"What is Illegal Mining"

By Philippe Dozolme

Updated August 04, 2016

One of the main criteria used to define illegal mining is the absence of land rights, mining license, exploration or mineral transportation permit or of any document that could legitimize the on-going operations.

Illegal mining can be operated on the surface or underground.

Mineral Resources Are State Property

It is illegal because, in most countries, underground mineral resources belong to the state.

Mineral resources can therefore only be operated by a licensed operator along the laws and regulations set by the local government.

Does Artisanal, Small-Scale and Illegal Mining Mean the Same?

Definitely not. Artisanal mining can not be considered stricto sensu as a synonymous for illegal mining. 

Legal small-scale artisanal mining exists in many countries alongside large-scale mining. As defined by the Government of South Africa, "Artisanal mining means small-scale mining involving the extraction of minerals with the simplest of tools, on a subsistence level".

Nevertheless, most illegal mining is characterized by the small size of its operations. Large-scale illegal mining operation is a very unusual phenomenon and is more likely linked to a non-authorized or non-documented extension of the granted land rights.

How Large and Significant is the Illegal Mining Phenomenon in Terms of Production?

Most illegal mining takes place in low-grade areas or abandoned mining sites.

Low productivity and limited production are therefore the illegal mining main characteristics.

Nevertheless, the size of the country and the frequency of the phenomenon can turn these micro-productions into a visible portion of the national production. Coal specialists estimate that 70 to 80 million tons of coal are produced in India annually in addition to the official production figure of about 350 million tonnes.

As reported by the Diamond Development Initiative, "more than a million African artisanal diamond diggers and their families live and work in absolute poverty, outside the formal economy, in countries struggling to recover from the ravages of war". There are consequently more people involved in the informal diamond exploitation than there are in the formal sector.

How Blood Diamonds Relate to Illegal Mining?

By nature, all Blood Diamonds come from illegal mining activities as they are mined by forceful labor and traded illegally. 

Criminals smuggle illicit diamonds for many illegal activities including drug trafficking, financing terrorism and money laundering.

The United Nations (UN) defines conflict diamonds as "diamonds that originate from areas controlled by forces or factions opposed to legitimate and internationally recognized governments, and are used to fund military action in opposition to those governments, or in contravention of the decisions of the Security Council." These diamonds are sometimes referred to as "blood diamonds" or "converted diamonds".

The World Diamond Council estimated that conflict diamonds represented approximately 4% of 1999 world's diamond production. Today, this organization believes that more than 99% of diamonds are now from conflict free sources and traded under the UN-mandated Kimberley Process.

Source:www.thebalance.com › Investing › U.S. Economy › Hot Topics in the U.S. Economy