In remote Western Sahara, prized phosphate drives controversial investments

Morocco's mining of the lucrative fertilizer ingredient in occupied Western Sahara has sparked charges it is violating international law – and that global customers are looking the other way.

At the end of a pier stretching more than a mile-and-a-half into the Atlantic Ocean from Laayoune, a 75,000-ton tanker vessel rocks slowly in the ocean swells, creaking and groaning as it takes on a new load. 

A long spout pours phosphate from a conveyor belt into the ship's hold, and some of the powdery substance spills into the air like dust, coating the deck of the vessel and stinging as it blows in the strong wind. By the next day, this tanker, called the Double Rejoice, will be on its way across the Atlantic to Baton Rouge, La., where its load of phosphate will be delivered to PCS Nitrogen Fertilizer, the American subsidiary of PotashCorp, the biggest fertilizer company in the world.

Farther out to sea, two more vessels wait for their turn to load.  

Phosphate is a key ingredient in the fertilizer that helps makes it possible to feed the world's growing population. The world's supply of phosphate is concentrated in just a handful of countries, with more than three-fourths of that in Morocco and Western Sahara. But exploiting Western Sahara's supply of this critical resource is controversial.

Once a Spanish colony, Western Sahara has been occupied by Morocco since 1976, and roiled by regional power politics and an independence movement that waged a guerrilla war until a cease-fire in 1991. With Morocco's sovereignty over Western Sahara unrecognized by the UN, many in the international community argue that Morocco is violating international law by exploiting the territory's resources – and that global companies should not be party to that.

Yet the phosphate mining by a Moroccan company goes on, and foreign companies like PotashCorp continue to buy. In 2008, prices for phosphate rock spiked, raising the incentive to ignore international law and continue exploiting Western Sahara's phosphate. Prices have since dropped, but have still increased by more than 300 percent since 2007. At current prices, the load in the hold of the Double Rejoice would be worth nearly $14 million.

"It's a huge ethical dilemma. And the companies – PotashCorp – simply look away from that dilemma. They choose to look away," says Erik Hagen, head of Western Sahara Resource Watch, which tracks the companies that buy resources from the disputed territory.

Why the mine draws fire

The output of the mine in Western Sahara, called Boucraa, is about 2.5 million tons per year. That's only a small percentage of the 27 million tons that Morocco, the world's largest phosphate exporter, produces every year. Yet it is draws fire because International law prohibits occupying powers from exploiting the natural resources of the territories they control unless they do so in the interest of, and according to, the wishes of the local population. Morocco says it meets these conditions because it invests heavily in Western Sahara, local and regional governmental bodies are headed by Saharawis, and representatives from the region have a say in development and resource extraction. 

The Moroccan government has spent millions of dollars developing fishing ports in Western Sahara, which has a population of about 500,000. It says it is spending millions more on development projects in Laayoune and elsewhere, including plans for urban public spaces, public transportation, the second-largest public library in Morocco-controlled territory, and Western Sahara's first university. The government has also attracted thousands of Moroccans to the territory with incentives like land, subsidized food, and lower taxes, changing the demographics of Western Sahara so that Saharawis are now believed to be a minority. 

But Saharawi activists say that Saharawis don't reap the benefits from exploitation of Western Sahara's natural resources. They complain of government neglect and discrimination against Saharawis in Western Sahara.Hospitals are so poor that many people try to go elsewhere for treatment, they say, while pointing out that there is yet no university in the territory.

Unemployment is high, and Saharawis say they are often passed over for government jobs or work in the fishing and phosphate industries, with those jobs going to immigrants from Morocco instead. And none of the benefits from mining reach the more than 100,000 Saharawis refugees, displaced by the war, who live in camps across the border in Algeria. 

"They always claim they are building infrastructure and offering jobs to mask all this plundering of resources," rights activist Brahim Dahane says of the Moroccan authorities. "This is mere propaganda. It's only a way of legitimizing their plunder of natural resources in Western Sahara." Mr. Dahane claims government harassment forced him to close down his Internet cafe business, and he is now unemployed. 

A sparse desert landscape

The source of the controversy, the Boucraa mine, is more than an hour's drive from Laayoune, the capital of Western Sahara.

The 100-kilometer (about 60-mile) conveyer belt carries phosphate from the mine to the port in Laayoune. It cuts across the sparse desert landscape, which is dotted only by small shrubs and the occasional stand of small trees that shade herds of goats. The mine extends across nearly 25,000 acres, from which rise huge piles of rock excavated from the mine.

During a rare visit by Western journalists, a dragline, a machine the size of a house, was scooping rock out of a pit to expose the phosphate. At the bottom of the 125-foot-deep trench was the vein of phosphate, only around 15-feet deep and a little over 100-feet wide. Workers used front loaders to scoop out the soft rock.

Where's the profit? 

The mine is run by PhosBoucraa, a subsidiary of the Moroccan state-owned Office Chérifien des Phosphates, or OCP. In interviews in Laayoune and at the mine, OCP officials and the head of PhosBoucraa downplayed the importance of the mine to Morocco's overall phosphate mining industry. Extraction at Boucraa costs more than at other mines, and because of this and the mine's small scale and large investments in equipment and maintenance, the mine was unprofitable for 27 years, until 2008, when phosphate prices spiked, they said.

Mr. Hagen of Western Sahara Resource Watch says this claim cannot be verified because OCP does not publish its accounts for its mining in Western Sahara separately from its Morocco operations. 

OCP kept the mine in operation when it was unprofitable to provide jobs for locals, says Mohamed Belhoussain, marketing director at OCP. In a PowerPoint presentation for journalists, officials detailed the more than $100 million they say they've spent on programs like housing help for employees and job training programs for young people, and said all the mine's profits are invested back into the region.

A government spokesman contradicted this claim, and said that while Moroccan investment in Western Sahara is high, the cash does not come specifically from Boucraa's profits. OCP has budgeted $250 million over the next 10 years for regional programs to promote health and education and reduce poverty, said officials. They also said that 55 percent of the mine's employees are Saharawi. Saharawi activists contest that claim, saying the figure is less than 30 percent.

The Moroccan government spokesman, Mustapha Al Khalfi, also touts the investments the Moroccan government has made in Western Sahara in healthcare, housing, and other fields as well as in the ports and the phosphate mine. The government strives to keep investments up in Boucraa, despite the limited profits, for the “social impact” on the region. He emphasizes the stability of Western Sahara compared with other parts of the Sahel region.

The two sides argue about who benefits from the phosphate extraction because of the implications for the legality of the mining operation. Yet at the end of the day, that is peripheral to the main fight of Saharawi activists: the right to vote on the future of Western Sahara. "What we really want is not just a university, but the right of self-determination and the respecting of international law," says activist Lahcen Dalil.

Phosphate shipped around the world

Despite the controversy, international companies continue to line up to purchase the phosphate that pours down the conveyer belt to the port. PotashCorp is the biggest customer, but phosphate is also shipped to Australia, Lithuania, Mexico, and elsewhere.

In a statement on its website, PotashCorp said it buys phosphate from the Boucraa mine because it is the only source for the particular quality of phosphate it needs to satisfy a longterm contract. It also said OCP's local development programs mean the mining benefits the Saharawi people and complies with international law. A spokesman for PotashCorp declined to answer questions about its purchase of phosphate from Western Sahara. 

Last year, the Norwegian government, which has the world's largest sovereign wealth fund, divested PotashCorp because of its purchase of Western Saharan phosphate. Several European banks have done the same. And the European Union last year ended a fishing agreement with Morocco, which included Western Sahara waters, because of concerns that it violated international law.

Other resources are still being exploited. Sand is exported to the nearby Canary Islands, owned by Spain, to bolster beaches there. Several international companies are exploring for oil in Western Sahara or off its shores. Activists say the Austin, Tex.-based company Crystal Mountain Sel Sahara is producing salt in Western Sahara. And several European companies as well as American company UPC Renewables are developing wind farms in Western Sahara, with plans to export the energy. Such investments go forward with little controversy, despite the legal gray area.

The International Women's Media Foundation funded travel to Western Sahara for this story.