Glencore Xstrata the birth of a mining monster

London Mining Network briefing paper, October 2013

Introduction
Glencore and Xstrata were, until May 2013, two of the largest commodities companies in the world. Xstrata specialised in mining, while Glencore operated mines but was also a major commodities trader. oth were based in !wit"erland, but first Xstrata and then Glencore listed on the #ondon !toc$ %&change. 'heir merger in May 2013 has created a mining conglomerate, #ondon(listed Glencore Xstrata, ri)alling *io 'into in si"e. +n 22 !eptember, 2013, )oters in the small town of ,edingen in the !wiss canton of -urich )oted to gi)e 110,000 !wiss francs of the ta&es paid by Glencore Xstrata.s /hief %&ecuti)e 0)an Glasenberg to charity, in solidarity with people suffering the impacts of the company.s acti)ities around the world. 'his briefing considers what those impacts are by loo$ing at the trac$ records of both parts of the new conglomerate.

The merger
Glencore and Xstrata completed their merger on 2 May 2013, after considerable delays from regulators. /hinese appro)al was only gained in 1pril after Glencore agreed to sell one of its larger copper mining projects, easing its grip on the copper mar$et. 'he fa)oured project to sell is #as ambas in 2eru, with se)eral /hinese companies lin$ed to state(owned enterprises said to be considering offers. 'his late hurdle, howe)er, did not pre)ent the creation of a mining conglomerate holding considerable sta$es in e)ery part of the mining industry, as well as other natural resource holdings. 1 day after the merger, shares soared 34, ma$ing the group worth 563 billion. Glencore Xstrata plc is now the fourth biggest mining company, and is one of the ten biggest companies within #ondon.s 7'!% 100 0nde&. 1ccording to a *euters article on the day the merger completed, 8'he combination of commodities trader Glencore and producer Xstrata ... creates a mining and trading powerhouse with o)er 100 mines around the world, some 130,000 employees, and an oil di)ision with more ships than ritain9s *oyal :a)y.; 1t the time of the merger, Glencore9s operations in <0 countries were handling 34 of the world9s oil consumption and the combined entity was the world9s largest e&porter of thermal coal and the third(largest producer of mined copper.1 ut the result of the merger may be a company too big and too global to regulate. Glencore and Xstrata were both behemoths of companies in their own right. 'ogether, they will combine mineral production and trading, e&erting control all along the mining )alue chain =particularly in the production and trading of thermal coal>.2 7urthermore, this entity will be to a large degree under the control of Glencore.s /%+ 0)an Glasenberg, who has publicly thrown down the gauntlet to de)eloping countries see$ing a greater share of the profits from
1

?Glencore and Xstrata@ ,ow much power would they ha)eA?, / :ews, 1 +ctober 2012, http@BBwww.bbc.co.u$BnewsBbusiness(1CD<D1DCE 8Glencore seen hungry for more after swallowing Xstrata;, *euters, 2 May 2013, http@BBwww.mineweb.comBminewebBcontentBenBmineweb(mining( finance(in)estment(oldAoidF1GG<6DHsnFIetail 2 87ran$glenstrata J the birth of another mining monsterA;, #ondon Minng :etwor$, 1 +ctober 2012, http@BBlondonminingnetwor$.orgB2012B10Bfran$glenstrata(the(birth(of(another(mining(monster

the e&traction of their natural resources, saying that they will ha)e to be careful as the mining industry is forming groups to fight against such a change.3

Sustainability?
*eading the two separate companies. websites, it was notable how much space they de)oted to laying out their policies for sustainability in mining operations, with attention to Ksta$eholders. such as wor$ers and local communities. 'hese practices are held to be part of the company spirit, permeating from the board to the many di)erse holdings, an in)aluable part of maintaining the social license to operate as the companies pro)ide necessary mineral resources with the least possible en)ironmental and social impact. 0f they li)ed up to their promises, we could all breathe easier. Glencore.s corporate statistics alone J without the stories behind the facts and figures J ma$e for worrying reading. +)er the 200G(2010 period, the first period co)ered by a corporate responsibility report for Glencore J a welcome adoption of a practice otherwise considered standard J D3 fatalities were recorded, the )ast majority in Kde)eloping. countries and according to Glencore due to conditions at recently(acLuired mining operations in 1frica. :o details about permanent injury or any other health and safety statistics, which the company assured inter)iewers it did ha)e, were made a)ailable. Glencore clearly did not consider it necessary to publish these. 'hey did publish their receipt of four Ksignificant. en)ironmental fines in 2010, totalling M6G0 000. 'o put the corporate statistics in perspecti)e, in 2010 1nglo 1merican reported 20 deaths<. Nith the Xstrata merger, Glencore will now be comparable to the si"e of 1nglo 1merican. 0f the company can rac$ up nearly three times as many fatalities as 1nglo(1merican before matching its si"e, it can only be hoped that they ha)e in)ested in safety impro)ements to the new acLuisitions they blame for the woeful figures. 'his, howe)er, seems unli$ely, based on the company.s published record.

Glencore: a sorry tale

7ormed in 1CC<, Glencore has apparently prided itself on doing business in de)eloping countries considered high(ris$ by othersE on the way, being accused of dealings with rogue states, including being lin$ed to the financing of !addam ,ussein.s regime in 0raL. 7ounder Marc *ich fled the O!1 in 1CG3 after being charged with ta& e)asion, and illegal dealings with 0ran during the hostage crisis. ,is pardon in 2001 came as ill /linton was lea)ing office, and subseLuent to *ich.s e&(wife donating hundreds of thousands of dollars to one of /linton.s philanthropy projects, and contributing a round million to the Iemocratic 2arty.D 0nterestingly, current in)estigations into Glencore continue to include ta& e)asion and illegal dealings with 0ran. 'he 0talian ta& authorities accuse Glencore of e)ading o)er 120 million euros, concerning the operations of a "inc and lead smelter in !ardinia and the costs paid to other di)isions of the company for raw materials3, and O.:. diplomats ha)e )erified the accuracy of a report detailing Glencore.s supply of aluminium to an 0ranian company,

3 4

%mma 7arge, *euters, D May 2012. #eo ,ic$man and 7iona ,ar)ey, 'he Guardian, 6 !eptember 2011. 5 Glencore lands in *egina, Mac/leans, 30 March 2012, http@BBwww2.macleans.caB2012B03B30Bagainst(the(grain(2BE !wiss lin$ undermines Xstrata9s bid for NM/, 1 /, 200D, http@BBwww.abc.net.auBamBcontentB200DBs13003D1.htm 6 8Glencore 0n)estigated by 0taly on M1DG Million 'a&(%)asion /laim;, loomberg, 10 Pune 2013, http@BBwww.bloomberg.comBnewsB2013(03(10Bglencore(in)estigated(by(italy(on(1DG(million(ta&( e)asion(claim.html

belie)ed to be connected to supplying material useful for components of a nuclear enrichment program to the 0ranian go)ernment, in defiance of O.:. sanctions.6 Nith regard to Glencore.s direct mining acti)ities, the company has denied all in)ol)ement in suggested corruption o)er mineral rights acLuisitions in the /ongo, one of the most impo)erished and least de)eloped countries on %arth. 0t was suggested by Global Nitness that, from early 2010, se)eral offshore companies associated with a Mr Ian Gertler engaged in secret deals to acLuire shares of mining companies at fractions of their independently( assessed )alue J and that corrupt go)ernment officials could be among the un$nown shareholders of the companies concerned. Mr Gertler has also acted as an intermediary in Glencore.s dealings in /ongo, and is a partner in all three )entures there that Glencore has sta$es in. Global Nitness as$ed Glencore and Mr Gertler to release details of the shareholders of the companies in)ol)ed in the secret deals. 'hese were not forthcoming, both the corporation and Mr Gertler denying any in)ol)ement in corruption. Glencore.s policy, indeed, states that it will not pay or recei)e bribes, nor participate in any criminal, corrupt or fraudulent practice, nor assist third parties to brea$ the lawG. 1s the deals under Luestion with Mr Gertler.s companies were only possible after Glencore wai)ed their first refusal on the shares J e&plained as a policy implemented because of increased political uncertainty in the country at the timeC J it would be helpful if Glencore made more details of the secret deals a)ailable, to demonstrate that they had adhered to this. +f course, in this case they would no longer be secret, and as it has often been obser)ed, Glencore has a strong culture of secrecy. 0n en)ironmental and community impacts on people, Glencore performs no better. 0n 1pril 2012, the company appeared in / 2anorama in)estigation Billionaires Behaving Badly? broadcast on / 1 on 13 1pril 2012. 7aced with charges that their copper refinery at #uilu in Qatanga pro)ince in /ongo was dumping raw acid in a nearby ri)er, Glasenberg answered that the problem had been inherited when Glencore too$ o)er the running of the plant three years before, and it had not been possible to remedy earlier due to the necessity of $eeping the plant operating at capacity to pro)ide ma&imum local employment10. ,owe)er, the final solution to the problem of acid in the ri)er in /ongo came roughly a month after -ambia shut down Glencore subsdiary Mopani /opper Mines. heap leaching plant at Mufulira following complaints of acid mist emission. 1n inspection disco)ered a lac$ of any acid mist or )apour barrier to protect o)er 3,000 local residents, who had de)eloped statistical increases in pulmonary, nose, ear and throat irritants. Mopani /opper Mines issued a statement e&pressing surprise at the action, and concern that the closure would ma$e it necessary for them to lay off staff11. 0t is )ery unfortunate that Glencore appears to find it impossible to pre)ent en)ironmental damage and harm to local populations from copper treatment processes, whilst maintaining employment le)els J e&cept, in the #uilu case, shortly after a go)ernment has actually shut down a plant for pollution and in)estigati)e journalists ha)e started loo$ing at the current culprit. Glencore.s declared policy is to do all they reasonably can to protect wor$er and community safety and the en)ironment. Ne may differ with them as to what is Kreasonable.. Mo)ing on to Glencore.s policies on corporate responsibility for local communities J again, the policies loo$ good on paper. ,owe)er, the same / 2anorama in)estigation that addressed the acid dumping also found wor$ers including children as young as ten operating without safety eLuipment on a Glencore(owned /ongolese mining site. Glencore had
7

Money to Metal page on Glencore J http@BBmoneytometal.orgBinde&.phpBGlencore, updated on 1D March 2013E 8Glencore under fire o)er 0ran and in Iominican *epublic;, Mines and /ommunities, 2G May 2013, 8 Global Nitness press release, C May 2012. 9 !imon Goodley and Pulian orger, Guardian =OQ>, G May 2012. 10 Pohn !weeney, +bser)er =OQ>, 1< 1pril 2012. 11 *euters, D March 2012.

ceased operations at the plant in 200G, and stated that it was negotiating with the go)ernment to remo)e the unauthorised local miners. !o far so good, but 2anorama disco)ered that operations on the site were sending ore to a plant owned by major Glencore partner in /ongo, Groupe a"ano, and that the plant then sent copper to a Glencore(owned smelter in -ambia. 7aced with the suggestion that his company was thus indirectly benefiting from child labour, Mr Glasenberg flatly denied that Glencore purchased copper from Groupe a"ano at all, despite documentary e)idence to the contrary held by 2anorama. ,is defence was that Glencore had a strict policy of all copper being mined correctly and sent to the smelter in sealed, numbered bags, and also a strict policy against any form of child labour12. 0f the setting of a policy by a company.s e&ecuti)es ensured that it was always adhered to, Mr Glasenberg.s stance on how much pay e&ecuti)es are worth might ha)e something to it. 0nstead, Glencore appears to use policy as doctrine J a matter reLuiring sincere belief by all e&ecuti)es and other practitioners of Glencore /orporate 2ractice, or G/2 as their website refers to it. 'he policy says so, and so it is J and in)estigation into whether something may ha)e gone wrong is clearly not necessary.

Xstrata: innocent victim?

Nhen we loo$ at Xstrata.s website, $nowing of Glencore.s record, it is possible to worry that the company is about to be tarnished by its new ownership. 'heir policy is e)en more detailed than Glencore.s in the treatment they feel due to their Ksta$eholders., including wor$ers, and local and indigenous communities. esides Xstrata.s own case studies on their website of what they will do for communities where resettlement is unfortunately needed, one news report describes a community being resettled by another mining company holding up an Xstrata resettlement project as what they feel they are owed and are not getting13. 0t seems legitimate, therefore, to be concerned that the merger of the two companies largely turned into a Glencore ta$eo)er. Xstrata.s chairman !ir Pohn ond stood down during the negotiations after Xstrata shareholders )oted against a director(bac$ed plan to pay huge retention bonuses to many e&ecuti)es merely for continuing to wor$ for the combined company. ,owe)er, the original plan was for him to continue as chair of the company for a short bedding(in period. 1t the first Glencore Xstrata annual general meeting, on 13 May 2013, o)er G04 of shareholder )otes J including 0)an Glasenberg, with his G.34 sta$e in the combined company J opposed !ir Pohn.s re(election as chairman, and e)en his continuing as a director. /ommentators suggested that Glencore had successfully introduced the K$ill or be $illed. culture of the trading room into the boardroom. Many e&(partners in Glencore as a pri)ate firm, along with other staff, ha)e not only become )ery rich from the merger but are now the ones steering the company, with only two out of fourteen top di)isional jobs left in the hands of Xstrata personnel.1< Gi)en Glencore.s
12 13

Pohn !weeney, +bser)er =OQ>, 1< 1pril 2012. Nilliam :euman, :ew Ror$ 'imes, 6 Panuary 2013. 14 Merger Opdate ( Merger completed, Glencore, 2 May 2013 ( http@BBwww.GlencoreXstrata.comBassetsBOploadsB1nnouncement(of(Merger(/ompletion(2.D.2013.pdfE Magnitude of Glencore Xstrata chairman.s coup has few precedents, 7inancial 'imes, 13 May 2013 ( http@BBwww.ft.comBcmsBsB0B3cd3<G3<(be<C(11e2(Cb26(001<<feab6de.htmlSa&""2ToTf"yU0E 8Meet 'he D 2eople Nho 1re 1bout 'o ecome illionaires 7rom 'he ,uge Glencore 02+;, usiness 0nsider, D May 2011, http@BBwww.businessinsider.comBmeet(the(glencore(billionaires(i)an(glasenberg(2011( DSi&""2Tue72oj1E 8Glencore stic$s to own internal talent in merged group, *euters, 3 May 2013, http@BBwww.mineweb.comBminewebBcontentBenBmineweb(mining(finance(in)estment(oldA oidF1GG36<HsnFIetail

acti)ities, and Xstrata.s apparent concern for its sta$eholders, this could be e&pected to lead to changes in Xstrata.s operating culture and impact on communities for the worse.

Xstrata: the sad reality

+n closer e&amination of Xstrata.s actions, another picture emerges. 'o ta$e one e&ample, the Xstrata Mc1rthur *i)er mine in 1ustralia, local communities feel that the company has not listened to them and their concerns o)er en)ironmental damage, despite one group being able to claim traditional land ownership. 'he /7M% Onion there has raised concerns about breaches of +%/I guidelines by Xstrata while operating in their territories, and claims that Xstrata has been )ery obstructi)e to tal$s with the union and other organisations o)er these issues. 0n /olombia, also, Xstrata has been in)ol)ed in disputes o)er attempts to cut bac$ wor$er rights such as pay, health and pensions. 1s far bac$ as 200G, representati)es from Xstrata unions across the world met and announced the forming of an 0nternational !olidarity 7und, due to their belief that Xstrata was ha)ing a negati)e impact on wor$ers and communities across the world, and failing to act according to the high labour and en)ironmental standards the company claims on its website1D. 0n :o)ember 2012, there was a demonstration outside Xstrata.s 1GM in protest against alleged human rights infringements and pollution of the en)ironment in 2eru and /olombia. 2rotestors were joined by the go)ernor of 2eru.s %spinar pro)ince in the 1ndes, who was in the process of bringing charges against the company of en)ironmental pollution and endangering the health of local people. Xstrata ga)e the go)ernor and representati)es of the protesting :G+s seats at the 1GM, and allowed the go)ernor to deli)er his message that his pro)ince would no longer allow Xstrata to operate if they continued to pollute the en)ironment and show lac$ of respect for local people.s rights. Xstrata /%+ Mi$e Ia)is answered that the company adhered to all the regulations in the area, including setting themsel)es higher standards for en)ironmental protection than local regulations called for J and that their in)ol)ement brought in)estment to the area, impro)ing the li)es of the local population13. 'he local population, including go)ernor +scar Mollohuanca, say that when 'intaya was sold to Xstrata =in 2003> the company promised to follow the +&fam(mediated agreement signed in 2003 by then(owners ,2( illiton. ,owe)er, under Xstrata the stipulated three percent of 'intaya.s profits, worth millions, ha)e been paid into the 'intaya 7oundation, a non(profit organi"ation founded and controlled by the company itself. 'he go)ernor claims this arm of the company is using its resources to create a patronage networ$ across the pro)ince, and it certainly does not seem to ha)e been able to ma$e a significant dent in %spinar.s 3<4 po)erty rate. 7urthermore, Xstrata has always claimed that 'intaya was fully compliant with 2eru)ian en)ironmental regulations, but an independent study in 2011 found hea)y metal contamination abo)e e)en 2eru.s limits for human consumption in 2C of D0 water sources, and hea)y metal contamination abo)e the /anadian limit J 2eru, as it turns out, does not ha)e soil contamination regulations J in all 26 soil test locations.16 0n May 2012, si& months before the protest outside the 1GM, %spinar pro)ince saw one of a rash of anti(mining protests across southern 2eru. 'wo people were $illed and many injured when the 2eru)ian go)ernment brought in emergency powers to suspend freedom of assembly in order to disperse the wee$(long bloc$ade of Xstrata.s 'intaya mine. #uis *i)era, Xstrata.s operations director for 2eru, claimed that the company.s )oluntary donations to the local area were more than generous =that three percent again>, and that there was a radical political presence behind claims of ri)er pollution by the mine and demands for increased
15 16

http@BBwww.carni)alofdirt.orgBresearch(spidersB&strata(dirtB "ug<u, 21 :o)ember 2012. 17 !tephanie oyd, :ew 0nternationalist, May 2012 issue

contributions to compensate the local population for this.1G 1ccording to reports, there were around 1,D00 police officers present in the region during the state of emergency, and a group of international :G+s raised concerns that public security forces were illegally detaining and mistreating 22 ci)ilians in the 'intaya MarLuiri mine site, including women, minors, and two human rights wor$ers.1C #ater, the illegal detainees were freed J claims that they suffered torture while under detention were not in)estigated, howe)er, the go)ernment preferring to charge them with terrorist offences.20 'he cause of the )iolence was the local population.s perception that Xstrata was polluting their en)ironment and failing to abide by the carefully negotiated agreement signed with ,2( illiton o)er 'intaya. 1nd 'intaya is not the only mine where Xstrata.s interests ha)e been enthusiastically, e)en )iolently, ta$en up by the go)ernment against the protests of their own people and the reser)ations of pro)incial go)ernments o)er specific mining projects. 0n the 2hilippines, at the 'ampa$an copper and gold project in !outh /otabato on the island of Mindanao J a MD.C billion in)estment in potentially the largest copper and gold prospect in !outheast 1sia J Xstrata.s part(owned local project partner !agittarius Mines 0nc =!M0> was recently granted an %n)ironmental /ompliance /ertificate =%//> by the 2hilippines national go)ernment. 'his follows a 2010 ban on open(pit mining by the pro)incial go)ernment of !outh /otabato, which was put in place shortly after Xstrata.s first application for an %// for the 'ampa$an project21. 'his would be the same project that Xstrata itself argued against in 200G, when attempting to buy out a sta$e in !M0 held by another company, on the grounds that the project was Ka public target for )arious armed terrorist organisations.. 22 'he proposed mine has been opposed by local people on Mindanao for two decades, and besides the pro)incial go)ernment.s ban on open(pit mining, the indigenous .laan community in the area =of whom 30,000 would be displaced by the project> has declared a state of tribal war against the company. #ocal en)ironmental acti)ists e&pected in 7ebruary this year that the granting of the %// would result in e)en more intensified militari"ation in the surrounding area, already seeing )iolence and human rights )iolations, in an attempt to dissuade people from opposing the project23. 'his is not a difficult forecast to ma$e. 0n a congressional enLuiry into the e&isting militari"ation and )iolence in the area, the mayor of Qiblawan, Mari)ic Iiamante, ga)e testimony that in three towns co)ered by the mining permit, namely Qiblawan, 'ampacan and /olumbio, military and paramilitary groups were being gi)en funds for their allowance and operations by !agittarius Mines 0nc. !he e&plained that a memorandum of agreement signed in Puly 2003 by the three towns, and !M0, was the basis of the deployment of 120 paramilitaries in the area, along with the creation of the military(led 'as$ 7orce Q0'1/+. 'he 2hilippine 1rmy identified 12G security threats against !M0 from 2006 to 2012, which they see as justifying their presence in the area to pro)ide security for the company. 0n turn, the company pro)ides money for operations, for gasoline, and for the allowance of the community(based /17GO paramilitaries deployed in the area.2< 0t is this same 'as$ 7orce Q0'1/+ which has been implicated in a spate of $illings in the area. 0n +ctober 2012, an indigenous .laan woman, Pu)y /apeon, and her two children, aged 6 and 13, were gunned down. ,er husband Iaguil /apeon was $nown to be leading a
18 19

Marco 1Luino and 'erry Nade, *euters, 2C May 2012. !tatement of /oncern and !olidarity with the %spinar /ommunity, 2C May 2012. 20 1l Pa"eera, 1G Pune 2012. 21 *euters, 1C 7ebruary 2013. 22 Xstrata /opper bidder9s statement, Xstrata /opper, 13 Pune 200G 23 Qali$asan 2:% 2ress release, 1C 7ebruary 2013 24 Point 2ress *elease, 2< 7ebruary 2013

.laan struggle to defend their ancestral lands against !M0 de)elopment, and a reward was posted by Mayor Iiamante for the capture of Iaguil /apeon, who, Mayor Iiamante e&plained to the congressional enLuiry, is considered a bandit. !ur)i)ors and witnesses of the attac$ were Luestioned, and the public hearing found serious faults with the way that the attac$ was in)estigated by the military and the police.2D 0n Panuary 2013, Iaguil /apeon.s brother Qitari died in hospital after suffering a gunshot wound during an alleged attac$ on go)ernment forces. Nitnesses, howe)er, claim that the military strafed the house where Qitari was staying, and he was unarmed during the incident and unable to fight bac$.23 0n 1ugust 2012, 9laan chieftain 1nting 7reay =30>, and his 13 year old son Tictor, were murdered, allegedly by members of 'as$ 7orce Q0'1/+.26 'he *oman /atholic Iiocese of Marbel has since gi)en shelter to many .laan people, mostly women and children, who ha)e fled their homes from fear at the increasing military acti)ity in their area J in mid( Panuary, fi)e additional truc$loads of soldiers were brought in to the area by night.2G

Free, Prior Informed

onsent or not

+n the company.s website, Xstrata.s ga)e their opinion on the concept of 7ree, 2rior and 0nformed /onsent =720/>, a concept increasingly )iewed as the starting point for engagement with communities, at least indigenous communities. 'hey specify, for instance, that there is no uni)ersal standard definition for 720/, and that therefore to pre)ent misinterpretation they prefer to refer to Kfree, prior, informed consultation and participation.E specifying that according to industry guidelines, 720/ is a process as well as an outcome, reLuires good faith participation, but does not constitute a right of )eto or reLuire unanimity within a community, and does not o)erride national go)ernment rights to order resource de)elopment projects. Nhen the 0nternational 7inance /orporation adopted the term Kfree, prior, informed consent. into its performance standards in 2011, Xstrata and other mining companies Kengaged with the 07/ to see$ clarification of the definition of the term in the accompanying guidance notes.2C. Xstrata.s preference for Kfree, prior, informed consultation and participation. allowed the company to press ahead with de)elopment in 2eru and the 2hilippines against clear local opposition. 'he fact that this opposition has led to protests being )iolently put down by police, with armed forces and paramilitaries $illing women and children, does not pre)ent Xstrata from tic$ing its published set of bo&es to confirm that it possesses a social mandate to operate in the area. :either does a shared pattern of pro)incial go)ernment representati)es placing bans on Xstrata.s acti)ities or bringing charges against them while Xstrata goes to the national go)ernment to o)erride their authority.

Si! of one and half a do"en of the other

!o it seems that Glencore does not ha)e much to teach Xstrata. 'he best that may be said for Xstrata is that it appeared to deli)er the carrots it offered people to come Luietly, if they did come Luietly. /onsultation did not continue past the point where Xstrata was happy for it to continue, and if Xstrata itself was not using the stic$ against troublema$ers, it was paying people who did. Nhen we put this two(faced approach Xstrata had towards its Ksta$eholders. rights together with Glencore.s pathological secrecy and habit of Luestionable acti)ities in both the de)eloping and the de)eloped world, this combination becomes a merger made in hell. oth
25 26

Point 2ress *elease, 2< 7ebruary 2013 Pohn *i"le #. !aligumba, Ia)ao 'oday, 31 Panuary 2013 27 Pohn *i"le #. !aligumba, Ia)ao 'oday, 26 Panuary 2013 28 Minda:ews, < 7ebruary 2013 29 http@BBwww.&strata.comBsustainabilityBcommunityBresettlementB

corporations demonstrate a per)asi)e disregard for the rights of local communities affected by mining. 'hey discount, e&amine loopholes to e)ade and e)en threaten go)ernments at the regional or e)en national le)el who wish to govern the acti)ities of corporations operating within their areas of responsibility. 'he only Luestion to be as$ed would be, how much worse these acti)ities will become as the two companies combine into e)en more of a global behemothA

#ist of o$erations: Glencore

1* -inc J 1004 owend by Glencore. 1guilar mine in north(west 1rgentina. #ead and "inc processed on(site or in central 1rgentian, lead sold domestically, "inc primarily in 1rgentina and ra"il. 1* -inc also supplies sulphuric acid. 1cLuired by G#encore in 200D. /hemoil J GC4 owned by Glencore. #isted on the !ingapore !toc$ %&changeE sourcing, blending and deli)ery of marine fuels to major shipping ports worldwide, also Kclean. fuels distribution on the O! Nest /oast. /obar J 1004 owned by Glencore, from 1CCC. /obar /opper Mine, /entral Nestern :!N, 1ustralia. /opper concentrate shipped to the e&port mar$et. %H2VeLuity sta$es in two oil and gas 2roduction !haring /ontracts offshore %Luatorial Guinea, Nest 1frica, both operated by O! company :oble %nergy 0nc. 2rogrammes of e&ploration and appraisal drilling ongoing since 200D. 7irst site production from 2011, second e&pected from 2013. Qatanga J 6D.1D4 Glencore ownership, listed on the 'oronto !toc$ %&change and operating a large(scale copper(cobalt project in the Iemocratic *epublic of /ongo through two joint )entures, Qamoto /opper /ompany and I*/ /opper and /obalt 2roject. Qa""inc J 3C.314 owned by Glencore. Major fully(integrated "inc production with copper, precious metal and lead credits. /reated =and Glencore interest acLuired> in 1CC6 from the merger of three former go)ernment majority(ownership companies in %astern Qa"a$hstan. 1lso owning 1004 of Tasil$o)s$oe Gold mine in Qa"a$hstan and <G.34 of :o)oshiro$ins$oe Gold mine in *ussia. #os Uuenuales J C64 owned by Glencore. +wns and operates the mines of 0scaycru" =underground and open(pit mines, inc and lead concentrates> and Rauliyacu =underground mine, "inc and leadBsil)er concentrates> in the /entral ,ighlands of 2eru. Glencore interest acLuired, 1CCDB1CC3. Mopani J 634 owned by Glencore. 0ntegrated copper and cobalt production in the /opperbelt of -ambia. +perations based in the towns of Qitwe and Mufulira. 1lso four e&traction plants, feed sourced in(situ from leaching, )at leaching and heap leaching, two at Mufulira and two at :$ana. 0nitial interest acLuired by Glencore in 2000. Morreno J 1004 owned by Glencore,initial interest acLuired in 1CC6. +ne of the world.s largest sunflower oil and meal producers. ased in 1rgentina. Murrin Murrin J 1004 owned by Glencore. :ic$elBcobalt mining and refining project, Nestern 1ustralia. 0nitial Glencore interest acLuired, 1CC3. Mutanda Mining J 304 owned by Glencore, newly de)eloped copper and cobalt producer in the Qatanga 2ro)ince of the Iemocratic *epublic of /ongo.

21!1* J 6G.24 owned by Glencore, since 1CCC. 'he only copper smelter and refinery in the 2hilippines. 2orto)esme J 1004 owned by Glencore. 0taly.s only primary lead and "inc smelter. !ta$e acLuired, 1CCC. 2rodeco Group J 1004 owned by Glencore. 2roduces coal at its own /arenturitas =opened 200<, initial interest acLuired 1CCD> and #a Pagua =acLuired 200D> mines in /olombia, also purchases coal for e&port from other /olombian mines. *ussneft J in)esting in the *ussian mar$et ta$ing partnership in di)erse oil assets. 7rom 7ebruary 200D, Glencore subsidiaries acLuiring <0(<C4 interests in )arious *ussneft subsidiaries. !handu$a J <C.CC4 owned by Glencore. +wns and operates fi)e coal mines near iddlelburg and Qendal in !outh 1frica, the Graspan, 'ownlands, an$fontein, #eeuwfontein and #a$eside mines. Glencore interests acLuired 2003(2006. !herwin 1lumina J 1004 owned by Glencore, from 2006. 1luminiujm smelting plant located in 'e&as, O!1. !inchi Nayra J 1004 owned by Glencore, acLuired 200D. +perates fi)e "inc and lead mines, with some tin output, in the +ruro and 2otosi regions of oli)ia.

#ist of o$erations: Xstrata

%orth &merica ' anada(: runswic$ J "inc %rrington(Termillion J "inc, pre(feasibility ,ac$ett *i)er, :una)ut J "inc, pre(feasibility Qidd +perations J copper and "inc *aglan J nic$el 2erse)erance J "inc !udbury J nic$el South &merica: 7alcondo, Iominican *epublic J ferronic$el /errejon, /olombia J world.s largest and lowest cost open cut thermal coal operation 1raguaia, north(west ra"il J nic$el, scoping stage 1ntamina, 2eru J open pit copper and "inc mine #as ambas, 2eru J copper project to operate from second half 201< 'intaya, 2eru J open pit copper and gold mine 1ntapaccay, 2eru J copper, implementation stage /oroccohuayco, 2eru J copper, pre(feasibility /ollahuasi, /hile J low(cost copper operation #omas ayas, /hile J copper 1ltonorte, /hile J custom copper smelting operation 1lumbrera, 1rgentina J open(pit copper(gold mine 1gua *ica, 1rgentina J copper, pre(feasibility %l 2achon !an Puan, 1rgentina J copper, feasibility stage %nergia 1ustral, /hile J hydro(electricity project, feasibility stage &frica 'unless other)ise stated, located in South &frica(: 1frican /arbon J char production for the ferro(alloys industry

oshoe$ J chrome /har 'echnologies J char production /hrome %den J chrome %land Mine J platinum Goedge)onden J coal ,elena J chrome ,ori"on J chrome iMpun"i J coal Qroondal J chrome #ion plant J ferrochrome production #ydenburg plant J ferrochrome production Mototolo *ho)an J ferro)anadium and )anadium pento&ide 'horncliffe mine J chrome 'swelopele 2elletiser J chrome processing plant 'weefontein J coal Nater)al J chrome Qabanga, 'an"ania J nic$el, feasibility stage -anaga project, *epublic of /ongo J iron ore, pre(feasibility stage %l 1ouj project, Mauretania J iron ore, feasibility stage 1s$af project, Mauretania J iron ore, feasibility stage #ebtheinia project, Mauretania J iron ore, pre(feasibility stage &ustralasia and South*+ast &sia: 'ampa$an, 2hilippines J copper, pre(feasibility 7rieda *i)er, 2apua :ew Guinea J copper, feasibility Qoniambo, :ew /aledonia J nic$el, to produce from 2013 /osmos, Nestern 1ustralia J nic$el !inclair, Nestern 1ustralia J nic$el Mc1rthur *i)er Mine, :orthern 'erritory, 1ustralia J "inc #ady #oretta Mine, Uueensland, 1ustralia J "inc George 7isher Mine, Uueensland, 1ustralia J "inc Mount 0sa Mines, Uueensland, 1ustralia J copper, feasibility stage Mount Margaret, Uueensland, 1ustralia J copper, feasibility stage %rnest ,enry Mining, Uueensland, 1ustralia J copper, gold and magnetite 'owns)ille *efinery, 1ustralia J copper refinery owen /o$e, Uueensland, 1ustralia J co$e for smelting /ollins)ille, Uueensland, 1ustralia J open cut coal mine :ewlands /omple&, Uueensland, 1ustralia J coal +a$y /ree$ /omple&, Uueensland, 1ustralia J coal *olleston project, Uueensland, 1ustralia J open(cut coal mine Nandoan 2roject, Uueensland, 1ustralia J coal, feasibility and pre(feasibility stage Olan Nest, :ew !outh Nales, 1ustralia J coal Mangoola, :!N, 1ustralia J coal Mount +wen, :!N, 1ustralia J coal #iddell, :!N, 1ustralia J coal *a)ensworth :orth, :!N, 1ustralia J coal Onited project, :!N, 1ustralia J suspended 2010, feasibility study for future options ulga 2roject, :!N, 1ustralia J coal Nestside, :!N, 1ustralia J coal aal one, :!N, 1ustralia J coal, operations completed in 2011 'ahmoor, near !ydney, 1ustralia J coal +uro$e: :i$$el)er$, :orway J nic$el refinery and sulphuric acid production

2allas Green, 0reland J "inc, pre(feasibility rittania *efined Metal, OQ J refining lead, lead alloys and sil)er from crude lead :ordenham, Germany J electrolytic "inc production plant ,inojedo, !pain J "inc roasting plant 1rnao, !pain J "inc o&ide manufacturing facility

'his briefing was written by 0mogen !olly and edited by 1ndy Nhitmore and *ichard !olly. 0t is based on information on the Mines and /ommunities website =http@BBwww.minesandcommunities.org> and the websites of the formerly separate companies Glencore and Xstrata. !ince those websites ha)e now been superceded by the merged company.s website, http@BBwww.glencore&strata.comB, referenced articles may no longer be a)ailable. #ondon ,ining %et)or-, Finfuture, ../*..0 Seven Sisters 1oad, #ondon %2 .3&4 5eb: htt$:66londonminingnet)or-4org Phone: 78079 :/;<0/