Steel giant ArcelorMittal is facing a multi-million dollar fine as Kazakh officials intensify demands for modernization in the wake of yet more fatalities at the steel giant’s local subsidiary.
The November 3 mine explosion that left five miners dead in the city of Shakhtinsk has once again called into question safety and environmental compliance at the company’s operations – and it couldn’t have come at a worse time.
Officials including President Kassym-Jomart Tokayev have been giving ArcelorMittal Kazakhstan a tongue-lashing ahead of an election where the only candidate that matters is styling himself an opponent of “oligarchical capitalism.”
On November 7, Tokayev leveled fresh criticism at the company
noting that it had racked up over 100 deaths since 2006
“Notwithstanding multiple warnings and addresses from the state organs
the situation isn’t getting any better,” Tokayev raged during a trip to the western region of Mangystau.
Some sort of response is in the works.
This week, Environment Minister Serikkali Brekeshev paid a visit to the town of Temirtau
and told residents that the company will be fined something in the region of 6 billion tenge (close to $13 million) pending the decision of a court after “gross violations of environmental legislation were revealed” in an inspection by authorities.
The violations included “an excess of maximum permissible emissions
inefficient operation of treatment facilities
It was not clear whether the inspection Brekeshev mentioned on November 16 had targeted the company’s mines
He suggested ArcelorMittal Kazakhstan’s operations could be suspended
ArcelorMittal Kazakhstan no longer seems to enjoy the privileges it held under former president Nursultan Nazarbayev
whose career began at the same steelworks that it acquired in the 1990s.
It was Nazarbayev that persuaded the multinational – now the world’s largest steel producer – to make the investment.
A fine of the size alluded to by Brekeshev would be the largest levied on ArcelorMittal Kazakhstan to date
with many previous infringements triggering only token punishments
account for around 8 percent of Kazakhstan’s total
and nearly all of that burden originates from the steelworks.
Brekeshev said during his visit that the company was expected to reduce this pollution by up to 60 percent in the coming years.
ArcelorMittal founder Lakshmi Mittal met with Tokayev in Astana in September and pledged to invest over a billion dollars in modernizing the steelworks.
a Temirtau activist renowned for his opposition to ArcelorMittal
told Eurasianet that investments at the steelworks are indeed underway. But Gusev argued that this is largely due to the group’s problems in Europe
where energy costs have soared on the back of sanctions against Russia over the war in Ukraine
requiring the company to bolster its operations elsewhere.
Gusev’s theory may be supported by ArcelorMittal’s financial results for the third quarter of 2022
which show a 6.2 percent fall in revenue and a 79 percent fall in net income year-on-year.
Artyem Sochnev is a writer based in Stepnogorsk
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Standing in the vast windswept plains of the Kazakh steppe, miner Vladimir Khaniev stoically recalled the explosion that left him permanently disabled.
"I heard a bang and the blast threw me off my feet and I lost consciousness," he told AFP.
Over the past 15 years, more than 100 workers have lost their lives in mines in Kazakhstan owned by ArcelorMittal, a Western steel giant controlled by India's Mittal family.
Khaniev, who worked for 17 years at the company's Lenin mine in the town of Shakhtinsk, was left unconscious after an explosion tore through a shaft 800 metres (over 2,500 feet) underground last November, killing five of his colleagues.
"On the surface, I look like a healthy guy," Khaniev said, "but my head hurts all the time. I'm short of breath. I'm always tired. I don't sleep much."
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another five more people were killed at the mine
sparking a debate about the exploitation of workers in a country scarred by communism and authoritarian rule since the collapse of Soviet Union
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Khaniev now suffers from encephalopathy after inhaling methane gas released by the explosion.
"In this company, we are treated like slaves, and this is the consequence: people are dying and will continue to die," said the 40-year-old, whose father and grandfather were miners.
Faced with the harrowing toll, President Kassym-Jomart Tokayev has threatened to ban ArcelorMittal from operating in Kazakhstan.
But in a country teeming with natural resources and where the mining sector accounts for up to 17 percent of GDP, few expect that will happen.
"These fatal accidents are happening because of the greed of the company's managers," Khaniev said.
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"There has been insufficient investment in new equipment and safety regulations, and there is a shortage of staff."
ArcelorMittal Temirtau, the company's Kazakh subsidiary, declined an AFP request for an interview, while local officials refused to talk about the mines.
Although an investigation established Khaniev's employer was "100 percent" at fault for the fatal accident, those responsible have still not been brought to justice.
Among the five employees killed was Denis Inkin, an experienced driller.
"My son was burnt alive. I never saw him again, he was buried in a closed coffin," his mother Galina Inkina told AFP.
On her living room table stands a portrait of her son and a candle, which she lights every morning in his memory.
"They're getting richer and we're losing our children," she said through tears.
For the past 10 months, Inkina has been fighting for those responsible to be convicted, otherwise "everything will go on as before", she said.
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"I feel that our government has failed in its duty to monitor the company," Inkina added, calling on President Tokayev to "show concern for miners".
Not far from her home, a mural on a typical Soviet-era building reads: "The miners are the economic and political pillar of the country."
The Kazakh president's statements about the value of work are plastered all over billboards.
In 2023, almost 1,000 violations of industrial safety rules were recorded in ArcelorMittal's mines.
"We're used to death here," said Andrey Lukin, a safety inspector for the Korgau miners' union.
Standing in a park where ArcelorMittal had erected a monument "to the eternal glory of miners' work", he told AFP that the miners "were not in favour of ArcelorMittal leaving".
When Kazakhstan became independent, Shakhtinsk suffered a similar fate to many other industrial towns in the former USSR, facing economic depression and a declining population.
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which paid wages higher than the regional average ($600)
heating and electricity were in short supply
"The miners want ArcelorMittalto invest in safety and recruitment,"Lukin said
lamenting what he said was a "lack of specialists
due to a drastic drop in the level of education"
He also demanded stricter regulation: "If we don't change the laws and have stricter government control
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