Sludge on the Shannon: Inside Ireland's Alumina Industry
A ten-minute drive east of the Shannonside town of Foynes lies Europe's largest aluminium plant, Aughinish Alumina. Sprawled over the Aughinish peninsula, the plant employs a workforce of over 450 strong, and has garnered a reputation for its abuse of state support, as well as a below par environmental record. Exemplifying this, visitors to the foundry are greeted by a vast 50,000 tonne, 450 acre “lake” of red sludge, with a noticeable metallic tint in the air.
Owned by the controversial Russian mining titan Rusal, the plant has been in the public gaze recently for labour disputes, as well as a wider geopolitical rift which it found itself front and centre of, with American sanctions almost shutting it down in 2018. In a country devoid of any real manufacturing base, Aughinish is regarded as a lone gem by a political class who frantically rushed to guarantee its survival, and who have given the plant considerable leniency on tax and planning affairs.
View of the Aughinish site, with red bauxite lakes visible
Producing 1,990,000 tonnes of alumina per annum using the Bayer process, wherein alumina is generated from bauxite rock under conditions of great heat and pressure, the facility benefits from its proximity to the Atlantic, optimising imports from the Americas and Africa. Despite boasting a nature reserve, local disquiet is palpable with many calling into question the recent roll out of rock blasting technology, green-lit by Limerick County Council, as well as a litany of other environmental issues.
While lauded as an economic success story, Aughinish in its history and working practices underlines the shallowness of the Republic’s comprador economy and dependency on foreign direct investment. Praised today as a minor economic miracle for a rural community, Aughinish in the near future could very likely be a post-industrial wasteland, with immeasurable damage done to a pristine Irish waterway,
Report on the unveiling of the Aughinish plant in 1983
Comprador Economics: The Genesis of the Irish Aluminum Industry
The name Aughinish is derived from the Irish term Each Inis, “Horse Island”, with the area now existing as a peninsula on account of man-made activity. At the time the largest private investment into Ireland, operations commenced in 1983. Initially under the ownership of the Candaian mining firm Alcoa. Aughinish changed hands to Rusal in 2006 following the partial acquisition of the conglomerate Glencore.
Since 1983 the foundry has generated a slew of complaints, from local farmers with allegations of livestock poisoning to reports of water quality in the area being imperiled.
A 1997 EPA report on the plant found evidence of ‘extensive groundwater pollution’, with an unusual amount of cancer cases in the plant’s vicinity being linked to industrial practices by some. Since the late 1980s local farmers have observed birth deformities in cattle and horses bred near the plant, with local pressure groups reporting a human cancer rate of three times the national average in the near vicinity of the site.
Particular controversy arose in 1998 when blood and urine samples taken as part of an inquiry into pollution at the site went missing, despite being received and tested by authorities. With some making claims of a cover-up, any hope of an independent inquiry into the misplacement was scotched by then Minister for Health, Micheál Martin.
Refusal by Micheál Martin to launch an inquiry into the missing pathology samples
Another perennial grievance against Aughinish is the lake of red sludge, made up of bauxite residue cordoned away from the Shannon by means of a sea wall with repairs conducted in 2019. In recent planning disputes over the use of rock blasting it was brought to the attention of Limerick County Council that this would entail using explosives metres from where the sea wall is located.
Reported locations of the worst animal health problems and their proximity to main industries
In 2017 the energy consumption of the plant was estimated to be 40 megawatts, making it one of the country’s largest emitters of carbon dioxide. With the proliferation of power intensive data centres around Ireland, and electrical outages becoming a possibility this winter, there is a growing need to reassess the purpose of energy consumption by certain large corporations.
According to public records, Rusal, through its subsidiary company Aughinish Alumina, is also a prolific government lobbyer, eager to ensure a constant stream of state support. In 2018 it was found that Rusal was lobbying the Irish State to exclude itself from energy levies that would see the company lose out on the estimated €13.7 million per year in energy subsidies.
While the Dublin government can gloat of 450 pay packets circulating around the local economy, Rusal’s tax receipt portrays an all too typical situation within Irish commerce. Alongside energy subsidies, Aughinish is also in receipt of generous tax breaks with the State being ordered to retrieve €10 million in tax over sweetheart deals on excise duty which violated EU competition law. Rather embarrassingly, the Irish State lost in its appeal case against the EU decision that would allow it to collect unpaid tax revenue.
Between the years 2007 to 2011, the company paid a total of €1,952 on €191 million worth of revenue, with millions in grants being paid by the IDA to the company.
Rusal founder Oleg Deripaska at the World Economic Forum
Like most of Russian corporations Rusal has its genesis in the intemperate world of organised crime and the post-Soviet chaos of the 1990s. Founded by oligarch Oleg Deripaska, Rusal was impounded by American sanctions during the majority of the Trump administration, owing to its owners alleged involvement with the rigging of the 2016 American Presidential elections.
Famed for his connections to the world of politics, Derispaska is a man known to wine and dine with Rothschilds and liberal leaders alike. A known Putin ally, Depispaka was alleged to have helped interfere in the 2016 American Presidential election, resulting in heavy sanctions against Rusal and all its appendages.
The resulting financial downturn drastically affected the company, and called into question the future viability of Aughinish. For this reason, the Irish government was frantic in efforts to prevent the closure of the facility with officials dispatched to negotiate with Washington. As part of a deal with the US Treasury to avoid US sanctions, Deripaska, along with several other prominent board members, had to step down from Rusal, and he also had to reduce his majority stake in its parent company En+. While sanctions were rolled back in 2019, the brief political storm in a teacup almost put an end to Rusal’s business interests in Limerick.
Aughinish’s False Economy
Suffice it to say, constructing a lump of your industrial base around mafia affiliated foreign companies playing fast and loose with one of your national waterways is a fool’s errand. The relationship Rusal has both with the land and people of Limerick is entirely transactional, utterly dependent on the daily price of a commodity.
What is classed as a strategic asset today could very well be left to rot in the event of a further schism with Moscow. The pandemic itself has led to a tanking of Aughinish’s profits, with the likelihood of a protracted slump on the horizon should the global economy tank.
Paralleling the humiliation felt at the flogging of hydrocarbons off the Irish coast to alien investors at bargain basement rates, Aughinish typifies the lapdog economics practiced by our elites. Granted, the opportunity for significant inward investment in a peripheral region is enough to make any local TD jump, albeit with little concern paid to the long-term effects on the local population and biosphere.
In material terms what Ireland gains from the plant under present tax arrangements is minimal, on the environmental side what we stand to lose could be monumental. As evidenced by the overly generous tax arrangements and a peculiar resistance against regulatory enforcement, Rusal appears to be given carte blanche by the Irish State to operate how it sees fit.
Failure to build a viable national economy leaves various Irish administrations under the feet of transient investors, with Aughinish personifying all the rump elements of our exhausted economic model. Perhaps when the furnaces go quiet at Aughinish and locals are left to deal with the resulting environmental fallout, our State will begin to contemplate life outside of being a handmaiden of international capital.
A public relations campaign by Aughinish Alumina