The Mongolian Mining Journal /Dec.2019/
N. Batbayar, Head of the Mining Inspection Department of the Specialized Inspection Agency, tells G. Iderkhangai that much of the present emphasis on responsible mining is misplaced. In any case, why should only mining companies be “responsible”?
Everybody wants to have more responsible mining in Mongolia. With your work experience, do you think it is a realistic expectation?
I have always found it strange that responsibility should be demanded of only one sector. Only mining companies are expected to pursue transparent and responsible policies and activities. Should this not be applied to units in all sectors? Also, in general talk about responsibility in mining, the emphasis is always on the environment and relations with the government, and on exactly what has been given to the local community, but rarely is it considered what contribution mining has made to the economic prosperity of the country. Of course, it is right to be concerned about the environment, but I would think human development comes before it.
How effective would be the recently developed methodology for assessing responsible mining?
We have long felt the need to clearly define what constitutes responsible mining and how a company’s performance in this regard should be assessed. Now, in cooperation with the Environment Governance section of the UNDP, we have issued a handbook that covers both aspects. We have proposed to MNMA that it uses the handbook to promote responsible mining among its members.
Eight MNMA member companies have joined the Voluntary Responsible Mining Code. It would be interesting to assess these companies’ level of responsibility from their actual performance. We cannot just say, “You have to be responsible” and a company cannot then answer, “We are responsible”, without making it clear how their claim can be supported. Only regular self-assessment will keep a company on its toes and prod it to do better. The Responsible Mining Initiative Project implemented in 2008 used eight criteria, but we now feel only five of them are really important, among them corporate governance and transparency.
In Mongolia, most mining companies are fully, or at least mostly, owned by an individual or by partners. They look at the mine as their personal property. This is in contrast to the world norm of mining being the domain of mostly public companies, with many shareholders. They have a Board of Directors that adopts policies and implements them. If we work like this, the value of the mining sector will rise in society. A company will be required to be transparent about its operation and finances and, most important, there should be a clear statement on fees and taxes it pays to the local budget, and on any donations it might make. This should be apart from the information it might include in its annual Extractive Industries’ Transparency Initiative report.
A company’s human resources policy determines its ‘responsibility’ in several aspects of employment: providing the disabled with jobs, ensuring gender equality, promoting employees to higher positions and to train them for this. A company has also to make sure that these commitments are not only on paper, but an integral part of its internal procedures. The issue the world prioritizes is safety of employees at their workplace.
Some feel that only large companies, such as the eight that have joined the Code, have the resources to implement this methodology…
These companies might feel that they are “responsible” enough in their own practices on their own assessment and so they give the impression that the Specialized Inspection Agency sets impossible goals and promotes a methodology that requires large financial and human resources – beyond the means of most companies in the country -- to be used. Given the lack of investment, a feeling is being encouraged that a company which has invested should be allowed to operate as it wills. This is a very unsound way of looking at things. Mining is not just a tool to earn money. Mining in Mongolia has its own history and ethics. It needs large investment, sophisticated expertise, and new technology. We cannot allow anybody and everybody to become a miner solely to make money for themselves. That would make a mockery of all talk about responsibility.
How far can we carry eco-friendliness? Does not any mining operation cause damage to the environment to some extent?
Causing the least damage to the environment should be a clear priority for any company, and there should be a unit solely to monitor this. I have been in charge of the Environment, Geology and Mining Inspection Department of the Specialized Inspection Agency since 2009. At that time not many companies had anyone in charge of occupational safety and environmental issues, while today most large companies have a special unit for at least the former.
However, it is interesting that these are not always so popular. The production department employees say this hinders their work and I am not sure how keen companies are on implementing safety requirements if they affect output, but of course they have to do it as, if something does happen, they will receive very adverse attention, apart from the legal liability.
But best results cannot be achieved if you take measures only to stall any likely negative impact; they will come only when initiatives are taken from a sense of commitment.
Mining utilises natural resources that are exhaustible. Once they are indeed exhausted, the mine will be closed. It is better to think in advance what will happen when that closure comes. Today there are mineral deposits which have conditions that allows reclamation along with extraction. Then there are big projects which will take up closure reclamation many years later, as you cannot extract today and reclaim tomorrow if your mine is one with vertical slopes. There, the closure has to be carefully planned, and the work done in phases, with money earlier earmarked for each phase. When such work is promoted to the public and approved and appreciated by the local community, that is the time for a company to claim it has been a responsible miner.
How much a miner contributes to local community development has become the most important criterion of responsible mining; should it be like this?
Let us go back in history, to the 1870s when hard rock gold mines were started in Australia. Parcels of land were given under license and the holders cared only for the money they could make. No one gave a thought to people’s lives or to the environmental damage caused. But things have changed with the passage of time, and today both are matters of significant concern. The Public Relations Division in a Mongolian mining company is seen as the most important unit in it, as it is responsible for presenting to the people all policies and actions of the company in the best light. All is good in this if done with transparency.
You are right that the prevalent trend is to lend support to whatever the local community wants, to be seen as a responsible company. This is wrong. A company should instead conduct a professional study of the social and economic conditions of the local community and take up a long-term development plan, instead of offering short-term and feel-good sops. If this is done honestly, the project will go ahead with little risk. It is essential that the company buys goods and services as much as possible from citizens of the local community.
The agreement on cooperation with the local community is seen as one of the good sides of responsible mining, but are the terms of the agreement usually observed?
The agreement is a legal document which is meant to be implemented and so it should be realistic from both sides and not be an expression of dreams.
Do we need to revise the State Policy on the Mineral Resources Sector until 2025 to better develop responsible mining?
The law allows the almost automatic grant of an extraction licence to the holder of an exploration licence when reserves are determined. The law also demands that all the current 1,680 licence holders submit their feasibility studies and environmental impact assessments. Once these are approved, they can launch their operation without delay. However, this is not always possible because of protests from the local community. Some find themselves unable to sell their products. In my view, if our priority is to export minerals, and we are not ready to start work on new deposits of strategic importance, then we must see to it that mines currently in operation are allowed to work without hindrance.