s largest offshore drilling contractor, is the result of a long series of corporate mergers and acquisitions dating back decades. One of the firms that went into that mix was Sedco, which was founded in 1947 as Southeastern Drilling Company by Bill Clements, who would decades later become a conservative Republican governor of Texas.

In 1979 a Sedco rig in the Gulf of Mexico leased to a Mexican oil company experienced a blowout, resulting in what was at the time the worst oil spill the world had ever seen. As he surveyed the oil-fouled beaches of the Texas coast, Gov. Clements made the memorable remarks: “There’s no use in crying over spilled milk. Let’s don’t get excited about this thing” (Washington Post 9/11/1979).

At the time, Sedco was being run by Clements’s son, and the family controlled the company’s stock. The federal government sued Sedco over the spill, claiming that the rig was unseaworthy and its crew was not properly trained. The feds sought about $12 million in damages, but Sedco drove a hard bargain and got away with paying the government only $2 million. It paid about the same amount to settle lawsuits filed by fishermen, resorts and other Gulf businesses. Sedco was sold in 1984 to oil services giant Schlumberger, which transferred its offshore drilling operations to what was then known as Transocean Offshore in 1999.

In 2000 an eight-ton anchor that accidentally fell from a Transocean rig in the Gulf of Mexico ruptured an underwater pipeline, causing a spill of nearly 100,000 gallons of oil. In 2003 a fire broke out on a company rig off the Texas coast, killing one worker and injuring several others. As has been reported in recent days, a series of fatal accidents at company operations last year prompted the company to cancel executive bonuses.  It’s also come out that in 2005 a Transocean rig in the North Sea had been cited by the UK’s Health and Safety Executive for a problem similar to what apparently caused the Gulf accident.

Safety is not the only blemish on Transocean’s record. It is one of those companies that engaged in what is euphemistically called corporate inversion—moving one’s legal headquarters overseas to avoid U.S. taxes. Transocean first moved its registration to the Cayman Islands in 1999 and then to Switzerland in 2008. It kept its physical headquarters in Houston, though last year it moved some of its top officers to Switzerland to be able to claim that its principal executive offices were there.

In addition to skirting U.S. taxes, Transocean has allegedly tried to avoid paying its fair share in several countries where its subsidiaries operate. The company’s 10-K annual report admits that it has been assessed additional amounts by tax authorities in Brazil and that it is the subject of civil and criminal tax investigations in Norway.

In 2007 there were reports that Transocean was among a group of oil services firms being investigated for violations of the Foreign Corrupt Practices Act in connection with alleged payoffs to customs officials in Nigeria. No charges have been filed.

An army of lawyers will be arguing over the relative responsibility of the various parties in the Gulf spill for a long time to come. But one thing is clear: Transocean, like BP, brought a dubious legacy to this tragic situation.




Oil spill changes everything

Posted by Michael Brune on May 2nd, 2010

Originally posted on CNN.com on May 1.

tzleft.michael.brune.eanes.jpg

Michael Brune

Editor's note: Michael Brune is executive director of the Sierra Club and former director of the Rainforest Action Network.

The oil disaster plaguing the Gulf of Mexico and our coastal states puts our desperate need for a new clean energy economy in stark relief. We need to move away from dirty, dangerous and deadly energy sources.

We are pleased that the White House is now saying it will suspend any new offshore drilling while the explosion and spill are investigated, but there should be no doubt left that drilling will only harm our coasts and the people who live there.

Taking a temporary break from offshore drilling is an important step, but it's not enough. We need to stop new offshore drilling for good, now. And then we need an aggressive plan to wean America from dirty fossil fuels in the next two decades.

This BP offshore rig that exploded was supposed to be state-of-the-art. We've also been assured again and again that the hundreds of offshore drilling rigs along our beaches are completely safe. Now, we've seen workers tragically killed. We've seen our ocean lit on fire, and now we're watching hundreds of thousands of gallons of toxic oil seep toward wetlands and wildlife habitat.

This rig's well is leaking 210,000 gallons of crude every day, wiping out aquatic life and smothering the coastal wetlands of Louisiana and Mississippi. As the reeking slick spreads over thousands of square miles of ocean, it rapidly approaches the title of worst environmental disaster in U.S. history, even worse than 1989's Exxon Valdez oil spill. The well is under 5,000 feet of water, and it could take weeks or even months to cap it.

This disaster could unfortunately happen at any one of the hundreds of drilling platforms off our coasts, at any moment. It could happen at the drilling sites that the oil industry has proposed opening along the beaches of the Atlantic Coast.

Indeed, even before this spill, the oil and gas industry had torn apart the coastal wetlands of the Louisiana Bayou over the years. These drilling operations have caused Louisiana to lose 25 square miles of coastal wetlands, which are natural storm barriers, each year.

Another view: Why it won't be easy to replace fossil fuels

And it's hardly just the environmental costs of oil spills that we have to worry about with offshore drilling. The threat to the people who work on these platforms has again become terribly clear. In fact, more than 500 fires on oil platforms in the Gulf have injured or killed dozens of workers in just the past four years, according to the federal Minerals Management Service.

We don't need to pay this price for energy. We have plenty of clean energy solutions in place that will end our dependence on dirty fossil fuels, create good, safe jobs and breathe new life into our economy.

One huge example came Thursday, when the Obama administration approved our country's first offshore wind farm.

Our country has huge solar power potential as well. We can also save more oil through simple efficiency measures than could be recovered by new drilling on our coastlines.

This oil spill changes everything. We have hit rock-bottom in our fossil fuel addiction. This tragedy should be a wake-up call. It's time to take offshore drilling off the table for good.

The opinions expressed in this commentary are solely those of Michael Brune.




Chevron Gets Fixed

Posted by Antonia Juhasz on November 4th, 2009
Huffington Post

Originally published on 3 November 2009.

On Sunday, Chevron became the first oil company to come under a Yes Men Audience Attack.

(See Video, Photos, and Yes Man Andy Bichlbaum's Blog of event)

Chevron was chosen because Chevron is different from other oil companies.

It is bigger than all but three (only ExxonMobil, BP and Shell are larger). It is facing the largest potential corporate liability in history ($27 billion) for causing the world's largest oil spill in the Ecuadorian rainforest. It is the only major U.S. Corporation still operating in Burma and, with its partner Total Oil Corp., is the single largest financial contributor to the Burmese government. It is the dominant private oil producer in both Angola and Kazakhstan, with operations in both countries mired in human rights and environmental abuses. It is the only major oil company to be tried in a U.S. court on charges of mass human rights abuse, including summary execution and torture (for its operations in Nigeria).

It is the only oil company to hire one of the Bush Administration's "torture memo" lawyers (William J. Haynes). It is the largest and most powerful corporation in California, where it is currently being sued for conspiring to fix gasoline prices. It has led the fight to keep California as the only major oil producing state that does not tax oil when it is pumped from the ground, thereby denying the state an extra $1.5 billion annually. It is the largest industrial polluter in the Bay Area and is among the largest single corporate contributors to climate change on the planet.

Chevron is also the focus of one of the world's most unique and well-organized corporate resistance campaigns.

That campaign got a jolt of energy when Yes Man Andy Bichlbaum came to San Francisco on Halloween weekend for a special screening of The Yes Men Fix the World.

Global Exchange and I teamed up with Andy (the movie's co-writer, director, and producer) and a host of the Bay Areas most creative activists, to lead an entire movie audience out of the theater, into the streets, and in protest of Chevron.

We spread the word early, far, and wide: The Yes Men are coming! The Yes Men are coming! They will not only fix the world, they will fix Chevron too!

Larry Bogad, a Yes Man co-hort and professor of Guerilla Theater, helped concoct a masterful street theater scenario. A crack team of protest and street theater organizers was compiled, including David Solnit of the Mobilization for Climate Justice and Rae Abileah of Code Pink. Rock The Bike signed on and the word kept spreading.

On Sunday, the Roxie Theater in San Francisco's Mission District was filled beyond capacity with an audience that came ready to protest. They laughed, clapped, booed, and cheered along with the film. When the movie ended, Andy answered questions, I talked about Chevron, and Larry laid out the protest scenario.

Three Chevron executives, protected from the early ravages of climate change in SurvivaBalls, were dragged up the street by dozens of Chevron minions with nothing but haz-mat suits to protect them. Those unable to afford any protection (i.e. The Dead) followed close behind. Next came resistance: the Chevron street sweepers, actively cleaning up Chevron's messes who were followed by the protesters, ready to change the story.

We didn't have a permit, but we took a lane of traffic on 16th street anyway. The police first tried to intervene, then they "joined in," blocking traffic on our way to Market and Castro.

As we marched and the music blared, people literally came out of their houses and off of the streets to join in. Passersby eagerly took postcards detailing Chevron's corporate crimes.

Once we arrived at the gas station, I welcomed everyone and explained that we were at an independent Chevron (as opposed to corporate) station, whose owner (whom I'd been speaking with regularly) had his own list of grievances with his corporate boss. The particular station was not our target of protest, but rather, the Chevron Corporation itself.

Larry and Andy than led the entire crowd in a series of Tableaux Morts. The Chevron executives in their SurvivaBalls drained the lifeblood from the masses. The people began to rebel, forcing the SurvivaBalls into the "turtle" position to fend off the attacks. Ultimately, the separate groups saw their common purpose in resisting Chevron's abuses. The dead rose, the Chevron minions rebelled, and the sweepers and protesters joined together. They all chased the Chevron executives off into the distance, and then danced in the streets, rejoicing in their shared victory!

The Chevron Program I direct at Global Exchange seeks to unite Chevron affected communities across the United States and around the world. By uniting these communities, we build strength from each other, and become a movement. By expanding, strengthening, and highlighting this movement, we bring in more allies and create a powerful advocacy base for real policy change. Those changes will reign in Chevron, and by extension, the entire oil industry. And, by raising the voices of those hardest hit by the true cost of oil and exposing how we all ultimately pay the price, we help move the world more rapidly away from oil as an energy resource altogether.




Berkeley, Oakland urge oil money transparency

Posted by Josh Richman on October 20th, 2009

Originally posted, October 14, 2009 on http://www.ibabuzz.com/politics/2009/10/14/berkeley-oakland-urge-oil-money-transparency/

Berkeley City Council last night approved a resolution urging the U.S. Senate to approve S.1700, the “Energy Security Through Transparency Act” by U.S. Sen. Richard Lugar, R-Ind., which would urge the Obama Administration to require that companies disclose payments to foreign governments for oil, gas and mineral rights. Oakland City Council passed a similar resolution last week.

“Good governance in extractive industries contribute to a better domestic investment climate for U.S. businesses, increase the reliability of commodity supplies, promote greater U.S. energy security and thereby strengthen our national security,” says the summary on Lugar’s Web site.

San Francisco-based Justice in Nigeria Now hails the cities’ actions as a moral victory.

“I was tortured and imprisoned by the Nigerian military for my peaceful protests against Shell Oil’s destruction of our land,” Suanu Kingston Bere, a Nigerian activist who spoke at the Berkeley City Council meeting, said in JINN’s news release. “I believe the City’s support sends a strong message that communities in the U.S are concerned about the human rights abuses and environmental damage associated with oil extraction. I do not want to see my people continue to go through what I went through.”

Berkeley’s resolution also calls on the State Department to support third-party peace talks in the Delta to address environmental destruction and lack of investment in the oil producing region. The resolution was co-sponsored by Councilmembers Jesse Arreguin, Darryl Moore and Max Anderson and was introduced to the council through the Berkeley Peace and Justice Commission, which worked with JINN to draft it.

JINN says 50 years of oil exploitation in the Niger Delta has produced over $700 billion in oil revenues shared between the Nigerian government and oil giants like San Ramon-based Chevron as well as Exxon Mobil and Shell. More than 40 percent of Nigeria’s oil is exported to the U.S. Yet despite the corporate oil wealth, local residents’ quality of life has deteriorated – their drinking polluted, their food fisheries poisoned, their access to education, health care and even electricity limited.

“Oil companies in Nigeria have had long a relationship with the notoriously corrupt and historically brutal Nigerian government where rampant corruption, fraudulent elections and violent suppression of peaceful protests are the norm in the Delta,” Nigerian writer and activist Omoyele Sowore said in JINN’s news release. “The proposed ESTT Act in the Senate is an important step toward holding oil companies accountable for their collusion with the Nigerian government, which protects their profits while killing and injuring innocent local people and destroying the Delta’s fragile environment.”

Still Learning Nothing

Posted by Mark Floegel on September 24th, 2009

Originally posted at http://markfloegel.org/

The best time to announce the worst news is late on Friday. The federal government and public relations firms have known this for years. So it was that the National Marine Fisheries Service (NMFS) scheduled its press conference last Friday for 3 p.m., Pacific Daylight Time or (even better!) 6 p.m. in the east.

As planned, the news that stocks of Bering Sea pollock – America’s largest fishery – have declined to a 30-year-low was reported only in the fishing trade press and the Seattle and Anchorage papers. Mission accomplished.

Every summer, NMFS technicians survey pollock. The amount of fish allowed to be caught in 2009 was based on the 2008 summer survey. The 2010 quota will be based on the 2009 survey and so on. On one hand, these surveys are about “environmental protection.” (Alas, we must us the dreaded quotation marks, because the environment has not been protected.) On the other hand, the surveys are a government-subsidized service for the industrial trawler fleet that pulls the pollock from the sea.

On the other, other hand (we’re playing three hands today), most people don’t know what a pollock is, but we eat enough of it. (As I mentioned two paragraphs ago, it’s America’s largest fishery.) All that imitation crabmeat in the supermarket wet case? Pollock. (And why must pollock imitate crabmeat? American fisheries management.)

Pollock is the whitefish in all those disgusting frozen fish sticks. Pollock is, or was, the fish in the sandwiches at the fast food restaurants. Now that pollock is in severe decline, McDonald’s is considering switching to hoki. This has nothing to do with environmental awareness; McDonald’s requires a steady supply of a consistent product at a predictable price. Hoki, a whitefish that’s overfished by industrial trawlers in New Zealand waters, will be a temporary fix, a few years at best. Thanks, Ronald.

Where was I? Oh right, severe decline. Three years ago, NMFS allowed the trawlers to take 1.5 million metric tons of pollock out of the Bering Sea. This year, because the decline was already evident in last year’s survey, the quota was set at 815,000 metric tons. The industry trade press headlines news like this as: “Pollock prices likely to rise.”

The At-Sea Processors Association, the trade group that represents the industrial trawlers, will try to convince the feds to keep the quota high and if the past is any evidence, they’ll do it. That’s why the fish population is crashing. What’s worse, they may bully the feds into continuing the pollock roe season. Roe, of course, is fish talk for eggs. The trawlers deliberately target the pregnant females, strip the eggs out of their bellies and sell them for big bucks on the Asian market.

What the Epicureans of Korea and Japan eat for dinner is what doesn’t become a fish in the Bering Sea, with tragic consequences for the sea and the other animals that live there. Pollock have traditionally been mighty breeders, the rabbits of the northern seas (one reason we fish them so hard). As such, they’ve provided much of the food for the rest of the animals in the ocean, like Steller sea lions and Pribilof fur seals. Because we humans got greedy with the trawlers and the roe, now those species (and more) are in trouble.

Yes, eating the eggs is a great way to deplete a population of fish (or any other wild creature) and yes, there’s more to it than that. Global warming plays a role, with warm water moving north into the Bering Sea, making conditions for pollock love less favorable than they’ve been in decades past. The pollock don’t cause global warming, though, nor do sea lions or fur seals. So yeah, we should stop burning so many fossil fuels, but until we do, we have to back off with the trawlers and give the pollock time to rebuild their numbers.

An irony here (not the irony, there’s too much irony for that) is that Bering Sea pollock are often referred to (by the industrial trawling people) as “the best-managed fishery in the world.” Sadder still is that the statement is not far from accurate. Look at Atlantic cod, that population crashed 15 years ago and has yet to come back.

And we learned nothing from it.

Corporations and the Amazon

Posted by Philip Mattera on August 16th, 2009


Originally posted on August 13, 2009 at http://dirtdiggersdigest.org/archives/746

These days just about every large corporation would have us believe that it is in the vanguard of the fight to reverse global warming. Companies mount expensive ad campaigns to brag about raising their energy efficiency and shrinking their carbon footprint.

Yet a bold article in the latest issue of business-friendly Bloomberg Markets magazine documents how some large U.S.-based transnationals are complicit in a process that does more to exacerbate the climate crisis than anything else: the ongoing destruction of the Amazon rain forest.

While deforestation is usually blamed on local ranchers and loggers, Bloomberg points the finger at companies such as Alcoa and Cargill, which the magazine charges have used their power to get authorities in Brazil to approve large projects that violate the spirit of the country’s environmental regulations.

Alcoa is constructing a huge bauxite mine that will chew up more than 25,000 acres of virgin jungle in an area, the magazine says, “is supposed to be preserved unharmed forever for local residents.” Bloomberg cites Brazilian prosecutors who have been waging a four-year legal battle against an Alcoa subsidiary that is said to have circumvented the country’s national policies by obtaining a state rather than a federal permit for the project.

Bloomberg also focuses on the widely criticized grain port that Cargill built on the Amazon River. Cargill claims to be discouraging deforestation by the farmers supplying the soybeans that pass through the port, but the Brazilian prosecutors interviewed by Bloomberg expressed skepticism that the effort was having much effect.

Apart from the big on-site projects, Bloomberg looks at major corporations that it says purchase beef and leather from Amazonian ranchers who engage in illegal deforestation. Citing Brazilian export records, the magazine identifies Wal-Mart, McDonald’s, Kraft Foods and Carrefour as purchasers of the beef and General Motors, Ford and Mercedes-Benz as purchasers of leather.

The impact of the Amazon cattle ranchers was also the focus of a Greenpeace report published in June. That report put heat on major shoe companies that are using leather produced by those ranchers.

Nike and Timberland responded to the study by pledging to end their use of leather hides from deforested areas in the Amazon basin. Greenpeace is trying to get other shoe companies to follow suit.

Think of the Amazon the next time a company such as Wal-Mart tells us what wonderful things it is doing to address the climate crisis.

Chipotle Grilled!

Posted by Denver Fair Food on July 31st, 2009

Originally posted on July 23 at http://denverfairfood.blogspot.com/2009/07/chipotle-grilled.html.

Chipotle is getting burned by the very scheme it cooked up as what it thought was a great public relations opportunity - sponsoring free screenings of Food, Inc. - is becoming a PR fiasco.

Food, Inc. director Robert Kenner and co-producer Eric Schlosser speak out and Chipotle has to answer tough questions in Tom Philpott's must-read article on Grist.org "Chipotle Grilled: Burrito chain’s Food, Inc. sponsorship generates off-screen drama over farm-worker issues."

Schlosser explains that while many of Chipotle's efforts are great, he nonetheless "cares more about human rights than any of those things." He continues: "If Taco Bell, Subway, Burger King, and McDonald’s can reach agreement with the CIW, I don’t see why Chipotle can’t."

Kenner likewise, the article states, "made clear that he disagreed with the company’s position on the CIW" even if he agrees with other things Chipotle is doing. Kenner explains: "I was hopeful that by associating itself with a film that promotes workers’ rights, [Chipotle] might be inclined to sign with the Coalition . . . And now I’m not confident they will.”

Our cameo in this unfolding fiasco is also noted: "Chipotle clearly resents such critical statements at events designed to demonstrate its sustainability cred. At one of its screenings in Denver, Chipotle employees barred people from the Campaign for Fair Food to speak after the screening—overturning an arrangement that had been made with Food, Inc’s public-education campaign. " After investigating the incident, the article decides: "In other words, people wanting to discuss the CIW issue aren’t to be given stage time at the Chipotle-sponsored Food, Inc. screenings."

Our story of Chipotle's eagerness to shut up members of Denver Fair Food has really made a splash on the internet, appearing on the websites of the Organic Cosumers Association, the Coporate Ethics Network, US Indymedia, and others.

Of course Denver wasn't the only city where Chipotle got heat from Fair Food activists while trying to bask in Food, Inc.'s glory. All over the country allies of the Coalition of Immokalee Workers took to the movies to deflate Chipotle's hot air about "food with integrity" with some sharp truths about farm labor in Chipotle's supply chain. See the great photo report from the nationwide "Battle of the Burrito" on the CIW website.

References to this PR fiasco are popping up in unforseen places such as thedailygreen or even more surprising the mainstream investor blog The Motely Fool. And the bed which Chipotle made for itself in which it now must lie can't be feeling any more comfortable.

The lesson for Chipotle to learn from its bungled Food, Inc. PR experiment? The ecorazzi blog has these fitting words: "you can’t have your 1000+ calorie burrito and eat it too."

Shell's Settlement Doesn't Hide Unsettling Reality in Nigeria

Posted by Stephen Kretzmann on June 11th, 2009

Originally posted June 10, 2009, on The Huffington Post.

After thirteen years and countless hours by lawyers, community members, and activists around the world, Royal Dutch Shell finally settled the Wiwa v Shell case in a New York court for $15.5 million.

Plaintiffs in the case, which included Ken Saro-Wiwa Jr., and the families of other Ogoni men hanged in November 1995, charged the Royal Dutch/Shell company, its Nigerian subsidiary, and the former chief of its Nigerian operation, Brian Anderson, with complicity in the torture, killing, and other abuses of Ogoni leader Ken Saro-Wiwa and other non-violent Nigerian activists in the mid-1990s in the Ogoni region of the Niger Delta.

Shell says they settled the case as a "humanitarian gesture" to the Ogoni. Does anyone really believe that after fighting for more than a decade to keep this out of court, Shell suddenly woke up and felt great compassion for the Ogoni? Please.

Shell settled because they were scared, and they knew the evidence against them was overwhelming. They publicly say they had nothing to do with the execution of Ken Saro-Wiwa and the other Ogoni, and yet there were documents and video that they fought hard to keep out of the public eye.

Evidence that was to be introduced in the case included an internal Shell memo where the head of Shell Nigeria offered to intervene on Saro-Wiwa's behalf, if only Saro-Wiwa and others would stop claiming that Shell had made payments to the military.

Then there was this memo, requesting payment to the Nigerian military for an incident in which at least one Ogoni man died.

Witness were set to testify that they saw Shell vehicles transporting Nigerian soldiers, that they saw Shell employees conferring with the military, that they saw money being exchanged between Shell employees and military officers, and that they heard military officers, including the brutal Major Okuntimo of the Rivers State Internal Security Task Force, make admissions regarding the work they were doing on behalf of Shell.

We have known some of Shell's involvement in this tragedy for a long time. In early May of 1994, Ken Saro-Wiwa Sr. faxed me a memo authored by Major Okuntimo which read "Shell operations still impossible unless ruthless military operations are undertaken for smooth economic activities to commence" and further called for "pressure on oil companies for prompt regular inputs."

I received that fax and immediately called Ken. He said "this is it. They're going to kill us all. All for Shell." It was the last time I talked with him. Several weeks later he was arrested on the trumped up charges for which he was ultimately hanged.

In the last day, lots of people have asked me if $15.5 million is enough to compensate for the hanging of nine men, the death of thousands more, and for the destruction of an ecosystem. No of course not. But was it on par with what a jury would have awarded in this case? Yes, lawyers tell me, for sure.

More importantly, does the settlement bring relief to Ken Wiwa Jr. and the families of the other men who were executed? If you read Ken's thoughtful and moving piece in the Guardian , the answer is clearly yes. That alone should be cause for celebration.

Ken Sr.'s famous last words from the gallows were "lord take my soul but the struggle continues." In this moment, perhaps more than ever before, we need to heed that call to action. The settlement in this case brings satisfaction to the plaintiffs for an event that happened 14 years ago. It in no way, shape or form excuses or absolves Shell of their ongoing destruction of the Niger Delta environment.

One of the central complaints of Niger Delta communities for forty years has been gas flaring, which sends plumes of toxic pollutants into the air and water of the Niger Delta. Gas flaring endangers human health, harms local ecosystems, emits huge amounts of greenhouse gases, wastes vast quantities of natural gas, and is against Nigerian law. Shell does it nowhere else in the world in volumes that are even remotely comparable to what they flare in the Delta.

But Shell is still flaring gas in Nigeria.

While there is no doubt that the settlement represented a significant victory for the plaintiffs' in this one human rights case against Shell, true justice will not be served as long as the people of Nigeria continue to suffer the terrible impact of Shell's operations. Shell estimates it would cost about $3 billion -- only 10% of just their last year's profits -- to end Shell's gas flaring in Nigeria once and for all.

But instead of putting their great "humanitarian concern" into action, Shell points the finger at the Nigerian government and demands that they pay to end this practice.

Send a message to Shell's CEO
Jeroen van der Veer, and let him know that if he really wants to prove his great concern for the Ogoni people, he'll end gas flaring once and for all.

The struggle continues.

The IDB—50 Years, Zero Reflection

Posted by Laura Carlsen on April 3rd, 2009
Americas Policy Program, Center for International Policy

At the end of March, the Inter-American Development Bank (IDB) celebrated its 50th anniversary in Medellin. The occasion presents an opportunity to revise concepts and move toward a fairer development model. It is logical to think that among the festivities, a process of evaluation and self-critique would begin regarding the bank's actions and work in the region.

The circumstances demand it. The continent has been plunged into a grave economic crisis, in part because of the string of structural reforms, deregulation, foreign market dependence, and privatization that the IDB has supported in the region. Limits on the use of non-renewable fuels have become more and more obvious while climate change threatens to affect the production of basic foods and increase the frequency of natural disasters. Forced migration characterizes modern life and growing inequality has become the most important challenge faced by all the countries in the region.

      Medellin: site of the 50th anniversary of the IDB. Photo: www.skyscraperlife.com.

In spite of this gray outlook, it seemed that until now everything suggested that the IDB would prescribe more of the same medicine. They predicted an increase in loans to the region for the record figure of US$18 billion for 2009 as a response to the crisis. This will generate a new wave of debt in the recipient countries, while at the same time the development model behind the loans faces a crisis of credibility due to its dubious results. For the IDB, development is seen as a process of ensuring the transnational mobility of capital, enabling foreign investment, the transfer of goods, and access to natural resources. In recent years, this model has been imposed on regions that were previously closed off due to their geographical location or because of little interest from big business. Now that the value of natural resources is increasing and national economies have opted for exports, mega-projects including transportation infrastructure and hydroelectric power plants, among others, have become attractive again. They generally target regions with a low population density, and, in many cases, significant indigenous populations. While these communities are often forgotten by their national governments and suffer high levels of marginalization, at the same time their territories are rich in both culture and biodiversity.

The IDB has been a major promoter of infrastructure mega-projects designed to drive this vision. Two mega-project master plans have been of particular interest to the IDB: The Plan Puebla-Panama (also known as the Mesoamerican Integration and Development Project) and the Initiative for the Integration of Regional Infrastructure in South America (IIRSA). These plans include the construction of super-highways, dams, electricity networks, and more. The projects signal a drastic change in the use of land and resources. Local, regional, and national markets—which generate more jobs and constitute the majority of food distribution—are seen as a hindrance, and natural resources—conserved by indigenous communities—are considered the spoils of transnational business.

Among its objectives, the IDB aims to generate development in these regions. However, a recent study revealed that the mega-projects financed by the IDB in many cases end up displacing thousands of people who are supposed to be the beneficiaries. The construction of dams is the clearest example because it entails the involuntary displacement through the flooding of vast areas which often include pre-existing communities. One example is the La Parota hydroelectric dam in Guerrero, Mexico which would displace around 25,000 people and has currently been halted due to popular resistance. A group of 43 grassroots organizations met prior to the IDB meeting in Medellin. They presented studies and testimonies on the impacts of these projects in an effort to change the IDB's policies. Through the campaign known as "The IDB: 50 years financing inequality," these groups argue that, rather than alleviate the issue of poverty, mega-projects channel the profits gained from natural resources into the hands of the private sector and destroy the social fabric and community networks necessary for indigenous survival.

The solution to poverty that the IDB fundamentally proposes would seem to be: reduce poverty by expelling the poor. The two meetings—that of the IDB authorities and that of the organizations which question its practices—present an opportunity to revise the concept of development and move toward a fairer development model.

Originally posted on April 1, http://americas.irc-online.org/am/6008.

Not Quite Beyond Petroleum

Posted by Philip Mattera on February 20th, 2009

For the past eight years, the oil giant formerly known as British Petroleum has tried to convince the world that its initials stand for “Beyond Petroleum.” An announcement just issued by the U.S. Environmental Protection Agency may suggest that the real meaning of BP is Brazen Polluter.

The EPA revealed that BP Products North America will pay nearly $180 million to settle charges that it has failed to comply with a 2001 consent decree under which it was supposed to implement strict controls on benzene and benzene-tainted waste generated by the company’s vast oil refining complex in Texas City, Texas, located south of Houston.  Since the 1920s, benzene has been known to cause cancer.

Among BP’s self-proclaimed corporate values is to be “environmentally responsible with the aspiration of ‘no damage to the environment’” and to ensure that “no one is subject to unnecessary risk while working for the group.” Somehow, that message did not seem to make its way to BP’s operation in Texas City, which has a dismal performance record.

The benzene problem in Texas City was supposed to be addressed as part of the $650 million agreement BP reached in January 2001 with the EPA and the Justice Department covering eight refineries around the country. Yet environmental officials in Texas later found that benzene emissions at the plant remained high. BP refused to accept that finding and tried to stonewall the state, which later imposed a fine of $225,000.

In March 2005 a huge explosion (photo) at the refinery killed 15 workers and injured more than 170. The blast blew a hole in a benzene storage tank, contaminating the air so seriously that safety investigators could not enter the site for a week after the incident.

BP was later cited for egregious safety violations and paid a record fine of $21.4 million. Subsequently, a blue-ribbon panel chaired by former secretary of state James Baker III found that BP had failed to spend enough money on safety and failed to take other steps that could have prevented the disaster in Texas City. Still later, the company paid a $50 million fine as part of a plea agreement on related criminal charges.

In an apparent effort to repair its image, BP has tried to associate itself with positive environmental initiatives. The company was, for instance, one of the primary sponsors of the big Good Jobs/Green Jobs conference held in Washington earlier this month. Yet as long as BP operates dirty facilities such as the Texas City refinery, the company’s sunburst logo, its purported earth-friendly values and its claim of going beyond petroleum will be nothing more than blatant greenwashing.

Originally posted at:

http://dirtdiggersdigest.org/archives/327

Dirt Diggers Digest is written by Philip Mattera, director of the Corporate Research Project, an affiliate of Good Jobs First.

Norway finds Canada's largest publicly-traded company, Barrick Gold, unethical

Posted by Sakura Saunders on February 2nd, 2009
protestbarrick.net

Norway's Ministry of Finance announced Friday that it would exclude mining giant Barrick Gold and U.S. weapons producer Textron Inc from the country's pension fund for ethical reasons.  This is an especially significant judgment for Canada, as Barrick Gold is currently Canada's largest publicly traded company.

While the Norwegian Council of Ethics full recommendation mentions conflicts involving Barrick in Chile, Tanzania, and the Philippines, the panel acknowledged that, "due to limited resources," it restricted its investigation of Barrick to the Porgera mine in Papua New Guinea.  The Porgera mine has been a prime target for criticism for its use of riverine tailings disposal, a practice banned in almost every country in the world.

"It's unbelievably embarrassing," admitted Green Party deputy leader Adriane Carr. "It's got to be bad news for Canada when a foreign government says it's going to sell its shares in a Canadian company they figure is unethical."

This isn't the first time that Norway's Fund has divested from a gold mining company. In fact, looking at a list, the fund – with the notable exception of Walmart – divests exclusively from mining (primarily gold mining) corporations and corporations that produce nuclear weapons or cluster munitions... an interesting juxtaposition highlighting the comparable nature of mining to the production of weapons of mass destruction, especially in terms of long-term environmental consequences.

Compare that to Canada's treatment of gold mining companies. Just this last December, Peter Munk, the chairman and founder of Barrick Gold, received the Order of Canada, Canada's highest civilian honor. Additionally, within Toronto he is honored as a philanthropist, with the Peter Munk Cardiac Center and the Munk Centre for International Studies at the University of Toronto both adorning his name. Similarly, Ian Telfer, the chairman of Goldcorp, the world's second largest gold miner behind Barrick, has the Telfer School of Management at the University of Ottawa bearing his name.

These symbolic gestures, along with the fact that several Canadian Pension funds and even Vancouver-based "Ethical Funds" are still heavily invested in Barrick Gold, show that Canada has a long way to go in demanding that its companies honor human rights and halt its colonial-style, exploitative economic regime. In fact, by its own admittance, Canada's Standing Committee on Foreign Affairs and International Trade stated that "Canada does not yet have laws to ensure that the activities of Canadian mining companies in developing countries conform to human rights standards, including the rights of workers and of indigenous peoples." Since the date of that landmark confession, Canada has yet to adopt any intervening structures (like an ombudsperson) or develop any mandatory regulations for Canadian companies operating abroad.

Gold mining produces an average of 79 tons of waste for every ounce of gold extracted, 50 percent of it is carried out on native lands, and about 80 percent of it is used for jewelry, according to the "No Dirty Gold" campaign, a project of Oxfam and Earthworks. It is no wonder that in a portfolio with plenty of human rights abuses, the Norwegian Pension Fund decided to concentrate on gold miners, cluster munition manufacturers and nuclear weapon producers first. It is time that the rest of the world catch up.

Popular Uprising Against Barrick Gold in Tanzania sparked by killing of local

Posted by Sakura Saunders on December 14th, 2008
ProtestBarrick.net

Why would "criminals" set fire to millions worth in mine equipment?

How was it that these "intruders" had an estimated 3,000 - 4,000 people backing them up?

In what appears to be a spontaneous civilian movement against Barrick Gold, the world's largest gold miner, thousands of people invaded Barrick`s North Mara Gold Mine this week in Tarime District and destroyed equipment worth $15 million. Locals say that the uprising was sparked by the killing of a local, identified as Mang'weina Mwita Mang'weina.  According to a Barrick Public Relations officer (as reported by the Tanzanian Guardian newspaper), "the intruders stoned the security personnel relentlessly until they overpowered them. The guards abandoned their posts and retreated to safety."

While Barrick implies that "high levels of crime" are the cause of this recent outbreak, recent reports suggest a different picture.

Allan Cedillo Lissner, a photojournalist who recently documented mine life near the North Mara mine, explains:

Ongoing conflict between the mine and local communities has created a climate of fear for those who live nearby. Since the mine opened in 2002, the Mwita family say that they live in a state of constant anxiety because they have been repeatedly harassed and intimidated by the mine's private security forces and by government police. There have been several deadly confrontations in the area and every time there are problems at the mine, the Mwita family say their compound is the first place the police come looking. During police operations the family scatters in fear to hide in the bush, "like fugitives," for weeks at a time waiting for the situation to calm down. They used to farm and raise livestock, "but now there are no pastures because the mine has almost taken the whole land ... we have no sources of income and we are living only through God's wishes. ... We had never experienced poverty before the mine came here." They say they would like to be relocated, but the application process has been complicated, and they feel the amount of compensation they have been offered is "candy."

Evans Rubara, an investigative journalist from Tanzania, blames this action on angry locals from the North Mara area who are opposed to Barrick's presence there. "This comes one week after Barrick threatened to leave the country based on claims that they weren't making profit," comments Evans after explaining that Barrick does not report profit to avoid taxes in the country. "This is a sign to both the government of Tanzania and the International community (especially Canada) that poor and marginalized people also get tired of oppression, and that they would like Barrick to leave."

Only one week prior, Barrick's African Region Vice President, Gareth Taylor threatened to leave Tanzania due to high operating costs, claiming that the company did not make profits there. Barrick's Toronto office quickly denied this report, stating that "the company will work with the government to ensure the country's legislation remains 'competitive with other jurisdictions so that Tanzanians can continue to benefit from mining.'"

Interestingly, Taylors threat came shortly after he attended a workshop to launch the Extractive Industries Transparency Initiative (EITI) in Dar es Salaam.

One thing is clear, though; these reports of hundreds, backed by thousands, of villagers attacking mine infrastructure reflects a resentment that goes beyond mere criminal action. And this surge in violence should be examined in the context of the on-going exploitation and repressive environment surrounding the mine.

James Bond Takes on the Corporate Water Privateers

Posted by Jeff Conant on December 10th, 2008

Spoiler Alert!

Back in the good old days of the Cold War, everybody’s favorite secret agent, James Bond, fought villains like Dr. No, an evil scientist out to sabotage U.S. missile tests, and Mr. Big, a Soviet agent using pirate treasure to finance espionage in America. But as Bond’s friend Mathis tells him in Quantum of Solace, released this month, “When one is young, it’s easy to tell the difference between right and wrong. As one gets older, the villains and heroes get all mixed up.”

The reference is to a shady new Bond villain, agent of the Quantum organization – one Dominic Greene. In public, Greene is a leading environmentalist whose organization, Greene Planet, buys up large tracts of land for ecological preserves. But behind the scenes, Greene has another agenda. As he says to his co-conspirators, “This is the most valuable resource in the world and we need to control as much of it as we can.”

The film makes a number of plays on the assumption that the resource in question is oil – but oil is so…twentieth century.

By the time Bond has pursued Greene from Italy to Haiti, from Haiti to Austria, and crash-landed his plane in a sinkhole in the high, barren desert of Bolivia, we make the discovery that this vital resource is – surprise! – water.

Colluding with Greene is a cast of evil characters taken straight from the history books. We have General Medrano, the ex-dictator of Bolivia, to whom Greene says, “You want your country back? My organization can give it to you.” We have the U.S. Ambassador, myopically sticking to the familiar program: “Okay, we do nothing to stop a coup, and you give us a lease to any oil you find.” And we have the British foreign office, continually wrangling with M15, Bond’s spy agency. When Bond’s boss, M, tells him that Greene is not an environmentalist but a villain, the Foreign Minister says, “If we refused to do business with villains, we’d have almost no one to trade with.”  Ain’t it the truth.

The fact that Quantum of Solace makes water the villain’s object of greed, replacing oil, gold, diamonds, and mutually assured destruction, is telling of the point we’ve reached. More telling still is the fact that our villain’s cover has him acting as an environmentalist, the ultimate corporate greenwasher. The fact that the action winds up in Bolivia – the country where, in real life, both Bechtel and Suez have tried and failed to take control of community water resources during and shortly after the reign of former-dictator-turned-neoliberal President Hugo Banzer – brings the plot frighteningly close to reality. The privatization of water in Bolivia back in 2000, and the massive popular response that turned out rural water stewards and urban ratepayers to riot for months until the multinational transgressor was ousted, was the spark that set social movements worldwide on red alert. Since then, numerous private water companies have been refused contracts on the grounds that popular movements, and, increasingly, governments, recognize the need to treat water as a human right and a public good – not a commodity.

If only the water movement had a few organizers with the physique, the gadgets, and the, er, style of Bond.

While we have many great documentaries telling the story of the global water wars, including this year’s Flow and Blue Gold, one is forced to wonder if 007 does a greater service to the water movement than even our most highly talented documentarians. After all, who better than Hollywood to characterize the greenwashing corporate water profiteers as straight up evil, sans the need to justify the hyperbole?

Matieu Amalric, the actor who played Dominic Greene, wanted to wear make-up for the role, but director Marc Forster “wanted Greene not to look grotesque, but to symbolize the hidden evils in society.” Similarly, the original screenplay had Greene having some “hidden power.” But in the final cut, the director seems to have decided that corporate power was power enough.

One wonders if Dominic Greene – had he not died drinking motor oil to quench his thirst in the Bolivian desert – might give the keynote speech at the upcoming World Water Forum in Istanbul (WWF). After all, the World Water Council (WWC) that puts on the forum is presided over by Loïc Fauchon, a former executive at one of the French subsidiaries of Suez, the world’s largest private water corporation.

As we learn from the WWF website, “One of the benefits of joining the WWC is the Council's ability to influence decisions related to world water management that affect organizations, business, and communities.” Perhaps their secret meetings will also be attended by executives of the Worldwide Fund for Nature, whose recent partnership with Coca-Cola aims to help the global soft-drink giant become “the most efficient company in the world in terms of water use,” with “every drop of water it uses…returned to the earth or compensated for through conservation and recycling programs.” And, with this blending of fact and fiction, it would hardly be surprising to find Greene’s signature on the CEO Water Mandate, which has companies with such devastating environmental track records as Dow Chemical, Shell Oil, Unilever, and Nestlé pledging to “help address the water challenge faced by the world today.”

When M, Bond’s overweening boss at M15, finds out about Quantum, she demands, “What the hell is this organization, Bond? How can they be everywhere and we know nothing about them?”

Well, my darling M, the answer is simple: like transnational corporations, and like the large NGO’s that work with the private sector to reform its practices and green its reputation, and like the International Finance Institutions whose interests are increasingly endangering the United Nations’ mandate to defend and protect human rights, they can be everywhere because their particular form of villainy works best when hidden in plain sight.

Thankfully, the world’s water is safe, because, behind the scenes, secret agent 007 is on the job.

Well, not true. But countless people and organizations worldwide, from the Red Vida to the African Water Network, from the People’s Health Movement to the Reclaiming Public Water Network, are vigilant in the defense of the human right to water. With the recent placement of water warrior Father Miguel D’Escoto, a Nicaraguan liberation theologian, in the presidential seat at the UN General Assembly, and his selection of Maude Barlow as a senior advisor on water, we are witnessing a tidal change in the highest levels of international cooperation.

They may not have the brutal take-no-prisoners attitude or the classy cocktail swagger of Mister Bond, but they represent a lot of people, and they’re on the right side.

So, corporate evil-doers, and your greenwashing NGO henchmen, beware. The forces of good are on the loose.

Originally posted at Food & Water Watch:

http://www.foodandwaterwatch.org/blog/archive/2008/11/20/james-bond-takes-on-the-corporate-water-privateers/view

Giant Mining Firm’s Social Responsibility Claims: Rhetoric or Reality?

Posted by Philip Mattera on August 1st, 2008

The recent decision by the U.S. Supreme Court to slash the damage award in the Exxon Valdez oil spill case and the indictment of Sen. Ted Stevens on corruption charges are not the only controversies roiling Alaska these days. The Last Frontier is also witnessing a dispute over a proposal to open a giant copper and gold mine by Bristol Bay, the headwaters of the world’s largest wild sockeye salmon fishery. Given the popularity of salmon among the health-conscious, even non-Alaskans may want to pay attention to the issue.

The Pebble mine project has been developed by Vancouver-based Northern Dynasty Ltd., but the real work would be carried out by its joint venture partner Anglo American PLC, one of the world’s largest mining companies. Concerned about the project and unfamiliar with Anglo American, two Alaska organizations—the Renewable Resources Coalition and Nunamta Aulukestai (Caretakers of the Land)—commissioned a background report on the company, which has just been released and is available for download on a website called Eye on Pebble Mine (or at this direct PDF link). I wrote the report as a freelance project.

Anglo American—which is best known as the company that long dominated gold mining in apartheid South Africa as well as diamond mining/marketing through its affiliate DeBeers—has assured Alaskans it will take care to protect the environment and otherwise act responsibly in the course of constructing and operating the Pebble mine. The purpose of the report is to put that promise in the context of the company’s track record in mining operations elsewhere in the world.

The report concludes that Alaskans have reason to be concerned about Anglo American. Reviewing the company’s own worldwide operations and those of its spinoff AngloGold in the sectors most relevant to the Pebble project—gold, base metals and platinum—the report finds a troubling series of problems in three areas: adverse environmental impacts, allegations of human rights abuses and a high level of workplace accidents and fatalities.

The environmental problems include numerous spills and accidental discharges at Anglo American’s platinum operations in South Africa and AngloGold’s mines in Ghana. Waterway degradation occurred at Anglo American’s Lisheen lead and zinc mine in Ireland, while children living near the company’s Black Mountain zinc/lead/copper mine in South Africa were found to be struggling in school because of elevated levels of lead in their blood.

The main human rights controversies have taken place in Ghana, where subsistence farmers have been displaced by AngloGold’s operations and have not been given new land, and in the Limpopo area of South Africa, where villagers were similarly displaced by Anglo American’s platinum operations.

High levels of fatalities in the mines of Anglo American and AngloGold—more than 200 in the last five years—have become a major scandal in South Africa, where miners staged a national strike over the issue late last year.

Overall, the report finds that Anglo American’s claims of social responsibility appear to be more rhetoric than reality.  Salmon eaters beware. 

http://dirtdiggersdigest.org/archives/148

Dirt Diggers Digest is written by Philip Mattera, director of the Corporate Research Project, an affiliate of Good Jobs First.

Disclosure Issues Bedevil Climate-Change Debate

Posted by Philip Mattera on July 8th, 2008


Big business is talking more these days about the need to reduce greenhouse gas (GHG) emissions. Even long-time global warming denier Exxon Mobil feels the need to publicize what it is doing in this regard. Claims of reductions in GHG are not, however, meaningful unless those emissions are being estimated consistently to begin with.

A study issued yesterday by the Ethical Corporation Institute raises questions about how much we really know about the volume of GHG being generated by large corporations. According to a press release about the report (which is available only to those willing to fork over more than 1,000 euros), there are “staggering inconsistencies in how companies calculate and verify their greenhouse gas emissions.” The report found, for instance, that companies responding to the fifth annual Carbon Disclosure Project questionnaire used more than 30 different protocols or guidelines in preparing their emissions estimates. The report, it appears, surveys this potpourri of measurement techniques but does not attempt to resolve the differences.

The absence of consistency has not prevented the Carbon Disclosure Project from trying to use current reporting to understand the larger framework of GHG trends. In May, the Project issued the first results of its Supply Chain Leadership Collaboration, an initiative in which large companies such as Nestlé, Procter & Gamble and Unilever urge their suppliers to report on their own carbon footprint. It is unclear how much effort is made to ensure these results are reported in a uniform manner.

Along with the need for improved GHG reporting, there are growing calls for companies to disclose the liability risks (and opportunities, if any) associated with those emissions. Recently, a broad coalition of institutional investors and major environmental groups once again urged the U.S. Securities and Exchange Commission to clarify the obligations of publicly traded companies to assess and fully disclose the legal and financial consequences of climate change. The statement was aimed at reinforcing a petition filed with the SEC last year on climate-change disclosure.

Climate-change liability risks no longer exist just in the realm of the theoretical. Lawsuits have been filed against the major oil companies for conspiring to deceive the public about climate change—including one brought in the name of Eskimo villagers in Alaska who are being forced to relocate their homes because of flooding said to be caused by global warming.  Famed climate scientist James Hansen recently declared at a Capitol Hill event that oil and coal company executives could be guilty of “crimes against humanity.” If that isn’t a risk worth reporting, what is?

http://dirtdiggersdigest.org/archives/99

Dirt Diggers Digest is written by Philip Mattera, director of the Corporate Research Project, an affiliate of Good Jobs First.

Bye, American

Posted by Mark Floegel on March 19th, 2008


You might have heard the story about General Motors Vice Chairman Bob Lutz. At a recent closed-door meeting with reporters, the 76-year-old, who’s in charge of product development said he thinks global warming theory is “a total crock of sh*t” and that hybrid cars “make no economic sense.”

As you might expect, the people who cover both the auto industry and the environment went nuts. Mr. Lutz eventually responded to the uproar with a post on GM’s blog site (or at least a 26-year-old administrative assistant posted a response for him).

In the blog, Mr. Lutz called his remarks “an offhand comment.” “But I think that the people making a big deal out of it are missing the real point,” he wrote. “My beliefs are mine and I have a right to them, just as you have a right to yours.”

I don’t think anyone’s questioning Mr. Lutz’s right to have an opinion. I think, instead, when Mr. Lutz was kind enough to treat the world to his unvarnished thoughts, we all had an “Aha!” moment explaining why Toyota is overtaking GM as the world’s largest automaker.

Hybrid vehicles “make no economic sense” to Mr. Lutz, who undoubtedly basks in a bloated bath of cash thanks to his salary ($8 million per year), bonus and perks, but the for rest of us poor schmucks, trying to pony up what will soon be four dollars per gallon at the pump, hybrid cars make a world of economic sense and again, explains why Toyota is eating Mr. Lutz’s lunch.

“Instead of simply assailing me for expressing what I think, they should be looking at the big picture,” Mr. Lutz wrote. “What they should be doing, in earnest, is forming opinions not about me but about GM, and what this company is doing that is — and will continue to be — hugely beneficial to the very causes they so enthusiastically claim to support.”

Really? As fate would have it, I’ve driven three rental cars in the past week. One was a Hyundai Sonata, one a Dodge Avenger and one a Chevrolet Cobalt, from Mr. Lutz’s beloved GM.

The Cobalt was – to paraphrase Bob Lutz – a total piece of sh*t. It was cramped, handled poorly; the interior was made of such cheap plastic that I was afraid I’d a) die from off-gas fumes or b) snap off the handle when I went to open the door. The icing on this cake of deficiency was the fact that the little monster sucked down gas like a fleet of overloaded semis. Yet another wonderful product from GM, polluting the atmosphere and making people poor and miserable while it careens toward an early grave in the junkyard. Thanks, Bob.

My favorite – by far – was the Hyundai. It was comfortable, roomy, responsive and got decent gas mileage. The Dodge fell somewhere in between.

Mr. Lutz wrote, “My opinions on the subject [of global warming] — like anyone’s — are immaterial. Really.”

Really? GM pays you eight million dollars a year and doesn’t give a sh*t (I hate to keep using this word, but you brought it up, Bob) what you think?

And, really? Everyone’s opinion on global warming is immaterial? Perhaps that’s true. No one’s opinion counts except that of the decider, George W. Bush and he’s decided we need to keep pumping oil and mining coal.

Bob Lutz is a walking embodiment of what’s wrong with America’s industrial policy. He’s got his head so far up his own ass that everything looks like a crock of sh*t to him. Someone find this bozo a gold watch and let’s get on with trying to save ourselves from the internal combustion engine.

http://markfloegel.org/2008/03/06/bye-american/ 

Cowboy Capitalism: Chinese Companies in Africa

Posted by Amelia Hight on October 10th, 2007

Transit riders switching trains at the Montgomery BART subway station in downtown San Francisco will find it difficult to miss the new ads covering the walls, the floor and even the stairs with pictures of Sudanese refugees. The advertisements' message is attention catching: "Are you invested in genocide?" As part of the Save Darfur Coalition's Divest for Darfur campaign, the ads urge transit users to visit their website, where they are asked to demand that investment firms - specifically JP Morgan, Franklin Templeton, Fidelity Investments, Capital Group (American Funds), and Vanguard - withdraw investments from companies like the Chinese National Petroleum Corporation (CNPC), which are, according to the website, "filling the coffers of the Sudanese government and helping fund the government's actions in Darfur." (As a side note, the use of the term "genocide" by groups like Save Darfur to describe the conflict in Sudan is highly controversial. For more information, read the transcript of Professor Mahmood Mandani's June 4th interview with Amy Goodman on Democracy Now!, titled "The Politics of Naming: Genocide, Civil War, Insurgency."

­ The CNPC has been heavily censured for continuing to do business in Sudan, despite the ongoing conflict there. Attempting to place pressure on firms invested in the state-owned CNPC, rather than on the CNPC itself, is a way for activists to circumvent the "no strings attached" stance of the Chinese government toward investment in Africa and other parts of the world. China prides itself on having a different approach to investment than western lending organizations like the World Bank or IMF, which have numerous development and human rights stipulations attached to investments. In Sudan, this means that the government doesn't have to bend to international pressure to, say, allow UN troops into Darfur. Many African governments welcome Chinese investment specifically because of this hands-off approach. In a recent article in the New York Times, Lydia Polgreen comments on the increasing presence of Chinese companies in Africa, especially in the rich natural resources and mining sector. Manganese mines in South Africa, uranium pits in Nigeria and cobalt mines in the Congo are all areas of investment for state-owned Chinese companies, like the Nonferrous Metals Corporation.

African citizens view Chinese investment with ambivalence. Some see economic relationships with China as a source of much needed income and a step up from paternalistic relationships with the West. "Let the Chinese come," said Mahamat Hassan Abakar, a lawyer in Chad. "What Africa needs is investment. It needs partners. All of these years we have been tied to France. Look what it has brought us." Others are more critical, seeing China as just another country robbing Africa of its resources and in the process enriching local elites, bolstering repressive governments and perpetuating Africa's secondary economic status. Cheap Chinese goods flooding Africa inhibit local manufacturing and the jobs that accompany it. Unsafe working conditions lead to industrial accidents like the 2005 blast at a Chinese-owned explosives factory in Chambishi, Zambia, which killed 51 people.

The investment of Chinese state-owned companies in Africa is hardly a win-win situation, but it is easy to recognize the attraction for African governments doing business with Chinese companies. In judging if China is a partner or colonizer in Africa, the answer is probably, a little of both.

2008 Public Eye Awards

Posted by Pratap Chatterjee on September 27th, 2007

Which are the world's worst multinationals? Which are the best? These are questions CorpWatch gets asked practically everyday. Just to clarify, we do not rank good corporations or endorse any of them, for several reasons: today's idols sometimes turn out to have feet of clay. And we see our job as investigators of malfeasance. For those who want to do the opposite, there are plenty of groups out there who promote "socially responsible" businesses, and we encourage you to look them up. (We don't have a list of these groups for the aforementioned reasons, but we do have a guide to the principles that we believe good businesses should follow -- and we leave it to you, our gentle readers, to apply this criteria to evaluate corporations.)

(We strongly believe that it is very important not to take corporate claims at face value, because sometimes these companies are not telling the whole truth. This is known as "greenwash" and to see a history of this phenomenon, we urge you to check out our short history of the subject, in this handy guide written by Josh Karliner, the founder of CorpWatch.)

Today, there is an opportunity for you to get your favorite (or maybe, least favorite) multinational nominated for an award for corporate malfeasance -- the Berne Declaration and Friends of the Earth Switzerland are holding its fourth annual award ceremony in January 2008, to coincide with the annual gathering of Fortune 500 chieftains in Davos. You can take part in this contest by clicking here

(Previous winners from 2005, 2006 and 2007 are available online.)

If you have questions, contact Oliver Classen who is coordinating the awards ceremony.

In case you are wondering, how do you find out whether companies are telling the truth? Well, here's a tip -- there's a group in the Netherlands that collects these reports: the Global Reporting Intitiative. You can even search their database to look up your favorite/least favorite company. GRI is about to launch a tool on October 1st, 2007 that will allow you to rank these reports -- if you are so inclined.

Read the reports, search our website and that of Multinational Monitor, and then contact groups on the ground to see if these companies are telling the truth or not.

Remember the deadline to nominate a company for the Public Eye on Davos award is September 30th, 2007!

Digging for Dirt in the DRC?

Posted by Amelia Hight on July 25th, 2007

Billy Rautenbach, a South African mining kingpin, was deported from Lubumbashi airport in the Democratic Republic of Congo (DRC) on July 18th. “He was accused of fraud, theft, corruption and violating commercial law [the expulsion document] said. He was persona non grata. He would have to leave,” writes Ben Laurence in the Sunday Times (UK).

Best known in South Africa and Botswana for his activities in assembling Hyundai cars, Rautenbach faces hundreds of charges of fraud, corruption and other crimes in his home country of South Africa (the reasons cited in the documents prepared for his deportation last week). South Africa is currently considering asking Zimbabwe to extradite him to stand trial.

But Rautenbach was also once a powerful man in the DRC. He ran Gecamines, the DRC’s state-owned copper mining company, from 1998 to 2000. At the time he was accused of under-reporting exports of sales of huge quantities of DRC cobalt when he was in charge – and diverting the profits to a company he controlled in the British Virgin Islands.

Although Rautenbach lost his job, he continues to play an important role in the mining sector, as he also happens to be a major shareholder of Central African Mining & Exploration Company (CAMEC), which won major contracts in the DRC a couple of years later.

CAMEC’s contracts were the result of an investor-friendly mining code introduced by the World Bank in July 2002. (An informative analysis of this code was done by the Bank Information Center.) While the code calls for a much-needed regulatory framework and environmental protection, it hands the responsibility for mining development to private companies.

However, it is doubtful that the Congolese public institutions charged with regulating the mining sector have the resources to carry through with it, and the World Bank certainly has not been successful in providing oversight. A memo leaked to the Financial Times in November 2006 details the World Bank’s failure to provide sufficient oversight in three major contracts made between Gecamines and international mining groups like CAMEC. Worth billions of dollars, these contracts reportedly gave these groups control over 75% of Gecamines mineral reserves. (In May 2007, the Financial Times also revealed that the World Bank withheld the findings of an inquiry into alleged mismanagement of funds in the Democratic Republic of Congo.) 

More details on the business dealings of Rautenbach and CAMEC may emerge from a DRC commission that recently began a three-month review of mining contracts signed in the last decade. The commission is the first attempt of a new “democratically elected” government to investigate ongoing corruption in the DRC’s valuable mining sector. The new commission follows a string of attempts by previous governments and international financial institutions to investigate the exploitation of natural resources in the DRC.

If the commission hopes to be successful it must take a look at whose interests are being promoted/protected in the Congo and how. This would include an investigation into local elites, regional influences, international financial institutions and the powers they represent, and international corporations along with the relationships between these different actors.

History has shown that the more resources a nation or region possess, the more conflict and poverty the people of that nation are forced to endure. The DRC is the third largest country in Africa and is rich in natural resources, particularly cobalt, copper, diamonds and gold. It is home to one third of the world’s cassiterite, the most important source of the metallic element tin and holds 64-80% of the world’s coltan reserves, an ore that is the source of the metal tantalum, which is used in cell phones and other devices.

In an article for Alternet, Stan Cox quotes a miner responsible for digging the valuable cassiterite:  "As you crawl through the tiny hole, using your arms and fingers to scratch, there's not enough space to dig properly and you get badly grazed all over. And then, when you do finally come back out with the cassiterite, the soldiers are waiting to grab it at gunpoint. Which means you have nothing to buy food with. So we're always hungry." This cassiterite will inevitably end up in cheap cell phones and laptops laying abandoned in American landfills.

Despite (or indeed because of) its abundance of resources, the DRC has been plagued by conflict, famine and political instability since its independence in the 1960s. Following the end of the 30-year dictatorship of Mobutu Sese Seko (who was brought to power by the U.S. in the 1960s), the greed of neighboring countries for natural resources forced the DRC into the center of what organizations like Human Rights Watch have deemed, “Africa’s first world war.”  The war resulted in the death of three to five million people, many from famine, exposure and disease.

A cease-fire ended the war in 1999, but the DRC has continued to suffer the extraction of resources and wealth through corrupt deals between local elites and international companies. A 2006 report from the London-based watchdog organization, Global Witness, describes how copper and cobalt are mined informally and illicitly exported,  robbing the Congolese people of any opportunity to reduce poverty.

The new commission’s plan to revisit mining contracts between the state and private companies is a response to years of domestic and international pressure. Hopefully, once the review is completed (assuming that it is a transparent and non-corrupt process), the international companies involved will be willing to re-negotiate contracts in a way that is more beneficial to the Congolese state and its citizens. An interesting precedent was established last year in Liberia when Mittal Steel, the world’s largest steel company, agreed to step down from an unbalanced concessionary agreement made with a corrupt transitional government once a democratically elected government was in place.

Alcan pulls out of Utkal project in India

Posted by François Meloche on April 16th, 2007
Groupe Investissement Responsable Inc. (Montreal)

Alcan, a Canadian company, has decided to sell its 45 percent stake in Utkal Alumina International Limited, a company aiming to produce alumina in the state of Orissa in India. Alcan had been under pressure for years to withdraw or at least ensure the project had obtained the free prior and informed consent of local communities.

Community members, mostly "scheduled tribes" Adivasis, have opposed the Utkal project, to protect their right to control local resources and avoid environmental damage. The project, which is in its "engineering phase" has already started to displace the 200 or so families living on the site of the future alumina plant. Herders and others would also be affected by the mining operation. It is unclear how many people would be affected but some critics have estimated that over 10,000 people would suffer. At least 23 villages would be affected by the project.

In December, 2000, police in Kashipur opened fire on protesters opposed to the Utkal mine and smelter, killing three people. One of the partner at that time, Norsk Hydro of Norway, immediately pulled out and sold its share to Alcan.

Activists from Alcan't in India, a solidarity group based in Montreal, Quebec, Canada, are pressuring Alcan to compensate people whose "lives have been ruined through jailings, beatings, displacement, and even death due to Alcan’s involvement."

Last year, Alcan promised it would provide an answer to shareholder activists by March 2007 on its involvement in the project. Shareholders had filed a proposal (see 'Tis the Season for Shareholder Activism) asking for an independent study on the consent of the community, a proposal that received a surprisingly high 37 percent. (Similar resolutions typically get between zero and ten percent. Any resolution that scores in the higher end of that range is taken seriously by management)

The Indian partner in the Utkal project, Hindalco, the industrial division of the Indian conglomerate Aditya Birla group, which owns 55% of the project, has not given any indication that it will change its plans.

Alcan, on the other hand, invests a lot of money in public relations to promote  its sustainability strategy, has portrayed itself as a minority partner that does not participate in the real decision making around this project.

“We have carefully weighed the opportunity and risk presented by the Utkal Project, and, given constraints within the governance structure that limit Alcan's ability to participate in key decisions, believe that we have acted in the best interests of all our stakeholders,” Jacynthe Côté, president and chief executive officer of Alcan Bauxite and Alumina, said in a statement.

Alcan says it will keep a commercial interest in the project by continuing to "benefit from an Alcan technology supply agreement", according to the Alcan press release, but it does not give further details.

Editor's note: The decision of Alcan to pull out of the Utkal smelter reflects similar dissatisfaction over aluminum smelters around the world. Sujatha Fernandes reported for us from Trinidad on a similar project in the Chatham/Cap-de-Ville area (see “Smelter Struggle: Trinidad Fishing Community Fights Aluminum Project") that was canceled in January 2007 although the Alcoa is now hoping to get permission to relocate the project to Otaheite Bay, which also serves as a nesting ground for the scarlet ibis, one of Trinidad and Tobago's national birds, as well as 36 other avian species.

And communities in Iceland have also been battling a proposed Alcoa smelter, for which the gigantic $3 billion Karahnjukar dam, north of Vatnajokull, Europe's biggest glacier, is being built. The Guardian did a great story ("Power Driven") on this in 2003, and the New York Times recently did a feature on what it called the angriest and most divisive battle in recent Icelandic history. Updates can be found at the Saving Iceland website
.

Total Denial: Burmese peasants fight Unocal

Posted by Pratap Chatterjee on March 20th, 2007

Continuing our film recommendations from last week, we'd like to mention "Total Denial" - a new documentary on corporate-financed human rights abuses in Burma. The film was made by Bulgarian-born Milena Kaneva. The Austin-Chronicle newspaper in Texas called the film: "heart-wrenching and utterly disturbing."

"Total Denial" chronicles a major human rights lawsuit brought by EarthRights International and villagers from Burma against oil giant Unocal, a company based right here in California, as well as a French multinational named Total. A number of screenings are coming up in the next few weeks here in the U.S.  If you live in the Bay area, do check it out on Thursday, in Los Angeles on March 27th or in Washington DC on April 11th.

The lawsuit was brought by 11 Burmese peasants who suffered a variety of human rights violations at the hands of Burmese army units that were securing the pipeline route. These abuses included forced relocation, forced labor, rape, torture, and murder.

The case was spearheaded by Ka Hsaw Wa, the executive director of Earth Rights International, an organization based in Washington DC. Of the Karen indigenous minority in Burma, he was one of the student leaders in the 1988 nation-wide student uprising for democracy and freedom, and has been a human rights activist since he fled Burma in 1988. He was helped by Paul Hoffman of the Center for Constitutional Rights, Hadsell & Stormer, and Judith Brown Chomsky.

Almost a decade after the case was brought, the court decided that:
"Unocal knew that the military had a record of committing human rights abuses; that the Project hired the military to provide security for the Project, a military that forced villagers to work and entire villages to relocate for the benefit of the Project; that the military, while forcing villagers to work and relocate, committed numerous acts of violence; and that Unocal knew or should have known that the military did commit, was committing and would continue to commit these tortious acts."
The legal basis for the case was a laws called the Alien Tort Claims Act (a 1789 law intended to curb piracy on the high seas by extending U.S. jurisdiction to cover breaches of international law outside its borders), which has been used primarily to sue international human rights abuses in U.S. courts.  In recent years a number of plaintiffs have sued multinational corporations for abuses outside the U.S. under this law. While many of these cases are now in court, Unocal decided to settle out of court and compensate the victims in January 2006.

Earth Rights International are using the same law to pursue another major oil company here in California (Chevron) with some success for abuses in Nigeria.

The case is based on two incidents: the shooting of peaceful protestors at Chevron's Parabe offshore platform and the destruction of two villages by soldiers in Chevron helicopters and boats.

Last week U.S. District Judge Susan Illston in San Francisco agreed that the Nigerian plaintiffs: "have presented evidence of a link between the conduct of Chevron in the United States and the attacks in Nigeria at issue" as well as evidence that the corporation had substantial control over its Nigerian unit, that it  "designed and adjusted the general security policies and procedures" of its subsidiary and approved payments from the subsidiary to the Nigerian government security forces.


Incidentally, Earth Rights International is also pursuing a third Alien Tort Claims Act case against Shell in Nigeria for complicity in human rights abuses.

The particular abuses at issue are the November 10, 1995 hangings of Ken Saro-Wiwa and John Kpuinen, two leaders of MOSOP (Movement for the Survival of the Ogoni People), the torture and detention of Owens Wiwa, and the shooting of a woman who was peacefully protesting the bulldozing of her crops in preparation for a Shell pipeline by Nigerian troops called in by Shell.

The Curse of Gold

Posted by Sakura Saunders on February 28th, 2007


This week's CorpWatch feature
highlights the plight of indigenous people in Papua New Guinea, where landowners feel that they are cheated out of their resources, livelihoods, and just compensation by the world's largest gold producer, Barrick Gold.

Papua New Guinea represents a case study in how resource extraction just might be the worst possible way to develop a country, especially where 85 percent of the population depends on the environment for their subsistence livelihood. Here, the pollution caused by open-pit mining and cyanide leaching creates an especially vulnerable situation for the indigenous people. In our recent feature, we attached testimonies from the landowners, mine workers, women, and human right activists who are affected by the mine. A principal landowner, Nelson Akiko, describes his disillusionment with the mine:

We depend on our land. You depend on money. Money is not need, it is only a want, but it is need in western society. I live on land, which is my stomach. I grow food from this land and then I survive. But now, where can I get food?

Also, the fact that mineral deposits, including oil, copper, and gold, account for two-thirds of PNG's export earnings leaves them susceptible to the Dutch Disease, or the phenomenon wherein resource exports raise the exchange rate for a country's currency, thereby making their labor less desirable. While this only accounts for a tiny part of the negative consequences of mining, it does illustrate that even within an economic paradigm, mining carries negative consequences for 'development', especially open pit mines because they require less human labor. Large mineral exports also make countries more susceptible to corruption because of the negotiating power held with government gatekeepers.

This is similar to Mali, where gold makes up 65 percent of its exports, dwarfing its former economic bedrock cotton. Some 64 mining companies have active mining and exploration projects in this landlocked African country, but despite a surge in gold prices, Mali's development indicators have stagnated. A recent Oxfam report 'Hidden treasure: in search of Mali's gold mining revenues', concluded that:

"There is not sufficient disclosure in an understandable form for citizens or civic groups to determine whether they are indeed benefiting as they should according to current law in Mali."


The fact that gold is a largely useless metal (that is already hoarded and unused in large quantities) makes the destruction caused by it's extraction all the more tragic. According the No Dirty Gold Campaign, 80% of the gold is used by the jewelry industry. On average, the production of one gold wedding ring produces 20 tons of waste.

Unfortunately, Papua New Guinea is not an isolated example of how gold mines can destroy communities. Mining Watch Canada summed their view of the mining industry in Canada, where 60% of the world's mining companies reside:

Metal prices are booming, and Canadian mining companies are taking advantage of the same prejudicial conditions to expand into all corners of the globe, manipulating, slandering, abusing, and even killing those who dare to oppose them, displacing Indigenous and non-Indigenous communities alike, supporting repressive governments and taking advantage of weak ones, and contaminating and destroying sensitive ecosystems. 
CorpWatch has been tracking Barrick elsewhere in the world, most recently at its Pascua Lama project in Argentina.
Barrick's plans to "relocate" three glaciers - 816,000 cubic meters of ice - by means of bulldozers and controlled blasting, is seen by mine-opponents as symbolic of the company's utter insensitivity to the environment. As headwaters for a water basin in an arid region receiving very little rainfall, many opponents are gravely concerned for the ice. They say the mechanical action involved in moving the glaciers will irreversibly melt much of it, jeopardizing a delicate ecological balance further downstream.

While Barrick originally planned to "relocate" three glaciers to another area, since being denied their original plan, the project now aims to build an open-pit mine next to the glaciers. However, most alarmingly, since construction has started on the mine, the glaciers have been depleted an estimated 50-70 percent, according to Chilean General Office of Waters (DGA). Barrick attempted to blame global warming for the melting, but those claims have been disproven.


Mining in the U.S.

In the U.S., Western Shoshone lands now account for the majority of gold produced within the United States and almost 10 percent of world production. The scale of development is unprecedented and will leave a legacy of environmental impacts for centuries into the future.

An excellent article on the boom in gold mining from the Las Vegas Mercury News explains the predicament that Shoshone face. 

Bush Defends Mining Record

Posted by Brooke Shelby Biggs on January 23rd, 2006

From Reuters:

The Bush administration on Monday defended the government's oversight of the Sago mine and said none of the previous safety problems cited at the West Virginia mine appeared to be the cause of the Jan. 2 explosion that killed 12 miners.

That's sort of like an auto mechanic saying he forgot to tighten the bolts on a customer's car wheels after the tune-up, but the accident that killed him was a seat-belt issue. Just because the Bush administration never cited Sago for the safety issue that resulted in the tragedy doesn't mean it shouldn't have, or that the political coziness of the mining industry to the Bush camp might not have resulted in the oversight.

Not clear how this makes Bush look better: Yep, all of the citations we issued were obviously not as serious as the one we should have!

Time Again to Expose a Mining Company's Safety Record

Posted by Brooke Shelby Biggs on January 20th, 2006

As we write this, two more miners are missing in West Virginia as the result of a fire inside a coal mine. This time, the company that owns the Mine is Massey Energy - a mining giant with one hell of a bad reputation in Appalachia.

In 2000, a coal waste reservoir operated by Massey in Kentucky sprung a leak and dumped 300 million gallons of toxic sludge into local tributaries of the Ohio River. The accident killed more wildlife and destroyed a larger geographical area that the Exxon Valdez oil spill, which amounted to "only" 11 million gallons of oil.

A young investigator named Jack Spadaro was sent by the Mine Safety and Health Agency to investigate the accident. Hew discovered that Massey had been fully aware of the reservoir's likelihood to fail, and yet did nothing. Instead, Massey had poured money into Republican campaign coffers, including Kentucky Senator Mitch McConnell's campaign committee and the Bush Cheney campaign. It just so happened that McConnell's wife, Elaine Chao was appointed Secretary of Labor after Bush's election. The MSHA is an agency within the Department of Labor. Furthermore, Bush appointed a former Massey executive to the MHSA's review committee which handles all legal issues related to the Coal Act.

Spadaro recommended that Massey be charged with criminal negligence. His superiors refused. And when Spadaro publicly questioned whether mine safety had been sold to the highest bidder under Bush, he was summarily fired.

Today, another huge Massey sludge pond at a Kentucky mine sits on a hill above an elementary school. Coal dust blankets the school yard. Neighbors want the pond decommissioned; in response Massey applied for and won permits to build coal silos even closer to the school.

The Citizens Coal Council says:

The company also regularly violates coal truck weight limits, sending monster trucks weighing 140,000–160,000 pounds hurtling through central Appalachia’s winding roads. These speeding, overweight trucks damage roads and kill, on average, four to six people a year in auto accidents. Recently Don Blankenship, Massey’s CEO, weighed in with his thoughts on killing innocent motorists:

“The truth of the matter is . . . four to six fatalities a year, with the number of miles coal trucks are traveling on these highways each year, is no worse than average.”

In addition to being openly anti-union (only 5 percent of Massey’s work force is represented by a union), Massey has been called one of the worst coal companies in America for miner safety by the United Mine Workers of America union, who also claim that the company uses contracted management to avoid paying workers’ compensation. Massey has been sued by its employees for overexposure to coal processing chemicals and has been investigated by the Mine Safety & Health Administration for chronic health and safety violations at its mines.


In the past 2 years, the Massey mine where yesterday's fire broke out was cited by the MSHA 204 times for safety violations, but paid less that $50,000 in fines.

So we have Sago, Part Two. Cronyism kills.

Mine Tragedy Spun as Profit Opportunity

Posted by CorpWatch on January 11th, 2006

Spectacular. Bad-boy investment celebrity Jim Cramer, host of CNBC's "Mad Money with Jim Cramer," actually recommended today investing in "mine-safety" stocks. Not because it is important for us as a country to pick up the slack left by a "paper tiger" federal mine safety agency, but because there could be lots of dough in it.

According to the blog Crooks and Liars, Cramer actually said ""we're not partisan here... we're just looking to make money, and the Bush Administration has been negligent." And why on earth not cash in?

There is simply something obscene about the very suggestion.

How Bush Rolled Back Mine Safety

Posted by CorpWatch on January 6th, 2006

With the same logic that dictates that logging is good for trees, the 5 years of the Bush Administration has rolled back regulations on mine safety at the bidding of mining corporations.

The head of the Mining Healthy and Safety Administration is himself a former mining executive. A New York Times article in August 2004 noted:

In all, the mine safety agency has rescinded more than a half-dozen proposals intended to make coal miners' jobs safer, including steps to limit miners' exposure to toxic chemicals. One rule pushed by the agency would make it easier for companies to use diesel generators underground, which miners say could increase the risk of fire.

The policy of the Bush Administration from the first has been to kowtow to energy interests, allowing them to tinker with the nation's energy policy, labor codes, and environmental protections in exchange for huge financial contributions to campaign coffers. Only today, in the wake of the Sago mine tragedy, we see how such policies can actually kill. And to think that West Virginia is a blood red state; perhaps not for long.