Namosi villager Wati Nataro ... what does the mine future hold for people like her? Photo: The Fiji Times

Pacific Scoop:
Analysis – By Dr Wadan Narsey

Many wrongdoings of the Fiji military regime can be reversed when an elected, accountable and transparent government returns to Fiji.   But a wrecked environment is not one of them.

It may not happen.  Or at any rate the event may happen at great cost, as Japan sadly found with the unexpectedly huge tsunami and resulting nuclear disasters.

Plans are underway for a mining company- Namosi Joint Venture (NJV) (made up of Newcrest (Fiji) Ltd, Mitsubishi Materials Corporation and Nittetsu Mining Co. Ltd.) – to begin a mining venture based on “open cast mines” in Namosi.

Mt Kasi mine in Namosi ... environmental questions.

The area is known to have large reserves of copper – and also gold.

The military regime has started “community consultations” which will allegedly feed into terms of reference (ToR) which will be given to the mining company to allegedly “guide what should be done as part of the EIA (environmental impact assessment)”.

Why to the mining company?

How useful are these consultations for determining a terms of reference for an EIA? How independent will be the IEA?  How thorough will be the EIA?  How will the EIA be used? If the results of the EIA are negative enough, will that be end of the project?

Or will this regime go ahead anyway, with or without environment safeguards, because they are desperate for economic growth and increased government revenues to continue to finance their bloated military budget?

Soon this unelected, unaccountable, non-transparent, illegal military regime will be making critical decisions on the mining venture. Why are they?

If wrong decisions are made there may be immense risk posed to the Namosi environment, and the reefs and oceans into which the spill-off from the mine will inevitably flow. Also likely to be affected is the tourism industry on the south-west coast of Viti Levu.

All indications are that environmentalists and concerned people face an uphill battle to preserve a valuable part of Fiji’s natural environment, for the future generations.

Why now?
A Namosi copper mine has been talked about for more than 30 years.  Why this sudden burst of activity now?

This graph (from Infomine.com) explains it all: the price of copper having hovered around US50c between 1997 and 2003, shot up to US$3.50 in 2006, fell to about $1.50 around 2008 and has been rising since then.

It is now above $4 per kg – or eight times higher than 15 years ago.  Even if it falls to half this level in the long term, this has the potential to be a very profitable mine.

Gold prices ... a "miraculous rise". Source: Infomine.com

There are also reasonable quantities of gold associated with the mineral deposits in Namosi, and gold prices have also had a miraculous rise.  From being below US$500 an ounce up till 2003, it has steadily shot up to more than US$1500 per ounce.

There is every indication that the rise in gold prices will not be reversed.  There is increasing political uncertainty in the world, the US dollar has declined as a reserve currency for the rest of the world, stock markets are increasingly fragile after the global financial crisis, and there are other fascinating reasons such as the century old love of China and India for gold, boosted by their recent meteoric rise in global international power.

Not only has the Vatukoula Gold Mine became a bonanza, but the gold portion may be the icing on the cake for the Namosi Joint Venture copper mine.

In short, the dramatic rise in copper and gold prices has made the mineral resources in Namosi well worth investing in.

The huge investment required will be even more profitable if the mining companies do not have to spend too much to ensure environmental safety.

And a good EIA may require expensive safeguards which would reduce the profits of the mining companies

Copper prices ... fluctuating but now on a rise. Source: Infomine.com

Good EIAs immensely difficult
A good environment impact assessment tries to examine all the impacts (environmental, economic, and social) that the mine will have, including the impacts on all the people, the current and future generations and all the natural species, known and unknown.

To do a good EIA even in a developed country is an incredibly difficult exercise full of fundamental disagreements between environmentalists and economists, between environmentalists themselves, and between economists themselves.

Developed countries usually have some understanding of what species there are in the particular environment, from birds to butterflies, to all kinds of species of plants and living organisms, which the average person has no idea of.

But they also have huge vacuums of knowledge and base data about species they know to exist, and knowledge nightmares about species they have yet to discover, but which they know are there, simply because of the past history of discovering new species in such areas.

The difficulties are even more immense in developed country coastal regions, reefs and oceans where there is an absolute dearth of scientific knowledge.

Nevertheless, fool-hardy economists (usually for a nice consultancy fee) take the little bits of knowledge that they do have about the environment they know, and use all kinds of debatable methods to put a monetary value on the likely environmental damage that the prospective mine may cause.

Many of these methods depend on putting market values on costs: such as the value of lost crops, timber, medicines, marine resources, etc. Or they hopefully ask “what would you pay to enjoy this environment benefit?”

Of course, the market value is high if those being asked are rich.  But most often, those being asked are too poor to even feed, clothe and educate themselves, as in Namosi.  What would they offer to pay for a clean environment?

Economists are also known for quite amorally concluding that for a project to go ahead it only has to have “net positive benefits”- ie benefits are higher than losses:  losers don’t have to be actually compensated to have a “an improvement in the economy”.  (Bad luck, losers!)

Of course, no EIA can ever estimate the value of the potential costs to future generations who cannot be asked anything at all.

Forget also about the good environment things that exist which scientists know they know next to nothing about.  And don’t even think about the potential loss of good things which scientists don’t even know the existence of,  but can put a high probability on them existing!

EIAs in Fiji even harder

As with most developing countries in the world, Pacific countries like Fiji, PNG, Solomon Islands and Vanuatu, have very little documented scientific knowledge of what exists in our land environments.

There is even less known about what exists in our marine environments, except that for drug companies the world over, the tropical marine resources (including Fiji) have been one of the last frontiers for exciting new drugs and medicines waiting to be discovered and patented.

Just down the Namosi coast is the Great Astrolabe Reef – one of the world’s largest barrier reefs, and one of the world’s best diving locations. It has an incredibly varied topography (including the shallow and deep), goodness knows what marine species, and considered to be ideal for declaration as a marine park and a world heritage site.

How many other reefs are there which are not current tourism locations, and which may be affected by the proposed Namosi copper mine?  Does the tourism industry care enough to taken more than a token interest?

Who will do the Namosi EIA?
According to media reports, the EIA study would be conducted by international consultancy firm Golder and Associates, and the Institute of Applied Science from the University of the South Pacific.

The Institute of Applied Studies can be expected to do the best they can.  But they will be hampered by the lack of most basic information about what exists in that Namosi environment, and all the areas in the surrounding oceans likely to be affected by leaching chemicals.

Local consultations are not going to be much help or any surprise.  They will give a little information about crops, fisheries and bush medicine they are going to lose. (Villages will be busy planting new crops already to maximise their claims – as villagers have done everywhere in Fiji where roads have been built!) .

But local villagers will know very little about the potential biodiversity damage to the environment.  Despite all their good intentions and efforts, there is no way that USP’s Institute of Applied Studies, will be able to conduct the thorough environmental studies that are needed.  Such studies would take years, not the six months or a year that the NJV is currently expecting.

The chosen company, Golder and Associates are known to do EIAs.  But their website also makes clear that they do far more than EIAs for the mining companies.
Golder’s advertised services include “Surface and underground mine design and production optimisation, including geology, geostatistics, block modelling, grade control, pit slope design and stope design, ground control, backfill design and ventilation; Hydrogeology, geochemistry and water management;  Design, planning and implementation of all types of tailings and waste rock management systems; thickened-tailings and paste-tailings deposition and plant design & construction; Preparation and implementation of closure plans that meet the needs of local stakeholders and regulatory agencies.”

Clearly, the EIA may be only the beginning of the money making for Golder and Associates, out of the Namosi Joint Venture project.

How will the EIA be used?
An EIA can be used in any number of ways, which I simplify to three:

1.   The most genuine and thorough EIA is used to help in the actual decision-making.  If it is found that the costs may be so great as to totally outweigh all the other benefits to the country, the difficult decision may have to be made to not approve the mine.

2.  If the EIA finds that the benefits will far outweigh the likely costs, AND the costs can be minimised, AND “losers compensated”, then the mine may be approved PROVIDED that the mine puts in place the required safety mechanisms.

3.  The EIA may be done (whether well or poorly) and be used to just “rubber-stamp” the mine, regardless of whether safety mechanisms are put into place or not, or adequate independent policing mechanisms established.

The NJV country manager is reported to have said, the studies “will gather specific environmental and social data along with other information to identify potential impacts on the environment and provide options on how they could be managed”.

Has the military regime already agreed before the EIA has even been done, that the mine will go ahead, and the EIA will merely provide options on how damage “could be managed”?

You can decide at the end of this article, which is the likely outcome in Fiji today.

What’s in it for the military regime?
The mining companies will be rubbing their hands with glee because they love unelected military regimes, unaccountable to the people.

They know that with the Fiji economy in the doldrums, with the sugar industry collapsing, with no major new investments on the horizon, the military regime is over a barrel, desperate to get the economy going.

The regime will not particularly care for a proper thorough independent EIA which may delay the mine for a few years, and so they will not demand stringent environmental precautions.

The military regime may even be pressured to give generous tax breaks to get something going.

The current judiciary may be expected to reinforce the military regime’s decisions, and their military decrees which state that the regime may not be challenged on anything. So forget about legal injunctions in Fiji.

International courts will also legitimise agreements made even with illegal regimes, as long as they have demonstrated full effective control, with no obvious challenge to their rule. Yes – that’s Fiji now.  Anonymous bloggers don’t count.

Having closely watched events in Fiji for the last five years, the mining companies will also know that they need to please just two key military regime persons – I forget their names – to ensure that their mining interests are safeguarded.

The collaborating local interests
The mining companies are well aware of successful strategies used internationally (and in Fiji) by which local interests are pacified and the support of key movers and shakers guaranteed.

The local villagers will be given their rolls of banknotes to compensate them for their “lost” incomes from crops and environmental resources, and many may be given labouring jobs associated with the mines.

A few key chiefs and local leaders will be appointed in public relations or labour management roles.

There will be a few hundred thousand dollars spent on schools, health centers, water tanks, play-grounds, and sports teams.

The local business community (building materials suppliers, the banks, the insurance companies) will be rubbing their hands with glee as they face the prospect of some improvement in the economy, and their bank balances.  They and their families will not be retiring in Fiji’s environment.

Key civil servants (and the military regime leading lights) will be taken on “all expenses paid” tours (like the recent bond selling road show orchestrated by ANZ) of mining sites throughout out the world (not Ok Tedi, of course) where model mining techniques and safeguards may be “demonstrated”.

Multinational corporations know quite well that with hundreds of millions of dollars of profits at stake, a few millions spent on social lubricants applied to these key persons, would be money well spent in ensuring their ready cooperation. Fiji abounds with examples of eager politicians and top civil servants willing to engage “privately” with business corporations, international or local.

Expect no civil servant to stick their necks out for the Fiji environment against this ruthless military regime, especially as they can expect no protection from the pliant Public Service Commission, if their heads are chopped off.

If environment disaster hits?
Fiji environmentalists (there are quite a few) well know what has happened to the interests of the local people and the environment in major mining disasters overseas.

Probably the most useful for Fiji to learn from is the massive Ok Tedi Mine disaster in Papua New Guinea, also an “open cast” mine involving extraction of copper and gold.

There the “tailings dam”, which was supposed to hold all the poisonous wastes from the mining, collapsed, yet the mine was allowed by officials to continue, despite the known widespread damage to the environment.

The Ok Tedi Mine generated massive profits for the Ok Tedi Mining Limited (BHP Billiton), huge taxation revenues for the PNG government and the provincial government, and the leading political parties and politicians.

Eventually some local communities managed to win large development funds as damages from the Ok Tedi Mining Limited.

Other losing groups are still litigating- but it is an uphill losing battle pitting the limited local resources (the Davids) against the massive (Goliath) multinational corporations able to hire large teams of lawyers, scientists and public relations companies.

If you think it won’t happen in Fiji, have a look at the excellent work of Dr Atu Emberson Bain which gives the ongoing Fiji example of what happens when local communities and workers came up against a large gold mining company.

Dr Bain has well documented in books, articles and video documentaries, the disastrous impacts on workers and the environment, caused by an irresponsible profit-focused mining company, supported by equally uncaring governments.

The future
Those who care about the Namosi and Fiji environment will have to fight to ensure that a proper independent EIA is carried out; that the right decisions are made as to whether the mine should go ahead at all; that adequate environment safety precautions will be put in place and policed; and that the local economy and people and affected groups get their proper compensation.

This is going to be an uphill battle made more difficult by the continuing media censorship.

The local Namosi communities cannot be expected to safeguard the national interest as their immediate financial and economic benefits are likely to be very large indeed, and will take many of them out of poverty.

But the Namosi and the surrounding environment does not belong to the current generation in Namosi or even the current generation in Fiji.

Remember  what Mahatma Gandi said (oft quoted by Greenpeace)

“The earth, the air, the land and the water are not an inheritance from our forefathers but on loan from our children. So we have to handover to them at least as it was handed over to us”.

Environment NGO activists like Greenpeace, will need all the help that the public and our expert environmentalists can give (probably on the quiet).

The mining company (Namosi Joint Venture) will be making a huge investment, which still has inherent mining risks, but which promises massive bonuses (millions) to the executives, if large profits are made for the shareholders.

As the global financial crisis showed, morality and the interests of the general public (or the environment), just do not come into the picture when it comes to corporate decision-making with such large pay-offs.

It is not a matter of labeling them “good” or “evil” corporate executives: that’s just how the corporate capitalist world operates.

But if the current Fiji people fail to protect the environment in such mining projects, they will have failed the future generations, whatever benefits may be enjoyed by the current generation.

Need for government accountability
Ultimately, Fiji people will have to realize that the struggle for the environment (like the struggle for the FNPF pensioners, or for workers and unions’ legitimate rights, or for religious groups to have their gatherings) is part of the bigger battle which will not go away:

An unelected illegal military regime has absolutely no right to be making any decisions on the Namosi Copper Mine which will affect generations to come. They should leave all such decisions to elected governments.

Of course, elected governments have a poor environment record in Fiji as well.

For 17 years, the Alliance government was in the pockets of the Emperor Gold Mine, which was even accused of having a role in the 1987 coup which removed the Labour/NFP government (which unwisely talked about nationalising the gold mine); Rabuka’s SVT government was sympathetic to the gold mine; as was the Qarase government whose control of Senate resulted in the rejection of Dr Atu Bain’s 2003 motion for an independent inquiry into the gold mine.

So elected Fiji governments are no guarantee that justice will be done to the environment or to the mine workers.

But at least they may be rejected at the next election, should their failures be bad enough to displease the voters.

I doubt, however, if this military regime is going to be dismissed by votes, any time soon.

The Fiji public may soon forget what a vote is.

Just as they have forgotten what a free media means.

Dr Wadan Narsey is an independent economist and currently on sabbatical. These are his personal views.