Corruption in Sarawak linked with mining company Rio Tinto? « Mining Blog

Corruption in Sarawak linked with mining company Rio Tinto?

10. March 2012,

There’s a new entry on the From Money to Metal wikisite.
Cahya Mata Sarawak (CMS) is a private company, controlled by the family of the Sarawak state Chief Minister Abdul Taib Mahmud (“Taib”).

In late 2011, the Malaysian government anti-corruption commission annonunced an investigation into bribery by Taib and a number of companies, which had allegedly obtained fraudulent conracts to construct the notorious Bakun dam, and obtain hydro-power, specifically for alumininum smelting.

Among the latter companies are China’s huge metals and mining conglmerate,Chinalco; and Rio Tinto.

In February 2012, Sarawak Report released results of its own probe into CMS’s dealings with Rio Tinto Alcan.

The UK-Australia listed company obtained a license to construct a major smelter at Simalajau in 2007, using electricity from Bakun.

According to Sarawak Report, the previously-announced joint venture between Rio Tinto and CMS is nothing of the sort, and the Taib family controls virtually the entire enterprise.

If that proves to be true(and there is some documentary evidence to support the accusation) it may be one reason why Rio Tinto has so far stalled on implementing the deal.

According to Sarawak Report:

“[Rio Tinto Alcan] spokesmen have made plain that they have yet to move to the stage of feasibility studies and environmental and social impact assessments for this Simalaju smelter project.

“However, they can be under no illusion that in conducting prospective business with CMS they are proposing to enter into a joint venture partnership with one of the world’s most notoriously corrupted and politically exposed companies.

“Taib stands to make billions (as usual), but what is in this project for local people?

“Taib Mahmud himself is being formally investigated by his own federal government’s anti-corruption commission (MACC). So what on earth do Rio Tinto Alcan think they are doing even considering entering into such a deal with a company that is blatantly owned by Taib?”

Meanwhile, an investigation by Al Jazeera revealed that – far from being snapped up by customers – the majority of energy which might be produced from the Bakun dam hasn’t secured any major takers.

Dam engineers, interviewed by Al Jazeera, “could not explain how the massive amount of power [it] produces could be used in a sensible way”.


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