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Mining companies and indigenous peoples – mutually beneficial partnership

08 august 2022

The ninth of August is celebrated under the auspices of the United Nations as the International Day of the World's Indigenous Peoples. On our planet, there are more than 200 million people belonging to aboriginal peoples and ethnic groups. Today, they often inhabit ecologically vulnerable but resource-rich regions. That is why it is important to maintain a balance between the interests of indigenous peoples inhabiting their ancestral lands and industrial companies operating in these regions.

In Russia, about 50 ethnic groups are classified as indigenous peoples of the North. More than half of them live on the territory of the Arctic zone of Russia, including two thirds - outside urban settlements.

Since it is practically impossible to preserve the native habitat of the indigenous peoples of the North, the life of the indigenous population of the North, as well as that of other residents of Russia, should change taking into account new life circumstances, says Igor Sergeev, professor of the Department of Economics of the Northwestern Institute of Management of the Russian Presidential Academy of National Economy and Public Administration.

According to the scientist, an important condition for the sustainable development of the indigenous population of the North is its involvement in the management of economic activities that are carried out on the land inhabited by ethnic groups (with the exception of military zones).

INITIATOR OF THE FPIC

For the first time in the history of the Russian mining industry, Norilsk Nickel launched the so-called Free, Prior and Informed Consent (FPIC) procedure in 2021 and invited the indigenous residents of Taimyr to choose themselves how to resettle the village of Tukhard.

The FPIC procedure, successfully completed in 2022, has become an example of respect for the right of indigenous peoples to independently determine their political, social, economic and cultural priorities.

As Vladimir Zhukov, Vice President of Norilsk Nickel for Investor Relations and Sustainable Development said at the conference "Challenges 2030. Sustainable Development of Regions," interaction with small-numbered indigenous peoples is one of the important areas of the company's activities to ensure sustainable development.

In this regard, the the FPIC procedure was designed to become a guarantor of respect for the rights of the indigenous peoples of Taimyr.

"Norilsk Nickel has historically provided active support to indigenous communities, but now cooperation has reached a new level. Two years ago, we signed a five-year agreement worth 2 billion rubles, which was based on the results of a dialogue with communities taking into account their needs and requests," Zhukov said.

The initiatives earmaked in the FPIC roadmap include the construction of venison and fish processing workshops, purchasing of refrigeration units, construction of an ethnic complex with fur processing workshops, subsidizing helicopter transportation, targeted training in professions in demand at Norilsk Nickel, as well as the publication of textbooks in indigenous languages and many other special and comprehensive initiatives.

Although the FPIC procedure is not directly included in the legislation of the Russian Federation, Norilsk Nickel, which is the world's largest producer of palladium and high-quality nickel, as well as a major producer of platinum and copper, voluntarily recognizes international standards and the UN Declaration on the Rights of Indigenous Peoples.

ADVANCED APPROACHES

The approaches of Norilsk Nickel in the field of interaction with indigenous peoples are undoubtedly rated as advanced in Russia.

There are 19 ethnic groups living in the Arctic zone. The support of the indigenous peoples of the North is spelled out in the 10-year Development Strategy of Norilsk Nickel until 2030, which provides for the preservation of their traditional way of life, support for economic activity and culture, financing of measures to save the eco-environment, construction of social facilities and the preservation of ethnic languages, as well as the development of tourism.

Thus, Norilsk Nickel is today the only mining company in Russia whose development strategy separately prescribes to provide support to the indigenous peoples of the North.

In June 2022, Norilsk Nickel held preliminary consultations with the representatives of the indigenous peoples in the villages of Lovozero and Krasnoshchelye of the Murmansk Province in connection with the prospects for the development of the largest lithium deposit in Russia - Kolmozersky.

The dialogue was attended by the Sami, Nenets and Komi, as well as representatives of reindeer herding farms, authorities, Rosatom State Corporation and independent experts in the field of indigenous peoples' rights.

The main purpose of the meeting was to build a two-way dialogue between the company and indigenous peoples, to inform representatives of local communities about the upcoming project, to listen and record suggestions and comments of indigenous organizations.

"It is important for the company to take into account and minimize all possible negative consequences for the indigenous peoples of the region. Norilsk Nickel has extensive experience in supporting reindeer husbandry in Taimyr, and this knowledge and competence will be applicable in the Murmansk Province," commented Andrey Grachev, Vice President of Norilsk Nickel.

RUSSIAN EXPERIENCE

The reserves of minerals extracted on an industrial basis are mainly located in places of compact residence and economic activity of the indigenous peoples of the North.

For example, diamonds are mined in the Anabar, Bulun, Zhigansky and Mirninsky districts of Yakutia. A few years ago, diamonds were discovered in the Nyurbinsky district. Coal is mined in Southern Yakutia, gold - in Aldan and Oymyakon, tin - in Ust-Yan. Indigenous small-numbered peoples of the North live in all these places.

In Russia, the number of indigenous peoples of the North, Siberia and the Far East is about 50,000 people. One of the priority tasks of Russian mining enterprises is to preserve their numbers, traditions and territories of residence.

ALROSA, which develops diamond deposits in Yakutia, pays considerable attention to social responsibility. The company sets itself a large-scale task: to develop the regions of its presence so that local residents are always provided with jobs and decent wages.

ALROSA finances the organization of children's recreation in children's health camps, assistance to the poor, war and home front veterans, and the society of the blind.

In addition to charitable assistance, ALROSA promotes the employment of representatives of indigenous peoples, whose share among the company's employees is about 11.6%.

In turn, Almazy Anabara OJSC, within the framework of the cooperation agreement with the Anabar National Ulus, pays attention to the employment of indigenous population at the compnay's operations.

JSC Nizhne-Lenskoye, for its part, is engaged in the development of diamonds in the territories of four uluses – Anabar, Olenek, Zhigansky and Arctic Bulunsky, with which the company has signed agreements on socio-economic cooperation.

WORLD PRACTICE

Millions of dollars are donated to support the population of Southern Africa by the British mining group Anglo American and its subsidiary De Beers.

De Beers and National Geographic have created a strategic partnership aimed at protecting endangered species of Africa, ensuring water and food security for over a million people and creating livelihood opportunities for 10,000 aborigines.

The Australian mining company Rio Tinto, which owns enterprises in 36 countries, has developed its own standard for the relationships and social life of local residents.

At the Oyu Tolgoi gold and copper mine in Mongolia, Rio Tinto has taken over the protection of the tangible and intangible cultural heritage of the indigenous population.

Rio Tinto is also working to restore trust and relationships with the aborigines of Western Australia after the destruction of the ancient caves of their residence in the Juukan Gorge in the Pilbara region.

The Swiss company GLENCORE, one of the world's largest suppliers of raw materials, is also actively working with indigenous groups.

The company's activities are carried out in compliance with the recommendations of the International Council on Mining and Metals on indigenous Peoples and the mining industry, which requires that projects located on lands traditionally owned by indigenous peoples or in their usual use be implemented taking into account the rights and interests of ethnic groups.

In turn, the Australian BHP, one of the largest mining companies, in 2016 created a Global Indigenous Peoples Working Group, which includes representatives of all international assets of the company, including Minerals Australia and Minerals America.

The Working Group is engaged in the development, management and implementation of the company's strategy for indigenous peoples, as well as, among other things, supporting regional groups in the development and implementation of work plans with aborigines.

Lucara Diamond, which is expanding its Karowe diamond mine in Botswana, successfully works with 19 different local communities, holding regular meetings with representatives of each of them to better understand their specific needs. The company also collaborates with indigenous peoples in Alaska.

Natural diamond mining companies start working with local authorities even before the mine is opened. The drawn-up plans pursue not only the goals of preserving biodiversity and ensuring the safety of adjacent lands, but also preserving the culture and traditions of the indigenous population, improving its economic status and educational level, providing medical and social guarantees, as well as paying compensation.

For example, Debswana, a leading diamond producer in Botswana, runs primary schools in mining communities, and De Beers pays scholarships for girls and women studying in the field of exact sciences.

Industrial giant companies today are increasingly focused on trust between the local community and business, the "green economy", sustainable regional development, in particular, on strengthening the role of the local population in business development.

NOT WITHOUT PROBLEMS

Most of the assets of large industrial companies are located in the immediate vicinity of the indigenous peoples' residence. Thus, the active industrial development of natural resources in different parts of the world cannot but affect the lives of indigenous small-numbered peoples who live in these territories.

In the process of opening new mines, most mining companies have conflicts with indigenous people related to the need to relocate them. Despite initiatives to involve aborigines in business, they are quite zealous about changing the boundaries of the lands where they live.

As recently reported, the indigenous people of the Northern Territory of Australia demanded compensation from local authorities for the damage caused to their sacred trees by the zinc and lead mine McArthur River, which is owned by Glencore.

According to the Roving Reporters agency, in the countries of Southern Africa, aboriginal peoples are under increased pressure to force them to agree to the activities of mining enterprises, which are environmentally hazardous.

Alex Shishlo for Rough&Polished