INDONESIA: Spurred by Illness, Indonesians Lash Out at Newmont Mining

Publisher Name: 
New York Times

BAY BEACH, Indonesia - First the fish began to disappear. Then
villagers began developing strange rashes and bumps. Finally in
January, Masna Stirman, aided by a $1.50 wet nurse, gave birth to a
tiny, shriveled girl with small lumps and wrinkled skin.

"The nurse said: 'Ma'am, the baby has deformities,' " Mrs. Stirman,
39, recalled in an interview. Unable to get any meaningful medical help
in this remote fishing village of about 300 people, she watched as her
fourth child suffered for months and then died in July.

The infant's death came after years of complaints by local fishermen
about waste dumped in the ocean by the owner of a nearby gold mine, the
Newmont Mining Corporation, the world's biggest gold producer, based in
Denver. It also kicked up a political brawl pitting Indonesia's feisty
environmental groups against the American mining giant, which has been
trailed by allegations of pollution on four continents.

The fight has aroused intense interest in mining circles and among
environmental groups for the fresh concerns it raises about how rich
multinational companies - especially those that extract resources like
coal, copper and gold as well as oil and natural gas - conduct
themselves in poor nations.

For Newmont, the battle is only the latest round of troubles as the
company, concerned by the more stringent rules for mining permits in
the United States, seeks greater growth from operations overseas, where
environmental groups and, increasingly, government officials charge
that it employs practices not tolerated at home.

No definitive cause has been found for the illnesses among the
villagers. Company executives, Newmont said in a statement, were
"convinced that we are not polluting the waters of Buyat Bay or
adversely affecting the health of the people in that area."

But on Aug. 31, an Indonesian government panel announced that
Newmont "had illegally disposed" of waste containing arsenic and
mercury in the ocean near the mine site, and had failed to get the
required permits from the Ministry of Environment since 1996. The
environment minister, Nabiel Makarim, said the company might face
criminal charges.

The findings came a week after a local legal aid group filed a suit
on behalf of three villagers, including the baby's mother, in a
district court in South Jakarta, alleging that they and the baby had
been made sick by the mine waste. They are seeking $543 million in

The company denied the charges and said in its statement that it
"operates in full compliance with Indonesian and U.S. environmental

Newmont has run into trouble before, even at home. But some of the
gravest allegations of polluting mining practices have come from its
operations in developing nations, from Indonesia to Peru to Turkey.

Here, the fight with Newmont has fueled a growing popular impression
that mining and energy companies hold a tight grip over Indonesia's
weak regulatory system. Many blame the corruption, cronyism and
unevolved legal structure inherited from General Suharto, the dictator
whose rule ended in 1998 and who, for a price, eagerly opened the doors
to foreign investors.

When Newmont first came looking for gold in Indonesia in the 1980's,
it dealt with the Suharto government. Since then, a handful of
officials knowledgeable about the environment have said they wanted to
stand up to Newmont and other companies, but lost the battles.

In Newmont's case, correspondence shows that from 2000 to 2002 the
Ministry of Environment challenged Newmont about the toxicity of the
mine waste it was dumping at Buyat Bay. In a letter to Newmont in March
2002, a senior ministry official, Isa Karnisa Ardiputra, listed seven
points of concern and asked for "immediate action."

In an interview at Newmont's Jakarta headquarters on Aug. 27, the
president of Newmont in Indonesia, Richard B. Ness, and other company
officials said they were not aware of the letter.

Emil Salim, a minister of the environment during the Suharto era,
who is overseeing the panel that found Newmont had acted illegally,
reflected the anger of many Indonesians over the dumping of waste that
was allowed to go on for years despite such challenges from parts of
the government.

"We are weak in governance in mining," he said. Using the mine
industry's word to describe the waste, Mr. Salim said he had told the
company: "I am not against you. But please don't put your tailings in
our ocean."

Some sense a potential turning point in the outrage stirred by the death of Mrs. Stirman's baby.

The mother was told by a doctor, Sandra Rotty, an Indonesian who
works at the Newmont financed health center at nearby Ratatok, that the
child had a common skin disease. After examining the baby in April, Dr.
Rotty wrote to a local environmental group, Kelola, that the baby's
skin "disorder" was "caused by malnutrition."

"Now, the baby's condition is already better," she added.

When the child showed no improvement, however, the group asked a team of public health doctors to visit Buyat Bay.

About 120 villagers were waiting to be examined in June in the ad
hoc clinic set up in three local homes. Thirty of the villagers had
tumor-like growths, said one of the doctors, Jane Pangemanan.

"I was shocked by what I saw," she said in an interview. Of the 60
people she examined, about 80 percent showed symptoms of poisoning by
mercury and arsenic, she said.

On a recent visit to the community, and judging from the villagers
who came to the Jakarta courthouse for the opening of the case on Aug.
27, the health problems were evident at almost every turn.

One of the babies had a cyst the size of a small pea on the end of
her tongue. A mother had two lumps on her breasts the size of golf
balls. One woman had a large lump down her left side that made her look
half pregnant.

A lawyer for Newmont, Palmer Situmorang, said the lumps and skin
diseases that the villagers complained about were the result of "poor
sanitation and poor nutrition."

"They are liars because their orientation is to just get money," he said.

But an environmental scientist, Evan Edinger, who is an assistant
professor at the University of Newfoundland in Canada and who is
working with the Indonesian environmental group Friends of the Earth,
said he believed that arsenic in the mine waste was the main cause of
the illnesses.

In laboratory tests in Canada, he found that about 30 percent of the
arsenic in the sediment from Buyat Bay was soluble in weak acid
environments, like the digestive tracts of worms, he said in an

"Our hypothesis is that if you have sediment-feeding organisms and
bottom-dwelling fish eat them, then that could be the pathway to
contamination from arsenic," Mr. Edinger said.

Newmont's own laboratory results also show high levels of arsenic in
the sediment. But the company contends that the arsenic remains inert
and nonsoluble in the ocean.

In a paper released to the news media, Newmont said that
"collectively, there is no scientific evidence to suggest that mining
activity at Minahasa has resulted in arsenic contamination of Buyat Bay
biological ecosystem."

The national police chief in Indonesia, Gen. Da'i Bachtiar, released
the police's own laboratory results in August that showed mercury
contamination of the sea. The company disputed the results, saying the
police did not measure dissolved mercury.

But General Da'i's chief investigator in the case,
Sulistiandriatmoko, retorted: "We are not that stupid. We measured the
dissolved mercury, not the total mercury. I think they are just trying
to distort the case."

The Newmont mine above Buyat Bay is on the northern tip of Sulawesi
in Minahasa, a region where fishermen in handmade wooden boats have
been trawling for hundreds of years. Where small vanilla, clove and
coconut plantations once prospered, Newmont carved five pits into the
brown earth.

With its relatively low costs and high-grade gold that was easy to
get at, it was a "little model of a mine," said Ali Sahami, a geologist
who works as one of Newmont's environmental advisers. At the height of
production from 1998 to 2000, the mine was producing nearly 25 percent
of the company's international output.

Newmont finished mining in 2001 and has since been processing mined ore, work it was scheduled to complete on Aug. 31.

Villagers say the fish off their beach were once so plentiful they
would start a fire for grilling before setting off to catch the evening
meal. But almost immediately after mining operations started, the fish
stocks dropped dramatically.

Rasit Rahman, a squat man with a thick tangle of black hair, who had
a lump removed from the back of his neck recently, was one of the
plaintiffs who appeared in court on Aug. 27.

"My catch dwindled so fast after the mine came, I could no longer
afford to send my youngest son to school," he said. Before the mine
company came to the area in 1996, he said, he could earn $30 a day, a
substantial amount in a village without electricity and running water.
"We had to look for another place to catch fish," he said. "It was so
much harder, and we were getting so little."

At issue is Newmont's use of a waste disposal method, effectively
banned in the United States under the Clean Water Act, that is called
submarine tailing disposal. It involves piping treated mine waste into
the ocean.

Newmont uses the method not only at the mine near Buyat Bay, but
also at its far bigger copper and gold mine on the island of Sumbawa.

The legal aid group, Agency for Health Law, which has brought the
suit on behalf of the villagers, charges that the system polluted the
warm equatorial waters around the village, where people depend almost
exclusively on fish for food as well as for their livelihoods.

In the interview at the company's headquarters, Mr. Ness, the
Newmont president in Indonesia, defended the use of the waste system.
He also made that case before an Indonesian parliamentary committee in

He said it was more "responsible" to put the waste in the sea than
store it on land that could be subject to earthquakes. Furthermore, he
said, "Tailings are nothing more than ground-up rock."

Others disagree. Environmental groups vociferously oppose the sea
disposal of waste. Some mining companies, like the Australian giant BHP
Billiton, say they would not use such a method in current projects,
even though it is cheaper than land-based waste storage.

Robert E. Moran, a hydrogeologist who advises mining companies and
environmental groups, said in a telephone interview from Colorado that
"clearly tailings are much more complex chemically than crushed rock -
or else they would not require detoxification treatment prior to

The waste from the mine being released into the sea amounted to a potentially "toxic soup," he said.

Mr. Moran, who reviewed partial analyses from the plant made
available by Newmont, said he was confident that the waste consisted of
metal-like elements like arsenic and antimony and metals like mercury,
cadmium, lead, copper and zinc.

Those substances in the rock where the gold is found, he said, are
treated with sodium cyanide, and the subsequent mixture is treated
again with other chemicals in an attempt to reduce the concentration of

In all likelihood, Mr. Moran said, some amount of cyanide compounds
and other organic chemicals remained in the waste that was released
into the ocean less than a half mile off shore at a relatively shallow
depth of about 82 meters.

In tropical waters like those around Buyat Bay, the toxic compounds
often became "more mobile and more accessible to the food chain than in
temperate waters," Mr. Moran said.

Washington's political risk insurance agency, the Overseas Private
Investment Corporation, does not like the submarine tailing disposal
system, either. In the late 1990's, the agency refused to give
insurance to a mine operated by Rio Tinto in Papua New Guinea on the
grounds that the mine's submarine tailing system would violate United
States domestic regulations.

Newmont will essentially leave the site near Buyat Bay early next
year, although a small skeleton staff will be on hand for three years
to complete reclamation and oversee some community development
projects, Newmont officials said.

To its critics, Newmont says its mine closure plan will leave a
community better off than when the company arrived. The plan shows
photographs of a new school and groups of happy children splashing in
clean water.

But the villagers at the beach say they are uninterested. They are
no longer able to sell their fish in the local markets. In addition to
the illnesses that many now suffer, their livelihoods are shattered,
said Anwar Stirman, the brother of Mrs. Stirman.

"We can no longer make money from the fish," Mr. Stirman said.
"We're talking to the provincial officials about our future. The whole
village is waiting to be moved to another location."

In any event, Newmont contends that the sea at Buyat Bay is in fine
shape. The company ran color advertisements saying so in 10 Indonesian
newspapers at the end of August.

"We find the water is in excellent condition," said Robert
Humberson, general manager for external relations. "I dive there
myself. It's fabulous."

AMP Section Name:Natural Resources