The article was originally published in the Rising Africa magazine, in Fall 2012.
Coins, cell phones, cars and
air- crafts and thousands other everyday items contain nickel and cobalt. Where
do those materials come from and what does it take to get those materials out
of ground? CCAfrica talked to Toronto-based Canadian company Sherritt
International Corp. to find out.
Sherritt International Corp. has initiated and operates a massive nickel
and cobalt mining enterprise in Ambatovy, Madagascar in collaboration with
SNC-Lavalin, and Japanese and Korean investors. At a construction cost of approximately
half of the GDP of Madagascar (measured in current US dollars), the 5.5 billion
dollar project employing over 6,000 people at various stages of project is
naturally the largest-ever foreign investment in the country. It is one of the
biggest investments in sub-Saharan Africa and the Indian Ocean region, too.
Not only is the project very expensive but as the map on the next page
shows, it is also located in multiple places in eastern Madagascar. Considering
the massive volume of the project, both its value in dollars and the area it
occupies, it is natural that project will have an impact on the surrounding
land and its people. Designed to operate for at least 29 years, Ambatovy’s goal
is to create lasting prosperity for all stakeholders and contribute
significantly to sustainable development in Madagascar.
To contribute to local communities long term, for example, choice to
refine nickel and cobalt in Madagascar was made, a rare decision in Sub-Saharan
Africa. This way, the value added to economy is ensured, as the project will
generate additional 1,000 high quality, well-remunerated jobs. Nickel will
become Madagascar’s first export item, which in return will generate foreign
ex- change for the country. Over its lifecycle, Ambatovy will contribute
hundreds of millions of dollars to the Government of Madagascar in taxes,
royalties, duties, and other payments.
To construct the Tailings Management Facility and the Plant site,
Ambatovy worked for many years in collaboration with local stakeholders:
government, civil society, media, local communities, and workforce and
contractors to gain their trust, inputs and acceptance. While resettling people
affected by project to appropriate, yet nearby, parcels of land, Ambatovy
ensured that relocation was fair, transparent, and participatory, respecting
local cultures and traditions according to Malagasy laws and international
social performance standards, namely, IFC PS5.
To ensure its goal – lasting prosperity and sustainable development -
Sherritt has employed a large corporate social responsibility unit employing
120 people to work together with the local people and helping to preserve the
natural environment surrounding the construction and mining sites.
“In consultation with our archeology team, for
example, it was discovered that a cellular tower at the Mine site was planned
on a sacred hill. We removed the tower and facilitated a traditional ceremony
to bless the site.”
Consisting of four divisions, Ambatovy’s CSR department deals with
community relations, programs, projects, and support services. Sherritt makes
every reasonable effort to ensure that the total impact on local communities is
positive. Ambatovy’s communication manager Lalaina Randrianarivelo told Rising
Africa: “Respecting human rights is a daily task that is undertaken by all our
employees. In consultation with our archeology team, we made several important
operation decisions in order to respect the traditional beliefs and culture of
com- munities around our sites. For example, it was discovered that a cellular
tower at the Mine site was planned on a sacred hill. As a result, we removed
the tower and facilitated a traditional ceremony to bless the site.”
In the words of local people, Sherritt takes the corporate social
responsibility seriously.
“Ambatovy has indeed shown some strong commitments towards transparency
by complying with Extractive Industry Transparency Initiative principles, which
encourages mining and gas companies that are investing in Madagascar, the
Malagasy government and other government-linked entities to disclose
various in- formation; namely payments made by the extractive industries to the
government,” says Mbola Andrianady, a Madagascar- native master student in
international development who specializes in CSR in the mining industry.
Ambatovy is obliged to adhere to national and international standards.
Ambatovy’s performance is monitored by Madagascar’s National Environment Office
under the Investment and Environment Compatibility Act to ensure its compliance
with environmental regulations set for in- vestments. With the support and
assistance of the World Bank, Madagascar accepted a Large Mining Investment
Law, under which Ambatovy project was certified in 2007.
Further, some of Ambatovy’s financing institutions are members of Equator
Principles Financial Institutions, which pledge to take into account social and
environmental criteria in the large-scale projects they finance. Equator
Principles advise the institutions not to finance loans where the borrowers are
not willing or able to comply with these criteria. As a result, Ambatovy’s
financing agreements require that the Ambatovy nickel and cobalt mine uphold
these principles.
With a view to achieving superior safety, environmental and social
results, Ambatovy is also committed to the following voluntary measures that go
beyond its legal obligations: Business and Biodiversity Offsets Program,
International Council on Mining and Metals Principles, International Standard
ISO 9001, and the EITI, as mentioned above.
Ambatovy aligns its reporting procedures with those of the Global Re-
porting Initiative framework, one of the world’s most prevalent standards for
sustainability reporting. Ambatovy also publishes sustainability reports, which
provide an overview of how Sherritt manages different sustainability issues in
this mining site. These publicly available reports discuss why health and
safety, training, biodiversity and reclamation, stakeholder engagement, and
community investment are important to the business.
Further, Ambatovy provided training to its security personnel on human
rights related to security practice. Respecting the human rights of the
employees through sound policies on collective bar- gaining and non-discrimination,
in 2011 progress was made on the collective bar- gaining agreement. While not
all aspects were finalized, parties were able to complete and sign 6 of the 15
sections. Additionally, Ambatovy also makes sure its employees and local
communities are aware of Ambatovy’s zero tolerance policy on child sexual
exploitation. Ambatovy continued to educate both local communities and our own
employees in this matter.
Ambatovy project clearly states its values publicly. When CCAfrica asks
whether this is a unique approach in mining industry, Ms. Randrianarivelo
responds: “This approach is often shared by companies with a responsible
approach. The only difference in Ambatovy is that we take the culture of the
host country also into consideration. In Madagascar, for example, the spirit
called “Fihavanana” which translates a set of solidarity, tolerance and
brotherhood is very active in the community. Ambatovy considers himself a
full-fledged member of the community that hosts them.”
As part of its social investments and partnerships Ambatovy’s Local
Business Initiative makes sure that people have a capacity to provide goods or
services to the project. Training and audits have been implemented so that the
quality can meet the requirements of the mining project. In 2010, 500 companies
and corporations have benefited from contracts and markets with Ambatovy.
Central agency for agricultural produce (the Central d’Achat de Madagascar)
is a Malagasy-run agency that serves the Toamasina area to provide a central
point for farmers to sell their agricultural produce outside their villages and
to help supply the Ambatovy project food requirements. The agency has been
successful, prompting the establishment of a second center in Moramanga, near
the mine site.
The Ambatovy has also set up agricultural training center in the
Toamasina area not far from the Ambatovy refinery site. This training center is
focused on pro- viding skills to workers who are completing their contracts but
it is also available to others from communities that have been affected by the
project. Note that nearly 18,500 employees worked for the construction of
Ambatovy and at the end, Ambatovy assisted its employees and its subcontractors
to move to new generating potential opportunities. This program is not only completely
new in Madagascar, but also unique in a sense that no other private company has
implemented such a program before.
As the species-rich location sets additional constraints on operation,
Ambatovy adheres to stringent environmental standards. Considering that local
people are dependent on natural resources for their livelihood, Sherritt has
initiated many conservation programs, which aim to en- sure no net loss, and
preferably a net gain, of biodiversity while ensuring socioeconomic benefits
for local populations.
Ambatovy’s social investments include sponsorships, charitable
donations, educational and health programs, vocational training and
professional development, and a wide variety of other sustain- able development
projects. Ambatovy built 296 new houses, a health center, schools and water
facilities and sanitation projects for the people impacted by the project. Villagers
were able to select their preferred housing model and each household received a
parcel of land for agriculture and grazing. Social development program aims the
autonomy of those villages. The objective is to ensure a better quality of life
than before.
On the surprising side, the
construction work opened the door to archaeological discoveries. Investigations
led to the collection of 4,851 objects such as pottery, ceramics, tumblers,
stones, metals, bones, plastics and botanies, writes Africa Review. It adds
that archaeological discoveries are expected to promote Malagasy culture and
scientific knowledge.
