Towards Responsible Gold Mining in Sagaing Region
On 9/10 March, MCRB hosted a multistakeholder discussion on licensing and responsible business practices for gold mining in Sagaing Region bringing together government officials from the Mining, Forestry and Environmental Conservation Departments of the Ministry of Natural Resources and Environmental Conservation (MONREC), General Administration Department (GAD), the Directorate of Investment and Companies Administration (DICA) and the Ministry of Agriculture, Livestock and Irrigation (MoALI), together with parliamentarians from across Sagaing Region, including Homalin, Tigyaing , Kawlin, Wuntho, Indaw, and Pinlebu townships. They were joined in Monywa by local and international mining companies, civil society organisations and international NGOs and experts.
The purpose of the workshop was to support the action point 5.5.3 in the Government of Myanmar’s 2018 Myanmar Sustainable Development plan to: ‘Reform the nature of the minerals sector such that it becomes both sustainable and profitable, while making both a positive contribution to government revenues and to the lives of our people’.
The workshop followed on from MCRB’s field research for the 2018 Sector-Wide Impact Assessment (SWIA) on Limestone, Gold and Tin Mining in Myanmar which had included research on small-scale and artisanal gold mining in Homalin, Kawlin and Banmauk.
The decision to hold the workshop was also prompted by the intention of the Sagaing regional government and parliament to adopt its own Mining Law, to complement the amended 2015 Union level law and 2018 Mines Rules. In accordance with the Law, a Sagaing Region committees, rather than the Union-level Ministry of Natural Resources and Environmental Conservation (MONREC), will issue most artisanal and small-scale mining (ASM) licenses, including for gold and collect license fees, land rent and royalties at the states/region level. (Artisanal mining is defined as gold mines of less than 1 acre and small-scale as less than 4 acres.
However there is no clarity in the Rules about how to address overlapping claims, and no minerals cadastre to help avoid overlap. ‘ASM zones’ have been proposed as a solution, but their potential to address these problems is unclear. This lack of legal clarity is already leading to problems in some states and regions, particularly Sagaing, where large-scale licences for prospecting/exploration have been issued on area which are the subject of interest for ASM miners.
The objectives of the workshop were therefore to provide all stakeholders with a basic understanding of:
Myanmar policy/legal framework for mining, including decentralization of licensing
The nature of large-scale, small-scale and artisanal mining including the mining project cycle (prospecting, exploration, construction, production, closure)
Responsible mining practices
Zoning of ASM, based on international experience
Discussions also covered the negative social and environmental impacts of the mining sector in Sagaing Region and how to address these, including drawing on international experience, and current licencing issues related to large-scale gold mining (LSM) and ASM, and how to resolve them, including the potential for ASM to co-exist and regulatory and other changes needed to facilitate this. Presentations by the Mining Department, Environmental Conservation Department (ECD) and Natural Resources Governance Institute (NRGI) addressed some of these issues, with NRGI highlighting Mongolia as a country with ASM from which Myanmar could learn.
Representatives from the International Investors for Mineral Development Association of Myanmar (IIMDA) which brings together international mining companies and service providers, presented on the nature of large-scale mining. The explained the project cycle in which mining companies over years and even decades carried out low impact exploration over a wide area before narrowing down targets to a small range, relinquishing exploration tenement as they went. The example was given of Sepon gold mine in Laos which started with 5,000 sq. km in 1993 before building a 28 sq. km mine 10 years later. The question of whether ASM and large scale exploration could co-exist was raised. Expert speakers emphasised the importance of amending the legal framework to clarify this, as well as the ongoing work to establish a minerals cadastre under MONREC (with support from the World Bank). The Zambian online cadastre was demonstrated.
Participants were polled on their perceptions of mining in Sagaing Region. Only 8% thought there was responsible gold mining in Sagaing, with 45% believing there was none, and 47% unsure. When asked which type of mining most benefits the people of Sagaing, 51% said artisanal, 24% said small and 20% said large-scale. The majority (52%) of participants viewed large-scale mining (LSM) as having the most negative impacts; 20% saying ASM was the most damaging (with small and medium-scale mining scoring 16% and 12% respectively). The biggest problem associated with gold mining in Sagaing was identified as pollution of water resources (38%), followed by deforestation (17%), damage to land and crops (14%) and land acquisition (10%). Since the primarily causes of water pollution and deforestation from mining are cause by ASM, this somewhat contradicted the view that large scale mining had the most negative impacts, but participants identified their two most significant mines at Letpadaung (copper) and Tagaungtaung (Nickel) as driving their opinion of LSM. Local job opportunities were identfied by over half of participants as the main positive impact they hoped for from mining, Concerning problems faced by mining companies, permitting delays came first (30%) followed by corruption (21%).
The second day focussed on artisanal mining and how to reduce its negative impacts, including the use of mercury which has significant environmental and health impacts, particularly with current practices. PACT, National University of Singapore, and Spectrum all presented their previous research and future plans. Graham Prescott of NUS explained their research conducted at the request of the Sagaing Chief Minister to examine whether enforcement or alternative livelihoods approaches could disincentivize informal mining, which concluded that neither would be effective. PACT has studied artisanal mining practices in Homalin and plans follow up to include a holistic community development village approach with a focus on health, mercury reduction and mercury alternatives in artisanal mining, based on their global experience.
Overall, in addition to highlighting the major environmental issues caused by ASM, discussions at the workshop and points raisied by officials and companies demonstrated significant overlap, inconsistency,instability and lack of enforcement concerning the legal framework as it concerns mining, land use (including so-called virgin, fallow and vacant (VFV) land), environmental impact assessment, environmental conservation particualrly of water resources, and control of hazardous chemicals such as mercry and cyanide. This raises significant questions about whether and how mining legislation at State/Region level should be taken forward before these problems with the legal framework are resolved. The problems faced by small mining companies in navigating the confusing legal framework and associated red tape were also raised.