Editor's note: Escalation of the bauxite mining problem in Pahang with January's 3 month stop-work and MACC investigation. Speaking with a Pahang politician, I hear that there had been less opposition (compared to the Lynas rare earth processing plant) as more locals have financial benefit from the bauxite mining and its supply-chain.

3 February 2016: Chat with a local observer on bauxite riches hope of the 10 acre smallholder

Update from a reader, 3 Feb afternoon:  It should be possible for the smallholders with the help of a competent lawyer to insist when they sell the bauxite in their land, that the topsoil be carefully stored to one side of the site and leveled back over the site when mining is complete. There is no reason why oil palms should not grow as well as before under such conditions. This is a regular requirement in Australian mining contracts.


Editor's note: I was recently on the line with a Kuantan-based businessman - a keen local observer. Some background information on the economic calculus for smallholders and mining as follows,

a) For oil palm 10 acre lot (e.g. Felda smallholder), the outlook is that the (illegal?) miner clears the land in 3 months and pays RM 7-10 per tonne, and then it also depends on yield. The smallholder hopes to earn RM1-1.5 million. However the more likely payout may be RM700k-RM1.5 million. A 10 acre plot has about 200,000 tonnes of material. Palm oil experts say that it is not possible to replant oil palm on this land any more.

b) The 3-month moratorium was a bad hit, as this makes some of these deals null and void. Politicians have been greatly concerned about the interest of these smallholders.

c) Locals point out that the China buyers came to Malaysia because Indonesia stopped exporting. These buyers are paying US$29-30 per tonne, and if you clean up the clay a bit you can get US$60/tonne.

d) If you drive your car from the mining area to the Kuantan Port, the entire road is red-desert dusty. During the monsoon season, when this is combined with dust, your car is "repainted" red.



Picture screenshot source: http://www.thestar.com.my/news/nation/2016/01/10/settler-rejects-rm1mil-bauxite-offer/

Others in the palm oil sector have written: Felda settlers are cutting down their palm trees to allow bauxite to be mined on their land. This is very short term once off gain. Once the top soil is removed it will take 10-20 years before oil palm can be planted again so there is no income from the palm fruits until then. Simple maths for 4 hectares of palm oil planted. Once off bauxite payment is RM300,000 (if it is really paid). Loss of continuous income for years at RM50,000 per year. In addition to the social economic issues there are also serious environmental issues.

11 January 2016: News links

Miners threaten violence BY QISHIN TARIQ 11 January 2016; ... Offers of money, con men and threats of violence have become the bane of families living in the Felda settlement in Bukit Goh here ever since the area was identified as a huge deposit of the “red gold” – bauxite. Settler Mohd Hamdi Shuib, 49, said his father went into depression after being conned by contractors who wanted to mine the family’s 10ha lot. He said the contractors offered RM200,000 but after paying RM40,000 and clearing off the family’s palm trees, they did not mine the land or pay the balance. “Ayah pening (My father doesn’t know what to do),” he said. Without palm trees to harvest and no payment from the miners, the money quickly ran out, as settlers are required to pay Felda RM47,000 in replanting fees if they cut down their trees. “Luckily, it was a contract kedai kopi which allowed us to exit the deal,” said Mohd Hamdi, adding that many other settlers were not as lucky. He said the contractors threatened his family when he approached other contractors to do the mining. “But nothing untoward happened.”....http://www.thestar.com.my/news/nation/2016/01/11/miners-threaten-violence-contractors-also-offer-money-to-felda-settlers-but-shortchange-them-instead/

Solace in moratorium BY AFIQ ISA  11 January 2016; ... The moratorium concerns three key stages. The first is to clear all stockpiles at the Kuantan Port. The second is to remove stockpiles outside of port areas, which are said to have contributed to the pollution of the sea. The last stage is the construction of a central area to house washing and storage facilities for the bauxite deposits to be stored. Abd Wahid added that a lack of infrastructure to handle ore and bauxite deposits had exacerbated the problems in Kuantan, where large stockpiles are kept in open fields, while part of the deposits may seep into the sea. The moratorium will no doubt be a short-term pinch for operators who currently trade or mine bauxite in the state. http://www.thestar.com.my/business/business-news/2016/01/11/solace-in-moratorium/

Kuantan folk avoiding raw water and fishing  11 January 2016 http://www.thestar.com.my/news/nation/2016/01/11/kuantan-folk-avoiding-raw-water-and-fishing/

Buyers fear harm from fish BY FOONG PEK YEEandADRIAN CHAN 11 January 2016; Consumers buying fish here are being extra careful – they fear the controversial bauxite mining in Kuantan, about 195km away may have caused environmental pollution and eating the fish may prove harmful. At the Bentong market here, a fishmonger identified only as Wong said there were those who were scared to eat fish from Kuantan for health reasons. “Falling sick is very costly these days,” she said, referring to the high cost of medical treatment, when met at the Bentong market here. She said she and her husband had been fishmongers for some 20 years and they sourced their fish from the Selayang wholesale market in Selangor. She said there were several factors affecting the price of fish, and she reckoned that the bauxite scare might have resulted in a slight rise in prices recently... http://www.thestar.com.my/news/nation/2016/01/11/buyers-fear-harm-from-fish-fishermen-allay-concerns-that-there-is-bauxite-contamination/

Potential bauxite ban may dent China stockpiles 5 January 2016; A potential suspension on bauxite mining in Malaysia, the world’s top exporter of the aluminium-making ingredient, could dent stockpiles in China but is unlikely to curb breakneck output in the aluminium sector there, industry and analysts said yesterday.... World prices for aluminium, used in everything from planes and trains to packaging, sank to their lowest in more than six years last November as China grapples with oversupply fuelled by its slowing economy. That forced China’s loss-making industry to band together to pledge production cuts, with markets looking out for any other signs output could ease.... “A suspension in Malaysian bauxite mining will impact stockpiles, but it won't impact China's metal production,” said Paul Adkins, managing director of consultancy AZ China. He added that a three-month ban could shave about six million tonnes off China’s current bauxite stockpiles of around 25-30 million tonnes. Malaysia accounted for over 40% of China’s 49 million tonnes of bauxite imports across January to November last year.... The country’s largely unregulated bauxite mining industry has grown rapidly since Indonesia banned exports of the material in early 2014, forcing China to seek supplies elsewhere... http://www.thestar.com.my/business/business-news/2016/01/05/potential-bauxite-ban-may-dent-china-stockpiles/

The bauxite boom or bane BY AFIQ ISAandINTAN FARHANA ZAINUL 19 December 2015 http://www.thestar.com.my/business/business-news/2015/12/19/the-bauxite-boom-or-bane/


MB wrong, bauxite mining killing our businesses, say locals BY MUZLIZA MUSTAFA 8 January 2016  - See more at: http://www.themalaysianinsider.com/malaysia/article/bauxite-mining-ruined-our-business-say-local-residents#sthash.eTEj71oJ.dpuf

10 January 2016 - News links

NGO prepared to help curb abuse by bauxite miners by Bernama | Published on January 10, 2016; It is learnt, 248 of the 762 Bukit Goh settlers had allowed bauxite mining on their land involving an area of 1,005.6 hectares since 2013 to date.   Wahid was also fo the view that the three-month moratorium starting from Jan 15 as sufficient and it was not necessary to extend it as the mining activities are a source of income for the settlers involved. "We abide by the decision for a three-month halt to give time to the government to improve all earlier weaknesses," he said.  http://english.astroawani.com/malaysia-news/ngo-prepared-help-curb-abuse-bauxite-miners-88831

Settler has no regrets turning down RM1mil bauxite offer  10 January 2016; KUANTAN: A resident of Kampung Felda Bukit Goh is determined not to lease her land for bauxite mining despite getting an offer of RM1mil as payment.   Salwani Tajuddin, 37, said even though many of the villagers had become “instant millionaires” after leasing their land, their lives seemed to be listless...Salwani said early last year, she was approached by a man who offered her a deposit of RM500,000 to mine bauxite in her four-hectare oil palm plantation, which she rejected.   She said the man, however, came back a few days later to offer a higher amount of RM1mil.   "After I turn down the RM1mil offer, the man was furious and said I was 'stupid' for rejecting that much money.   "But for me, those who lease their land to bauxite operators are the real losers as the money can only last for a while, and their land will not return to its previous condition," she said. As a settler for the last 18 years, Salwani said she did not want her land to be affected by bauxite mining activities. She was also approached by the same man a few months later requesting that her land be used as a “stockpile” area for lorries and bauxite ore with a payment of RM5,000 monthy but she turned it down.... Her father Tajuddin Harun, 68, who runs a food stall at the village said bauxite operators did not fulfil their promise to provide a monthly compensation of RM1,000 for every trader and RM500 for every house.   Tajuddin said he only received a compensation of RM1,000 in November.  "Instead, business is affected as not many customers are patronising our stalls due to the dust from the lorries carrying bauxite. And I am forced to fork out RM6,000 to instal this canvas (to cover the stall)," he added. - Bernama  http://www.thestar.com.my/news/nation/2016/01/10/settler-rejects-rm1mil-bauxite-offer/

MACC nabs three more over illegal bauxite mining 10 January 2016  http://www.thestar.com.my/news/nation/2016/01/10/macc-nabs-three-more-over-illegal-bauxite-mining/

Three more arrested for allegedly protecting illegal bauxite miners  by danial albakri 9 January 2016; “All the individuals, aged between 44 and 59 years of age, are members of the public.  “They are believed to have acted as middlemen in the illegal sale of mineral ore transportation documents or Form 13D to unlicensed miners.    “They have been remanded for seven days starting today in order to aid in the investigation following Section 17(a) of the MACC Act 2009,” it said. The MACC said it was still conducting investigations to locate those who were involved in bribery that allowed illegal mining activity that accumulated an estimated total of RM187mil in lost royalty last year. http://www.thestar.com.my/news/nation/2016/01/09/bauxite-mining-three-more-arrested/

Transport Ministry wants bauxite-hauling lorries to slow down  by adrian chan 9 January 2016; "They are a danger to residents and are polluting the environment," he said, referring to the clouds of bauxite dust that lorries kick up. Liow said the proposal was being studied at present, believing that the limit could be lowered.  He added that if drivers continue to flaunt the rules, the Ministry would be forced to impose a "black box" ruling on all lorries transporting bauxite to automatically limit its speed. The Ministry, according to Liow, was also planning to restrict the number of routes allowed for transporting bauxite. "We also want to ensure lorries are cleaned and covered up before driving on main roads," he said. http://www.thestar.com.my/news/nation/2016/01/09/transport-ministry-wants-bauxite-hauling-lorries-to-slow-down/

Perlis mufti: Pollution from bauxite mining more dangerous than vape  8 January 2016  http://www.thestar.com.my/news/nation/2016/01/08/perlis-mufti-pollution-from-bauxite-mining-more-dangerous-than-vape/

Pahang princess glad but questions duration of bauxite mining ban   8 January 2016 http://www.thestar.com.my/news/nation/2016/01/08/pahang-princess-glad-over-bauxite-mining-ban-but-questions-duration-of-stop-order/

Earlier news

Putrajaya not learning from past mistakes, says Rafidah over bauxite controversy Published: 7 January 2016 - See more at: http://www.themalaysianinsider.com/malaysia/article/consider-environment-before-approving-projects-says-rafidah#sthash.7HHZpu3c.dpuf

Fishermen claim their livelihood affected by bauxite contamination by Bernama | Published on January 03, 2016; "For years we have endured hardship as a result of bauxite mining activities, our income is affected due to poor 'harvest' how long will this persist?  "In the past, we can easily catch 50kg mackerels, but now it is so hard to even get 10kg," he told Bernama here, Saturday.  Che Daud said the situation became serious during the recent monsoon season where the water in the coastal areas including the Balok beach had been contaminated with minerals.  Another fisherman Mustaffa Ibrahim, 52, claimed that the red bauxite-contaminated water not only affected the Balok river and Batu Hitam beach but also the ship route carrying the mineral from the Kuantan Port.... http://english.astroawani.com/malaysia-news/fishermen-claim-their-livelihood-affected-bauxite-contamination-87790

Stopping the red tide  31 December 2015; BAUXITE mining in Pahang and Terengganu which generates millions in revenue, yet appears to be running riot now, will need regulatory tightening to protect the health, quality of life and environmental future of affected communities. And, reining in illegal miners is central to the exercise. There has been a tremendous surge in unregulated bauxite mining activities in the two states, largely to satisfy the hungry Chinese market following Indonesia’s ban on the export of bauxite ore, used for aluminium production. Notwithstanding the economic benefits, the feeling is that the unregulated multimillion ringgit industry is doing more harm than good, as people in Pahang have begun to observe even seawater turning red.... The latest incident took place yesterday, when the normally clear water between Sungai Pengorak and Pantai Batu Hitam in Pahang turned murky red, after heavy rain from Sunday until Tuesday. Some residents living along the beach believe that the phenomenon was caused by extensive bauxite mining activities which had blown clouds of red dust towards the sea. There was no official explanation for the occurrence, but environmentalists have said that local rivers and the shores along Kuantan were frequently stained red from mining run-off. Residents have also complained of a rise in respiratory problems and skin rashes. Prolonged exposure to polluted water and red dust from bauxite mining can increase the risk of developing cancer, say experts. Marine life, too, will suffer... In August, the NST Special Probes Team, through a series of articles, highlighted the issue of environmental deterioration and toxic contamination of water from bauxite residue. Independent laboratory tests had revealed that water samples from the affected areas contained high levels of heavy metals and traces of radioactive, which were hazardous to humans.... Alarmed residents in Pahang wonder if they can trust the authorities to act in their interest. They accuse the authorities of turning a blind eye to what is happening. The illegal miners have allowed greed to overtake their principles. They are reaping a windfall — earning up to RM66 million a month — from the uncontrolled mining of bauxite and it would be hard to stop them, unless the authorities act swiftly and decisively. There are indications that leaders are responding to the alarm raised, and rightly, too. Pahang revoked the licences of 34 mining contractors in July, and Terengganu made the move to freeze all bauxite mining applications in September...http://www.nst.com.my/news/2015/12/119814/stopping-thered-tide

Pahang MB lashes out at bauxite industry players  by ong han seanandqishin tariq 17 December 2015; “I have met, at least four times, with the operators, contractors and transport operators advising them to take into consideration the hardship the people are experiencing due to their irresponsible mode of extracting the ore. “Sadly, this advice has fallen on deaf ears,” he said. The Federal Government also stepped in to help. “InsyaAllah, the state government will come up with a comprehensive plan to manage this issue by the end of the year. “In the final analysis, the social benefit and welfare of the innocent common people must outweigh whatever economic benefits,” said Adnan. The Mentri Besar also expressed his appreciation to the press for reporting on the bauxite mining activities in Pahang. The Star on its front page yesterday reported about experts raising the red flag that the bauxite mining areas in Pahang could cause dangerous mudslides and worsen floods if monsoon rains lash the state.  Even those who support the mining activities are calling for a stop until the rains go away....http://www.thestar.com.my/news/nation/2015/12/17/pahang-mb-lashes-out-at-bauxite-industry-players/
 
Bauxite mining probe hits IPO-bound Spring Energy By F Saad Friday, 16 Oct 2015; Spring Energy Resources Bhd’s bauxite mining – and therefore its initial public offering (IPO) – may hit a snag after the Pahang government’s decision to revoke most bauxite-mining licences. “A large portion of the company’s future income is meant to come from bauxite mining. In any case, the state is looking into all bauxite mining, legal and otherwise, which could interrupt the day-to-day processes of the business and slow income. This means the company must come up with alternatives and approach the Securities Commission to see if it can go ahead with the IPO,” says an investment banker.Bukit Goh near Kuantan, occupied mainly by Felda settlers, was in the spotlight in July after it was found mining in the Felda settlement was not sanctioned.Many settlers say they have been cheated by miners who had promised payment in return for mining on oil-palm plantations. Felda has since ceased all mining in the area.That month, Pahang’s government revoked the mineral-ore licences of 34 contractors, as mining in the state grew rampant. Only 11 operators have been allowed to continue. - See more at: http://www.focusmalaysia.my/Mainstream/Bauxite%20mining%20probe%20hits%20IPO-bound%20Spring%20Energy#sthash.N4oR7Dda.dpuf

Sue bauxite miners yourselves, Pahang MB tells Felda settlers Published: 18 July 2015; ...He said the Felda settlers would have to file the suits themselves because the state government was unable to press criminal charges against the bauxite miners who had struck a deal with the settlers. "The (state) government cannot help them. If they have been cheated, they can sue the other party, but it is not easy," he said at his Aidilfitri open house yesterday. googletag.cmd.push(function() {googletag.display('div-gpt-ad-1400601790726-3');}); It had been reported that miners had offered between RM50,000 and RM100,000 to the Felda settlers to extract bauxite from their land now planted with oil palm....It had been reported that 71 settlers in Bukit Goh, who had allowed their land to be mined for bauxite, claimed they had been cheated in the deal. Some of these settlers had received a notice from the Land and Mines Office stating that they had committed an offence by mining without a licence or not having mortgaged their land legally under the Mineral Enactment 2001. They face the possibility of being fined up to RM500,000 or sentenced to a maximum jail term of 10 years, or both, upon conviction. – Bernama, July 18, 2015. - See more at: http://www.themalaysianinsider.com/malaysia/article/sue-bauxite-miners-yourselves-pahang-mb-tells-felda-settlers#sthash.TCXiNjBC.dpuf