Subject of defamation suits against six South Africans again came up. This article first appeared in Moneyweb.
In apparent contradiction of claims that it planned to divest from the Xolobeni project on the Wild Coast, MRC’s annual report states that it continues to see ‘compelling socio-economic benefits’ for the area. Mining minister Gwede Mantashe has made numerous attempts to resolve disputes related to the development. Image: Moneyweb
Last week’s annual general meeting of Perth-based mining company Mineral Commodities (MRC) started off with an order from CEO Mark Caruso to switch off all mobile and recording devices.
“Why so?” asked environmental activist Louis de Villiers, a South African currently residing in Australia.
It was downhill from there. Activists wanted to know, as they did at the previous year’s AGM, whether defamation suits against six South Africans either critical of or opposed to its mining activities in SA might harm MRC’s public image. MRC and Caruso are suing the South Africans for a total of more than R11 million.
Read: Protests grow over defamation suits against environmentalists
The noise level against MRC has certainly ratcheted up a few notches, with the launch last month of a grouping of civil society organisations called Asina Loyiko: United Against Corporate Bullying. The group aims to fight Slapp (Strategic Litigation Against Public Participation) suits brought by corporate interests with the intent to suppress free speech and stifle academic freedom.
The group accuses MRC of launching Slapp suits against local activists as a way of shutting down opposition to its mining activities.
Two attorneys with the Centre for Environmental Rights (CER) were sued by MRC and Caruso after giving a presentation at the University of Cape Town in which they criticised the company’s environmental practices at Tormin on the west coast.
Last month the CER attorneys lost a case in the Western Cape High Court where they asked MRC to disclose documents related to its Tormin mining operation. The judge found that the CER attorneys should have argued their case in greater detail, as it was placing an almost impossibly burdensome task on the company by asking for so many documents.
Claims and counterclaims over killing
At last week’s AGM, De Villiers wanted to know what the company is doing to support the hunt for the killer of anti-Xolobeni mining activist Sikhosiphi ‘Bazooka’ Rhadebe, who was gunned down by unknown assailants in 2016. Two South Africans, social worker John Clarke and activist Mzamo Dlamini, have been sued for defamation by MRC and Caruso for supposedly alleging the company was involved in the murder of Rhadebe. The company has denied any involvement in the killing, while Clarke and Dlamini deny making the claim.
Clarke is alleged to be the main thorn in the side of the company, and faces 19 claims totalling R5 million for defamation – a figure that keeps growing as he shows no sign of relenting in his criticism of MRC.
De Villiers says that while asking his question on the Rhadebe killing, Caruso shut him down and wanted to know “how long have I been in Australia, am I a citizen of Australia, and then suggested that I’ve abandoned South Africa, which I clearly denied”.
Why no answers?
De Villiers also wanted answers to questions raised at the previous year’s AGM, such as clarification on whether the company intended divesting itself of the Xolobeni project, as suggested in the previous annual report. Last year the company promised to get back to De Villiers on the questions raised, but has failed to do so, he says.
MRC’s Xolobeni mineral sands project on the Wild Coast has an estimated resource of 346 megatons yielding 5% heavy minerals. This is a juicy deposit, now frozen in the ground as pro and anti-mining activists argue their corners. Mining minister Gwede Mantashe has visited the site several times in an attempt to resolve disputes between the opposing sides.
In apparent contradiction of previous claims that MRC had plans to divest from Xolobeni, its 2018 annual report states: “The company continues to consider that the Xolobeni Mineral Sands Project has compelling socio-economic benefits for the area which can be developed in conjunction with the eco-tourism and agricultural initiatives that are being put forward by various stakeholders.”
Consultation doesn’t amount to ‘consent’
MRC subsidiary Transworld Energy and Minerals Resources (TEM) lost a Pretoria High Court case last year when it was ruled that fully informed consent, not just consultation, is required of traditional landowners under the Protection of Informal Land Rights Act before mining rights are granted.
MRC’s revenue for the 2018 financial year was A$5.4 million, a 12% decrease on the 2017 figure. This was largely due to lower concentrate volumes, which was offset to some extent by better prices for zircon, rutile and ilmenite concentrates. Pre-tax profit was A$10.4 million, a drop of 25% on the prior year.
Another MRC subsidiary, Mineral Resources, produces zircon, rutile, garnet and ilmenite concentrates at Tormin on the west coast of SA, while TEM owns the prospecting rights for Xolobeni. The company also has a majority interest in a graphite mine in Western Australia, and a number of joint ventures in Iran for the production of gold, copper, potash, lithium, cobalt and nickel.
Remuneration resolution rejected
The AGM didn’t go all MRC’s way. The remuneration resolution required more than 75% of shareholder support, but only 61% voted in favour of it. This means another vote must be held within 90 days, and all “vacating directors” cease to hold office before the 90 days is up. According to Australian stock exchange rules, all directors (except for the MD) are forced to resign if the remuneration report fails to get at least 75% support two years in a row.
“This doesn’t happen too often,” says De Villiers, “and is, I believe, a huge hit against the company, demonstrating serious discontent among shareholders.”
De Villiers says he will now lay a complaint with the Australian Securities and Investments Commission over the banning of recording devices at the AGM.
