Last week Staff Scientist Heidi Weiskel and I joined other NGO representatives to talk with World Bank representatives as they consider financing Oyu Tolgoi, a massive copper and gold mine in the South Gobi desert.  As has been widely reported, Mongolia has become the new frontier for mining.  As ELAW has reported, the government of Mongolia has issued 3,000 mining licenses for copper, coal, gold, silver, and uranium.  The International Finance Corporation – the arm of the World Bank that provides financing to private enterprises – is one of several international financial institutions considering financing the development of Oyu Tolgoi.

The project proponent (a Mongolian company, Oyu Tolgoi LLC which is a joint-venture between Turquoise Hill Resources, Rio Tinto, and a Mongolian state-run company) published an environmental and social impact assessment (ESIA) for the project in 2012.  ELAW staff scientists and attorneys worked with partners in Mongolia to evaluate the ESIA under IFC standards.  We found the ESIA failed to meet IFC standards in several respects.  In addition to other comments, we pointed out the following violations of IFC policy:

  • The ESIA is incomplete;
  • Many critical documents underlying the findings in the ESIA have not been made available to the public; and
  • The project proponent inappropriately dismissed the application of the Indigenous Peoples Performance Standard.
Mongolian herders in Bulgan Province

Mongolian herders in Bulgan Province
Photo: Lori Maddox

We also identified several ways that the project could be improved to reduce its impact on the indigenous herders who live a traditional nomadic lifestyle. The herders’ livelihoods and their land are likely to be destroyed forever if the project is implemented as proposed.  The most urgent concern about the project is its devastating impact on water resources in this arid land.  Among other concerns, ELAW urged the IFC to ensure that the Undai River is not diverted if the project advances and to require the company to employ dry tailings instead of the planned wet tailings.  Tailings are the waste product produced from the ore extraction process and can either be stored in a massive, toxic artificial pond near the mine or dried and back-filled into the areas of the mine where extraction has been completed. Storing the waste as dry tailings could reduce the water needed for processing by 90% and reduce the impact from the mine.

Heidi and I joined Oyu Tolgoi Watch (a Mongolian NGO concerned about the impacts of the project), the Bank Information Center, Sierra Club and the Accountability Counsel to talk with Executive Directors from the World Bank about problems with the project before the Directors decide whether to finance the project.  Before these organizations addressed Executive Directors, we were able to hear directly from an indigenous herder whose family has been impacted by the mine.  He spoke eloquently about the changes that have already come to the community and the fear that the mine could destroy their traditional lifestyles forever.

Heidi briefed the Directors about concerns related to water resource management.  I have focused on demonstrating that the IFC must apply its Indigenous Peoples’ policy to this project.

ELAW will continue working with Mongolian lawyers and organizations representing the communities impacted by mining.

Jennifer Gleason
Staff Attorney