Three Eritrean refugees have filed a lawsuit against a Canadian mining firm over claims that it conspired with the Eritrean government to force them and other conscripted workers to work at the Bisha copper mine for long hours and little pay while living in squalid conditions.
The legal action followed just weeks after QKR Corporation, a mining fund backed by Qatar’s sovereign wealth fund, held discussions on a $1bn bid for Canada’s Nevsun Resources, which owns 60% the Bisha mine alongside Eritrean state-owned contractor Segen Construction.
The men, who now live in an Ethiopian refugee camp, say they were conscripted into the Eritrean army before being made to work “unfairly long hours without enough salary, proper medical services, good shelter [or] enough food”.
Eritrea’s harsh national service programme, which requires all citizens over the age of 18 to enlist in the military or work for state-run companies, was linked to the exploitation of workers in the country’s mining sector in a 2013 report by Human Rights Watch (HRW).
One of the refugees, Gize Yebeyo Araya, told his lawyers that he worked at Bisha until March 2011, and Segen paid him less than 500 nakfa ($33) a month to dispose of dangerous chemicals, including sulphur, that were generated during the mining process.
“Work consisted of laying a large plastic sheet on the ground to hold the toxic chemical waste,” he said. “The heat was extreme when working. I got serious burns from the sun. I still have the scars from some of these burns on my face. Because of these conditions, and because of how little we were fed, I was always weak and exhausted.”
The human right watch report noted that foreign mining firms eyeing Eritrea’s mineral reserves are in danger of “walking into a minefield of human rights problems”, as nearly the entire workforce is enrolled in the country’s national service programme.
Four more international mines are set to open in Eritrea over the next two years, with 17 foreign companies exploring potential sites.
Qatar’s QKR approaches Eritrean mining interest Nevsun Resources
Luckily for QKR, Nevsun remained tight-lipped about the possible approach by Qatar’s QKR, which initially saw the company’s stock leap by 25% prior to a valuation of roughly $940m.
QKR last purchased AngloGold Ashanti’s Navachab mine in Namibia for $110m in July, along its guidelines of seeking assets closely linked to production or struggling with their finance.
It predicts a production of 80,000-90,000 tonnes of copper this year and the start its first production of zinc at the site, located 150km west of Asmara, from the beginning of 2016.
Nevsun reported sales of $416.3m and a profit of $71.5m for the first nine months of 2014, producing 65,100 tonnes of copper in concentrate with a working capital of $519m, including $380m of cash and $113m in current receivables.
