SITUATION ANALYSIS OF THE SMALL-SCALE GOLD ... - WWF

Most workers are paid a percentage of the gold that is recovered during a regular mining
cycle. Some title holders bring their workers in, take care of lodging and meal
arrangements, provide health care, and oblige miners to buy at the company store.
Environmental management can be improved with this system. For example, central
processing of concentrate without mercury has been put into effect in the Sara Creek
mine of Wylab.
The level of control and security in an owner-operated zone must be high. Valuable
capital assets in situ that are financed by the owner must be guarded with great scrutiny to
avoid theft of expensive parts, fuel and other mining supplies. Reliable foremen are
needed to manage and operate mining units and to ensure that equipment specifications
are not exceeded and proper maintenance is observed. The owner must have a good
control system in place to ensure that recovered gold is accurately declared and an
appropriate percentage of the production is paid to the miners. The risks are high, and as
a result this type of operation is difficult to sustain in remote mining zones where the
owner cannot be present or have reliable representation on a continuous basis.
The concession leasing enterprise. Under this type of entrepreneurship the concession
holder leases part of the concession to sub-contractors or independent unit owners. The
unit owners usually pay a 10% fee to the concession holder. The concession holder may
also collect fees from store owners, fuel transport enterprises, restaurant and brothel
owners. Security guards of the concession management enterprise will collect the gold
from miners when the sluice box is opened, pay them their share, and maintain statistics
of production by the various units on the property. The enterprise will principally invest
in zone infrastructure, facilities and systems to monitor and control the sub-letters or subcontractors
and offer security and other facilities to unit owners and miners.
These zones are characterized by a high to medium level of organization. The concession
region of Naana Resources on the Lawa River is an example of a well organized subletting
scheme where the concession holder not only provides general security, but also
maintains an elaborate miners‟ registration system and production statistics. The
company pays taxes to the government and provides a quarterly production royalty to the
local indigenous community. Security is much better than at the uncontrolled zones and
persons who do not abide by the elaborate system of rules are evicted. In other cases,
mining teams working under a sub-letting scheme have few obligations to the concession
holder other than paying their concession fees and staying away from criminal activities.
It is easy to confuse the owner operated and the concession sub-letting systems, because
in both cases miners are paid a percentage of the recovered gold. It should also be pointed
out, moreover, that combinations of both systems are possible in a single mining
concession. It is also important to realize that many sub-letting schemes arose out of
necessity rather than choice. As the demographic data indicates, three quarters of the
miners are migrants with gold mining experience who do not have concessions. In the
remote locations of the interior it is very difficult and costly to keep migrant miners out
of a concession.
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