Madneuli and Quartzite Exempted from Environmental Responsibilities?
12 July, 2012
Madneuli  and  Quartzite  Exempted from Environmental Responsibilities?

JSC Madneuli and Quartzite LLC, engaged in gold and copper extraction/exploration in Georgia will enjoy the Ecocide Law indulgence for environmental faults in exchange of  GEL 13 million. 


On May 14, 2012, JSC Madneuli and Quartzite LLC, owned by the Russian-based Capital Group signed a contract with the Ministry of Energy and Natural Resources of Georgia on exempting the said companies from all responsibilities for possible damage to the environment for GEL 13 million within the licensed period that expires in

April of 2014. Madneuli and Quartzite are licensed to implement exploration/extraction of gold, copper, silver and other precious metals deposits in Bolnisi and Dmanisi, Shida Kartli region.

Georgian environmental watchdogs fear this is the harbinger that the Ecocide Law promoted by the green activists is put into operation.

So called Ecocide Law was given as a nickname to the amendment of the law on environment protection, approved on March 20, 2012, which provided amnesty to the companies with a past record of environmental transgressions in exchange for payments to Georgia’s state budget.

The amendment embarrassed Georgian green watch-dogs so much that about 55 NGOs appealed to international community to stop their financing to Georgia’s environmental related projects for this was a money-squander against the backdrop of such a blasphemous law ignoring environmental danger. They hailed authority the amendment will open a real Pandora box of irretrievable impacts on the environment and now the box seems already open by Capital Group.

Capital Group has just entered Georgia as it took  Madneuli and Quartzite off the hands of another Russian company GeoProMining [owning companies starting 2005] in June of 2012 and to guarantee its environment-headache-free activity turned out the first volunteer to be amnestied. It pays GEL 13 million to the state based on monthly payment schedule till April of 2014. The agreement will be void only if the investor exceeds the fixed payment timetables by 10 days.

“Capital Group offered this sum on a volunteer basis in order to start everything from a clean sheet,” Nino Enukidze, Deputy Minister of Energy and Natural Resources said in the interview with Georgian Journal.

Georgian green activists find scarcely possible for Capital Group to start everything from a clean sheet for it is a legal assignee to GeoProMining and fully responsible for all those impacts the latter  inflicted to Bolnisi during his office-term: heavily polluted water, air, soil and health-afflicted local people.

According to Giorgi Gachechiladze, Head of Green Movement Party, consistence of toxins like copper, zinc and cadmium in river Mashavera [in Bolnisi] by 2.5 to 17 times exceeds the admitted level. The Kazreti irrigation channel that waters agriculture lands in Bolnisi [famous by its best vegetable farming] all these heavy metals exceed the limit from 1.2 to 40 times while product harvested here reaches markets including the capital.  Consistence of questioned substances in the drinking water exceeds the admitted level by 33-times.

“Medical researches show that the level of cancer diseases doubled in Georgia during the past decade while this level four-folded in Bolnisi,” Gachehiladze told Georgian Journal. He requires revocation of the contract and ecocide law likewise.

Enukidze has never heard of any officially acknowledged impact inflicted to Bolnisi and believes all reported misdeeds were just rumors. Nevertheless she admits that Capital Group assumes responsibility to retrieve the mistakes of GeoProMining and compensate the already inflicted loss. As to GEL 13 million it is paid above those compensations.

“If you stop business there until all loss-related calculations are completed the loss will be much bigger to the region for the entire region depends on that mining business in fact.”

Rezo Getiashvili, Project Coordinator at Caucasus Environmental NGO Network (CENN), doubts relevance of accruing the money targeted at environmental losses in the state budget.

“Money paid for environmental impact should be directly spent on compensation of this impact through penalties for example and not in the state budget where nobody can trail them down.”

He also reminds of official rap sheets on GeoProMining reported by state structures that Enukidze could not recollect.

“According to the daily self-monitoring of Madneuli in 2010, the consistence of heavy metals exceeded the admitted level in the Rv. Mashavera only once during the entire year while based on the state monitoring [of National Environment Agency] the metal concentration in most cases exceeded the legal norms from 10 to 30 times,” he said.

To make sure whether or not GEL 13 million is a relevant sum Nino Chkhobadze, the ex-environmental minister and now head of non-governmental Green Movement-Friends of the Earth, suggests an in-depth research of air, water, soil and health in Madneuli adjacent territory to calculate real compensation figure for Madneuli has not put any of due assessments in the obligatory Assessment of Impact on Environment (AIE) based on which the environment ministry gave a permission to the company in 2009. This permission includes detailed description of environment-related obligations requiring close monitoring and restriction of mining impact on the environment so as to keep toxin emission within non-hazardous norms.

Gachechiladze believes the underway contract giving a carte blanche to the investors [“it exempts of any responsibilities”] automatically revokes this permission for both are equal law enactments and the contract as the fresher paper weighs down the scale in its favor.

Enukidze downplays the risks posed by green watchdogs.

“The agreement and its legal aftermaths will be elaborated and regulated by law on the environment protection and other legislations active in Georgia the contract stipulates,” she said.  “And any issue that is not defined in the contract will be defined in pursuance with Georgian law.”

Getiashvili presumes that if the permission remains in force and all issues will be in line with Georgian active regulation in this case the state just extorted GEL 13 million from Capital Group for the contract cannot guarantee exemption from extra compensation in the face of other legislation.

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