Tharisa Minerals: Masters at ducking and diving
The Tharisa Mine is an opencast mine producing chrome and platinum group metals concentrate. The mining method at Tharisa comprises a standard open pit truck and shovel method. A mining contractor, ANDRU Mining, is employed to conduct the mining activities. The mine is located some 35 km east of Rustenburg and 95 km from Johannesburg; within the Rustenburg Local Municipality, Madibeng Local Municipality and Bojanala Platinum District Municipality in the North West Province of South Africa.?The mine is located on portions of Farm 342JQ (Kafferskraal) and Farm 297JQ (Rooikoppies) and comprises two sections namely the East Mine and the West Mine, which are separated by the Sterkstroom River and the Marikana road (D1325).?
Thari Resources (Pty) Ltd, incorporated in January 2005, acquired prospecting rights for chrome and platinum group metals over various portions of the property Farm Kafferskraal 342JQ and the property Rooikoppies 297JQ in March 2006. ?At that time, Thari established Tharisa Minerals as a wholly owned subsidiary. ?Tharisa Plc was incorporated in February 2008 and acquired 74% of Tharisa Minerals on 09 February 2009. ?The remaining 26% was held by Thari (20%) and the Tharisa Community Trust (6%).?On 14 February 2022, Tharisa Minerals announced that they were in talks to buy out Thari and the Tharisa Community Trust, a transaction which will see Thari and the trust become shareholders in Tharisa plc, instead of the subsidiary which owns Tharisa Mine.?On 23 May 2022, the transaction related to the community trust was concluded, with 3,208,556 new ordinary shares in Tharisa Plc issued in exchange of the ZAR90 million (US$5.9) for the 6% of the trust’s ownership in Tharisa Minerals.?Whether the community (as the trust's beneficiaries) were consulted about this transaction is unclear at this stage.?It is doubtful.?Tharisa is not known for consultation with affected persons.?This recent Labour Court judgment against the mining company is just one example:?https://www.saflii.org/za/cases/ZALCJHB/2022/169.pdf. Tharisa plc was listed on the Johannesburg Stock Exchange and commenced trading on 10 April 2014.
Two environmental impact assessments (EIAs) have been approved for the Tharisa Mine.?The first one was in 2008, and the second one in 2014.?The Tharisa Mine started trial mining in October 2008 and commenced production of ore on a small scale from March 2009, and from 2010 to 2012 the mine undertook a number of process facility expansions to increase processing. ?The first EIA would have guided these activities.?The second EIA was approved in 2014, with applications to make amendments to the Environmental Management Programme (EMPr) following in 2019 and a subsequent application currently underway.? A third EIA is also currently underway.
In order to expand its operations in line with South African legislation, the approved EIA and EMPr, and international best practice, Tharisa Minerals needs to relocate not only the communities of Lapologang and Maditlokwa, but also (white) commercial farmers plus their workers and their tenants (both white and black). ?In its official documentation, e.g. its annual reports, the company claims that it adheres to the Equator Principles (see pages 35 and 71 in its integrated annual report for 2021, available here: https://www.tharisa.com/pdf/investors/annual-reports/2021/annual-report-2021.pdf).?Why the company would make this claim is unclear, because normally only financial institutions would make such a claim.?It is possible that the company at some stage obtained a loan from a financial institution that adopted the Equator Principles and was then obligated to adhere to these standards.?It was however not possible to ascertain whether it is the case.?Despite publicly declaring that it adheres to the Equator Principles, the company has steadfastly maintained they do not need to comply with the Equator Principles when it comes to involuntary resettlement issues.?This despite the Equator Principles being IFC standards by default because under Equator Principle 3 - Applicable Environmental and Social Standards - all eight IFC Performance Standards apply.?
When one deals with Tharisa Minerals one often gets the impression that the company’s executives do not know anything when it comes to ESG, and that they generally just stumble around in the dark hoping not to have the light shone on their ignorance and incompetence.?
In its maiden Social and Labour Plan (SLP) 2008-2013 Tharisa Mine mentions resettlement of approximately 544 households, and the lack of available housing for resettlement in Rustenburg Local Municipality (please see pg. 56 of the SLP – available here: https://www.tharisa.com/social-and-labour-plan.php ).?One assumes these households lived in the original Maditlokwa community plus farmworkers living on various farms. ?The SLP recorded as “mitigation” when it came to the resettlement of these households: “Cognizance of prevailing legislation and best practice in respect of relocation planning and implementation should be considered critical at all times. Critical to all relocation planning exercises is the appropriate and regular communication with those affected by the relocation process and should include legal presentation for the affected households”.?Despite this, the original Maditlokwa community households were unceremoniously relocated to a piece of land near the mine in 2011/2012 and provided with tin shacks for houses.?Many households lived in large brick houses previously and are now living in extremely poor quality of life in tin shacks provided by the company as its resettlement replacement housing.
One must assume that the “large informal settlement” referred to on pg. 57 of the 2008-2013 SLP is reference to Lapologang, which is in reality a formalized township where the original inhabitants all have title deeds to their properties.?It would appear as if Tharisa was unaware that Lapologang was a formal township until March 2022 when this issue was raised with the company.?Tharisa Mine appears to completely disregard Lapologang when it comes to any community investment or even recognition when it comes to its obligations when it comes to host communities.?Lapologang is not once mentioned in the publicly available SLP documents, i.e. the 2008-2013 and the 2019-2023.?The second SLP (2014-2018) is not available on the company’s website.?
Tharisa Minerals was supposed to resettle the communities of Lapologang and Maditlokwa, plus the commercial farmers plus their workers and their tenants already in 2014 (if one adheres to the mitigative measures listed in the approved 2014 EIA and EMPr), but have not done so, and the communities’ current living conditions are particularly poor and filled with environmental, physical and emotional violence.?The reality of life on the ground was captured by this TV programme aired in early April 2022: https://www.enca.com/shows/checkpoint-tharisa-terror-8-april-2022. What is unusual, in the South African context, is that Tharisa Minerals treats its affected communities, whether affluent, poor, previously privileged or previously disadvantaged, all equally poorly, avoiding adherence to any best practice or even the most basic standards.?The company has consistently refused to purchase the commercial farms at replacement value and has tried to pass its obligation to provide adequate housing with security of tenure on to the Rustenburg Local Municipality and the South African government. ?Anglo American Kumba Iron Ore is also trying to pull this nonsense in its forever ongoing Dingleton resettlement. ?Both these companies appear to confuse involuntary resettlement with eviction.?In South African law, the local government is obligated to provide housing for evicted persons with no other housing option, but this is not eviction.?This is involuntary resettlement which will allow the company to mine and make profits from that activity.?To expect taxpayers to foot the bill is just disingenuous, not to mention the thousands of families who have been on state-funded housing (locally referred to as RDP housing) lists for decades with very little progress being made.?Somehow these companies expect those households to stand back so that mining-induced involuntary resettled households be first in line.?It’s ludicrous.?The Auditor General has expressed concerns over both these municipalities as going concerns, with Gamagara Local Municipality (where Anglo American Kumba hopes government will build houses for Dingleton resettled persons) in its fifth year with going concern problems, and Rustenburg Local Municipality in its third year – see Auditor General’s report: https://www.agsa.co.za/Portals/0/Reports/MFMA/2020-21/FINAL_MFMA%202020-21%20GR_15%20June_2022%20tabling.pdf?ver=2022-06-15-095648-557
Despite this dire financial situation, the Rustenburg Local Municipality has approached the Development Bank of South Africa (DBSA) for funding for the “Maditlhokwa Feasibility Study and Township Establishment”: https://www.dbsa.org/sites/default/files/media/documents/2021-05/RFP0942021%20MADITLHOKWA%20TE%20RUSTENBURGI%20LM2.pdf. Although the call for proposal was published in May 2021, it does not appear as if any company has been appointed to date, and enquiring emails to the DBSA have remained unanswered.?
As a Tharisa plc shareholder, I asked for more information on the resettlement plans at the company’s AGM in February 2022.?I was told by the chairman to refer my question to Mr Ilja Graulich, which I duly did, but to date have received no response.?
In April 2022, a group of Lapologang property owners requested that I attend a meeting with Tharisa’s Thabang Maluke, to represent them.?Mr Maluke refused to meet us at the company and requested a venue off-site.?He arrived with uninvited persons who then caused havoc and the meeting could not continue.?The Lapologang property owners then asked me to put their concerns in writing and send it to Mr Maluke and other Tharisa executives, Messrs Alston Smith and Charles Kantor.?The letter was dated 30 April 2022, and contained, amongst other paragraphs, the following:
“These owners requested a meeting with you on 25 April 2022 for 26 April 2022.?It should be noted that the first phone call to you to arrange for a meeting was already on 21 April 2022, but you only responded on 25 April 2022, agreeing for a meeting on the 26 April 2022.?You refused to meet at the Tharisa Mine offices, and opted instead for a public venue, which resulted in other, non-invited parties disrupting the meeting.?How these persons knew about the meeting, remains a mystery as we did not provide the information to them as the meeting was called by individuals and not the community.?The discussion was supposed to be related to how the resettlement will affect the above-mentioned landowners and the interim arrangements between now and the day of resettlement.?
Your refusal to meet at Tharisa offices is not only unprofessional, but also encourages chaos.?
It would be helpful for you to adhere to the requirements of the IFC Performance Standards as Tharisa is obligated to do, as well as the DMRE 2022 Mine Community Resettlement Guidelines, which state that Tharisa “must consult meaningfully with landowners” (Section 5.1.(a)) and that the consultation shall be in terms of Sections 10(1)(b), 16(4)(b), 27(5)(b) of the Minerals and Petroleum Resources Development Act (Act 28 of 2002).?You are also reminded that only speaking to “leaders” (whether elected or not) within a community is not best practice, nor is insisting that such “leaders” (whether elected or not) be present at consultation meetings with landowners.
We had hoped to discuss the following agenda items at the meeting:
a)????Update on the relocation/resettlement
b)????What options on the table for landowners?
c)????The ongoing health impact on the community due to the dust, noise, toxic fumes, vibrations, etc., specifically the traumatising of the children due to the blasting
d)????The ongoing damage to the houses due to the Tharisa mine’s blasting and the diminishing cell phone signal due to the increasing height of the mine dump right on Lapologang’s doorstep
e)????What local economic development projects do Tharisa Minerals plan to launch in Lapologang between now and the resettlement?
f)??????The proposed dam to be built behind the school
?In conclusion Mr Maluke, please provide the following requested information in writing by no later than 10 May 2022:
(i)??????????Does Tharisa Minerals consider Lapologang as an affected community that will need to be resettled in terms of the conditions of the 2014 DMRE-approved EIA?
(ii)????????Please provide the draft Resettlement Plan
(iii)???????Please provide the draft Livelihood Restoration Framework
(iv)???????Please provide a description of the Grievance Mechanism
(v)????????Please advise as to when the cut-off date (moratorium on building and new residents) was declared.?
(vi)???????Please provide alternative options for areas to be relocated to, since they are not interested in those areas listed in the Green Gold BID document.?
(vii)?????Please provide the mitigation plan which lists the mitigation measures that Tharisa Mine will follow to improve the living conditions in Lapologang between now and until the day the relocation is successfully completed.
(viii)????The landowners listed above would like to have their blast-damaged property repaired, replaced or to receive adequate compensation for the damage suffered in line with the 2014 DMRE-approved EIA and international best practices.
(ix)???????Please provide information as to which local economic development projects do Tharisa Minerals plan to launch in Lapologang between now and the successful completion of the resettlement??
(x)?????????Please provide information about the dam which Tharisa intends to build right behind the school.”?
Naturally no response was received.?
On 31 March 2022, Mr Alex Khumalo, Head of Social Performance at Minerals Council South Africa, announced at the Mineral Council’s webinar on “Social Performance and Community Engagement for Junior and Emerging Mining Companies”, that communities have the right to complain both to the regulator, the Department of Mineral Resources and Energy (DMRE) and to the Mineral’s Council should they feel that a specific company’s social performance and community engagement does not comply with standards.?Tharisa Minerals is a member of the Minerals Council, so I let those affected by the company’s conduct know that they may also send complaints to the Minerals Council.?The commercial farmers sent their complaint first, with the Lapologang owners asking me a day or so later to also send their complaint.?For some time there was no response from Mr Khumalo, but on the eve of the Mining Indaba he informed the commercial farmers that they should direct their complaint also through me.?I immediately approached Mr Khumalo again for a response to our (now combined) complaints about Tharisa Minerals.?Mr Khumalo then met with me in Cape Town, promised to act, but now months later…. dololo… no feedback from Mr Khumalo despite requests for feedback, Nothing has been done by the Minerals Council, which begs the question: what’s the purpose of the Minerals Council beyond being a lip service organization without any willingness to censure its members?
At the end of March 2022, the Department of Mining Resources and Energy (DMRE) published resettlement guidelines for mine community resettlement, and at the Keyter Rech Investor Solutions’ “Unlock the Stock” session on 30 June 2022 (video available here: https://www.youtube.com/watch?v=cKjrWdv3gjE), Tharisa’s CEO, Mr Phoevos Pouroulis, indicated that the company has a ‘comprehensive relocation programme’ to deal with the resettlement.?I asked the following question: “Please provide more information related to the ‘comprehensive relocation programme’.?As a shareholder I have asked this question at the company’s AGM in February, I was advised to request the information from the company, which I did on several occasions, but I have received zero response.?This is a poor reflection of the company’s ESG.”?I was informed by Keyter Rech Investor Solutions that there would not be enough time for Tharisa to respond to the question during the webinar, but that it would be answered via email.?Despite sending an email and a subsequent reminder email to Mr Ilja Graulich, the question remains unanswered to date.?
On 17 May 2022, I received a text message from Tharisa’s Head of ESG, Mr Tebogo Matsimela, requesting a meeting.?The meeting was scheduled for 23 May 2022 and was also attended by Ms Pebetse Mabaso, SLP Manager. The meeting was to discuss the letter sent to Mr Thabang Maluke weeks before. I said that the company would have to respond to the letter in writing for the Lapologang Owners’ records.?On 25 May 2022 I received a text message from Mr Matsimela indicating that a response to the letter will be sent “shortly”.?
Naturally nothing was forthcoming, that is until 21 June 2022 when a letter from Mr Alston Smith was emailed to me by Mr Matsimela saying that they will not respond to the letter to Mr Maluke, because “We must point out that the Department of Mineral Resources and Energy (DMRE) has noted the various complaints forwarded to their office and in response thereto, a letter was sent to Tharisa Minerals to convene a meeting and to invite members of the surrounding communities as per DMRE instructions, which took place 20th May 2022.
Amongst the key resolutions that were taken, are the recognition of formalised structures that will regulate communications and engagements by Tharisa Minerals. This will ensure that Tharisa Minerals engages only with recognised structures. Furthermore, another key resolution taken at the meeting was the establishment of an Adhoc Committee under the leadership of the DMRE. The sole mandate of this committee is and will be to resolve issues raised by interested and affected parties- this committee will consist of formalised structures, DMRE, and other relevant government institutions such as the local municipality and Tharisa Mine management.
In light of the above, any structure that presents itself as representing a stakeholder/s should present its eligibility to the Adhoc committee as a formal structure and to the extent approved, will be endorsed and allowed to nominate a representative to serve on the Adhoc Committee, if and when approved by the DMRE.”?
Needless to say, no such committee has been established to date. The only “recognized structure” one can find is that led by the Rustenburg Local Municipality ward councillor, Mr John Salang.?I then sent the letter of 30 April 2022 to Mr Salang requesting that the requested information be forwarded and in the light of the letter from Mr Alston Smith, to urgently provide the Tharisa Mine’s grievance mechanism – something which I knew by then did not exist.?Mr Salang responded on 29 June 2022 with the following: “My plea to you and the others would be that of: To be given a space to deal with all issues that you are raising, myself and the community committee are in an engagement with the mine and my constituency regarding this matter.”
To date there has been no answer to the questions raised in the 30 April 2022 letter, nor to my numerous requests as a Tharisa Plc shareholder for more information related to the resettlement.?There is also to date been no real consultation with affected communities related to the resettlement.
The Lapologang Owners’ contract work with the mine was also unceremoniously ended during this period.?A request for information related to this action by the mine’s subcontractor, ANDRU Mining, resulted in ANDRU Mining saying that the instruction came from Mr Alston Smith.?An email to Mr Smith requesting clarity remained unanswered.
On the more positive side, on a recent visit to Lapologang on 03 August 2022, I saw that a notice board with a grievance box has been erected with some information on the mine’s grievance mechanism.?The mine started operating in 2008, and the grievance mechanism only developed in recent weeks. I guess that’s progress.?Perhaps there is hope that Tharisa will produce a draft resettlement action plan and start in-depth consultation processes using properly qualified persons and not leave it up to the local politician to achieve.