Wasting the Nation.indd - Groundwork

Chapter 4: The toxic cradle of productionAluminiumIn 2001, the Australian corporation BHP merged with Billiton to create the world’slargest diversified minerals corporation. Billiton was previously owned by Shell whosold it to the South African group Gencor in 1994. The deal required a major export ofSouth African capital and Gencor sought and received an exemption from the capitalcontrols then in place from the Minister of Finance. Billiton was listed in London andit soon became evident that Gencor, the supposed parent, was in fact of subordinateinterest. In an internal deal, Billiton bought Gencor’s base metals assets, including theRichards Bay aluminium smelters. The deal thus preceded, and set a precedent for,the listings of other major South African corporations on the world’s central stockexchanges in the late 1990s and early 2000s.Gencor itself retained its own precious metals division but quickly unbundled,morphing into a capital holding company and selling off its last assets, a 46% holdingin Impala Platinum, before closing its doors in 2003. The hollowing out and closure ofGencor seems to have been connected with a legal claim against it by people sufferingfrom asbestosis. The corporation bought Cape Plc’s asbestos mines when the latterdisinvested from South Africa in the early 1980s. Without admitting liability, it madea “full and final” settlement of R380 million to the Asbestos Relief Trust. It was thenquickly liquidated, returning very substantial ‘shareholder value’ while terminatingcorporate responsibility for the ongoing ruin of the environment and of thousands ofpeople’s health. In the meantime, much of Gencor’s top management had transferredto Billiton.Billiton continued a major expansion of aluminium smelting capacity inauguratedby Gencor. The Hillside smelter at Richards Bay, complimenting the older Baysidesmelter, was completed in 1996 and the Mozal smelter outside Maputo in Mozambiquefollowed shortly with production starting in 2000. These smelters linked with Billiton’sexisting bauxite mines and refineries: the Worsley mine and refinery in Australia andthe mines in Suriname, in Latin America, which supplies a refinery operated by Alcoain which Billiton has a 45% interest. The refineries produce alumina, a whitish powder,from the raw bauxite ore supplied by the mines. The process uses chemicals and heatto separate alumina from the toxic residue known as ‘red mud’. Worsley appears toproduce about 12 million tonnes a year of the stuff, although BHP Billiton [2006] isnot exactly explicit on this point.Wasting the Nation - groundWork - 119 -