Rio Tinto yet to pay compensation over sacred site destruction

A sign adorns the building where mining company Rio Tinto has their office in Perth, Western Australia, November 19, 2015. REUTERS/David Gray

MELBOURNE, Aug 27 (Reuters) - Mining giant Rio Tinto (RIO.AX) is yet to pay compensation to the Aboriginal group whose ancient rock shelters it destroyed for an iron ore mine in Western Australia last year, company officials told a parliamentary inquiry Friday.

The incident last year destroyed the historically and culturally significant site at Juukan Gorge in the Pilbara region that showed evidence of human habitation 46,000 years ago into the last Ice Age.

The destruction created public outrage that led to a dramatic overhaul of Rio's leadership and a review of the Australian laws that are supposed to protect significant sites of the world's oldest living culture.

An interim report from a federal parliamentary inquiry in December said Rio should pay restitution to the Puuti Kunti Kurrama and Pinikura people (PKKP) with the final report and recommendations due in coming months. read more

The head of Rio's Australian operations, Kellie Parker, told the inquiry on Friday the company was committed to "doing the right thing" around paying restitution but said that details around the financial component of any compensation were subject to a confidentiality agreement at the PKKP's request.

Rio Tinto has rehabilitated parts of the Juukan Gorge and is working to restore the shelters in a structurally sound way, she said.

More broadly, Rio has moved responsibility for company relationships with traditional owners and mining near significant sites to operational managers, rather than the company heritage division.

It has also committed to review mining plans around all areas of significance and "modernise" agreements with traditional owners, Parker said, without clarifying whether this could include backpayments for historic royalties.

Rio Tinto does not pay royalties to traditional owners for some mines where mining began prior to the native title act in 1993.

The world's biggest iron ore miner does not pay royalties to the Wintawari Guruma for three of six mines it operates on their ancestral land, even though those mines are operational today, said Tony Bevan, a director at the Wintawari Guruma Aboriginal Corporation.

The miner posted record half year earnings of more than $12 billion in July. read more

WGAC want royalties to be considered as part of a modern agreement as well as compensation for heritage destruction and an ability for them to visit their traditional lands for which access is currently denied.

News emerged this year that Rio failed to protect WGAC artefacts that had been salvaged from its Marandoo iron ore project including 18,000-year-old evidence showing how people lived during the last Ice Age. Those and other artefacts were thrown in a Darwin rubbish heap. read more

Parker said that Rio was modernising agreements, with particular focus on social as well as economic contributions, but did not directly answer repeated questions by Senator Patrick Dodson about the number of mines that Rio doesn't pay royalties on.

The PKKP said that it continued to work in good faith with Rio Tinto on the recovery and rehabilitation at Juukan Gorge as well as the development of a co-management model for their operations.

"The results on these will be the true test of our relationship with Rio Tinto," it said.

PKKP said it wanted a relationship-based co-management system with Rio that reflected a shared commitment and respect for its rights, and participation in decision making throughout all phases of a mine, from development to closure.

Other Top Sustainable Business stories

Europe's banks lagging on sustainability - BlackRock study

India has fewer ESG funds than other top 10 economies

Oil majors, Woodside seek to overturn planned Australian clean-up tax

Central banks should not mandate 'green' investments: Raghuram Rajan

Reporting by Melanie Burton; Editing by Sam Holmes & Simon Cameron-Moore

Our Standards: The Thomson Reuters Trust Principles.