C 68619 ASM Communities and Small-Scale Mining MINING TOGETHER A Guide for Action Large-Scale Mining meets Artisanal Mining Mining Together Large-Scale Mining Meets Artisanal Mining: A Guide for Action March 2009 © 2009 Communities and Small-scale Mining (CASM), The World Bank / International Finance Corporation Oil, Gas and Mining Sustainable Community Development Fund (CommDev). Photography: Photographs provided by Joseph Mbaya, Liz Wall, Charles Loots, and CASM secretariat. Disclaimer: The findings, interpretations, views and conclusions expressed herein are those of the authors and do not necessarily reflect the views of the Executive Directors of the International Bank for Reconstruction and Development (the World Bank), the International Finance Corporation (IFC) or of CASM organization supporters and partners. Nor do they necessarily reflect the views of the governments that the International Finance Corporation and the International Bank for Reconstruction and Development (the World Bank) represent. FOREWORD (3) Conflict is normal in the interaction between people, organizations, countries, and companies. It is neither inherently positive nor negative. And although conflict usually has negative connotations, it certainly also brings opportunities as well as challenges. Conflict can either be constructive or destructive. Which way it goes largely depends on how conflict is prevented, managed, and ultimately transformed. And that prevention, management, and transformation represent a shared responsibility of all major stakeholders. A crucial undertaking then is to understand the underlying issues of conflict, its dynamics and its norms, and to focus on the potential opportunities that a particular conflict offers in any situation. In this regard, the case of large-scale mining and artisanal miners is no different from other conflict- prone situations. The present guide Mining Together-When Large-scale Mining meets Artisanal Mining is an important step to better understanding the conflict dynamics and underlying issues between large- scale and small-scale mining. This guide for action not only points to some of the challenges that both parties need to deal with in order to build a more constructive relationship, but most importantly it sheds more light on some potential interventions for conflict prevention, management, and even transformation. This guide, then, represents a step in the right direction to start transforming the relationship between large-scale and artisanal miners through win-win solutions that emerge out of the genuine interaction and dialogue of all stakeholders involved: governments, companies, communities, miners and development organizations. In that context, the present guide is a relevant contribution that demonstrates that mining together is not only a dream, but can also be a reality. Paulo De Sa Manager Oil, Gas and Mining Policy Division The World Bank Group MINING TOGETHER / A Guide for Action (4) ACKNOWLEDGMENTS The production of this guide was made possible by the work of many individuals, and we are extremely grateful for their contributions. Among those who were involved at different stages of the review process, we would like to thank: Anne-Marie Fleury, ICMM ; Arjun Bhalla, CommDev ; Christopher Sheldon, CASM; John Nicholas Middleton, IFC; Justin Pooley, IFC; Kevin D’Souza, Wardell Armstrong; Liz Wall, Consultant; Mark Wall, Barrick Gold; Nerys John, De Beers; Paul Hollesen, AngloGoldAshanti; Robert Vanoi Gerrits, IFC; Sarah Ruck, IFC; Veronica Nyhan, CommDev; Veronika Kohler, CASM. As the drafting process was extensive and iterative, all the named persons above have not reviewed the final version of this guide. Some sections are based on an early draft provided by Wardell-Armstrong (Kevin D’Souza) in fall 2007. The guide was made possible by the financing support of CASM and CommDev. For further information, please contact the main authors: Remi Pelon, Mining Specialist, World Bank, rpelon@worldbank.org Gotthard Walser, CASM Program Manager, gwalser@worldbank.org MINING TOGETHER / A Guide for Action CONTENTS Introduction to the Guide 7 SECTION 1 - Setting the scene: 9 When LSM meets ASM on the ground SECTION 2 - Starting on the right foot: 15 Principles guiding engagement with ASM SECTION 3 - What can be done? 21 Tentative list of actions SECTION 4 - Framing a corporate policy on ASM: 27 General recommendations Appendix 1 : Bibliography 30 Appendix 2 : Case studies 32 Map 1. Sample of clashes reportedly caused by ASM - LSM interaction 2007-08 SIERRA LEONE Koidu - Diamonds 1990-2008 PNG Porgera - Gold 1996 COLOMBIE Bolivar - Gold 2005 TANZANIA 2008 GHANA Geita - Gold 1984 BRAZIL Obuasi - Gold Serra Pelada - Gold 1996 BRAZIL Serra Leste - Gold 2008 DRC Kamatanda - Copper/cobalt Source : Compiled by CASM, 2008. Map 2. Colloquial names for artisanal miners Orpailleurs (gold) Francophone Africa Ninjas Mongolia Diggers Sierra Leone and Liberia Pocket Miners Pork Knockers Philippines Guyana Warare Ethiopia Galamsey Ubeshi (diamonds) Ghana Nyonga (tanzanite) Piquineros Latin America Wabeshi (diamonds) Tanzanie Garimperos Creuseurs Panners Lusaphone countries Francophone Zimbabwe Africa Source : Adapted from Wardell Armstrong 2007. INTRODUCTION TO THE GUIDE Large-Scale Mining (LSM) companies A “Mining together toolkit� is being drafted (7) increasingly come across Artisanal and Small- to complement this CASM “Mining together scale Mining (ASM) workers during their guide�. This sister-publication, to be published exploration or production activities in the in 2009, will be more application oriented and developing world. The ASM-LSM relationship more specifically targeted to mine-site staff in is often conflictual because both types of charge of designing and implementing ASM- miners compete for the same resource or LSM action plans. because they perceive each other as a threat. However the ASM-LSM relationship is now also undergoing a largely positive evolution in part thanks to new Corporate Social Responsibility A note on terminology: (CSR) commitments. In some places, “mining together� has become more than a dream. LSM in this guide refers to the activity of major companies as well as to mid-tier and junior-level The Communities and Small-scale Mining companies or to any formal company that complies (CASM) initiative wishes to contribute to the with international performance standards. sharing of knowledge and solutions related to ASM-LSM issues. CASM has partnered with ASM covers both artisanal and small-scale mining two key resources in the field of community even if this guide focuses mostly on artisanal mining. development and mining: the World Bank / The term ASM is used in a broad sense to refer to all International Finance Corporation Oil, Gas and kinds of local mining activity that larger companies Mining Sustainable Community Development could encounter. Fund (CommDev), and the ASM working group of the International Council on Metals and Mining 1 (ICMM). This guide is the result of this collaboration and provides an informative overview of the growing experiences of the most typical ASM- LSM issues and guidance for appropriate interventions. It is primarily intended for an audience of LSM executives or staff in search of ways both to engage constructively with ASM and apply lessons learned from past experiences in the field. It is also intended for government responsible for the design or the enforcement of laws or regulations to tackle potential ASM-LSM conflicts. Finally, other stakeholders and practitioners from NGO’s, development agencies or civil society organizations (CSO) could use it to understand the dynamics, the key concepts, as well as the evolving 1 For more information on the mentioned partners, please refer to the following websites: www.artisanalmining.org (CASM), www. approaches to this sector. commdev.org (CommDev), and www.icmm.com (ICMM). MINING TOGETHER / A Guide for Action C It is widely recognized that maintaining a harmonious relationship between large-scale multinational mining companies and local operators is crucial if both parties are to Section 1 maximize their contributions to the economy and livelihoods of the operational areas. Anthony Kwesi Aubynn, Goldfields Limited (8) MINING TOGETHER / A Guide for Action SETTING THE SCENE When LSM Meets ASM on the Ground Just like the differences between subsistence main situations where LSM meets ASM on the (9) and industrial agriculture, it is common to ground and the reasons why the relationship is distinguish between Artisanal and Small- likely to be confrontational. scale Mining (ASM) and Large-scale Mining (LSM). ASM, like subsistence agriculture, means low investment, labor intensive local ASM is still growing production, informality, as well as no or low levels of mechanization and access to market. ASM does involve a lot of people. One widely LSM, like industrial agriculture, implies large used estimate is that more than 100 million investments, high yields and comparatively low people globally depend either directly or levels of employment. indirectly on ASM for their livelihoods. In Africa alone (see Table 1), it is estimated that More than in agriculture, the two mining between 6 million and 8 million people are approaches may overlap and compete for directly employed in ASM, with a potential 20 access to the same mineral resource in many million population depending on the sector. part of the world. This section illustrates the Table 1. LSM and ASM in Africa Main Mining Countries Main Commodities Main Commodities Number of ASM Mined by LSM Mined by ASM workers Angola diamond diamond 100,000-500,000 Botswana diamond — — Burkina Faso gold gold 80,000-200,000 Central African Rep. — diamond 60,000-120,000 Dem. Rep. of Congo diamond, copper, cobalt diamond, coltan, gold, copper 800,000-1,500,000 Ethiopia gold, tantalum gold 50,000-150,000 Ghana gold, diamond, manganese gold, diamond 150,000-250,000 Guinea bauxite, gold, iron gold, diamond 80,000-150,000 Liberia diamond, iron diamond, gold 25,000-75,000 Madagascar titanium, nickel, chromite sapphires, rubies, semiprecious 350,000-900,000 stones, gold Mali gold gold 130,000-200,000 Mauritania iron — — Mozambique titanium, coal gold 12,000-35,000 Namibia diamond, zinc diamond 8,000-10,000 Niger uranium, gold gold, tin 80,000-150,000 Sierra Leone diamond, titanium diamond, gold 300,000-650,000 South Africa iron, manganese, platinum, diamond, gold 8,000-25,000 gold, chromium, coal Tanzania gold, diamond, tanzanite diamond, gold, tanzanite, gemstones 400,000-800,000 Zambia copper gold, emeralds, semiprecious stones 25,000-50,000 Zimbabwe platinum diamond, gold 200,000-400,000 Source: Compiled by Pelon 2005. — = not applicable. MINING TOGETHER / A Guide for Action (10) In economies characterized by low earnings represent a complementary off-season activity levels, ASM provides an accessible livelihood to agriculture for peasants. When agriculture opportunity for poor and marginalized people. products prices decrease, those people tend to There are generally no entry barriers: neither rely more intensively on ASM. administrative, as it is mainly informal, nor financial, as it is essentially manual. Also, it As ASM is growing worldwide, its probability typically requires little start-up time and very to clash with LSM is also increasing. Booming low capital or technical inputs, as for example exploration during commodity peaks opens in alluvial mining along rivers. new frontiers to LSM companies. To meet demand, they would increasingly rely on The number of commodities mined by ASM previously neglected resources, such as lower miners has been increasing through time. As grade or harder-to-access deposits. While a rule, artisanal miners would mine high-value such resources requiring more sophisticated minerals such as gold, diamonds, or colored technology or investments would generally not gemstones, which together account for as be exploitable by artisans, LSM companies are much as 60% of all artisanal mining. In the also exploring new areas where ASM might Democratic Republic of Congo (DRC) as well actually be preceding them or where deposits as in Sierra Leone, artisanal gold and diamond are more easily accessible. Finally, they might mining accounts for more than 75% of national also attract ASM because their exploration mining sector production. When taking into or development activities contribute to raise account construction materials and industrial, expectations or expose minerals. or other minerals, artisanal miners exploit more than 40 different minerals globally. Particularly under commodity boom circumstances, When LSM companies work on a artisans may even be producing minerals previous ASM area traditionally mined by industrial mines, such as coltan, cassiterite, cobalt, copper or coal and When a LSM company develops its activities uranium. On the other hand, an economic crisis on a previous ASM2 area, the ASM community could also force many people either to stay in might likely not welcome it for a number of the ASM business or to join it, for lack of other possible reasons. employment opportunities. First, ASM communities might not have been ASM growth can be due to different factors. properly consulted or even informed about ASM represents a many centuries tradition the LSM plans. The lack of consultation and in some regions like in Mali or Peru, and communication generates apprehension and the activity increases gradually with the a rejection attitude, particularly when there population. In other countries, ASM is the is perception that access to a traditional consequence of a rush. In Madagascar for resource will be lost. Although consultation, example, the discoveries of sapphire in the late and sometimes negotiations, with local 1990s triggered a sharp influx of hundreds communities (including preexisting ASM) of miners in new “wild west� type of cities. represent often a legal requirement to obtain Sometimes the rush is a result of external shocks like droughts or conflicts, which often 2 We describe here a situation where the ASM has not a legal implies migration of people to regions where mining permit over the area. If it would have such right, the rela- tionship would indeed be different and the company, if interested to mining is an income generating alternative. further develop the area, would have to purchase the property title Between those extremes, ASM sometimes or negotiate another type of agreement. MINING TOGETHER / A Guide for Action authorization to start mining, this is seldom a competition for a specific ore section (e.g. in (11) condition at the exploration stage. A company case of open pit mining), which would require might be tempted to wait to achieve sufficient the LSM company to develop an agreement geological works and identify a clear investment with the ASM miners, or even relocate and opportunity, selecting the most promising part compensate the community if it lives on top of of the lease (which might also represent quite a the deposit. However, the legitimacy of such large area), before entering into a more serious agreements or negotiations might not always relationship with the communities.. However, be recognized by the ASMs, particularly in there is now increasing evidences, particularly cases when artisanal mining represents a in case of ASM presence, that communication long tradition. Despite the fact that in almost and even consultation or conflict management all countries the subsoil resources are vested processes have to be initiated with local in the state, and an authorization or permit communities at an early stage, before is required to mine, ASM communities might expectations, misunderstandings, fears or still consider they have a rightful access to perceptions of threat grow out of proportion. mineral resources as well as to other local When reaching the mine development stage, resources (See Table 2 next page): “This is existing legal provisions requiring participatory our own land and we, and not anybody from processes to take place could facilitate the anywhere, decides how to use it to our benefit. relationship between ASM and LSM. However, If we can farm on this land, why can’t we mine informal or illegal ASM workers have as a rule the gold in it?� (Ghanean ASM operator at the little trust in the legal system and government Abosso mine site, as reported in Aubynn, 2006) (ASM might believe they are biased in favor Opinions of this nature are widespread. of a large-scale investment), and, while local and central authorities need to be part of the Third, ASM communities sometimes claim process, the company might find they are in they have discovered the deposit, and not the charge to build trust and manage the dialogue. LSM company. This might be true, and LSM companies acknowledge it when they follow Second, ASM communities see LSM companies or map ASM activities to guide exploration. as competitors for the resource they live from. However, ASM workers are often unable to This is all the more true when ASM has been materialize their “discoverer right� because a traditional activity in the area. A community they are not properly organized and do not that has been sustaining itself for years on qualify for or have access to the mining mining local mineral resources will not welcome cadastre granting the required title (in most the arrival of a large mining company planning countries, titles are granted on the basis of the to explore it, and claiming, generally justly “first-come, first-served� principle). so, the legal right to mine it. Sometimes, the LSM company is actually interested to exploit Within this framework, ASM communities resources which are not accessible to ASM might then face the conflict with LSM as a for technology or other reasons, but ASM challenge for survival and consider they engage communities might still consider LSM as a in a legitimate fight against the perceived threat because of i.a. the set-up of necessary violation of their right to work on their own security or safety constraints within the area; land. In some occasions, nationalistic-like or, more generally because of the overall feelings may exacerbate such situations, ASM changes caused by the mine with respect being managed by nationals and LSM often by to local market, trade or socio-economic foreigners. conditions, In other cases, there is a real MINING TOGETHER / A Guide for Action (12) Table 2. Prevailing perceptions of mining rights and status LSM ASM Companies perceive that they: Artisanal miners perceive that they: •Have a legal mining title and thereby •Have traditional rights to access minerals rights over the area titled on their “homelands,� with or without title •Have followed national legislation to ob- •Have a right to mine the deposits they have tain the license by paying fees and levies encountered •Have economic importance for the •Have the right to mine as a means to gene- country, contributing to national production, rate income and to sustain their families the payment of royalties, and so on •Have no obligation to apply for central go- •Have planned their business development vernment licenses, as other local resources and expect not to be harassed by illegal are traditionally managed locally diggers (artisanal miners) •Have support from local administration or •Have access to national and international traditional authorities that support the gene- media ration of self-sustained income through ASM •Have the right to engage security forces •Have support from local communities living and police to remove artisanal miners from on the direct income from ASM and econo- their property mic spin-off effects •Have lobbying forces in politics and econo- •Have little recognition by the government, mics society, or economic key players, including limited legal access to full mining titles, dif- ficulties in achieving fair market prices, and scant access to capital and funding Source: Priester 2007. Note: In cases in which local people have land titles or indigenous rights, such rights are generally different from the mining titles granted to LSM companies and do not automatically allow access to minerals. When ASM starts working on LSM sometimes attracted by findings from LSM- leases prospecting activities, would gather from neighboring areas and start producing A LSM company is facing multiple risks minerals almost immediately (ASM workers and issues when ASM starts to develop on do not spend time to mobilize investment its property. Experience shows that many funds, demonstrate the feasibility of the disruptions or suspensions of operations deposit or construct infrastructure) Under have been related, under a variety of a few legislations, such activities might circumstances, to clashes with ASM (See Map threaten the LSM permit continuity of tenure 1 in Introduction). through exploitation and the ASM might claim precedence and be granted the right to mine. At the local level, an exploring LSM company However, more frequently, the LSM company will probably see the development of ASM might get discouraged to further engage when activity as a risk in terms of property and interferences become a real liability for proper work program management. Indeed ASM, planning and implementation. There are also MINING TOGETHER / A Guide for Action examples when government authorities might related to child labor, environmental damages, (13) not facilitate a fair dialogue and support ASM illegal activities, human rights abuses that may for - sometimes legitimate but more often have nothing to do directly with the mining obscure – local political reasons, causing the company but take place on or in the direct LSM to reconsider a potential investment. At vicinity of the concession, are likely to affect best, the company might negotiate and allocate the reputation of the company. This could be some portion of the area for ASM mining, or true of any business but it is paramount for the compensate them (e.g. through resettlement or mining industry which tends to be highly visible alternative livelihood opportunities). At worst, because of its strong footprint and related the LSM exploration investment might be lost impacts. A tarnished reputation can affect in to the benefit of local opportunistic miners, turn shareholders or investors’ confidence in sometimes hiding behind and using the ASM the LSM company and jeopardize the viability themselves. of its current and future projects. Investors are becoming indeed more demanding When the LSM company has already obtained of companies and banks are facing more the necessary permits and started construction pressure to verify the quality and the image of or even production, the invasion of ASM miners the projects they engage in. on the lease presents high risks in terms of safety and security. Encroachments of ASM Of course, ASM-related risks and possible on LSM sites represent safety risks for both measures to mitigate them depend on the company employees and ASM miners, or cause situations. LSM companies have to tailor serious damages to the environment. Rock different responses if they face gradual falls or shaft collapses for instance can cause increase of neighboring ASM activity or if serious injuries and fatalities. Trespassing, they have to deal with a sudden rush on their invasion or acts of violence on staff or facilities, concession (See Section 3). are significant and expensive security issues. Also, although the vast majority of ASM are In conclusion, whoever is the “first-come�, ASM undertaking a vital livelihood activity, there or LSM, the ASM-LSM relationship is by nature are strong evidences that, mostly in the case a conflict one. To respond credibly to demands of gold and diamond mining, elements of placed on the business and to pressure from organized crime are sometimes involved. A host civil society, LSM will have little choice but to of players have vested interests–for example promote sound ASM practices and engage money laundering or smuggling schemes, or responsibly with ASM in the medium to of support to civil war –in maintaining the long run. The role of governments is indeed status quo of informality and illegality. For the paramount to facilitate a proper outcome. legitimate operator, any sort of disruptions or accidents can bring stoppages or delays that increase the cost of development or production. This, joint to ASM “high-grading� activities that dilute high-value mineral deposits, will ultimately reduce the economic viability of the concession development, and might jeopardize altogether the industrial activity. At the global level, ASM poses significant reputational risks for LSM companies. Incidents MINING TOGETHER / A Guide for Action C ASM miners have to be considered as real stakeholders if LSM companies want to preserve their investment in a sustainable manner. But beyond the question of protecting their business, it provides these companies with a unique chance to fight against poverty and for human rights. Section 2 Gotthard Walser, CASM STARTING ON THE RIGHT FOOT Principles Guiding Engagement with ASM ASM is mainly a poverty-driven activity. In some mining great enough, the ASM miners will (15) places, people will choose such laborious and continue to return, often in situations of even risky work because they dream of striking it greater precariousness. In fact, trying to move rich (e.g. the gold or diamond “fever�). But away artisanal miners from a concession can when communities resort to artisanal mining, cost in the long term more in financial and either on a permanent or a seasonal basis, it is reputational terms than other alternatives. often simply because it represents one of the Some companies tried to “buy� artisanal best available cash-generating activity locally. miners. But neither force nor money really The absence of alternative sources of income works (see Box 1): artisanal mining is here to makes people put up with the physical hazards, stay. the unhealthy conditions, the social disruption, and the unreliable or poor financial returns. This section provides basic principles for LSM Box 1. Nambija, Ecuador to engage with ASM not only with respect to sound risk management but also to community development. In the early 1990s, the government of Namibia wished to formalize the ASM Nambija area and declared it an ASM is here to stay Emergency Zone. However, illegal and uncontrolled mining continued. A foreign Today most LSM companies are recognizing mining company acquired the Nambija ASM realities and, as they have redefined mining concession and planned a large- their role in promoting the sustainable use of scale open pit operation. natural resources, they tend to better include ASM as a specific challenge of community Because about 10,000 artisanal miners development. As stated on the Barrick Gold were operating in Nambija, and because Corporation website: “Barrick recognizes that of earlier negative experiences, a “brute- ASM communities are a key stakeholder group force� military approach to displace and therefore require a more collaborative them was rejected. Instead, the company approach, focusing not only on how to coexist, decided to buy the drifts and shafts from but also how to benefit from each other’s skills their informal “owners� on a per meter and expertise. Barrick has initiated an internal basis. ASM Working Group to develop a coordinated strategy to address issues the Company faces Miners located in poor areas sold with regards to the ASM sector.� immediately; others started to dig new tunnels in order to sell them to the In the past, companies tended to adopt a company. The occupants with the richest laissez-faire attitude that simply tolerated the locations refused to sell and continued to presence of illegal ASM activity, provided it exploit the sites, waiting to recover the did not encroach on or affect their operations. high-grade ore and expecting to sell Other companies tried to disperse small-scale shortly before closing mined-out areas. miners by calling in national security forces, After a couple of years, the company had contracting additional security, or calling upon spent several million dollars in buying government’s police or military forces. This sterile tunnels and went bankrupt. is rarely a successful approach: if poverty is Source: Priester 2007. severe enough and the potential rewards of MINING TOGETHER / A Guide for Action (16) ASM-LSM conflicts need an appropriate of issues and priorities relevant to these risk management strategy individuals and groups will inevitably emerge from the assessment process. LSM companies may find themselves, either by Trained and impartial facilitators—in many surprise or despite planning efforts, suddenly cases, NGOs—can significantly help in group trapped in conflicts that would require a good decision-making processes. A good facilitator conflict management strategy. would analyze the situation as an impartial third party, design the process, encourage Alternative dispute resolution (ADR) is a agreement on the rules of engagement, frequently employed approach to conflict assess the process, and adjust accordingly. management (ICMM/WB Community He or she would also promote trust, ensure Development Toolkit 2005). ADR can effectively both a positive environment and effective reduce litigation costs, but may also have a participation, and enable decision making. negative effect on the relationships between parties, reducing opportunities for future However, one lesson learned through or longer-term conflict resolution. Major recent experiences in dealing with ASM- constraints to using ADR in ASM-LSM conflict LSM relationships is that conflict resolution situations include huge efforts among the processes should not simply aim to mitigate parties in terms of information, knowledge, current conflicts. Mining companies with more resources, and capacity to understand or advanced community relationships policies are manage processes, not to mention power often more successful and engage proactively relationships. with stakeholders, including artisanal miners, promoting closer partnerships and a shared Conflict resolution efforts should instead focus development vision. This cooperation will on consensus building processes, a powerful provide a major opportunity to move toward tool not only to resolve conflicts but also to sustainable development. strengthen relationships between stakeholders and chart a course for participatory management of mineral resources. This does LSM has a potential advantage in not mean that all parties will necessarily be engaging with ASM satisfied, but as the objective is to set up win-win situations, the likelihood of long-term When ASM occurs around LSM, engaging resolution is significant (Ali 2003). It is critical with ASM will help the LSM company to gain that all stakeholders involved in the process its “social license to operate�. Corporate should receive the training necessary to ensure awareness has been growing regarding the their full involvement. importance of such a social license. It is tacitly taken for granted by local communities and A precise understanding of the diverse concerned civil society groups that such a aspects of a conflict requires detailed conflict “license� is mandatory, in addition to the legal identification and “mapping.� The first step permits officially granted by the state. Rio Tinto involves the characterization of the various summarized this new understanding and the stakeholders, including miners, companies, artisanal miner’s role : “The social license NGOs, community-based organizations, would be the result of work undertaken in the local residents, and local, regional, and process of consultation and participation and national governments (ICMM/WB Community of a strong trilateral dialogue among the LSM Development Toolkit 2005). A broad spectrum industry, ASM communities, and government MINING TOGETHER / A Guide for Action at the local, regional and national levels. The the West, and as developing countries get (17) general public sees just such a relationship more open to foreign investment, the battle when it considers the environmental and for growth will increasingly be taken to the social impacts of mining. And, because of that developing world (Howard 2007). These perception, the artisanal miner can affect the countries provide a platform for establishing a fortunes of the large-scale miner. His—or her— competitive advantage. In Africa, for instance, effect may not be immediately obvious; but, exploration in recent years largely focused on ultimately, it will influence the willingness of Angola, Ghana, Tanzania, the DRC, and South the public to give a large company a license to Africa. Except for the latter, all these countries operate, now and in the future� (Gary O’Brien, have a huge ASM sector. A company that better 6th CASM Annual Conference proceedings, integrates with the communities and countries 2006). in which it wishes to operate—based on a commitment to be a responsible and pro-active Successful engagement with ASM can also citizen, including with respect to ASM—is in a mean a comparative advantage. Locally, better position to secure growth opportunities competitions can sometimes be turned into through access to mineral resources or complementarities (See Box 2). Globally, as development projects. All results from a good operating costs rise and reserves dwindle in work in this direction can be lost quickly, however, if the company does not ensure Box 2. From conflict to common interest continuity in its efforts to reduce potential social resentment to its presence. In the Philippines, Benguet Corporation has allowed small-scale gold miners to legally mine on the company’s property in LSM is expected to play a role in ASM exchange for exclusive rights to purchase development the tailings from gravity concentration. In many ASM countries, LSM will actually Throughout Uganda, as much as 20% of be expected to contribute to community, the “production� of several large-scale including ASM, development. When it enters industrial mineral companies is purchased a remote region of a developing country, a directly from both legal and illegal artisanal mining company becomes suddenly a rich and small-scale miners. and powerful member of the community and generates a lot of expectations. Even In northern Tanzania, one formal, mid-size when they do not truly compete to access the mining company allowed illegal ASM on its same deposit, it is common to hear people property. Because these activities prece- comparing ASM and LSM and concluding that ded the formal claim, their locations are ASM is neglected or even sacrificed to the not interfering and mining is carried out benefit of LSM. Such statements are often on a small scale. In spite of liability issues badly informed and biased, but they reveal (illegality, environment), the agreement how ASM and LSM are inherently associated. created a solid framework for the imple- They are part of the same sector. The success mentation of a legalization process and of a LSM company in an impoverished ASM provision of technical support for improved area might be regarded as outrageous practices. if the company does nothing to make its Source : Compiled by CASM 2007 development serve the one of its perceived poorest counterparts. MINING TOGETHER / A Guide for Action Table 3. Issues associated with ASM in international codes and standards Health and Safety (specific mention) Development Engagement Environmental Human Rights Anticorruption Resettlement Transparency Community Governance Child Labor Relocation and Good Security Gender and ASM and and UN Voluntary Principles on Security and x x Human Rights (18) Global Compact x x x x Kimberley Process x x x IFC Performance Standards x x x x x Equator Principles x Extractive Industry Transparency x Initiative (EITI) (a) OECD Guidelines for Multinational x x x Enterprises GRI MMSS x ILO Declaration on Principles x and Rights at Work ILO182 Worst Forms of Child Labour x x Convention (c) ICMM Sustainable Development x x x x x x x Principles (b) Millennium Development Goals x x x x x CRJP Principles x x x x x x x Source: Adapted from Armstrong, 2007. Note: CRJP = Council for Responsible Jewelry Practices; EITI = Extractive Industry Transparency Initiative; GRI MMSS = Global Reporting Initiative and Mining and Metals Sector Supplement; ICMM = International Council on Mining and Metals; IFC = International Finance Corporation; ILO = International Labor Organization; OECD = Organization for Economic Co-operation and Development. (a) Although this is a government-led process, companies can be signatories to the EITI and should aid or support its implementation by the host country. Some companies publish payments. (b) Membership to ICMM is granted by council members. The principles and best practice are available to and can be implemented by any company. (c) Reinforced by the statement concluding the ILO “Call to Action� campaign on Eliminating Child Labor in Mining and Quarrying (World Day Against Child Labor, June 12, 2005), which ICMM and CASM signed. Meeting in part those expectations is holder’s plant and infrastructure indicated sometimes a legal obligation. In some in the approved program of operation. countries, the legal framework includes some Similar provisions related to alluvial mining provisions bound to allow cohabitation. In are included in the 2005 Mining Code of Zambia for instance, under the Mining and Madagascar. Minerals Development №7, 2008, a formal ASM worker may apply for a mining right If it is not a legal requirement, LSM companies over an area subject to a large scale mining would still have to play a role in ASM license. Typically, he would apply for consent development as part of their international from an LSM title holder, which consent “shall voluntary initiatives. LSM companies may be not be unreasonably withhold�. The holder signatories to a number of international codes shall, within a period of 90 days, consent the of conduct and operating standards on the application where different criteria are met, environment, human rights, transparency, like the geological positions of the minerals and corporate responsibility (See Table 3). By or metals applied for being different from the signing these codes and standards, companies MINING TOGETHER / A Guide for Action commit to actively implement and abide by Although some companies might say they (19) their precepts and should expect to be held cannot “afford� a social program during the accountable to them by shareholders and exploration stage, when cash flows are nega- other stakeholders. Policies to deal with ASM tive and long-term tenure is uncertain, there are naturally part of community development is a strong business case for early community commitments. engagement, including reduced risk of social conflict and correlated delays, faster permitting and approvals, reduced risk of criticism and Plan to engage at the earliest possible interference from outside parties, and more stage… and as long as needed effective use of corporate resources. Engagement is needed at each stage of the During the construction and exploitation pha- resource cycle, from exploration to mine ses, continuous engagement is most needed. closure. Identifying and addressing artisanal And cooperation can still be of primary impor- mining issues early on and managing them tance at the closure or post-closure stages. actively throughout the life of the project will be The Kelian case study (See Box 3) provides an necessary and will increase the likelihood of example of an ASM-LSM relationship that led success of commercial mining operations. to cautiously planned and implemented actions to mitigate safety and environmental risks at closure. Box 3. Kelian, Indonesia There was a tradition of artisanal alluvial gold mining at Kelian, and building the mine involved compensating and resettling several thousand people. As part of its closure plan (industrial mining activities ceased after 13 years of operation), Rio Tinto’s Kelian Equatorial Mining (KEM) undertook to develop wetlands to ensure that water discharged from the mine site met environmental standards. Despite the area being officially designated as a “protection forest,� it seemed inevitable that former settlers would return to the site and search for alluvial gold in the wetlands. This would most likely have negated the company’s rehabilitation work. KEM’s response was to enter into a partnership with the government and the community whereby the company mined the area for alluvial gold prior to constructing the wetlands. Local people are part of this alluvial mining, and the whole community witnesses the depletion of gold resources on the wetlands site. The proceeds are then put into a fund and shared with the community as a non-cash grant according to an agreed formula. Once the area is sterili- zed, rehabilitation can commence. Should settlers subsequently damage the wetlands, the costs of making good the damage will be deducted from the quarterly community grant. KEM has also worked with the regional government to help alluvial miners work out—or sterilize—de- position points on the tailings dam as part of the closure program. Other activities of the program include a community awareness program to cover a range of issues, such as occupational health and safety, the use of mercury in ASM, and community- based management of future ASM activities. Source: O’Brien 2006. MINING TOGETHER / A Guide for Action Companies such as Rio Tinto appreciate that building constructive relationships with small-scale miners works better than increasing security or appealing to authority. Constructive relationships are also required if a company is to help local communities deal with economic and social change. Section 3 Gary O’Brien, Rio Tinto WHAT CAN BE DONE ? A Tentative List of Actions In this section “actions� primarily refer to agencies, and local communities will be (21) actions that LSM companies can implement required to find sustainable solutions to ASM- on the ground to manage their relationship LSM conflicts (See Section 4). with ASM communities. This does not mean that only LSM should take actions. Arguably, Each mine site has its own historical, social, LSM companies are not the only responsible cultural, and geographical characteristics and and even may not be in the best position for peculiarities, so a generic “one-size-fits-all� intervening to solve or prevent an ASM-LSM prescription for ASM activities will not work. conflict. In fact, in many circumstances, the Current activities in Tanzania illustrate the government should be the one taking the range of options for working with artisanal and lead and providing either arbitration or law small-scale miners (See Box 4). The variety of enforcement. As stated, it is usually the state the names given to ASM workers also reminds which concedes the right to explore or exploit us of the diversity of the situations (See Map 2 mineral resources to an LSM company, and it in Introduction). should therefore guarantee and protect it. That said, this section is intended to present in However, ASM-LSM conflicts in developing a sequential way a series of possible actions countries frequently occur in remote areas that different companies have experimented where government presence and access are globally with various levels of success in res- limited. In practice, companies will most of ponse to different sets of situations. the times have no choice but to than find ways to offset weak public institutions. As they Box 4. Various mine site activities in sometimes find themselves expected to take Tanzania on roles that government should otherwise be fulfilling, like providing education and health At Geita Gold Mine, AngloGold Ashanti has care, social or infrastructure projects, mining partnered with the UK Department for Interna- companies will often have to be proactive with tional Development and UNIDO to provide safety ASM. Thus LSM must go beyond the letter training and technical assistance to artisanal of the law and, in addition to interpreting miners. At North Mara, Bulyanhulu, and Buzwagi, legislation in the most proactive way, develop Barrick Gold has encouraged the establishment community development strategies that include of ASM Committees in the communities ASM communities. Without going too far and surrounding the operations. The aim is to removing government responsibility towards collectively generate solutions specific to each the local populations–and thereby somewhat area that will address the issues of access to fostering community dependence–the LSM land, education, training, technology, and capital. industry has to demonstrate its accountability within the local context. TanzaniteOne has established a Small Mines Assistance Program under the auspices of the Again, engaging with ASM on the basis of TanzaniteOne Foundation. Williamson Diamonds voluntary standards or principles in addition Limited, together with the government and local to legal obligations does not mean, of course, communities near the Mwadui mine, has laun- that LSM companies should work on their ched the Mwadui Community Diamond own or according to their own agenda. A Partnership in order to formalize and support multistakeholder approach, including the ASM activities in the diamond sector. existing players on the ground, such as local Source: and central authorities, NGO’s, development Tanzania Chamber of Minerals and Energy, 2007. MINING TOGETHER / A Guide for Action (22) A. Engaging with preexisting ASM communities When ASM precedes LSM, the ASM-LSM relationship is typically a mining issue, the underlying challenge being to identify which party is the most legitimate to mine the resource and under which conditions to maximize an economic return within the framework of the law. This question is normally addressed by the mining legislation. If it is not, the first type of action that LSM can take is precisely to promote a better legal and regulatory framework. Action 1: Promote a better legal and regulatory framework Regularization of artisanal miners is a necessary process in the early stages of engagement because it provides a legal framework to deal with ASM and opens the way to formalization. The private mining sector can collectively raise the profile of the ASM challenge at the local and national level by increasing awareness of, and lobbying the government and resident donors on, key development issues in order to give priority to ASM in national development strategies. LSM can liaise with government departments, NGOs, and international agencies to obtain additional support. (See the La Rinconada (Peru) case study in Appendix 2) When ASM workers are not organized There is always a certain degree of organization but in some places it is too fragile, too volatile, or too uncertain. LSM may try and find a way to get the ASM community better organized before envisaging other actions. Action 2: Help ASM to get organized Organization is a requirement as it is impossible for LSM to deal with multiple individual and independent parties. LSM can typically provide help to draw up an inventory of the miners. Initial actions can also be taken at this stage to eliminate child labor as a condition of LSM engagement in the community or to improve women’s conditions in ASM communities through gender awareness and empowerment programs. (See the Las Cristinas (Venezuela) case study in Appendix 2) When ASM workers are organized Where ASM has been present for a long time and the miners have been able to get well organized, it is likely that the communities’ sense of ownership upon mineral resources is high. A formal agreement to cohabitate and share the resource is probably to be sought. The first step before establishing a formal partnership will be to help ASM miners fully legalize and formalize their activity. MINING TOGETHER / A Guide for Action (23) Action 3: Help ASM to formalize Formalization is a further step to organization. A group of ASM can try to acquire a legal status like an association, cooperative or enterprise and get registered by the administration. LSM can assist the process by advising on the best legal form, and the best administrative procedu- res. A registered ASM entity can then apply for a formal mining license or permit. In many coun- tries, dedicated ASM licenses are included in the legislation. LSM can help the group meeting all the eligibility criteria. (See the Las Cristinas (Venezuela) case study in Appendix 2) As soon as an ASM group is formalized, it is sometimes possible and in the LSM’s interest to try to reserve part of the deposit for ASM. If it is legal, the LSM company can delineate small zones that are deemed inappropriate for large-scale extraction on the lease. Action 4: Assign areas to ASM Many times the mineral resource can actually be shared between LSM and ASM because of different criteria for a viable exploitation. Actions here try to identify and assign areas on the mining lease that are dedicated to ASM work. When legal and possible, this can represent the best win-win approach. LSM can then support miners in the determination of mineral reserves on their designated area. (See the Mwadui (Tanzania) case study in Appendix 2) Ultimately, when an arrangement has been found to “mine together�, it is often advisable to offer technical assistance to the ASM entity so that better practices, especially in terms of environmental and social standards, are followed on the lease. Action 5: Provide technical assistance to ASM When artisanal and small-scale miners are formalized, a change in technical tools, means, or habits may be possible. The presence of LSM might be a unique opportunity to help ASM upgra- de toward sustainable development. Technical assistance and capacity-building programs are aiming at improving productivity and methods of operation for sounder economic, social, and environmental practices. LSM can also provide financing for technical and other improvements, guidance on marketing and commercialization, including fair trade arrangements, and assist the training of miners on a range of issues (for example, occupational health, reclamation, mining and processing methods, value-added processes, organizational and financial manage- ment, explosives management). (See the Boroo (Mongolia) case study in Appendix 2) When the formal ASM entity is following good practices, LSM might consider sub-contracting it or to pass other contracts as it would do with other business partners. Action 6: Employ ASM as subcontractors Ultimately when ASM is formalized and practices have improved, ASM entrepreneurial structu- res might emerge. They can be contracted to provide the mine with different services. A rela- tionship of trust can allow business arrangements whereby companies benefit from the local workforce and local miners are being empowered. (See the Bayankhongor (Mongolia) case study in Appendix2) MINING TOGETHER / A Guide for Action (24) B. Engaging with incoming ASM communities When ASM is incoming on LSM leases, there are broadly two cases: either it is sudden or it is gradual. When ASM is suddenly invading a LSM lease When LSM is taken by surprise and a sudden influx of ASM miners arrive on the lease, LSM has to provide emergency response services and the first reaction is understandably about safety and security. Action 7: Implement a safety and security plan This type of action focuses on implementing a comprehensive plan in which safety and security aspects are integrated in a collaborative approach, and entry to the active mine is prohibited through effective engagement with ASM and communities. When an ASM community settles within the perimeter of the operation, relocation, in accordance with international codes and standards might be necessary. (See the Porgera (PNG) case study in Appendix 2) When ASM is gradually developing on LSM lease When ASM is gradually developing around LSM, the ASM-LSM relationship is often more a community-development issue than a pure mining issue. In fact, in such cases, ASM is not a traditional all-times socioeconomic activity and there are probably alternative livelihoods. The first action is then to proactively support diversification options aiming at a better local economic development. Action 8: Promote diversification Poverty is often the reason why artisanal miners work on LSM leases. But artisanal mining might just be another poverty trap. Actions toward diversification try to promote alternative livelihoods and help communities during the transition away from mining. (See the Yanacocha (Peru) case study in Appendix 2) It might also be adequate to offer local jobs to qualified or trained people to avoid too much unem- ployment in the vicinity of the exploitation. Action 9: Create mine-site employment The development of a mine generates a lot of demand for labor. At the construction or exploitation phase, mine-site employment can target the local workforce. Programs tend to discern needs and skills while giving a preference to existing ASM workers. (See the Kinsevere (Katanga, DRC) case study in Appendix 2) MINING TOGETHER / A Guide for Action To reduce or prevent ASM growth, it can be useful to support the wider community to provide (25) locally for as many goods and services as possible. Action 10: Support access to basic services In many developing countries, government capacity and resources are insufficient to provide access to basic services. Related programs are designed in coordination with local and national authorities to promote local public goods such as education, health care provision, social infras- tructure, water sanitation, and other services, while avoiding the syndrome of LSM companies becoming a surrogate government. (See the Geita (Tanzania) case study in Appendix 2) MINING TOGETHER / A Guide for Action Addressing ASM challenges is part of WDL’s “social license to operate� and it is within its sphere of influence to make a difference. Section 4 Williamson Diamonds Limited (WDL) FRAMING A CORPORATE POLICY ON ASM General Recommendations As seen in the previous section, the spectrum authorities to commit themselves and clarify (27) of possible actions for engaging with the ASM the situation. sector is very broad. Again, solutions will always be specific, and a customized approach based NGOs or other third parties are important on existing local constraints and realities stakeholders. Large-scale companies within the will always be necessary to design the most formal mining sector have a wealth of expertise appropriate set of interventions. This section related to their core competency that they are provides general recommendations based on willing and able to contribute. But they do not lessons from international experiences in the always have their own experts in development, field of ASM-LSM relationship or, more broadly, and despite sometimes unrealistic expecta- of community development. They can be used tions, they cannot hope to address on their as cornerstones to frame a corporate policy on own all development challenges faced by the ASM. communities around which they operate. LSM has to work in partnership with non-govern- mental organizations, donor and development Adopt a multistakeholder approach agencies and civil society groups to further support the activities and priorities of national ASM-LSM issues can best be addressed by and local authorities. Sharing responsibilities adopting a collaborative multistakeholder in a partnership with civil society organizations approach. In some circumstances governments may make costs and risks more manageable, can take a lead role; in other situations, NGOs increase the effectiveness of actions in the or development agencies could become the community, and provide third-party objectivity. facilitators; or, in some cases, LSM will have to be the main driving force. In all cases, however, ASM workers, their (legitimate) representatives, local communities and ASM workers need to be and communities have to be at the heart of the at the core of the participatory approach. partnership. Companies need to recognize that artisanal miners are often part of the larger Governments should theoretically be able to community adjacent to their operations or enforce the law and clarify the situation in the properties. They are, in effect, among the key event of ASM-LSM conflicts. As noted earlier, stakeholders in the community, with families however, conflicts often arise when the state who depend on the income they earn from mi- of law is weak. LSM will then have to take a ning. As such, collaboration with them implies greater share of the responsibility and find improving the well-being of the community as a practical solutions. It should be acknowledged whole. At the same time, communities have a that some governments may be unwilling to role to play in ensuring that large-scale mining support LSM positions. Any attempt to remove companies can conduct their core business in artisanal miners from LSM operations without a safe and secure environment. providing acceptable alternative sources of livelihood risks putting more people out But ASM workers cannot always be assimilated of work, which can have serious political into local communities. When individuals consequences for the government in power. have been attracted to mining, for instance, This can be another reason to work closely because of activities of a large company in a with governments, especially when they have new area, they may have migrated from far become more assertive in managing their away, or, especially in rush situations, migrants natural resources. It might be important to might even come from other countries, get involved in policy reforms and urge the generating another set of conflicts between MINING TOGETHER / A Guide for Action (28) ASM and the local community. This requires Even during the first step of ASM formalization, an action plan that would include ASM and which might include the development of an the local community as two separate sets of appropriate and effective regulatory framework, stakeholders. the LSM sector can play a major role in advising and piloting government reform. Many international stakeholders, including CASM and Help ASM to formalize CommDev, are currently raising awareness and facilitating active development projects in this As noted in Section 3, the challenges facing direction. the ASM sector cannot be overcome until a primary need is met—that is, formalization. Because so many ASM miners operate Whatever level of engagement is pursued, LSM informally, they do not understand or perhaps companies should contribute to the process of do not feel constrained to follow health and ASM formalization. The connection between the safety regulations or to meet environmental informal economy and poverty is clear and well- standards. It also means that they do not documented worldwide. Most informal workers pay royalties or any other relevant taxes. Yet have fewer opportunities and face a higher their informal status makes them vulnerable level of risk than their counterparts in the to abuses by landowners, officials, or local formal sector. In the case of mining, experience entrepreneurs and also leaves them subject to shows that these miners do not always set up sudden eviction. In addition, their lack of formal formal groups spontaneously. status may weaken their ability to get a fair Table 4. Sample community development tools for LSM-ASM relationship Disclosure and Access to Public disclosure of budgets, policies, rules, regulations, environmental and social Information impacts, and revenue transfers, using a medium that is accessible to communities Good Neighbor Agreements Co-produced commitment between communities and companies, which most likely has specific performance targets and time frames Community Forums Structured multistakeholder forums with company representatives as well as citi- zens from different parts of the community and sometimes other actors, including local government and NGOs Participatory Planning Members of local communities involved in planning local development projects, infrastructure, the routing of roads, and the design of buildings, and in issues such as employment and procurement policies and practices Participatory Budgeting Regional and neighborhood meetings elect citizen-delegates to determine how a budget will be used, determine which areas of a community are in most need, and provide year-end reports on the implementation of projects and goals Community Suggestion Boxes Members of the community submit anonymous complaints, issues, concerns, or suggestions, and the boxes are opened weekly in a public forum to answer the notes, or the answers are posted to a public bulletin board Community Scorecards Focus group discussions with local communities to generate feedback on service provision Co-Monitoring External, community, or participatory monitoring, measuring, and verification Citizen Report Cards Citizens evaluate the effectiveness of services; may be used to assess the quality of relationships between a company and communities MINING TOGETHER / A Guide for Action Box 5. Summary of the objectives of ASM interventions • Improve the commercial and social operating environment through a mutually beneficial and respectful coexistence among the local ASM sector, communities, and LSM companies • Link with CSR strategies, thereby ensuring that communities benefit from the company operating in the area • Retain a social license to operate—that is, ensure that socioeconomic and human rights issues are fully considered (29) and adopted—and protect corporate reputation locally, nationally, and internationally • Reduce regional in-migration of opportunistic artisanal miners and prevent illegal intruder activity and trespassing on LSM mining leases • Ensure the security, health, and safety of company personnel and local community members • Ensure a contribution toward long-term local sustainable development • Ensure that cross-cutting issues, such as alternative livelihoods, gender mainstreaming, child labor elimination, education, community health and sanitation, and strategic environmental management, remain key priorities • Advocate (and possibly collaborate on) the implementation of local development programs to improve the living conditions and basic social infrastructure in the local communities (such as water, sanitation, transport, basic nutritional services, schools/child care, health care, and security) return for their production. Formalization of the Develop a holistic approach ASM sector will help address these problems. One of CASM key commitment is to promote the development of a holistic approach Apply community development tools toward ASM that can transform this activity from a source of conflict and poverty into a Coordinating and aligning corporate-level public catalyst for economic growth and sustainable relations and social responsibility requirements development. (See Box 5.) Advancing ASM and with commercial mine-site realities and its contribution to poverty reduction requires operational needs can pose a significant an understanding of the complex challenges challenge for most companies. It requires facing the sector and explicit consideration effective and integrated management and of the strengths and opportunities inherent monitoring. to ASM communities. Technology to improve productivity in artisanal mining is essential Numerous tools and approaches are nowadays but not sufficient. A holistic alternative policy being developed for overall community devoted to transform the ASM sector into a development or towards the specific needs of more sustainable activity promotes a people- the extractive industry sector. Additional, more focused multidisciplinary view that includes all in-depth research and analysis are indeed potential aspects: economic, social, political, needed to understand the capacities and legal, and environmental together with health, contexts of communities and companies that safety, and security impacts. foster these win-win outcomes, but a variety of instruments are available to guide and facilitate The review of case studies increasingly for the improvement of ASM-LSM relationship suggests that, when companies and management. (See Table 4.) Multi-stakeholders communities have been able to set up participatory planning and monitoring are mutually acceptable ways of engaging, paramount and can be formalized to maximize three processes are developing: a shared local economic development as well as understanding of development issues, accountability between companies, local a shift in power relationships, and an government, and communities. improved organizational and institutional legitimacy. Shared understanding between LSM companies and ASM communities can be achieved in order to secure mutual development benefits. MINING TOGETHER / A Guide for Action Appendix 1 Bibliography (30) Communities and Small-scale Mining (CASM) www.artisanalmining.org IFC/World Bank Oil, Gas and Mining Sustainable Community Development Fund (CommDev) www.commdev.org International Council on Mining and Metals (ICMM) www.icmm.com Background documents n Ali, Saleem H. 2003. Mining, the Environment, and Indigenous Development Conflicts, University of Arizona Press, 254 pp. n Anglogold Ashanti. 2005. ‘Orpaillage’ or artisanal mining at Siguiri – finding the path to co- habitation. AngloGold Ashanti Report to Society 2007 Case Studies – Community. n Aubynn, Anthony Kwesi. 2006. “Live and Let’s Live�, The relationship between artisanal/small- scale and large-scale miners in Ghana: The Abosso Goldfields experience. In: Gavin M. Hilson, Editor, Small-Scale Mining, Rural Subsistence and Poverty in West Africa, Practical Action Publishing, Bourton-on-Dunsmore, UK (2006), pp. 227–240. n CASM, 2005. Millennium Development Goals and Small-Scale Mining. Proceedings from the Conference for Forging Partnerships for Action. n Gyan-Baffour, George. 2003. “Incorporating Artisanal Mining into a Country Poverty Reduction Strategy.� Presentation at the Second CASM Annual General Meeting, Elmina, Ghana, September 8–10. www.casmsite.org/ programmes_learning_Elmina.htm. n Hinton, Jennifer J. 2005. “Communities And Small-scale Mining: An Integrated Review For Development Planning.� CASM background paper. n Howard, Andy. 2007, Mining Journal. n International Council on Mining and Metals, World Bank, and the Energy Sector Management Assistance Programme. 2005. “Community Development Toolkit.� www.icmm.com/library_pub_ detail.php?rcd=183 n John, Nerys. 2008. Mwadui Community Diamond Partnership, Tanzania, Williamson Diamonds Limited (WDL), unpublished summary. n Main company Web sites: Rio Tinto, Barrick, Goldfields, Anglogold Ashanti, De Beers n Mbaya, Joseph. 2006. Anvil Mining experience in Republic Democratic of Congo, Communication at the sixth CASM Annual Conference, Anstirabe, Madagascar. n O’Brien, Gary. 2006, Keynote address at the Sixth CASM Annual Conference, Antisrabe, Madagascar, November 11. www.artisanalmining.org. n Parker, Rani. 2007. “Managing Risk And Maintaining License to Operate: Participatory Planning and Monitoring in the Extractive Industries.� Draft submitted to the World Bank Group. n Pelon, Remi. 2005. “Formalizing Informal Artisanal Mining Activity.� CASM background paper. n Porgera Joint Venture. 2008. “Illegal Mining and Sustainability�. A slide contribution to the FDC Workshop. MINING TOGETHER / A Guide for Action n Priester, Michael. 2007. “Small-Scale/Large-Scale Mining Conflicts, Good Examples of Positive (31) Outcomes.� A collection made for CASM. n Tanzania Chamber of Minerals and Energy Position Paper, Artisanal and Small-Scale Mining, 2007. n Wardell Armstrong LLP. 2007. “Developing Relationships with the Artisanal Mining Sector, Guidance for Large Scale Mining Companies.� Draft CASM/CommDev guideline. International Codes and Standards n Global Reporting Initiative, “GRI Mining and Metals Sector Supplement,� www.globalreporting. org/NR/rdonlyres/25EEF0C7-F050-48CA-9FF5-C79F359D9976/0/SS_MiningMetals_ENG.pdf n International Finance Corporation, “IFC Guidance Note on Land Acquisition and Involuntary Resettlement,� www.ifc.org/ifcext/enviro.nsf/Content/GuidanceNotes n Equator Principles, www.equator-principles.com n Extractive Industry Transparency Initiative, www.eitransparency.org n International Council on Mining and Metals, “ICMM Sustainable Development Principles,� www. icmm.com n International Labour Organization, “ILO Convention No. 182: Worst Forms of Child Labour Convention, 1999,� www.ilocarib.org.tt/childlabour/c182.htm n International Labour Organization, “ILO Declaration on Principles and Rights at Work,� www.ilo. org/dyn/declaris/DeclarationWeb.IndexPage n Kimberley Process, www.kimberleyprocess.com n Organisation for Economic Co-operation and Development, “OECD Guidelines for Multinational Enterprises,� www.oecd.org/department/0,3355,en_2649_34889_1_1_1_1_1,00.html n United Nations, “Voluntary Principles on Security and Human Rights,� www.voluntaryprinciples. org/principles Tools n CommDev Online Resource, commdev.org/section/tools n International Finance Corporation, “IFC Environment Division: Good Practice Notes: Doing Better Business through Effective Public Consultation and Disclosure,� www.ifc.org/ifcext/enviro.nsf/ AttachmentsByTitle/p_pubconsult/$FILE/ n PublicConsultation.pdf n International Finance Corporation, “IFC Environment Division: Investing in People: Sustaining Communities through Improved Business Practice: A Community Development Resource Guide for Companies,� www.ifc.org/ifcext/enviro.nsf/AttachmentsByTitle/p_comdev/$FILE/ CommunityGuide.pdf n Overseas Development Institute, “Business Partners for Development: Seven Training Modules for Managing Social Issues in the Extractive Industries Through the Tri-Sectoral Partnership Approach,� www.odi.org.uk/bpd-naturalresources/html/tools_train.html MINING TOGETHER / A Guide for Action Appendix 2 Case Studies (32) ACTION 1: Promote ASM sector Possible interventions regularization n Lobby the government and resident donors to raise the profile of the escalating social challenge of ASM and reduce corporate vulnerability n Advocate policy change to support the integration of ASM into the regional and national economy as a sustainable livelihood and poverty alleviation strategy (for example, Poverty Reduction Strategy Papers) n Work in partnership with other companies or through national chambers of mines to share experiences n Work with government, donors, and other stakeholders to provide best practices and information regarding regulatory framework reviews and amendments Discussion Regularization of artisanal miners, though needed in early stages of a mine’s development, is not under the control of mining companies, as it depends on government. When such regularization exists, its implementation often implies the strengthening of public institutions. Companies will need to consider a collaborative and nationwide approach with the authorities. Through such collaboration, the private mining sector could collectively raise the profile of the ASM challenge at the local and national level by increasing awareness of key development issues and by lobbying the government and donors on the need to mainstream ASM into national development strategies. Perhaps the biggest single problem regarding small-scale miners is their lack of legal status. MINING TOGETHER / A Guide for Action Promote ASM sector regularization Benefits Risks • Recognizes that ASM does not occur in • Has little immediate tangible mine-site a political vacuum benefit • Improves governance and control of the • Government apathy and public sector ASM sector bureaucracy can lead to failure • Facilitates knowledge sharing among • May lack political will and follow-up on companies private sector actions • Reduces corporate exposure by • Highlights the apparent gap between (33) working with other companies or through high-level policy and actions chambers of mines • With weak institutional capacity, may • Enhances company-government result in legal framework not being relations enforced • Influences national development strategies and resident donor agendas • Builds social and political capital and centrally won license to operate in-country • Supports international codes and standards The miners may resort to extra-legal means and was able to integrate the relevant actors (occupations, confrontations, denunciations, such as the regional government, NGOs, and and sabotage) in order to press their claims other specific agencies. for recognition and to try to gain some level of economic security. This lack of legality may limit n Lessons the options for companies in responding to The “neutrality� of the facilitator and its ability these situations, but unfortunately the burden to maintain a dialogue with each of the actors remains with the company, as do the legal and has been an important element of success. reputational consequences. The identification of the “win-win options� for ASM and LSM resulted in a contract proposal that equally benefited both mining subsectors CASE STUDY: La Rinconada, Peru and that converted “enemies� into “allies.� A precondition to solve the conflict was the n Context creation of a legal framework and the passing In La Rinconada, Peru, one of the highest gold of Peruvian Law on Artisanal Mining. Laws do mines in the world, ASM historically existed not immediately and automatically solve the within the property of the industrial mining conflicts between local actors, but they can company, Corporación Ananea S.A. establish clear rules of the game and define the respective role of all parties involved and thus n Actions prevent conflicts or provide solutions. A mediation process was facilitated by an external mediator to address the conflicting situation. It started with a series of roundtable meetings to develop rules for the process. The negotiations over two years led to an agreement allowing the artisanal miners to buy shares of the larger company. n Results GAMA Peru (a technical assistance project sponsored by the Swiss Government) was in position to create a bridge between the mining company and artisanal miners’ cooperatives MINING TOGETHER / A Guide for Action Appendix 2 Case Studies (34) ACTIONS 2 & 3: Contribute to Possible interventions ASM organization and n Identify tangible incentives for and raise awareness of formalization formalization n Work with national governments on regulatory issues and barriers to ASM formalization, including access to land n Investigate the process of small and medium- sized enterprise (SME)/cooperative formation n Foster self-regulation n Provide training on registration and licensing n Support leadership training n Help build collective capacity and independence n Build on existing and culturally accepted forms of collective community organization n Maximize participatory decision processes Discussion It is difficult to work with an unorganized mass of individual small-scale miners. A key step toward a better partnership is to formalize artisanal miners and help organize them into associations, cooperatives, or small enterprises, as appropriate. A clear structure within miners’ groups is needed to establish the roles and responsibilities of key stakeholders. MINING TOGETHER / A Guide for Action Contribute to ASM formalization Benefits Risks • Helps to constructively change the relationship • Relies on all ASM being able to or choosing to dynamic and expand the scope of company enga- formalize gement • Does not, on its own, address security risk of • Promotes good practices and assists govern- willful incursions and malfeasance ment ASM performance and fiscal control • If not managed correctly, can exacerbate the • Enables formalized miners to pay taxes that problem by inducing an inflow of migrants can have a beneficial impact on the national and • Faces cultural resistance from miners to demo- regional economy cratic organization (35) • Gives artisanal miners a voice and increased • Faces opposition if alien organization is imposed ability to articulate needs and to influence govern- • May lead to the formation of an ASM political ment and business policy decisions group with vested interests and little representa- • Promotes self-regulation and community poli- tion of the actual artisans cing • Without adequate resources and governance • Enables companies to engage and negotiate or institutional support, cooperatives and repre- with a body representing the needs and interests sentative bodies may fail, become ineffective and of all miners, instead of trying to manage ad hoc unsustainable, or be captured by unelected elites and individual relationships • Resistance to formalization due to increase tax • Builds the management knowledge base of the and bureaucratic constraints operating environment • Resistance due to middlemen who do not want • Should help reduce dependency to get out of the network CASE STUDY: Las Cristinas, Venezuela cash in almost the total value of their labor by Source: Priester 2007 eliminating the middle players. The local area and communities as a whole benefited from n Context improved environmental and socioeconomic In the Las Cristinas gold district in Venezuela, conditions in the area. The company saw a the Placer Dome company had been granted dramatic reduction in the tension with the local access to a mining concession within an area mining communities and was able to proceed with active artisanal mining. with the development of the property in relative peace and harmony. With the project recognized n Actions as an industry best practice, it boosted Placer Systematically applying a participatory approach, Dome’s international reputation as a corporate the company provided the ASM communities leader in social responsibility. with technical assistance in organization and administration, mining and processing n Lessons technology, environmental management, Local miners are typically open to cooperation, training, and financial support, as well as in but they usually will not accept being patronized. creating a legal market to sell the gold produced. Any viable solution has to be found with them, not This assistance included substantial material mandated for them. Participatory approaches support to the ASM operators (for example, the are paramount, and implementation teams installation of a common treatment plant for the should incorporate not only company technical various artisanal mines). staff but also social experts and small miners, who serve as liaisons and translators between n Results the company and their colleagues. The community-based, small-scale mining operations were legalized, which resulted in higher production, increased income, safer working conditions, and acquisition of new knowledge and training. The safety and security of the project afforded new work opportunities for women and led quickly to the elimination of child labor in the concession. The miners were able to MINING TOGETHER / A Guide for Action Appendix 2 Case Studies (36) ACTION 4: Assign areas for Possible interventions independent ASM n Identify marginal areas of the concession that are subeconomic for commercial exploitation, based on in-house review n Allow organized artisanal miners to work on these designated areas n Allow miners to work on marginal or abandoned sites or to rework secure tailings n Investigate issues of full or partial relinquishment or hold land in trust for ASM cooperative n Examine the mineral potential of the proposed area to be assigned n Evaluate management and self-regulation options for the assigned area Discussion The best situations emerge when mineral resources can be shared on a win-win basis. In several cases, the mining company develops the part of the deposit it considers to be economical and appropriate for large-scale extraction and then lets artisanal miners exploit marginal parts within the properties. Residual sections of the ore may prove to be rich—for example, in the case of a deposit with low-tonnage but high- grade veins—and can be exploited using semi- mechanized means by ASM. However, in situations in which companies allow or enable illegal mining, liability concerns also create a solid case for LSM support toward ASM legalization and formalization and for technical and managerial assistance to improve ASM practices. MINING TOGETHER / A Guide for Action Assign Areas for Independent ASM Benefits Risks • Diverts ASM away from operational areas of • Often faced with a lack of suitable alternative the concession sites with sufficient reserves • Is in accordance with current civil society • Determining initial eligibility, site confinement, demands and policing may still be challenging • Ensures a more efficient use of national mine- • Physical relocation may be problematic ral resources • Exacerbates the problem if not managed cor- • Fosters coexistence and self-regulation rectly by inducing an impromptu influx • Assists governments with objectives of for- • May not have any impact on willful incursions (37) ming artisanal mining zones (experience in allo- and malfeasance cating zones to ASM has provided poor results) • There might be, in many countries, an absence • Provides security of tenure to miners, of legal options to formalize such arrangements improving their creditworthiness and possibly • Assigned land could be acquired by competi- breaking debt-bondage tion or unscrupulous individuals wanting to hold the company to ransom • May or may not give security of tenure to the artisanal miners • Does not fully remove obligation and liabi- lity for health and safety and environmental practices (as well as for security and relocation issues) from the company, which may still be legally accountable and whose reputation may be vulnerable CASE STUDY: Mwadui, Tanzania n Actions Source: Nerys John, Williamson Diamonds Limited 2008. In 2006 De Beers and the government of Tanzania decided to establish a multistakeholder n Context initiative to address the challenges facing the Williamson Diamonds Limited (WDL), a joint ASM sector near the mine in an effort to help venture between the government of Tanzania alleviate poverty and accelerate economic (25%) and De Beers (75%), operates an open pit development. De Beers agreed to provide the diamond mine at Mwadui in northern Tanzania. necessary seed funding, and the project was Diamond mining has been done for 67 years. formally launched by President Jakaya Kikwete ASM has been present in the Shinyanga region and Jonathan Oppenheimer of De Beers at since the discovery of diamonds in the early the Clinton Global Initiative Annual Forum in twentieth century, but it increased in scale September 2006. following a change in national mining legislation The current partners in the Mwadui Community in 1998. Diggers, both legal and illegal, exploit Diamond Partnership (MCDP) are the the alluvial gravels surrounding the WDL lease government of Tanzania, De Beers, WDL, and and make illegal incursions into the concession the eight villages involved. The project is also area itself. The number of incursions and the working to extend the partnership and engage level of aggression shown by the diggers have development partners, government institutions increased in recent years. Approximately 20,000 and programs, international agencies, NGOs, people in the immediate vicinity of Mwadui and civil society groups, especially those with depend directly on artisanal diamond mining for expertise in developing alternative livelihoods their livelihood. For the vast majority, this is a and the extension of social development poverty-driven coping mechanism undertaken programs. The partners in the MCDP appreciate due to the lack of viable alternative livelihood that project planning will be an iterative process, options. Most of the diggers are permanent requiring gradual trust-building, responsiveness, residents in the area, although there is an influx and flexibility. of migrants during the wet season, when there is sufficient water for panning. A diagnostic survey of the artisanal diamond mining and dealing activity in the area and a MINING TOGETHER / A Guide for Action (38) socioeconomic baseline served as the basis for will require in order to operate legally in the area an agreement to demarcate an area within the set aside within the WDL lease. company’s lease for MCDP digging activities. A survey conducted by WDL and De Beers Training will be given in appropriate mining geologists was then used to identify suitable techniques and basic diamond valuation. The ground. MCDP will also assist with the clearance of overburden in the assigned project area (allowing Engagement with the Tanzanian Ministry of easier access to the diamond-bearing gravels). Energy & Minerals about MCDP activities beyond Digger representatives are currently working with the WDL lease resulted in a commitment from a mining engineer to develop suitable low-cost the Ministry to establish a Diamond Valuation technology that can be manufactured locally. Centre, which will give all artisanal miners in Shinyanga the opportunity to have the value of Practical considerations regarding digger their finds assessed. selection, project security, and community self- The research and community engagement regulation are currently being worked through activities that have been conducted recommend with the Community Liaison Team. The MCDP cooperative formation as the best method of mining activities will not be able to involve all the enabling diggers to organize themselves and diggers in the eight villages, and the implications to break the pervasive cycle of debt bondage. of this for both mine-site security and community A Savings and Credit Cooperative Society is a cohesion need to be carefully managed. Ongoing specific type of cooperative that lends itself to engagement with the Ministry of Energy & MCDP’s objectives of sustainable enterprise, Minerals seeks to clarify the respective legal financial inclusion, capacity building, and obligations and liabilities of WDL and the diggers community empowerment. participating in the project in order to mitigate any future confusion or conflict. Other results A draft set of “Mwadui Principles� were agreed include: by the project partners as the standards under which MCDP digging activities would take — The MCDP has been established as a formal place. These principles are now the subject of partnership, and the project has received wider stakeholder dialogue, and the Diamond a positive response from all eight villages Development Initiative is considering their involved. potential for broader applicability. In order to — The election of the representatives on the enable the diggers involved in the MCDP to MCDP Community Liaison Team means that for comply with the Mwadui Principles, a series of the first time these digging communities have a training modules have been prepared in Kiswahili medium through which to voice their issues and covering occupational health and safety, to share decision-making. environmental rehabilitation, the eradication of — Through the monthly forums, the communities child labor, and gender awareness. have received education in mining law and land law and their rights under both. — Awareness-raising has been conducted to n Results inform the villages about the health services The model is actively supported by the Tanzanian available to them at Mwadui Hospital, which, Ministry of Cooperatives and is operational although a private facility, provides the in other mining areas. It is expected that the government’s free health programs, including formation of a cooperative will provide the for HIV/AIDS, malaria, tuberculosis, and “entity� that diggers participating in the MCDP reproductive and child health. MINING TOGETHER / A Guide for Action — WDL management now benefits from (39) formalized two-way communication channels with the surrounding villages. — WDL’s Security and Community Relations functions have been fully integrated into the MCDP project team and planning process. — The government of Tanzania and De Beers are actively participating in the international discourse on artisanal mining. — De Beers has learned some practical lessons that may be applicable to future operations in Angola or the Democratic Republic of Congo. n Lessons Part of the challenge is to transform relationships currently based on obligation and indebtedness and to introduce greater fairness and transparency in terms of valuation and payment. Various options regarding buying and marketing arrangements for the diamonds recovered from the community digging area within the lease are being assessed. The need to assure that the diggers can get fair prices for their production is central, as is the need to protect both the government and De Beers from the reputational challenges concomitant with direct buying arrangements. Other lessons include: — The time required for effective stakeholder engagement and the development of strong relationships — The need to supplement and strengthen traditional intra-village communication processes — The need for flexibility, responsiveness, and pragmatism—some of the eight villages are more receptive and organized than others, for example — The challenge of managing expectations given the scale of the sector and the number of diggers involved — The reticence of some development actors and agencies to engage with the extractive industries and to acknowledge the challenge and opportunity posed by ASM MINING TOGETHER / A Guide for Action Appendix 2 Case Studies (40) ACTION 5: Provide technical Possible interventions assistance n Provide geological, mining, and processing expertise and direct assistance n Ensure occupational health and safety n Oversee environmental management n Provide access to health services in the com- munity n Develop business and management skills n Offer access to credit and to a more profitable market n Evaluate minerals and pricing Discussion Providing technical assistance and capacity building, if well designed and implemented, can help address some of the problems associated with ASM. If a part of the cooperation is technical, the proposed technologies have to be simple, cheap, easy to operate, and easy to maintain, even if they are less than standard quality in the eyes of company engineers and administrators and if the miners themselves want more- sophisticated techniques. Comprehensive action plans to counter negative impacts (for example, environmental impacts, including threats to water quality, biodiversity, and so on) can be promoted through the development of efficient, appropriate technologies and training, awareness campaigns, technology fairs, and links with fair market access and financing mechanisms. MINING TOGETHER / A Guide for Action Provide technical assistance Benefits Risks • Provides a useful entry point for engagement • May not have any impact on willful incursions • Can be an incentive for formalization and • Should not be given freely, or the company risks regularization being accused of promoting and assisting illegal • Promotes good practices, increased efficiency, activity (must be linked to formalization and regula- and less destructive environmental practices rization of miners) • Technical issues are often the easiest to solve • Training in occupational health, safety, and en- • Builds social license to operate vironmental practices must be relevant to miners’ • Utilizes key skills of many mine-site staff needs and realities, or it risks being time-consu- (41) • Increases communication between LSM and ming and ineffective ASM, thereby fostering mutual understanding • Providing training and technical assistance • Allows training on other key issues, such as without matched inputs or entry fees from miners health, to be delivered and communities may result in the devaluation in perceived benefit of services and high dropout rate • Social barriers can influence acceptance, dis- semination, and overall assimilation of advice In some countries, large miners may be the only CASE STUDY: Boroo, Mongolia available source of the technical expertise that Source: Priester 2007. ASM miners need to improve their operations. Increasingly, companies are willing to share n Context that knowledge, either directly or through the On the concession of Boroo, conflicts developed appropriate government agency, international over the responsibilities for safety incidents financial institution, and community bodies. involving illegal ASM. Small informal mining brigades were organized and equipped by local Technology is another key issue for small-scale business people. They were mining small quartz- miners, as it determines how, how much, and gold veins on the Boroo concession while Boroo how safely they are able to mine the land. The Gold was mining only the massive hard-rock gold company can assist by, for instance, initially deposit. financing the purchase of equipment. Note that the equipment must be appropriate: buying n Actions a 20-ton hammer mill when the miners have Support for Artisanal Mining Project (SASM) was traditionally used a pick and a rock to crush ore provided with funding from the Swiss Agency for will only lead to frustration, breakdowns, and, Development and Cooperation, involving the eventually, hard feelings toward the company. It Mining Rescue Service of Mongolia. Boroo Gold is better to start simply and gradually increase agreed to negotiate after the artisanal miners in sophistication. The company must also received professional health and safety training be cognizant of the point when small-scale and environmental introductions from the SASM (artisan) mining crosses over to industrial-scale project and the Mining Rescue Service. mining. One technical area often overlooked by companies is how to improve the mining n Results practices of small-scale miners themselves. The artisanal miners and the mining company Technical information, such as proper tailings signed an agreement allowing the miners impoundment procedures and handling of to normalize their operation and to invest in mercury, is likely to stay in the community long physical infrastructure and exploration in a safer after the company leaves. Collaboration with a environment; the company agreed to waive its respected third party (such as a local university responsibility regarding health and safety potential or NGO) is often desirable: it lowers the cost to liabilities with respect to the artisanal miners. the company, increases the knowledge basis of a local institution on technical issues related n Lessons to mining, provides third-party objectivity, and Providing support to solve safety and other problems increases the likelihood that this knowledge will related to the responsibilities of the formal partner stay in the area after the company leaves. may be a viable option to create a platform for further negotiations and arrangements. MINING TOGETHER / A Guide for Action Appendix 2 Case Studies (42) ACTION 6: Employ artisanal miners Possible interventions as subcontractors n Develop, through participatory processes and technical assistance, independent micro businesses and SMEs and integrate them into the supply chain n Enter into joint ventures or mining contract agreements with ASM nFacilitate the formalization of ASM around the mine area n Develop SME mining ventures with labor- intensive good practices and ASM practices with appropriate management structure Discussion Artisanal miners hired as subcontractors are formally contracted to provide the mine with different services. Creating labor services for artisanal miners in various steps of the mine supply chain can drive them to formalization and provide LSM with a useful workforce. This can create a relation of confidence that will be needed for further processes. Local miners are typically open to cooperation, but they usually will not accept being patronized. Paternalistic approaches have mostly failed. Empowerment and real participation seem to be the most promising ways. MINING TOGETHER / A Guide for Action Employ artisanal miners as subcontractors Benefits Risks • Promotes livelihoods and rural and • SMEs need to be linked to alternative regional development markets to avoid creating dependency on mining and to build sustainability • Develops local economy • The company remains responsible for • Contributes to regional and national good supply chain practices development (43) CASE STUDY: n Lessons Bayankhongor, Mongolia As an additional safeguard, the company insisted Source: Priester 2007. that many of the ASM cooperative members be jobless relatives of company mine workers. n Context This reinforces the bonding between the ASM A long-established placer gold mine became co-op and the company and assists in social overrun by herders who resorted to panning after comprehension between both parties. becoming destitute following climatic disasters (“dzud�) in the Gobi Desert that decimated their herds of livestock. No alternative livelihood other than ASM was available to the herders. n Actions Negotiations took place and the mining company (Mongobulgargeo) agreed to provide a limited number of panning sites for artisanal miners, who were required to form a loose cooperative. The company’s mechanized method of mining was having a hard time recovering gold from the lowest part of the placer, where it was irregular and rested on rock. The ASM cooperative members were allowed to dig and bag the gold ore left behind by the machinery. n Results Some of the gold lost by the company is now recovered by the artisanal miners. The artisanal miners sell the gold to the company, which boosts the company’s production and profits. The government receives 5% royalty that it otherwise would not receive. The company is able and willing to pay a better price to the artisanal miners than the many illegal gold traders in the area. The artisanal miners benefit too: they receive some security of tenure, they have rights to take material and wash it, they have panning pits dug and filled, and they are within the zone protected by company security. The on-site presence of the ASM cooperative is a deterrent to roving artisanal miners who would otherwise disrupt company operations, as the ASM co-op members have an interest in deterring nonmembers from trespassing. MINING TOGETHER / A Guide for Action Appendix 2 Case Studies (44) ACTION 7: Implement a safety and Possible interventions security plan The presence of artisanal miners on LSM property presents high safety and security risks for both the miners and the company. Two different types of action can address this issue, depending on whether the miners live within the perimeter of the operation: develop a safety and security plan and/or arrange resettlement. n Implement a comprehensive plan where safety and security aspects are integrated in a collaborative approach, and prevent entry to the active mine though effective engagement with ASM and communities. n Identify, assess, and relocate the affected populations or communities to appropriate alternative sites in accordance with international codes and standards. n Prepare and implement community development plans and alternative livelihoods programs when the company is the cause of population displacement. Discussion Any incidents involving safety or contamination will likely be seen as the fault of the company. Gary O’Brien of Rio Tinto notes that “the mine manager must think seriously before calling in the authorities or the police. While the security of a mineral title is paramount, it pays to look at the situation through the eyes of those opposing the large company’s presence. Calling on the authorities to protect the rights and personal security of a large operation may provide short- term relief – but it is unlikely to be a long-term solution. Inappropriate use of force can embitter MINING TOGETHER / A Guide for Action memories for generations and sour relationships organizations. All police underwent accredited for years to come. The result can be blockades, training prior to deployment. The program kidnappings and sabotage: financial and was extended to local police. A Human Rights physical setbacks to the company and social and Protocol Register was created, and human right economic damage to the community� (O’Brien standards were embedded into PJV standard 2006). operating procedures. Police operations focus on enhancing general community security as well as targeting illegal miners and associated CASE STUDY: Porgera, PNG crime. Source: Porgera Joint Venture, FDC Workshop, 2008 plus website. In parallel to the illegal mining challenge, civil (45) unrest increased when in 2007 local landowner n Context groups protesting over proposed relocation Porgera Gold Mine, in Enga Province, PNG, is a settlements were successful in peacefully joint venture between Barrick Gold Corporation halting mining and processing operations at (95%) and Mineral Resources Enga (5%, split the mine. The suspension lasted for eight days, between the Enga provincial government and during which various local landowner clans, the Porgera SML Landowners). Illegal mining PNG government representatives, and PJV mine occurred from the start in 1990. Initial police management eventually agreed on how best to and security presence acted as an effective move on. deterrent, but the past five years have seen an escalation in frequency, numbers, and n Lessons propensity for violence. ASM workers—mostly Attention was focused on preventing entry to young men recently moved in the area— the active mine areas through more effective generally work individually or in small groups engagement with local leaders, education of along family lines, showing no evidence of young people about the safety risks involved, organized processing. Illegal mining is mainly a and improved coordination between mine safety issue (for employees and ASM workers), security staff and public authorities. and today artisanal mining represent one of the The challenge continues and complementary most important business critical issues facing actions are being planned, such as: Porgera Joint Venture (PJV). Incursions total – Enhancing the collaborative approach between 1,000 and 2,000 per week. – Empowering landowners to take a greater role n Actions – Improving government services Barrick recognizes the risks that illegal mining – Addressing law and order issues has on local communities and the operations. – Seeking additional external assistance An Illegal Mining Action Plan was drawn up, and – Expanding socioeconomic development an Illegal Mining Control Unit plus dedicated programs manager was set up. The approach included – Enhancing engagement processes with the studies, risk assessment, issue awareness, community stakeholder buy-in, increased community – Developing alternatives to illegal mining engagement processes, and changes to mining – Strengthening and supporting traditional and security operations (a fence around the active culture areas). A Community Illegal Mining Committee – Continuing awareness programs was launched to increase engagement with – Enhancing education and training landowners and the community. The mine opportunities. employs its own security force of between 400 and 500 persons. n Results The PNG National Court sanctioned the process, and the tripartite approach (government, community, and PJV) helped implementation. Police Mobile Squads were deployed. A tripartite approach was also taken with government and International Human Rights MINING TOGETHER / A Guide for Action Appendix 2 Case Studies (46) ACTION 8: Promote Possible interventions diversification n Demonstrate the feasibility of non-mining businesses and related market niches n Develop technical assistance in other sectors n Provide incentives through access to credit n Develop a Community Development Foundation to be integrated in local development plans n Provide related training and capacity building Discussion When opportunities can be identified, the LSM sector can play a role in turning artisanal workers away from mining by promoting other income- generating activities. Technical assistance in new but related skills, entrepreneurial and accounting management, and access to credit facilitation programs are key elements to diversification. While there are examples of successful diversification programs focusing on ASM communities, few have been reported in which a specific link between LSM and ASM was identified. New initiatives related to ASM community development around LSM are presently under development in Katanga (Kolwezi) and Tanzania (Mwadui) and are already bringing new lessons. Small-scale miners often identify the development of economic alternatives to mining as a top priority. Miners frequently understand that they are dealing with a finite resource and that community programs that offer a diversity of economic options for local residents can MINING TOGETHER / A Guide for Action Promote diversification Benefits Risks • Builds social and political capital and • If insensitively and ineffectively planned centrally won license to operate in-country or managed, may increase vulnerability and • Should help reduce dependency poverty in affected communities or may • Promotes good practices, increased jeopardize the company social license to efficiency, and less destructive operate environmental practices • Has little immediately tangible mine-site • Increases communication and benefits (47) understanding between LSM and ASM, • Social barriers can influence acceptance, thereby fostering mutual understanding dissemination, and overall assimilation of • Allows training on other key issues, such advice as health, to be delivered • SMEs need to be linked to alternative • Promotes livelihoods and rural and markets to avoid creating dependence on regional development mines and to build sustainability more effectively build sustainability in an area in product design and production capacity. over the longer term. Here again, collaboration with local institutions or NGOs offers distinct n Results advantages for increasing the impact of any Marketing, a main focus for cash-strapped SMEs, company-supported program. has been addressed through group marketing events such as “Business Encounters,� which spread costs and offered broad exposure to CASE STUDY: Yanacocha, Peru firms shopping for vendors. Based on what local Source: IFC Web site 2007. businesses identified as a critical need, advisory services programs were developed to improve n Context financial management and business processes. At Minera Yanacocha, Latin America’s largest These programs helped participating SMEs gold mine in northern Peru, the population has become more creditworthy, opening up a wider swelled from 30,000 to 240,000 in 10 years. range of financing options from local banks and About 8,000 new jobs related to the mining microfinance institutions. activity have been created, directly or indirectly. n Actions The Minera Yanacocha SME Linkages Program was designed by IFC to build a diversified and sustainable economic base extending beyond Yanacocha’s mining operations. The program worked to strengthen SMEs. For those within Yanacocha’s value chain, primarily in the transportation and construction sectors, supplier development efforts centered on a total quality management program to improve productivity and optimize company management abilities. The program focused on raising safety, environmental, and business standards. The Minera Yanacocha Program extends to SMEs outside the company’s value chain as well, particularly in the handicrafts and agribusiness sectors. For example, in the ceramics and textiles sectors, local artisans have received technical and managerial training to upgrade their skills MINING TOGETHER / A Guide for Action Appendix 2 Case Studies (48) ACTION 9: Create mine-site Possible interventions employment n Recruit within the local population n Undertake intensive local training and apprenticeships (including for artisanal miners) to address gaps in skills n Employ artisanal miners (mining, construction, security) n Employ artisanal miners as salaried workers or share revenue through a contract mining agreement that uses organized and formalized ASM and delivers Run of Mine to the company mill Discussion In some cases, formal industrial mines provide employment to artisans, which may be as tenuous as employment in the informal sector. Pervasive “hire-fire� policies and the failure of many artisans to work on a reliable basis often inhibit development of more formalized working arrangements. Also, license holders frequently hire poorly skilled local miners who use primitive methods, often without the provision of safety gear. In many instances, license holders “employ� and remunerate artisans on a per volume basis, an arrangement that generally facilitates ongoing employment of miners as a trade-off for exploitative purchase prices. MINING TOGETHER / A Guide for Action Create mine-site employment Benefits Risks • Combines ASM skills and experience with • Often faces a scarcity of skilled or semis- LSM safety, best practices, and efficiency killed labor • May be commercially and economically • Artisanal workforce will always massively viable for some LSM sites outnumber available jobs in even the most ambitious recruitment programs • Can help artisanal miners make transition (49) to small-scale mining • Promotes livelihoods and rural and regional development CASE STUDY : Kinsevere, Katanga, supplied part of the materials used to build the Democratic Republic of Congo processing plant foundation. Source: Joseph Mbaya, Anvil Mining 2006. n Context Artisanal miners seeking income opportunities were invading the copper mining concession of Anvil Mining in Katanga. n Actions The adopted strategy was based on the registration of artisanal miners and their progressive sensitization (presentation of choices, incentives/motivations). Direct employment was offered as well as propositions for alternative options. Training sessions were organized and a gravel SME was created to supply the plant foundation. The company undertook the following actions in partnership with PACT Congo: – Working with local ASM administrative body to organize and provide technical support to diggers – Establishing a miners committee (“comité de creuseurs�) – Signing an agreement (“protocole d’accord») – Providing literacy and savings training to women – Providing apprenticeships and financial assistance to the miners – Establishing a health clinic n Results Four hundred former artisanal miners were employed in construction and given follow-up training for skilled posts. A contract was signed to employ 60 creuseurs to make gravel through the use of appropriate technology. This gravel MINING TOGETHER / A Guide for Action Appendix 2 Case Studies (50) ACTION 10: Support access to basic services Possible interventions Discussion n Contribute to local infrastructure development In many developing countries, government (roads, electricity, water) or to education and capacity and resources are insufficient to provide health services (schools, hospitals) basic services. LSM companies can often find themselves expected to provide such local n Get involved in regional development public goods as education, health care, social planning infrastructure, water and sanitation, and other services. If agreed, related programs should be n Communicate information about services designed in coordination with local and national provided on a reasonable and regular basis authorities, to make sure that the companies do not become a surrogate government––a n Work with NGOs or other associations to highly unsustainable situation. They should be raise awareness on sustainable development managed carefully because public expectations (environment and social) can become unlimited, especially when needs are perceived to be easily satisfied, and can n Contribute to positive community development exceed reasonable interventions by LSM. initiatives Experience shows that strategic community development planning or community investment programs that take these issues into account are more sustainable and have a greater chance of being successful. Support access to basic services Benefits Risks • If sensitively and effectively planned and mana- • Lack of government involvement can be dama- ged, may help contribute to sustainable rural and ging and increase company exposure regional development • May not eliminate or reduce invasions and incur- • Could ensure site integrity and prevent security sions, especially in conditions of migrant and rush breaches ASM • Builds internal capacity and a corporate knowled- • f not properly set up and managed, can entail ge base of the operating environment significant environmental and social liabilities for • Can promote livelihoods and rural/regional company development MINING TOGETHER / A Guide for Action CASE STUDY: Geita, Tanzania n Results Source: Anglogold Ashanti 2005. Geita is now the site of a pilot project to tackle artisanal mining, developed following a request n Context to the mine by Tanzanian President Benjamin Problems associated with artisanal mining came Mkapa to assist in managing the phenomenon. to the fore at Geita mine in Tanzania in 2005 when approximately 7,000 gold seekers invaded Follow-up awareness campaigns have been the area after word spread that a large nugget planned, and the mine is also looking to (51) of gold had been found by artisanal miners. establish a working partnership with the Global While the majority of the miners left on their Mercury Project (GMP) of the United Nations own accord after management made appeals Industrial Development Organization (UNIDO), to vacate the lease area, the police had to be which is aimed at reducing mercury pollution summoned to remove those who resisted. by artisanal mining through the introduction of cleaner technologies. Tanzania is one of six n Actions countries participating in the GMP, which has A workshop attended by 95 artisanal miners was offered to supply equipment to artisanal and held in April 2005. A joint initiative between the small-scale miners in the Geita area. mine and the UK’s Department for International Development—whose interest is aligned with the While each country presents its own set of U.N. Millennium Development Goals of alleviating issues with regard to artisanal mining, AngloGold extreme poverty, reducing child labor, and Ashanti believes that elements of the Geita combating HIV/AIDS—the participatory workshop approach can be transferred to the company’s addressed itself to all issues associated with other operations. A strategic plan is currently artisanal mining. During discussions it emerged being drawn up for its Siguiri mine in Guinea, that the miners wanted more information on where the issue of artisanal mining requires topics like access to small business loans, urgent attention. The company has adopted a technology, safe working conditions, and better “push and pull� approach, protecting the mine’s mining techniques. assets while at the same time gearing up to A trade fair (informed by discussions held at assist miners to become legal entities. the workshop) took place, aimed at providing greater information on the topics raised at the n Lessons workshop. A number of local and international Says Charles Loots, AngloGold Ashanti’s Local participants were present, including the National Economic Development Manager, «We realized Microfinance Bank, providing advice on opening we had to adopt a multistakeholder approach accounts and requesting investment loans; the and include as many parties as possible. Also Vocational Education Training Authority, which essential to successfully tackling the problem was explained how to become competent in artisanal buy-in from local and national government.» mining and even qualify for a national diploma in the practice; the Small Industries Development Loots adds that one possible solution in Organization, advising on alternative means of regularizing artisanal mining (though not employment and the dangers of using mercury specific to Geita mine) would be to section in gold extraction; and the International Labour off areas within AngloGold Ashanti’s lease Organization, which spoke out against child labor areas that are not necessarily viable for the and unsafe working conditions. Also represented company to mine but that may well be mined were other large mining companies operating in through artisanal mining. This would meet the the area, which realized the need to act as a objective of legitimizing these operations while group, as well as the Mwanza Regional Miners at the same time eliminating the disturbance of Association and the Tanzanian Women Miners’ company operations. It would also facilitate the Association. In order to transcend language, establishment of constructive dialogue between educational, and cultural barriers, concepts the company and the artisanal miners. and messages were conveyed through industrial theater and later converted into pictorial form for reinforcement. MINING TOGETHER / A Guide for Action MINING TOGETHER Large-Scale Mining Meets Artisanal Mining A Guide for Action C ASMCommunities and Small-Scale Mining CASM Community and Small-scale Mining World Bank Group, Mining Department 2121 Pennsylvania Avenue, NW Washington DC, 20433, USA Website: http://www.artisanalmining.org