BHP Billiton
The BHP Billiton corporation, which was born with recent merger of Australian mining giant BHP and the London-headquartered South African Billiton resources company, made a monster profit of US$2.189 billion in the last financial year.
Of this, US$148 million came from the Ok Tedi mine in Papua New Guinea (down on last year). While the wealthy executives are celebrating their returns, little is being said about the local villagers who live near this mine.
The Ok Tedi mine has been the site of landslides, severe flooding, forest degradation and the dumping of toxic substances. All of which have been the result of BHP's unsafe, profit-driven mining practices.
In a 1999 report, consultants for BHP revealed that the environmental impact of the mine was far worse than previously thought. The report stated that millions of tonnes of silt, sand, chemicals and other mine waste had been poured into the Ok Tedi and Fly rivers over the past decade, causing frequent flooding that will kill existing trees on 800 sq kms of flood plain by 2010.
There are also concerns about the toxicity levels at both the bottom and top ends of the food chain. It is feared that algae in the Ok Tedi River has been permanently harmed, and that indigenous fauna may also be vulnerable to the presence of heavy metals in the ecosystem.
The 30,000 villagers who live along the Ok Tedi and Fly rivers did not need BHP to file a report to tell them of the environmental impact of the mine. In 1996, they successfully took BHP to court. The corporate giant was forced to pay approximately A$10 million, followed by yearly payments of A$4 million to the villagers. This worked out to about A$133 per person per year.
The payments did not go directly to the local villagers but to the Fly River provincial government.
In the end, the logic of compensation was exposed. It would cost BHP between A$300 million and A$2 billion to construct a new tailings dam to reduce pollution levels, but it would only cost it $10 million in payouts to keep everyone quiet.
However, continuing bad publicity, mounting public pressure and decreasing returns have resulted in BHP reconsidering its options for the Ok Tedi mine. In November, the mining giant proposed closing Ok Tedi early, but the PNG government was concerned this would reduce its income from the mine.
"From BHP's perspective as a shareholder, the easy conclusion to reach ... is that the mine is not compatible with our environmental values and the company should never have become involved", said the company's chief executive officer Paul Anderson.
The Australian-based multinational has made no commitment to look after the PNG people or the environment after it leaves. If BHP is genuinely concerned with preserving the environment it would clean up the mess it created. Even after the mine closes, ecological damage will continue.
"The best environmental outcome has the highest social cost and the best social outcome has the worst environmental outcome. The final decision will be with the PNG government", claimed Anderson, in another clear attempt by the company to distance itself from its responsibility.
For BHP to threaten to walk away from the mine is completely irresponsible.
About two years ago, BHP ran an advertising campaign in British Columbia in Canada boasting of its environmental record in the Island Copper mine closure. BHP's ad showed a sparkling blue lake and a bright sunny sky, along with the slogan: "Leaving the environment the same way we found it." BHP should live up to its corporate propaganda and clean up the Ok Tedi and Fly rivers.
While BHP celebrates its record profits, locals living on the Ok Tedi and Fly rivers, along with other PNG grassroots organisations, have continued the campaign against BHP's environmental vandalism.
In Australia, activists will be highlighting BHP's pollution record during the three-day blockade of the Commonwealth Business Forum (CBF) in Melbourne on October 3-5. The CBF aims to "actively promote the views and insights of the private sector of the Commonwealth". BHP Billiton's Ron McNeilly, the executive director of global markets, will be speaking at the forum.
By Vivian Messimeris