The Tsumeb smelter belongs to Dundee Precious Metals (DPM), a Canadian company that operates and develops gold, copper and silver mines in Bulgaria, Armenia and Serbia. The European Bank for Reconstruction and Development (EBRD) provided the company with a EUR 20 million loan in 2005 and a USD 45 million revolving credit later in 2012 in order to, among other things, increase the ore recovery at the DPM-owned Chelopech mine in Bulgaria. With its higher yield, the Chelopech mine has for years kept the Tsumeb smelter going economically – half of the copper concentrate smelted in Tsumeb comes from Chelopech.The case of the Tsumeb smelter in Namibia demonstrates how European pollution is being exported to the Global South with the indirect help of public development money.
While people associate Namibia with African wildlife, the gateway to its largest sanctuary, the Etosha national park in the north-west of the country, has little to keep tourists there. The polluted air in the town of Tsumeb, home to exhausted open pit mines and a copper smelter, is something the 16,000 or so inhabitants have to live with and foreigners try to escape from.
Yet it is not only the heavy air that has been of concern. A local waste disposal site, as Bankwatch discovered on a monitoring mission earlier this year, is piling up with arsenic produced by the smelting of European ore and has caused fears of contaminated soil and water. Questions, too, are being raised about an intricate scheme whereby European pollution is exported to the Global South with the indirect help of public development money.
The Tsumeb smelter is an old troublemaker, created to process some of the dirtiest copper ore in the world. For years the air around the smelter has been filled with fugitive emissions – from arsenic dust to sulphuric dioxide.
Local people claim that some of their garden plants and crops suffer from this pollution. And it’s not only plants which are affected. A health report tested the urine of a few hundred locals. The arsenic concentration in the samples was high, even for people living 60 kilometres away from the smelter.
The Tsumeb smelter belongs to Dundee Precious Metals (DPM), a Canadian company that operates and develops gold, copper and silver mines in Bulgaria, Armenia and Serbia. The European Bank for Reconstruction and Development (EBRD) provided the company with a EUR 20 million loan in 2005 and a USD 45 million revolving credit later in 2012 in order to, among other things, increase the ore recovery at the DPM-owned Chelopech mine in Bulgaria. With its higher yield, the Chelopech mine has for years kept the Tsumeb smelter going economically – half of the copper concentrate smelted in Tsumeb comes from Chelopech.
The Tsumeb smelter has the reputation of being among the few in the world capable of processing ore which is abundant in arsenic, a toxic compound dangerous to human health if not managed properly. It was a practical choice for DPM to ship ore from Chelopech to Africa where environmental standards are more lax and refurbishment costs are lower. Back in 1988, the Bulgarian government had banned local facilities from processing the Chelopech ore because they were not able to handle the high arsenic concentration without environmental consequences. The alternative of cyanide leaching was rejected by Bulgarian society.
DPM acquired the Tsumeb smelter in 2010 with a special clause that exempts the company from any liabilities related to the environmental damage caused by previous owners. Adding to the dark legacy, the smelter has treated concentrates that contain twice as much arsenic as the ones processed in the past and the capacity of the smelter has more than doubled after technological upgrades, including the construction of new oxygen and acid plants.
At Tsumeb the concentrate is smelted at high temperatures to separate the copper from sulphide, arsenic and the other compounds it contains, leaving just the metal behind. As a by-product of extracting arsenic from the ore, arsenic trioxide is produced and later sold by DPM for the manufacturing of wood preservatives and herbicides.
As Europe and the USA have stopped using arsenic trioxide in the production of agriculture and wood treatment, DPM sells the arsenic to smaller markets in South Africa and Malaysia and stores the excess at a hazardous waste site on the outskirts of town.
The smelter is an important employer in the town and its vicinities, providing full time work for 448 people and indirect jobs for as many as 1,466 subcontracted workers. DPM also maintains a community fund.
Concerned about losing pay packets, locals were hesitant about whether to submit grievances. Yet despite the risks, they spoke out and convinced the Namibian government to conduct an audit probing the health and environmental impacts of the smelter. Finalised in January 2012, the audit concluded that the smelter was negatively affecting the environment and the health of the employees and the community. As a result, the government issued an order requiring the smelter to both reduce its capacity feed by half and adopt technological improvements.
Satisfied with the smelter upgrades which ensued, the government lifted the curtailment on the quantities of concentrate to be treated at Tsumeb in December 2013. DPM claimed to have invested over USD 110 million into emissions improvements that have reduced both inhalable arsenic levels and the arsenic contamination of the workers.
Yet, a site visit by Bankwatch staff in August 2015 revealed that these upgrades have likely not been applied to the hazardous disposal site. The highly toxic arsenic trioxide is being stored in sugar bags at a dump-site situated just a few hundred metres away from houses in Tsumeb.
The arsenic dump site in Tsumeb is situated just a few hundred metres away from residential houses.
Although set out on a non-permeable liner, the bags are unprotected from the wind and sun from the top. The site has been filled at accelerated rates and seems to be at the brink of its capacity, storing what looks like tens of thousands of tons of arsenic dust and other production waste piled in several layers already.
Since January this year Bankwatch staff have attempted to access the relevant environmental documentation, including the environmental and social impact assessment, in order to understand how DPM manages the toxic waste and prevents arsenic contamination among its workforce and the local population. However, repeated requests for a meeting with the smelter management have been turned down, just like requests to the company and the Ministry of Environment for the disclosure of documentation have proved unsuccessful.
DPM has just recently come out in the Namibian media with a rebuttal of our findings on the ground in Tsumeb. Until we receive the requested information about the improvements in the Tsumeb smelter facilities, the environmental assessment of those improvements and the environmental permits – denied to us by the company with various arguments all year – it remains their word against ours.
The same applies to the authorities in Namibia. Our right of access to environmental information laid down in the national Environmental Management Act has been impeded by the silent denial of the Environmental Commissioner. Our letter to Minister Pohamba Shifeta regarding the case remains unanswered from September.
For now, Tsumeb stands as a blatant example of a western company exporting toxic pollution from Europe to a less restrictive developing country. The fact that European development finance is involved makes EBRD shareholder governments complacent in the environmental wrongdoing associated with the mining industry. This should be sufficient reason for the bank to withdraw from financing ore extraction projects.
Bankwatch
