Why Do people Keep Dying at Lakshmi Mittal’s Kazakhstani Enterprises?

The tragedy at the Kazakhstanskaya mine has become another dark page in ArcelorMittal Temirtau company’s book of fatal incidents in the Republic of Kazakhstan. In the last 14 months alone, 13 people have died there. Orda.kz looked into the situation.

One after Another

As sad as it may be, no one seems to be surprised with the incident at the Kazakhstanskaya mine in the Karaganda region. This mine belongs to ArcelorMittal Temirtau, a company where workers’ death has become perceived as the norm. Since June 2022, there have been five incidents that have claimed people’s lives. The previous tragedy was in January 2023. 

The Kazakh mine. Photo: Industrial Karaganda.

Reports on the fire at the Kazakhstanskaya mine were received on the morning of August 17.  A conveyor belt started burning. Most of the 227 miners managed to get out of the smoke-filled mine, but five remained underground. Their bodies were later found.

A criminal case has been opened on the fact of the fire. The reasons for what happened will be investigated. President Toqayev has already ordered a comprehensive investigation into the causes. But one of the reasons is a frank disregard for safety, which has not changed at ArcelorMittal Temirtau enterprises for years.

Cheap and Nasty

Perhaps the above heading is how one can describe the principle by which the owner of "ArcelorMittal Temirtau" Lakshmi Mittal became a billionaire. He bought up businesses that either had already declared bankruptcy or were close to it. That is how, in 1995, the enterprises of the Karaganda region – "Karmetkombinat" in Temirtau and coal mines in Karaganda ended up in Mittal's possession.

Nursultan Nazarbayev’s former son-in-law wrote in his book “Godfather-in-law” that during the transaction, a certain agreement was supposedly concluded personally between Mittal and the President of Kazakhstan on the division of property. They divided the profits in half, as well as authority. Mittal managed and sold the products. Nazarbayev, on the other hand, turned a blind eye to miners' and metallurgists’ low salaries, the fact that there was practically no modernization at the enterprises, and that safety was getting worse.

Orda.kz has received the results of a study conducted by a private company commissioned by the state. According to it, industrial safety and labor protection at AMT enterprises is one of the lowest in the CIS and the world.

The lack of modernization is indicated by the fact that CO2 emissions at AMT enterprises in 2019-2021 exceeded the same indicator at competitors by more than two times. A significant part of the equipment is also in disrepair and requires replacement.

But thanks to this approach, Mittal has cheap products that he can sell easier than competitors. For example, to China, which is the main export destination for Karaganda enterprises. However, its volumes have been greatly reduced in recent years.

But can anything be done with Mittal? It is possible, but it seems to be outside of Kazakhstan’s jurisdiction. Mr. Lakshmi ignores our laws, to put it mildly. This was demonstratively manifested in the way he ignored the memorandum of understanding signed in 2021 with the Government of the Republic of Kazakhstan. Already after it, 8,000 miners were fired from AMT enterprises, who had previously been paid a meager salary of 130-150 thousand tenge for such work.

After the tragedy at the Kazakhstanskaya mine, perhaps there will be consequences. Akorda has issued a statement.

The government should negotiate with the foreign company that owns this enterprise regarding the strict provision of personnel safety, the presidential administration said in a statement.

A foreign company, as it is not difficult to guess, means "ArcelorMittal Temirtau".

The Right Person

The old authorities’ reasoning for not trying to influence Mittal is clear. But what about the new authorities? Have they done anything to bring him to justice ? They are indeed trying.

In April of this year, the special prosecutor of Karaganda sent a request to Luxembourg. The request regarded questioning Lakshmi Mittal. The ArcelorMittal concern is legally registered in this European mini-state. However, four months have passed, and no news from Europe has been heard. Could the Luxembourg authorities have ignored the request? Yes, they could have. And they can continue to do so.

ArcelorMittal headquarters in Luxembourg. Photo: Wikipedia

ArcelorMittal is considered the No. 2 metallurgical company in the world. It accounts for about 10% of the global steel market. And taxes from this steel empire flow to the duchy.

Mittal for Luxembourg is one of the chickens laying golden eggs. And, most likely, the local authorities will not want to scare them away. This is even despite violations occurring at ArcelorMittal enterprises in other countries. They also lead to the death of people. It is a shame what has happened Karaganda miners and metallurgists.  Losing the tax from 10% of the world market is, however, apparently worse. Nothing personal, just business.

Original Author: Igor Ulitin

DISCLAIMER: This is a translated piece. The text has been modified, the content is the same. The text has also been modified to reflect the current situation as of 22/08/2023. Please refer to the original piece in Russian for accuracy.