Given Africa’s growing mining economy, risk mitigation is becoming increasingly important, as even the most risk-free country can become unstable, integrated risk mitigation solutions firm Unity Resources Group senior VP for strategic development Tim Curtis tells Mining Weekly.
The development of the resources industry in African communities can either create stability and security, or instability and insecurity, depending on whether the mining company has established itself correctly.
The challenges confronting resource sector companies in Africa include land-based insecurity resulting from the activities of rebel groups, terrorism and factional, clan-based and crimi- nally motivated groups, as well as the maritime- based insecurity of piracy, which puts supply chains at risk and can increase costs, particularly insurance costs.
Further, ungoverned spaces, which include fractured and disabled political and governance systems, as well as widespread poverty and unemployment, corruption, health and environmental challenges and food shortages, can also create security risks, he says.
Complex supply chains across challenging topography and difficult operating environments also challenge mining companies.
While much focus has fallen on security issues in northern Africa, such as in Sudan, Libya and Somalia, these issues and challenges seem to be moving south, from Saharan Africa to sub-Saharan Africa, with the deterioration of security evident in a number of regions, says Curtis.
Border instability, such as that characterising the Sudanese, Egyptian, Libyan and Chadian border regions, is creating further pressure for companies working in these regions.
Further, the shared border between Kenya and Somalia has seen Somali terrorists and clan-based groups increasingly undertaking illegal transactions in Kenya.
While piracy has predominantly been based off the coast of East Africa, it seems to be moving north into regions such as the Gulf of Aden and the Red Sea, and further west, to Mauritius and the Seychelles.
“If there is to be true progress and development, all these challenges must be eliminated. How- ever, in the interim, security risks to mining groups can be mitigated,” says Curtis.
Resource companies establishing themselves in Africa need to establish business resilience through the development of systems and procedures, and ensure recovery planning is in place. This includes safety management systems, good security and health and environmental programmes.
Should a security issue arise, the company then has systems in place to enable business recovery.
“Miners entering the African market increas- ingly require meticulous planning during the market entry stage and continuous monitoring of the safety and security environment once established,” he says.
Unity encourages companies to plan ahead and be prepared, from the point of deciding to make their African market entry to designing strategies that consider all of the challenges. They need to take a holistic view of all risk related to health and safety, the environment, security, human resources, customer liaison, community outreach, civil affairs, and logistics and supply chain management, besides others.
Threat and vulnerability assessments should be undertaken. This entails research to identify and mitigate risks and prepare for the incorpo- ration of resilient processes and procedures across the mine’s functional areas.
“Further, mining companies need to continuously monitor and evaluate these systems and procedures, as the operating environment is dynamic and requires the constant adjustment and fine-tuning of plans and procedures,” says Curtis.
Meanwhile, Unity believes that civil liaison and community outreach and development are key enablers to success. This includes the design and delivery of community-based security strategies.
Companies should develop mutual trust between the miners, community members and suppliers to gain support for the development of the resource. The mine should also promote local industry involvement through local procurement plans and providing local employment and upskilling opportunities for the community. Community members can assist the mining company with their in-depth knowledge of the local area.
“It is all part of the preparation and delivery of solutions. Understanding the security, logistics and other practical issues, such as supply and medical requirements, before the mine is established, is essential to success,” Curtis concludes.