Case study

Russia: Nornickel violates Indigenous rights for the sake of profits

Picture: Clipclose

Norilsk, Russia: A large amount of harmful emissions significantly impairs the environment. Norilsk, Russia: A large amount of harmful emissions significantly impairs the environment.

Commodity company MMC Norilsk Nornickel mines metals on Indigenous lands. Including metals that are needed for the energy transition. Yet the consequences for the environment and local Indigenous communities are devastating: in addition to an environmental disaster, the commodity company is also responsible for contaminating soil, air and rivers – as well as for causing food shortages for local people. As Nornickel shows itself to be only outwardly interested in cooperation, there is a continued need to apply pressure on the group and actors involved, some of whom are in Switzerland.

In May 2020, the Taimyr peninsula in Russia was the scene of one of the Arctic’s worst environmental disasters: in the Siberian city of Norilsk, 21,000 tons of diesel oil was negligently leaked into the wild from a damaged tank belonging to a subsidiary of Russian nickel producer Nornickel. Indigenous land and two rivers were seriously contaminated. The area north of the incident area is inhabited by the Dolgan, Nenets and Nganasan communities, for whom the disaster has had serious consequences: their reindeer left the area, and the toxic material killed not only the fish but also the insects that the fish fed on. As a result, since the incident, hunters often come back to their villages empty-handed. Consequently, they also have less meat and fish to sell, meaning their incomes are reduced, and so the affected communities have been less able to buy food of other kinds.

On May 29th, 2020, the Taimyr peninsula in Russia was the scene of one of the Arctic’s worst environmental disasters.

Profits at the expense of the environment and Indigenous communities’ rights

The disaster makes one thing clear: the commodity company MMC Norilsk Nickel, known as Nornickel, is profiting at the expense of the environment and the communities living in it. On Taimyr peninsula, but also at other locations in Russia, the company is mining for nickel. The metal is needed for a variety of industries and consumer goods. However, within the mobility transition, nickel is also used for the manufacture and storage of renewable energies, for example in electric vehicle batteries or solar power installations. Apart from the risk of environmental disaster such as the one that occurred on Taimyr peninsula, extracting the metal also causes serious air pollution. In addition, the company disposes of toxic residues in the natural environment around the city of Norilsk.

Nornickel plans to expand its activities in Russia. Recently, a lithium mine has been planned on the Kola peninsula in the Murmansk region. Nornickel has signed a cooperation agreement with Russian state atomic energy company Rosatom in this context. The mine is to be created in Europe’s largest wilderness area, which has until now been completely free of infrastructure such as roads. The region of the planned mine is stewarded by the Indigenous Sámi, Nenets and Komi peoples. These communities fear that the area will be severely contaminated and that there will be dramatic consequences for their way of life. They are also sceptical of Nornickel’s claimed willingness to consult them.

Indigenous communities demand their rights

Since the environmental disaster of 2020, the Indigenous communities have urgently called upon Nornickel to provide support for their villages. So far, this has met with no success. As an Indigenous representative from the region, whom we cannot name for his own safety, says, “communities that are near the site of the incident called upon Nornickel to help, but they were ignored.” In public statements, Nornickel said that it was ready to cooperate and announced that it would be compensating the affected communities. Some Indigenous communities have indeed received payments. However, the only beneficiaries were Indigenous organisations and groupings that were considered to be loyal to the resource group. “Those who ask inconvenient questions about breaches of regulations and other issues are simply excluded,” says Pavel Sulyandziga, president of the independent Indigenous rights organisation, the Batani Foundation. The Nornickel company also gives merely superficial responses about other problems the mine causes local Indigenous communities: According to Pavel Sulyandziga, the group evades the central issues of land rights, resource use and compensation mechanisms. Negotiations with the company and the local government do not take place on an equal footing.

This may seem to have changed in recent years – but that is just an illusion. Nornickel boasts of applying FPIC (Free, Prior and Informed Consent) processes to involve Indigenous communities in business decision-making. However, there is no basis for any FPIC process. Freedom of opinion and expression does not exist in Russia, a situation that has been further exacerbated by the war of aggression on Ukraine, and affected communities are often denied the right to refuse planned projects: “They are confronted with them as irreversible facts,” says Pavel Sulyandziga. The same seems be true of the planned lithium mine. While Nornickel and Rosatom hope to obtain a mining licence already by December 2023, STP partner Andrei Danilov says that no more than a few of the affected communities have been contacted at all – and these only at the last minute.

Swiss companies also bear responsibility

STP joins with the affected Indigenous communities in campaigning for their rights and put pressure on international parties involved. These include Swiss actors: STP research shows that Nornickel’s funders include Swiss banks Credit Suisse, UBS and Pictet. Nornickel also has a Swiss subsidiary, Metal Trade Overseas SA, based in Zug. From Switzerland, the company markets throughout the world the raw materials it obtains in Russia and Finland.

Together with the affected communities, the STP points out to the banks the environmental and human rights violations committed by the group, and calls upon them to exert their influence on Nornickel. The STP has also supported Indigenous partners in their demands that Nornickel respect the right to Free, Prior and Informed Consent (FPIC).

Norilsk, Russia: A large amount of harmful emissions significantly impairs the environment.

Norilsk, Russia: A large amount of harmful emissions significantly impairs the environment. Photo: Clubclose

The Piassino River has been polluted since the Nornickel diesel oil spill in 2020.

The polluted Piassino River after the Nornickel diesel oil spill in 2020. Photo: provided

polluted river

The Daldykan River turned bright red due to chemical pollution from the nearby Nornickel factory. Photo: Liza Udilova

What the STP and the affected Indigenous communities are calling upon Nornickel to do:

  • Nornickel should maintain an ongoing dialogue and a relationship on an equal footing with the Indigenous communities who live near their plants and are actually or potentially affected by their business activities.
  • Nornickel should comply with international environmental standards, take measures to prevent environmental damage and adequately repair any damage that occurs. Compensation to the affected communities must be made in consultation and collaboration with the communities.
  • Nornickel should outline its Indigenous Rights Policy in compliance with the UN Declaration on the Rights of Indigenous Peoples, including an unambiguous and binding commitment to the right to Free, Prior and Informed Consent (FPIC).
  • The STP is requesting Metal Trade Overseas SA, Nornickel’s Swiss branch, as well as the Swiss banks involved with Nornickel, to put pressure on Nornickel and demand that they take appropriate measures.

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