You are on page 1of 21

Anglo American: The Reality

Anglo American plcs response to Mr. Philip Matteras report entitled Anglo Americans Track Record: Rhetoric or Reality? 14 August 2008

We greatly value the contribution Anglo American makes to the sustainable development of the country and the places where it operates. Minister of Mines, Chile

An international best practice The [SEAT] toolkit represents one of the most significant corporate investments we know of to equip personnel to better understand, plan, implement and account for the social and economic performance at the local operations level. Leading US NGO Business for Social Responsibility

"Anglo American has been at the forefront of creating sustainable black economic empowerment over many years." Director General, Department of Minerals and Energy, South Africa

[Anglos HIV/AIDS program] is one of the most important commitments made to date by a company in tackling AIDS in Africa. We will work with other companies in the region to follow Anglo Americans leadership. CEO of the Global Business Coalition on HIV/AIDS Tuberculosis and Malaria

[A] commitment to the communities, the region and the country as a wholewe want more companies acting like Anglo American. Minister of Mines, Chile

Anglo American: The Reality

On July 31, 2008, Mr. Philip Mattera, a private investigator based in Washington DC, published a report entitled: Anglo Americans Track Record: Rhetoric or Reality? The report was commissioned by the Renewable Resources Coalition, and Nunamta Aulukestai, two groups which oppose the Pebble project in Alaska in which Anglo American has a 50 percent interest through its US subsidiary, Anglo American US (Pebble) LLC. The question posed by Mr. Mattera is: does Anglo American live up to its stated corporate principles and the high standards they set? Mr. Mattera decides that the answer is no and presents a 34-page report to support his conclusion. Anglo American is open to, and welcomes, scrutiny of its track record, but we will respond vigorously to misrepresentation or error. The reality is that Mr. Matteras conclusion is wrong: Anglo American is recognized around the world as an industry leader in sustainability and corporate social responsibility. Numerous independent and highly respected third parties have vouched for the quality of our performance in these areas. In July 2008, Anglo American received the award for Best International Business in Africa from the Commonwealth Business Council for our leading work in fighting HIV/AIDS, our promotion of social investment and enterprise development, and our highly-regarded Socio-Economic Assessment Toolbox (SEAT). This was in addition to an award recognizing Anglo American as the company making the greatest contribution to achieving the United Nations Millennium Development Goals in Africa. In November 2007, the leading US corporate responsibility NGO, Business for Social Responsibility, hailed SEAT which helps govern the management of our relationships with our host communities world-wide as an international best practice. We have also been recognized for excellence in South America. In 2007 Chiles Minister of Mines Karen Poniachik lauded Anglo Americans energy efficiency program, and praised our commitment to the communities, the region and the country as a wholewe want more companies acting like Anglo American. In December 2007, Chiles President Michelle Bachelet presented Anglo American with a prestigious Bicentenary Seal for our commitment to fostering the development of small and medium enterprises an area where the World Banks private sector arm, the International Finance Corporation, has also recognized Anglo Americans leadership. The seal was one of the only seven handed out by the Chilean government to recognize initiatives that will create a more socio-economically equitable Chile by the time the country celebrates 200 years of independence in 2010. This year, Minister Poniachiks successor went on to declare We greatly value the contribution Anglo American makes to the sustainable development of the country and the places where it operates. Clearly the government of Chile a country where Anglo American has multiple mining operations knows the reality of Anglo American, and recognizes the Company lives up to our principles. More details of recent awards and recognition we have received can be found at: A selection of recent major awards is also presented below in Table 1.

Table 1

Selected Recent Major Awards Won by Anglo American

Most Trusted Resources Company in South Africa, Trust Barometer Awards, South Africa, August 2008 Best International Business in Africa, Commonwealth Business Council African Business Awards, July 2008 Award for Gender Sensitivity, Commonwealth Business Council African Business Awards, July 2008 Award for the Business Making the Largest Contribution to Alleviating Poverty in Africa through Supporting the Millennium Development Goals, Commonwealth Business Council African Business Awards, July 2008 Environmental Management Award for the Mantoverde Copper Mine in Chile, presented by the Regional President, July 2008 Winner in Skills Development Category, Anglos South African Iron Ore Business, national Top Empowerment Company Awards, South Africa, May 2008 Award of Presidential Seal for Contributions to Socio-Economic Development in Chile, one of just seven seals being awarded to celebrate Chiles bicentenary in 2010, December 2007 Anglo American ranked first among mining companies in Pacific Sustainability Index, Claremenont McKenna College, California, December 2007 Winner: Best Corporate and Best Overall Enterprise Development Programs in South Africa, South African Enterprise Development Awards, November 2007 Environmental Management Systems Award for Anglos Amandelbult Platinum Mine, South African national Green Mining Awards, October 2007 Sustainability Award for Anglos Emalahleni Water Treatment Project at Witbank, which treats coal mine waste water to drinking water standards for supply to local communities, South African national Green Mining Awards, October 2007 Award for best Sustainable Development Reporting in Chile, national sustainability reporting awards, Chile, September 2007

In his report, Mr. Mattera suggests that Anglo American has no experience operating in extreme conditions such as those in Alaska. In fact, Anglo American has successful operations in a variety of extreme conditions. For example, some of the Companys Chilean operations are situated at altitudes as high as 14,500 feet in the Andes; weather and temperature conditions there can be very severe. De Beers is an Associate Company with whom there is active knowledge and expertise sharing; harsh arctic conditions are the norm at their diamond mine at Snap Lake, 140 miles north-east of Yellowknife in Canadas Northwest Territories. Mr. Mattera also implies that the name Anglo American is used deliberately to be misleading. In fact, our name was based on the origins of the capital used to start up the Company in 1917: half from the United States, half from the United Kingdom. Our name has remained unchanged to this day. This document presents a properly representative picture of Anglo Americans track record, and corrects those statements of Mr. Matteras that are inaccurate, selective, incomplete or distorted representations of our record. We will take each of the ten cases he cites and present the factual story. An honest assessment of our record must reflect the historical picture. Anglo American was established over 90 years ago. Modern mining, as practiced by leading companies like Anglo American in the 21st century, bears no relation to mining in the past. Many decades ago, regulatory environmental standards were virtually non-existent, and the advanced technologies that today enable environmentally responsible mining were not yet available. Most jurisdictions now have rigorous regulations which are not only accepted but also supported by leading companies such as Anglo American. Alaska is no exception. We welcome strong regulation since it helps to ensure public trust, creates a level playing field for all companies, and creates greater predictability. We also recognize

that strong regulation reflects the high expectations that governments, communities, our own employees and society as a whole have of modern mining. Mines can have very long lives, often spanning many decades. Old mines, like other industrial facilities, were designed to different environmental standards to those that apply today. Historically, as was the case with all industrial operations, mistakes were indeed made by the mining industry, some with severe environmental or human consequences. Where Anglo American has been faced with any incidents we have tackled them energetically, as our own reporting illustrates. In fact, Mr. Matteras frequent references to Anglo Americans own reports bear witness to our commitment to open, transparent reporting. On occasion Anglo American has inherited operational problems that were not of our making. As one example, Mr. Mattera cites pollution from the Obuasi gold mine in Ghana. The gold reserves at Obuasi have been mined since 1895 and during its history there have been severe problems which have led to pollution cited by Mr. Mattera. Anglo Americans brief involvement, through our former subsidiary AngloGold Ashanti, began in 2004. Since that time huge progress has been made in tackling some very difficult issues and bringing the mine up to modern standards. The reality: Anglo American stands for high standards, high performance, transparency and continual improvement.

1. Allegation: Anglo Americans platinum operations in South Africa are a major cause of sulfur dioxide emissions and have experienced numerous spills and accidental discharges.
Reality Mr. Mattera writes about total sulfur dioxide emissions; but these are a misleading measure. As the worlds largest platinum producer, our total emissions are obviously going to be substantial in absolute terms. The best gauge of a companys performance is emissions per platinum ounce produced. By this measure, Anglo Platinum has the cleanest processes and the lowest sulfur dioxide emissions in the industry. The increases Mr. Mattera cites in 2006 and 2007 were a result of increased throughput in our smelters, not lower standards. All smelter emissions remain well within the permitted levels. And from a life cycle perspective, the production of platinum is vital for technologies that produce cleaner air such as catalytic converters in cars and low polluting sources of energy such as fuel cells. Anglo Platinum has brought its emissions from its own smelter operations down to approximately 15 tons per day in recent years, and the company is proud of this achievement it is the result of investments in research and development which produced technologies that no other platinum producer is using. Anglo Platinum was undeterred by the fact that these environmental improvements increased our operating costs relative to other producers. The reality: this is an example of good regulation and good performance by Anglo Platinum. Mr. Mattera quotes a number of examples of accidental leaks or spills taken from Anglo Platinums environmental reports. The examples he cites fall into the category of level 2 incidents by definition an incident with limited impairment of ecosystem function or surface/groundwater resources and thus no permanent environmental damage. An analogy would be a burst municipal sewage pipe: a limited, temporary impact. A major incident would be categorized at level 3. Anglo Platinum has never had a level 3 incident. As part of its corporate commitment to responsible corporate citizenship, Anglo Platinum will continue to report incidents openly and transparently to stakeholders.

2. Allegation: Acid runoff from a mine in Zimbabwe owned by an Anglo American subsidiary until 2003 has contaminated parts of the neighboring Yellow Jacket River and is believed to have harmed the rivers fish. A 2001 study of 34 mines around the world found that the Anglo operation had by far the highest level of arsenic in its surface water.
Commentary: Anglo American has not been involved with this project for five years. The company is investigating the allegations made by Mr. Mattera and will issue an updated response which addresses these issues substantively once it has the relevant information.

3. Allegation: A mining operation in Nevada was the single largest source of mercury air pollution in the United States during Anglos ownership. Recommendations to limit fish consumption have been issued for downstream fisheries.
Reality The issues raised in this section are technical and complex; a full report on the detail is therefore provided in the appendix to this response. The appended materials show that Jerritt Canyon was in full compliance with regulatory requirements at every stage of AngloGolds tenure. In fact, AngloGold went beyond compliance to play a leading role in an industry drive for greater emissions reductions on a voluntary basis, and took effective measures to mitigate and rectify water quality problems arising from historically under-designed facilities constructed well before AngloGolds involvement. As with other environmental regulations controls for mercury emissions in Nevada have evolved over the years. At no time during AngloGolds ownership did Jerritt Canyon exceed permitted mercury air emission levels. On the contrary, under AngloGolds management the Jerritt Canyon operation in addition to already being compliant with its air emission permit was a leader in pressing for additional voluntary mercury emissions reductions from mining operations in the state. Following a collaborative process involving the mining industry and regulators, the Voluntary Mercury Air Emissions Reduction Program was developed and issued in 2002 (see EPA 2005 update describing extraordinary reductionsin only three years at Implementation of this program led to reductions of mercury emissions at Jerritt Canyon of 92 percent on baseline by 2003. Mr. Mattera alleges that water bodies downwind of Jerritt Canyon were the subject of fish advisory notices. In fact, the sites identified by the Nevada Department of Wildlife ( specifically the Lahontan Reservoir, part of the Carson River, Little and Big Washoe Lake, Rye Patch Reservoir, Chimney Dam Reservoir and Comins Lake are all located west or south of the Jerritt Canyon complex. Since the dominant wind in that area is westerly, the reality is that they these water bodies are upwind of the operations. Mr. Mattera raises the important question of water quality in streams around Jerritt Canyon. There were, in fact, water quality issues associated with the waste rock dumps and tailings impoundment. These facilities were constructed beginning in 1980 well before AngloGolds involvement in the operations at a time when the comprehensive handling plans now required for such sites had not yet been developed. For example, the tailing storage facility did not have an engineered liner system since that was not the typical practice at the time it was constructed. In line with good environmental stewardship principles, AngloGold put in place a range of measures to tackle these problems during its tenure. For example, to address seepage from the old tailings facility, the company put in place a combination of facilities, including 70 water seepage collection wells, by 2003. In a striking inaccuracy, the report quoted by Mr Mattera (Kuipers et al., 2006, page 151) cites a groundwater monitoring well as showing severe exceedences of total dissolved solids and sulfate concentrations. The well in question (GW-9) is not a monitoring well; it is a seepage collection well which is designed to intercept and collect seepage from the tailings facility to prevent release into the environment. The water collected is then recycled for use in the mill process. This is, therefore, an example of good stewardship and effective engineering doing the job it was designed to do. Anglo American recognizes that there were important environmental issues needing to be addressed at Jerritt Canyon, as is often the case with old operations. But the reality is that Anglo Americans involvement, through AngloGold, reduced the operations environmental impact.

4. Allegation: A mine in Ghana operated by AngloGold Ashanti an Anglo American subsidiary until 2006 and an associated company for a year after that has repeatedly spilled waste water and tailings into neighboring communities in recent years. Scientists have found that streams in the vicinity of the mine are significantly polluted by metals.
Reality In this instance especially, context is critical to understanding the situation on the ground. Companies with high standards are sometimes faced with difficult choices. Should they avoid any acquisitions of mines in countries with a history of poor regulation, and whose mining operations have often had severe environmental or social problems; or should they be prepared to take on such operations with a clear commitment to bring them up to international standards as quickly as possible. Anglo American has chosen the harder but more responsible option. We strongly believe that we can have positive impact by investing in developing countries, and then bringing in new technology and techniques to raise standards. The required changes cannot be implemented overnight, but we know from experience that they can be delivered. Obuasi was mined for 109 years before our company had any involvement. Before AngloGold Ashantis ownership began in 2004, the mine was owned, for many years, by the Ghanaian government and subsequently by Ghanaian private investors. It was during the period before AngloGold Ashantis ownership that the environmental issues he refers to have their roots. Since as Mr. Mattera notes AngloGold Ashanti is no longer even an associate of Anglo American, we cannot comment on the detail of current operations. However, we note that AngloGold Ashanti has been investing significant sums in the mine (e.g. installation of modern environmental controls) as well as in support of communities around the mine, including its malaria control program which has brought the malaria incidence rate down by more than 70 percent. Mr. Mattera cites a report by Action Aid which contains allegations that have already been discredited. AngloGold Ashantis comprehensive response can be found at

5. Allegation: A scientific study has found that school children living near an Anglo American zinc, lead and copper mine in South Africa have elevated levels of lead in their blood and perform less well in school.
Reality The study, to which Mr. Mattera refers, though published in 2003, was actually undertaken in 1991. In reality, this was seven years before Anglo American purchased its first stake in the Black Mountain mine. On the broader question of lead pollution in South Africa, this is an issue which the company follows very closely. Lead in fuel was still in wide use during the 1990s the time period when the study Mr. Mattera cites was carried out. A further study by the South African Medical Research Council conducted in 2002-2003 and published in 2005 shows a clear improvement in blood lead levels, at a time when lead in fuel was being phased out. The company is in touch with one of the researchers who carried out the original 1991 study and who has been conducting further research recently. We await the outcome of that research with interest. Because the potential toxicity of lead is a subject that Anglo American takes seriously, under our ownership we have implemented clear and rigorous standards to prevent contamination being taken to workers homes. These standards are based on the South African Mine Health and Safety Act. They include ensuring mine workers shower and change after their shift and have their work clothing washed by the company (rather than at home), as well as delivering clear information to employees concerning lead and personal hygiene at the time of employment and on an ongoing basis. In addition, the company is conducting its own research into current soil lead levels in both the mine and the town on a precautionary basis to help guide any future actions.

6. Allegation: Numerous leaks and spills have occurred at South African mines operated by AngloGold. At one mine, chronic overflows of mine tailings water have degraded surface and groundwater of the Vaal River, and at another mine the overtopping of a containment structure caused slurry to flow into the backyards of four houses.
Reality Mr. Mattera rightly flags a number of issues related to AngloGold Ashantis operations in South Africa. He refers extensively to AngloGold Ashantis own public reports; however, his references are selective. A full account of the complex challenges and what AngloGold Ashanti is doing to address them can be found through the following links: nvironment.htm; and the case studies at: ase-studies.htm; and more specifically at: mp.htm; and rfontein-spruit.htm

Anglo American believes that Mr. Mattera raises valid points about the mining industrys responsibility to tackle environmental problems arising from old facilities that were, when compared to modern standards, inadequately designed. The detailed responses outlined in the above references show that AngloGold Ashanti takes its responsibility seriously and is working to address these problems Modern mining techniques and environmental standards have evolved well beyond those prevailing decades ago in South Africa. Anglo American welcomes this raising of standards as essential to ensuring that stakeholders have confidence that new operations built in the 21 st century will provide proper protection for the surrounding communities and the environment.

7. Allegation: Anglo has been in bitter conflict with subsistence communities and farmers in Ghana, South Africa and Mali where villagers have been displaced from their traditional lands to make way for mining operations.
Reality This section relates to issues surrounding resettlement of communities affected by mining operations. Anglo American makes every attempt to avoid resettlements if at all possible, but where it is necessary we aim for a demonstrable improvement in the standards of living of affected households. In addition, we aim to undertake resettlements with community consent, and only proceed if we have the support of local and national governments. Both community and government permission are only granted after detailed consultation, rigorous planning and permitting processes, and with appropriate compensation arrangements. Any resettlements we do undertake are conducted to standards that go beyond those that apply under compulsory purchase or eminent domain legislation in countries such as the UK or the USA. The resettlements in Mali cited by Mr. Mattera were the subject of a detailed independent study by the United Nations Global Compact. This study reveals the complexities involved, and concludes that AngloGold Ashantis implementation of its resettlement plan serves to illustrate methods of success as well as potential pitfalls. The full report can be found at: At Iduapriem in Ghana, AngloGold Ashanti became involved only in 2004, when the process of resettlement was already under way. AngloGold Ashanti has recognized that the process is not complete and that there have been difficulties. The company is working hard to resolve the specific issue of finding alternative farming land. An area has now been identified and is being reviewed by the Teberebie chief and the Resettlement Committee. Further detail can be found in AngloGold Ashantis own reports at: As for the allegations Mr. Mattera cites from Action Aid, Anglo Platinum has put out a comprehensive report responding to these allegations which can be accessed at: This report includes some striking photographs illustrating the scale and quality of the investment made by Anglo Platinum in the resettlement, including much improved housing and communal facilities and more agricultural land. It is also worth noting that about 97 percent of households in this ongoing resettlement have now willingly moved to their new, improved homes, and there have been no forced evictions. Mr. Mattera also refers to a protest by the Baphalane-Ba-Mantserre community at Anglo Platinums Amandelbult mine, but his description is incorrect. The Baphalane-Ba-Mantserre community was removed by the apartheid government from the farm Schilpadsnest long before any form of mining commenced at Amandelbult. Under South Africas land restitution process, the Baphalane-BaMantserre community made a valid land claim over the farm Schilpadsnest. Anglo Platinum has recognized this land claim, and has entered into a lease agreement with the Baphalane-Ba-Mantserre community for access to the surface rights. Apparently, certain factions of the Baphalane-Ba-Mantserre feel that, because they have the surface rights, they are also entitled to the mineral rights and that therefore they are entitled to an equity stake in the mine. In common with the great majority of jurisdictions, South African law vests ownership of minerals in the state, not the private sector. Thus, their complaint is fundamentally about South African law, not about Anglo Platinums position. Anglo Platinum has been granted the legal mining rights over these farms by the state and is not required under any legislation to give the community an equity stake. Despite this, Anglo Platinum intends to go beyond mere compliance and,

in consultation with the community, is exploring ways of sharing the economic benefits of the mine more directly with the Baphalane-Ba-Mantserre community. As for the equally complex issue of illegal mining in Ghana, AngloGold Ashanti comments fully on the issue in their Report to Society (pages 139-141) at: munity.pdf

8. Allegation: An Anglo American mine in Ireland has polluted river sediments with lead and zinc. Sections of the river were closed to anglers and public warning notices regarding heavy metal contamination were posted
Reality Anglos Lisheen mine is, as Mr. Matteras report notes, designed to the highest environmental, health and safety standards. Going beyond compliance, Lisheen established additional environmental monitoring over and above that required by Irelands Environmental Protection Agency. Although the discharge waters from the mine were in compliance with the mines license requirements, Anglo Americans additional voluntary monitoring detected anomalies in the Biological Quality Index of the river and the Company brought these to the attention of the authorities. Further research indicated the presence of metals in river sediments close to the mine discharge. The mine worked with the Irish authorities to investigate the cause of the problem. A section of the river was closed to anglers and to farmers livestock as a purely precautionary measure while studies were carried out. The research revealed that water quality was in fact unaffected. Nevertheless, Lisheen agreed a remedial program to remove the sediment from the rivers. That work has been satisfactorily completed under the close scrutiny of the relevant authorities. Following release of the findings of these studies, the regulators agreed that the sediment issue did not pose a risk to livestock or humans and all precautionary restrictions on both rivers concerned were lifted. No negative impact on the water quality was found. Throughout this process the mine maintained direct contact with affected stakeholders, such as local farmers, assisting them in finding alternative solutions (e.g. providing water for cattle) and maintaining good relations throughout the process. The EPA is now considering whether and if so what further measures need to be taken by the mine. At the same time, the mine is looking into possible extra safeguards that might be put in place. In addition, dialogue with local stakeholders revealed concerns about the health of the river that were completely unrelated to the mine. In response to these concerns and in line with Anglo Americans corporate principles Lisheen has worked with, and made financial contributions to, the local authorities to enable them to clean the river of accumulated peat and vegetation, tackling a problem that mattered to local stakeholders and actually enhancing the quality of the river. This situation is, in reality, an example of an effective regulatory system at work and exemplary collaboration by Anglo American: identifying a potential problem early on, taking sensible precautionary measures, rapidly investigating the issue, lifting those precautionary measures when studies showed they were not needed, and conducting further investigations to minimize any future risk. Mr. Mattera refers to the impact of road traffic. The mine is four miles from one of Irelands main freeways. In fact, the mine has of its own volition invested 5 million (approximately $10 million) to upgrade this small stretch of local road affected to ensure that it serves local community and mine needs alike. The report also draws attention to the planned wind farm on which construction will shortly begin at Lisheen. This project involved extensive stakeholder consultation and a tough regulatory process. The company is proud to be investing in this development which will bring on line 130 million kWhs per year of electricity the equivalent to supplying the energy demands of some 30,000 households with clean, renewable energy. This investment is in line with Anglo Americans corporate commitment to reducing carbon emissions and specifically designed to support the Irish governments own carbon reduction targets. The reality: Anglo American delivers on its commitments.

9. Allegation: Copper emissions from the Palabora mining operation, owned by Rio Tinto and Anglo American, have contaminated soil, trees and wildlife in neighbouring Kruger National Park.
Reality Anglo American has a minority stake in Palabora and does not manage the operation. The Palabora Mining Company (PMC) has been in production since 1964. In 1989 it became evident that PMCs copper dust emissions were impacting the health of cattle in the immediate vicinity of the mine. The mine immediately launched a detailed research with internal and external experts to identify the source of the problem, its extent and reduce the emissions. In 1990 PMC funded a study, through the University of Pretoria, Kruger National Park and Agricultural Research Council (Onderstepoort), to investigate copper dust fallout from the smelter operations. The research continued and resulted in a PhD thesis written by Dr Grobbelaar, concluding that dust from PMCs operations were contributing to copper in soil and fauna in the immediate vicinity. Following the results of the research, and discussions with local stakeholders, a good will payment was made to two affected farmers. Regular maintenance and environmental checks are carried out on the Smelter; this includes checking the emissions and ensuring that PMC stays within the legislated guidelines. In 1990 PMC upgraded the electrostatic dust precipitators in the reverb stack of the smelter. Subsequently, extensive monitoring sponsored by the mine continues to be undertaken. Annual collection of dung samples from wild game within a 3-mile radius of PMC began in 1990 and continues to this day. This includes the collection of samples within Kruger National Park. Since 1989 there have been no new confirmed cases of copper poisoning in either domestic or wild ungulates within the PMC vicinity. The mine continues to improve its understanding of the environmental and health impacts of smelter emissions. Since 1989 the mine has changed their operating procedures such that no reverb emissions are released without going through a dust collection system. Last week the PMC Board of Directors approved an investment for further upgrades to the electrostatic dust precipitators. Palabora Mining Company has never been formally charged by any government agency regarding the 1990 incident.

10. Allegation: Over 220 mine workers have died at Anglo American mining operations in the last five years. Mine workers have repeatedly protested against unsafe working conditions.
Reality Anglo American believes that a single death or injury is one too many a personal tragedy that can and should be avoided. Set against this demanding objective, the company agrees with Mr. Mattera that its performance on safety is not yet acceptable. Though our safety performance has been improving over the years, it has not done so nearly far or fast enough. Cynthia Carroll, who took over as CEO of Anglo American in March 2007, has made her position clear. Speaking in San Francisco in November 2007, she said I was struck by how a well-intentioned and highly motivated organization had failed to get a grip on safety. Certainly our safety record had been improving over the years, but, particularly in South Africa, there has been an attitude that since mining is dangerous, we will always have fatalities and injuries, no matter what we do. I simply cannot accept this and so I have made it our absolute priority to eliminate fatalities from our workplaces. Driven by an unstinting focus on safety from the top down, Anglo American has made safety our over-riding priority, setting consistent and demanding standards and creating real passion for its safety objectives throughout the company. In putting safety at the top of the corporate agenda, the companys leadership has been extensively recognized as marking a step-change in the South African mining industrys approach to safety. As a company with some 160,000 working in our operations, including tens of thousands in deep mines in South Africa, Anglo American faces big challenges in delivering on this vision. Nonetheless, the companys determination to deliver on its vision of Zero Harm is absolutely clear. There has been encouraging progress, including a significant reduction in fatality rates since the middle of last year, which Mr. Mattera does not mention in his report. But we acknowledge that there is still much to do. Mr. Mattera cites historical conflicts between the company and the union movement in South Africa. Of course the relationship between mining companies and organized labor has sometimes been a difficult one. However, Anglo American has a history of a progressive approach. The company was at the forefront in advocating the need for black trade unions in South Africa in the 1970s and did much to promote them. In 1972, the company set up a Department for Industrial Relations headed up by Alex Borraine, who later served on South Africas Truth and Reconciliation Commission. Overall, the company has good labor relations and a clear policy of care and respect for all employees that goes beyond our renewed focus on safety. For example, in mid-2008 Anglo Platinum unilaterally increased the pay award that it had agreed with unions to compensate for rising living costs in South Africa a gesture that was warmly welcomed by trade unions as a compassionate measure. Also in 2008, we announced our intention to extend free wellness and treatment programs for employees with HIV/AIDS to their dependents too, the first major company to take such a step. As a demonstration of Anglo Americans leading role under Cynthia Carroll in pushing for new, higher standards of mine safety in South Africa, in April 2008 we hosted a tripartite safety summit. This meeting brought together leaders from Government, labor, Anglo American and other major mining companies, and signaled a new era of cooperation in the mining industry. The summit was a direct result of Anglo Americans review of its safety performance last year.

DETAILED RESPONSE BY ANGLOGOLD ASHANTI TO SECTION 3 OF MAT TERA REPORT ANGLO AMERICANS TRACK RECORD: RHET ORIC OR REALITY? (Jerritt Canyon) Joint Venture Background AngloGold Meridian Gold. The Jerritt Canyon Joint Venture (JCJV) was a joint venture between AngloGold, as manager and 70% owner, and Meridian, as 30% owner. JCJV was permittee and operator of the Jerritt Canyon Complex in north-eastern Nevada until sale of the Jerritt Canyon Complex to Queenstake Resources U.S.A., Inc. in mid-2003. The Complex consisted of surface and underground mines located on public lands administered by the U.S. Forest Service, and milling and processing facilities for gold and silver recovery on lands owned by JCJV. Mercury Mercury Air Emission Limits o The United States Environmental Protection Agency (EPA) had not established any national or Nevada-specific ambient air quality standard for mercury. o EPA had designated mercury as a hazardous air pollutant and established national hazardous air pollutant emission standards for mercury emissions at certain stationary sources but EPA had not established such a standard for mercury emissions from gold ore processing facilities. o Prior to amendment of Nevadas regulatory program in 1995, Nevada required any source that would emit greater that one pound per hour of any hazardous air pollutant was required to install best available control technology. Nevada deleted this regulatory requirement due to the arbitrary basis of the one pound per hour threshold that did not in itself represent risk to public health. Air Emissions Permit o Mercury is a naturally-occurring compound in the ore beneficiated at Jerritt Canyon (and several other mines in Nevada). o The Nevada Division of Environmental Protection (NDEP) had issued an air emission permit to JCJV for the Jerritt Canyon Complex that authorized the release of one pound of mercury per hour per roaster (i.e., 8,760 pounds annually for each roaster) and 0.25 pound of mercury per hour per refinery (i.e., 2,190 pounds annually). Toxic Release Inventory Program o The federal Toxic Release Inventory ( TRI) program required specified industries to report releases of over 650 chemicals, including mercury, to air, land, and water. Facilities in the specified industries were required annually to report releases if they had 10 or more employees and produced or processed more than 25,000 pounds or otherwise used more than 10,000 pounds of a TRI-listed chemical. For each chemical over those thresholds, facilities estimated and reported the amount released to each environmental medium and provided information of pollution prevention and waste management activities. o In 1997, EPA expanded the TRI program to include seven new industrial sectors, including metal mining. The first year for reporting by these seven new industrial sectors was for calendar year 1998. o Jerritt Canyon (along with six other mining operations in Nevada) reported mercury fugitive or stack air emissions for the 1998 reporting year, which EPA publicly released in May 2000. Jerritt Canyon reported mercury emissions from three sources, all well below the emission limits mandated in the duly issued air emissions permit: East Roaster: 4,089 pounds (versus permit limit of 8,760 pounds) West Roaster: 4,078 pounds (versus permit limit of 8,760 pounds) Refinery: 1,229 pounds (versus permit limit of 2,190 pounds)

Jerritt Canyon had installed pollution control devices on these three emission sources with the mercury controls being considered best available control technology: East and West Roasters: each had gas quench scrubber, venturi dust scrubber, sulfur dioxide scrubber, mercury scrubber, and tail gas scrubber in series Refinery: mercury retort and condenser

Voluntary Mercury Air Emissions Reduction Program o Notwithstanding being compliant with its air emission permit, Jerritt Canyon immediately outreached to NDEP, other Nevada mining companies that reported mercury air emissions, and EPA. o These efforts resulted in the development of the voluntary mercury air emissions reduction program as issued by NDEP in February 2002 (copy attached). The purpose of this program was to achieve significant, permanent, and rapid reductions in mercury air emissions from select precious metal mining operations in Nevada. o NDEP specified on page 1 of the issued program that the mercury emitted in the mining region of the State currently poses no imminent and substantial public health threat. Nevertheless, all parties agreed that further consideration of practicable measures to reduce mercury emissions was prudent. o The program specifically recognized differences in emission controls that were installed at newer facilities versus controls at older facilities. Controls installed at older facilities, such as Jerritt Canyon, were recognized as achieving significant mercury air emissions reduction even though such controls may no longer be state-of-the-art. The program track for such older facilities was titled Process Modification Track (see page 6 of attached). Under the Process Modification Track, a facility could use its existing implemented and installed controls coupled with pollution prevention, waste minimization, or pollution abatement measures to achieve mercury air emission reduction of at least 33% (relative to baseline year emissions) by the end of 2003 and at least 50% by the end of 2005. o Jerritt Canyon immediately joined this voluntary program subscribing as an initial participant. o The voluntary program achieved a 40% reduction in mercury air emissions from Nevadas four largest gold mining companies in the first year with the most significant reduction coming from Jerritt Canyon. Specifically, Jerritt Canyon implemented activities and programs to reduce mercury air emissions to 4,740 pounds (an approximate 50% reduction of baseline) in 2002 and 790 pounds (an approximate 92% reduction of baseline) in 2003. These reductions far exceeded the reductions AngloGold committed to under the voluntary program during its ownership/management of Jerritt Canyon (i.e., at least 33% (relative to baseline year emissions) by the end of 2003 and at least 50% by the end of 2005). o Given the results achieved at Jerritt Canyon under this voluntary program during AngloGolds tenure, we respectfully disagree with footnote 33 related to the personal communication with Professor Glenn Miller about the effectiveness of controlling mercury air emissions. Fish Consumption Advisories o As noted above, NDEP stated in issuing the voluntary program that the mercury emitted in the mining region of the State currently poses no imminent and substantial public health threat. o The Mattera report alleges that Nevada agencies have issued public notices for fish consumption limits due to mercury. The Nevada Department of Wildlife (NDOW) website ( specifies the following related to fish consumption advisories : The Nevada State Health Division has issued health advisories that recommend limiting consumption of fish species from six Northern Nevada waters, due to elevated methylmercury levels. The Nevada

Department of Wildlife, the Nevada State Health Division and the Nevada Division of Environmental Protection are working together to identify and monitor potential mercury risks to the public. The health advisories recommend no consumption of fish from Lahontan Reservoir and the Carson River from Dayton downstream to the reservoir; no consumption of white bass from Little and Big Washoe Lake; no consumption of wipers and walleye and no more than one eight-ounce meal per week of any other fish from Rye Patch Reservoir; no consumption of walleye from Chimney Dam Reservoir; and no consumption of large mouth bass or northern pike from Comins Lake. Conclusion: All of these sites listed above are located west or south of the Jerritt Canyon Complex. None of these sites are east of Jerritt Canyon Complex, which is the predominant wind direction. (These sites are shown on the attached map.) The Mattera report alleges that NDOW issued notice for Wildhorse Reservoir related to consumption of bass and catfish. The NDOW website ( addresses health advisory specific to Wildhorse Reservoir, which is located some distance to the northeast of Jerritt Canyon Complex: There is no health advisory for Wildhorse Reservoir. The Nevada Department of Wildlife is providing this data to the angler community for informational purposes only. Conclusion: NDOWs website does recommend one bass or catfish meal be consumed per month; however, it is inappropriate to single out one water body (Wildhorse Reservoir) and suggest that its consumption advisory is somehow linked to the Jerritt Canyon Complex, when a thorough review of the data suggest it is a statewide concern and unrelated to a single location. For additional context, there are no fishing or consumption advisories for the nine trout fisheries sampled for mercury located in Elko County near the Jerritt Canyon Complex. Two of these fisheries are located closer to the Jerritt Canyon Complex than the Wildhorse Reservoir (see attached figures). Additionally, surface waters in northeast Nevada are routinely monitored by NDEP. Since 2000, at least 270 water samples have been analyzed for mercury concentration with all 270 analyses showing mercury concentrations at less than detection levels. (The link to the surface water mercury data is on NDEPs website at: The Mattera report alleges that fish consumption advisory has been issued for Salmon Falls Creek Reservoir. The Idaho Department of Health and Welfare (IDHW) website ( and Idaho Fish Consumption Advisory Project (IFCAP) ( ocumentsSrtView.aspx?tabID=0&ItemID=9944&MId=10724&wversion=Stagin g) identify 11 water bodies in Idaho with fish consumption advisories. These water bodies range from the Nevada border to near the Canadian border (see attached figures). Conclusion: It is inappropriate for the Mattera report to single out one water body (Salmon Falls Creek Reservoir) and suggest that its consumption advisory is somehow linked to the Jerritt Canyon Complex, when a more thorough review of the data suggest it is a statewide concern and unrelated to a single location.

Water Quality in Streams Around Jerritt Canyon Background o Mill, Jerritt, and Sheep Creeks are ephemeral streams. These streams are dominated by dilute conditions in the spring and early summer due to snow melt and runoff. These drainages go dry in the late summer months. o Burns Creek is intermittent and Snow Canyon Creek is perennial. These streams are dominated by dilute conditions in the spring and early summer due to snow melt and runoff. The lowest flows are typically observed in August-October. Activities: o Operations commenced in 1980 at the Jerritt Canyon Complex prior to acquisition by the predecessor-in-interest to AngloGold. Most of the referenced stream drainages have rock disposal areas that were designed and constructed prior to development of waste rock characterization and handling plans. o During AngloGolds management of JCJV, active reclamation practices evolved over the years. Practices included several methods to exclude and/or minimize the interaction of the waste rock with meteoric waters. These methods include upgradient surface water diversion channels, soil covers, selection of vegetation species to maximize evapotranspiration, engineered underdump drains to convey expeditiously upgradient water under the rock disposal areas, and grading and sloping of the rock disposal areas to promote snow-melt and storm water runoff. Additionally, an experimental bioreactive trench using organic materials was installed to reduce sulfate concentrations. Conclusion: AngloGold identified through surface water monitoring potential water quality matters below several rock disposal areas around the Jerritt Canyon Complex and actively managed the situation with the goal of resolving the identified matter.

Seepage from Tailing Impoundment Background o The Jerritt Canyon tailing storage facility was constructed in 1981/1982 and raised several times through 1997. The facility was constructed with native materials as the liner; that is, the facility does not have an engineered liner system as that was not the typical practice at the time. o Ground water seepage from the tailing storage facility was first noted in the mid-1980s and corrective actions were implemented. Six ground water seepage collection wells were installed on the east (downgradient) side in 1985. By 2003, the system had expanded to 70 seepage collection wells. Activities o The overall management of the seepage plume by AngloGold was carried out by a combination of the 70 ground water seepage collection wells, 11 fresh water injection wells, five shallow seepage collection trench drains, and intensive measures to reduce the water inventory in the tailing storage facility. At the time of the Jerritt Canyon Complex sale in July 2003, progress had been made to reduce significantly the water inventory (to reduce the seepage) and to expand and optimize the seepage collection program. Closure targets had been developed by AngloGold and progress was being made towards the targets. The status and development of the program since July 2003 has been the responsibility of Queenstake Resources. o The cited ground water monitoring well in the Mattera report (Kuipers et al, 2006, page 151) was identified as GW-9. This well actually is a ground water seepage collection well designed to manage and mitigate the seepage plume at and downstream of the Jerritt Canyon tailing storage facility. The elevated parameters alleged in the Mattera report are a reflection that the collection well (GW-9) is doing its job of collecting ground water seepage for reuse in the mill process.

Surface water monitoring in the perennial stream (Foreman Creek) downgradient of the Jerritt Canyon tailing storage facility (see right side of upper photograph in the Mattera report on page 12) showed concentrations of chloride, sulfate, or metals at or near background levels in the water. These data strongly suggested that the seepage remediation system was functional and was managing the seepage plume. Again, the continued collection and analysis of water quality data from the surface waters since July 2003 has been the responsibility of Queenstake Resources.

Conclusion: AngloGold actively and aggressively managed the ground water seepage plume from the Jerritt Canyon tailing storage facility with the goal of resolving the identified matter.

Anglo American plc 20 Carlton House Terrace London SW1Y 5AN United Kingdom