LSE-listed Petra Diamonds has reached a settlement in relation to alleged human rights breaches at its Williamson mine in Tanzania.
The case was heard in London by Leigh Day, a UK based law firm, on behalf of 71 anonymous claimants, in relation to alleged breaches of human rights associated with third-party security operations at the mine. The mine is operated by Williamson Diamonds Limited (WDL), which is 25% owned by the government of Tanzania and 75% owned by Petra.
The agreed total settlement figure is £4.3 million, which includes the sum to be distributed to the claimants by Leigh Day, a contribution to the claimants’ legal expenses, and significant funds that Petra has committed to invest in programmes dedicated to providing long-term sustainable support to the communities living around the Mine.
The agreement also includes a framework pursuant to which an additional payment will be made by Petra in respect of up to 25 additional potential claimants who have come forward during the final stages of the settlement negotiations.
Following its investigation, Petra has acknowledged that past incidents have taken place that regrettably resulted in the loss of life, injury and the mistreatment of illegal diggers, within mining area. The incidents in question involved WDL’s third- party security provider Zenith Security as well as the Tanzanian Police Force. During the investigation, no evidence emerged that WDL personnel were directly involved in these actions.
Decision made in the interest of all stakeholders
While Petra Diamonds is not directly involved in operations at the mine and had no direct involvement in the events, it believes that the agreed settlement balances the interests of its stakeholders with those of the local community and avoids contesting protracted and expensive litigation where, even if Petra prevailed, it is unlikely that its own legal costs would have been recoverable.
Petra is also establishing a new and independent Operational Grievance Mechanism (OGM). It will be managed by an independent panel and operate according to the highest international standards, as set out in the United Nations Guiding Principles on Business and Human Rights. It will consider any incidents of potential human rights violations and provide remedy as necessary. The establishment of an OGM is in keeping with the Petra Diamond’s support for the local community and the provision of fair remedy.
The commitment to invest significant funds in community projects is intended to provide long-term sustainable benefits to local communities through income generating projects, including; a feasibility study into a formalised artisanal mining project at the mine, an agri-business project, a programme which provides medical support to the community, and arrangements pursuant to which local residents will be permitted to access certain parts of the mine to collect firewood and/or graze animals. In doing so, Petra will work with specialist external consultants and local NGOs to ensure that these programmes are designed and implemented in a collaborative and beneficial way.
Commenting on the news, Peter Hill, non-executive chairman of Petra Diamonds Limited said,“The company, board and management are deeply concerned and saddened by the allegations, which relate to the treatment of illegal diggers and others on or around the Williamson mine site in Tanzania, by third-party security providers.
“The board regrets the loss of life, injury and mistreatment that appears to have taken place around the mine. The agreement reached with the claimants, combined with the other actions put in place, are aimed at providing redress and preventing the possibility of future incidents.”