The court action faced by Harmony Gold’s subsidiary in Papua New Guinea was not surprising because most mining companies tended to overlook the effect and consequences of their activities on surrounding communities, said John Capel, CEO of a sustainability monitoring NGO, Bench Marks Foundation.
Harmony Gold and its Australian partner seem to have landed in hot water after trying to pay their way out of environmental damages attributed to their operation in Papua New Guinea.
The JSE-listed gold miner released a statement last week saying its mining operation in Morobe Province of Papua New Guinea, faces possible court action over sediment spillage from its Hidden Valley Mine joint venture. The sediment discharge seems to have caused environmental damage for communities along the Watut River. These damages include possible contamination of crops and home gardens.
Led by a parliamentary representative of the Bololo community and a number of land owners, the court action defies an arrangement whereby the operation called Hidden Valley Mine was to settle the matter through financial compensation to members of the affected communities.
Capel said of the effect and consequences of mining on local farmers: “This trend is growing here in South Africa and throughout the world. Disadvantaged communities are always worse off, with their livelihood getting destroyed.”
PCountries like Papua New Guinea probably had far less mining regulation compared to South Africa and were likely to see such conflicts emerging between prospectors and communities, he said.
“At stake is the communities’ way of life, kinship relations, cultural traditions, livelihoods and subsistence and agricultural farming,” he said.
Capel said mining companies “need to go beyond reporting and implement ethical standards that govern their relations with communities and ensure measurable local development indicators”.
“Much is said about the need to attract foreign investment and the benefits of mining, job creation, contribution to GDP and overall economic benefits associated with the extractive industries. Little is said about the negative impact on communities,” he said.
In its statement, Harmony Gold said: “The Hidden Valley Joint Venture denies allegations made against it in a writ, purportedly served upon the PNG Joint Venture companies.”
The joint venturers would vigorously defend the litigation should it proceed, said the Harmony statement. “The writ alleges nuisance relating to mine-related sediment and seeks damages and injunctive relief in relation to the Hidden Valley Mine operations,” said the statement.
The statement added that the writ was contrary to the agreement reached between the community and the joint venture, to resolve the matter “in a transparent and co-operative forum”.
Harmony said: “The issue and purported service of the writ by the member’s legal advisor appears to be prompted by voluntary compensation payments the joint venture is making to communities along the Watut River.”
The payments were for flood damage to crops and gardens to which mine-related sediment may have contributed, along with natural events like land slips and major rain events, said the statement.
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