Crossroads Asia | Economy | Central Asia
After years of safety problems, ArcelorMittal confirms its in talks to transfer ownership to Kazakhstan. But a change of ownership won’t necessarily make mining any safer.
Tokayev speaking to families and citizens in Temirtau, Karaganda region.
Credit: Akorda.kz
When a fire broke out at the Kostenco coal mine in Kazakhstan’s Karaganda region on October 28, 252 people were underground. Although 206 were safely evacuated to the surface, 46 miners died in the mine.
Kazakh President Kassym-Jomart Tokayev did not mince words, calling ArcelorMittal – the international mining giant and parent company of ArcelorMittal Temirtau, which operates the Kostenco mine – “the worst in our history in terms of cooperation between the government and [a private] enterprise.”
After expressing his condolences to the families of the miners killed, Tokayev declared October 29 a Day of National Mourning and “gave instructions to terminate investment cooperation with ArcelorMittal Temirtau.”
Although the incident prompted Tokayev’s strident remarks, the government and the company were already in talks to split. In a press release, ArcelorMittal confirmed that “the two parties have been in discussions concerning the future of ArcelorMittal Temirtau and recently signed a preliminary agreement for a transaction that will transfer ownership to the Republic of Kazakhstan.”
ArcelorMittal Temirtau is the largest producer in Kazakhstan’s steel and mining sector. Its steel plant in Temirtau – commissioned in 1960 and acquired by ArcelorMittal in 1995 amid the post-Soviet privatization boom – has an annual capacity of 4 million tons of crude steel. The company also operates eight coal mines in Karaganda region and four iron ore mines in Central and Northern Kazakhstan.
Four miners died in a fire at a different ArcelorMittal Temirtau mine in August. At the time, Kazakh Prime Minister Alikhan Smaiylov laid blame squarely at the feet of the mine’s owners, saying, “This is primarily the fault of the owners of the company. Their complete ignorance of the company’s activities has been leading to tragic events for several years.”
During an August 19 meeting about the fire at the Kazakhstanskaya mine, Smaiylov claimed that “every second death in the ArcelorMittal international group… occurs precisely in the Kazakhstan division.” He said that more than 100 people had died at ArcelorMittal Temirtau facilities in the last 15 years alone.
Nationalization may not be the salve Kazakhstan seeks. Aging mining infrastructure will be a difficult, and expensive, hurdle to surmount. And violations of safety standards at the mines, or other facilities, will not necessarily vanish with a change of ownership. That said, however, nationalization will tie responsibility for future accidents to Astana rather than a distant Luxembourg-based multinational conglomerate owned by an Indian billionaire.
As with the wildfires earlier this year, Tokayev moved swiftly to place himself at the site of the disaster and be seen taking action, including speaking directly to families affected.
At least 15 people, mostly emergency workers and firefighters, died battling blazes in the northeastern Abai region in June 2023. The wife of one of the men who died complained to RFE/RL’s Kazakh Service that there were never any spare parts for the forestry department’s vehicles; her husband took his private car to fight the fire. “It seems like all the vehicles are constantly broken down, and they have nothing to fix them with,” she said.
Such comments, and Tokayev’s immediate dismissal of the Emergency Situations minister at the time, prompted discussion of corruption, but did not clearly yield any deep introspection about the nexus between government, corruption, and safety.
Nationalization may move ArcelorMittal Temirtau’s mine and facilities into government control, but it will not immediately improve them. That will take serious effort, and money, on Kazakhstan’s part.