Hotline Asia Urgent Appeals -- UA020909(9)

Action Requested || Sample Letter || Background
Please respond before 30 September 2002
Update

Summary

The development of a massive potash mine in Udon Thani province, Northeast Thailand, is awaiting amendment to the Minerals Act, which would allow mining companies to tunnel at a depth of more than 100 metres beneath private and public land without the consent of landowners.

The Act, when it becomes law, will transfer all underground mineral rights to the state. The implications of this Act reach far beyond the potash mining in Udon Thani as the entire country potentially becomes open to underground mining without any consultation or consideration of surface land right holders, and leaving farmers and rural communities to bear the brunt of the resulting environmental and livelihood impacts.

The National Human Rights Commission of Thailand, local communities and independent senators were unsuccessful in trying to block the passing of the amendment bill that would allow such mining operations to go ahead. The amendments to the Minerals Act were unanimously approved by the Lower House of Parliament in late August 2002. It is expected to be enacted within 90 days.

As a result, a number of independent senators filed a case with the constitutional court, arguing that, it if it becomes law, will violate landholder property rights under section 48 of Thailand's Constitution.

Please write letters expressing your concern on this case. Please write separate letters with different salutations as below:

Sample Letter

Background

Underground potash mining and surface processing, while practiced in a number of countries without any reported significant environmental impact, are new in Thailand.

Asia Pacific Potash Corporation (APPC), 90% owned by Asia Pacific Resources Ltd based out of Canada and 10% owned by the Thai Government, holds a 85,000 hectares (ha) exploration and mining concession in Udon Thani province. The company plans to mine a thin layer of potash salt located 300 m below the surface. Potash refers to a group of potassium mineral salts used in the production of agricultural fertilisers. APPC estimates potash production for its mine to be 2 million tonnes per year. The potash mining concession in Udon Thani province lies at 350 meters (m) below the surface.

Unconstitutional:

The development of this massive potash mine in Udon Thani province needs the amendment to the Minerals Act, which would allow mining companies to tunnel at a depth of more than 100m beneath private and public land without the consent of landowners. The process to amend the Mineral Act started in 1997.

Article 88 of the draft amendment violates civil codes because it allows mining at 100m below the surface without the landowner's permission. It also infringes property rights protection clauses in section 48 of the Constitution.

The Mineral Resources Department of the Ministry of Industry, which drafted the amendment, argued the change was based on legal precedents. It cited the Land Expropriation Act of 1995 which exempts the state from paying compensation to private property owners when it builds underground public utilities such as a subway system. Opponents say the Minerals Act had been revised to benefit the two potash mining projects but public benefits were not obvious.

Impact on Environment and Livelihood:

The APPC has purchased 170 hectares (ha) of land on which processing will take place but will mine a total area of 2,500 ha beneath residential areas, farmland, a national highway, a railway linking Bangkok with Nong Khai (Northeast of Thailand) and military installations. Local communities are concerned that as the mined out tunnels progressively collapse their land and property will be damaged.

The Environmental Impact Assessment (EIA) for the project predicts subsidence of more than 70 centimetres resulting in depressions in the land surface over the entire 2,500 ha area affected by the mine. Further subsidence following mine closure after 22 years is expected but the EIA does not predict how much. In addition to structural damage to homes and infrastructure, it is likely to disrupt groundwater quality and flow, drastically alter natural drainage patterns, sending streams off course and potentially creating water logging and flooding problems.

Moreover, local communities anticipate severe salt contamination of agricultural land and water resources as the mined mineral is composed predominantly of rock salt (sodium chloride). The pure potash product will have to be extracted on site, leaving the rock salt, chemicals and other waste to be stored at the surface until further reprocessing. Salt dust will be continually emitted from an exhaust stack during extraction and mineral processing, eventually settling on adjacent farmland, destroying crops and degrading soil.

The salt waste however, is the primary concern of village people: 20 million tonnes of salt waste will be stored at the surface in a 40m high dumps which will be uncovered and exposed to wind and rainfall. As rainfall dissolves this salt it will flow into a brine pond and there is a very high likelihood that it will leak into the soil beneath. As it seeps into the ground it will enter and contaminate the thin and fragile layer of fresh groundwater that local communities rely on for domestic water supply.

In the case of unusually heavy rains or large floods, there is a high risk that dykes (earth dams) designed to contain the waste area will be breached and 20 million tonnes of salt could be released into the environment causing devastation for rice farmers, destroying forests and polluting lakes, reservoirs and rivers.

Benefits Claimed that might Lead to 'National Benefit' rather than Environmental and Livelihood Impact:

According to the information provided by the Asia Pacific Resources Ltd, the benefits that Thailand will gain are as follows:

• Thailand will no longer need to rely on imported potash, but will instead export into the growing demand of the Asian region. Clarkson Research Studies has pointed out that some 50% of the world's fertiliser production is consumed in Asia, with China accounting for a quarter of world consumption.

• Once the project is given a full go-ahead, the balance of payments of Thailand could benefit by an estimated $5bn over the 25-year mine life.

• Taxes, royalties and a dividend paid to the Thai government under its 10% ownership of the corporation should amount to $1bn over the same period.

• Under full production, 900 people would be employed, and 4,000 indirect jobs were likely to be created over the lifetime of the mine.

Sources:

• Bangkok Post
• The Nation
• Foundation for Ecological Recovery (FER)
• Asia Pacific Resources Ltd

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