Singapore: The reopening of a contentious Australian gold mine in Thailand is causing controversy five years after it was ordered shut by the country’s former military government amid accusations of villagers being poisoned by leaking toxic waste.
Australia’s Kingsgate Consolidated has waged a lengthy battle against the Thai government since Prime Minister Prayut Chan-o-cha used his sweeping powers under the country’s then junta regime to close the Chatree gold mine, Thailand’s largest, 280 kilometres north of Bangkok.
The Chatree gold mine in northern Thailand was shut down in 2017.Credit:Carig Skehan
Kingsgate, whose Thai subsidiary Akara Resources had operated the mine since 2001, always maintained it was not responsible for water and land contamination in the area and filed an international arbitration lawsuit, arguing its treatment was a breach of the Thailand-Australia Free Trade Agreement (TAFTA).
The company was reportedly seeking as much as 30 billion Thai baht ($1.27 billion) in compensation from the Thai government over the shock forced closure of the mine.
But less than a fortnight before the ruling from the arbitration tribunal in Singapore was expected to be made public last month, Kingsgate said it had been awarded four 10-year leases allowing it to re-start the Chatree mine, which is on the boundary of the northern provinces of Phichit and Phetchabun.
In its quarterly report to the Australian Stock Exchange on January 30 Kingsgate said it “was pleased to confirm that … the Thai government has welcomed the company back to Thailand and agreed that the Chatree gold mine will re-open”.
Thailand’s Prime Minister Prayut Chan-o-cha closed the mine over environmental and health concerns.Credit:AP
With an announcement of an arbitration ruling continuing to be deferred, however, Kingsgate’s permission to re-open has prompted scrutiny from opposition politicians and activists about what deal had been struck by Prayut’s under-fire government to avoid the ignominy of defeat at the tribunal and a 10-figure payout. Opposition MPs had given Thailand little chance of winning the TAFTA case because Prayut had invoked a section of junta-era legislation labelled “the dictator law” to shut the mine without due process, pushing more than 1000 workers out of jobs.
The former army general, who came to power in a military coup in 2014 before winning an election in 2019, had shut the mine over health and environmental concerns.
It followed research by a district forensic scientific institute and a university that had found many locals with higher than usual traces of heavy metals in their blood. More than 300 people were later named in a class-action lawsuit brought by villagers against Kingsgate’s subsidiary Akara that is still before the courts.
“The local community living in Phichit and Phetchabun have not been compensated at all,” said Emilie Pradichit, a human rights lawyer and executive director of the Manushya Foundation, a non-government organisation.
“Many others have also had to move out because the land was no longer useable. Everybody’s very unhappy with the fact that the four licences have been granted and the fact that the arbitration [outcome] is still not public.”
But Kingsgate chairman Ross Smyth-Kirk said on Monday there had never been any substance to claims linking the mine with chemical pollution.
“There is no evidence whatsoever and that was proven in the tribunal,” he said.
“No one has ever been able to produce any evidence ever. The whole thing has been a furphy from day one and it’s very disappointing because the mine was of real benefit to the local economy. If you go up there you can see the difference it made to the locals.”
Smyth-Kirk said of Kingsgate’s permission to restart mining that there was “nothing we’ve been awarded that we wouldn’t have been awarded in any other country”.
“We’ve made it quite clear from a long way back that we put to the government that it would be in the best interests of both parties to try and negotiate,” he said. “They believe they’ll lose the case, everybody else believes they’ll lose the case.”
Thai Deputy Prime Minister Wissanu Krea-ngam said the mine was being permitted to re-open under new laws as long as the company complied with strict environmental, land management and community health provisions.
Prayut’s grip on power in Bangkok is looking increasingly shaky due to friction in the ruling coalition. The infighting came to a head in September when deputy agriculture minister Thammanat Prompow, who spent time in jail in Australia for drug trafficking in the 1990s, was sacked from the cabinet over rumours he was plotting against Prayut.
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