The Commercial Law Development Program (CLDP) is a division of the U.S. Department of Commerce that helps developing and post-conflict countries through technical assistance on commercial legal issues. Many of their projects are also supported by the Bureau of Energy Resources, U.S. Department of State. One area of focus for CLDP is improving mining sector governance to catalyze investment in critical minerals. Strengthening a host country’s regulatory oversight and permitting process is one way to expand mineral production while protecting society and the environment.
CLDP advises on legal and regulatory reforms to attract responsible mineral investment in mineral extraction. They also propagate best practices between regulators and work with governments on developing investment frameworks for sustainable mining in key energy transition minerals and improving the environmental footprint of mining operations. This type of technical advice is often country-specific and tailored to unique challenges and goals of the host government.
The Law and Policy Program was honored to join one of these missions as a subject matter expert on strategies for aligning Fiji’s mineral laws and policies with their ambitious climate and environmental laws.
There is a natural tension between climate mitigation, environmental protection and mining. As the Intergovernmental Forum on Mining, Minerals, Metals, and Sustainable Development (IGF) observed, “When improperly regulated, mining activities have the potential to harm the environment and social and economic structures within a community, instead of capturing the many benefits that can flow from the sector.” On the other hand, mining can meaningfully contribute to a country’s economy.
A report prepared by the Columbia Center on Sustainable Investment described how mining can help countries achieve sustainable development goals by fostering broad-based economic development and providing minerals that are essential to technologies, infrastructure, energy and agriculture. Internationally, critical minerals are one element of a successful green energy transition and ensuring that they are responsibly and sustainably mined is crucial to success. A strong regulatory system is necessary to bridge the gap between these tensions. National frameworks and policies are important, but so is implementation of good plans and best practices. Unfortunately, this is often easier said than done.
Ambiguity in the permitting process cuts in multiple directions. Prospective mine operators may not understand what is required in order to get a permit. Ministry officials and regulators struggle to consistently apply ambiguous legal standards. And civil society does not know how to assess the validity of the process, which can erode a project’s social license. This uncertainty can propagate misunderstandings and disagreement on all sides. It can also lead to community opposition, stalled projects, and stranded assets.
The environmental impact assessment (EIA) process is increasingly recognized internationally and by industry as a tool to reduce ambiguity. As the IGF summarized in a guidance document, an EIA process that adequately analyzes all phases of the lifecycle of the mine (from exploration through post-mining transition) is a valuable tool for reducing ambiguity. A robust analysis can provide “a roadmap for managing impacts and optimizing social and economic benefits from the mining sector.” However, a weak regulatory system or procedural flaws in the EIA process often produce the following negative repercussions: “trust between mining proponents, governments, and communities can be jeopardized; mines can operate with inadequate environmental and social management plans; and mine closure plans and financial guarantees are often insufficient.”
In other words, the process of preparing an environmental impact assessment should be considered a stepping stone to success rather than a hurdle to be avoided.
Jamie Pleune is an associate professor of law (research) and a member of the Law and Policy Group in the Wallace Stegner Center.