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US: Newmont on Trial in Indonesia for Pollution

by Jane PerlezNew York Times
August 5th, 2005

MANADO, Indonesia, In a muggy auditorium secured by several hundred police, the Indonesian government today brought criminal charges of polluting the environment against the American mining company Newmont, and its head of operations here.

The president of Newmont in Indonesia, Richard B. Ness, perched on a rickety office chair before a panel of five judges as prosecutors read a 72-page indictment alleging that he and the company had allowed toxic waste to be put in the sea near its gold mine at Buyat Bay, on the northern tip of Sulawesi.

The indictment cited 125 instances over the eight-year life of the mine in which the waste had exceeded government regulations on legal limits for heavy metals, including arsenic and mercury. It said the company did not have the proper license for disposing of the waste.

After the two-and-a-half hour reading of the indictment, Mr. Ness, 55, told the judges that he was not clear what crime the government was accusing him of. "We never received any notification that we violated the law," Mr. Ness said.

A team of 11 lawyers sat at the defense table, and, after the hearing, the lead lawyer, Luhut M. P. Pangaribuan, said the matter did not belong in criminal court.

The opening of the trial, an unusual case of an American corporate giant facing criminal charges in a developing country, comes after villagers at Buyat Bay complained last year of illnesses that they said were the result of the mine's operations.

Newmont, a Denver-based company and the world's biggest gold producer, has denied responsibility for the tumors, skin rashes and dizziness, saying they are common to poor coastal communities. Most of the villagers, citing fears for their health, moved away in June to another area.

An investigation by the Indonesian police that included the testing of water samples at Buyat Bay near the mine resulted in the arrest last September of five Newmont employees. They were released after a month in jail.

In this provincial city where the company has provided employment and tax revenue, the case has engendered strong feelings both for and against Newmont. Those passions skittered across the generally decorous proceedings today.

Local officials say they are in favor of the corporation, and appear uncomfortable that the national government is bringing the criminal case in their jurisdiction. Whether the case will be given a fair hearing in such an atmosphere has been raised by some government officials in Jakarta.

The judiciary here has set a leisurely pace of once-a-week hearings.

In order to accommodate large crowds, the proceedings were moved from the city's cramped courthouse to a more spacious auditorium where plastic chairs were set out for spectators. Mr. Ness's Indonesian wife, Nova, sat in the audience, along with company employees. Two diplomats from the American Embassy in Jakarta were also present.

In fact, there were more security personnel, including the black garbed, local militia, Brigade Manguni, than anybody else.

The head of the brigade, Dicky Y. Maengkom, said the chief judge, Juliana Wullur, had invited him to bring about 200 of his members who milled around outside, some of them carrying fierce-looking long rattan batons.

"We're here to support Newmont," Mr. Maengkom said.

For Indonesia's environmental community the trial's first day offered hope of change from past practices of desultory regulatory enforcement.

"For 30 years giant mining companies have operated in Indonesia with impunity despite shocking environmental practices," said Raja Siregar, the spokesman for the Indonesian Forum for the Environment. The indictment showed, he said, that the company had breached specific Indonesian laws.

One of the main contentions in the indictment revolved around how Newmont disposed of its mine waste, known as tailings, into the sea. Under a method called submarine tailing disposal the company piped the tailings into the equatorial waters about half a mile offshore at a depth of 270 feet. This method of disposal is essentially banned in the United States, according to environmental legal experts.

The government charged today that Newmont's tailings caused pollution because they were put into a "mixed layer" of mostly warm water - instead of cold, deeper water where the tailings would remain stable. At the more shallow depth, the tailings were churned by the "wave action, currents and tides" so that they spread "vertically and horizontally," the indictment said.

Newmont has said that the tailings disposal was safe and worked as planned.

On the question of a permit, the government said the company knew it had only been given a permit for six months in 2000 on the grounds that it complete an acceptable environmental risk assessment on the waste disposal for the Ministry of Environment.

The risk assessment was never completed to satisfaction and the full permit never granted, the indictment said.

The company has said that it was not informed that it did not have the required ministry permit.

Concerning the 125 times that the company is alleged to have exceeded the limits on heavy metals in the waste, Mr. Ness said the indictment used a daily calculation instead of a monthly standard called for in the regulations.

He said the company's records submitted to the government showed that it had exceeded the monthly limit once. In September 2001 the mercury in the tailings was only two micrograms above the allowed limit, he said.

Evelyn Rusli contributed reporting for this article



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