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Newmont lays out defense in pollution case DENVER (U.S.) - Newmont Mining Corp. (NEM) says the pollution allegations against the company in Indonesia have weakened over the last year to the point where the two sides are now arguing about technical and permitting issues in court. "The argument that we killed people went away... then the argument about heinous diseases went away," Blake Rhodes, a Newmont attorney working on the case, said Tuesday. "It's now down to technical issues."

Denver-based Newmont, the world's largest gold producer, is making details of its legal case in Indonesia public and is beefing up its media efforts in the highly publicized case. The essence of Newmont's defense, Rhodes said, is that the company will be able to prove there wasn't environmental pollution related to its mining activities in Sulawesi and "if there is no environmental pollution, there is no crime."

Newmont's Indonesian subsidiary, PT Newmont Minahasa Raya, and PT Newmont President Director Richard Ness are facing environmental pollution charges in a criminal trial that began Aug. 5 in Manado, Indonesia. Because Indonesian courts hold only one hearing per week, the trial is expected to last at least six to eight months.

According to Rhodes, PT Newmont and Ness are charged with breaching four articles of one Indonesian environmental law from the operation of its now-defunct gold mine in Sulawesi. Only one article of the four needs to be proven for the company and Ness to be found guilty of an environmental crime, he said. Ness faces up to 10 years in prison and a $68,000 fine if convicted.

The charges revolve around PT Newmont's waste disposal method, which involved dumping mercury- and arsenic-laced mine waste in Buyat Bay near the mine. Newmont says the mercury and arsenic in the mine waste are insoluble and are still sitting at the bottom of the bay. Prosecutors say the mercury and arsenic have risen to layers nearer the water's surface and have harmed sea life and have become a danger to nearby residents.

The indictment includes more than 120 instances between 1997 and 2004 when Newmont's mine waste exceeded the daily average Indonesian emissions standards for arsenic, cyanide, mercury, iron and copper. "This sends a clear message to investors," Raja Siregar, spokesman for Indonesian environmental group Walhi, said in a press release issued when the trial began last week. "If mining companies run their businesses properly, they won't face legal action. But if their operations adversely impact the environment, they will be sued."

The case has gotten global media attention because it pits a large multinational U.S. corporation against residents of tiny fishing villages in a developing nation. Foreign investors are watching because a legal system that is perceived to be weak could add to the risks of doing business in Indonesia. Indonesian villagers have blamed PT Newmont for skin disorders, tumors and other diseases.

But those allegations don't show up in the government criminal indictment against the company, Newmont's Rhodes said. Instead a translation of the indictment, which Dow Jones Newswires obtained from Newmont, said the people of Buyat Bay "experienced itchiness." Rhodes said only one study - the one done by Indonesian police - has found mercury or arsenic levels exceeded Indonesian environmental standards.

Three independent studies - one done by the Indonesian environmental ministry in November 2003, one by the World Health Organization in August 2004 and one by an integrated team of Indonesian researchers in August 2004 - found mercury and arsenic levels in Buyat Bay to be below environmental standards, Rhodes said. PT Newmont's monthly average mercury release exceeded governmental standards once in eight years in September 2001 and the company's monthly average never exceeded arsenic standards, Rhodes said.

From July 2000 to July 2004, Newmont discharged one-tenth of the total mercury permitted under Indonesian law and 6.6% of the total arsenic allowed, he said. "The water is fine, the fish are fine and the people are fine," Rhodes said. "Our contention, therefore, is that we have not harmed the environment." Newmont began operations in Sulawesi in 1996 and stopped mining there two years ago after extracting all the gold there it could. The company continued processing ore there until Aug. 31, 2004, when the mine was permanently shut.

Newmont continues to operate a gold and copper mine in West Sumbawa that also uses the same waste disposal method. The Indonesian Environmental Ministry Tuesday awarded that mine a "green proper rating" indicating the company implemented pollution control measures to protect the environment, Newmont said.

Posted in General @ 11 August 2005 07:11 CET by Jeroen · 'Blog' RSS feed · permalink

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