Press Release Archive - 2008

The review was jointly commissioned by the shareholders and management in August 2007. The final report from the review published in its entirety today, comprises an independent assessment of Cerrejón's past and present social engagement practices together with a number of recommendations. Cerrejón's management team is currently developing a comprehensive response to the report, including a detailed action plan to address the report's recommendations.

The independent review panel was chaired by Dr John Harker, President of Cape Breton University in Canada and included Nick Killick of conflict prevention NGO, International Alert; Salomón Kalmanovitz, Dean of Economics and Business Administration at Jorge Tadeo Lozano University in Colombia and Elena Serrano of the Chilean NGO, Casa de la Paz Foundation. The Panel were supported in their fieldwork and research by Social Capital Group of Peru and undertook extensive engagement with local communities as well as international stakeholders.

The Panel consulted a wide range of stakeholders and produced a balanced set of recommendations. Cerrejón's management will now produce a comprehensive response to the report as well as an action plan to address these findings by the end of March 2008. Management intends that the response and action plan will be made available to stakeholders shortly after completion.

The report highlights a number of areas of good practice by Cerrejón including:

• the operation's contribution to the local and national economy;
• its commitment to contributing to the sustainable development of local communities;
• its extensive human rights training programme for employees, contractors, police and army representatives; and
• its objective of raising performance standards in the mining sector.

The report also identifies areas in which the mine could enhance its social practices, including recommendations to:

• strengthen the presence and capacities of civil society groups in the region;
• improve revenue transparency;
• facilitate reconciliation between the disparate groups formed by the former inhabitants of the village of Tabaco and address the current situation of all former residents through a consultative, participatory process;
• consider more broadly the impact of resettlement on neighbouring communities such as Tamaquito and Media Luna;
• increase the access of Wayuu indigenous peoples to economic opportunities created by the mine; and
• Change aspects of the way in which it administers social investment.

Anglo American, BHP Billiton and Xstrata Coal made the following joint statement in response to the report: “As shareholders in Cerrejón, each of our companies welcomes the generally favourable observations made by the Panel. Its recommendations for areas of improvement provide a robust and credible platform from which Cerrejón can address legacy issues and continue to improve its social engagement practices, in line with its vision to be a 'company of exemplary ethical behaviour, respectful of human rights and that contributes to the welfare and development of the communities where it operates'.”

“Cerrejón's management team and its shareholders are committed to carrying forward the Panel's recommendations with vigour and we look forward to the publication of Cerrejón's detailed response and action plan at the end of this month. It is particularly pleasing that the Independent Review Panel and Social Capital Group have consulted a very broad range of stakeholders through this process. We fully support the Panel's recommendation that all interested parties should now work constructively together to address the outstanding issues identified by the report.”

Access the Independent Panel Report at:
www.cerrejoncoal.com

www.angloamerican.co.uk, www.bhpbilliton.com, www.xstrata.com

Cerrejón Profile
Cerrejón is the largest open pit coal-export mine in the world. It is owned, in three equal parts, by subsidiaries of BHP Billiton plc, Anglo American plc, and Xstrata plc. The mining operation includes exploration, production, transportation, and shipment of the high-grade thermal coal of the Cerrejón deposits. These deposits are located in Colombia's La Guajira Department in the northernmost part of South America.

Economic contributions: In 2007, Cerrejón produced 30 million tons of coal. It is the second-largest foreign-exchange producer in Colombia, and ranks first among private-sector exporters. Exports in 2007 were worth US$1,500 million a growth of 21 per cent over 2006.

The wealth generated by Cerrejón benefits economic and social development in the form of 10,400 jobs, both in direct employment (5,343), and indirectly through contractors (5,091). In 2007, Cerrejón paid more than US$180 million in taxes to the nation. In La Guajira, Cerrejón's operations represent over 50 per cent of the Department's Gross Domestic Product.

Royalty payments in 2007 were close to US$130 million. Since Cerrejón was established, royalty payments have totalled US$870 million. Eighty-four per cent of these royalties have remained in La Guajira and have been used to implement both social and economic-development projects.

Cerrejón and the environment: Cerrejón is an integrated operation (mine, railroad and port). Today's cutting-edge technologies are used to extract, process, and transport Cerrejón coal, thereby guaranteeing an environmentally-friendly operation.

Cerrejón's integrated operation was certified in compliance with the ISO 14001 Standard in 2003. Since it began operations, it has invested more than US$130 million in environmental-management programmes.

With 18 stations installed, it has the most complete air-quality monitoring network in Colombia, and uses only 30 per cent of the aquifer (underground layer yielding groundwater for wells and springs) concessions granted by the environmental authority.

Cerrejón's Employees: Seventy of every 100 Cerrejón employees are from La Guajira, and 27 of every 100 are from other parts of the Atlantic Coast. Its youngest worker is over 20 years-old. The Workers' Union is fully active with almost 80 per cent (some 3,000) of the work force as members, and a further 600 as associates.

Human Rights: Cerrejón has made a commitment to the human rights of its employees. The Company ensures that they are respected, promoted, and protected in its operations, and that they are also respected by its contractors, related third-parties, clients, and the public in general.

Social Responsibility: The Company invested more than US$5 million in 2007 in social-responsibility activities in La Guajira. Its programmes are centred particularly on education, health, basic infrastructure, culture, recreation, and job creation. In 2007 alone, over 300,000 people benefited from these programmes.

Cerrejón Foundations System: In order to guarantee the implementation of its social responsibility programmes, Cerrejón has created a system of foundations to promote and support sustainable-development projects in La Guajira. Among them are the Guajira Development Foundation, the Guajira Water Foundation, the Guajira Indigenous Communities Development Foundation, and the Guajira Institutional Strengthening Foundation.