Fisheries stalling N$3b mining deal

November 25, 2013, 10:04am

After four years of exploring and receiving a mining license, to operate on over Walvis Bay’s 2233km2, The Villager has unearthed that Cabinet’s September announcement of an 18-month moratorium on marine phosphate was more a political appeasement than scientific reality.

In September, Cabinet stopped the operations of the Namibia Marine Phosphate (NMP), citing, “Such mining activity cannot happen if there is uncertainty on what impact these phosphate mining activities could have on the environment.”
That was the first time Government took a stand on environment by making reference to the Environmental Management Act of 2007, Section 3(2)(k), which enshrines the precautionary principle in law.

However, NMP chief executive officer, Barnabas Uugwanga, argues the four years his company has spent on exploration has cost it N$160m, as Government officials had given assurances based on “world-class scientists, before the sudden about-turn.”
He says, “When we submitted the Environment Impact Assessment (EIA), the environment commissioner (EC) said they would consult the fishing industry. Fisheries scientists gave a go-ahead. Our scientist said no additional information would change their opinion, not even this moratorium because it is scientific. So we assumed only a natural disaster would change what they had discovered.”

NMP had received Mining License (ML) 170, in July 2010, from the Ministry of Mines and Energy, after completing a feasibility study and Environment Management Plan (EMP) as required by the then Act of 2007.

When the Act was amended in 2012, Government asked NMP to submit an EIA instead, before it could start operations.
“That EIA was submitted in 2012 where NMP amended the EMP to incorporate the concern, which it had not addressed in the new Act,” says Uugwanga, in one of his annual reports, which The Villager is in possession of.

In February this year, Government then commissioned an independent entity,  ” Southern African Institute for Environmental Assessment (SAIEA), to assess the EIA. Scientifically, SAIEA gave a thumbs-up to marine phosphate mining but questioned the process of how NMP had applied for the EIA by splitting it from the mining license, in just six months.

SAIEA has since identified three ‘fatal flaws’, viz, “the mining license was issued before the EIA was completed,” yet this was in accordance with the then laws. It thus questions why the mining license and the EIAs are split and all governance issued are not part of SAIEA’s mandate of assessing the EIA.

From November 2012 to June 2013, there was no communication between the Fisheries Ministry and NMP.
And when the moratorium was issued, The Villager has received documentation from the Treasury revealing how fisheries has been trying to block the rental of its vessel to line ministry scientists and the NMP scientist who want to combine their verification process.

The Fisheries Ministry first informed NMP that the vessel could not be chartered and should thus seek permission from Treasury.
Treasury questioned why Fisheries was denying NMP the vessel and then gave it the go-ahead.
“Unfortunately, I must seek a Cabinet approval to endorse the chartering of the vessel,” reads a letter from Fisheries Minister, Bernard Esau.

Initially, fisheries refused to attend NMP’s verification programme arguing the 45 days’ invitation notice was “too short”.

Phosphate and fishing versus scientist

The NMP license allows the first fully Namibian-owned company rights to operate over 2233km2. Its deposits lie 60km into the ocean and it intends to mine 140km south of Walvis Bay, where to produce a million tonnes, its dredger would need to be at sea for three months.

Environmental protection is enshrined in the Constitution of the Republic of Namibia’s Article 95 (l). Additionally, the Environmental Management Act No. 7 of 2007 lists the activities that cannot be undertaken without an environmental clearance including, among others, but not limited to mining. Therefore, NMP is no exception to this.

“Marine phosphate exploration and mining has not happened anywhere in the world, hence the Namibian government is working hard to ensure that environmental impacts particularly on fisheries, seabed and biodiversity that are likely to result from this activity are studied through a detailed EIA,” says the EC, Teofilus Nghitila.

Nghitila says in the absence of the detailed EIA, a decision cannot be taken as the impacts are unknown.
“It is our concerted view that once the verification programme, which will be done through the anticipated Strategic Environmental Assessment (SEA) is complete, it will inform relevant authorities as regard to any likelihoods of the impacts. It is also worth-noting that under the EMA, the Ministry of Fisheries and Marine Resources is the competent authority. In the absence of Environmental Clearance Certificate, the project may not proceed,” and that the question of NMP’s investment falls outside his scope of work.
However, a research by The Villager has shown currently the fishing industry has depleted more natural resources than any other form of environmental degradation.

While NMP intends to mine 2.3km2 per annum producing five million tonnes per year for the next 70 years with a revenue of N$2.4b annually, the fishing industry alone has 70 000km2 available to exploit every year, creating N$5.5b worth of revenue per annum.
Therefore, the moratorium based on this finding is based on an unscientific study.

From Government’s independent review conducted by SAIEA and led by worldly renowned environment guru, Dave Japp, the EIA report “is a good effort to address the complex issue of the impacts of the proposed mining of phosphorus.”
Wrote Benthos specialist Dr N. Steffani, “...this report is an excellent specialist study on the assessment and likely impacts on the marine benthos by seabed dredging in the proposed mining area.”

Jellyfish expert, Professor M Gibbons, also commended the scientific study saying it is an “excellent overview of the distribution ecology and biology of the two species of dominant jellyfish found off the Namibian coast.”

According to Uugwanga’s notes that The Villager is in possession of and meant for his business partners, he says, “What I find amusing is the fact that the Ministry of Fisheries, the same that gave us a license, is not questioning why Namibia should be the first country to do marine mining in the world.”

Namibia being home to one of the most productive marine wildlife ecosystems in the world, just like New Zealand, is the only country with phosphate at sea, which is economically mineable; countries like Australia could not even pull it off.
NMP’s processing is on land, the sea is only for harvesting and the EIA confirms it will not change the chemical composition of phosphate.

The truth about phosphate mining

Phosphate mining of the seafloor is a major concern for leading marine scientists worldwide as it could cause a collapse in the marine ecosystem, which provides a very important source of food and jobs in a drought ridden developing nation such as Namibia.

If approved, Namibia would become the seventh largest producer of phosphate, whose production would make fertiliser the most affordable it has ever been locally and regionally.

Ninety percent of phosphate goes into agriculture, especially for fertilisers and the remaining 10% goes to animal feed.
Fertiliser is currently the most expensive commodity for African farmers, according for 60% of farmers’ cost (input).

NMP’s feasibility study reveals benefits to Namport are abound; “The most interesting fact is that currently, bulk export at the Port of Walvis Bay is around 8000tonnes per annum. NMP will bring in 3.5million tonnes per annum, according to the conducted scientific study.”

NMP is thus bound to be the world’s first marine phosphate mine, ahead of one currently under construction in New Zealand, its scientist has said.

However, compared to fisheries and other forms of natural resources, exploitation such as mining and marine mining fall short of creating substantive employment as they can only create around 500 jobs.

The difference, however is, the fishing industry is not accommodating the idea of a new competitor in the seas, at least not at local level.

Although the urge to reform the economy is motivated, on one hand, by the need to accelerate economic growth and partly by realisation that future economic competitiveness will be driven by scientific knowledge and technology, to improve productivity and increase the value and variety of products from the country’s key economic resources, the current stand-off denies scientific research a chance. As such, it is held hostage by the need to be politically correct rather than scientifically viable.

The Nujoma element

The sudden change in tone and subsequent moratorium from Government, which had played a crucial role all along, comes after the Founding Father Dr Sam Nujoma advised the ruling Swapo party’s fifth congress (last year), that mining is finite and fishing is everlasting.

“This proposed mining of our resources at sea must be guarded against, as we must protect our aquamarine resources,” said Nujoma last December.

Following its refusal to comment, The Villager has established that NMP officials have been caught between the devil and the sea, as Government is putting brakes on all forms of research and it cannot lodge any other battle for fear of losing out on more.
Interestingly, while pursuing Uungwanga for more comments on the issue, his office revealed he was in Asia last week with the Founding Father.

"The Founding Father is in China right now. I cannot recall all the statements made by him at the Swapo Congress, as he could have made such a statement when replying to the questions that were being thrown around," confirmed his spokesperson, John Nauta.

Esau was not reachable for comment and did not respond to the questions we emailed him.

Lack of Oceans Policy to blame - Shangala

“The problem is not what the Founding Father said. The fault lies in the absence of the Oceans Policy to protect any form of resources we have. Environment, tourism, fisheries and mining departments do not have a workable document, which allows them to make a decision as one body. Currently, each one does what it feels fit, hence we sit with a license, which has been approved by the Mines Ministry but is being rejected by the Fisheries Ministry,” says Law Reform Development Commission (LRDC) chairperson, Sacky Shangala.

Shangala whose Urgent and Targeted Report on Fisheries study, which was submitted to the line ministry last December offers a scathing revelation of how lack of proper legal reform is costing Government millions, annually, through resource exploitation.
“In fishing, the quota we get does not meet the amount of resources we spend through policing and observation. The role of the Marine Resource Advisory Council is ineffective. There is no competitive diversification in our natural resource set-up. It is important that rights holders pay taxes to the fiscus as this generates revenue for the State…, a natural consequence for coastal State exploiting natural resources within its EEZ. Where entities are holders of rights, receive quotas and are perpetually scheming against the payment of taxes at the set rates whiles others are paying their taxes, evinces a bad practice.”

For Shangala, levies should be paid up before a right holder applies for a quota for the next season and in so doing, the onus of proving payment is upon the applicant.

“Applicants must not have a bad record at complying with the overall regulatory requirements relating to the harvesting of marine resources,” says Shangala’s fisheries recommendations, which the line ministry has not considered implementing.

Shangala reveals the Oceans Policy is currently waiting for the input from the Food and Agricultural Organisation, as well as the UNDP, adding, “If that came into effect, it would change how companies qualify for quotas on an annual basis.”