Fortescue Metals Group has ruled out a royalty deal with Indigenous land owners for its Solomon iron ore project, CEO Neville Power says.
“It’s not going to happen because we know it’s not going to do any good (for the community)," he told AAP.
This comes after former chief executive of Fortescue, Andrew ‘Twiggy’ Forrest commented on the immense social problems that face the local Roeburne community.
Speaking to Four Corners, he said cash payments are akin to mining welfare and will not help the town of Roebourne which he says is currently in a state of “social breakdown.”
"We know what that does to communities and the heart of Fortescue, my own heart just can’t be part of that," he told the program.
"It’s easier to do it, but we won’t do it.
“If you want to join me on one evening after 11 o’clock at night and walk down the streets of Roebourne and have little girls come up to you and offer themselves for any type of service for the cost of a cigarette, then you know you’ve come to the end of the line.
"I’m not going to encourage with our cash that kind of behaviour."
Currently the Yindjibarndi Aboriginal Corporation (YAC), which represents the local Indigenous people, is opposed to Fortescue’s offer of $10 million per year, split amongst infrastructure, education and employment programs, and $4 million in cash.
The YAC say they prefer a deal similar to those Rio Tinto has made with other traditional land owners of .5% in uncapped royalties.
However, the Wirlu-Murra Yindjibarndi people support Fortescue’s existing offer.
Power said royalty deals are not an option.
“We’ve done everything we could possibly do to try to reach an agreement and in fact, we have reached an agreement with the majority of the Yindjibarndi to that deal."
He went on to say the YAC is “trying to exercise power over the whole deal”.
But the Yindjibarndi Aboriginal Corporation says it will not change its stance on the issue, and is still demanding minimum 2.5 per cent of the royalties from the region.
"We’ve suffered for so long and the only way to get out of poverty, the only way to fix up some of our social problems, is to insist that these companies pay a fair deal," YAC chief executive Michael Woodley said.
Woodley went on to voice his disappointment in Power, hoping he would take a different tack from Forrest.
The apple doesn’t fall far from the tree," Woodley told AAP.
"The challenge for this guy is to see how he can unite the community back together again, first and foremost, and then promote togetherness so the community can sit back around at the table with FMG and work through a win-win situation."