Andrew Forrest’s Fortescue Metals Group says it had no choice but to withhold royalties to a Pilbara Indigenous group after traditional owners declined to sign land access deeds.
Chief executive Elizabeth Gaines has confirmed Fortescue is yet to pay $1.9 million in royalties that were due to the Wintawari Guruma Aboriginal Corporation earlier this year.
Ms Gaines on Tuesday fronted a parliamentary inquiry examining the destruction of the ancient Juukan Gorge site by rival mining giant Rio Tinto.
Quizzed about the royalty dispute, Ms Gaines said the two parties were subject to a land access agreement which had the primary purpose of granting tenure, but did not indicate or give approval to future mining activity.
“The only avenue available to us is to withhold the compensation whilst we work through this proactively,” she said.
“This is the first time in all of Fortescue’s history that we’ve done this. We have seven other native title land use agreements, we haven’t taken this action in the past.
“We are working to facilitate the payment of those native title compensation payments as quickly as we can. We’ve asked them to meet with us and we’re waiting to hear from them.”
WGAC director Joselyn Hicks last month told the Northern Australia Committee traditional owners had been seeking more information about Fortescue’s plans, adding that the area in question contained numerous sacred sites.
“We know that if FMG is granted their mining leases then we have no power to stop them destroying our sites and causing damage to the places we care about,” she said.
Fortescue in December submitted a Section 18 application to destroy Eastern Guruma sites in order to expand its Solomon iron ore operations.
WA’s Aboriginal Cultural Materials Committee in February resolved to defer considering the application and recommended Fortescue undertake further consultation.
Documents tabled to the inquiry reveal Fortescue ‘s lawyers wrote to the committee in April, threatening legal action if the application was not progressed.
WGAC said it reflected behaviour that was “bullying, dismissive, disrespectful, and inconsistent with their published values and the expected behaviours of an ASX Top Ten Company”.
Ms Gaines said the letter from external legal firm Green Legal did not reflect the company’s views or track record on native title partnerships.
Fortescue in June asked the WA government to pause considering the Section 18 application while it consulted further with the committee.
The company said it had requested the process be resumed in September and WGAC had provided a letter of non-objection.
Ms Gaines said Fortescue developed its mining plans to avoid and protect culturally significant places in consultation with traditional owners.
The company currently holds 121 approved Section 18 applications to destroy sites. Another five are pending.
It wrote to Pilbara native title groups in July promising to notify them in writing prior to disrupting any sites subject to Section 18 approvals and to ensure no new information had been uncovered since the applications were approved.
The inquiry is set to provide an interim report by December 9.