http://www.atimes.com/atimes/Southeast_Asia/FJ09Ae06.html
In Indonesia, all that glisters is not gold By Bill Guerin As incoming president Susilo Bambang Yudhyono prepares to step into the palace, a mercurial dispute between US-based Newmont - the world's biggest gold producer - and Indonesia's local authorities and environmental activist groups yet again highlights the difficulties of mining in the country. The case has raised concerns over how rich multinationals that extract resources such as coal, copper and gold as well as oil and natural gas conduct themselves in developing countries such as Indonesia, where mining investment has hit rock bottom after steadily declining to US$177.3 million last year from $2.6 billion in 1997. Conservation and anti-mining non-governmental organizations (NGOs) such as the Indonesian Center for Environmental Law (ICEL), Indonesian Forum for the Environment (Walhi), Indonesian Mining Advocacy Network (Jatam), and the Institute for Policy Research and Advocacy (Elsham) claim that Newmont's local operation, PT Newmont Minahasa Raya (NMR), has dumped lethal amounts of mercury and arsenic in waters more than 80 meters deep in Buyat Bay in North Sulawesi, causing the death of at least 30 villagers from Minamata disease - a severe form of mercury poisoning named after a Japanese bay where the illness was first documented in the 1950s. Epidemiological and medical researchers at the time identified the disease as heavy metal poisoning caused by eating fish and shellfish from Minamata Bay. "The waste from the mine being released into the sea amounted to a potentially 'toxic soup'," mining and environmental hydrogeologist Robert E Moran told the New York Times. In August, several villagers were flown to Jakarta for blood tests to determine possible mercury poisoning following a University of Indonesia laboratory test that confirmed four locals living near the bay had blood mercury levels between 9.5 and 23.9 grams/liter (g/L). In a separate investigation, the Jakarta Health Agency claimed that according to their tests, the four villagers actually had blood mercury levels between 33.7 and 52.5g/L. Police also took eight water samples from the bay that they said contained unusually high levels of mercury. Lawyers are now seeking damages of $548 million, and five NMR officials are in jail awaiting formal charges. Richard Ness, president director of NMR, was detained along with the others two weeks ago, but was quickly released on grounds of ill-health. Police announced on Wednesday that they have forwarded the files on Ness and the others to the state prosecutors in North Sulawesi. Ness, along with American Bill Long, Phil Turner of Australia and three Indonesians - David Sompie, Jerry Kojansow and Putra Wijayat - face charges of violating Law No 23/1997 on environmental management. The law allows for jail terms of up to 15 years if death or serious illness is proved to be the result of pollution. Under Indonesian law, police outline their cases in dossiers sent to prosecutors, who then decide whether to press charges. The US Embassy in Jakarta warned in a statement last month, "The detention of Newmont employees under these circumstances can only harm the investment climate in Indonesia." This immediately drew the wrath of the Sierra Club, an environmental group in the US, which says the Bush administration is defending a company known for leaving toxic pollution in its wake around the world, rather than a poor community seeking environmental justice. Stephen Mills, Director of Sierra Club's international program, said: "The US Embassy's actions are a dangerous example of the Bush administration's misguided foreign policy. No country or community should be pressured into accepting that its children will be poisoned in exchange for development." The US ambassador to Indonesia, Ralph Boyce, has already raised the issue with outgoing President Megawati Sukarnoputri and national police chief General Da'i Bachtiar. Lawsuits have also been filed against Energy and Mineral Resources Minister Purnomo and Environment Minister Nabiel Makarim, who have both been widely criticized for dismissing NGO claims and defending Newmont's environmental record. A case also has been filed against Health Minister Achmad Sujudi. The company has questioned the differences between the police forensic lab tests and internationally certified lab results. Experts confirm there is a very wide variation in "normal" baseline mercury blood levels. Though the House of Representatives Commission VIII for mining and energy concluded in August that the police findings were reliable and further studies were unnecessary, the government then set up a joint investigative team made up of representatives from different government departments. NMR has consistently denied any wrongdoing, pointing out that its waste is treated in accordance with government regulations. "It is difficult to express in words the disgust we feel regarding these false allegations," Ness said in a press statement after his release, adding that it was not true that NMR operations have affected the quality of the water or the health of villagers. Newmont attributes the villagers' illnesses to poor sanitation and malnutrition. Though mercury is used by thousands of illegal miners, the widespread press coverage in Indonesia has made little of the fact that Newmont - like most international mining companies - has never used mercury in its processing of gold. Indonesian Mining Association chairman Benny Wahju has also defended Newmont, saying it did not use mercury in its mining process and had detoxified its mining waste. The director general of communicable diseases at the Ministry of Health in Jakarta, Umar Fahmi, has also confirmed that the level of mercury detected is "equivalent to the mercury content found in healthy Japanese citizens". Ness has pointed out that everyone in the coastal area eats the same fish. "We live in that area. Our children attend the schools in that area and we do eat the fish and shrimp from those waters. We will not expose the villagers to unsafe or environmentally unsound practices, nor will we expose ourselves or our families to an unsafe situation". The level of fish intake is a major determinant of blood mercury levels. Though NMR has not pointed the finger at small-scale miners, thousands of them operate mostly illegally and with impunity and have been condemned for irresponsible use of chemicals, including mercury, arsenic, and cyanide. There have been suggestions from industry sources that the pollution charges are being drummed up by NGOs and the authorities in a hidden agenda against Newmont, to coerce the company into paying massive compensation before it leaves its Sulawesi mine. Newmont has operated its Messel mine in Ratatotok village since 1996 though it ceased ore mining activities in October 2001 due to depleted reserves within the contract area. Processing ore from the stockpile ended in August and the company plans to completely shut down the mine this month under closing procedures already negotiated with Jakarta. At its peak, the mine produced roughly 340,000 ounces of gold annually, or as much as 8% of the company's global output. Newmont says it has invested steadily for about 20 years, providing "significant economic benefit" for local communities. Over its seven-year period of operations, total direct and indirect benefits to the Indonesian economy were approximately $544 million. Local vested interests may well be unhappy with the scheduled mine closure given the scale of the potential loss of revenue. Regional autonomy in 2001 changed the ball game with some 80% of taxes and royalties now flowing to the local and provincial administrations, instead of to Jakarta, as was the case during the Suharto era. In April 2000, the district court of Tondano in North Sulawesi province ordered Newmont to shut down its gold mine following a dispute over a local tax assessment through the district court. The local government demanded Rp61.5 billion ($8.2 million) in overdue taxes and compensation. Though the Supreme Court blocked the closure, Newmont settled out of court, agreeing to pay about $500,000 in taxes on 379,000 tons of waste material from the mine that a combined central and local government verification team insisted should be taxed. Tests carried out by the Japanese Minamata Institute and the World Health Organization (WHO) show no evidence of any pollution in residents at the site. They have suffered skin disorders but none have claimed or have been shown to suffer from any of the classic symptoms associated with mercury poisoning. Though the cause of the illnesses remains undetermined, a chink of light has appeared in the tunnel for Newmont. Results announced by the Health Ministry on Wednesday appear to vindicate the company's stand and substantiate the opinion of Dr Mineski Sakamoto of the Japanese National Institute for Minamata disease shortly after he visited the village in August under WHO auspices, when he ruled out Minamata disease. In a written statement, the ministry said the levels of mercury in the villagers tested in a study prepared for the WHO at Buyat Bay were "normal". The study also implies that there is no "soup" at all, suggesting that the bay waters were not polluted to toxic levels by other metals or cyanide. Bill Guerin has worked for 19 years in Indonesia as a journalist and editor. He specializes in business/economy issues and political analysis related to Indonesia. He has been a Jakarta correspondent for Asia Times Online since 2000 and has also been published by the BBC on East Timor. He can be reached at [EMAIL PROTECTED] (Copyright 2004 Asia Times Online Ltd. All rights reserved. Please contact [EMAIL PROTECTED] for information on our sales and syndication policies.) ------------------------ Yahoo! Groups Sponsor --------------------~--> Make a clean sweep of pop-up ads. Yahoo! Companion Toolbar. Now with Pop-Up Blocker. 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