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Thailand close to agreement to reopen gold mine

Negotiations between the Thai government and Australia’s Akara Resources are progressing toward the reopening of the company’s closed mine in Phichit.

By Pratch Rujivanarom

Phichit, Thailand, September 3, 2017

The Nation

Negotiations to end the conflict between the Thai government and Australian gold mining conglomerate Akara Resources are progressing well, with the possibility that the company’s closed mine in Phichit will reopen.

Akara Resources stated last Thursday that it was negotiating with the government, and there was a likelihood of a “a win-win solution” in the dispute that began when Thailand suspended all gold-mining operations nationwide, which the company saw as a violation of the Thailand-Australia Free Trade Agreement (TAFTA).

In December, the National Council for Peace and Order (NCPO) issued a nationwide suspension of gold mining, resulting in the closure of Akara’s Chatree mine in Phichit. The mine had been subject to claims of pollution resulting in environmental damage and ill health among local people.

Akara’s parent company in Australia, Kingsgate Consolidated, sent a petition to the government on April 3 calling for negotiations. Akara said the issue could be brought to a tribunal for arbitration since it believed the order was a violation of the TAFTA.

Cherdsak Utha-aroon, Akara Resources head of corporate affairs, said the company’s stance in the negotiations was to have the government confirm that the gold mine could reopen. It was also seeking an assurance that the company could operate the mine until its concession expires, and that there would be consultations about mitigating economic losses from the suspension of gold mining.

“After our gold mine was closed, we submitted a letter to the government on April 3 in order to start the process of negotiations within a three-month timeframe,” Cherdsak said.

“After a meeting in late June, we have seen good signs that the government wants to resolve the conflict, so we have decided to continue the negotiations.

“We have a right to ask for compensation for the unjust closure order, and the government understands this. However, we have not spoken about financial compensation yet.”

Cherdsak said the company had not calculated the exact economic damage it had suffered from the suspension. But he noted that the gold mine has already been closed for eight months, that the average profit from the Chatree mine was around Bt6 billion a year, and that the company’s concession on the mine would not expire until 2029.

Industry Ministry permanent secretary Somchai Harnhirun confirmed that the government had been negotiating with the gold mining company and that it had set up a special committee, headed by him, to resolve the conflict. He said there had already been two meetings between the committee and the company.

“Although there is still no conclusion from the negotiations yet, we have made progress and assured that there are mutual good intentions between the disputants. They have already understood that the reason for the gold mine closure was to investigate complaints from the local people, and this is not a business seizure,” Somchai said.

Any decision to reopen the gold mine would have to wait for a decision from the mineral management policy committee, he said. According to a new Minerals Act, gold mines would be allowed to operate in the future, but they would have to be strictly managed and regulated to prevent negative impacts on people’s health and the environment.

He said the government negotiations would be based on the benefit to the country, the effects on the environment and people, and the country’s international obligations.

The Nation graphics

Maha Sarakham University lecturer Chainarong Sretthachau, however, warned that if the gold mine is reopened as a result of negotiations between the gold mine company and the government, the conflict and impact on people would continue and the government would inevitably face resentment for its decision.

“The impacts from the gold mine are real. Many people are already dead from the gold mine’s pollution and many people have engaged in lawsuits against the mine,” Chainarong said.

“I think the gold mine should be closed by other legal processes rather than using the NCPO’s special powers – for instance, through a corruption investigation by the National Anti-Corruption Commission Office.

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