Mining companies work to protect communities from COVID-19

May 20, 2020

When Norway’s $1 trillion wealth fund announced that it would blacklist some of the world’s largest mining companies over their greenhouse gas emissions it reaffirmed the findings from Ernst and Young that the loss of a social license to operate is the greatest risk to the mining industry over the last two years.

Already, some investors have been cautious about the mining sector because of climate change and now, with the COVID-19 pandemic, there is more scrutiny of how mining companies will respond especially in remote communities.

Reuters reported that many of the leading firms have responded by taking extra measures to not only protect their workers, but also the surrounding communities. Firms have changed rosters to stop outsiders infecting remote communities, paid staff with potential health issues to stay at home and given food to indigenous families so they don’t have to shop in nearby mining towns.

For example, South32 said it had strictly separated fly-in, fly-out staff at its manganese mine GEMCO in north Australia from residential workers who are interwoven with the local Anindilyakwa people on Groote Eylandt - and expects to keep the measures in place for months.

“We work in close proximity to several indigenous communities who have vulnerable people. It’s absolutely essential we get it right,” said Jo-Anne Scarini, vice president of operations at the mine.

Australia, which is among the countries most successful in fighting the spread of COVID-19, had just more than 7,000 cases as of May 18 and 99 deaths. It does not separate out data for cases among Indigenous people, who make up 3.3 percent of the population.

BHP has put in place measures to protect higher-risk employees such as Aboriginal and Torres Strait Islanders - and asked all its contractors to do the same.

Rio Tinto has adopted a similar policy and is also administering antibody blood tests and temperature checks before staff fly to remote sites to reduce the risk of anyone infecting the mainly indigenous communities near mines.

In the Arctic Canadian territory of Nunavut, a predominately indigenous region mostly made up of Inuit, miners slowed their operations to limit the risk of an outbreak.

In Peru, MMG Ltd has given food and care packages to 6,000 families in the Apurimac region around its vast Las Bambas copper mine in the Andes to discourage them from going to town for provisions and potentially exposing the community.

Environmental, social and governance (ESG) investment analysts say they are watching mining companies closely to see how they cope with the coronavirus crisis, mindful of the potential risks to their reputations.

“An outbreak would attract further scrutiny over miners’ COVID response from local authorities and civil society,” said Ziggy You, ESG investment analyst at Aberdeen Standard Investments, which holds shares in mining companies.

“In case of a major outbreak, we would carry out an assessment of both its financial and social impacts and factor that into our investment decisions,” he said.

Paul Mitchell, global mining & metals leader at EY, said the safety culture instilled in mining companies had helped stop the coronavirus from spreading.

“It is true that the ‘brand’ of mining has suffered in recent years,” he said. “When we talk about safety these days we talk about zero harm so it does go beyond ‘accidents’ to thinking about health and wellbeing.”

Photo: Rapid COVID-19 screening process at Perth Airport, courtesy Rio Tinto

 

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