Ministry survey reveals poor standards among mining companies

An evaluation carried out by the Ministry of Energy and Mines has revealed that many mining companies operating in Laos are failing to comply with Lao laws and concession agreements, as well as being poorly managed.

Mining projects like this operation in Savannakhet are a major source of income for the development of Laos.

The ministry’s survey indicated that most companies are not carrying out their operations in line with the terms and conditions they signed up to with the government and have requested numerous extensions of their projects when deadlines and goals were not met.
It was also found that many companies are not operating professionally, do not employ the relevant technical staff, and have insufficient funding.
A typical ploy is for one company to act as a broker, reserving a plot of land which is then sold to other investors. In some instances, one company is authorised to operate several projects, which results in operations not being completed by set deadlines.
Some companies fail to comply with the specifications spelled out by the Geology and Minerals Department because they lack qualified technicians, equipment and funding, while land disputes also arise and there is a lack of cooperation with local communities.
In addition, many companies have failed to pay concession fees and other financial obligations as agreed to. This has been attributed to a lack of responsibility on the part of the relevant government departments, with debt notifications being delayed, while many companies are suffering financial instability and regularly make late payments.
In terms of coordination, it is common for companies not to inform local authorities about the progress of their field operations. They often have no local representative office, meaning that communication is problematic and operations are not closely supervised.
Since 2013, the Department of Geology and Minerals has carried out seven assessments and sent reports to the Ministry of Planning and Investment in an attempt to force companies to comply with the agreements they signed, but many issues have not yet been resolved.
As of December 2023, the central government had authorised 151 companies to carry out 166 projects concerning mineral exploration and feasibility studies. These projects covered 7 million hectares (7,000 square kilometres), equal to 29.32 percent of the country’s total land area.
In 2023, the Department of Geology and Minerals carried out assessments of the operations of 143 companies based on seven factors. These comprised compliance with laws and concession agreements, technical operations, financial obligations, hiring of local workers and safety practices, cooperation and coordination, social responsibility, and environmental protection, treatment and rehabilitation.         
Companies were evaluated according to six grades, A+ (best), A (excellent), B+ (good), B (middle), C (poor), and C+ (unacceptable).    
No companies were given an A+ or A grade; 29 companies operating 31 projects received a B+ grade (accounting for 19.21 percent of the total); 44 companies operating 47 projects were given a B grade (29.14 percent); 52 companies operating 57 projects were given a C+ grade (34.43 percent); and 18 companies operating 23 projects received a C grade ranking (11.92 percent).

By Times Reporters
 (Latest Update March 21, 2024)