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Posts Tagged ‘pollution’

India court orders closure of Vedanta smelter

September 29, 2010 Comments off

“Vedanta, the London-listed company founded by billionaire Anil Agarwal, has suffered a fresh blow in India, where a court has ordered the immediate shutdown of its massive copper smelter in the south, citing violation of environmental laws in a sensitive coastal area.

Tuesday’s ruling by the Madras High Court came a month after India’s environment ministry rejected Vedanta’s plans to mine bauxite in the eastern state of Orissa, and during a sensitive time as New Delhi is considering whether to allow Vedanta to take a $9.6bn controlling stake in Cairn India, a rival which operates lucrative and strategically important oilfields in the northern state of Rajasthan.

The copper smelter in question is the Tuticorin plant in the state of Tamil Nadu, which has been operating for more than 12 years and which Vedanta has been planning to expand.”

Source: Financial Times, September 29, 2010

Observations:

  • The copper smelter was forced to close because of emitting noxious air pollution and high levels of heavy metals, arsenic, and fluorides in the waste, leaking into the groundwater.
  • In the last months, Vedanta has also been in conflict with the government because of alleged mining on tribal lands before permits were obtained and buying ore from illegal mines. These conflicts arise from a new ethics law for the mining industry passed on spring of this year.

Implications:

  • 12 Year old processing plant typically don’t suddenly become more polluting, although an operational mistake might have led to temporary high levels of emissions. It therefore appears to be a change of policy of the Indian government (& court) that the plant has been forced to shut down.
  • The vigor of the Indian implementation of the new standards has surprised many experts, including the Vedanta board. However, it is clear that the competitive advantage Vedanta enjoyed because of less environmental pressure in India is coming to an end.

©2010 | Wilfred Visser | thebusinessofmining.com

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Xstrata continues mine studies in Philippines

June 11, 2010 1 comment

“A unit of Xstrata said on Friday it will proceed with public discussions and technical studies on its $5.2 billion copper-gold project in southern Philippines despite a looming local ban on the venture.

State agency Mines and Geosciences Bureau (MGB) said it may question the ban with the courts as a last resort, adding the measure could hinder investment in the mining sector.

Manila has ambitious plans to develop the mining sector from a moribund state by attracting billions of dollars of foreign investment.

The Tampakan mine, considered Southeast Asia’s largest undeveloped copper-gold prospect, was opposed by local residents who feared the open pit mining method to be used by Xstrata’s Philippine affiliate Sagittarius Mines Inc would pollute a major river irrigating farms. Mine production is set to start in 2016.”

Source: Reuters, June 11 2010

Observations:

  • Feasibility studies indicated the Tampakan deposit could sustain an annual average copper production of 340,000 tonnes per annum and 350,000 ounces per annum of gold, based on a 20 year operation (source: Infomine.com)
  • Local government at Tampakan has banned open pit mining at the Tampakan deposit. Fears are that the large scale mining operation will pollute the local river on which water many farmers are dependent.

Implications:

  • Local government might be overruled by national government. However, Xstrata will need to prove to the locals that the open pit mining operation will not lead to pollution of the river in order to change public opinion.
  • Proving impact of mining on groundwater and river and influencing this impact is typically very difficult, as groundwater aquifers are very hard to map.
  • Underground mining, which is favoured by the local government, reduces the need for lowering the groundwater level, but pollution risk from processing and waste/tailings is the same as with open pit mining.

©2010 – thebusinessofmining.com