‘Landlordism’ rampant in mining industry

Sep 20, 2015 News

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– powerful miners grab up hundreds of thousands of acres, evidence of little monitoring

As the new government continues to battle smuggling, safety breaches and a number of irregularities, it appears that yet another challenge has emerged in the gold mining sector.
A significant portion of the mining lands has fallen into the hands of a few powerful businessmen, raising concerns over the extent of what is known as “landlordism”.
Insiders within the regulatory body, Guyana Geology and Mines Commission (GGMC), as well as from the sector, are now insisting that the practice of landlordism is widespread despite what is being said.
A key report by GGMC earlier this year warned that reforms are needed to allow a level playing field for Guyanese as availability of mining lands continue to dwindle.
According to the list of persons benefitting from large plots of mining lands are Chinese logging companies and even a serving Consul General stationed in the US.

Landlordism is the practice where holders of mining or prospecting licences rent their land to smaller miners in return for percentage of proceeds from the activities.
By regulations, the practice is supposed to be frowned on. The issue has been raised time and again but played down by miners and even the previous Government with few persons willing to talk about it.
The situation, going on for years, is said to be highly organized with a few large miners even selling grocery, spares, fuel and other things in return for a percentage (average 10 percent) of what is found by their tenants. These supplies, including barrels of fuel, are sold at exorbitant prices, placing even more pressure on the small miners who are forced to operate in slave-like conditions.
Special rangers are employed by the businessmen to monitor the camps of small miners- which include Brazilians and Venezuelans- to check their wash-downs to ensure the correct declaration.
Many of these landlords, despite the vast lands they hold, are just minimally involved in mining but collect the percentage of gold from their tenants and then declare it to the Guyana Gold Board as coming from their legitimate dredging operations.
Many of the small miners who operate as tenants reportedly have little protection against their landlords, many of whom have rangers and security personnel who are heavily armed.
Ejected
There have been reports of miners being removed from areas where they spent time and money to prospect, only to be told they are in the wrong area. Shortly after being removed, the landlord miner would move in with his equipment to cash in on the gold lying in the ground.

Earlier this year, a GGMC-commissioned Management and Systems Review Inception Report spoke of the situation, noting the practice where persons were holding on to mining lands for extended periods.
There is little monitoring in these “landlorded” areas resulting in gold being sold to illegal buyers and even being smuggled out.
Some medium scale miners were even allowed hundreds of Prospecting Permits Medium Scale (PPMS) and Mining Permits (MP) at a time. One of them had more than 700 PPMS between him and family members (over 800,000 acres).
PPMS are only supposed to be used for exploration purposes and precede the granting of the MPs which allow for full operations. How one set of businessmen was allowed to grab control of the lands would speak volumes of GGMC’s monitoring of the industry.
The GGMC report, prepared by Dr. Grantley Walrond, L. J. L. Heesterman and J. Goolsarran, noted that given the high interest in the mining sector, there are very little prime areas available for prospective applicants.
“In addition, the majority of properties are held by few persons, who hold prospective miners to ransom. The current laws do not allow a cap on aggregate land ownership, but does allow properties to be challenged. However, challenging a property claim is onerous and time consuming, and may not be worth the effort, while consuming significant regulatory time and resources.”
The report noted that if there is a cap on individual ownership of a specific title type, a mechanism to “upgrade” and amalgamate titles to a higher class would allow an individual to “move up the title scale”.
It would significantly reduce the tendency to “landlordism”, which has taken over the mining industry.
Excess Lands
The GGMC report was also highly critical about the state of ownership of Prospecting Permits (Medium Scale) and Mining Permits (Medium Scale). These could only be described as “scandalous”. “Note that a Mining Permit Medium Scale has size of up to 1200 acres. Yet in this format, there are persons holding in excess of 500 Prospecting Permits Medium Scale and 100 Mining Permits Medium Scale.”
The industry, the country’s biggest foreign currency earner up to two years ago, has fallen on hard times with world prices hovering at a four-year low.
The result was a drastic drop in declarations last year, which wiped out a significant amount of revenue for Guyana.
Miners have been agitating for a slash in the fuel tax of 45 percent to help revive the sector. They want the fuel taxes to be reduced to 10 percent – the same level enjoyed by foreign miners.
Thousands of workers have been sent home and with banks and suppliers moving in to seize equipment and assets.
President David Granger and his administration have warned of tougher measures to ensure higher declarations and reduce mining accidents.
The Guyana Gold and Diamond Miners Association (GGDMA) earlier this year had denied that its members were involved in landlordism.
The mining body, instead, demanded the Government to release more lands for mining.

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