"He invited about 20 of us" then "instead of owing 5% I ownwed 0.00086% of the mine."
Have you made explicit the share you will end up with or you just assumed that all of you would get 100% / 20 people, i.e. equal share? It sounds that your uncle worked a lot more (from the moment he looked for partners and invited them into the venture till the end of the paperwork and beginning of the operations). I concede though that your share was way too small. If the rest of the partners (18, without you and your uncle) received the same share, your uncle gave you all only a little over 0.015% which is just below any justification I can imagine.
Its a really long story. I mean long. No the uncle didn't do all the work. Infact he contributed no money at all. There was a lot of legwork done by other family members hiring equipment to do prospecting, providing transport and wooing potential investors. You have bear in mind that half of the relatives were not educated. There was a lot of trust and good will because were "family". We are still are family.
On a side note, this made me realise why there is so much conflict in some mineral rich areas in Africa. Honestly if we weren't peaceful people there could have been serious conflict.
> On a side note, this made me realise why there is so much conflict in some mineral rich areas in Africa. Honestly if we weren't peaceful people there could have been serious conflict.
It's my way of saying we were really mad! Mad enough to come to blows which nearly happened at our meetings or to sabotage the whole mining operation. Have a look at this story[1] about a community in diamond rich land in South Africa who are still bitterly divided to this day.
It turns out, there's a name for this (which I learned in a HN comment): resource curse.
One theory being that, essentially, legal controls and enforcement are expanded with economic activity. But a sudden surge in resources (e.g. discovery or exploitation) exceeds the existing system's ability to control corruption, and it's very hard to steer a cash-rich system back to good governance after this happens.
You're right that rent seeking and corruption is a big part of the resource curse but another aspect of it is that having a large amount of natural resources makes your other exports less competitive (because all the skilled people go work in the mining/oil/whatever industry) and so it's hard to develop the educational and other institutions that a successful society has. That's why developed countries (e.g. Norway, Canada, USA) don't suffer from the resource curse. They have other options than exports for economic growth (in addition to better functioning governments).
There is an argument against aid to developing countries for similar reasons.
Have you made explicit the share you will end up with or you just assumed that all of you would get 100% / 20 people, i.e. equal share? It sounds that your uncle worked a lot more (from the moment he looked for partners and invited them into the venture till the end of the paperwork and beginning of the operations). I concede though that your share was way too small. If the rest of the partners (18, without you and your uncle) received the same share, your uncle gave you all only a little over 0.015% which is just below any justification I can imagine.