Critical Resource has established a senior advisory board to guide its LicenseSecure™ assessment system for natural resources projects. The board comprises:

•           Lord (John) Browne - managing director at Riverstone, the private equity firm, and former group chief executive of BP.

•           Bill Emmott - former editor of The Economist, and globally-respected commentator and consultant on international affairs

•           Professor Paul Collier – professor of economics and director of the Centre for the Study of African Economies at Oxford University, and author of The Bottom Billion.

Critical Resource is an advisory firm specialising in sustainability and stakeholder issues, with a particular focus on the natural resources industries. The firm has developed LicenseSecure, a system for assessing the “health of the socio-political license to operate” for resource projects. This aims to facilitate far-sighted, responsible management of sustainability and stakeholder issues around such projects and is designed as a decision tool for senior executives of companies and major investors. The advisory board will provide high-level guidance to the development of LicenseSecure.

Critical Resource’s  aim is to assist clients to meet their business goals by managing these issues in a strategic, far-sighted and responsible way. Critical Resource is also a source of independent analysis and comment in this area.

A particular focus of expertise is the natural resources sector, including energy and mining, where such issues are often critical to business success. The team brings together broad experience from BP, Rio Tinto, McKinsey, The Economist, the OECD, Chatham House and elsewhere.

The LicenseSecure methodology provides a summary view based on a rating from AAA to D. This is assessed using a comprehensive and carefully designed set of criteria, and backed up by a detailed assessment to guide management or investor response. 

For companies, the assessment provides authoritative due diligence and a succinct, comprehensive overview of the ‘socio-political license to operate’, allowing strategic monitoring and response to risks and opportunities facing the project. For investors, a LicenseSecure rating can help reveal price-sensitive information not covered by standard valuation models, and signals in advance where projects face socio-political threats to value or reputation.

The role of the board is to provide input to the team on major, emerging socio-political trends to inform the development of LicenseSecure™ and also refinements of the methodology. Initial guidance in this respect will be provided during 2009. Excluded from the board’s role is providing guidance on the ratings of individual projects, and overseeing the day-to-day running of Critical Resource.

During his time at BP, Lord Browne was credited with its transformation into one of the most successful global energy firms. He also adopted far-sighted, and industry-leading, approaches to climate change and other corporate responsibility issues.

Emmott is author of Rivals: How the power struggle between China, India and Japan will shape our next decade. During his editorship of The Economist, from 1993 to 2006, its circulation more than doubled to almost 1.1 million worldwide.

Professor Collier is one of the world’s leading experts on African and resource-rich economies. He was formerly Director of the Development Research Group at the World Bank.

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Mining, we all know, is an easy target for environmentalists and others who may have a very narrow view of the world and not apprecaite its importance to everyday life. We in the industry also know that the industry’s social efforts are in many cases second to none.

Anglo American’s response to the cholera epidemic in Zimbabwe (and now spreading into South Africa) caused by that inhuman meglomaniac Robert Mugabe is an excellent example of our caring industry.

The funds, to be donated from the Anglo American Chairman’s Fund, will be managed by the South African Red Cross Society (SARCS), which has long operated in these territories, and is in the process of implementing an extensive recovery plan.

Anglo’s donation will be used as part of the SARCS’ relief operation to facilitate medical treatment and to provide clothing, shelter, and food, as well as education to reduce and minimise infection.

In addition Anglo Coal’s eMalahleni Water Reclamation Plant will deliver 72 000 litres of potable water to the affected areas.
 
Kuseni Dlamini, Head of Anglo American South Africa and Chairman of the Anglo American Chairman’s Fund said: “Anglo is committed to supporting the communities in which it operates as well as to the health of its employees. We hope today’s donation to the Limpopo and Zimbabwe communities will help bring some immediate relief to the affected people.”

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Professor Ernesto Villaescusa, Industry Chair in Mining Rock Mechanics, Western Australian School of Mines, Curtin University of Technology notes that he “read with interest the article entitled Strata control” in International Mining’s May issue. He comments: “Leading photo. It raises a lot of questions… For example if this would be a typical installation practice, the position of the operator leaves a lot to be desired. In unsupported ground, on a typical development face, it means that the operator is indeed exposed to instability from above.

“The statement ‘hard rocks mines are moving from mechanical to resin anchor bolts to improve ground support efficiency’ needs qualification. In Australia, most mines rely on frictional bolts and there is documented evidence of problems with the efficient installation of resin bolts.”

In the paper by Villaescusa E, et al, . Quantifying the performance of resin anchored rock bolts in the Australian underground hard rock mining industry. Int J Rock Mech Mining Sci (2007), doi:10.1016/j.ijrmms.2007.03.004, the authors conclude: “The overcoring data show that for the majority of the current bolt–hole size combinations, reinforcement systems and installation practices used in the Australian hard rock mining industry, the best resin mixing and bolt encapsulation occurs within the middle region of the bolt. In all cases of low load transfer, poor resin mixing was identified as the main cause. In addition, the majority of the overcored bolts had no resin at the collar region, indicating that effective plating of the bolts is very important for long-term effectiveness. The worst conditions in terms of encapsulation and load transfer are found towards the toe region of the bolts.”

Villaescusa continues: “However, the biggest issue I have is with the shotcrete section of this article.

“First of all, shotcrete does not provide active support ‘within minutes’, and the fibres are not designed to secure a ‘good bond’ with the rock. Most importantly, the suggestion that ‘most mining fatalities are caused by small stones weighting less than 1 kg’ is plainly wrong. This is a dangerous statement that is clearly designed to discredit the role of wire/chain link mesh in rock support (in favour of shotcrete). Our experience and research outcomes clearly show that mesh is a critical component of a ground support strategy, specially when deformations exceeding 50 mm are likely to be experienced when the shotcrete is no longer effective.

“Furthermore, the statement that TSL can be used as ‘a replacement for wire mesh’ is also not correct or scientifically justified. Our research shows that the current TSL products have serious force-displacement deficiences.”

John Chadwick responds: “Both Mike Rispin and I were able to discuss these points with Professor Villaescusa at the recent MassMin conference in Sweden and the other contributor to the shotcrete discussion has been made aware of Villaescusa’s points.

Michael Rispin, Head of Mining, UGC International, BASF Construction Chemicals Europe: “In response to Dr. Villaescusa’s concerns regarding the article, I will first and foremost address his concern with respect to the part on TSL as contributed by BASF. He and I had the opportunity to speak about this face-to-face at MassMin and I believe that we came amicably to an equilibrium regarding the issue and attributed it primarily to interpretation and semantics.

“The passage in the article reads: ‘Largely designed to be a rapidly applied, temporary ground support or as a replacement for wire mesh in conjunction with rock reinforcement, TSLs offer …’. We stand fully behind this statement.

“The interpretation of the effectiveness of TSL or that of wire mesh is not represented by the statement and is, of course and as with other means of ground support, dependent upon local conditions, application specifics, thickness of TSL, gauge of wire mesh, etc. Notwithstanding that, the statement as published is maintained to be accurate.”

Further comment and contributions are welcomed.

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