Report on the Rio Tinto plc AGM, London, 8 April 2022

By Richard Solly, Co-ordinator, London Mining Network, with assistance from Andy Whitmore, Richard Harkinson, Roger Featherstone and Yvonne Orengo


Despite the unpleasantness of mining company AGMs, it was good to be back at an in-person meeting again. The Rio Tinto AGM’s hybrid format, including attenders at the Queen Elizabeth II Conference Centre and online, seems to me a good way of maximising attendance and participation. Furthermore, unlike some of its rivals, Rio Tinto posts a video of its whole AGM, including the whole Question and Answer session, on its website after the AGM. Credit where it’s due…

The promotional video played immediately before the meeting began made much of Rio Tinto’s involvement in the shift to a low carbon economy. The company has set new climate targets and is progressing decarbonisation projects. It is also ‘facing hard truths’ about the need for indigenous voices in the company. It is now taking account of indigenous views to enable better decision-making. The recent Broderick Report on the company’s work culture has led to a commitment to implement its 26 recommendations. It is leaving a lighter footprint, improving its management of water (which will be increasingly critical) and building partnerships with communities. At least, that’s what the video told us.

Chairman Simon Thompson’s introduction included comments from Ben Wyatt, a new indigenous Australian director, who acknowledged that Rio Tinto operates on First Nations land all over the planet. Apparently the company is reflecting deeply on its corporate culture and is transforming itself as it looks inward while also producing extraordinary results. The great challenge is the decarbonisation of the planet – that is the challenge and opportunity for Rio Tinto.

Dominic Barton said he is excited about taking over as Chairman from Simon Thompson (who is leaving as part of the shake-up after the destruction of Aboriginal rock shelters at Juukan Gorge in Australia in 2020) because of Rio Tinto’s mission to help the transition to a low carbon world.

The company is apparently focused on rebuilding trust with communities. Its strategy has energy transition at its heart. And 2021 was its third fatality-free year.

Rio Tinto, we were told, has a critical role to play in the energy transition, supplying copper, lithium, high grade iron ore and aluminium, all of which are critical. The acquisition of Rincon in Argentina, the commencement of underground mining at Oyu Tolgoi in Mongolia, and the decision to go ahead with the Simandou iron ore mine in Guinea, are all part of this process. At the same time, Rio Tinto is reducing its Scope 1 and 2 carbon emissions and is working to reduce its Scope 3 emissions.

Chief Executive Office Jakob Stausholm acknowledged and paid respect to all First Nations around the world on whose land the company operates.

He noted that there is a humanitarian crisis in Ukraine. Rio Tinto has no operational assets in Russia or Ukraine, he said. The company is in the process of terminating all commercial relationships with Russian businesses and will donate five million dollars to emergency relief.

He said that the Broderick report had shown that many workers in Rio Tinto experience bullying, sexism and racism. “This is not the kind of company we want to be,” he said. Rio Tinto will implement all the report’s recommendations. It needs to be a less hierarchical and more humane place to work. The company wants to restore its reputation as the best operator in the business and have impeccable ESG (Environmental, Social and Governance) credentials.

Rio Tinto has committed billions of dollars to the Jadar lithium project in Serbia. The Serbian government has cancelled the company’s spatial plan, but Rio Tinto remains committed and is exploring all options with the local communities.

He said that the company is moving forward with its plan to respect cultural heritage. Let’s hope the plan is more effective than previous plans, which seem to have combined good intentions on paper with high explosives and extreme insensitivity on the ground.

An important theme running through both introductory addresses and the answers to many of the shareholder’s questions below was that Rio Tinto’s mineral production was vital to save the planet from the catastrophe of climate change.

Let us not forget that over the years, and until quite recently, Rio Tinto has mined an awful lot of the coal which has helped bring us to the point of climate apocalypse. Now, in the face of the winds of change blowing from certain large institutional investors, the company has sold out of coal and is concentrating on digging up enormous quantities of minerals which will, in part, be used for renewable energy, batteries and electric vehicles. (Of course, a lot of such minerals are used in weaponry, as our report Martial Mining makes clear; and unless the wealthier inhabitants of the world restrict our mineral consumption we are going both to run out of minerals and convert the planet into a vast toxic rubbish dump, as the reports A Material Transition and A Justi(ice) Transition is a Post-Extractive Transition point out – see the Reports page of our website.

One of our Finnish contacts, concerned about the company’s plans in their area, commented, “I noticed that the board’s response to many of the issues and concerns was to stress the importance of metals for the green energy transition. By saying that, do they imply that environmental and social justice suddenly matter less? The green transitions shouldn’t mean that people and places will just need to be sacrificed while others make huge profits out of it.”

You can find background information about many of the issues raised in the Question and Answer session in Investing in Rio Tinto? Here’s what the company won’t tell you… and Grief and Grievance: the misery of life with Rio Tinto as a neighbour.

Questions and answers

1. Social licence at QMM in Madagascar

[A full report on all the questions on QMM in Madagascar, together with an analysis of the company’s responses, is on the website of the Andrew Lees Trust.]

Stephen Power, a trustee of the Jesuits in Britain, explained that the Jesuits are institutional investors in Rio Tinto. He said he was concerned that there are strong indications that the company may be losing its social licence at Mandena in Madagascar. Many villagers have been occupying the local town hall in the wake of a loss of income of up to 50% recently. The previous week the President of Madagascar had talked of holding Rio Tinto responsible for the impact of the failure of the dam structure, death of aquatic life and water quality issues. Is QMM in danger of losing its political licence to operate in Madagascar?

Simon Thompson replied that this relates to the recent report by Publish What You Pay (PWYP) which he had scanned but had not had a chance to study in detail because it had only recently been published. When you build a mine in a very poor country, he said, it does create inequalities. Before the mine was there everyone was uniformly poor and when a mine arrives and creates very well paid jobs it increases inequality in communities. In Madagascar with the arrival of QMM the company had created over 2,000 well paid direct jobs and induced a further 11,000 jobs as a result of the mining. The company had brought clean water to the town of Fort Dauphin, where many employees live. QMM had handed the clean water facility over to the government and is now building clean water facilities for three rural communities closer to the mine. But there is a divide between the urban population who obtain jobs and who the company supplies with power and water and rural communities nearer the mine do not share in those benefits fully, so the company is working with stakeholders including the World Bank to redress that balance. The company would never be able to do it in full, but could strive to do so. It was converting power production to solar and wind and would be able to supply power to two communities close to the mining operations as well as Fort Dauphin. It needs to step up engagement with local communities and has put a great deal of effort into this over the past year, and is building better relations with civil society organisations and communities.

He said that the Minister of Water had made the comment about holding QMM responsible for the fish deaths that occurred close to QMM’s operations. It is a complex story. In the early months of this year Madagascar suffered extreme weather after a prolonged drought. There were three cyclones in a few weeks during February and March which deposited half the typical annual rainfall in a few weeks. The level of ponds at the mine is kept below the level of water outside so that should there be any overflows it would be from the external environment into the mine, but because of this extreme weather there was an accumulation of water in the pond areas and the company had to release some water into the external environment, which it had not done for well over 18 months. It did so with the permission of the National Environmental Office and involved local communities in the process, providing local communities with clean drinking water while mine water was being released into the environment. Fish deaths were reported a few days later further out in the waterways. The company investigated this with the National Environmental office and found no signs of contamination with heavy metals and no toxicity, so the fish deaths are not explained. The water was extremely turbid because of the floods, which washed sediment into the waterway where the fish were found. The company was surprised by the minister’s comments as the analysis by the company and the National Environmental Office does not suggest any link with QMM’s activities, but it will continue to engage with the Minister of Water to try to understand what steps it should take. The company is about to open a water treatment plant at QMM which will provide a permanent long term solution, allowing the company to release water back into the environment which will be at least as good as the water in the surrounding environment. The company is also advancing a programme to provide drinking water for people around the mine.

2. Indigenous rights and worker deaths: is the board dangerously out of control?

Shareholder John Farmer asked a number of questions and suggested that the Rio Tinto Board was ‘dangerously out of control’ on many important issues including destruction of the aboriginal site at Juukan Gorge and the many worker fatalities over the years. The fact that 2019 was the first year with no fatalities after 147 years in each of which there were worker fatalities was not good.

Simon Thompson said that the company had apologised for the tragedy of Juukan Gorge and was putting in tremendous efforts to mending relationships with First Nations people around the world. The recent fatality free years were a huge achievement.

John Farmer retorted that the company had been killing people for 147 years.

3. Water around the QMM mine in Madagascar

Yvonne Orengo, Director of Andrew Lees Trust (ALT UK), said that the trust had worked for over 25 years to serve the people of Madagascar. It works closely with Publish What You Pay Madagascar and Publish What You Pay International. Publish What You Pay just published the report that Simon Thompson had mentioned. She continued, “Unfortunately a community representative from Madagascar was not able to attend today because of Covid. I am bringing a question from Tahiry Rastsiambahotra, an Antanosy man from the region where the QMM mine is situated. His question is about the transparency of Rio Tinto’s communication, which he says creates a feeling of betrayal vis-à-vis the local community and QMM in Madagascar. For example, in 2001 QMM said their weir would improve water quality in the Lake Ambavarano, but fisherfolk report a 90% loss of fish species in the lake since the weir was built – and have protested due to their lost livelihoods. In 2001 QMM said it would not exploit monazite because of its high radioactivity; now QMM exports Monazite and takes it through town. In 2017 QMM said it was compliant on the buffer zone limits, but after two years Rio Tinto admitted QMM had breached the environmental buffer zone. Rural communities take drinking water and fish in the local lakes directly affected by QMM mine process water and the contamination it brings. When will QMM communicate transparently to avoid the widespread distrust of the community?”

Yvonne added that Andrew Lees Trust and Publish What You Pay had been asking a lot of very technical questions about water quality in Madagascar and QMM had told them that there was no baseline water data. Now they had discovered that there was, but they were still waiting for it. She continued, “People were told there was no problem with QMM mine water; they are still being told that. But when pressed to disclose its discharge water data, QMM had to admit last year to exceedances in cadmium and aluminium. We concluded the QMM water management system was not working. QMM and Rio Tinto had to concede this is true. It also has high levels of uranium and lead but QMM does not like to discuss these and the absence of a regulatory limit for uranium in Madagascar means they haven’t had to – yet. Civil society was told that QMM was looking for solutions for the discharge water – and you have mentioned them today Mr Thompson – I was delivered papers yesterday and there were announcements in Madagascar press about this only last week. In fact it is a temporary solution, not a permanent solution, and it was

scoped out last year – but nobody knows anything about it. It’s a solution that can create even greater risks to the water environment and consequently to the subsistence livelihoods of rural communities living around the mine. So why have there been no transparent discussions about this treatment solution? It’s a neutralising pit solution – we’ve been asking for information for over a year. Where is the EIA and Risk Assessments? And where are the public consultations which should then accompany those and which are required for a change in the project design in Madagascar? Why does Rio Tinto allow QMM to continue to do, as the villagers put it ‘what it wants’, without transparent processes and open communications? Is Rio Tinto really willing to change its culture? Because this way of operating in Madagascar is not conducive to building trust and or to the transformational changes it is aspiring to.”

Simon Thompson acknowledged the Andrew Lees Trust’s commitment to holding Rio Tinto to account. He said the company had always been responsive to ALT UK’s requests. ALT UK had had five meetings with management over the past year and had made 17 or 18 detailed requests for information, which Rio Tinto had endeavoured to provide, and it would do its best to provide baseline data too, but if ALT UK asked at short notice for information 27 years old the company had to go back into its archives to find the data. Company Chief Executive Jakob Stausholm had offered three or four dates to meet ALT UK before the AGM but Yvonne could not make any of them. The offer remains open. The water treatment plant had been developed in response to water exceedances in cadmium and aluminium in the water that was released from the mine into the environment. The mine stopped emitting water into the environment for 18 months while the company constructed the water treatment plant, which should come on stream very shortly. There is no evidence of exceedances in uranium or lead in the waters released from the mine though he knew this had been a consistent concern of ALT UK, and that is why the company is conducting a fifth independent water quality survey. It is being conducted by an independent Australian expert in radionuclides and heavy metals. The interim report has been completed and has to go first to the national office of the environment in Madagascar. It is being peer reviewed but the draft report suggests no exceedances of uranium or lead or other heavy metals. They are within the World Health Organisation guidelines. This is the fifth study that Rio Tinto had conducted as Yvonne had consistently raised the issue with the company. It is difficult to prove a negative. Rio Tinto does not think it is polluting the environment and there is no evidence that it is, but it is difficult to prove a negative. He said he hoped that this fifth report, the most detailed and comprehensive to date, which will cover transition pathways on heavy metals will help address ALT UK’s concerns. The impacts on fish had always been known about as it had been identified in the original social and environmental assessment for the study. Monazite, which the company is extracting, is a radioactive natural product occurring in the mine and so exporting it within the strict regulations about moving radioactive material will reduce the natural background radiation in the area. He acknowledged that Rio Tinto had to step up its engagement with the local community but it had made significant progress over the past year in addressing long standing issues and now travel restrictions are being lifted he hoped ALT UK would let the company host them in visiting the mine. The company would love to show her what it is doing at the mine and would seek to address all the issues she had raised.

Yvonne replied, “We have been consistent in the things we have put forward to the Board. We have put forward significant data to support our arguments and actually I don’t think it should be difficult for you to prove what is actually for you apparently a positive – that you don’t have any impact on the environment. Up till now, over the last five years and all the questions and all the data we have put on the table showing there are problems, you haven’t been able to counter that with the opposite, and there are significant issues with the JBS&G study, as we have already laid out. There are significant issues with the laboratory results that have come back from ANDEA, the water authority, and those are all in the public domain now. We have put the critiques from our radioactivity specialist up. We would like to discuss those further. We would also like to discuss why the SEIA isn’t there and the risk assessment for this new treatment because that is a requirement of the Malagasy government, that if you change the project you must have those consultations – they haven’t happened. People are still trying to catch up with your 2014-2018 environmental plan, which they still don’t know about. So, you are still having a lot of big gaps between what you say – and I’m sorry Mr Thompson but I could pick what you said earlier to pieces, and it certainly was the President’s message not the Minister of Water that went out – I could pick it to pieces from beginning to end.” She added that there are a lot of things that have to be sorted out in Madagascar. The company spoke about the issue being inequality, but it is not. The people being referred to had seen the value of their livelihoods cut by half since the mine had begun. The mine was meant to bring people out of poverty in the region but had done the reverse.

4. Dams at QMM in Madagascar

Colm Fahy, from the International Missions office of the Jesuits in Britain, said: “Following the cyclones, there is the issue of whether the QMM dam structures and mine water management systems are fit for purpose. We note that QMM only report an excavated storage facility at QMM, not a berm, a dam or an embankment, thereby evading international dam safety criteria. We understand that following the recent events there was to be an investigation of the QMM tailings dam failure. So, when will the tailings dam failure investigation report be made public? And would it not be good practice for Rio Tinto to monitor what counts for a tailings dam according to international safety standards for such?”

Simon Thompson replied: “There is no tailings dam at QMM. The berm you refer to is an embankment made of sand which separates the mine from the external environment. The process that we use in QMM is that we create a water pond, within the mineral sands, we put a dredge on to that pond, the dredge dredges sand from one end of the pond, it goes through the dredge where the valuable mineral sands are extracted and the remaining silica sands go off the back of the dredge back in to the environment where it ultimately dries and the pond progresses through the environment and we rehabilitate that sand progressively by replanting a variety of indigenous species to restore the habitat as close as we can get it to how it was before we started mining. There are no tailings at QMM. And we take mine tailings management extremely seriously.”

Director Megan Clark added that the Rio Tinto Surface Mining Centre of Excellence tracks 165 tailings storage facilities. 119 are managed by Rio Tinto, others by Joint Venture partners. Governance includes implementation of global industry standard for tailings management which Rio Tinto had helped develop through the ICMM [International Council on Mining and Metals]. The Board looks at how implementation is going. The company has 21 tailings facilities which are ranked of high or extreme consequence and they are all on track for meeting the global industry standard by August 2023. The executives accountable for the safety of tailings facilities and minimising social and environmental impacts have a direct line to the Board. The Board has had direct conversations through the sustainability committee with the accountable executives. They take this extremely seriously.

5. A truly great company which has done fantastic things in Africa

Shareholder Jonathan Lawly said he had worked in the mining industry from 1960 and joined Anglo American in 1976 and had worked in Congo and elsewhere in Africa. He said he had been taken on by Rio Tinto in 1982 to develop the first black managers and supervisors for the mining industry as a whole for Botswana, Zimbabwe and Namibia. Rio Tinto made a difference to people because it was a people company. It had huge strengths and got on extremely well with people. As a company it needs to remind the public, the press and shareholders that this is a truly great company which has done fantastic things in Africa.

6. Risk and impact assessment processes

Councillor Doug McMurdo, Chair of the Local Authority Pension Fund Forum (LAPFF), which represents over 400 billion dollars of investment, said that the destruction of Juukan Gorge was not a ‘tragedy’ but an operational incident wholly created by Rio Tinto’s executive team and wholly avoidable. It had been very good to speak to the Chairman and his colleagues over recent years. LAPFF had issued a report the day before on mining and human rights and its impact on corporate financial performance. The company’s Fourth Objective is at the heart of what LAPFF is asking for. The area of concern is Rio Tinto’s process for carrying out environmental and social impact assessments. Mr McMurdo was encouraged by the independent investigation that Rio Tinto had taken on and the fact that Mr Stausholm had said that the company would take its 26 recommendations forward. He was also encouraged by the new independent assessment of the impacts of the legacy of the Panguna mine in Bougainville. But he would like to see this kind of assessment taking place before projects begin not just to assess legacy impacts. Would the company commit to an independent review of its risk and impact assessment process? This could help the company improve operationally and reputationally and would save costs for the Board and the company’s investors.

Simon Thompson said he had not yet read the report which LAPFF had published the day before. He would like to do so and then meet with Mr McMurdo to discuss the issues he had raised. The Panguna mine was permitted and developed in the 1960s. Standards have changed dramatically since then, and the reason the company has had to go back and conduct an analysis of the human rights and environmental impacts of that mine, which was abandoned 30 years ago, is because the standards used were entirely different from those used now and because of civil war the mine was not closed and rehabilitated according to appropriate standards. It is a very specific case but there is now a committee formed including the Autonomous Bougainville Government, representatives of landowners, Bougainville Copper Limited (the former subsidiary of Rio Tinto which owned the deposit) as well as the Government of Papua New Guinea and representatives of the Human Rights Law Centre in Australia. So there is a functioning committee with an independent Chair. An independent consultancy had just been appointed to conduct the independent review. Whenever Rio Tinto conducts a new project it has an extremely thorough Environmental and Social Impact Assessment process.

7. When will Rio Tinto leave Serbia?

Shareholder Elizabeth Denver said she had been attending Rio Tinto AGMs for about 30 years. She was not surprised at the content of the Broderick Report on the company’s work culture but was surprised that the Board was surprised. She said that her question was on behalf of the people of Serbia and all other living creatures there. “The Jadar Project has been cancelled. The people of Serbia are now wondering when are Rio Tinto planning to leave? When will Rio Tinto be selling the land back to the villagers, and will it be at the same price at which they bought it from them in the first place?”

Simon Thompson said that Rio Tinto regretted the decision of the Serbian government to cancel permits for the development of the lithium deposit at Jadar. Rio Tinto had always operated in complete conformance with the laws of Serbia and continued to honour its obligations to its employees and to the community around the site of the project. One of the unusual features of Serbian law is Serbian law is that you are not permitted to publish your Environmental and Social Impact Assessment before it has been approved by the government, and it has not been approved by the government and therefore we were unable to publish all the work that had been done on the environmental and social impacts of that project to the highest international standard, and that vacuum of information contributed to some misinformation about the project in Serbia. “We absolutely understand the concerns of the local community about the impact of the project and we feel that the environmental and social impact work that we have done will address those concerns but there may be others that will need to be addressed as part of the consultation process. … Lithium is absolutely vital for the energy transition and Project Jadar the largest lithium development project of its kind. We desperately need lithium to make the transition between internal combustion engines and electric vehicles. It is an extremely important project for Serbia as it has the potential to add 4% to their Gross Domestic Product as well as offering opportunities for Serbia to develop a downstream business that would enable them to supply green technology to the automotive industry in Europe. It is an attractive project but we completely respect the decision of the government but we are committed to reviewing all options at the right time.”

8. Worker pensions in Quebec

Jim Cook, representing retired workers from Rio Tinto’s operations in Quebec, said that in the early 1990s, the company implemented an indexation policy for its pensions. The company ended indexation in 2013 and had never explained to retirees why indexation was stopped and whether it might be reinstated. During this period, the mine provided 5.5 billion dollars of EBITDA for Rio Tinto, so affordability was not an issue. Martine Caplet, another ex-worker, said she represented a group of 700 retirees, members of a closed group, a defined benefit pension plan, that is reducing all the time. The average income of this group is around £18,000 per year. The pensions had been indexed but this was stopped by Rio Tinto in 2013. Retirees still do not understand why and are asking for reinstatement of indexation for them to cope with the increase in the cost of living. They are losing their purchasing power. She said she was happy to hear that the business is doing so well and that the company has new values. Retirees are important stakeholders of the company and are asking for consideration and reinstatement of their indexation.

Simon Thompson said that the company respects its pensioners. The company benchmarked the pension plan against other plans in Canada and it is a very generous and well managed plan, fully funded by Rio Tinto with no contributions from pensioners. Most employees also benefit from healthcare funded by Rio Tinto. It is a generous pension plan but it has never included entitlement to indexation. There had been a meeting the day before between the pensioner representatives and some of Simon Thompson’s colleagues. It was clear that the reasons for ending the voluntary indexation in 2013 had never been properly explained to pensioners. Simon Thompson apologised for that. He said that the pensioner representatives had left a number of documents with the company. These would be reviewed and a further discussion would be held in Canada in May once the company had digested the new information provided.

9. Grievance mechanisms and remediation in Madagascar

Joe Bardwell, of Publish What You Pay International, said: “You might have guessed I am asking a question about Madagascar and I think the quantity of questions we are getting today about Madagascar shows how severe the situation is there. In response to the first question we had, you framed this as an issue around inequality and that villages are begrudged because some people are doing better. But I think Yvonne highlighted that this is about villages and rural people there feeling worse off than when your mine came. They have had loss of lands, they’ve had undermined food security, lost livelihoods, health effects, and they put this down to the water in the area. Villagers say they can’t feed themselves, they can’t maintain a necessary income, they can’t enjoy their health and they can’t secure their children’s education. 63% of 368 villagers interviewed as part of that Publish What You Pay report have submitted complaints about this and they relate to the water quality, land losses, for example, and 90% of these say they have received no response from the company or the monitoring body. So, I have a couple of questions: How does the impact of the QMM mine reconcile with Rio Tinto’s sustainability, water and human rights commitments? I think a common thread today has been about righting wrongs. How do you intend to right these wrongs? When will Rio Tinto address villagers’ grievances? And what remedial measures will you put in place to compensate for the losses they have experienced?”

Simon Thompson said that there had been a number of questions on Madagascar and he had only received the Publish What You Pay report the day before and had not yet had the chance to digest it. At the appropriate time, it would be good to set up a meeting with Publish What You Pay once the company had read and analysed the report. He said that the company was taking steps to try to improve conditions for local communities. It is currently building freshwater treatment plants for them within their villages and as the company moves to a net zero mine in QMM it will be replacing fossil fuel fired power with renewables and will supply electricity to the communities as well as the 80,000 citizens in Fort Dauphin. He said that Rio Tinto needs to find ways of being more transparent and working closely with the communities. Over the last twelve months, he said, the company had made very significant progress, but there was more work to do.

10. Uranium in Australia

Andrew Whitmore asked about the Ranger uranium mine in Australia. He said, “Bearing in mind what was said earlier particularly around respect for Traditional Owners, I have two short, linked questions with respect to Rio Tinto’s 86.3% controlling interest in ERA, particularly about recent announcements on cost and schedule overruns with rehabilitation of the Ranger uranium mine within the world heritage-listed Kakadu national park with an estimated blowout of over A$1 billion.

“So firstly, given this massive shortfall, can you assure us today that the company will maintain its commitment to the Mirarr Traditional Owners to ensure that the complete rehabilitation of the Ranger uranium mine is fully funded so that no radionuclides from Ranger will enter the surrounding environment for 10,000 years as is required by Australian law?

“And secondly, in ERA’s recent annual statements, repeated mention is made of the controversial Jabiluka deposit, an undeveloped property of significant potential, either through ‘successful development’ or sale. Are you prepared today to unequivocally reaffirm our company’s commitment to support the Mirarr’s wish that the Jabiluka never be mined and instead be incorporated into Kakadu National Park?”

Simon Thompson replied, “We need to be clear that ERA is a listed company; it has shareholders other than Rio Tinto, but Rio Tinto is by far the largest shareholder, and I can therefore speak on behalf of Rio Tinto; I cannot speak on behalf of ERA as they clearly have a separate Board and separate governance.

“We are evaluating the revised forecast for the closure of ERA and we remain as a company absolutely committed to making sure that ERA is appropriately rehabilitated. We’ve given that undertaking before and we are absolutely sticking with that. We have to make sure that we have appropriate governance structures around that rehabilitation to ensure that it is done correctly and to our standard, notwithstanding the fact that we are not the owners of the mine.

“And so far as Jabiluka is concerned, I personally have met with the Mirarr people and reiterated our commitment that we will not develop Jabiluka without the agreement of the Mirarr people and I think Ben you are probably the most recent visitor to ERA and I think you had a very similar conversation with the Traditional Owners.”

Director Ben Wyatt added that the Mirarr people are “very keen for Rio to stay engaged of course in the project as a shareholder. And it’s very, very clear in respect of Jabiluka it will only ever be exploited whether it’s by ERA or others with the consent of the Mirarr people. And I’ve got to say I don’t get any sense that that consent is forthcoming any time soon.”

[Andrew Whitmore comments: “The renewed commitments on both points are welcome, although yet to be fully tested. However, a point that was not directly answered was the Mirrar wish for Jabiluka to be returned to the Kakadu National Park. If the company is serious about the Mirrar’s wishes then they should ensure this happens.]

11. The ELYSIS aluminium production process

Shareholder Philip Clark asked about the ELYSIS aluminium production process. Jakob Stausholm replied that it was a fantastic process. It was a new manufacturing process to produce aluminium. It releases the oxygen from alumina and produces aluminium without the oxygen combining with carbon to form carbon dioxide. The company had to be able to afford it, to find out how to do it in the cheapest way possible. It would take a number of years to get there.

12. Revoking licences in Serbia

Shareholder Robert Muriel asked how Serbia could revoke licences? Was it only a result of community pressure?

Simon Thompson said that the company respected the decision of the government, it understands the concerns of local communities but remains convinced it can be developed in an environmentally and socially conscious way.

13. Practical problems at Oak Flat, Arizona

Henry Munoz, Chairman of the Concerned Citizens and Retired Miners’ Coalition of Superior, Arizona, USA, said he would speak about the Resolution Copper mine project.

He said he had been a miner for many years before retirement. Among other jobs, he had worked at the BHP block cave operation at San Manuel, Arizona, from 1987 until it closed in 1999. “The San Manuel mine was closed with 30 years of copper ore left underground,” he said.

“I come from a family of five generations of miners,” he said. “I was also a town council member for Superior Arizona for ten years, where I was born and raised. The town’s surrounding environment would be destroyed, which would eliminate the ability of Superior’s economy to benefit from tourism and recreation as a result of this project.

“From my experience as a miner I know that this proposed project would fail because of the depth, underground conditions, lack of water and other external design flaws. One need only reference what is happening at your Oyu Tolgoi project in Mongolia, including design flaws and cost overruns. You cannot build a block cave mine that is 1,000 feet shallower. How do you think you can build one at 7,000 feet at Oak Flat?

“We have been having water issues which have been affecting the south western United States, especially the State of Arizona. The United States Forest Service Environmental Impact Statement, which you provided many of the studies for, and which you paid for, has concluded that the town’s aquifers would be drained and contaminated by your project.” To obtain water for the project Rio Tinto would deplete the aquifer that local residents need for survival. “Arizona’s current drought is so severe that our communities are already running out of water. Our State’s decision-makers are scrambling to find solutions to this water crisis that has already financially burdened the State’s tax-payers. We are to the point where we should decide whether precious water should go to our communities and the environment or to projects like Resolution Copper. Our Arizona State Land Department has determined that water pumping by your proposed wells for the project would cut half a billion dollars from our State’s educational system due to loss of land sale revenue. Recently the Governor of Arizona proposed setting aside one billion dollars for drought relief needs for the State. How can Rio Tinto proceed with your Resolution Copper project knowing that Arizona is in the worst drought in 1200 years?”

Simon Thompson thanked Henry for meeting with Jakob Stausholm before the meeting. He said that the world desperately needs new copper mines. There is no copper mine in world that does not face challenges. If the mine is developed (and the company has still not completed its feasibility study), if the land swap agreement goes through, the mine has the potential for delivering 25% of US copper demand at a time when the US, like everyone else, is investing heavily in renewable energy, which absolutely requires additional sources of copper. He said that Henry was right to highlight water as one of the critical risks of this project. Rio Tinto had done an enormous amount of work on water with the regulators, the US Forest Service and so on. There had been over eleven years of studies on this mine. Rio Tinto cannot finalise the design and feasibility study unless and until the land swap takes place. It is a magnificent ore body but the land the company can access from its current landholdings does not cover the whole of the ore body. There is still technical work to be done to understand the optimum mine plan and there is work to be done in consultation with all the interested and affected stakeholders including the Native American tribes, many of whom are in favour of the project but some, the San Carlos Apache in particular, who are opposed to the project. Henry had agreed to meet Jakob when he was next in Arizona and it would be good to follow up on the discussion which had started earlier on in the day.

14. Indigenous rights at Oak Flat, Arizona

Roger Featherstone, Director of the Arizona Mining Reform Coalition, said, “Resolution Copper would destroy Oak Flat, a Native American scared site that is a recreational and ecological haven. After your company blew up the sacred rock shelters at Juukan Gorge in Australia, Rio Tinto made several statements about never destroying a sacred site again. However, as you know, your Resolution Copper mine plan calls for turning Oak Flat into a crater a thousand feet deep and two miles in diameter. I do not understand how you can announce to the world that you’ll never again destroy a sacred place while at the same time move forward with a project that would do exactly that.

“In 2014 two of your senators proposed an amendment at your behest to a must-pass defence appropriations bill that requires the US Government to give you Oak Flat within sixty days of the publishing of a Final Environmental Impact Statement. You asked for and received a Special Interest Law that would allow you, a foreign private mining company, to gain ownership of a place vital to the religious freedom of Native American people.

“The Final Environmental Impact Statement was released in January 2021 but after reconsideration our government rescinded the Statement, which halted the land transfer. Now Rio Tinto are saying that you need to own this scared site in order to do a feasibility statement before you decide to move forward with the project. It is inconceivable that you would want to own a Native American holy place so that you may destroy it at all. It is worse that you want to own it before you even decide whether to move forward with a mine that will fail. It is beyond understanding that if you own Oak Flat not only would you destroy it, you would deprive Arizona communities of the environment and the water we need to live.

“In Arizona, water is more precious than copper. Your cavalier attitude toward the planned destruction of a holy place and the use of precious water for a failed experiment helps us understand why your company’s February report shows racism, sexism and bullying at some of your work locations. How you treat your employees is how you treat the world. So, how can you explain these dichotomies and when will you announce that you are abandoning the Resolution Copper project?”

Simon Thompson replied that there had been extensive consultation on this project over many years. The US Forest Service had conducted a seven year environmental and social impact assessment and consultation process. There had been over 500 individual consultations on this. There were a range of views. There was broad-based support for this project across many communities. Some organisations, including Roger’s, are opposed and the company recognises that. The point of the consultation is to seek to amend the design of the project, where possible, to accommodate concerns. The company carved out Apache Leap for this reason – because it is culturally significant for a number of the eleven Native American tribes that have overlapping claims on the area around Resolution. The company had also carved out Ga’an Canyon as it had significance to a number of tribes that have claims over the area. Many members of the San Carlos Apache are opposed and Rio Tinto will continue to see if there are ways that it can address their concerns. The company is working closely with Native American tribes. Tribal monitors are following the company’s work to ensure that any impacts on cultural impact are monitored and recorded. There are monitors from seven of the eleven tribes and these are broadly supportive of the project as long as the company does respect tribal heritage. There have been eleven years of consultation and there need to be more.

15. Exploration in Finland

I asked about the company’s exploration activities in Finland.

“Rio Tinto has launched several exploration projects in Finland. One of them, located in Rautalampi, is especially controversial and has been widely criticised by numbers of people, from members of the local community to members of the Finnish Parliament.

“Rautalampi is known for the Southern Konnevesi National Park and Rautalampi route, the largest free flowing Finnish inland waterway. It is one of the most valuable freshwater ecosystems in the whole country, consisting of lakes with excellent water quality and free-flowing rapids, inhabited by many endangered species. The area also holds significant cultural heritage value dating back to prehistoric times.

“Rio Tinto plans to continue copper and nickel exploration in the area, despite the wide opposition. The targeted exploration areas are located alongside the lakes and rivers of Rautalampi, bordering the Southern Konnevesi National Park. They also surround important groundwater areas for local water supply. In the regional land use plan, the whole area is designated for outdoor recreation, environmental tourism and nature preservation.

“This is not a suitable place to even consider mining activity. The risks are simply too high. They are too high for the environment, but also for the company, its reputation and its investors. It’s very unlikely that this project could ever develop into a mine, which is why pushing to proceed with it seems like a waste of time and money.

“Rio Tinto has repeatedly claimed that they listen and respect the local communities, but it seems that in reality they continue to act against these claims. In Rautalampi, in March 2021, the municipal council unanimously decided and announced that it will not approve of mining or exploration in the area. But instead of listening, Rio Tinto went on and applied for new exploration permits on the following day.

“Local people and the Pro-Rautalampi group have asked Rio Tinto to drop this project. It would still be easy to do so, since everything is in its early stages. The company’s response, however, has only dealt with details of how to carry on the exploration work. The question is: since it’s clear that this is not a suitable place to even consider mining, will Rio Tinto withdraw from the Rautalampi project?”

Simon Thompson replied that I was right to identify this as a very early stage exploration project for copper and nickel, two metals which are vital to the energy transition. Rio Tinto had had no activity on the ground since 2020 in Finland. It had applied for exploration licences. If the company proceeds, it will consult very widely with the local community and evaluate the social and environmental risks of exploring in that area. The company has given a commitment to be transparent and before it moves further with this project, and post-COVID, it will recommence engagement with the community to understand their concerns.

I thanked Mr Thompson and expressed the hope that the company would be willing to take No for an answer.

[One of our Finnish contacts comments: “As for the talk about engaging with communities in Rautalampi, Finland: The company has already consulted the local community and people have said no. The reasons are clear: the area is not suitable for mining and this is something that can’t be changed by minor adjustments. Mr. Thompson said that, should they decide to continue, they would again consult and engage with the locals. From the point of view of a local community member, this sounds absurd. It sounds like the company is just trying to legitimize this controversial project by using nice words such as care and respect. Trying to persuade people, or just doing what you want regardless of their concerns, is quite the opposite of respectful listening.]

16. Lack of drinkable water around the QMM mine in Madagascar

Patrick Scott asked about Madagascar. He said, “My question is another relating to Madagascar. I want to ask, can Rio Tinto explain its delay in responding to earlier requests to provide drinkable water for mine-affected communities in Mandena especially when these demands reflect the company’s sustainability, water, and other international commitments? And will Rio Tinto ensure drinkable water is available to all members of the frontline affected communities and if yes, when?”

Simon Thompson replied that the company is currently developing clean water supplies for the three communities closest to the mine and that those would be delivered in the third quarter.

Patrick replied that August was “better late than never” but pointed out that this was another four months away, “so you have to be mindful of the fact that in those remaining four months the affected communities are still not getting proper drinkable water.”

Simon Thompson replied, “Again as I mentioned earlier, I think it was the first question on Madagascar, whilst we were releasing the surplus water from the mine site into the environment during the extreme weather events, that we had in February and March, we were trucking fresh water into those communities as a precautionary measure to make sure they would not be impacted by any adverse consequences of that matter – of course we were also sampling that water every single day with community members present whilst we sampled the water, and happily there were no adverse consequences of releasing that water so far as we could determine from that sampling. August is the date we will be delivering a permanent solution rather than a temporary one.

17. Growing problems at Oyu Tolgoi, Mongolia

Richard Harkinson asked a question on behalf of Oyu Tolgoi Watch and Gobi Soil, who represent and advise nomadic pastoralists affected by the Oyu Tolgoi mine.

Rio Tinto acquired the mine in 2010. It produces copper concentrate, ships it 75 kilometres to the Chinese border and sells it into a buyers’ market there. The main attraction is the underground deposit that Rio Tinto has been seeking to develop. The company approached the International Finance Corporation (IFC) and the European Bank for Reconstruction and Development (EBRD) in 2012. That is when the original Environmental and Social Impact Assessment (ESIA) had been produced and when Richard became involved, with other NGOs.

The company has now celebrated the start of mining but NGOs are being asked to comment on the Terms of Reference (TORs) for the consultant who will produce the supplemental ESIA for the deep mining, which will use block caving. The TORs state that Oyu Tolgoi concedes that the NGOs were right that the zone of subsidence for the deep mine is 88 per cent greater than Oyu Tolgoi and Rio Tinto had said in the first place.

NGOs are concerned about the complete lack of transparency in the production of the supplemental ESIA. The consultant who is appointed will be completely wrapped up by non-disclosure agreements so he will not be able to check the veracity of his interim report with the people who contributed to it.

There is also concern also about the mode of operation. The TORs only talk about the larger zone of likely subsidence, which is as big as Ulaanbaatar [the capital of Mongolia]. But there is no reference, and the two NGOs have raised this as a concern with Oyu Tolgoi, to the fact that there will be a fourfold increase in the amount of waste produced, more tailings dams will be built, and 720 million tonnes of waste created during the 28 year projected life of the mine. Lenders (IFC and EBRD) insisted on certain levels of reporting and the last three audit reports to the lenders (the last one being in April 2020) reported extensive seepage in three places in the existing tailings dam – and there are more such dams to come. Seepage could be a cause for breakage.

The two NGOs used the IFC complaints mechanism, the Complaints Advisory Ombudsman (CAO), and there was a consultation in Mongolia mediated by the CAO leading to the creation of a tripartite committee [involving company, government and local herders around the mine] but also showing a need for more and better technical information than that contained in the 2012 ESIA. Studies were done into the nature of the mining waste being discharged into the two kilometre square tailings dams, the 70 metre high containment walls, and impacts on herder villagers below the mine. A tailings dam failure there would be significant. The cause might be overtopping but more likely ‘piping’, where seepage weakens the structure of the containment, which is what is happening now.

The NGOs want a guarantee that there will be more transparency, that the studies will not be bound by non-disclosure agreements, that the sort of consultation on the TORs and ther supplemental ESIA will respect stated international standards with independent verification.

Simon Thompson said that the principal concern of the question was around tailings. Megan Clark had spoken earlier about the rigorous processes which Rio Tinto has in place for monitoring all its tailings management facilities. These would apply equally to Mongolia. The Tripartite Council had been set up through the auspices of the IFC ombudsman to improve engagement with the herders. It was set up for the herders by the herders with representatives of Oyu Tolgoi and the Governor’s Office of Khanbogd, the town near Oyu Tolgoi.

[Oyu Tolgoi Watch comments: “This response says nothing. On the Tripartite Council they have a letter from us dated August 25, 2021, and the situation has not changed since then. Rio Tinto and Oyu Tolgoi in Ulaanbaatar are not able to control their personnel on the ground and have done nothing to change that.”]

Richard Harkinson said that it was important that the Tripartite Council was supposed to include an independent element from the CAO. But the independent element had now gone, and all we have instead is a projected consultancy, bound by non-disclosure agreements. Oyu Tolgoi is really problematic. There had been four deaths there in the last year. Oyu Tolgoi is totally untransparent. When Rio Tinto had bought into the project, it involved a Canadian company and a Netherlands letterbox company. The IMF report had criticised Rio Tinto’s lack of transparency on its ownership of this project. Richard congratulated Rio Tinto on reaching a position where things may be more transparent, by paying the Mongolia Government so it would take benefits from the mine, whereas before it was to pay off its equity before it ever started gaining, and that would have taken 37 years. Rio Tinto could now no longer hide behind Canadian company Turquoise Hill. Richard congratulated Jakob Stausholm for trying to make better transparency possible. But there had to be an independent element in the creation of the ESIA of the mine extension. The company must be transparent.

Jakob Stausholm replied that it is a complex situation and Oyu Tolgoi is a very big mine. It is a terrific development. He said he did not claim that he understood everything about it. He had visited Mongolia several times over the last few months and planned to spend a week there in July so that he could meet the local herders. He was grateful to Richard for raising the issues. He said he was definitely committed to transparency and to dealing with the issues that Richard had raised.

[Oyu Tolgoi Watch comments that they want to be informed of the dates of proposed meetings with local herders and to make sure that Jakob Stausholm really meets affected herders and not only people supportive of the company.]

Richard said he would send his points to Mr Stausholm in writing after the AGM.

18. Cyber security, Chile and the life of mines

A shareholder asked if anyone on the Rio Tinto Board was responsible for cyber security for its new aluminium development. She was worried that the Chinese or the Russians might steal the intellectual property. She was also worried about the situation in Chile. Would the new government’s excess charges affect Rio Tinto and are there funds to cover it? And finally, what is the current projected life of Rio Tinto’s larger mines?

Jakob Stausholm said that the company’s intellectual property was protected as it had good cyber security in place. The world’s leading experts were testing its network all the time. He said that the Escondida mine in Chile is the largest copper mine in the world. Rio Tinto has a good share of it, and it is operated very well by majority shareholder BHP. He said he was confident that the company would continue to have a good business in Chile. There are always challenges, and some views had been expressed, but he remained cautiously optimistic that this mine would remain a jewel for both Rio Tinto and BHP for many years to come.

Simon Thompson added that in the company publishes its reserves and resources in its annual reports. These give a rough indication of mine life. It costs money to drill and convert resources into reserves so you do not do it far ahead of time. You have a rolling programme of upgrading resources to mineable reserves. So, the life of a mine cannot be determined absolutely very far in advance. But Rio Tinto does have extremely high quality, long-life assets, particularly in its iron ore division.

19. Carbon emissions

Richard Harkinson asked about Resolution 17 in the AGM’s order of business, concerning carbon. Many people agreed that the company was moving in the right direction and making good progress. He said that he had gathered from talking with people in Australia is there is a request for Rio Tinto to report on its Scope 3 emissions (which constitute 95% of the company’s emissions) more often than every three years. The Board should know more often than every three years, and perhaps the information could be shared with investors more often than every three years – perhaps every year? Richard also asked for a statement on breaking with trade bodies. He congratulated the company for breaking with the Western Australia Chamber of Commerce after Juukan Gorge. Aboriginal Peoples must have remedies. Rio Tinto had rejected the industry position opposing remedies and calling for business as usual without care for Aboriginal rights and protection of cultural heritage. The Western Australia government legislated in support of the industry position and Richard congratulated Rio Tinto for breaking with that. A work in progress over the next two years will be negotiating an equitable way of protecting Aboriginal cultural heritage.

Simon Thompson said that it is difficult to set quantifiable targets for Scope 3 emissions as these are the emissions of the company’s customers. They could be, for instance, a state-owned Chinese steel mill, and the speed at which they reduce their emissions will rely on government targets and the application of new technology. The Rio Tinto Board thinks that every three years is the right regularity for an advisory vote on the company’s climate action plan. It will report each year on progress towards its 2030 targets for Scope 1 and Scope 2 emissions. If there were a radical change in strategy the Board would consider bringing it back to shareholders. The company fully supports Western Australian regulations for respect for Aboriginal heritage, but this is a legal minimum and Rio Tinto is committed to going further than that in consultation with Aboriginal landowners.

The day after the meeting, The Guardian reported that investors had voted against Rio Tinto’s financial statements in a protest against the company’s failure to disclose key information about how it would transition to a zero-carbon economy.