KUALA LUMPUR: The prospect of earning up to a whopping RM66 million a month is what’s driving the uncontrolled mining of bauxite in Kuantan, Pahang.
An insider, who handles transportation of the material and who agreed to talk to the New Straits Times Special Probes team, said the colossal profits raked in, month after month, was the main reason it was difficult to regulate the activity.
“It’s the millions of ringgit that flows into their accounts that drives everyone crazy with greed,” said Ramli (not his real name).
Ramli is part of the groups raking in millions from the mining of bauxite, while the local communities suffer from the massive choking dust clouds and other contaminants in the air.
He added that while illegal operators could rake in up to RM66 million a month, his company averaged about RM18 million a month from exporting the mineral ore overseas.
“We buy the bauxite at RM9 per tonne before selling it at RM15 per tonne. The semi-processed mineral will be exported to China, India or the Netherlands from US$25 to US$35 (RM95.47 to RM133.66) per tonne, depending on the grade.
“We would get a net profit of about RM6 million for every shipment or for around 45,000 tonnes of bauxite that is exported overseas. Every month, my company will try to produce three shipments. But some of the illegal operators will push up to 11 shipments per month.”
The operators’ outlay, he said, included RM158 for the transportation permit, RM25 per month for the Land and Mines Department permit and RM60 per tonne for the shipping process.
Indonesia’s ban on the export of raw ore last year had opened the door for Malaysia to emerge as China’s top supplier of bauxite before being overtaken by Australia in May.
According to the United States Geological Survey, global bauxite reserves as of January this year were 28.1 billion tonnes (Bnt) with Guinea having the largest reserves at 7.4Bnt, followed by Australia at 6.5Bnt.
Data from the Minerals and Geoscience Department showed that bauxite production in Malaysia had jumped from 208,770 tonnes in 2013 to 962,799 tonnes last year.
Ramli, however, insisted that the problem was caused by stubborn illegal operators, who refused to adhere to regulations set by the authorities.
“There are 106 bauxite-mining companies in the state. Each and every one of us played our part in this tragedy (pointing to the water in Pantai Kampung Selamat, which had turned red from bauxite contamination). This (the contamination) was the result of miners failing to take part in our monthly gatherings. Out of the 106 bauxite-mining companies, only 20 or fewer will join the meeting every month.
“The meetings are important as a platform to discuss, together with the state Department of Environment and the land office, issues raised by the residents and corrective measures that can be taken to reduce the environmental impact of the mining to the public.”
Ramli said irresponsible settlers, who mined bauxite on their land without conducting proper laboratory analysis to determine the types and levels of silica in the bauxite, also contributed to the pollution.
“Some of the villagers and settlers have chosen to mine their land on their own without conducting any analysis on the levels of silica in the bauxite. High levels of silica can cause problems during the digestion.
“During our monthly briefings with the bauxite operators, we would provide comprehensive information on the types of bauxite that we can mine and areas that we should avoid.”
Ramli said the Kuantan Port management had prepared three ponds to trap water mixed with bauxite sediment to stop it from overflowing into other sources.
“There are three ponds in the port and we will only release water from the third pond after the sediment settles down at the bottom of the pond.
“However, contamination will still happen during rainy days as the water will wash not only the dust, but also from the stockpile into the river, which will be channelled into the sea.”