Eurasia Insight:
KAZAKHSTAN: MINING SECTOR STRIVES TO IMPROVE SAFETY, REDUCE FATALITIES
Joanna Lillis: 8/28/07

At the entrance to a shabby mining town in Kazakhstan’s industrial heartland, a sign on a typical Soviet-era apartment building offers a proud boast: “Beloved Town Shakhtinsk.” The abundance of abandoned buildings with gaping windows would suggest otherwise – testifying to the exodus from the town in the 1990s, amid the troubles plaguing the country’s mining sector.

Shakhtinsk is still home to many miners. Nowadays, they work for Arcelor Mittal, one of the world’s biggest steel producers. At present, the company is embroiled in controversy stemming from a fatal accident at one of its mines in Kazakhstan in 2006, in which 41 miners were killed in a methane explosion.

Near a dilapidated housing project where many miners live stands the courthouse where some employees of an Arcelor Mittal subsidiary – Mittal Steel Temirtau – were convicted on 9 July of negligence in the tragedy. Eight middle managers and technical staff from the Lenin mine near Shakhtinsk received prison terms of up to three-and-a-half years for safety breaches that contributed to the blast. Some of the widows are demanding tougher sentences for an accident they say was preventable.

“Unlike other miners in other countries, our miners have absolutely no rights,” Natalya Tomilova, head of the recently-established Committee for Miners’ Families (CMF), told EurasiaNet. “If they start fighting for their rights, it means losing their jobs.”

“Many widows said that in the run-up their husbands had been complaining of the gas situation in the mine,” Tomilova added. “They were saying that gas was coming in and it was getting impossible to work.”

A Kazakhstani government commission found that failure to observe safety regulations caused the accident, which occurred during maintenance work on the ventilation system. “The explosion was due to deliberate over-riding of controls and breaking well-established safety procedures. It was not equipment-related,” an Arcelor Mittal spokesman told EurasiaNet by e-mail.

Local and international media have cited safety concerns in the eight Arcelor Mittal-owned pits around Karaganda – four hours’ drive from Kazakhstan’s booming capital, Astana – which include faulty alarm and ventilation systems, outdated machinery and uncomfortable, low-quality masks.

Arcelor Mittal – formerly Mittal Steel – says it has invested $2 billion in its Kazakhstan-based mining and steel facilities since taking them over in 1996, including over $250 million on mine safety, leading to a 70-percent reduction in injuries in the two years after the take-over.

Since 1996, it says, the situation has improved dramatically. “When we arrived, Kazakhstan's steel and mining industries were suffering from years of under-investment and were on the verge of collapse. Wages and productivity were extremely low, as were the standards of Health and Safety. Eleven years on, things look very different,” the spokesman said.

Prior to last year’s accident, the Luxembourg-based company hired the DuPont consultancy firm to improve safety at its facilities; after identifying weaknesses, it is now conducting safety training for Arcelor Mittal. The EBRD has pledged $100 million for a project to bring health and safety practices into line with international standards, including investment in gas monitoring, equipment upgrades, and prevention of coal face collapses and roof falls.

Arcelor Mittal says injuries are down 40 per cent this year at its facilities, and there have been no mining fatalities. “While we recognize that there is more work to do, it must be noted that this is the best-ever safety performance,” a company spokesperson said. Overall in Kazakhstan, 91 miners have died in mine accidents since 1996.

Vera Maslo, whose 45-year-old husband, Vladimir, died in the Lenin mine accident, is blunt about safety standards. “The miners do not have the right to their own lives,” she told EurasiaNet. However, not all miners are dissatisfied with working conditions. “It’s good work,” said Viktor, who works at a pit called Shakhtinsk, where 23 died in an explosion in 2004. Conditions are “satisfactory”, he added, and safety is “OK.” Viktor is pleased with the pay raise he received after miners downed tools following last year’s accident; nowadays he takes home about $700 per month, around double his previous earnings. Arcelor Mittal says it has increased basic salaries and – in order to improve safety – reduced individual productivity bonuses. Tomilova – whose husband died in a 1993 mining accident – is unconvinced that miners are genuinely satisfied. “The reason they say nothing is because they fear for their jobs,” she said. “[But] when a person’s patience snaps and he is on the edge, he doesn’t care… The time will come when they will speak out.”

She called on the company’s president, London-based billionaire Lakshmi Mittal, to take on a more direct role in working with miners to identify safety risks and other concerns. “Accidents like this cost a lot of money. If Lakshmi Mittal cooperated with the workers and with our committee, we could help him hugely,” Tomilova said.

As well as campaigning for improved conditions, the CMF is lobbying over the position of the families of the deceased, with whom Arcelor Mittal says it is in close contact. The company, which recorded a 2006 net income of $8.2 billion, says that it has paid out some $3.4 million to the families, above what Kazakhstani law requires. The payments included 10 years’ salary to each family and one-off payments to purchase flats, furniture and gravestones. According to the payment records, individual families were allocated $65,000-100,000; however, many say they received a fraction of the sum after tax and other deductions.

The committee says the payments do not compensate what the miners would have earned in the remainder of their working life, and argues that many families have been left with dependent children and without a bread-winner in a town with few job opportunities.

The organization is lobbying for more compensation. A legal appeal has been held up by a local court ruling that said the relatives of the deceased had missed a filing deadline. Relatives counter that the state did not provide a reasonable timeframe for an appeal. “The investor did not just turn up here,” said Tomilova. “The state allowed him to be the boss here, and if the state doesn’t make him pay, then the state should pay itself.”

Editor’s Note: Joanna Lillis is a freelance writer who specializes in Central Asia.